1.Short title; table of
contents
(a)This Act may be cited
as the Siding with America’s Patients
Act
.
(b)The table of contents for this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Repeal of PPACA.
Title I—Tax Incentives for Maintaining Health Insurance
Coverage
Sec. 101. Refundable tax credit for health insurance costs of
low-income individuals.
Sec. 102. Advance payment of credit as premium payment for
qualified health insurance.
Sec. 103. Election of tax credit instead of alternative
government or group plan benefits.
Sec. 104. Deduction for qualified health insurance costs of
individuals.
Sec. 105. Limitation on abortion funding.
Sec. 106. Non-discrimination on abortion and respect for rights
of conscience.
Sec. 107. Equal employer contribution rule to promote
choice.
Sec. 108. Limitations on State restrictions on employer
auto-enrollment.
Sec. 109. Credit for small employers adopting auto-enrollment
and defined contribution options.
Sec. 110. Require employers to disclose amounts paid for
employer-provided health plan coverage.
Sec. 111. HSA modifications and clarifications.
Title II—Health Insurance Pooling Mechanisms for
Individuals
Subtitle A—Safety Net for Individuals with Pre-Existing
Conditions
Sec. 201. Requiring operation of high-risk pool or other
mechanism as condition for availability of tax credit.
Subtitle B—Federal Block Grants for State Insurance
Expenditures
Sec. 211. Federal block grants for State insurance
expenditures.
Subtitle C—Health Care Access and Availability
Sec. 221. Expansion of access and choice through individual
membership associations (IMAs).
Subtitle D—Small Business Health Fairness
Sec. 231. Short title.
Sec. 232. Rules governing association health plans.
Sec. 233. Clarification of treatment of single employer
arrangements.
Sec. 234. Enforcement provisions relating to association health
plans.
Sec. 235. Cooperation between Federal and State
authorities.
Sec. 236. Effective date and transitional and other
rules.
Title III—Interstate Market for Health Insurance
Sec. 301. Cooperative governing of individual health insurance
coverage.
Title IV—Safety Net Reforms
Sec. 401. Requiring outreach and coverage before expansion of
eligibility.
Sec. 402. Easing administrative barriers to State cooperation
with employer-sponsored insurance coverage.
Sec. 403. Improving beneficiary choice in SCHIP.
Sec. 404. Liability protections for health center volunteer
practitioners.
Sec. 405. Liability protections for health center practitioners
providing services in emergency areas.
Title V—Medical Liability and Uncompensated Care
Reforms
Sec. 501. Short title.
Sec. 502. Findings and purpose.
Sec. 503. Encouraging speedy resolution of claims.
Sec. 504. Compensating patient injury.
Sec. 505. Maximizing patient recovery.
Sec. 506. Additional health benefits.
Sec. 507. Punitive damages.
Sec. 508. Authorization of payment of future damages to
claimants in health care lawsuits.
Sec. 509. Definitions.
Sec. 510. Effect on other laws.
Sec. 511. State flexibility and protection of states’
rights.
Sec. 512. Applicability; effective date.
Sec. 513. Sense of Congress.
Sec. 514. State grants to create administrative health care
tribunals.
Sec. 515. Affirmative defense based on compliance with best
practice guidelines.
Sec. 516. Bad debt deduction for doctors to partially offset
the cost of providing uncompensated care required to be provided under
amendments made by the Emergency Medical Treatment and Labor Act.
Title VI—Wellness and Prevention
Sec. 601. Providing financial incentives for treatment
compliance.
Title VII—Transparency and Insurance Reform Measures
Sec. 701. Receipt and response to requests for claim
information.
Title VIII—Quality
Sec. 801. Prohibition on certain uses of data obtained from
comparative effectiveness research; accounting for personalized medicine and
differences in patient treatment response.
Sec. 802. Establishment of performance-based quality
measures.
Title IX—State Transparency Plan Portal
Sec. 901. Providing information on health coverage options and
health care providers.
Title X—Physician payment reform
Sec. 1001. Sustainable growth rate reform.
Title XI—Incentives to reduce physician shortages
Subtitle A—Federally Supported Student Loan Funds for Medical
Students
Sec. 1101. Federally Supported Student Loan Funds for Medical
Students.
Subtitle B—Loan Forgiveness for Primary Care
Providers
Sec. 1111. Loan forgiveness for primary care
providers.
Title XII—Offsets
Subtitle A—Enforcing discretionary spending limits
Sec. 1201. Enforcing discretionary spending limits.
Subtitle B—Repeal of unused stimulus funds
Sec. 1211. Rescission and repeal in ARRA.
Subtitle C—Savings from health care efficiencies
Sec. 1221. Medicare DSH report and payment adjustments in
response to coverage expansion.
Sec. 1222. Reduction in Medicaid DSH.
Subtitle D—Fraud, Waste, and Abuse
Sec. 1231. Provide adequate funding to HHS OIG and
HCFAC.
Sec. 1232. Improved enforcement of the Medicare secondary payor
provisions.
Sec. 1233. Strengthen Medicare provider enrollment standards
and safeguards.
Sec. 1234. Tracking banned providers across State
lines.
Sec. 1235. Reinstate the Medicare trigger.
2.Effective as of the
enactment of the Patient Protection and Affordable Care Act, such Act is
repealed, and the provisions of law amended or repealed by such Act are
restored or revived as if such Act had not been enacted.
<enum>I</enum><header>Tax
Incentives for Maintaining Health Insurance Coverage</header>
<section id="HE39477FFCEF24C8CB7CCF3AA890DC407"><enum>101.</enum><header>Refundable tax
credit for health insurance costs of low-income individuals</header>
<subsection id="HA5AD904A6B724B238F05A64697D82CBD"><enum>(a)</enum><header>In
general</header><text>Subpart C of part IV of subchapter A of chapter 1 of the
Internal Revenue Code of 1986 (relating to refundable credits) is amended by
inserting after section 36A the following new section:</text>
<quoted-block display-inline="no-display-inline" id="H7AD7FAFEEEE045B59E7D6C659F825C34" style="OLC">
<section id="H1458BC700456415F9059DEC9A8A38C94"><enum>36B.</enum><header>Health
insurance costs of low-income individuals</header>
<subsection id="HA7AC3F2FDD7D4F918DC428DA0188ED86"><enum>(a)</enum><header>In
general</header><text>In the case of an individual, there shall be allowed as a
credit against the tax imposed by subtitle A the aggregate amount paid by the
taxpayer for coverage of the taxpayer and the taxpayer’s qualifying family
members under qualified health insurance for eligible coverage months beginning
in the taxable year.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H4CAFC8CE770840DDB8506D4545B20798"><enum>(b)</enum><header>Limitations</header>
<paragraph id="H54899F33DC5D449091C00A5AF7551BD3"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">The amount allowable
as a credit under subsection (a) for the taxable year shall not exceed the
lesser of—</text>
<subparagraph id="H9C823CEC03724344BAD7310DCD832B4F"><enum>(A)</enum><text>the sum of the
monthly limitations for months during such taxable year that the taxpayer or
the taxpayer’s qualifying family members is an eligible individual, and</text>
</subparagraph><subparagraph id="H82519C52371E49DBA0BD55BF629584D7"><enum>(B)</enum><text>the aggregate
premiums paid by the taxpayer for the taxable year for coverage described in
subsection (a).</text>
</subparagraph></paragraph><paragraph commented="no" id="H40A3E831F7694E258907ABA0E77954B0"><enum>(2)</enum><header>Monthly
limitation</header><text display-inline="yes-display-inline">The monthly
limitation for any month is the credit percentage of <fraction>1/12</fraction>
of the sum of—</text>
<subparagraph commented="no" id="HC79FC81153484D7FA9E02197C310FA94"><enum>(A)</enum><text>$2,000 for
coverage of the taxpayer ($4,000 in the case of a joint return for coverage of
the taxpayer and the taxpayer’s spouse), and</text>
</subparagraph><subparagraph id="H6E27C44A7C904BE2832372662AADD26B"><enum>(B)</enum><text>$500 for coverage
of each dependent of the taxpayer.</text>
</subparagraph></paragraph><paragraph id="HBD025E61C27F403D99C8F4F6E2350E2F"><enum>(3)</enum><header>Credit
percentage</header>
<subparagraph id="H8582AB8D45444CEBB474D7BD1BAE08A5"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">For purposes of this
section, the term <term>credit percentage</term> means 100 percent reduced by 1
percentage point for each $1,000 (or fraction thereof) by which the taxpayer’s
adjusted gross income for the taxable year exceeds the threshold amount.</text>
</subparagraph><subparagraph id="H0EEBA01CD9654ECCBFE7BAE39344405E"><enum>(B)</enum><header>Threshold
amount</header><text>For purposes of this paragraph, the term <term>threshold
amount</term> means, with respect to any taxpayer for any taxable year, 200
percent of the Federal poverty guideline (as determined by the Secretary of
Health and Human Service for the taxable year) applicable to the
taxpayer.</text>
</subparagraph></paragraph><paragraph id="H3F8430C6932B4FECA5C1A785873F55E7"><enum>(4)</enum><header>Only 2
dependents taken into account</header><text>Not more than 2 dependents of the
taxpayer may be taken into account under paragraphs (2)(C) and (3)(B).</text>
</paragraph><paragraph id="H4F2E5941D7B8414A82C630A284B9064A"><enum>(5)</enum><header>Inflation
adjustment</header><text display-inline="yes-display-inline">In the case of any
taxable year beginning in a calendar year after 2009, each dollar amount
contained in paragraph (2) shall be increased by an amount equal to—</text>
<subparagraph id="H41A9A9B7F26C4039AC27A423CAD9F7A8"><enum>(A)</enum><text>such dollar
amount, multiplied by</text>
</subparagraph><subparagraph id="H6E3D70B87FEF4C118F8F026C5EE3A1DA"><enum>(B)</enum><text>the cost-of-living
adjustment determined under section 1(f)(3) for the calendar year in which the
taxable year begins, determined by substituting <quote>calendar year
2008</quote> for <quote>calendar year 1992</quote> in subparagraph (B)
thereof.</text>
</subparagraph><continuation-text continuation-text-level="paragraph">Any
increase determined under the preceding sentence shall be rounded to the
nearest multiple of $50.</continuation-text></paragraph></subsection><subsection id="H54CE7F642079479AA5BE94DC57049912"><enum>(c)</enum><header>Eligible
coverage month</header><text>For purposes of this section, the term
<term>eligible coverage month</term> means, with respect to any individual, any
month if, as of the first day of such month, the individual—</text>
<paragraph id="HB1C54256E3AD4AEBB3A871084985D985"><enum>(1)</enum><text>is covered by
qualified health insurance,</text>
</paragraph><paragraph id="H0BCEBA161B9E40E3B3B000C360F9C143"><enum>(2)</enum><text>does not have
other specified coverage, and</text>
</paragraph><paragraph id="H9B517BEB0A2E4FB794C069784B79767A"><enum>(3)</enum><text>is not imprisoned
under Federal, State, or local authority.</text>
</paragraph></subsection><subsection id="H64F00C62C2984703BA563FEC1915B249"><enum>(d)</enum><header>Qualifying
family member</header><text>For purposes of this section, the term
<term>qualifying family member</term> means—</text>
<paragraph id="H928FC63CB5584954A903332A69518E0F"><enum>(1)</enum><text>in the case of a
joint return, the taxpayer’s spouse, and</text>
</paragraph><paragraph id="HCDB7640496C74014B804A7F5C7952E8A"><enum>(2)</enum><text>any dependent of
the taxpayer.</text>
</paragraph></subsection><subsection id="HADE4AB11231F4657B1279A5A064899FC"><enum>(e)</enum><header>Qualified health
insurance</header><text>For purposes of this section, the term <term>qualified
health insurance</term> means health insurance coverage (other than excepted
benefits as defined in section 9832(c)) which constitutes medical care.</text>
</subsection><subsection id="HEA90F5C6ABB14C74B0B2D1DD2DC8F6C3"><enum>(f)</enum><header>Other specified
coverage</header><text>For purposes of this section, an individual has other
specified coverage for any month if, as of the first day of such month—</text>
<paragraph id="HB44B51754F494001AE963FF4926A31A2"><enum>(1)</enum><header>Coverage under
medicare, medicaid, or schip</header><text>Such individual—</text>
<subparagraph id="HFDA18A7DE3374AB4930873C3E6EB80DF"><enum>(A)</enum><text>is entitled to
benefits under part A of title XVIII of the Social Security Act or is enrolled
under part B of such title, or</text>
</subparagraph><subparagraph id="HCCB8A83F9DBC4DBC9F7A98ADD5364C2B"><enum>(B)</enum><text>is enrolled in the
program under title XIX or XXI of such Act (other than under section 1928 of
such Act).</text>
</subparagraph></paragraph><paragraph id="HF06FE3D9894F41CDAFAF34FCF03067F0"><enum>(2)</enum><header>Certain other
coverage</header><text>Such individual—</text>
<subparagraph id="H8DA6FBA328214DE4BFC7D6E11665FA71"><enum>(A)</enum><text>is enrolled in a
health benefits plan under chapter 89 of title 5, United States Code,</text>
</subparagraph><subparagraph id="H5AA71E9575D54ACE9C7D7E65E870AEF9"><enum>(B)</enum><text>is entitled to
receive benefits under chapter 55 of title 10, United States Code,</text>
</subparagraph><subparagraph id="HD373C846A3E740B988568B1F25045778"><enum>(C)</enum><text display-inline="yes-display-inline">in entitled to receive benefits under
chapter 17 of title 38, United States Code, or</text>
</subparagraph><subparagraph id="HE9CA2BAC961C4E3882F9EE52D9750D53"><enum>(D)</enum><text>is enrolled in a
group health plan (within the meaning of section 5000(b)(1)) which is
subsidized by the employer.</text>
</subparagraph></paragraph></subsection><subsection id="HE2B93AD665304D31AA28BAB2C001FE54"><enum>(g)</enum><header>Special
rules</header>
<paragraph id="H2FFAEB3DC7BD407C89CF1BA438722952"><enum>(1)</enum><header>Coordination
with advance payments of credit; recapture of excess advance
payments</header><text>With respect to any taxable year—</text>
<subparagraph id="HEA7869044DE843C495D1F5714C1C4283"><enum>(A)</enum><text>the amount which
would (but for this subsection) be allowed as a credit to the taxpayer under
subsection (a) shall be reduced (but not below zero) by the aggregate amount
paid on behalf of such taxpayer under section 7529 for months beginning in such
taxable year, and</text>
</subparagraph><subparagraph id="HD7758BDFD19A4A30BA54667FE705595B"><enum>(B)</enum><text>the tax imposed by
section 1 for such taxable year shall be increased by the excess (if any)
of—</text>
<clause id="H7E6FE17F787645DD8E03898B4219A262"><enum>(i)</enum><text display-inline="yes-display-inline">the aggregate amount paid on behalf of such
taxpayer under section 7529 for months beginning in such taxable year,
over</text>
</clause><clause id="HF6B25FE5A13449A9BF8911313E41BC64"><enum>(ii)</enum><text display-inline="yes-display-inline">the amount which would (but for this
subsection) be allowed as a credit to the taxpayer under subsection (a).</text>
</clause></subparagraph></paragraph><paragraph id="H189814948E944FF1B12A561F536D6520"><enum>(2)</enum><header>Coordination
with other deductions</header><text>Amounts taken into account under subsection
(a) shall not be taken into account in determining—</text>
<subparagraph id="HDDAB9B23095842428DAB5FFBCD0EE1F7"><enum>(A)</enum><text>any deduction
allowed under section 162(l), 213, or 224, or</text>
</subparagraph><subparagraph id="HF2AC998B0C7E43D08DBE76F050FA2D75"><enum>(B)</enum><text>any credit allowed
under section 35.</text>
</subparagraph></paragraph><paragraph id="HA3B8E46033DC4CE0A66AEF7E8457E9C0"><enum>(3)</enum><header>Medical and
health savings accounts</header><text>Amounts distributed from an Archer MSA
(as defined in section 220(d)) or from a health savings account (as defined in
section 223(d)) shall not be taken into account under subsection (a).</text>
</paragraph><paragraph id="H07AA3D52DD9B47A2A0E43F3280D883AB"><enum>(4)</enum><header>Denial of credit
to dependents and nonpermanent resident alien individuals</header><text>No
credit shall be allowed under this section to any individual who is—</text>
<subparagraph id="HF0EEDB61E9F941A3B98128A3349869C4"><enum>(A)</enum><text display-inline="yes-display-inline">not a citizen or lawful permanent resident
of the United States for the calendar year in which the taxable year begins,
or</text>
</subparagraph><subparagraph id="H9C91A571FFA448AA96312B0AE7FC1565"><enum>(B)</enum><text>a dependent with
respect to another taxpayer for a taxable year beginning in the calendar year
in which such individual’s taxable year begins.</text>
</subparagraph></paragraph><paragraph id="H34D4A6CC894C4CB2B56AA23F37F5F685"><enum>(5)</enum><header>Insurance which
covers other individuals</header><text>For purposes of this section, rules
similar to the rules of section 213(d)(6) shall apply with respect to any
contract for qualified health insurance under which amounts are payable for
coverage of an individual other than the taxpayer and qualifying family
members.</text>
</paragraph><paragraph id="H1B76F06DAC7B47D68E3813B9D0C66A68"><enum>(6)</enum><header>Treatment of
payments</header><text>For purposes of this section—</text>
<subparagraph id="H3922B40ADD344BEEB1F0476A10268DD2"><enum>(A)</enum><header>Payments by
secretary</header><text>Payments made by the Secretary on behalf of any
individual under section 7529 (relating to advance payment of credit for health
insurance costs of low-income individuals) shall be treated as having been made
by the taxpayer on the first day of the month for which such payment was
made.</text>
</subparagraph><subparagraph id="H5F858835319242D69FB367768EEAFF8D"><enum>(B)</enum><header>Payments by
taxpayer</header><text>Payments made by the taxpayer for eligible coverage
months shall be treated as having been made by the taxpayer on the first day of
the month for which such payment was made.</text>
</subparagraph></paragraph><paragraph id="H06045ECC1F5C43C9A7A776DBF0EA2606"><enum>(7)</enum><header>Regulations</header><text>The
Secretary may prescribe such regulations and other guidance as may be necessary
or appropriate to carry out this section, section 6050W, and section
7529.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HB8E7CF8252D64BEB8632A41F68DF11AC"><enum>(b)</enum><header>Conforming
amendments</header>
<paragraph id="HFF53B78FE76E4AC5A4A516702458EE3B"><enum>(1)</enum><text>Paragraph (2) of
section 1324(b) of title 31, United States Code, is amended by inserting
<quote>36B,</quote> after <quote>36A,</quote>.</text>
</paragraph><paragraph id="HC732A5F56F34410C819FCD76573ECBDD"><enum>(2)</enum><text>The table of
sections for subpart C of part IV of subchapter A of chapter 1 of the Internal
Revenue Code of 1986 is amended by inserting after the item relating to section
36A the following new item:</text>
<quoted-block display-inline="no-display-inline" id="H9867FDE6613E48B69866CA78FF69264A" style="OLC">
<toc container-level="quoted-block-container" idref="H7AD7FAFEEEE045B59E7D6C659F825C34" lowest-bolded-level="division-lowest-bolded" lowest-level="section" quoted-block="no-quoted-block" regeneration="yes-regeneration">
<toc-entry idref="H1458BC700456415F9059DEC9A8A38C94" level="section">Sec. 36B. Health insurance costs of low-income
individuals.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="HEEBFEC8B6AC74569A0F08B8F3B8134B6"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to taxable
years beginning after December 31, 2009.</text>
</subsection><subsection commented="no" id="H5D5E2CE85E504D0AB2A9074CEC55CD10"><enum>(d)</enum><header>Sense of
Congress</header><text display-inline="yes-display-inline">It is the sense of
Congress that the cost of the advanceable refundable credit under sections 36B
and 7529 of the Internal Revenue Code of 1986, as added by this title, will be
offset by savings derived from the provisions of title XII.</text>
</subsection></section><section display-inline="no-display-inline" id="H76914D513C91489693FF77486D9A2667" section-type="subsequent-section"><enum>102.</enum><header>Advance payment of
credit as premium payment for qualified health insurance</header>
<subsection id="H19763DE6FFC846F0B2B9F3754A540475"><enum>(a)</enum><header>In
general</header><text>Chapter 77 of the Internal Revenue Code of 1986 (relating
to miscellaneous provisions) is amended by adding at the end the
following:</text>
<quoted-block id="HC961BE74936446139691F65E118A89C2">
<section id="HB69FDA97B6AE49EAB4C099A8B461FBED"><enum>7529.</enum><header>Advance
payment of credit as premium payment for qualified health insurance</header>
<subsection id="HB734BD6BE5FC408181A8DD0A21A3CBE8"><enum>(a)</enum><header>General
rule</header><text display-inline="yes-display-inline">Not later than January
1, 2010, the Secretary shall establish a program for making payments to
providers of qualified health insurance (as defined in section 36B(e)) on
behalf of taxpayers eligible for the credit under section 36B. Except as
otherwise provided by the Secretary, such payments shall be made on the basis
of the adjusted gross income of the taxpayer for the preceding taxable
year.</text>
</subsection><subsection id="H8AA1066CAE5248E18284CC25DBA729DB"><enum>(b)</enum><header>Certification
process and proof of coverage</header><text>For purposes of this section,
payments may be made pursuant to subsection (a) only with respect to
individuals for whom a qualified health insurance costs credit eligibility
certificate is in
effect.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H09261F21B79A41B6966B76EBD5A4FCA2"><enum>(b)</enum><header>Disclosure of
return information for purposes of advance payment of credit as premiums for
qualified health insurance</header>
<paragraph id="HFCA4D99387294A63AF791003256FA69A"><enum>(1)</enum><header>In
general</header><text>Subsection (l) of section 6103 of such Code is amended by
adding at the end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H5B74C8572A724DED9215B9225F32EF74" style="OLC">
<paragraph id="HA78EA83B62F74C209536A090D821C585"><enum>(21)</enum><header>Disclosure of
return information for purposes of advance payment of credit as premiums for
qualified health insurance</header><text display-inline="yes-display-inline">The Secretary may, on behalf of taxpayers
eligible for the credit under section 36B, disclose to a provider of qualified
health insurance (as defined in section 36(e)), and persons acting on behalf of
such provider, return information with respect to any such taxpayer only to the
extent necessary (as prescribed by regulations issued by the Secretary) to
carry out the program established by section 7529 (relating to advance payment
of credit as premium payment for qualified health
insurance).</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="HD4EEBA11E0C34F59932BB4662E69622E"><enum>(2)</enum><header>Confidentiality
of information</header><text>Paragraph (3) of section 6103(a) of such Code is
amended by striking <quote>or (20)</quote> and inserting <quote>(20), or
(21)</quote>.</text>
</paragraph><paragraph commented="no" id="H617FC84942354E21B43BE9521F3CCADB"><enum>(3)</enum><header>Unauthorized
disclosure</header><text display-inline="yes-display-inline">Paragraph (2) of
section 7213(a) of such Code is amended by striking <quote>or (20)</quote> and
inserting <quote>(20), or (21)</quote>.</text>
</paragraph></subsection><subsection id="H19E9BBB0426E43F1A20DD78488F9E421"><enum>(c)</enum><header>Information
reporting</header>
<paragraph id="H64320F6CD207489AB5C649FCC443975C"><enum>(1)</enum><header>In
general</header><text>Subpart B of part III of subchapter A of chapter 61 of
such Code (relating to information concerning transactions with other persons)
is amended by adding at the end the following new section:</text>
<quoted-block display-inline="no-display-inline" id="H700EE9B64224473E99628692CEA627F1" style="OLC">
<section id="HEE78E0B837F849C08E208E1214C74128"><enum>6050X.</enum><header>Returns
relating to credit for health insurance costs of low-income
individuals</header>
<subsection id="H3BB83FB58B2C42138246057EC47564D8"><enum>(a)</enum><header>Requirement of
reporting</header><text display-inline="yes-display-inline">Every person who is
entitled to receive payments for any month of any calendar year under section
7529 (relating to advance payment of credit as premium payment for qualified
health insurance) with respect to any individual shall, at such time as the
Secretary may prescribe, make the return described in subsection (b) with
respect to each such individual.</text>
</subsection><subsection id="H67F98F8CB7AC4F1C8B6CD25B8C40485B"><enum>(b)</enum><header>Form and manner
of returns</header><text>A return is described in this subsection if such
return—</text>
<paragraph id="HDD701FC754824AE8BCEF76967B065AAC"><enum>(1)</enum><text>is in such form as
the Secretary may prescribe, and</text>
</paragraph><paragraph id="H44BD40C91D4B4A95B156C91B68FDC5A4"><enum>(2)</enum><text>contains—</text>
<subparagraph id="H6BD8A871EB0E430899288E89EC2BD312"><enum>(A)</enum><text>the name, address,
and TIN of each individual referred to in subsection (a),</text>
</subparagraph><subparagraph id="HECFD4DC5241C4683AEBE9CD49F897C05"><enum>(B)</enum><text display-inline="yes-display-inline">the number of months for which amounts were
entitled to be received with respect to such individual under section 7529
(relating to advance payment of credit as premium payment for qualified health
insurance),</text>
</subparagraph><subparagraph id="HB4610996D638459088225638F25D6138"><enum>(C)</enum><text>the amount
entitled to be received for each such month, and</text>
</subparagraph><subparagraph id="HA1CA27A061F44CCC9C2210495861ACAF"><enum>(D)</enum><text>such other
information as the Secretary may prescribe.</text>
</subparagraph></paragraph></subsection><subsection id="H00E5A168A1AE4039B351B32665EB4626"><enum>(c)</enum><header>Statements To be
furnished to individuals with respect to whom information is
required</header><text>Every person required to make a return under subsection
(a) shall furnish to each individual whose name is required to be set forth in
such return a written statement showing—</text>
<paragraph id="HD56BC26B55B949EFA4755BAD875A7F9C"><enum>(1)</enum><text>the name and
address of the person required to make such return and the phone number of the
information contact for such person, and</text>
</paragraph><paragraph id="HCA27F94113AD45A291EDB69EAFD5A00E"><enum>(2)</enum><text>the information
required to be shown on the return with respect to such individual.</text>
</paragraph><continuation-text continuation-text-level="subsection">The
written statement required under the preceding sentence shall be furnished on
or before January 31 of the year following the calendar year for which the
return under subsection (a) is required to be
made.</continuation-text></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="H7B63EB95DB2C45A093610909E7B6D64F"><enum>(2)</enum><header>Assessable
penalties</header>
<subparagraph id="H80BC2B5F1DD4444E8C5C6C07E4266AE7"><enum>(A)</enum><text>Subparagraph (B)
of section 6724(d)(1) of such Code (relating to definitions) is amended by
striking <quote>or</quote> at the end of clause (xxii), by striking
<quote>and</quote> at the end of clause (xxiii) and inserting
<quote>or</quote>, and by inserting after clause (xxiii) the following new
clause:</text>
<quoted-block display-inline="no-display-inline" id="H4A8CE23FE8024A08BECC8176EE90A1C1" style="OLC">
<clause id="H10F388B3F63F47258BEDE93FF9143369"><enum>(xxiv)</enum><text display-inline="yes-display-inline">section 6050X (relating to returns relating
to credit for health insurance costs of low-income individuals),
and</text>
</clause><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="H1D9868D6AF5944919C45753A4EC341B2"><enum>(B)</enum><text>Paragraph (2) of
section 6724(d) of such Code is amended by striking <quote>or</quote> at the
end of subparagraph (EE), by striking the period at the end of subparagraph
(FF) and inserting <quote>, or</quote>, and by adding after subparagraph (FF)
the following new subparagraph:</text>
<quoted-block display-inline="no-display-inline" id="H0DC518E233F447F6A0FE96FE32E3B4CD" style="OLC">
<subparagraph id="H83264ED679E14DEBBF5FCA3A630507D7"><enum>(GG)</enum><text display-inline="yes-display-inline">section 6050X (relating to returns relating
to credit for health insurance costs of low-income
individuals).</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph></subsection><subsection id="HED922E7961A5483789A331EE62667F7C"><enum>(d)</enum><header>Clerical
amendments</header>
<paragraph id="H74EAA90FCBC84FEAABD5E9757CFD2EAC"><enum>(1)</enum><text>The table of
sections for chapter 77 of such Code is amended by adding at the end the
following new item:</text>
<quoted-block display-inline="no-display-inline" id="H8D2E065137F7491FB9CEEDC2C5F70555" style="OLC">
<toc regeneration="no-regeneration">
<toc-entry level="section">Sec. 7529. Advance payment of credit as
premium payment for qualified health
insurance.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="H6F05DD85A86B4785AE1C3CA1A6F0DF60"><enum>(2)</enum><text>The table of
sections for subpart B of part III of subchapter A of chapter 61 of such Code
is amended by adding at the end the following new item:</text>
<quoted-block display-inline="no-display-inline" id="H53484C5DDC404B44AB152DEDCDBE72EA" style="OLC">
<toc container-level="quoted-block-container" idref="H700EE9B64224473E99628692CEA627F1" lowest-bolded-level="division-lowest-bolded" lowest-level="section" quoted-block="no-quoted-block" regeneration="yes-regeneration">
<toc-entry idref="HEE78E0B837F849C08E208E1214C74128" level="section">Sec. 6050X. Returns relating to credit for health insurance
costs of low-income
individuals.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="HDCF79E18D7F9429DB3711974DABBB425"><enum>(e)</enum><header>Effective
date</header><text>The amendments made by this section shall take effect on the
date of the enactment of this Act.</text>
</subsection></section><section id="HFA9AFFEDBE6E453AB0481543193D660B"><enum>103.</enum><header>Election of tax
credit instead of alternative government or group plan benefits</header>
<subsection id="H8784268D95804DE7B00FE33EF90B4C7A"><enum>(a)</enum><header>In
general</header><text>Notwithstanding any other provision of law, an individual
who is otherwise eligible for benefits under a health program (as defined in
subsection (c)) may elect, in a form and manner specified by the Secretary of
Health and Human Services in consultation with the Secretary of the Treasury,
to receive a tax credit described in section 36B of the Internal Revenue Code
of 1986 (which may be used for the purpose of health insurance coverage) in
lieu of receiving any benefits under such program.</text>
</subsection><subsection id="HD111E16463DF4A50A71495D87C6017BA"><enum>(b)</enum><header>Effective
date</header><text>An election under subsection (a) may first be made for
calendar year 2010 and any such election shall be effective for such period
(not less than one calendar year) as the Secretary of Health and Human Services
shall specify, in consultation with the Secretary of the Treasury.</text>
</subsection><subsection id="H1E9F258849224BBABE4BD67970283257"><enum>(c)</enum><header>Health program
defined</header><text>For purposes of this section, the term <term>health
program</term> means any of the following:</text>
<paragraph id="H6D286EC7D9D24020B35FA91032213085"><enum>(1)</enum><header>Medicare</header><text>The
medicare program under part A of title XVIII of the Social Security Act.</text>
</paragraph><paragraph id="HB4A0F4DF606C493E86D5871C4D56170C"><enum>(2)</enum><header>Medicaid</header><text>The
Medicaid program under title XIX of such Act (including such a program
operating under a Statewide waiver under section 1115 of such Act).</text>
</paragraph><paragraph id="H962F54BF9AA6415B8B4773B914FEEF40"><enum>(3)</enum><header>SCHIP</header><text>The
State children’s health insurance program under title XXI of such Act.</text>
</paragraph><paragraph id="HD1AE70128E4A4679ACB3A742CCB755F2"><enum>(4)</enum><header>TRICARE</header><text>The
TRICARE program under chapter 55 of title 10, United States Code.</text>
</paragraph><paragraph id="H0F1E3C684BB34794B84747975DBE21B0"><enum>(5)</enum><header>Veterans
benefits</header><text>Coverage for benefits under chapter 17 of title 38,
United States Code.</text>
</paragraph><paragraph id="H52643945A9234646B86FE69956DF7626"><enum>(6)</enum><header>FEHBP</header><text display-inline="yes-display-inline">Coverage under chapter 89 of title 5,
United States Code.</text>
</paragraph><paragraph id="H84A77BF9B1DC46B888EF67DC595FEAD5"><enum>(7)</enum><header>Subsidized group
health plans</header><text display-inline="yes-display-inline">Coverage under a
group health plan (within the meaning of section 5000(b)(1)) which is
subsidized by the employer.</text>
</paragraph></subsection><subsection id="HAF86972431DC455EA7534AF441BB56C5"><enum>(d)</enum><header>Other Social
Security benefits not waived</header><text>An election to waive the benefits
described in subsection (c)(1) shall not result in the waiver of any other
benefits under the Social Security Act.</text>
</subsection></section><section display-inline="no-display-inline" id="H4CA12E5C3FC2452D8F3B23060334B5D0" section-type="subsequent-section"><enum>104.</enum><header>Deduction for
qualified health insurance costs of individuals</header>
<subsection id="H15A60FD7BDD0469EA9C57F079E7045FB"><enum>(a)</enum><header>In
general</header><text>Part VII of subchapter B of chapter 1 of the Internal
Revenue Code of 1986 (relating to additional itemized deductions) is amended by
redesignating section 224 as section 225 and by inserting after section 223 the
following new section:</text>
<quoted-block id="H3E4D5AD32E2A4F438E0F12583A7E0F6A">
<section id="HCE908854A4F44D9BA3CC6A9558138CA5"><enum>224.</enum><header>Costs of
qualified health insurance</header>
<subsection id="H8C88ADDE5CF443919531B685B01AABEE"><enum>(a)</enum><header>In
general</header><text>In the case of an individual, there shall be allowed as a
deduction an amount equal to the amount paid during the taxable year for
coverage for the taxpayer, his spouse, and dependents under qualified health
insurance.</text>
</subsection><subsection id="HA09250AACCEA4E4C9FB703601795B21E"><enum>(b)</enum><header>Limitation</header><text>In
the case of any taxpayer for any taxable year, the deduction under subsection
(a) shall not exceed an amount that would cause the taxpayer’s Federal income
tax liability to be reduced by more than the average value of the national
health exclusion for employer sponsored insurance as determined by calculating
the value of the exclusion for each household followed by calculating the
average of those values.</text>
</subsection><subsection id="H30AD9F9587964272A8817D1BB4DB831D"><enum>(c)</enum><header>Qualified health
insurance</header><text>For purposes of this section, the term <term>qualified
health insurance</term> has the meaning given such term by section
36B(e).</text>
</subsection><subsection id="H82110EF580F2401E8A8AE64A3BEF4D80"><enum>(d)</enum><header>Special
rules</header>
<paragraph id="H619DED7D24FF4EBA93F3DDBB00366404"><enum>(1)</enum><header>Coordination
with medical deduction, etc</header><text>Any amount paid by a taxpayer for
insurance to which subsection (a) applies shall not be taken into account in
computing the amount allowable to the taxpayer as a deduction under section
162(l) or 213(a). Any amount taken into account in determining the credit
allowed under section 35 or 36B shall not be taken into account for purposes of
this section.</text>
</paragraph><paragraph id="H30E5EB6538E44C3BBC2C1E7077514A62"><enum>(2)</enum><header>Deduction not
allowed for self-employment tax purposes</header><text>The deduction allowable
by reason of this section shall not be taken into account in determining an
individual’s net earnings from self-employment (within the meaning of section
1402(a)) for purposes of chapter
2.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HDCD9BFDF2C974435A4C934BA54A61F21"><enum>(b)</enum><header>Deduction
allowed in computing adjusted gross income</header><text>Subsection (a) of
section 62 of such Code is amended by inserting before the last sentence the
following new paragraph:</text>
<quoted-block id="H38DFEE887C974C13B490D504F30E9D9F">
<paragraph id="H4E366D40DBF4428D9A62286784E6B5CC"><enum>(22)</enum><header>Costs of
qualified health insurance</header><text>The deduction allowed by section
224.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HB57A9CE10BF64AEF801705C86DC15168"><enum>(c)</enum><header>Clerical
amendment</header><text>The table of sections for part VII of subchapter B of
chapter 1 of such Code is amended by redesignating the item relating to section
224 as an item relating to section 225 and inserting before such item the
following new item:</text>
<quoted-block display-inline="no-display-inline" id="H2936D64D3AB345EB8BCB31774BB258EB" style="OLC">
<toc container-level="quoted-block-container" idref="H3E4D5AD32E2A4F438E0F12583A7E0F6A" lowest-bolded-level="division-lowest-bolded" lowest-level="section" quoted-block="no-quoted-block" regeneration="yes-regeneration">
<toc-entry idref="HCE908854A4F44D9BA3CC6A9558138CA5" level="section">Sec. 224. Costs of qualified health
insurance.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HC30E16F9D2FD44DEAD43D69AD3189838"><enum>(d)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to taxable
years beginning after December 31, 2009.</text>
</subsection></section><section id="HEF8C695BCE2547E89AD7475AF4DC28F6"><enum>105.</enum><header>Limitation on
abortion funding</header><text display-inline="no-display-inline">No funds
authorized under this Act (or any amendment made by this Act) may be used to
pay for any abortion or to cover any part of the costs of any health plan that
includes coverage of abortion, except in the case where a woman suffers from a
physical disorder, physical injury, or physical illness that would, as
certified by a physician, place the woman in danger of death unless an abortion
is performed, including a life-endangering physical condition caused by or
arising from the pregnancy itself, or unless the pregnancy is the result of an
act of forcible rape or incest.</text>
</section><section display-inline="no-display-inline" id="HE466D869945748E09949A863AEC65252"><enum>106.</enum><header>Non-discrimination
on abortion and respect for rights of conscience</header>
<subsection id="HCE71472DF4C7422B9C76F2E00679FBB1"><enum>(a)</enum><header>Non-Discrimination</header><text>A
Federal agency or program, and any State or local government that receives
Federal financial assistance, may not subject any individual or institutional
health care entity to discrimination on the basis that the health care entity
does not provide, pay for, provide coverage of, or refer for abortions.</text>
</subsection><subsection id="H70952D1FFE2F44499E2325AE787B2A77"><enum>(b)</enum><header>Definition</header><text>In
this section, the term <quote>health care entity</quote> includes an individual
physician or other health care professional, a hospital, a provider-sponsored
organization, a health maintenance organization, a health insurance plan, or
any other kind of health care facility, organization, or plan.</text>
</subsection><subsection id="HC9DFE786D43E48D7B1D6F82AD4DE8EA8"><enum>(c)</enum><header>Administration</header><text>The
Office for Civil Rights of the Department of Health and Human Services is
designated to receive complaints of discrimination based on this section, and
coordinate the investigation of such complaints.</text>
</subsection><subsection id="H138CFC447B0545019E45D36104467C85"><enum>(d)</enum><header>Conscientious
objection</header><text>Nothing in this Act shall be construed as forbidding a
health plan or health insurance issuer to accommodate the conscientious
objection of a purchaser or an individual or institutional health care provider
when a procedure is contrary to the religious beliefs or moral convictions of
such purchaser or provider.</text>
</subsection></section><section display-inline="no-display-inline" id="H002BA079020C4C34BF343A7328EA57C1" section-type="subsequent-section"><enum>107.</enum><header>Equal employer
contribution rule to promote choice</header>
<subsection id="H66BE17F395594FE9A08FC96BBAD62D2E"><enum>(a)</enum><header>Excise tax for
failure To provide contribution election</header><text>Section 5000 of the
Internal Revenue Code of 1986 is amended by adding at the end the following new
subsection:</text>
<quoted-block display-inline="no-display-inline" id="H0277E9F3F1084BD3B53EAAE80CABA788" style="OLC">
<subsection id="H28733A66BDB545FBAEBF2C9AA95D1C07"><enum>(e)</enum><header>Health care
contribution election</header>
<paragraph id="H01658A027EE042798C48455BFEF620FE"><enum>(1)</enum><header>In
general</header><text>Subsection (a) shall not apply in the case of a group
health plan with respect to which the requirements of paragraphs (2) and (3)
are met.</text>
</paragraph><paragraph id="H302E77EF60AB41878F2E0240704B06F3"><enum>(2)</enum><header>Contribution
election</header><text display-inline="yes-display-inline">The requirement of
this paragraph is met with respect to a group health plan if any employee of an
employer (who but for this paragraph would be covered by such plan) may elect
to have the employer or employee organization pay an amount which is not less
than the contribution amount to any provider of insurance (other than excepted
benefits as defined in section 9832(c)(1)) which constitutes medical care of
the individual or individual’s spouse or dependents in lieu of such group
health plan coverage otherwise provided or contributed to by the employer with
respect to such employee.</text>
</paragraph><paragraph display-inline="no-display-inline" id="H58A34EF6C4184A40B0FD83AD9F3F892C"><enum>(3)</enum><header>Pre-existing
conditions</header>
<subparagraph id="H02FA69DAD7584C76992B10E9EF7D644E"><enum>(A)</enum><header>In
general</header><text>The requirement of this paragraph is met with respect to
health insurance coverage provided to a participant or beneficiary by any
health insurance issuer if, under such plan the requirements of section 9801
are met with respect to the participant or beneficiary.</text>
</subparagraph><subparagraph id="H606BD95BC9364DF2B726677A243F9551"><enum>(B)</enum><header>Enforcement with
respect to individual election</header><text>For purposes of subparagraph (A),
any health insurance coverage with respect to the participant or beneficiary
shall be treated as health insurance coverage under a group health plan to
which section 9801 applies.</text>
</subparagraph></paragraph><paragraph id="H400B36FBE0AC4E5384E51D6326054AA1"><enum>(4)</enum><header>Contribution
amount</header><text>For purposes of this section, the term <term>contribution
amount</term> means, with respect to an individual under a group health plan,
the portion of the applicable premium of such individual under such plan (as
determined under section 4980B(f)(4)) which is not paid by the individual. In
the case that the employer offers more than one group health plan, the
contribution amount shall be the average amount of the applicable premiums
under such plans.</text>
</paragraph><paragraph id="H6CBC52931B4E493E9D6C0C9686E3A936"><enum>(5)</enum><header>Group health
plan</header><text display-inline="yes-display-inline">For purpose of this
subsection, subsection (d) shall not apply.</text>
</paragraph><paragraph id="H0A6393739ACA4194AF539C3E953B720D"><enum>(6)</enum><header>Application to
FEHBP</header><text>Notwithstanding any other provision of law, the Office of
Personnel Management shall carry out the health benefits program under chapter
89 of title 5, United States Code, consistent with the requirements of this
subsection.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HFCEA98D7BD224E678E5FB0A7F85ACC1B"><enum>(b)</enum><header>Requirement of
equal contributions to all FEHBP plans</header><text>Section 8906 of title 5,
United States Code, is amended by adding at the end the following new
subsection:</text>
<quoted-block display-inline="no-display-inline" id="HE94D55D22E8C4CA8B8259EEDBEF16A27" style="traditional">
<subsection id="H67886B71050946D6BD6EF7B13689A72B"><enum>(j)</enum><text>Notwithstanding
the previous provisions of this section the Office of Personnel Management
shall revise the amount of the Government contribution made under this section
in a manner so that—</text>
<paragraph id="HAAB878619B5D4079BDD9F7B3A88C19B9"><enum>(1)</enum><text>the amount of such
contribution does not change based on the health benefits plan in which the
individual is enrolled; and</text>
</paragraph><paragraph id="HB81B81AA7F3446498C2EA4DC5C8823BD"><enum>(2)</enum><text>the aggregate
amount of such contributions is estimated to be equal to the aggregate amount
of such contributions if this subsection did not
apply.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HAABDC1EB8C07458F94564AA148931167"><enum>(c)</enum><header>ERISA conforming
amendments</header>
<paragraph id="H16BF6A9B84794101AF87F76539103188"><enum>(1)</enum><header>Exception from
HIPAA requirements for benefits provided under health care contribution
election</header><text>Section 732 of the Employee Retirement Income Security
Act of 1974 (29 U.S.C. 1191a) is amended by adding at the end the following new
subsection:</text>
<quoted-block display-inline="no-display-inline" id="H54ACC54FDC164C13B49277E01C111347" style="OLC">
<subsection id="H92A679A48DC94256A38B6F6CB947BC0C"><enum>(e)</enum><header>Health care
contribution election</header>
<paragraph id="HD6B0E2EC9CCE40E88C71ECAF20018B2A"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">The requirements of
this part shall not apply in the case of health insurance coverage (other than
excepted benefits as defined in section 9832(c)(1) of the Internal Revenue Code
of 1986)—</text>
<subparagraph id="H7EFA311116264A20907C2C80A073E8C5"><enum>(A)</enum><text>which is provided
to a participant or beneficiary by a health insurance issuer under a group
health plan, and</text>
</subparagraph><subparagraph id="H0B20C7D4629F4429910E12A79561A622"><enum>(B)</enum><text>with respect to
which the requirements of paragraphs (2) and (3) are met.</text>
</subparagraph></paragraph><paragraph id="HCE74296C2C584BE1BB29A25588B5BD34"><enum>(2)</enum><header>Contribution
election</header><text display-inline="yes-display-inline">The requirement of
this paragraph is met with respect to health insurance coverage provided to a
participant or beneficiary by any health insurance issuer under a group health
plan if, under such plan—</text>
<subparagraph id="H50399C14EDD240D3BBF6B232AFD859DD"><enum>(A)</enum><text>the participant
may elect such coverage for any period of coverage in lieu of health insurance
coverage otherwise provided under such plan for such period, and</text>
</subparagraph><subparagraph id="HB1984697A9B64AE0BD34458399026DB3"><enum>(B)</enum><text>in the case of
such an election, the plan sponsor is required to pay to such issuer for the
elected coverage for such period an amount which is not less than the
contribution amount for such health insurance coverage otherwise provided under
such plan for such period.</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="HE5F452FF9FC44937B9DF213A1AE441F8"><enum>(3)</enum><header>Pre-existing
conditions</header>
<subparagraph id="H3C98BFBE80A74252A64E3444084D903C"><enum>(A)</enum><header>In
general</header><text>The requirement of this paragraph is met with respect to
health insurance coverage provided to a participant or beneficiary by any
health insurance issuer if, under such plan the requirements of section 701 are
met with respect to the participant or beneficiary.</text>
</subparagraph><subparagraph id="HEAD09D7088644E27817C10AA649CA957"><enum>(B)</enum><header>Enforcement with
respect to individual election</header><text>For purposes of subparagraph (A),
any health insurance coverage with respect to the participant or beneficiary
shall be treated as health insurance coverage under a group health plan to
which section 701 applies.</text>
</subparagraph></paragraph><paragraph id="H48E35918730A44339890EE7E60F7A894"><enum>(4)</enum><header>Contribution
amount</header>
<subparagraph id="H7DB05BA6F4484ED39A2EB5F7D58961D6"><enum>(A)</enum><header>In
general</header><text>For purposes of this section, the term <term>contribution
amount</term> means, with respect to any period of health insurance coverage
offered to a participant or beneficiary, the portion of the applicable premium
of such participant or beneficiary under such plan which is not paid by such
participant or beneficiary. In the case that the employer offers more than one
group health plan, the contribution amount shall be the average amount of the
applicable premiums under such plans.</text>
</subparagraph><subparagraph id="H4E71F17CA042412687555702ADB56D41"><enum>(B)</enum><header>Applicable
premium</header><text>For purposes of subparagraph (A), the term
<term>applicable premium</term> means, with respect to any period of health
insurance coverage of a participant or beneficiary under a group health plan,
the cost to the plan for such period of such coverage for similarly situated
beneficiaries (without regard to whether such cost is paid by the plan sponsor
or the participant or
beneficiary).</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph display-inline="no-display-inline" id="HDB5968981FDD42CAAA3A23E331457CFA"><enum>(2)</enum><header>Exemption from
fiduciary liability</header><text>Section 404 of such Act (29 U.S.C. 1104) is
amended by adding at the end the following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="H3A34E64CBB744054B3214B8AC21D8922" style="traditional">
<subsection id="H90A29F55328A471889357776080C6716"><enum>(e)</enum><text>The plan sponsor
of a group health plan (as defined in section 733(a)) shall not be treated as
breaching any of the responsibilities, obligations, or duties imposed upon
fiduciaries by this title in the case of any individual who is a participant or
beneficiary under such plan solely because of the extent to which the plan
sponsor provides, in the case of such individual, some or all of such benefits
by means of payment of contribution amounts pursuant to a contribution election
under section 732(e), irrespective of the amount or type of benefits that would
otherwise be provided to such individual under such
plan.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection display-inline="no-display-inline" id="HBA7F690BF0A243FEBA56C8F3097B5B49"><enum>(d)</enum><header>Exception from
HIPAA requirements under IRC for benefits provided under health care
contribution election</header><text>Section 9831 of the Internal Revenue Code
of 1986 (relating to general exceptions) is amended by adding at the end the
following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="H30C1E249B2DE4D8989C6CE966E8A7D0D" style="OLC">
<subsection id="H3F44B0E3704D4EA887FAF457D32B222A"><enum>(d)</enum><header>Health care
contribution election</header>
<paragraph id="H01BFEC046EA84A12B9C206B35CE97589"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">The requirements of
this chapter shall not apply in the case of health insurance coverage (other
than excepted benefits as defined in section 9832(c)(1))—</text>
<subparagraph id="HAB188CD30D2D4F0D81F4D18AF13B0222"><enum>(A)</enum><text>which is provided
to a participant or beneficiary by a health insurance issuer under a group
health plan, and</text>
</subparagraph><subparagraph id="H436EFDA2CFBA464589E489F75EFB17D7"><enum>(B)</enum><text>with respect to
which the requirements of paragraphs (2) and (3) are met.</text>
</subparagraph></paragraph><paragraph id="HBAB3586F60AE49AC97FC2C90649DED68"><enum>(2)</enum><header>Contribution
election</header><text display-inline="yes-display-inline">The requirement of
this paragraph is met with respect to health insurance coverage provided to a
participant or beneficiary by any health insurance issuer under a group health
plan if, under such plan—</text>
<subparagraph id="HD343C1A1CB8D4DBEA629B33317370B3B"><enum>(A)</enum><text>the participant
may elect such coverage for any period of coverage in lieu of health insurance
coverage otherwise provided under such plan for such period, and</text>
</subparagraph><subparagraph id="HE139AE6C3A9A41D0B7BBDB7830451570"><enum>(B)</enum><text>in the case of
such an election, the plan sponsor is required to pay to such issuer for the
elected coverage for such period an amount which is not less than the
contribution amount for such health insurance coverage otherwise provided under
such plan for such period.</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="H49BFDF74998F406892DEE32AC29EF030"><enum>(3)</enum><header>Pre-existing
conditions</header>
<subparagraph id="H2DADE88C3E9F4933979E9DA72A69BBF1"><enum>(A)</enum><header>In
general</header><text>The requirement of this paragraph is met with respect to
health insurance coverage provided to a participant or beneficiary by any
health insurance issuer if, under such plan the requirements of section 9801
are met with respect to the participant or beneficiary.</text>
</subparagraph><subparagraph id="H8620FC48B1CD4F38A8C0D2F51519E42D"><enum>(B)</enum><header>Enforcement with
respect to individual election</header><text>For purposes of subparagraph (A),
any health insurance coverage with respect to the participant or beneficiary
shall be treated as health insurance coverage under a group health plan to
which section 9801 applies.</text>
</subparagraph></paragraph><paragraph id="H65DA5E62C3E44109A326870472074F5F"><enum>(4)</enum><header>Contribution
amount</header>
<subparagraph id="H2ADA8DCD034649999F58F8406B9DC444"><enum>(A)</enum><header>In
general</header><text>For purposes of this subsection, the term
<term>contribution amount</term> means, with respect to any period of health
insurance coverage offered to a participant or beneficiary, the portion of the
applicable premium of such participant or beneficiary under such plan which is
not paid by such participant or beneficiary. In the case that the employer
offers more than one group health plan, the contribution amount shall be the
average amount of the applicable premiums under such plans.</text>
</subparagraph><subparagraph id="H549C6EC2C8344218A38F3F22FDA73E86"><enum>(B)</enum><header>Applicable
premium</header><text>For purposes of subparagraph (A), the term
<term>applicable premium</term> means, with respect to any period of health
insurance coverage of a participant or beneficiary under a group health plan,
the cost to the plan for such period of such coverage for similarly situated
beneficiaries (without regard to whether such cost is paid by the plan sponsor
or the participant or
beneficiary).</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H8F76035A2853463280886408139117F5"><enum>(e)</enum><header>Exception from
HIPAA requirements under the PHSA for benefits provided under health care
contribution election</header><text display-inline="yes-display-inline">Section
2721 of the Public Health Service Act (42 U.S.C. 300gg–21) is amended—</text>
<paragraph id="HF7035DAB28D94335819C67C2800D7BCC"><enum>(1)</enum><text>by redesignating
subsection (e) as subsection (f); and</text>
</paragraph><paragraph id="H8ECBA52E092B4ED08F7527083F0F830D"><enum>(2)</enum><text>by inserting after
subsection (d) the following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="H96DBCFB2AEE64A62A4E132F29EE5B26A" style="OLC">
<subsection id="HA9DC544E929C4103A774D9D4288AF985"><enum>(e)</enum><header>Health care
contribution election</header>
<paragraph id="H7C96CADA04874145BEAEA604CD512313"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">The requirements of
this subparts 1 through 3 shall not apply in the case of health insurance
coverage (other than excepted benefits as defined in section 9832(c)(1) of the
Internal Revenue Code of 1986)—</text>
<subparagraph id="H24C1C4529A914A52B988856857584053"><enum>(A)</enum><text>which is provided
to a participant or beneficiary by a health insurance issuer under a group
health plan, and</text>
</subparagraph><subparagraph id="HA36227E57B2144B489ED155E4C6979AA"><enum>(B)</enum><text>with respect to
which the requirements of paragraphs (2) and (3) are met.</text>
</subparagraph></paragraph><paragraph id="H1E942677EE3C42BAA4E707EB805363A2"><enum>(2)</enum><header>Contribution
election</header><text display-inline="yes-display-inline">The requirement of
this paragraph is met with respect to health insurance coverage provided to a
participant or beneficiary by any health insurance issuer under a group health
plan if, under such plan—</text>
<subparagraph id="H3240A0864AC14B9598C850DBE3B7D18E"><enum>(A)</enum><text>the participant
may elect such coverage for any period of coverage in lieu of health insurance
coverage otherwise provided under such plan for such period, and</text>
</subparagraph><subparagraph id="H7720DEF1959C402D9E30297CB97862FD"><enum>(B)</enum><text>in the case of
such an election, the plan sponsor is required to pay to such issuer for the
elected coverage for such period an amount which is not less than the
contribution amount for such health insurance coverage otherwise provided under
such plan for such period.</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="HADEE4618724E41CD814EF51FE934E516"><enum>(3)</enum><header>Pre-existing
conditions</header>
<subparagraph id="HF7238940323D4A0C922BA14D45FECF29"><enum>(A)</enum><header>In
general</header><text>The requirement of this paragraph is met with respect to
health insurance coverage provided to a participant or beneficiary by any
health insurance issuer if, under such plan the requirements of section 2701
are met with respect to the participant or beneficiary.</text>
</subparagraph><subparagraph id="H1FAC5046A5034AF99B6B78D62E06E6F8"><enum>(B)</enum><header>Enforcement with
respect to individual election</header><text>For purposes of subparagraph (A),
any health insurance coverage with respect to the participant or beneficiary
shall be treated as health insurance coverage under a group health plan to
which section 2701 applies.</text>
</subparagraph></paragraph><paragraph id="HABE41F74F5EE4845A0FC5B4611024509"><enum>(4)</enum><header>Contribution
amount</header>
<subparagraph id="H799C675BB9D744F9BAC10FCC48AF7CB8"><enum>(A)</enum><header>In
general</header><text>For purposes of this section, the term <term>contribution
amount</term> means, with respect to any period of health insurance coverage
offered to a participant or beneficiary, the portion of the applicable premium
of such participant or beneficiary under such plan which is not paid by such
participant or beneficiary. In the case that the employer offers more than one
group health plan, the contribution amount shall be the average amount of the
applicable premiums under such plans.</text>
</subparagraph><subparagraph id="H2C33E22C2106429C9BEE44B78627DACC"><enum>(B)</enum><header>Applicable
premium</header><text>For purposes of subparagraph (A), the term
<term>applicable premium</term> means, with respect to any period of health
insurance coverage of a participant or beneficiary under a group health plan,
the cost to the plan for such period of such coverage for similarly situated
beneficiaries (without regard to whether such cost is paid by the plan sponsor
or the participant or
beneficiary).</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection></section><section display-inline="no-display-inline" id="HE120615D622349D7AB338AFB0DFFC93B" section-type="subsequent-section"><enum>108.</enum><header>Limitations on State
restrictions on employer auto-enrollment</header>
<subsection id="HCC72B35B046A4675A232F423DEF7B209"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">No State shall
establish a law that prevents an employer from instituting auto-enrollment
which meets the requirements of subsection (b) for coverage of a participant or
beneficiary under a group health plan, or health insurance coverage offered in
connection with such a plan, so long as the participant or beneficiary has the
option of declining such coverage.</text>
</subsection><subsection display-inline="no-display-inline" id="HDB01AAD040F34A6388999FBD8387C98F"><enum>(b)</enum><header>Automatic
enrollment for employer sponsored health benefits</header>
<paragraph id="HE417BA8840844C85B49787F366E0FC49"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">The requirement of
this subsection with respect to an employer and an employee is that the
employer automatically enroll such employee into the employment-based health
benefits plan for individual coverage under the plan option with the lowest
applicable employee premium.</text>
</paragraph><paragraph id="H9653D1B740914D99AAA65CD2F9659156"><enum>(2)</enum><header>Opt-out</header><text>In
no case may an employer automatically enroll an employee in a plan under
paragraph (1) if such employee makes an affirmative election to opt-out of such
plan or to elect coverage under an employment-based health benefits plan
offered by such employer. An employer shall provide an employee with a 30-day
period to make such an affirmative election before the employer may
automatically enroll the employee in such a plan.</text>
</paragraph><paragraph id="H62F668597B964870934A8F50592E02D2"><enum>(3)</enum><header>Notice
requirements</header>
<subparagraph id="H02573765BFA64EEC93B34812B523F5E8"><enum>(A)</enum><header>In
general</header><text>Each employer described in paragraph (1) who
automatically enrolls an employee into a plan as described in such paragraph
shall provide the employees, within a reasonable period before the beginning of
each plan year (or, in the case of new employees, within a reasonable period
before the end of the enrollment period for such a new employee), written
notice of the employees’ rights and obligations relating to the automatic
enrollment requirement under such paragraph. Such notice must be comprehensive
and understood by the average employee to whom the automatic enrollment
requirement applies.</text>
</subparagraph><subparagraph id="HC896675B21364608904F33997E0CC5D7"><enum>(B)</enum><header>Inclusion of
specific information</header><text>The written notice under subparagraph (A)
must explain an employee’s right to opt out of being automatically enrolled in
a plan and in the case that more than one level of benefits or employee premium
level is offered by the employer involved, the notice must explain which level
of benefits and employee premium level the employee will be automatically
enrolled in the absence of an affirmative election by the employee.</text>
</subparagraph></paragraph></subsection><subsection id="H52BD6312AB5548B6BA3B94A402AEA18B"><enum>(c)</enum><header>Construction</header><text display-inline="yes-display-inline">Nothing in this section shall be construed
to supersede State law which establishes, implements, or continues in effect
any standard or requirement relating to employers in connection with payroll or
the sponsoring of employer sponsored health insurance coverage except to the
extent that such standard or requirement prevents an employer from instituting
the auto-enrollment described in subsection (a).</text>
</subsection></section><section display-inline="no-display-inline" id="H02F6D8622239457AB0F56EC194198998" section-type="subsequent-section"><enum>109.</enum><header>Credit for small
employers adopting auto-enrollment and defined contribution options</header>
<subsection id="H16D4AF604D894D2883F336C9B524E0D0"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subpart D of part IV
of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to
business-related credits) is amended by adding at the end the following new
section:</text>
<quoted-block display-inline="no-display-inline" id="HC7C4187855BC458BBBCEB910B8BCC4A8" style="OLC">
<section id="H440B3E8F205440078DD90AE7A71F8B26"><enum>45R.</enum><header>Auto-enrollment
and defined contribution option for health benefits plans of small
employers</header>
<subsection id="H0FAD738F92A24F7EB360F3C63E9DF044"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">For purposes of
section 38, in the case of a small employer, the health benefits plan
implementation credit determined under this section for the taxable year is an
amount equal to 100 percent of the amount paid or incurred by the taxpayer
during the taxable year for qualified health benefits expenses.</text>
</subsection><subsection id="H5F6E93132E204983876894CE84721DA4"><enum>(b)</enum><header>Limitation</header><text display-inline="yes-display-inline">The credit determined under subsection (a)
with respect to any taxpayer for any taxable year shall not exceed the excess
of—</text>
<paragraph id="HD10EBD2F45D4406DAA0E6129FDCE367D"><enum>(1)</enum><text>$1,500,
over</text>
</paragraph><paragraph id="H7440FB07E4AE4BAFAA1095D754A48167"><enum>(2)</enum><text>sum of the credits
determined under subsection (a) with respect to such taxpayer for all preceding
taxable years.</text>
</paragraph></subsection><subsection id="HBD87B91B65D14409BA345A902F742BCE"><enum>(c)</enum><header>Qualified health
benefits expenses</header><text display-inline="yes-display-inline">For
purposes of this section, the term <term>qualified health benefits
auto-enrollment expenses</term> means, with respect to any taxable year,
amounts paid or incurred by the taxpayer during such taxable year for—</text>
<paragraph id="HD5BFFA4C9A944B0DB791813D86B83D17"><enum>(1)</enum><text>establishing
auto-enrollment which meets the requirements of section 107 of the
<short-title>Siding with America’s Patients
Act</short-title> for coverage of a participant or beneficiary under a group
health plan, or health insurance coverage offered in connection with such a
plan, and</text>
</paragraph><paragraph id="H140492D36E004AC88741A2212CD77EEF"><enum>(2)</enum><text>implementing the
employer contribution option for health insurance coverage pursuant to section
5000(e)(2).</text>
</paragraph></subsection><subsection display-inline="no-display-inline" id="HF5BCE0E2CC1F4962ABE231DD112E51B4"><enum>(d)</enum><header>Qualified small
employer</header><text>For purposes of this section, the term <term>qualified
small employer</term> means any employer for any taxable year if the number of
employees employed by such employer during such taxable year does not exceed
50. All employers treated as a single employer under section (a) or (b) of
section 52 shall be treated as a single employer for purposes of this
section.</text>
</subsection><subsection id="H46DF1DAA0D774B438F1AD3D1F2802C0C"><enum>(e)</enum><header>No double
benefit</header><text>No deduction or credit shall be allowed under any other
provision of this chapter with respect to the amount of the credit determined
under this section.</text>
</subsection><subsection id="HE27A1555C61448DC8C6A117F163862CA"><enum>(f)</enum><header>Termination</header><text display-inline="yes-display-inline">Subsection (a) shall not apply to any
taxable year beginning after the date which is 2 years after the date of the
enactment of this
section.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H3FD680CB87444B98A1A7709569EE29D7"><enum>(b)</enum><header>Credit To be
part of general business credit</header><text>Subsection (b) of section 38 of
such Code (relating to general business credit) is amended by striking
<quote>plus</quote> at the end of paragraph (34), by striking the period at the
end of paragraph (35) and inserting <quote>, plus</quote> , and by adding at
the end the following new paragraph:</text>
<quoted-block id="H342BAB8047094F98BE1AA0832147FE70" style="OLC">
<paragraph id="H1304538996714F49AB68C7B50D0CE438"><enum>(36)</enum><text display-inline="yes-display-inline">in the case of a small employer (as defined
in section 45R(d)), the health benefits plan implementation credit determined
under section
45R(a).</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HC1C0368B93A244ABB65EA1EEFA42D34C"><enum>(c)</enum><header>Clerical
amendment</header><text>The table of sections for subpart D of part IV of
subchapter A of chapter 1 of such Code is amended by inserting after the item
relating to section 45Q the following new item:</text>
<quoted-block display-inline="no-display-inline" id="H40B28278F4F14978B63A4F28429DCFE3" style="OLC">
<toc container-level="quoted-block-container" idref="HC7C4187855BC458BBBCEB910B8BCC4A8" lowest-bolded-level="division-lowest-bolded" lowest-level="section" quoted-block="no-quoted-block" regeneration="yes-regeneration">
<toc-entry idref="H440B3E8F205440078DD90AE7A71F8B26" level="section">Sec. 45R. Auto-enrollment and defined contribution option for
health benefits plans of small
employers.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H8123A767ADB94DD3B965F67DC7E9EBF2"><enum>(d)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to taxable
years beginning after the date of the enactment of this Act.</text>
</subsection></section><section commented="no" id="H525B58F32FCB4159B1F301776376C769"><enum>110.</enum><header>Require
employers to disclose amounts paid for employer-provided health plan
coverage</header>
<subsection id="H87CDD77101FA4E0F96F771769E787F97"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subsection (a) of
section 6051 is amended by striking <quote>and</quote> at the end of paragraph
(12), by striking the period at the end of paragraph (13) and inserting
<quote>, and</quote>, and by inserting after paragraph (13) the following new
paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H30C6776A101B4D53A871EC3ABFFD9F77" style="OLC">
<paragraph id="H0918FFA8826740079B4B2F82F679BD3E"><enum>(14)</enum><text display-inline="yes-display-inline">the total amount paid or incurred by the
employer with respect to employer-provided coverage under an accident or health
plan with respect to such
employee.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HD4C2647495B340899D8B14949E008286"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to amounts
paid or incurred in calendar years beginning after the date of the enactment of
this Act.</text>
</subsection></section><section id="H65338827BC0A43A681A2D0518907749A"><enum>111.</enum><header>HSA
modifications and clarifications</header>
<subsection commented="no" display-inline="no-display-inline" id="H1ED04DFA8F814AC4A8D0DE6A1E800C48"><enum>(a)</enum><header display-inline="yes-display-inline">Clarification of treatment of capitated
primary care payments as amounts paid for medical care</header><text display-inline="yes-display-inline">Section 213(d) of the Internal Revenue Code
of 1986 (relating to definitions) is amended by adding at the end the following
new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H4F3AEC846F2C4DEF9D9CC854096E5CF0" style="OLC">
<paragraph commented="no" display-inline="no-display-inline" id="HE3347FFAB0134668B43BB30BDF0316AC"><enum>(12)</enum><header display-inline="yes-display-inline">Treatment of capitated primary care
payments</header><text display-inline="yes-display-inline">Capitated primary
care payments shall be treated as amounts paid for medical
care.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HC49C3C0527314F55B9C488E5C3920195"><enum>(b)</enum><header display-inline="yes-display-inline">Special rule for individuals eligible for
veterans or Indian health benefits</header><text display-inline="yes-display-inline">Section 223(c)(1) of such Code (defining
eligible individual) is amended by adding at the end the following new
subparagraph:</text>
<quoted-block display-inline="no-display-inline" id="H99D8DAA57A3F416189E640762C492F1D" style="OLC">
<subparagraph commented="no" display-inline="no-display-inline" id="HF020E88FED154E58A66DEE69B7E59B32"><enum>(C)</enum><header display-inline="yes-display-inline">Special rule for individuals eligible for
veterans or Indian health benefits</header><text display-inline="yes-display-inline">For purposes of subparagraph (A)(ii), an
individual shall not be treated as covered under a health plan described in
such subparagraph merely because the individual receives periodic hospital care
or medical services under any law administered by the Secretary of Veterans
Affairs or the Bureau of Indian
Affairs.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H6BF11A6FA3F14CF58B8DCDF59BD24DF8"><enum>(c)</enum><header>Certain
physician fees To be treated as medical care</header><text>Section 213(d) of
such Code is amended by adding at the end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H5C42C6E932FD4D7BAAE5D0286C0CED0E" style="OLC">
<paragraph id="HE8EC920CC9E145DEBE74BD16CA53CCA0"><enum>(12)</enum><header>Pre-paid
physician fees</header><text>The term <term>medical care</term> shall include
amounts paid by patients to their primary physician in advance for the right to
receive medical services on an as-needed
basis.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HAC561248F754442792775749804AFDC8"><enum>(d)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to taxable
years beginning after the date of the enactment of this Act.</text>
</subsection></section><enum>II</enum><header>Health Insurance
Pooling Mechanisms for Individuals</header>
<subtitle id="H67C78D0FF800434390A4AB65E0D77928"><enum>A</enum><header>Safety Net for
Individuals with Pre-Existing Conditions</header>
<section id="H0220CBF1434F4A219C485EA25FDF3C92"><enum>201.</enum><header>Requiring
operation of high-risk pool or other mechanism as condition for availability of
tax credit</header><text display-inline="no-display-inline">No credit shall be
allowed under section 36B of the Internal Revenue Code of 1986 (relating to
health insurance costs of low-income individuals) to the residents of any State
unless such State meets the following requirements:</text>
<paragraph id="H12894495544C49EF90F212E68779ECFD"><enum>(1)</enum><text display-inline="yes-display-inline">The State must implement a high-risk pool
or a reinsurance pool or other risk-adjustment mechanism (as defined in section
211).</text>
</paragraph><paragraph id="HDBFDF3FD9167439581A7206FE59631CE"><enum>(2)</enum><text>Assessments levied
by the State for purposes of funding such a pool or mechanism must only be used
for funding and administering such pool or mechanism.</text>
</paragraph><paragraph id="H9AF51D43B6964F519EC1F757BB1C9F03"><enum>(3)</enum><text>Such pool or
mechanism must incorporate the application of such tax credit into such pool or
mechanism.</text>
</paragraph></section></subtitle><subtitle id="H7BC97984AB5E4F2899736329C35B0476"><enum>B</enum><header>Federal Block
Grants for State Insurance Expenditures</header>
<section id="H9C67CDB9AFE8449090AB3E69353D279B"><enum>211.</enum><header>Federal block
grants for State insurance expenditures</header>
<subsection id="H84E9EA97E0B445B3B915186DBC06977C"><enum>(a)</enum><header>In
General</header><text display-inline="yes-display-inline">Subject to the
succeeding provisions of this section, each State shall receive from the
Secretary of Health and Human Services (in this subtitle referred to as the
<quote>Secretary</quote>) a block grant for the State’s providing for the use,
in connection with providing health benefits coverage, of a qualifying
high-risk pool or a reinsurance pool or other risk-adjustment mechanism used
for the purpose of subsidizing the purchase of private health insurance.</text>
</subsection><subsection id="H54BF2B4946AC482384760D5A74BE6382"><enum>(b)</enum><header>Funding
amount</header>
<paragraph id="HA8C5351015184F3A9A35051E529DB9E5"><enum>(1)</enum><header>In
general</header><text>There are hereby appropriated, out of any funds in the
Treasury not otherwise appropriated, $300,000,000 for each fiscal year for
block grants under this section. Such amount shall be divided among the States
as determined by the Secretary.</text>
</paragraph><paragraph id="H3E1957F8B92E42BF855250F490352293"><enum>(2)</enum><header>Construction</header><text>Nothing
in this section shall be construed as preventing a State from using funding
under section 2745 of the Public Health Service Act for purposes of funding
reinsurance or other risk mechanisms.</text>
</paragraph></subsection><subsection id="H9DE76534C1ED46569E369F73CC350DF3"><enum>(c)</enum><header>Limitation</header><text>Funding
under subsection (a) may only be used for the following:</text>
<paragraph id="H1C1738D8F65B4F229945D3051D33B19E"><enum>(1)</enum><header>Qualifying
high-risk pools</header>
<subparagraph id="H7F1B6C686B6547E3A728E3F3F4F4CA89"><enum>(A)</enum><header>Current
pools</header><text display-inline="yes-display-inline">A qualifying high-risk
pool created before the date of the enactment of this Act that only cover high
risk populations and individuals (and their spouse and dependents) receiving a
health care tax credit under section 35 of the Internal Revenue Code of 1986
for a limited period of time as determined by the Secretary or under section
2741 of Public Health Service Act.</text>
</subparagraph><subparagraph id="H39AC60AAFC89420D84E727F4D136F4C9"><enum>(B)</enum><header>New
pools</header><text display-inline="yes-display-inline">A qualifying high-risk
pool created on or after such date that only covers populations and individuals
described in subparagraph (A) if the pool—</text>
<clause id="HF72E42441E8348D4922919077BB8DD21"><enum>(i)</enum><text>offers at least
the option of one or more high deductible plan options, in combination with a
contribution into a health savings account;</text>
</clause><clause id="H9119F80A74FB41F3BEFE95F872EB092A"><enum>(ii)</enum><text>offers multiple
competing health plan options; and</text>
</clause><clause id="H9138C6A95BFE4CCB8BB5FA5821B51EF2"><enum>(iii)</enum><text>covers only high
risk populations.</text>
</clause></subparagraph></paragraph><paragraph id="HC9B431ABAE1F4ABB974AA33DCD5A4BEC"><enum>(2)</enum><header>Risk insurance
pool or other risk-adjustment mechanisms</header>
<subparagraph id="HDFFDE9BEF0014E988DB846F2912C3B49"><enum>(A)</enum><header>Current
reinsurance</header><text display-inline="yes-display-inline">A reinsurance
pool ,or other risk-adjustment mechanism, created before the date of the
enactment of this Act that only covers populations and individuals described in
paragraph (1)(A).</text>
</subparagraph><subparagraph id="H8B6018B78BA34F98A237B2ECE7F83DE3"><enum>(B)</enum><header>New
pools</header><text display-inline="yes-display-inline">A reinsurance pool or
other risk-adjustment mechanism created on or after such date that provides
reinsurance only covers populations and individuals described in paragraph
(1)(A) and only on a prospective basis under which a health insurance issuer
cedes covered lives to the pool in exchange for payment of a reinsurance
premium.</text>
</subparagraph></paragraph><paragraph id="H2AFBBC0B04AE4128ACECE05BFB84AB10"><enum>(3)</enum><header>Transition</header><text>Nothing
in this section shall be construed as preventing a State from using funds
available to transition from an existing high-risk pool to a reinsurance
pool.</text>
</paragraph></subsection><subsection id="H89A4ABDCA88646DB962DF18BEF275828"><enum>(d)</enum><header>Bonus
payments</header><text display-inline="yes-display-inline">With respect to any
amounts made available to the States under this section, the Secretary shall
set aside a portion of such amounts that shall only be available for the
following activities by such States:</text>
<paragraph id="H83030C3B121141F1A959E36386296EEC"><enum>(1)</enum><text display-inline="yes-display-inline">Providing guaranteed availability of
individual health insurance coverage to certain individuals with prior group
coverage under part B of title XXVII of the Public Health Service Act.</text>
</paragraph><paragraph id="HD71A981A09A24D79B25E270923F1447F"><enum>(2)</enum><text display-inline="yes-display-inline">A reduction in premium trends, actual
premiums, or other cost-sharing requirements.</text>
</paragraph><paragraph id="H6D8D7351066E477089A1BAA9393613BC"><enum>(3)</enum><text>An expansion or
broadening of the pool of high risk individuals eligible for coverage.</text>
</paragraph><paragraph id="HCEEEF529203C4A10B53C64DA9095C78C"><enum>(4)</enum><text>States that adopt
the Model Health Plan for Uninsurable Individuals Act of the National
Association of Insurance Commissioners (if and when updated by such
Association).</text>
</paragraph><continuation-text continuation-text-level="subsection">The
Secretary may request such Association to update such Model Health Plan as
needed by 2011.</continuation-text></subsection><subsection id="H6696AAAB87A64D4AADAB1CC0C4AED01F"><enum>(e)</enum><header>Administration</header><text>The
Secretary shall provide for the administration of this section and may
establish such terms and conditions, including the requirement of an
application, as may be appropriate to carry out this section.</text>
</subsection><subsection id="HAED725E42F4D49929CA75CA94C171CBE"><enum>(f)</enum><header>Construction</header><text>Nothing
in this section shall be construed as requiring a State to operate a
reinsurance pool (or other risk-adjustment mechanism) under this section or as
preventing a State from operating such a pool or mechanism through one or more
private entities.</text>
</subsection><subsection id="H9C28086A88FD48F79536D4A53A966205"><enum>(g)</enum><header>Qualifying
high-Risk pool</header><text>For purposes of this section, the term
<term>qualifying high-risk pool</term> means any qualified high risk pool (as
defined in subsection (g)(1)(A) of section 2745) of the
<act-name parsable-cite="PHSA">Public Health Service Act</act-name>) that meets
the conditions to receive a grant under section (b)(1) of such section.</text>
</subsection><subsection id="H89D3B6CC49324D9EA799894700777B2D"><enum>(h)</enum><header>Reinsurance pool
or other risk-Adjustment mechanism defined</header><text>For purposes of this
section, the term <term>reinsurance pool or other risk-adjustment
mechanism</term> means any State-based risk spreading mechanism to subsidize
the purchase of private health insurance for the high-risk population.</text>
</subsection><subsection id="HE8B842165BE84ED5BA4E4B04D962C154"><enum>(i)</enum><header>High-Risk
population</header><text>For purposes of this section, the term <term>high-risk
population</term> means—</text>
<paragraph id="H60917B6DDB724B08AE3F31F8DDA1365F"><enum>(1)</enum><text>individuals who,
by reason of the existence or history of a medical condition, are able to
acquire health coverage only at rates which are at least 150 percent of the
standard risk rates for such coverage (in a non-community-rated non-guaranteed
issue State), and</text>
</paragraph><paragraph id="H8C513A98DF844FD99DC01E54B3AE21EE"><enum>(2)</enum><text>individuals who
are provided health coverage by a high-risk pool.</text>
</paragraph></subsection><subsection id="H7FEA9AEFCDE043DCA0DF3BF6C9533175"><enum>(j)</enum><header>State
defined</header><text>For purposes of this section, the term <term>State</term>
includes the District of Columbia, Puerto Rico, the Virgin Islands, Guam,
American Samoa, and the Northern Mariana Islands.</text>
</subsection><subsection id="H01B12C65E15244E88F805135BC84281B"><enum>(k)</enum><header>Extending
funding</header><text>Section 2745(d)(2) of the Public Health Service Act (42
U.S.C. 300gg–45(d)(2)) is amended by striking <quote>2010</quote> and inserting
<quote>2012</quote> each place it appears.</text>
</subsection></section></subtitle><subtitle id="H504A79720246470ABB39E6F68B96984D"><enum>C</enum><header>Health Care Access
and Availability</header>
<section id="H74FDB53900134DDC820746ED28D58A56"><enum>221.</enum><header>Expansion of
access and choice through individual membership associations
(IMAs)</header><text display-inline="no-display-inline">The
<act-name parsable-cite="PHSA">Public Health Service Act</act-name> is amended
by adding at the end the following new title:</text>
<quoted-block act-name="Public Health Service Act" id="H4E85289AD463416AB88C128A88DAFAD8">
<title id="H9EE71CC250254FEBA2F3B57E754B9594"><enum>XXXI</enum><header>Individual
Membership Associations</header>
<section id="H84484F588EC8443DB25A4F4E9620A89B"><enum>3101.</enum><header>Definition of
individual membership association (IMA)</header>
<subsection id="H3EE103B864D64F96BB5848CDE664E2EB"><enum>(a)</enum><header>In
General</header><text>For purposes of this title, the terms <term>individual
membership association</term> and <term>IMA</term> mean a legal entity that
meets the following requirements:</text>
<paragraph id="HA756F16F89344406849D03F9D88EF47F"><enum>(1)</enum><header>Organization</header><text>The
IMA is an organization operated under the direction of an association (as
defined in section 3104(1)).</text>
</paragraph><paragraph id="HD261485E4C6E4A4A98DA43F4E6AB25D9"><enum>(2)</enum><header>Offering health
benefits coverage</header>
<subparagraph id="H6F2C1CDFBCFE44E3A216C8856A719CFB"><enum>(A)</enum><header>Different
groups</header><text>The IMA, in conjunction with those health insurance
issuers that offer health benefits coverage through the IMA, makes available
health benefits coverage in the manner described in subsection (b) to all
members of the IMA and the dependents of such members in the manner described
in subsection (c)(2) at rates that are established by the health insurance
issuer on a policy or product specific basis and that may vary only as
permissible under State law.</text>
</subparagraph><subparagraph id="H51358A4164864860B821B37E4078AD96"><enum>(B)</enum><header>Nondiscrimination
in coverage offered</header>
<clause id="HBF9972FE7C304560BBA5EA819C932FD3"><enum>(i)</enum><header>In
General</header><text>Subject to clause (ii), the IMA may not offer health
benefits coverage to a member of an IMA unless the same coverage is offered to
all such members of the IMA.</text>
</clause><clause id="H9FB1DD51CEC54697BDC2ABB9DB093E7D"><enum>(ii)</enum><header>Construction</header><text>Nothing
in this title shall be construed as requiring or permitting a health insurance
issuer to provide coverage outside the service area of the issuer, as approved
under State law, or requiring a health insurance issuer from excluding or
limiting the coverage on any individual, subject to the requirement of section
2741.</text>
</clause></subparagraph><subparagraph id="H470AB6F1DEAE4FC9A6FA4666754B0024"><enum>(C)</enum><header>No financial
underwriting</header><text>The IMA provides health benefits coverage only
through contracts with health insurance issuers and does not assume insurance
risk with respect to such coverage.</text>
</subparagraph></paragraph><paragraph id="H7F436BD37C914B50B6AB270F8F8B5DEA"><enum>(3)</enum><header>Geographic
areas</header><text>Nothing in this title shall be construed as preventing the
establishment and operation of more than one IMA in a geographic area or as
limiting the number of IMAs that may operate in any area.</text>
</paragraph><paragraph id="H9FD013F5197B4AB19982C54DAA9D0B10"><enum>(4)</enum><header>Provision of
administrative services to purchasers</header>
<subparagraph id="H03999D655DBD427D8680CD00FE40E6C4"><enum>(A)</enum><header>In
General</header><text>The IMA may provide administrative services for members.
Such services may include accounting, billing, and enrollment
information.</text>
</subparagraph><subparagraph id="H6DB621D220A54675806652DE9322B310"><enum>(B)</enum><header>Construction</header><text>Nothing
in this subsection shall be construed as preventing an IMA from serving as an
administrative service organization to any entity.</text>
</subparagraph></paragraph><paragraph id="H42EDCD927B104871BD69287B31D30B96"><enum>(5)</enum><header>Filing
information</header><text>The IMA files with the Secretary information that
demonstrates the IMA’s compliance with the applicable requirements of this
title.</text>
</paragraph></subsection><subsection id="H8008364E04CA4FF78555A0932C97F3DD"><enum>(b)</enum><header>Health benefits
coverage requirements</header>
<paragraph id="HCF6A513615424D62A90CDE1E55FB2B16"><enum>(1)</enum><header>Compliance with
consumer protection requirements</header><text>Any health benefits coverage
offered through an IMA shall—</text>
<subparagraph id="H972AB6CBE66D40FA89984AD1543EC003"><enum>(A)</enum><text>be underwritten by
a health insurance issuer that—</text>
<clause id="HDFBA7B01A1AE4398B40A869C00DCEC5B"><enum>(i)</enum><text>is
licensed (or otherwise regulated) under State law, and</text>
</clause><clause id="H471AF7C36B234964A8F3FC8E0CEE05E0"><enum>(ii)</enum><text>meets all
applicable State standards relating to consumer protection, subject to section
3002(b), and</text>
</clause></subparagraph><subparagraph id="H92F36C5DD80948939CF05FFCF11064C8"><enum>(B)</enum><text>subject to
paragraph (2), be approved or otherwise permitted to be offered under State
law.</text>
</subparagraph></paragraph><paragraph id="H0CA74652619E442DBB27CBCB95B1C59B"><enum>(2)</enum><header>Examples of
types of coverage</header><text>The benefits coverage made available through an
IMA may include, but is not limited to, any of the following if it meets the
other applicable requirements of this title:</text>
<subparagraph id="HE66E1C473EDA471C94D367BC6C968FE9"><enum>(A)</enum><text>Coverage through a
health maintenance organization.</text>
</subparagraph><subparagraph id="H300BD4FD46AE4BF5B82F4BE5C43940A8"><enum>(B)</enum><text>Coverage in
connection with a preferred provider organization.</text>
</subparagraph><subparagraph id="H0E780C9523E540AD9937F9901DFFB41A"><enum>(C)</enum><text>Coverage in
connection with a licensed provider-sponsored organization.</text>
</subparagraph><subparagraph id="H871B2FAE559249D2A1C650D40CB717DD"><enum>(D)</enum><text>Indemnity coverage
through an insurance company.</text>
</subparagraph><subparagraph id="HB717A589A5D443FBB08D2E384AF1D49C"><enum>(E)</enum><text>Coverage offered
in connection with a contribution into a medical savings account or flexible
spending account.</text>
</subparagraph><subparagraph id="H34A7EA33A2D24A26A79AC6F182186BE9"><enum>(F)</enum><text>Coverage that
includes a point-of-service option.</text>
</subparagraph><subparagraph id="HC6F04E3131224604A9B463508A45C69D"><enum>(G)</enum><text>Any combination of
such types of coverage.</text>
</subparagraph></paragraph><paragraph id="H68E9C824493A4581B5294F8D788FB615"><enum>(3)</enum><header>Wellness bonuses
for health promotion</header><text>Nothing in this title shall be construed as
precluding a health insurance issuer offering health benefits coverage through
an IMA from establishing premium discounts or rebates for members or from
modifying otherwise applicable copayments or deductibles in return for
adherence to programs of health promotion and disease prevention so long as
such programs are agreed to in advance by the IMA and comply with all other
provisions of this title and do not discriminate among similarly situated
members.</text>
</paragraph></subsection><subsection id="HBFBC600C45DF421C88C2BC3106710AE2"><enum>(c)</enum><header>Members; health
insurance issuers</header>
<paragraph id="HFFCCE2FFD7694340952CB3FAEC344AB9"><enum>(1)</enum><header>Members</header>
<subparagraph id="H11A52247ABC84C2AA2F4D92F7DEEB5C5"><enum>(A)</enum><header>In
General</header><text>Under rules established to carry out this title, with
respect to an individual who is a member of an IMA, the individual may enroll
for health benefits coverage (including coverage for dependents of such
individual) offered by a health insurance issuer through the IMA.</text>
</subparagraph><subparagraph id="HAC74F52EF0064E788D0B6341EF5904AF"><enum>(B)</enum><header>Rules for
enrollment</header><text>Nothing in this paragraph shall preclude an IMA from
establishing rules of enrollment and reenrollment of members. Such rules shall
be applied consistently to all members within the IMA and shall not be based in
any manner on health status-related factors.</text>
</subparagraph></paragraph><paragraph id="H322372E2D7DF4BD4A3F202FCB32F71D7"><enum>(2)</enum><header>Health insurance
issuers</header><text>The contract between an IMA and a health insurance issuer
shall provide, with respect to a member enrolled with health benefits coverage
offered by the issuer through the IMA, for the payment of the premiums
collected by the issuer.</text>
</paragraph></subsection></section><section id="H92C1763EA3E443AF9E234DD37DE93261"><enum>3102.</enum><header>Application of
certain laws and requirements</header><text display-inline="no-display-inline">State laws insofar as they relate to any of
the following are superseded and shall not apply to health benefits coverage
made available through an IMA:</text>
<paragraph id="H05EC1799C78F40899714C3D33125D9D3"><enum>(1)</enum><text>Benefit
requirements for health benefits coverage offered through an IMA, including
(but not limited to) requirements relating to coverage of specific providers,
specific services or conditions, or the amount, duration, or scope of benefits,
but not including requirements to the extent required to implement title XXVII
or other Federal law and to the extent the requirement prohibits an exclusion
of a specific disease from such coverage.</text>
</paragraph><paragraph id="HED65AA694C2945B0870C1C50ACEACFCF"><enum>(2)</enum><text>Any other
requirements (including limitations on compensation arrangements) that,
directly or indirectly, preclude (or have the effect of precluding) the
offering of such coverage through an IMA, if the IMA meets the requirements of
this title.</text>
</paragraph><continuation-text continuation-text-level="section">Any State
law or regulation relating to the composition or organization of an IMA is
preempted to the extent the law or regulation is inconsistent with the
provisions of this title.</continuation-text></section><section id="H6B01BD23946842F4B982E84144B96D4E"><enum>3103.</enum><header>Administration</header>
<subsection id="H4DE8E415F66E48A7B2F1DF1CA80E2175"><enum>(a)</enum><header>In
General</header><text>The Secretary shall administer this title and is
authorized to issue such regulations as may be required to carry out this
title. Such regulations shall be subject to Congressional review under the
provisions of chapter 8 of title 5, United States Code. The Secretary shall
incorporate the process of <quote>deemed file and use</quote> with respect to
the information filed under section 3001(a)(5)(A) and shall determine whether
information filed by an IMA demonstrates compliance with the applicable
requirements of this title. The Secretary shall exercise authority under this
title in a manner that fosters and promotes the development of IMAs in order to
improve access to health care coverage and services.</text>
</subsection><subsection id="H82B47CDC8E04457A8CCBB091692EB068"><enum>(b)</enum><header>Periodic
reports</header><text>The Secretary shall submit to Congress a report every 30
months, during the 10-year period beginning on the effective date of the rules
promulgated by the Secretary to carry out this title, on the effectiveness of
this title in promoting coverage of uninsured individuals. The Secretary may
provide for the production of such reports through one or more contracts with
appropriate private entities.</text>
</subsection></section><section id="HB4A3D820C23D4F07853ABD8E85858D84"><enum>3104.</enum><header>Definitions</header><text display-inline="no-display-inline">For purposes of this title:</text>
<paragraph id="H4B3EC99D3DE8445893491B7150B2F7DE"><enum>(1)</enum><header>Association</header><text>The
term <term>association</term> means, with respect to health insurance coverage
offered in a State, an association which—</text>
<subparagraph id="HD95662DEBEBA4C6A850C3F59F81E3C53"><enum>(A)</enum><text>has been actively
in existence for at least 5 years;</text>
</subparagraph><subparagraph id="H8AE7424F639F49ADBC565CF8C3F89FFA"><enum>(B)</enum><text>has been formed
and maintained in good faith for purposes other than obtaining
insurance;</text>
</subparagraph><subparagraph id="HEA32C933F6DB46A9923887C95EEDC950"><enum>(C)</enum><text>does not condition
membership in the association on any health status-related factor relating to
an individual (including an employee of an employer or a dependent of an
employee); and</text>
</subparagraph><subparagraph id="H63F50DA302094A5EADFC39EC78FCE984"><enum>(D)</enum><text>does not make
health insurance coverage offered through the association available other than
in connection with a member of the association.</text>
</subparagraph></paragraph><paragraph id="H4858FC7E29904AE4A82261CE15EDE1D2"><enum>(2)</enum><header>Dependent</header><text>The
term <term>dependent</term>, as applied to health insurance coverage offered by
a health insurance issuer licensed (or otherwise regulated) in a State, shall
have the meaning applied to such term with respect to such coverage under the
laws of the State relating to such coverage and such an issuer. Such term may
include the spouse and children of the individual involved.</text>
</paragraph><paragraph id="HC2939DC281BA4C02A3CE6325778E5AE2"><enum>(3)</enum><header>Health benefits
coverage</header><text>The term <term>health benefits coverage</term> has the
meaning given the term health insurance coverage in section 2791(b)(1).</text>
</paragraph><paragraph id="H0A6F59683D0848C8BDC71D99594E1EB9"><enum>(4)</enum><header>Health insurance
issuer</header><text>The term <term>health insurance issuer</term> has the
meaning given such term in section 2791(b)(2).</text>
</paragraph><paragraph id="HCB2F04AA372246A1B83EFB7DF757A98E"><enum>(5)</enum><header>Health
status-related factor</header><text>The term <term>health status-related
factor</term> has the meaning given such term in section 2791(d)(9).</text>
</paragraph><paragraph id="H8A5C5EB5B8164F72BC5291DD54BF4AA1"><enum>(6)</enum><header>IMA; individual
membership association</header><text>The terms <term>IMA</term> and
<term>individual membership association</term> are defined in section
3101(a).</text>
</paragraph><paragraph id="HF368140CBC964DC0AF6A873C722D31BC"><enum>(7)</enum><header>Member</header><text>The
term <term>member</term> means, with respect to an IMA, an individual who is a
member of the association to which the IMA is offering
coverage.</text>
</paragraph></section>.
DSmall Business
Health Fairness
231.This subtitle may be
cited as the Small Business Health
Fairness Act of 2009
.
232.Rules governing
association health plans
(a)Subtitle B of title I
of the Employee Retirement Income Security Act
of 1974 is amended by adding after part 7 the following new
part:
8RULES GOVERNING
ASSOCIATION HEALTH PLANS
801.
(a)For purposes of this part, the term association
health plan means a group health plan whose sponsor is (or is deemed
under this part to be) described in subsection (b).
(b)The
sponsor of a group health plan is described in this subsection if such
sponsor—
(1)is organized and
maintained in good faith, with a constitution and bylaws specifically stating
its purpose and providing for periodic meetings on at least an annual basis, as
a bona fide trade association, a bona fide industry association (including a
rural electric cooperative association or a rural telephone cooperative
association), a bona fide professional association, or a bona fide chamber of
commerce (or similar bona fide business association, including a corporation or
similar organization that operates on a cooperative basis (within the meaning
of section 1381 of the Internal Revenue Code of 1986)), for substantial
purposes other than that of obtaining or providing medical care;
(2)is established as
a permanent entity which receives the active support of its members and
requires for membership payment on a periodic basis of dues or payments
necessary to maintain eligibility for membership in the sponsor; and
(3)does not condition
membership, such dues or payments, or coverage under the plan on the basis of
health status-related factors with respect to the employees of its members (or
affiliated members), or the dependents of such employees, and does not
condition such dues or payments on the basis of group health plan
participation.
Any
sponsor consisting of an association of entities which meet the requirements of
paragraphs (1), (2), and (3) shall be deemed to be a sponsor described in this
subsection.802.Certification
of association health plans
(a)The applicable authority shall prescribe by regulation a
procedure under which, subject to subsection (b), the applicable authority
shall certify association health plans which apply for certification as meeting
the requirements of this part.
(b)Under
the procedure prescribed pursuant to subsection (a), in the case of an
association health plan that provides at least one benefit option which does
not consist of health insurance coverage, the applicable authority shall
certify such plan as meeting the requirements of this part only if the
applicable authority is satisfied that the applicable requirements of this part
are met (or, upon the date on which the plan is to commence operations, will be
met) with respect to the plan.
(c)Requirements
Applicable to Certified PlansAn association health plan with
respect to which certification under this part is in effect shall meet the
applicable requirements of this part, effective on the date of certification
(or, if later, on the date on which the plan is to commence operations).
(d)Requirements for
Continued CertificationThe applicable authority may provide by
regulation for continued certification of association health plans under this
part.
(e)Class
Certification for Fully Insured PlansThe applicable authority
shall establish a class certification procedure for association health plans
under which all benefits consist of health insurance coverage. Under such
procedure, the applicable authority shall provide for the granting of
certification under this part to the plans in each class of such association
health plans upon appropriate filing under such procedure in connection with
plans in such class and payment of the prescribed fee under section
807(a).
(f)Certification of
Self-Insured Association Health PlansAn association health plan
which offers one or more benefit options which do not consist of health
insurance coverage may be certified under this part only if such plan consists
of any of the following:
(1)a plan which
offered such coverage on the date of the enactment of the
Small Business Health Fairness Act of
2009,
(2)a plan under which
the sponsor does not restrict membership to one or more trades and businesses
or industries and whose eligible participating employers represent a broad
cross-section of trades and businesses or industries, or
(3)a plan whose
eligible participating employers represent one or more trades or businesses, or
one or more industries, consisting of any of the following: agriculture;
equipment and automobile dealerships; barbering and cosmetology; certified
public accounting practices; child care; construction; dance, theatrical and
orchestra productions; disinfecting and pest control; financial services;
fishing; food service establishments; hospitals; labor organizations; logging;
manufacturing (metals); mining; medical and dental practices; medical
laboratories; professional consulting services; sanitary services;
transportation (local and freight); warehousing; wholesaling/distributing; or
any other trade or business or industry which has been indicated as having
average or above-average risk or health claims experience by reason of State
rate filings, denials of coverage, proposed premium rate levels, or other means
demonstrated by such plan in accordance with regulations.
803.Requirements
relating to sponsors and boards of trustees
(a)The
requirements of this subsection are met with respect to an association health
plan if the sponsor has met (or is deemed under this part to have met) the
requirements of section 801(b) for a continuous period of not less than 3 years
ending with the date of the application for certification under this
part.
(b)The requirements of this subsection are met with respect
to an association health plan if the following requirements are met:
(1)The plan is operated, pursuant to a trust agreement, by a
board of trustees which has complete fiscal control over the plan and which is
responsible for all operations of the plan.
(2)Rules of
operation and financial controlsThe board of trustees has in
effect rules of operation and financial controls, based on a 3-year plan of
operation, adequate to carry out the terms of the plan and to meet all
requirements of this title applicable to the plan.
(3)Rules governing
relationship to participating employers and to contractors
(A)
(i)Except as provided in clauses (ii) and (iii), the members
of the board of trustees are individuals selected from individuals who are the
owners, officers, directors, or employees of the participating employers or who
are partners in the participating employers and actively participate in the
business.
(ii)
(I)Except as provided in subclauses (II) and (III), no such
member is an owner, officer, director, or employee of, or partner in, a
contract administrator or other service provider to the plan.
(II)Limited
exception for providers of services solely on behalf of the
sponsorOfficers or employees of a sponsor which is a service
provider (other than a contract administrator) to the plan may be members of
the board if they constitute not more than 25 percent of the membership of the
board and they do not provide services to the plan other than on behalf of the
sponsor.
(III)Treatment of
providers of medical careIn the case of a sponsor which is an
association whose membership consists primarily of providers of medical care,
subclause (I) shall not apply in the case of any service provider described in
subclause (I) who is a provider of medical care under the plan.
(iii)Clause (i) shall not apply to an association health plan
which is in existence on the date of the enactment of the
Small Business Health Fairness Act of
2009.
(B)The board has sole authority under the plan to approve
applications for participation in the plan and to contract with a service
provider to administer the day-to-day affairs of the plan.
(c)Treatment of
Franchise NetworksIn the case of a group health plan which is
established and maintained by a franchiser for a franchise network consisting
of its franchisees—
(1)the requirements
of subsection (a) and section 801(a) shall be deemed met if such requirements
would otherwise be met if the franchiser were deemed to be the sponsor referred
to in section 801(b), such network were deemed to be an association described
in section 801(b), and each franchisee were deemed to be a member (of the
association and the sponsor) referred to in section 801(b); and
(2)the requirements
of section 804(a)(1) shall be deemed met.
The
Secretary may by regulation define for purposes of this subsection the terms
franchiser, franchise network, and
franchisee.804.Participation
and coverage requirements
(a)Covered
Employers and IndividualsThe requirements of this subsection are
met with respect to an association health plan if, under the terms of the
plan—
(1)each participating
employer must be—
(A)a member of the
sponsor,
(B)the sponsor,
or
(C)an affiliated
member of the sponsor with respect to which the requirements of subsection (b)
are met,
except
that, in the case of a sponsor which is a professional association or other
individual-based association, if at least one of the officers, directors, or
employees of an employer, or at least one of the individuals who are partners
in an employer and who actively participates in the business, is a member or
such an affiliated member of the sponsor, participating employers may also
include such employer; and(2)all individuals
commencing coverage under the plan after certification under this part must
be—
(A)active or retired
owners (including self-employed individuals), officers, directors, or employees
of, or partners in, participating employers; or
(B)the beneficiaries
of individuals described in subparagraph (A).
(b)Coverage of
Previously Uninsured EmployeesIn the case of an association
health plan in existence on the date of the enactment of the
Small Business Health Fairness Act of
2009, an affiliated member of the sponsor of the plan may be
offered coverage under the plan as a participating employer only if—
(1)the affiliated
member was an affiliated member on the date of certification under this part;
or
(2)during the
12-month period preceding the date of the offering of such coverage, the
affiliated member has not maintained or contributed to a group health plan with
respect to any of its employees who would otherwise be eligible to participate
in such association health plan.
(c)Individual
Market UnaffectedThe requirements of this subsection are met
with respect to an association health plan if, under the terms of the plan, no
participating employer may provide health insurance coverage in the individual
market for any employee not covered under the plan which is similar to the
coverage contemporaneously provided to employees of the employer under the
plan, if such exclusion of the employee from coverage under the plan is based
on a health status-related factor with respect to the employee and such
employee would, but for such exclusion on such basis, be eligible for coverage
under the plan.
(d)Prohibition of
Discrimination Against Employers and Employees Eligible To
ParticipateThe requirements of this subsection are met with
respect to an association health plan if—
(1)under the terms of
the plan, all employers meeting the preceding requirements of this section are
eligible to qualify as participating employers for all geographically available
coverage options, unless, in the case of any such employer, participation or
contribution requirements of the type referred to in section 2711 of the
Public Health Service Act are not
met;
(2)upon request, any
employer eligible to participate is furnished information regarding all
coverage options available under the plan; and
(3)the applicable
requirements of sections 701, 702, and 703 are met with respect to the
plan.
805.Other
requirements relating to plan documents, contribution rates, and benefit
options
(a)The requirements of this section are met with respect to
an association health plan if the following requirements are met:
(1)Contents of
governing instrumentsThe instruments governing the plan include
a written instrument, meeting the requirements of an instrument required under
section 402(a)(1), which—
(A)provides that the
board of trustees serves as the named fiduciary required for plans under
section 402(a)(1) and serves in the capacity of a plan administrator (referred
to in section 3(16)(A));
(B)provides that the
sponsor of the plan is to serve as plan sponsor (referred to in section
3(16)(B)); and
(C)incorporates the
requirements of section 806.
(2)Contribution
rates must be nondiscriminatory
(A)The contribution
rates for any participating small employer do not vary on the basis of any
health status-related factor in relation to employees of such employer or their
beneficiaries and do not vary on the basis of the type of business or industry
in which such employer is engaged.
(B)Nothing in this
title or any other provision of law shall be construed to preclude an
association health plan, or a health insurance issuer offering health insurance
coverage in connection with an association health plan, from—
(i)setting
contribution rates based on the claims experience of the plan; or
(ii)varying
contribution rates for small employers in a State to the extent that such rates
could vary using the same methodology employed in such State for regulating
premium rates in the small group market with respect to health insurance
coverage offered in connection with bona fide associations (within the meaning
of section 2791(d)(3) of the Public Health
Service Act),
subject
to the requirements of section 702(b) relating to contribution rates.(3)Floor for number
of covered individuals with respect to certain plansIf any
benefit option under the plan does not consist of health insurance coverage,
the plan has as of the beginning of the plan year not fewer than 1,000
participants and beneficiaries.
(4)
(A)If a benefit option which consists of health insurance
coverage is offered under the plan, State-licensed insurance agents shall be
used to distribute to small employers coverage which does not consist of health
insurance coverage in a manner comparable to the manner in which such agents
are used to distribute health insurance coverage.
(B)State-licensed
insurance agentsFor purposes of subparagraph (A), the term
State-licensed insurance agents means one or more agents who are
licensed in a State and are subject to the laws of such State relating to
licensure, qualification, testing, examination, and continuing education of
persons authorized to offer, sell, or solicit health insurance coverage in such
State.
(5)Such other requirements as the applicable authority
determines are necessary to carry out the purposes of this part, which shall be
prescribed by the applicable authority by regulation.
(b)Ability of
Association Health Plans To Design Benefit OptionsSubject to
section 514(d), nothing in this part or any provision of State law (as defined
in section 514(c)(1)) shall be construed to preclude an association health
plan, or a health insurance issuer offering health insurance coverage in
connection with an association health plan, from exercising its sole discretion
in selecting the specific items and services consisting of medical care to be
included as benefits under such plan or coverage, except (subject to section
514) in the case of (1) any law to the extent that it is not preempted under
section 731(a)(1) with respect to matters governed by section 711, 712, or 713,
or (2) any law of the State with which filing and approval of a policy type
offered by the plan was initially obtained to the extent that such law
prohibits an exclusion of a specific disease from such coverage.
806.Maintenance of
reserves and provisions for solvency for plans providing health benefits in
addition to health insurance coverage
(a)The requirements of this section are met with respect to
an association health plan if—
(1)the benefits under
the plan consist solely of health insurance coverage; or
(2)if the plan
provides any additional benefit options which do not consist of health
insurance coverage, the plan—
(A)establishes and
maintains reserves with respect to such additional benefit options, in amounts
recommended by the qualified health actuary, consisting of—
(i)a
reserve sufficient for unearned contributions;
(ii)a
reserve sufficient for benefit liabilities which have been incurred, which have
not been satisfied, and for which risk of loss has not yet been transferred,
and for expected administrative costs with respect to such benefit
liabilities;
(iii)a reserve
sufficient for any other obligations of the plan; and
(iv)a
reserve sufficient for a margin of error and other fluctuations, taking into
account the specific circumstances of the plan; and
(B)establishes and
maintains aggregate and specific excess/stop loss insurance and solvency
indemnification, with respect to such additional benefit options for which risk
of loss has not yet been transferred, as follows:
(i)The plan shall
secure aggregate excess/stop loss insurance for the plan with an attachment
point which is not greater than 125 percent of expected gross annual claims.
The applicable authority may by regulation provide for upward adjustments in
the amount of such percentage in specified circumstances in which the plan
specifically provides for and maintains reserves in excess of the amounts
required under subparagraph (A).
(ii)The plan shall
secure specific excess/stop loss insurance for the plan with an attachment
point which is at least equal to an amount recommended by the plan’s qualified
health actuary. The applicable authority may by regulation provide for
adjustments in the amount of such insurance in specified circumstances in which
the plan specifically provides for and maintains reserves in excess of the
amounts required under subparagraph (A).
(iii)The plan shall
secure indemnification insurance for any claims which the plan is unable to
satisfy by reason of a plan termination.
Any
person issuing to a plan insurance described in clause (i), (ii), or (iii) of
subparagraph (B) shall notify the Secretary of any failure of premium payment
meriting cancellation of the policy prior to undertaking such a cancellation.
Any regulations prescribed by the applicable authority pursuant to clause (i)
or (ii) of subparagraph (B) may allow for such adjustments in the required
levels of excess/stop loss insurance as the qualified health actuary may
recommend, taking into account the specific circumstances of the plan.(b)Minimum Surplus
in Addition to Claims ReservesIn the case of any association
health plan described in subsection (a)(2), the requirements of this subsection
are met if the plan establishes and maintains surplus in an amount at least
equal to—
(1)$500,000,
or
(2)such greater
amount (but not greater than $2,000,000) as may be set forth in regulations
prescribed by the applicable authority, considering the level of aggregate and
specific excess/stop loss insurance provided with respect to such plan and
other factors related to solvency risk, such as the plan’s projected levels of
participation or claims, the nature of the plan’s liabilities, and the types of
assets available to assure that such liabilities are met.
(c)In the case of any association health plan described
in subsection (a)(2), the applicable authority may provide such additional
requirements relating to reserves, excess/stop loss insurance, and
indemnification insurance as the applicable authority considers appropriate.
Such requirements may be provided by regulation with respect to any such plan
or any class of such plans.
(d)Adjustments for
Excess/Stop Loss InsuranceThe applicable authority may provide
for adjustments to the levels of reserves otherwise required under subsections
(a) and (b) with respect to any plan or class of plans to take into account
excess/stop loss insurance provided with respect to such plan or plans.
(e)Alternative
Means of ComplianceThe applicable authority may permit an
association health plan described in subsection (a)(2) to substitute, for all
or part of the requirements of this section (except subsection (a)(2)(B)(iii)),
such security, guarantee, hold-harmless arrangement, or other financial
arrangement as the applicable authority determines to be adequate to enable the
plan to fully meet all its financial obligations on a timely basis and is
otherwise no less protective of the interests of participants and beneficiaries
than the requirements for which it is substituted. The applicable authority may
take into account, for purposes of this subsection, evidence provided by the
plan or sponsor which demonstrates an assumption of liability with respect to
the plan. Such evidence may be in the form of a contract of indemnification,
lien, bonding, insurance, letter of credit, recourse under applicable terms of
the plan in the form of assessments of participating employers, security, or
other financial arrangement.
(f)Measures To
Ensure Continued Payment of Benefits by Certain Plans in Distress
(1)Payments by
certain plans to association health plan fund
(A)In the case of an association health plan described in
subsection (a)(2), the requirements of this subsection are met if the plan
makes payments into the Association Health Plan Fund under this subparagraph
when they are due. Such payments shall consist of annual payments in the amount
of $5,000, and, in addition to such annual payments, such supplemental payments
as the Secretary may determine to be necessary under paragraph (2). Payments
under this paragraph are payable to the Fund at the time determined by the
Secretary. Initial payments are due in advance of certification under this
part. Payments shall continue to accrue until a plan’s assets are distributed
pursuant to a termination procedure.
(B)Penalties for
failure to make paymentsIf any payment is not made by a plan
when it is due, a late payment charge of not more than 100 percent of the
payment which was not timely paid shall be payable by the plan to the
Fund.
(C)Continued duty
of the secretaryThe Secretary shall not cease to carry out the
provisions of paragraph (2) on account of the failure of a plan to pay any
payment when due.
(2)Payments by
secretary to continue excess/stop loss insurance coverage and indemnification
insurance coverage for certain plansIn any case in which the
applicable authority determines that there is, or that there is reason to
believe that there will be: (A) a failure to take necessary corrective actions
under section 809(a) with respect to an association health plan described in
subsection (a)(2); or (B) a termination of such a plan under section 809(b) or
810(b)(8) (and, if the applicable authority is not the Secretary, certifies
such determination to the Secretary), the Secretary shall determine the amounts
necessary to make payments to an insurer (designated by the Secretary) to
maintain in force excess/stop loss insurance coverage or indemnification
insurance coverage for such plan, if the Secretary determines that there is a
reasonable expectation that, without such payments, claims would not be
satisfied by reason of termination of such coverage. The Secretary shall, to
the extent provided in advance in appropriation Acts, pay such amounts so
determined to the insurer designated by the Secretary.
(3)Association
health plan fund
(A)There is established on the books of the Treasury a fund
to be known as the Association Health Plan Fund
. The Fund shall
be available for making payments pursuant to paragraph (2). The Fund shall be
credited with payments received pursuant to paragraph (1)(A), penalties
received pursuant to paragraph (1)(B); and earnings on investments of amounts
of the Fund under subparagraph (B).
(B)Whenever
the Secretary determines that the moneys of the fund are in excess of current
needs, the Secretary may request the investment of such amounts as the
Secretary determines advisable by the Secretary of the Treasury in obligations
issued or guaranteed by the United States.
(g)Excess/Stop Loss
InsuranceFor purposes of this section—
(1)Aggregate
excess/stop loss insuranceThe term aggregate excess/stop
loss insurance means, in connection with an association health plan, a
contract—
(A)under which an
insurer (meeting such minimum standards as the applicable authority may
prescribe by regulation) provides for payment to the plan with respect to
aggregate claims under the plan in excess of an amount or amounts specified in
such contract;
(B)which is
guaranteed renewable; and
(C)which allows for
payment of premiums by any third party on behalf of the insured plan.
(2)Specific
excess/stop loss insuranceThe term specific excess/stop
loss insurance means, in connection with an association health plan, a
contract—
(A)under which an
insurer (meeting such minimum standards as the applicable authority may
prescribe by regulation) provides for payment to the plan with respect to
claims under the plan in connection with a covered individual in excess of an
amount or amounts specified in such contract in connection with such covered
individual;
(B)which is
guaranteed renewable; and
(C)which allows for
payment of premiums by any third party on behalf of the insured plan.
(h)Indemnification
InsuranceFor purposes of this section, the term
indemnification insurance means, in connection with an association
health plan, a contract—
(1)under which an
insurer (meeting such minimum standards as the applicable authority may
prescribe by regulation) provides for payment to the plan with respect to
claims under the plan which the plan is unable to satisfy by reason of a
termination pursuant to section 809(b) (relating to mandatory
termination);
(2)which is
guaranteed renewable and noncancellable for any reason (except as the
applicable authority may prescribe by regulation); and
(3)which allows for
payment of premiums by any third party on behalf of the insured plan.
(i)For
purposes of this section, the term reserves means, in connection
with an association health plan, plan assets which meet the fiduciary standards
under part 4 and such additional requirements regarding liquidity as the
applicable authority may prescribe by regulation.
(j)Solvency
Standards Working Group
(1)Within 90 days after the date of the enactment of the
Small Business Health Fairness Act of
2009, the applicable authority shall establish a Solvency
Standards Working Group. In prescribing the initial regulations under this
section, the applicable authority shall take into account the recommendations
of such Working Group.
(2)The
Working Group shall consist of not more than 15 members appointed by the
applicable authority. The applicable authority shall include among persons
invited to membership on the Working Group at least one of each of the
following:
(A)a representative
of the National Association of Insurance Commissioners;
(B)a representative
of the American Academy of Actuaries;
(C)a representative
of the State governments, or their interests;
(D)a representative
of existing self-insured arrangements, or their interests;
(E)a representative
of associations of the type referred to in section 801(b)(1), or their
interests; and
(F)a representative
of multiemployer plans that are group health plans, or their interests.
807.Requirements
for application and related requirements
(a)Under the procedure prescribed pursuant to section 802(a), an
association health plan shall pay to the applicable authority at the time of
filing an application for certification under this part a filing fee in the
amount of $5,000, which shall be available in the case of the Secretary, to the
extent provided in appropriation Acts, for the sole purpose of administering
the certification procedures applicable with respect to association health
plans.
(b)Information To
Be Included in Application for CertificationAn application for
certification under this part meets the requirements of this section only if it
includes, in a manner and form which shall be prescribed by the applicable
authority by regulation, at least the following information:
(1)The names and addresses of—
(A)the sponsor;
and
(B)the members of the
board of trustees of the plan.
(2)States in which
plan intends to do businessThe States in which participants and
beneficiaries under the plan are to be located and the number of them expected
to be located in each such State.
(3)Evidence provided by the board of trustees that the
bonding requirements of section 412 will be met as of the date of the
application or (if later) commencement of operations.
(4)A copy of the documents governing the plan (including
any bylaws and trust agreements), the summary plan description, and other
material describing the benefits that will be provided to participants and
beneficiaries under the plan.
(5)Agreements with
service providersA copy of any agreements between the plan and
contract administrators and other service providers.
(6)In the case of association health plans providing benefits
options in addition to health insurance coverage, a report setting forth
information with respect to such additional benefit options determined as of a
date within the 120-day period ending with the date of the application,
including the following:
(A)A
statement, certified by the board of trustees of the plan, and a statement of
actuarial opinion, signed by a qualified health actuary, that all applicable
requirements of section 806 are or will be met in accordance with regulations
which the applicable authority shall prescribe.
(B)Adequacy of
contribution ratesA statement of actuarial opinion, signed by a
qualified health actuary, which sets forth a description of the extent to which
contribution rates are adequate to provide for the payment of all obligations
and the maintenance of required reserves under the plan for the 12-month period
beginning with such date within such 120-day period, taking into account the
expected coverage and experience of the plan. If the contribution rates are not
fully adequate, the statement of actuarial opinion shall indicate the extent to
which the rates are inadequate and the changes needed to ensure
adequacy.
(C)Current and
projected value of assets and liabilitiesA statement of
actuarial opinion signed by a qualified health actuary, which sets forth the
current value of the assets and liabilities accumulated under the plan and a
projection of the assets, liabilities, income, and expenses of the plan for the
12-month period referred to in subparagraph (B). The income statement shall
identify separately the plan’s administrative expenses and claims.
(D)Costs of
coverage to be charged and other expensesA statement of the
costs of coverage to be charged, including an itemization of amounts for
administration, reserves, and other expenses associated with the operation of
the plan.
(E)Any other information as may be determined by the
applicable authority, by regulation, as necessary to carry out the purposes of
this part.
(c)Filing Notice of
Certification With StatesA certification granted under this part
to an association health plan shall not be effective unless written notice of
such certification is filed with the applicable State authority of each State
in which at least 25 percent of the participants and beneficiaries under the
plan are located. For purposes of this subsection, an individual shall be
considered to be located in the State in which a known address of such
individual is located or in which such individual is employed.
(d)Notice of
Material ChangesIn the case of any association health plan
certified under this part, descriptions of material changes in any information
which was required to be submitted with the application for the certification
under this part shall be filed in such form and manner as shall be prescribed
by the applicable authority by regulation. The applicable authority may require
by regulation prior notice of material changes with respect to specified
matters which might serve as the basis for suspension or revocation of the
certification.
(e)Reporting
Requirements for Certain Association Health PlansAn association
health plan certified under this part which provides benefit options in
addition to health insurance coverage for such plan year shall meet the
requirements of section 103 by filing an annual report under such section which
shall include information described in subsection (b)(6) with respect to the
plan year and, notwithstanding section 104(a)(1)(A), shall be filed with the
applicable authority not later than 90 days after the close of the plan year
(or on such later date as may be prescribed by the applicable authority). The
applicable authority may require by regulation such interim reports as it
considers appropriate.
(f)Engagement of
Qualified Health ActuaryThe board of trustees of each
association health plan which provides benefits options in addition to health
insurance coverage and which is applying for certification under this part or
is certified under this part shall engage, on behalf of all participants and
beneficiaries, a qualified health actuary who shall be responsible for the
preparation of the materials comprising information necessary to be submitted
by a qualified health actuary under this part. The qualified health actuary
shall utilize such assumptions and techniques as are necessary to enable such
actuary to form an opinion as to whether the contents of the matters reported
under this part—
(1)are in the
aggregate reasonably related to the experience of the plan and to reasonable
expectations; and
(2)represent such
actuary’s best estimate of anticipated experience under the plan.
The
opinion by the qualified health actuary shall be made with respect to, and
shall be made a part of, the annual report.808.Notice
requirements for voluntary terminationExcept as provided in section 809(b), an
association health plan which is or has been certified under this part may
terminate (upon or at any time after cessation of accruals in benefit
liabilities) only if the board of trustees, not less than 60 days before the
proposed termination date—
(1)provides to the
participants and beneficiaries a written notice of intent to terminate stating
that such termination is intended and the proposed termination date;
(2)develops a plan
for winding up the affairs of the plan in connection with such termination in a
manner which will result in timely payment of all benefits for which the plan
is obligated; and
(3)submits such plan
in writing to the applicable authority.
Actions
required under this section shall be taken in such form and manner as may be
prescribed by the applicable authority by regulation.809.Corrective
actions and mandatory termination
(a)Actions To Avoid
Depletion of ReservesAn association health plan which is
certified under this part and which provides benefits other than health
insurance coverage shall continue to meet the requirements of section 806,
irrespective of whether such certification continues in effect. The board of
trustees of such plan shall determine quarterly whether the requirements of
section 806 are met. In any case in which the board determines that there is
reason to believe that there is or will be a failure to meet such requirements,
or the applicable authority makes such a determination and so notifies the
board, the board shall immediately notify the qualified health actuary engaged
by the plan, and such actuary shall, not later than the end of the next
following month, make such recommendations to the board for corrective action
as the actuary determines necessary to ensure compliance with section 806. Not
later than 30 days after receiving from the actuary recommendations for
corrective actions, the board shall notify the applicable authority (in such
form and manner as the applicable authority may prescribe by regulation) of
such recommendations of the actuary for corrective action, together with a
description of the actions (if any) that the board has taken or plans to take
in response to such recommendations. The board shall thereafter report to the
applicable authority, in such form and frequency as the applicable authority
may specify to the board, regarding corrective action taken by the board until
the requirements of section 806 are met.
(b)In any case in which—
(1)the applicable
authority has been notified under subsection (a) (or by an issuer of
excess/stop loss insurance or indemnity insurance pursuant to section 806(a))
of a failure of an association health plan which is or has been certified under
this part and is described in section 806(a)(2) to meet the requirements of
section 806 and has not been notified by the board of trustees of the plan that
corrective action has restored compliance with such requirements; and
(2)the applicable
authority determines that there is a reasonable expectation that the plan will
continue to fail to meet the requirements of section 806,
the board
of trustees of the plan shall, at the direction of the applicable authority,
terminate the plan and, in the course of the termination, take such actions as
the applicable authority may require, including satisfying any claims referred
to in section 806(a)(2)(B)(iii) and recovering for the plan any liability under
subsection (a)(2)(B)(iii) or (e) of section 806, as necessary to ensure that
the affairs of the plan will be, to the maximum extent possible, wound up in a
manner which will result in timely provision of all benefits for which the plan
is obligated.810.Trusteeship by
the Secretary of insolvent association health plans providing health benefits
in addition to health insurance coverage
(a)Appointment of
Secretary as Trustee for Insolvent PlansWhenever the Secretary
determines that an association health plan which is or has been certified under
this part and which is described in section 806(a)(2) will be unable to provide
benefits when due or is otherwise in a financially hazardous condition, as
shall be defined by the Secretary by regulation, the Secretary shall, upon
notice to the plan, apply to the appropriate United States district court for
appointment of the Secretary as trustee to administer the plan for the duration
of the insolvency. The plan may appear as a party and other interested persons
may intervene in the proceedings at the discretion of the court. The court
shall appoint such Secretary trustee if the court determines that the
trusteeship is necessary to protect the interests of the participants and
beneficiaries or providers of medical care or to avoid any unreasonable
deterioration of the financial condition of the plan. The trusteeship of such
Secretary shall continue until the conditions described in the first sentence
of this subsection are remedied or the plan is terminated.
(b)The Secretary, upon appointment as trustee under
subsection (a), shall have the power—
(1)to do any act
authorized by the plan, this title, or other applicable provisions of law to be
done by the plan administrator or any trustee of the plan;
(2)to require the
transfer of all (or any part) of the assets and records of the plan to the
Secretary as trustee;
(3)to invest any
assets of the plan which the Secretary holds in accordance with the provisions
of the plan, regulations prescribed by the Secretary, and applicable provisions
of law;
(4)to require the
sponsor, the plan administrator, any participating employer, and any employee
organization representing plan participants to furnish any information with
respect to the plan which the Secretary as trustee may reasonably need in order
to administer the plan;
(5)to collect for the
plan any amounts due the plan and to recover reasonable expenses of the
trusteeship;
(6)to commence,
prosecute, or defend on behalf of the plan any suit or proceeding involving the
plan;
(7)to issue, publish,
or file such notices, statements, and reports as may be required by the
Secretary by regulation or required by any order of the court;
(8)to terminate the
plan (or provide for its termination in accordance with section 809(b)) and
liquidate the plan assets, to restore the plan to the responsibility of the
sponsor, or to continue the trusteeship;
(9)to provide for the
enrollment of plan participants and beneficiaries under appropriate coverage
options; and
(10)to do such other
acts as may be necessary to comply with this title or any order of the court
and to protect the interests of plan participants and beneficiaries and
providers of medical care.
(c)As soon as practicable after the Secretary’s
appointment as trustee, the Secretary shall give notice of such appointment
to—
(1)the sponsor and
plan administrator;
(2)each
participant;
(3)each participating
employer; and
(4)if applicable,
each employee organization which, for purposes of collective bargaining,
represents plan participants.
(d)Except to the extent inconsistent with the provisions of
this title, or as may be otherwise ordered by the court, the Secretary, upon
appointment as trustee under this section, shall be subject to the same duties
as those of a trustee under section 704 of title 11, United States Code, and
shall have the duties of a fiduciary for purposes of this title.
(e)An application by the Secretary under this subsection
may be filed notwithstanding the pendency in the same or any other court of any
bankruptcy, mortgage foreclosure, or equity receivership proceeding, or any
proceeding to reorganize, conserve, or liquidate such plan or its property, or
any proceeding to enforce a lien against property of the plan.
(f)
(1)Upon the filing of an application for the appointment as
trustee or the issuance of a decree under this section, the court to which the
application is made shall have exclusive jurisdiction of the plan involved and
its property wherever located with the powers, to the extent consistent with
the purposes of this section, of a court of the United States having
jurisdiction over cases under chapter 11 of title 11, United States Code.
Pending an adjudication under this section such court shall stay, and upon
appointment by it of the Secretary as trustee, such court shall continue the
stay of, any pending mortgage foreclosure, equity receivership, or other
proceeding to reorganize, conserve, or liquidate the plan, the sponsor, or
property of such plan or sponsor, and any other suit against any receiver,
conservator, or trustee of the plan, the sponsor, or property of the plan or
sponsor. Pending such adjudication and upon the appointment by it of the
Secretary as trustee, the court may stay any proceeding to enforce a lien
against property of the plan or the sponsor or any other suit against the plan
or the sponsor.
(2)An
action under this section may be brought in the judicial district where the
sponsor or the plan administrator resides or does business or where any asset
of the plan is situated. A district court in which such action is brought may
issue process with respect to such action in any other judicial
district.
(g)In
accordance with regulations which shall be prescribed by the Secretary, the
Secretary shall appoint, retain, and compensate accountants, actuaries, and
other professional service personnel as may be necessary in connection with the
Secretary’s service as trustee under this section.
811.State
assessment authority
(a)Notwithstanding section 514, a State may impose by law a
contribution tax on an association health plan described in section 806(a)(2),
if the plan commenced operations in such State after the date of the enactment
of the Small Business Health Fairness Act of
2009.
(b)For purposes of this section, the term contribution
tax imposed by a State on an association health plan means any tax
imposed by such State if—
(1)such tax is
computed by applying a rate to the amount of premiums or contributions, with
respect to individuals covered under the plan who are residents of such State,
which are received by the plan from participating employers located in such
State or from such individuals;
(2)the rate of such
tax does not exceed the rate of any tax imposed by such State on premiums or
contributions received by insurers or health maintenance organizations for
health insurance coverage offered in such State in connection with a group
health plan;
(3)such tax is
otherwise nondiscriminatory; and
(4)the amount of any
such tax assessed on the plan is reduced by the amount of any tax or assessment
otherwise imposed by the State on premiums, contributions, or both received by
insurers or health maintenance organizations for health insurance coverage,
aggregate excess/stop loss insurance (as defined in section 806(g)(1)),
specific excess/stop loss insurance (as defined in section 806(g)(2)), other
insurance related to the provision of medical care under the plan, or any
combination thereof provided by such insurers or health maintenance
organizations in such State in connection with such plan.
812.Definitions and
rules of construction
(a)For
purposes of this part—
(1)The term group health plan has the meaning
provided in section 733(a)(1) (after applying subsection (b) of this
section).
(2)The term medical care has the meaning provided
in section 733(a)(2).
(3)Health insurance
coverageThe term health insurance coverage has the
meaning provided in section 733(b)(1).
(4)The term health insurance issuer has the
meaning provided in section 733(b)(2).
(5)The term applicable authority means the
Secretary, except that, in connection with any exercise of the Secretary’s
authority regarding which the Secretary is required under section 506(d) to
consult with a State, such term means the Secretary, in consultation with such
State.
(6)Health
status-related factorThe term health status-related
factor has the meaning provided in section 733(d)(2).
(7)
(A)The term individual market means the market
for health insurance coverage offered to individuals other than in connection
with a group health plan.
(B)Treatment of
very small groups
(i)Subject to clause (ii), such term includes coverage
offered in connection with a group health plan that has fewer than 2
participants as current employees or participants described in section
732(d)(3) on the first day of the plan year.
(ii)Clause (i) shall not apply in the case of health
insurance coverage offered in a State if such State regulates the coverage
described in such clause in the same manner and to the same extent as coverage
in the small group market (as defined in section 2791(e)(5) of the
Public Health Service Act) is
regulated by such State.
(8)The term participating employer means, in
connection with an association health plan, any employer, if any individual who
is an employee of such employer, a partner in such employer, or a self-employed
individual who is such employer (or any dependent, as defined under the terms
of the plan, of such individual) is or was covered under such plan in
connection with the status of such individual as such an employee, partner, or
self-employed individual in relation to the plan.
(9)Applicable state
authorityThe term applicable State authority means,
with respect to a health insurance issuer in a State, the State insurance
commissioner or official or officials designated by the State to enforce the
requirements of title XXVII of the Public Health
Service Act for the State involved with respect to such
issuer.
(10)The term qualified health actuary
means an individual who is a member of the American Academy of Actuaries with
expertise in health care.
(11)The term affiliated member means, in
connection with a sponsor—
(A)a person who is
otherwise eligible to be a member of the sponsor but who elects an affiliated
status with the sponsor,
(B)in the case of a
sponsor with members which consist of associations, a person who is a member of
any such association and elects an affiliated status with the sponsor,
or
(C)in the case of an
association health plan in existence on the date of the enactment of the
Small Business Health Fairness Act of
2009, a person eligible to be a member of the sponsor or one of
its member associations.
(12)The term large employer means, in
connection with a group health plan with respect to a plan year, an employer
who employed an average of at least 51 employees on business days during the
preceding calendar year and who employs at least 2 employees on the first day
of the plan year.
(13)The term small employer means, in
connection with a group health plan with respect to a plan year, an employer
who is not a large employer.
(b)
(1)For purposes of determining whether a plan, fund, or
program is an employee welfare benefit plan which is an association health
plan, and for purposes of applying this title in connection with such plan,
fund, or program so determined to be such an employee welfare benefit
plan—
(A)in the case of a
partnership, the term employer (as defined in section 3(5))
includes the partnership in relation to the partners, and the term
employee (as defined in section 3(6)) includes any partner in
relation to the partnership; and
(B)in the case of a
self-employed individual, the term employer (as defined in section
3(5)) and the term employee (as defined in section 3(6)) shall
include such individual.
(2)Plans, funds,
and programs treated as employee welfare benefit plansIn the
case of any plan, fund, or program which was established or is maintained for
the purpose of providing medical care (through the purchase of insurance or
otherwise) for employees (or their dependents) covered thereunder and which
demonstrates to the Secretary that all requirements for certification under
this part would be met with respect to such plan, fund, or program if such
plan, fund, or program were a group health plan, such plan, fund, or program
shall be treated for purposes of this title as an employee welfare benefit plan
on and after the date of such
demonstration.
.
(b)Conforming
Amendments to Preemption Rules
(1)Section 514(b)(6)
of such Act (29 U.S.C. 1144(b)(6)) is amended by adding at the end the
following new subparagraph:
(E)The preceding subparagraphs of this
paragraph do not apply with respect to any State law in the case of an
association health plan which is certified under part
8.
.
(2)Section 514 of
such Act (29 U.S.C. 1144) is amended—
(A)in subsection
(b)(4), by striking Subsection (a)
and inserting
Subsections (a) and (d)
;
(B)in subsection
(b)(5), by striking subsection (a)
in subparagraph (A) and
inserting subsection (a) of this section and subsections (a)(2)(B) and
(b) of section 805
, and by striking subsection (a)
in
subparagraph (B) and inserting subsection (a) of this section or
subsection (a)(2)(B) or (b) of section 805
;
(C)by redesignating
subsection (d) as subsection (e); and
(D)by inserting after
subsection (c) the following new subsection:
(d)(1)Except as provided in
subsection (b)(4), the provisions of this title shall supersede any and all
State laws insofar as they may now or hereafter preclude, or have the effect of
precluding, a health insurance issuer from offering health insurance coverage
in connection with an association health plan which is certified under part
8.
(2)Except as provided in paragraphs (4)
and (5) of subsection (b) of this section—
(A)In any case in which health insurance
coverage of any policy type is offered under an association health plan
certified under part 8 to a participating employer operating in such State, the
provisions of this title shall supersede any and all laws of such State insofar
as they may preclude a health insurance issuer from offering health insurance
coverage of the same policy type to other employers operating in the State
which are eligible for coverage under such association health plan, whether or
not such other employers are participating employers in such plan.
(B)In any case in which health insurance
coverage of any policy type is offered in a State under an association health
plan certified under part 8 and the filing, with the applicable State authority
(as defined in section 812(a)(9)), of the policy form in connection with such
policy type is approved by such State authority, the provisions of this title
shall supersede any and all laws of any other State in which health insurance
coverage of such type is offered, insofar as they may preclude, upon the filing
in the same form and manner of such policy form with the applicable State
authority in such other State, the approval of the filing in such other
State.
(3)Nothing in subsection (b)(6)(E) or
the preceding provisions of this subsection shall be construed, with respect to
health insurance issuers or health insurance coverage, to supersede or impair
the law of any State—
(A)providing solvency standards or
similar standards regarding the adequacy of insurer capital, surplus, reserves,
or contributions, or
(B)relating to prompt payment of
claims.
(4)For additional provisions relating to
association health plans, see subsections (a)(2)(B) and (b) of section
805.
(5)For purposes of this subsection, the
term association health plan has the meaning provided in section
801(a), and the terms health insurance coverage,
participating employer, and health insurance issuer
have the meanings provided such terms in section 812,
respectively.
.
(3)Section
514(b)(6)(A) of such Act (29 U.S.C. 1144(b)(6)(A)) is amended—
(A)in clause (i)(II),
by striking and
at the end;
(B)in clause (ii), by
inserting and which does not provide medical care (within the meaning of
section 733(a)(2)),
after arrangement,
, and by striking
title.
and inserting title, and
; and
(C)by adding at the
end the following new clause:
(iii)subject to subparagraph (E), in the
case of any other employee welfare benefit plan which is a multiple employer
welfare arrangement and which provides medical care (within the meaning of
section 733(a)(2)), any law of any State which regulates insurance may
apply.
.
(4)Section 514(e) of
such Act (as redesignated by paragraph (2)(C)) is amended—
(A)by striking
Nothing
and inserting (1) Except as provided in paragraph
(2), nothing
; and
(B)by adding at the
end the following new paragraph:
(2)Nothing in any other provision of law
enacted on or after the date of the enactment of the
Small Business Health Fairness Act of
2009 shall be construed to alter, amend, modify, invalidate,
impair, or supersede any provision of this title, except by specific
cross-reference to the affected
section.
.
(c)Section 3(16)(B) of such Act (29 U.S.C. 102(16)(B)) is
amended by adding at the end the following new sentence: Such term also
includes a person serving as the sponsor of an association health plan under
part 8.
.
(d)Disclosure of
Solvency Protections Related to Self-Insured and Fully Insured Options Under
Association Health PlansSection 102(b) of such Act (29 U.S.C.
102(b)) is amended by adding at the end the following: An association
health plan shall include in its summary plan description, in connection with
each benefit option, a description of the form of solvency or guarantee fund
protection secured pursuant to this Act or applicable State law, if
any.
.
(e)Section 731(c) of such Act is amended by inserting
or part 8
after this part
.
(f)Report to the
Congress Regarding Certification of Self-Insured Association Health
PlansNot later than January 1, 2012, the Secretary of Labor
shall report to the Committee on Education and the Workforce of the House of
Representatives and the Committee on Health, Education, Labor, and Pensions of
the Senate the effect association health plans have had, if any, on reducing
the number of uninsured individuals.
(g)The table of contents in section 1 of the
Employee Retirement Income Security Act of
1974 is amended by inserting after the item relating to section 734
the following new items:
Part 8—Rules Governing Association Health
Plans
801. Association health plans.
802. Certification of association health
plans.
803. Requirements relating to sponsors and
boards of trustees.
804. Participation and coverage
requirements.
805. Other requirements relating to plan
documents, contribution rates, and benefit options.
806. Maintenance of reserves and
provisions for solvency for plans providing health benefits in addition to
health insurance coverage.
807. Requirements for application and
related requirements.
808. Notice requirements for voluntary
termination.
809. Corrective actions and mandatory
termination.
810. Trusteeship by the Secretary of
insolvent association health plans providing health benefits in addition to
health insurance coverage.
811. State assessment
authority.
812. Definitions and rules of
construction.
.
233.Clarification
of treatment of single employer arrangementsSection 3(40)(B) of the
Employee Retirement Income Security Act of
1974 (29 U.S.C. 1002(40)(B)) is amended—
(1)in clause (i), by
inserting after control group,
the following: except
that, in any case in which the benefit referred to in subparagraph (A) consists
of medical care (as defined in section 812(a)(2)), two or more trades or
businesses, whether or not incorporated, shall be deemed a single employer for
any plan year of such plan, or any fiscal year of such other arrangement, if
such trades or businesses are within the same control group during such year or
at any time during the preceding 1-year period,
;
(2)in clause (iii),
by striking (iii) the determination
and inserting the
following:
(iii)(I)in any case in which the
benefit referred to in subparagraph (A) consists of medical care (as defined in
section 812(a)(2)), the determination of whether a trade or business is under
common control
with another trade or business shall be
determined under regulations of the Secretary applying principles consistent
and coextensive with the principles applied in determining whether employees of
two or more trades or businesses are treated as employed by a single employer
under section 4001(b), except that, for purposes of this paragraph, an interest
of greater than 25 percent may not be required as the minimum interest
necessary for common control, or
(II)in any other case, the
determination
;
(3)by redesignating
clauses (iv) and (v) as clauses (v) and (vi), respectively; and
(4)by inserting after
clause (iii) the following new clause:
(iv)in any case in which the benefit
referred to in subparagraph (A) consists of medical care (as defined in section
812(a)(2)), in determining, after the application of clause (i), whether
benefits are provided to employees of two or more employers, the arrangement
shall be treated as having only one participating employer if, after the
application of clause (i), the number of individuals who are employees and
former employees of any one participating employer and who are covered under
the arrangement is greater than 75 percent of the aggregate number of all
individuals who are employees or former employees of participating employers
and who are covered under the
arrangement,
.
234.Enforcement
provisions relating to association health plans
(a)Criminal
Penalties for Certain Willful MisrepresentationsSection 501 of
the Employee Retirement Income Security Act of
1974 (29 U.S.C. 1131) is amended—
(1)by inserting
(a)
after Sec. 501.
; and
(2)by adding at the
end the following new subsection:
(b)Any person who
willfully falsely represents, to any employee, any employee’s beneficiary, any
employer, the Secretary, or any State, a plan or other arrangement established
or maintained for the purpose of offering or providing any benefit described in
section 3(1) to employees or their beneficiaries as—
(1)being an
association health plan which has been certified under part 8;
(2)having been
established or maintained under or pursuant to one or more collective
bargaining agreements which are reached pursuant to collective bargaining
described in section 8(d) of the National Labor Relations Act (29 U.S.C.
158(d)) or paragraph Fourth of section 2 of the Railway Labor Act (45 U.S.C.
152, paragraph Fourth) or which are reached pursuant to labor-management
negotiations under similar provisions of State public employee relations laws;
or
(3)being a plan or
arrangement described in section 3(40)(A)(i),
shall,
upon conviction, be imprisoned not more than 5 years, be fined under title 18,
United States Code, or
both..
(b)Section 502 of such Act (29 U.S.C. 1132) is amended by
adding at the end the following new subsection:
(n)Association
Health Plan Cease and Desist Orders
(1)Subject to paragraph (2), upon application by the
Secretary showing the operation, promotion, or marketing of an association
health plan (or similar arrangement providing benefits consisting of medical
care (as defined in section 733(a)(2))) that—
(A)is not certified
under part 8, is subject under section 514(b)(6) to the insurance laws of any
State in which the plan or arrangement offers or provides benefits, and is not
licensed, registered, or otherwise approved under the insurance laws of such
State; or
(B)is an association
health plan certified under part 8 and is not operating in accordance with the
requirements under part 8 for such certification,
a district
court of the United States shall enter an order requiring that the plan or
arrangement cease activities.(2)Paragraph
(1) shall not apply in the case of an association health plan or other
arrangement if the plan or arrangement shows that—
(A)all benefits under
it referred to in paragraph (1) consist of health insurance coverage;
and
(B)with respect to
each State in which the plan or arrangement offers or provides benefits, the
plan or arrangement is operating in accordance with applicable State laws that
are not superseded under section 514.
(3)Additional
equitable reliefThe court may grant such additional equitable
relief, including any relief available under this title, as it deems necessary
to protect the interests of the public and of persons having claims for
benefits against the
plan.
.
(c)Responsibility
for Claims ProcedureSection 503 of such Act (29 U.S.C. 1133) is
amended by inserting (a) In general.—
before In
accordance
, and by adding at the end the following new
subsection:
(b)The terms of each association health plan which is
or has been certified under part 8 shall require the board of trustees or the
named fiduciary (as applicable) to ensure that the requirements of this section
are met in connection with claims filed under the
plan.
.
235.Cooperation
between Federal and State authoritiesSection 506 of the
Employee Retirement Income Security Act of
1974 (29 U.S.C. 1136) is amended by adding at the end the following
new subsection:
(d)Consultation
With States With Respect to Association Health Plans
(1)The Secretary shall consult with the State recognized
under paragraph (2) with respect to an association health plan regarding the
exercise of—
(A)the Secretary’s
authority under sections 502 and 504 to enforce the requirements for
certification under part 8; and
(B)the Secretary’s
authority to certify association health plans under part 8 in accordance with
regulations of the Secretary applicable to certification under part 8.
(2)Recognition of
primary domicile stateIn carrying out paragraph (1), the
Secretary shall ensure that only one State will be recognized, with respect to
any particular association health plan, as the State with which consultation is
required. In carrying out this paragraph—
(A)in the case of a
plan which provides health insurance coverage (as defined in section
812(a)(3)), such State shall be the State with which filing and approval of a
policy type offered by the plan was initially obtained, and
(B)in any other case,
the Secretary shall take into account the places of residence of the
participants and beneficiaries under the plan and the State in which the trust
is
maintained.
.
236.Effective date
and transitional and other rules
(a)The amendments made by this subtitle shall take effect 1
year after the date of the enactment of this Act. The Secretary of Labor shall
first issue all regulations necessary to carry out the amendments made by this
subtitle within 1 year after the date of the enactment of this Act.
(b)Treatment of
Certain Existing Health Benefits Programs
(1)In any case in which, as of the date of the enactment of
this Act, an arrangement is maintained in a State for the purpose of providing
benefits consisting of medical care for the employees and beneficiaries of its
participating employers, at least 200 participating employers make
contributions to such arrangement, such arrangement has been in existence for
at least 10 years, and such arrangement is licensed under the laws of one or
more States to provide such benefits to its participating employers, upon the
filing with the applicable authority (as defined in section 812(a)(5) of the
Employee Retirement Income Security Act of
1974 (as amended by this subtitle)) by the arrangement of an
application for certification of the arrangement under part 8 of subtitle B of
title I of such Act—
(A)such arrangement
shall be deemed to be a group health plan for purposes of title I of such
Act;
(B)the requirements
of sections 801(a) and 803(a) of the Employee
Retirement Income Security Act of 1974 shall be deemed met with
respect to such arrangement;
(C)the requirements
of section 803(b) of such Act shall be deemed met, if the arrangement is
operated by a board of directors which—
(i)is
elected by the participating employers, with each employer having one vote;
and
(ii)has
complete fiscal control over the arrangement and which is responsible for all
operations of the arrangement;
(D)the requirements
of section 804(a) of such Act shall be deemed met with respect to such
arrangement; and
(E)the arrangement
may be certified by any applicable authority with respect to its operations in
any State only if it operates in such State on the date of
certification.
The
provisions of this subsection shall cease to apply with respect to any such
arrangement at such time after the date of the enactment of this Act as the
applicable requirements of this subsection are not met with respect to such
arrangement.(2)For
purposes of this subsection, the terms group health plan,
medical care, and participating employer shall have
the meanings provided in section 812 of the Employee Retirement Income Security Act of
1974, except that the reference in paragraph (7) of such section to
an association health plan
shall be deemed a reference to an
arrangement referred to in this subsection.
<enum>III</enum><header>Interstate
Market for Health Insurance</header>
<section id="H41744A5F63B14CEE980A01EA34C8D010"><enum>301.</enum><header>Cooperative
governing of individual health insurance coverage</header>
<subsection id="H5B05E32DE0074896BFBFBB7EBABE0FC7"><enum>(a)</enum><header>In
General</header><text>Title XXVII of the <act-name parsable-cite="PHSA">Public
Health Service Act</act-name> (42 U.S.C. 300gg et seq.) is amended by adding at
the end the following new part:</text>
<quoted-block act-name="Public" id="HE8F86F7097C04721B8B2D45B4BE3D2E4" style="OLC">
<part id="HC3D5C9A4E4DA4D71B534C219A1386531"><enum>D</enum><header>Cooperative
Governing of Individual Health Insurance Coverage</header>
<section id="HAF83C0227E2749DF9E0A1B1682305FAD"><enum>2795.</enum><header>Definitions</header><text display-inline="no-display-inline">In this part:</text>
<paragraph id="H467F2D1B36E44CA39AD149BEB60E671A"><enum>(1)</enum><header>Primary
state</header><text>The term <term>primary State</term> means, with respect to
individual health insurance coverage offered by a health insurance issuer, the
State designated by the issuer as the State whose covered laws shall govern the
health insurance issuer in the sale of such coverage under this part. An
issuer, with respect to a particular policy, may only designate one such State
as its primary State with respect to all such coverage it offers. Such an
issuer may not change the designated primary State with respect to individual
health insurance coverage once the policy is issued, except that such a change
may be made upon renewal of the policy. With respect to such designated State,
the issuer is deemed to be doing business in that State.</text>
</paragraph><paragraph id="H406CA454025346B6B8A285783041EA3C"><enum>(2)</enum><header>Secondary
state</header><text>The term <term>secondary State</term> means, with respect
to individual health insurance coverage offered by a health insurance issuer,
any State that is not the primary State. In the case of a health insurance
issuer that is selling a policy in, or to a resident of, a secondary State, the
issuer is deemed to be doing business in that secondary State.</text>
</paragraph><paragraph id="HE68ED049CF354152B0700672947503B3"><enum>(3)</enum><header>Health insurance
issuer</header><text>The term <term>health insurance issuer</term> has the
meaning given such term in section 2791(b)(2), except that such an issuer must
be licensed in the primary State and be qualified to sell individual health
insurance coverage in that State.</text>
</paragraph><paragraph id="HBE2D58496DA445E28BECA92FADCB26CF"><enum>(4)</enum><header>Individual
health insurance coverage</header><text>The term <term>individual health
insurance coverage</term> means health insurance coverage offered in the
individual market, as defined in section 2791(e)(1).</text>
</paragraph><paragraph id="H846381E7A506437FBA4779AEED5B01AE"><enum>(5)</enum><header>Applicable state
authority</header><text>The term <term>applicable State authority</term> means,
with respect to a health insurance issuer in a State, the State insurance
commissioner or official or officials designated by the State to enforce the
requirements of this title for the State with respect to the issuer.</text>
</paragraph><paragraph id="HE52D1EF8E5924E6B9E0D440BDA88D79E"><enum>(6)</enum><header>Hazardous
financial condition</header><text>The term <term>hazardous financial
condition</term> means that, based on its present or reasonably anticipated
financial condition, a health insurance issuer is unlikely to be able—</text>
<subparagraph id="H39D34DED0DCF4AECABAC627C973D4A82"><enum>(A)</enum><text>to meet
obligations to policyholders with respect to known claims and reasonably
anticipated claims; or</text>
</subparagraph><subparagraph id="HB195C16A8737413394C1D7589DDD8FC2"><enum>(B)</enum><text>to pay other
obligations in the normal course of business.</text>
</subparagraph></paragraph><paragraph id="HDCE27912AB5A4DAA833B84F01ECB61A3"><enum>(7)</enum><header>Covered
laws</header>
<subparagraph id="HDFA57FCBB83040899516B07BA584B8E7"><enum>(A)</enum><header>In
general</header><text>The term <term>covered laws</term> means the laws, rules,
regulations, agreements, and orders governing the insurance business pertaining
to—</text>
<clause id="HE31A3DBB419C4CA7A0C4785BE3E896F2"><enum>(i)</enum><text>individual health
insurance coverage issued by a health insurance issuer;</text>
</clause><clause id="HB5B391829BC4407E97D7D16B13AEF7F7"><enum>(ii)</enum><text>the offer, sale,
rating (including medical underwriting), renewal, and issuance of individual
health insurance coverage to an individual;</text>
</clause><clause id="H6C02D5177F074709BFF6763BAF0109C6"><enum>(iii)</enum><text>the provision to
an individual in relation to individual health insurance coverage of health
care and insurance related services;</text>
</clause><clause id="H0135341FC6C046B9ACA2450D754859F9"><enum>(iv)</enum><text>the provision to
an individual in relation to individual health insurance coverage of
management, operations, and investment activities of a health insurance issuer;
and</text>
</clause><clause id="H1ADA920E88304BACBF44F894FCBE9B73"><enum>(v)</enum><text>the provision to
an individual in relation to individual health insurance coverage of loss
control and claims administration for a health insurance issuer with respect to
liability for which the issuer provides insurance.</text>
</clause></subparagraph><subparagraph id="H4A59FF26FC5E4C09B842ABD6E83A6263"><enum>(B)</enum><header>Exception</header><text>Such
term does not include any law, rule, regulation, agreement, or order governing
the use of care or cost management techniques, including any requirement
related to provider contracting, network access or adequacy, health care data
collection, or quality assurance.</text>
</subparagraph></paragraph><paragraph id="H21F9DEBA9EFC486E8CBCA2B17DA11A8F"><enum>(8)</enum><header>State</header><text>The
term <term>State</term> means only the 50 States and the District of
Columbia.</text>
</paragraph><paragraph id="HC55D7CE5057B45269CE255F9BE935AF7"><enum>(9)</enum><header>Unfair claims
settlement practices</header><text>The term <term>unfair claims settlement
practices</term> means only the following practices:</text>
<subparagraph id="H2701A563EE51467DA43F96A419197A9F"><enum>(A)</enum><text>Knowingly
misrepresenting to claimants and insured individuals relevant facts or policy
provisions relating to coverage at issue.</text>
</subparagraph><subparagraph id="H7945AF6B5556448C8501E373E46EFFB3"><enum>(B)</enum><text>Failing to
acknowledge with reasonable promptness pertinent communications with respect to
claims arising under policies.</text>
</subparagraph><subparagraph id="HDD1EC9E69E304BB6BBB170D3B37C0D4C"><enum>(C)</enum><text>Failing to adopt
and implement reasonable standards for the prompt investigation and settlement
of claims arising under policies.</text>
</subparagraph><subparagraph id="H44D693059E2A48C2A090CA32027132C7"><enum>(D)</enum><text>Failing to
effectuate prompt, fair, and equitable settlement of claims submitted in which
liability has become reasonably clear.</text>
</subparagraph><subparagraph id="H23C55AB063D642BBB10C80D8FDC90661"><enum>(E)</enum><text>Refusing to pay
claims without conducting a reasonable investigation.</text>
</subparagraph><subparagraph id="H839CFCB0C5194073B9598EE62496124D"><enum>(F)</enum><text>Failing to affirm
or deny coverage of claims within a reasonable period of time after having
completed an investigation related to those claims.</text>
</subparagraph><subparagraph id="H81E869AF80D842959C6C8B592AC5F1EF"><enum>(G)</enum><text>A pattern or
practice of compelling insured individuals or their beneficiaries to institute
suits to recover amounts due under its policies by offering substantially less
than the amounts ultimately recovered in suits brought by them.</text>
</subparagraph><subparagraph id="HC2991E254C0A42CE877C80CC7C13BE95"><enum>(H)</enum><text>A pattern or
practice of attempting to settle or settling claims for less than the amount
that a reasonable person would believe the insured individual or his or her
beneficiary was entitled by reference to written or printed advertising
material accompanying or made part of an application.</text>
</subparagraph><subparagraph id="H05D5666C9E504BFA9AE96B990122352E"><enum>(I)</enum><text>Attempting to
settle or settling claims on the basis of an application that was materially
altered without notice to, or knowledge or consent of, the insured.</text>
</subparagraph><subparagraph id="HE0B9AAD8780B4881BACF8DE43335B2F8"><enum>(J)</enum><text>Failing to provide
forms necessary to present claims within 15 calendar days of a requests with
reasonable explanations regarding their use.</text>
</subparagraph><subparagraph id="H9E4AD82FCCF74E828DC57E1038089C3B"><enum>(K)</enum><text>Attempting to
cancel a policy in less time than that prescribed in the policy or by the law
of the primary State.</text>
</subparagraph></paragraph><paragraph id="HB73210070A5E4351A0BC5981106A3AE7"><enum>(10)</enum><header>Fraud and
abuse</header><text>The term <term>fraud and abuse</term> means an act or
omission committed by a person who, knowingly and with intent to defraud,
commits, or conceals any material information concerning, one or more of the
following:</text>
<subparagraph id="HEE834ADE5F034165B4ECEA423DB549F4"><enum>(A)</enum><text>Presenting,
causing to be presented or preparing with knowledge or belief that it will be
presented to or by an insurer, a reinsurer, broker or its agent, false
information as part of, in support of or concerning a fact material to one or
more of the following:</text>
<clause id="H26A0CF7C74FD43D5B08AA594FFE56FDD"><enum>(i)</enum><text>An
application for the issuance or renewal of an insurance policy or reinsurance
contract.</text>
</clause><clause id="H27D7926F4E7847C59E57904370953A9D"><enum>(ii)</enum><text>The rating of an
insurance policy or reinsurance contract.</text>
</clause><clause id="HB6425386EC5B4D91B6642FFA3A68D2E6"><enum>(iii)</enum><text>A claim for
payment or benefit pursuant to an insurance policy or reinsurance
contract.</text>
</clause><clause id="H258C59B2F847435EB832C0D007A7F8FE"><enum>(iv)</enum><text>Premiums paid on
an insurance policy or reinsurance contract.</text>
</clause><clause id="HFA85C7C83BF64E64844D7BD4F7A9D547"><enum>(v)</enum><text>Payments made in
accordance with the terms of an insurance policy or reinsurance
contract.</text>
</clause><clause id="H043E4FD5FF744349A05150E940E99A80"><enum>(vi)</enum><text>A
document filed with the commissioner or the chief insurance regulatory official
of another jurisdiction.</text>
</clause><clause id="H062D59E7E5A1490CA782B87BFCA71F04"><enum>(vii)</enum><text>The financial
condition of an insurer or reinsurer.</text>
</clause><clause id="H054881D9420446B68B8BDDAC172F130E"><enum>(viii)</enum><text>The formation,
acquisition, merger, reconsolidation, dissolution or withdrawal from one or
more lines of insurance or reinsurance in all or part of a State by an insurer
or reinsurer.</text>
</clause><clause id="H62313E2B9D344D21A9D36896CD654E70"><enum>(ix)</enum><text>The issuance of
written evidence of insurance.</text>
</clause><clause id="H3593492D02DB4CFBB34DDCA91D477ABE"><enum>(x)</enum><text>The reinstatement
of an insurance policy.</text>
</clause></subparagraph><subparagraph id="H2482D478922844F488A43E850A619A07"><enum>(B)</enum><text>Solicitation or
acceptance of new or renewal insurance risks on behalf of an insurer reinsurer
or other person engaged in the business of insurance by a person who knows or
should know that the insurer or other person responsible for the risk is
insolvent at the time of the transaction.</text>
</subparagraph><subparagraph id="H3777AC176888496A89891B6E9A52172F"><enum>(C)</enum><text>Transaction of the
business of insurance in violation of laws requiring a license, certificate of
authority or other legal authority for the transaction of the business of
insurance.</text>
</subparagraph><subparagraph id="H81ECF6D643E841819AAD9BE6EF67A0A9"><enum>(D)</enum><text>Attempt to commit,
aiding or abetting in the commission of, or conspiracy to commit the acts or
omissions specified in this paragraph.</text>
</subparagraph></paragraph></section><section id="H83632D18A5B74170B19239B68D0F0C02"><enum>2796.</enum><header>Application of
law</header>
<subsection id="HA1AA47C7A8464DCFB0BA78960533CC17"><enum>(a)</enum><header>In
General</header><text>The covered laws of the primary State shall apply to
individual health insurance coverage offered by a health insurance issuer in
the primary State and in any secondary State, but only if the coverage and
issuer comply with the conditions of this section with respect to the offering
of coverage in any secondary State.</text>
</subsection><subsection id="HF9A091D10AEB44CEA964052B9BBE7D60"><enum>(b)</enum><header>Exemptions From
Covered Laws in a Secondary State</header><text>Except as provided in this
section, a health insurance issuer with respect to its offer, sale, rating
(including medical underwriting), renewal, and issuance of individual health
insurance coverage in any secondary State is exempt from any covered laws of
the secondary State (and any rules, regulations, agreements, or orders sought
or issued by such State under or related to such covered laws) to the extent
that such laws would—</text>
<paragraph id="H7EF449AE144745AFB811E00AD7DA2688"><enum>(1)</enum><text>make unlawful, or
regulate, directly or indirectly, the operation of the health insurance issuer
operating in the secondary State, except that any secondary State may require
such an issuer—</text>
<subparagraph id="HDFDE46E19A7A407CBAC57900BF832A1E"><enum>(A)</enum><text>to pay, on a
nondiscriminatory basis, applicable premium and other taxes (including high
risk pool assessments) which are levied on insurers and surplus lines insurers,
brokers, or policyholders under the laws of the State;</text>
</subparagraph><subparagraph id="H27D6924F0B4842DCBF445AE7D69D4E6E"><enum>(B)</enum><text>to register with
and designate the State insurance commissioner as its agent solely for the
purpose of receiving service of legal documents or process;</text>
</subparagraph><subparagraph id="H177B5F8CC08746289D8EA515304522CD"><enum>(C)</enum><text>to submit to an
examination of its financial condition by the State insurance commissioner in
any State in which the issuer is doing business to determine the issuer’s
financial condition, if—</text>
<clause id="HE785473590914B8495777F83257D31FA"><enum>(i)</enum><text>the State
insurance commissioner of the primary State has not done an examination within
the period recommended by the National Association of Insurance Commissioners;
and</text>
</clause><clause id="H5C869EA794024E589D8F2407423019BD"><enum>(ii)</enum><text>any such
examination is conducted in accordance with the examiners’ handbook of the
National Association of Insurance Commissioners and is coordinated to avoid
unjustified duplication and unjustified repetition;</text>
</clause></subparagraph><subparagraph id="HF58EA4A7402E4AE5B0FCA09DA024AF73"><enum>(D)</enum><text>to comply with a
lawful order issued—</text>
<clause id="HD2CD24496D354189BEEBA5F81DFBFF33"><enum>(i)</enum><text>in
a delinquency proceeding commenced by the State insurance commissioner if there
has been a finding of financial impairment under subparagraph (C); or</text>
</clause><clause id="H3AE7B037F6514A77826B8CE1F735D0B0"><enum>(ii)</enum><text>in a voluntary
dissolution proceeding;</text>
</clause></subparagraph><subparagraph id="HB67948995B8D492BA82DF060C7C08984"><enum>(E)</enum><text>to comply with an
injunction issued by a court of competent jurisdiction, upon a petition by the
State insurance commissioner alleging that the issuer is in hazardous financial
condition;</text>
</subparagraph><subparagraph id="H8FF49D68FD9A4DA5BB8C901490F99D09"><enum>(F)</enum><text>to participate, on
a nondiscriminatory basis, in any insurance insolvency guaranty association or
similar association to which a health insurance issuer in the State is required
to belong;</text>
</subparagraph><subparagraph id="HD327BE199C834AEF84C09DA0FC099B07"><enum>(G)</enum><text>to comply with any
State law regarding fraud and abuse (as defined in section 2795(10)), except
that if the State seeks an injunction regarding the conduct described in this
subparagraph, such injunction must be obtained from a court of competent
jurisdiction;</text>
</subparagraph><subparagraph id="H4E0C44B78C7F42ADB43820F47470A170"><enum>(H)</enum><text>to comply with any
State law regarding unfair claims settlement practices (as defined in section
2795(9)); or</text>
</subparagraph><subparagraph id="H95E065C6B72548C2AEA7D8B6915D5EBF"><enum>(I)</enum><text>to comply with the
applicable requirements for independent review under section 2798 with respect
to coverage offered in the State;</text>
</subparagraph></paragraph><paragraph id="HEE5F92B4B6B64DE98ED972D9732A99F2"><enum>(2)</enum><text>require any
individual health insurance coverage issued by the issuer to be countersigned
by an insurance agent or broker residing in that Secondary State; or</text>
</paragraph><paragraph id="H7574C8BC8DB3434CB72F3BAE27A0E6B4"><enum>(3)</enum><text>otherwise
discriminate against the issuer issuing insurance in both the primary State and
in any secondary State.</text>
</paragraph></subsection><subsection id="H84919F742E8448E185EC44FC47906D9C"><enum>(c)</enum><header>Clear and
Conspicuous Disclosure</header><text>A health insurance issuer shall provide
the following notice, in 12-point bold type, in any insurance coverage offered
in a secondary State under this part by such a health insurance issuer and at
renewal of the policy, with the 5 blank spaces therein being appropriately
filled with the name of the health insurance issuer, the name of primary State,
the name of the secondary State, the name of the secondary State, and the name
of the secondary State, respectively, for the coverage concerned:</text>
<continuation-text continuation-text-level="subsection">This
policy is issued by _____ and is governed by the laws and regulations of the
State of _____, and it has met all the laws of that State as determined by that
State’s Department of Insurance. This policy may be less expensive than others
because it is not subject to all of the insurance laws and regulations of the
State of _____, including coverage of some services or benefits mandated by the
law of the State of _____. Additionally, this policy is not subject to all of
the consumer protection laws or restrictions on rate changes of the State of
_____. As with all insurance products, before purchasing this policy, you
should carefully review the policy and determine what health care services the
policy covers and what benefits it provides, including any exclusions,
limitations, or conditions for such services or benefits.</continuation-text></subsection><subsection id="HB23066FCE28F4EFBAB0266EAAB77306A"><enum>(d)</enum><header>Prohibition on
Certain Reclassifications and Premium Increases</header>
<paragraph id="H76BA85DC07FF4A3DBA6757FC97ACE854"><enum>(1)</enum><header>In
general</header><text>For purposes of this section, a health insurance issuer
that provides individual health insurance coverage to an individual under this
part in a primary or secondary State may not upon renewal—</text>
<subparagraph id="H64726097E9E04A98B16AE7DE9294F61E"><enum>(A)</enum><text>move or reclassify
the individual insured under the health insurance coverage from the class such
individual is in at the time of issue of the contract based on the
health-status related factors of the individual; or</text>
</subparagraph><subparagraph id="H9A8136E5DD83499BBBC0C6F76196F19E"><enum>(B)</enum><text>increase the
premiums assessed the individual for such coverage based on a health
status-related factor or change of a health status-related factor or the past
or prospective claim experience of the insured individual.</text>
</subparagraph></paragraph><paragraph id="H7D8CA16CB8E74B1381E4DBC2FE105009"><enum>(2)</enum><header>Construction</header><text>Nothing
in paragraph (1) shall be construed to prohibit a health insurance
issuer—</text>
<subparagraph id="HCFA9BC3298DF4B0C808F9DC4C702330B"><enum>(A)</enum><text>from terminating
or discontinuing coverage or a class of coverage in accordance with subsections
(b) and (c) of section 2742;</text>
</subparagraph><subparagraph id="H6183FAA61F5A4A6D9E00BE63E26919D5"><enum>(B)</enum><text>from raising
premium rates for all policy holders within a class based on claims
experience;</text>
</subparagraph><subparagraph id="H7FF60D0868084977ADEF1A189BE6E7F1"><enum>(C)</enum><text>from changing
premiums or offering discounted premiums to individuals who engage in wellness
activities at intervals prescribed by the issuer, if such premium changes or
incentives—</text>
<clause id="H064081F5E35241119E2BFDBD1E4854D1"><enum>(i)</enum><text>are disclosed to
the consumer in the insurance contract;</text>
</clause><clause id="H1C18B4D13E844D6597791A2310BECBF5"><enum>(ii)</enum><text>are based on
specific wellness activities that are not applicable to all individuals;
and</text>
</clause><clause id="HF37361A08C264255BEA968C035C53A6F"><enum>(iii)</enum><text>are not
obtainable by all individuals to whom coverage is offered;</text>
</clause></subparagraph><subparagraph id="HA830FB2A96F642F5A7A648320A7941AB"><enum>(D)</enum><text>from reinstating
lapsed coverage; or</text>
</subparagraph><subparagraph id="H6C2CA16DC0F3497AAEC2E43385035CD3"><enum>(E)</enum><text>from retroactively
adjusting the rates charged an insured individual if the initial rates were set
based on material misrepresentation by the individual at the time of
issue.</text>
</subparagraph></paragraph></subsection><subsection id="H1BF0B07A9EFB405CA8071C65848CFC62"><enum>(e)</enum><header>Prior Offering
of Policy in Primary State</header><text>A health insurance issuer may not
offer for sale individual health insurance coverage in a secondary State unless
that coverage is currently offered for sale in the primary State.</text>
</subsection><subsection id="HCA9759CBBCB145958CD104376F05E7C5"><enum>(f)</enum><header>Licensing of
Agents or Brokers for Health Insurance Issuers</header><text>Any State may
require that a person acting, or offering to act, as an agent or broker for a
health insurance issuer with respect to the offering of individual health
insurance coverage obtain a license from that State, with commissions or other
compensation subject to the provisions of the laws of that State, except that a
State may not impose any qualification or requirement which discriminates
against a nonresident agent or broker.</text>
</subsection><subsection id="H8030FA1C28AC42AEBD9686959DAE8A2F"><enum>(g)</enum><header>Documents for
Submission to State Insurance Commissioner</header><text>Each health insurance
issuer issuing individual health insurance coverage in both primary and
secondary States shall submit—</text>
<paragraph id="H288D862F048547D6AB17CEFCFC4A3D8D"><enum>(1)</enum><text>to the insurance
commissioner of each State in which it intends to offer such coverage, before
it may offer individual health insurance coverage in such State—</text>
<subparagraph id="H640EE4FAF3E249AA8B4A044E4076320A"><enum>(A)</enum><text>a copy of the plan
of operation or feasibility study or any similar statement of the policy being
offered and its coverage (which shall include the name of its primary State and
its principal place of business);</text>
</subparagraph><subparagraph id="HCFDB772627864D08BCA44B4817CF7473"><enum>(B)</enum><text>written notice of
any change in its designation of its primary State; and</text>
</subparagraph><subparagraph id="H35A89569D8164AA6AEAAB7172F80189F"><enum>(C)</enum><text>written notice
from the issuer of the issuer’s compliance with all the laws of the primary
State; and</text>
</subparagraph></paragraph><paragraph id="H92259435AB6A4150AC0DEE707A115646"><enum>(2)</enum><text>to the insurance
commissioner of each secondary State in which it offers individual health
insurance coverage, a copy of the issuer’s quarterly financial statement
submitted to the primary State, which statement shall be certified by an
independent public accountant and contain a statement of opinion on loss and
loss adjustment expense reserves made by—</text>
<subparagraph id="H6B60DC092A364CA6B3B8DEB06D624C8C"><enum>(A)</enum><text>a member of the
American Academy of Actuaries; or</text>
</subparagraph><subparagraph id="H52230C5D2A8B47528205DA9391F70E81"><enum>(B)</enum><text>a qualified loss
reserve specialist.</text>
</subparagraph></paragraph></subsection><subsection id="H38DB4ED1170D4D43B0E12FED1C522B23"><enum>(h)</enum><header>Power of Courts
To Enjoin Conduct</header><text>Nothing in this section shall be construed to
affect the authority of any Federal or State court to enjoin—</text>
<paragraph id="HCFD48FAB5ADD494197ADA256FC2900C0"><enum>(1)</enum><text>the solicitation
or sale of individual health insurance coverage by a health insurance issuer to
any person or group who is not eligible for such insurance; or</text>
</paragraph><paragraph id="H99EBBFA2ED454D87AB1316C7B460FE8F"><enum>(2)</enum><text>the solicitation
or sale of individual health insurance coverage that violates the requirements
of the law of a secondary State which are described in subparagraphs (A)
through (H) of section 2796(b)(1).</text>
</paragraph></subsection><subsection id="HC2CD9A3DB70745D89681FEFE4D427516"><enum>(i)</enum><header>Power of
Secondary States To Take Administrative Action</header><text>Nothing in this
section shall be construed to affect the authority of any State to enjoin
conduct in violation of that State’s laws described in section
2796(b)(1).</text>
</subsection><subsection id="H323BAFF0B5C24537AA6ADF60C2C9D384"><enum>(j)</enum><header>State Powers To
Enforce State Laws</header>
<paragraph id="H7972A6D3040445EABFC9376FD33B8866"><enum>(1)</enum><header>In
general</header><text>Subject to the provisions of subsection (b)(1)(G)
(relating to injunctions) and paragraph (2), nothing in this section shall be
construed to affect the authority of any State to make use of any of its powers
to enforce the laws of such State with respect to which a health insurance
issuer is not exempt under subsection (b).</text>
</paragraph><paragraph id="HB13F883B6D974362AD0AD5574FAAA0C8"><enum>(2)</enum><header>Courts of
competent jurisdiction</header><text>If a State seeks an injunction regarding
the conduct described in paragraphs (1) and (2) of subsection (h), such
injunction must be obtained from a Federal or State court of competent
jurisdiction.</text>
</paragraph></subsection><subsection id="HC694187639634C61B7F6F9EF53773B87"><enum>(k)</enum><header>States’
Authority To Sue</header><text>Nothing in this section shall affect the
authority of any State to bring action in any Federal or State court.</text>
</subsection><subsection id="H1CE45BC9888542039CB488CCBCC72E25"><enum>(l)</enum><header>Generally
Applicable Laws</header><text>Nothing in this section shall be construed to
affect the applicability of State laws generally applicable to persons or
corporations.</text>
</subsection><subsection id="H7C5844D55B5B47218A3B9D7203CCFC35"><enum>(m)</enum><header>Guaranteed
Availability of Coverage to HIPAA Eligible Individuals</header><text>To the
extent that a health insurance issuer is offering coverage in a primary State
that does not accommodate residents of secondary States or does not provide a
working mechanism for residents of a secondary State, and the issuer is
offering coverage under this part in such secondary State which has not adopted
a qualified high risk pool as its acceptable alternative mechanism (as defined
in section 2744(c)(2)), the issuer shall, with respect to any individual health
insurance coverage offered in a secondary State under this part, comply with
the guaranteed availability requirements for eligible individuals in section
2741.</text>
</subsection></section><section id="H5E1BAA0081F145F69890D1D9C6BBC929"><enum>2797.</enum><header>Primary State
must meet Federal floor before issuer may sell into secondary
States</header><text display-inline="no-display-inline">A health insurance
issuer may not offer, sell, or issue individual health insurance coverage in a
secondary State if the State insurance commissioner does not use a risk-based
capital formula for the determination of capital and surplus requirements for
all health insurance issuers.</text>
</section><section id="H8EB38C73224E4C37A4FB442502AEB6BF"><enum>2798.</enum><header>Limitation on
individual purchase in secondary State</header><text display-inline="no-display-inline">Effective beginning two years after the date
of enactment of this part, an individual in a State may not buy individual
health insurance coverage in a secondary State if the premium for individual
health insurance in the primary State (with respect to the individual) exceeds
the national average premium by 10 percent or more.</text>
</section><section id="H9830FDEA02014F8494DFF7E0D8228ADF"><enum>2799.</enum><header>Independent
external appeals procedures</header>
<subsection id="H381808D4317D48649F8FCB4B77322422"><enum>(a)</enum><header>Right to
External Appeal</header><text>A health insurance issuer may not offer, sell, or
issue individual health insurance coverage in a secondary State under the
provisions of this title unless—</text>
<paragraph id="H20DA0D31FD9C4B8B9E466D25889DEEEF"><enum>(1)</enum><text>both the secondary
State and the primary State have legislation or regulations in place
establishing an independent review process for individuals who are covered by
individual health insurance coverage, or</text>
</paragraph><paragraph id="HF84E383B561C4FAF94CE66E6FE4E1B44"><enum>(2)</enum><text>in any case in
which the requirements of subparagraph (A) are not met with respect to the
either of such States, the issuer provides an independent review mechanism
substantially identical (as determined by the applicable State authority of
such State) to that prescribed in the <quote>Health Carrier External Review
Model Act</quote> of the National Association of Insurance Commissioners for
all individuals who purchase insurance coverage under the terms of this part,
except that, under such mechanism, the review is conducted by an independent
medical reviewer, or a panel of such reviewers, with respect to whom the
requirements of subsection (b) are met.</text>
</paragraph></subsection><subsection id="HA3DBF31649AA4054AF5F0AA334119592"><enum>(b)</enum><header>Qualifications
of Independent Medical Reviewers</header><text>In the case of any independent
review mechanism referred to in subsection (a)(2)—</text>
<paragraph id="H10C024DE60BA4C3BA0B994A5A6F82868"><enum>(1)</enum><header>In
general</header><text>In referring a denial of a claim to an independent
medical reviewer, or to any panel of such reviewers, to conduct independent
medical review, the issuer shall ensure that—</text>
<subparagraph id="H514241B72D7645EB92AEE780F8747A07"><enum>(A)</enum><text>each independent
medical reviewer meets the qualifications described in paragraphs (2) and
(3);</text>
</subparagraph><subparagraph id="HFCD2EFDFBB7A42F0B278E3D48744FB1B"><enum>(B)</enum><text>with respect to
each review, each reviewer meets the requirements of paragraph (4) and the
reviewer, or at least 1 reviewer on the panel, meets the requirements described
in paragraph (5); and</text>
</subparagraph><subparagraph id="H3BDA94B310474DDA99E81A7A1B5FAE86"><enum>(C)</enum><text>compensation
provided by the issuer to each reviewer is consistent with paragraph
(6).</text>
</subparagraph></paragraph><paragraph id="HB5C1F31BB00747C4A474A378E8E427B2"><enum>(2)</enum><header>Licensure and
expertise</header><text>Each independent medical reviewer shall be a physician
(allopathic or osteopathic) or health care professional who—</text>
<subparagraph id="HBDB3019070154ADBB9E5B9F88AA735B3"><enum>(A)</enum><text>is appropriately
credentialed or licensed in 1 or more States to deliver health care services;
and</text>
</subparagraph><subparagraph id="H2215F459449149C4A71B195146188397"><enum>(B)</enum><text>typically treats
the condition, makes the diagnosis, or provides the type of treatment under
review.</text>
</subparagraph></paragraph><paragraph id="H4A2469D6258A46708B60D2B9963E6409"><enum>(3)</enum><header>Independence</header>
<subparagraph id="H917E44C139364B7098D15BD0A8685967"><enum>(A)</enum><header>In
general</header><text>Subject to subparagraph (B), each independent medical
reviewer in a case shall—</text>
<clause id="H978C9E20E14047138ACCAF653104E1BB"><enum>(i)</enum><text>not be a related
party (as defined in paragraph (7));</text>
</clause><clause id="HA03066A671B841BAB62773E8744B810A"><enum>(ii)</enum><text>not have a
material familial, financial, or professional relationship with such a party;
and</text>
</clause><clause id="HCA0CB8EE3EB944D2A7E3BE1C7AA60B15"><enum>(iii)</enum><text>not otherwise
have a conflict of interest with such a party (as determined under
regulations).</text>
</clause></subparagraph><subparagraph id="H3371BBA40B0A4700B33A83CFF4CAF33F"><enum>(B)</enum><header>Exception</header><text>Nothing
in subparagraph (A) shall be construed to—</text>
<clause id="H54C01FE6177A4979887408A83C35DD5C"><enum>(i)</enum><text>prohibit an
individual, solely on the basis of affiliation with the issuer, from serving as
an independent medical reviewer if—</text>
<subclause id="HAB1549381AE0401D8ABC819D9257888A"><enum>(I)</enum><text>a non-affiliated
individual is not reasonably available;</text>
</subclause><subclause id="H529AF655B7B34584BA408132ED4FE637"><enum>(II)</enum><text>the affiliated
individual is not involved in the provision of items or services in the case
under review;</text>
</subclause><subclause id="H3BA48ED7C5374D03AE12D9BAD6F86C84"><enum>(III)</enum><text>the fact of such
an affiliation is disclosed to the issuer and the enrollee (or authorized
representative) and neither party objects; and</text>
</subclause><subclause id="H4A896699CD194187BEF0E53C9F63B0B1"><enum>(IV)</enum><text>the affiliated
individual is not an employee of the issuer and does not provide services
exclusively or primarily to or on behalf of the issuer;</text>
</subclause></clause><clause id="HD8DBA59110874AD89E74EFBFBA2585CA"><enum>(ii)</enum><text>prohibit an
individual who has staff privileges at the institution where the treatment
involved takes place from serving as an independent medical reviewer merely on
the basis of such affiliation if the affiliation is disclosed to the issuer and
the enrollee (or authorized representative), and neither party objects;
or</text>
</clause><clause id="H600C743C674742AFA95A18B88C22D8D6"><enum>(iii)</enum><text>prohibit receipt
of compensation by an independent medical reviewer from an entity if the
compensation is provided consistent with paragraph (6).</text>
</clause></subparagraph></paragraph><paragraph id="HE6FE71EB69D94FB3854F0CE1961BFB63"><enum>(4)</enum><header>Practicing
health care professional in same field</header>
<subparagraph id="H6570A7CE545B40CBA26F5005875FEC58"><enum>(A)</enum><header>In
general</header><text>In a case involving treatment, or the provision of items
or services—</text>
<clause id="HA56E0A9D33074F22A6DB422EF8E9629F"><enum>(i)</enum><text>by
a physician, a reviewer shall be a practicing physician (allopathic or
osteopathic) of the same or similar specialty, as a physician who, acting
within the appropriate scope of practice within the State in which the service
is provided or rendered, typically treats the condition, makes the diagnosis,
or provides the type of treatment under review; or</text>
</clause><clause id="HDFC17AB63FCC45A7AAB4D64A52EC8875"><enum>(ii)</enum><text>by a
non-physician health care professional, the reviewer, or at least 1 member of
the review panel, shall be a practicing non-physician health care professional
of the same or similar specialty as the non-physician health care professional
who, acting within the appropriate scope of practice within the State in which
the service is provided or rendered, typically treats the condition, makes the
diagnosis, or provides the type of treatment under review.</text>
</clause></subparagraph><subparagraph id="HC2F6D361A85D4353A789639A799D07BD"><enum>(B)</enum><header>Practicing
defined</header><text>For purposes of this paragraph, the term
<term>practicing</term> means, with respect to an individual who is a physician
or other health care professional, that the individual provides health care
services to individual patients on average at least 2 days per week.</text>
</subparagraph></paragraph><paragraph id="H4DC6BA83D74045B09D50FF92170E8792"><enum>(5)</enum><header>Pediatric
expertise</header><text>In the case of an external review relating to a child,
a reviewer shall have expertise under paragraph (2) in pediatrics.</text>
</paragraph><paragraph id="H392A4AC3EB994DE888E55BC33573AB2D"><enum>(6)</enum><header>Limitations on
reviewer compensation</header><text>Compensation provided by the issuer to an
independent medical reviewer in connection with a review under this section
shall—</text>
<subparagraph id="HCE2057BB943B402AA9B39DA769FACB67"><enum>(A)</enum><text>not exceed a
reasonable level; and</text>
</subparagraph><subparagraph id="H6FCE76BDD6F84C2F85006A9573FB61E5"><enum>(B)</enum><text>not be contingent
on the decision rendered by the reviewer.</text>
</subparagraph></paragraph><paragraph id="HEE96480A049641248ACB14E86028F254"><enum>(7)</enum><header>Related party
defined</header><text>For purposes of this section, the term <term>related
party</term> means, with respect to a denial of a claim under a coverage
relating to an enrollee, any of the following:</text>
<subparagraph id="H0ED864EAB2374820AE49E0CF480C9043"><enum>(A)</enum><text>The issuer
involved, or any fiduciary, officer, director, or employee of the
issuer.</text>
</subparagraph><subparagraph id="H38DA9F53401E47BAB20F3D811BD73A00"><enum>(B)</enum><text>The enrollee (or
authorized representative).</text>
</subparagraph><subparagraph id="H62626A7E920840F5942C85686C5826AA"><enum>(C)</enum><text>The health care
professional that provides the items or services involved in the denial.</text>
</subparagraph><subparagraph id="HCB838418B98644DD81793641DABD7169"><enum>(D)</enum><text>The institution at
which the items or services (or treatment) involved in the denial are
provided.</text>
</subparagraph><subparagraph id="H02A89DEDD1D74D0882EB0002CD97881D"><enum>(E)</enum><text>The manufacturer
of any drug or other item that is included in the items or services involved in
the denial.</text>
</subparagraph><subparagraph id="H4192556F043A4A049019E7D9A3C456B2"><enum>(F)</enum><text>Any other party
determined under any regulations to have a substantial interest in the denial
involved.</text>
</subparagraph></paragraph><paragraph id="HE7F4D3C43A924F599E62828DE5A4E74C"><enum>(8)</enum><header>Definitions</header><text>For
purposes of this subsection:</text>
<subparagraph id="H0B6F894A8B1B4DF2B7FAF684F5A5301B"><enum>(A)</enum><header>Enrollee</header><text>The
term <term>enrollee</term> means, with respect to health insurance coverage
offered by a health insurance issuer, an individual enrolled with the issuer to
receive such coverage.</text>
</subparagraph><subparagraph id="HF273FF3622644F5CAECBA1E119AA5F93"><enum>(B)</enum><header>Health care
professional</header><text>The term <term>health care professional</term> means
an individual who is licensed, accredited, or certified under State law to
provide specified health care services and who is operating within the scope of
such licensure, accreditation, or certification.</text>
</subparagraph></paragraph></subsection></section><section id="H2B6419F702BA4BEA8D3DF9D4672EA427"><enum>2800.</enum><header>Enforcement</header>
<subsection id="H6EEB31D714A14772B6F136BC3FE15076"><enum>(a)</enum><header>In
General</header><text>Subject to subsection (b), with respect to specific
individual health insurance coverage the primary State for such coverage has
sole jurisdiction to enforce the primary State’s covered laws in the primary
State and any secondary State.</text>
</subsection><subsection id="H4E64E455DC5F4A798C77DBD1E58BA041"><enum>(b)</enum><header>Secondary
State’s Authority</header><text>Nothing in subsection (a) shall be construed to
affect the authority of a secondary State to enforce its laws as set forth in
the exception specified in section 2796(b)(1).</text>
</subsection><subsection id="H98E04D97452A43849967E9AB63123F8B"><enum>(c)</enum><header>Court
Interpretation</header><text>In reviewing action initiated by the applicable
secondary State authority, the court of competent jurisdiction shall apply the
covered laws of the primary State.</text>
</subsection><subsection id="H6D08248C468D4C55BF989301A398BE11"><enum>(d)</enum><header>Notice of
Compliance Failure</header><text>In the case of individual health insurance
coverage offered in a secondary State that fails to comply with the covered
laws of the primary State, the applicable State authority of the secondary
State may notify the applicable State authority of the primary
State.</text>
</subsection></section></part><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H9E9B114321434268BB03E469F2ADD02D"><enum>(b)</enum><header>Effective
Date</header><text>The amendment made by subsection (a) shall apply to
individual health insurance coverage offered, issued, or sold after the date
that is one year after the date of the enactment of this Act.</text>
</subsection><subsection id="H358B7CCFDCB3476FA56F26DFA406DC21"><enum>(c)</enum><header>GAO Ongoing
Study and Reports</header>
<paragraph id="H3AB26B77B03540B28CBC7F1CBF754D85"><enum>(1)</enum><header>Study</header><text>The
Comptroller General of the United States shall conduct an ongoing study
concerning the effect of the amendment made by subsection (a) on—</text>
<subparagraph id="H2BA57FAE4A874E178FB6CC23E23B6F1B"><enum>(A)</enum><text>the number of
uninsured and under-insured;</text>
</subparagraph><subparagraph id="H4902B50134AD4084A4842057B0E0EC9D"><enum>(B)</enum><text>the availability
and cost of health insurance policies for individuals with pre-existing medical
conditions;</text>
</subparagraph><subparagraph id="HCB295157A64148CAA4295D2236AA7542"><enum>(C)</enum><text>the availability
and cost of health insurance policies generally;</text>
</subparagraph><subparagraph id="H2164B0564B3947C88BD09D351F7F6DD7"><enum>(D)</enum><text>the elimination or
reduction of different types of benefits under health insurance policies
offered in different States; and</text>
</subparagraph><subparagraph id="H1FFBD290AF764E12A15DAB8AAB8B41FE"><enum>(E)</enum><text>cases of fraud or
abuse relating to health insurance coverage offered under such amendment and
the resolution of such cases.</text>
</subparagraph></paragraph><paragraph id="HEF3A13E40A0C4272A47D7E9A6334CCB6"><enum>(2)</enum><header>Annual
reports</header><text>The Comptroller General shall submit to Congress an
annual report, after the end of each of the 5 years following the effective
date of the amendment made by subsection (a), on the ongoing study conducted
under paragraph (1).</text>
</paragraph></subsection><subsection id="H215AF476849B4E4B954274CFE90281C6"><enum>(d)</enum><header>Severability</header><text>If
any provision of the section or the application of such provision to any person
or circumstance is held to be unconstitutional, the remainder of this section
and the application of the provisions of such to any other person or
circumstance shall not be affected.</text>
</subsection></section><enum>IV</enum><header>Safety Net
Reforms</header>
<section display-inline="no-display-inline" id="HBC26D1F788D94FE992DFC2FB76676099"><enum>401.</enum><header>Requiring
outreach and coverage before expansion of eligibility</header>
<subsection id="HA102C8E74B99499DB6DFFA02F1E46A70"><enum>(a)</enum><header>State plan
required To specify how it will achieve coverage for 90 percent of targeted
low-Income children</header>
<paragraph id="H3F0D423942834365B3CCC3B6915B4702"><enum>(1)</enum><header>In
general</header><text>Section 2102(a) of the Social Security Act (42 U.S.C.
1397bb(a)) is amended—</text>
<subparagraph id="H70576851B7A7422B9BEF10822D2C71A1"><enum>(A)</enum><text>in paragraph (6),
by striking <quote>and</quote> at the end;</text>
</subparagraph><subparagraph id="H8972507ED6124F03BC8596E0136609A7"><enum>(B)</enum><text>in paragraph (7),
by striking the period at the end and inserting <quote>; and</quote>;
and</text>
</subparagraph><subparagraph id="H5C03136644C845478CA5017092CCFD4D"><enum>(C)</enum><text>by adding at the
end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H52F8FD3F0CE449C09387415453C52B20" style="OLC">
<paragraph id="H9ABC264E2F024F1E93122372DA163482"><enum>(8)</enum><text display-inline="yes-display-inline">how the eligibility and benefits provided
for under the plan for each fiscal year (beginning with fiscal year 2011) will
allow for the State's annual funding allotment to cover at least 90 percent of
the eligible targeted low-income children in the
State.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="H813E5C9FB6374D3383782CD68D3C2F43"><enum>(2)</enum><header>Effective
date</header><text>The amendments made by paragraph (1) shall apply to State
child health plans for fiscal years beginning with fiscal year 2011.</text>
</paragraph></subsection><subsection id="H9A94163201EA490EA1FB8FBA0BDF87F8"><enum>(b)</enum><header>Limitation on
program expansions until lowest income eligible individuals
enrolled</header><text>Section 2105(c) of such Act (42 U.S.C. 1397dd(c)) is
amended by adding at the end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H5A1D74491B8845FFB0BB4079DD4B1180" style="OLC">
<paragraph id="HF55D61EC065E4503A9D52A4C64604604"><enum>(8)</enum><header>Limitation on
increased coverage of higher income children</header><text>For child health
assistance furnished in a fiscal year beginning with fiscal year 2011:</text>
<subparagraph id="H3ACD1FCDA38B4389B6138FDAD4449BFE"><enum>(A)</enum><header>No payment for
children with family income above 300 percent of poverty line</header><text display-inline="yes-display-inline">Payment shall not be made under this
section for child health assistance for a targeted low-income child in a family
the income of which exceeds 300 percent of the poverty line applicable to a
family of the size involved.</text>
</subparagraph><subparagraph id="H5EE570DCE9CE4A479BAA1C82302F6C72"><enum>(B)</enum><header>Special rules
for payment for children with family income above 200 percent of poverty
line</header><text display-inline="yes-display-inline">In the case of child
health assistance for a targeted low-income child in a family the income of
which exceeds 200 percent (but does not exceed 300 percent) of the poverty line
applicable to a family of the size involved no payment shall be made under this
section for such assistance unless the State demonstrates to the satisfaction
of the Secretary that—</text>
<clause id="HAD65EEA1EFC34367923F056EA1148CB9"><enum>(i)</enum><text>the State has met
the 90 percent retrospective coverage test specified in subparagraph (C)(i) for
the previous fiscal year; and</text>
</clause><clause id="H6287FAC83A594915957E17B9AD871407"><enum>(ii)</enum><text>the State will
meet the 90 percent prospective coverage test specified in subparagraph (C)(ii)
for the fiscal year.</text>
</clause></subparagraph><subparagraph id="HB8A0ECFBEBFC46C0B34E7AA017532FAE"><enum>(C)</enum><header>90 percent
coverage tests</header>
<clause id="H9459BD79552E4C3AB12EBD66A9EFC5F8"><enum>(i)</enum><header>Retrospective
test</header><text>The 90 percent retrospective coverage test specified in this
clause is, for a State for a fiscal year, that on average during the fiscal
year, the State has enrolled under this title or title XIX at least 90 percent
of the individuals residing in the State who—</text>
<subclause id="HBF0B8315360343D29FBB21941E465BE5"><enum>(I)</enum><text>are children under
19 years of age (or are pregnant women) and are eligible for medical assistance
under title XIX; or</text>
</subclause><subclause id="H7C667C871C9543B79A32282D75E8F736"><enum>(II)</enum><text>are targeted
low-income children whose family income does not exceed 200 percent of the
poverty line and who are eligible for child health assistance under this
title.</text>
</subclause></clause><clause id="H47EECDDAD9A44CC4BCBE02A7FE0BE9C2"><enum>(ii)</enum><header>Prospective
test</header><text>The 90 percent prospective test specified in this clause is,
for a State for a fiscal year, that on average during the fiscal year, the
State will enroll under this title or title XIX at least 90 percent of the
individuals residing in the State who—</text>
<subclause id="HFB0C61E9835F436A9D553355DC51719A"><enum>(I)</enum><text>are children under
19 years of age (or are pregnant women) and are eligible for medical assistance
under title XIX; or</text>
</subclause><subclause id="H62BC402129854016AD6D04FF7CDAD13D"><enum>(II)</enum><text display-inline="yes-display-inline">are targeted low-income children whose
family income does not exceed such percent of the poverty line (in excess of
200 percent) as the State elects consistent with this paragraph and who are
eligible for child health assistance under this title.</text>
</subclause></clause></subparagraph><subparagraph id="H6A9103EA8FDD4FE389B678BAB4A0079B"><enum>(D)</enum><header>Grandfather</header><text>Subparagraphs
(A) and (B) shall not apply to the provision of child health assistance—</text>
<clause id="HDFC701E728AA4310B6249CDA6E4F28C9"><enum>(i)</enum><text>to
a targeted low-income child who is enrolled for child health assistance under
this title as of September 30, 2008;</text>
</clause><clause id="H1DADA57B950D497C9B919F94AE30BC06"><enum>(ii)</enum><text>to a pregnant
woman who is enrolled for assistance under this title as of September 30, 2009,
through the completion of the post-partum period following completion of her
pregnancy; and</text>
</clause><clause id="HC38B45824773446E8FB3B35A13437A12"><enum>(iii)</enum><text>for items and
services furnished before October 1, 2010, to an individual who is not a
targeted low-income child and who is enrolled for assistance under this title
as of September 30, 2009.</text>
</clause></subparagraph><subparagraph id="H199333B5917248DE9AF65F398FE94A74"><enum>(E)</enum><header>Treatment of
pregnant women</header><text display-inline="yes-display-inline">In this
paragraph and sections 2102(a)(8) and 2104(a)(2), the term <term>targeted
low-income child</term> includes an individual under age 19, including the
period from conception to birth, who is eligible for child health assistance
under this title by virtue of the definition of the term <term>child</term>
under section 457.10 of title 42, Code of Federal
Regulations.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H431B16E12E0342CD82C917B75433D977"><enum>(c)</enum><header>Standardization
of income determinations</header>
<paragraph id="H5F5B4F57651A41C88F236B7B8461A133"><enum>(1)</enum><header>In
general</header><text>Section 2110(d) of such Act (42 U.S.C. 1397jj) is amended
by adding at the end the following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="HD93AB0B3B8AE46F0AD17E3DAD1895612" style="OLC">
<subsection id="HE2BD86E1F90D4E88B3730A1BC17ACDE3"><enum>(d)</enum><header>Standardization
of income determinations</header><text>In determining family income under this
title (including in the case of a State child health plan that provides health
benefits coverage in the manner described in section 2101(a)(2)), a State shall
base such determination on gross income (including amounts that would be
included in gross income if they were not exempt from income taxation) and may
only take into consideration such income disregards as the Secretary shall
develop.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="H78FD085FD0BC467D916EF5438FAA962F"><enum>(2)</enum><header>Effective
date</header><subparagraph commented="no" display-inline="yes-display-inline" id="H0FED32F216AF4FDB975D33E1887B60FE"><enum>(A)</enum><text>Subject to subparagraph
(B), the amendment made by paragraph (1) shall apply to determinations (and
redeterminations) of income made on or after April 1, 2010.</text>
</subparagraph><subparagraph id="H12B65AC03F634FE98D93793FC9221678" indent="up1"><enum>(B)</enum><text display-inline="yes-display-inline">In
the case of a State child health plan under title XXI of the Social Security
Act which the Secretary of Health and Human Services determines requires State
legislation (other than legislation appropriating funds) in order for the plan
to meet the additional requirement imposed by the amendment made by paragraph
(1), the State child health plan shall not be regarded as failing to comply
with the requirements of such title solely on the basis of its failure to meet
this additional requirement before the first day of the first calendar quarter
beginning after the close of the first regular session of the State legislature
that begins after the date of the enactment of this Act. For purposes of the
previous sentence, in the case of a State that has a 2-year legislative
session, each year of such session shall be deemed to be a separate regular
session of the State legislature.</text>
</subparagraph></paragraph></subsection></section><section display-inline="no-display-inline" id="H831C57426DFD4F4F855531A7EF3490F0"><enum>402.</enum><header>Easing
administrative barriers to State cooperation with employer-sponsored insurance
coverage</header>
<subsection id="H85A73DB0680C4A7F908DBE02A5A637C6"><enum>(a)</enum><header>Requiring some
coverage for employer-Sponsored insurance</header>
<paragraph id="HB33CE5D1591A457E9A7DA1F50B01B7FA"><enum>(1)</enum><header>In
general</header><text>Section 2102(a) of the Social Security Act (42 U.S.C.
1397b(a)), as amended by section 401(a), is amended—</text>
<subparagraph id="H80B822B94EF34CFC973150BB3D9D3AD4"><enum>(A)</enum><text>in paragraph (7),
by striking <quote>and</quote> at the end;</text>
</subparagraph><subparagraph id="HC52A866437DB4FDCBECB8D08192D8EB0"><enum>(B)</enum><text>in paragraph (8),
by striking the period at the end and inserting <quote>; and</quote>;
and</text>
</subparagraph><subparagraph id="H62DFA13AF3B84EA0BB6D9FFB2C16FFEC"><enum>(C)</enum><text>by adding at the
end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H0CE9E823E29341ECBDFAB73FCEC0086B" style="OLC">
<paragraph id="H7C25E4A1217F48A198D94CDAD9475A20"><enum>(9)</enum><text display-inline="yes-display-inline">effective for plan years beginning on or
after October 1, 2010, how the plan will provide for child health assistance
with respect to targeted low-income children covered under a group health
plan.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="H72BD0861EDEB4734B1563BE0E9ACCBCD"><enum>(2)</enum><header>Effective
date</header><text>The amendment made by paragraph (1) shall apply beginning
with fiscal year 2011.</text>
</paragraph></subsection><subsection id="H65AA654966E144859C8DBB800C590B8D"><enum>(b)</enum><header>Federal
financial participation for employer-Sponsored insurance</header><text display-inline="yes-display-inline">Section 2105 of such Act (42 U.S.C. 1397d)
is amended—</text>
<paragraph id="HDC918358E25847728779E34CB1E5AF24"><enum>(1)</enum><text>in subsection
(a)(1)(C), by inserting before the semicolon at the end the following:
<quote>and, subject to paragraph (3)(C), in the form of payment of the premiums
for coverage under a group health plan that includes coverage of targeted
low-income children and benefits supplemental to such coverage</quote>;
and</text>
</paragraph><paragraph id="H6F975093E87D4DABB95792A4B821875B"><enum>(2)</enum><text>by amending
paragraph (3) of subsection (c) to read as follows:</text>
<quoted-block display-inline="no-display-inline" id="H18472642CB464752858FDD562FA5FE85" style="OLC">
<paragraph id="H8606A30BBD8042A5BD48AC335C092F2D"><enum>(3)</enum><header>Purchase of
employer-sponsored insurance</header>
<subparagraph id="HC0C575CE070B4B86AAFC52661B1AE481"><enum>(A)</enum><header>In
general</header><text>Payment may be made to a State under subsection
(a)(1)(C), subject to the provisions of this paragraph, for the purchase of
family coverage under a group health plan that includes coverage of targeted
low-income children unless such coverage would otherwise substitute for
coverage that would be provided to such children but for the purchase of family
coverage.</text>
</subparagraph><subparagraph id="HBAA103D36EBC4F63B719D92536F1F703"><enum>(B)</enum><header>Waiver of
certain provisions</header><text display-inline="yes-display-inline">With
respect to coverage described in subparagraph (A)—</text>
<clause id="H750AFF43B1D944178277260EB2F7132F"><enum>(i)</enum><text>notwithstanding
section 2102, no minimum benefits requirement (other than those otherwise
applicable with respect to services referred to in section 2102(a)(7)) under
this title shall apply; and</text>
</clause><clause id="HD10A9D0C2D814F5C9932D5D00CF9DA5C"><enum>(ii)</enum><text>no limitation on
beneficiary cost-sharing otherwise applicable under this title or title XIX
shall apply.</text>
</clause></subparagraph><subparagraph id="HB27F6921F1A6413AA50B540A355173B9"><enum>(C)</enum><header>Required
provision of supplemental benefits</header><text>If the coverage described in
subparagraph (A) does not provide coverage for the services referred to in
section 2102(a)(7), the State child health plan shall provide coverage of such
services as supplemental benefits.</text>
</subparagraph><subparagraph id="H663F643EE7094EE89A238240A6CD73C4"><enum>(D)</enum><header>Limitation on
FFP</header><text>The amount of the payment under paragraph (1)(C) for coverage
described in subparagraph (A) (and supplemental benefits under subparagraph (C)
for individuals so covered) during a fiscal year may not exceed the product
of—</text>
<clause id="HF2CE394A39224D7385BFE54D97AD40D3"><enum>(i)</enum><text>the national per
capita expenditure under this title (taking into account both Federal and State
expenditures) for the previous fiscal year (as determined by the Secretary
using the best available data);</text>
</clause><clause id="H37519508763E4C0C965CF92CF30FF002"><enum>(ii)</enum><text>the enhanced FMAP
for the State and fiscal year involved; and</text>
</clause><clause id="H138EF2DB3C0549C0B4D7C015832836CE"><enum>(iii)</enum><text>the number of
targeted low-income children for whom such coverage is provided.</text>
</clause></subparagraph><subparagraph id="H805CAE6B413C4020914BA65CEF654DE8"><enum>(E)</enum><header>Voluntary
enrollment</header><text>A State child health plan—</text>
<clause id="HEF3FBD8AA7614DE5AC596456A15FD60F"><enum>(i)</enum><text>may not require a
targeted low-income child to enroll in coverage described in subparagraph (A)
in order to obtain child health assistance under this title;</text>
</clause><clause id="H0E66C049ED66404D9B71B335AF002AF3"><enum>(ii)</enum><text display-inline="yes-display-inline">before providing such child health
assistance for such coverage of a child, shall make available (which may be
through an Internet website or other means including the State transparency
plan portal established under section 901 of the
<short-title>Siding with America’s Patients
Act</short-title>) to the parent or guardian of the child information on the
coverage available under this title, including benefits and cost-sharing;
and</text>
</clause><clause id="H6B077104933D427187FBADA8FFA8F9F2"><enum>(iii)</enum><text>shall provide at
least one opportunity per fiscal year for beneficiaries to switch coverage
under this title from coverage described in subparagraph (A) to the coverage
that is otherwise made available under this title.</text>
</clause></subparagraph><subparagraph id="HA50809AF5B014CCAB5F3CF99587E3D95"><enum>(F)</enum><header>Information on
coverage options</header><text>A State child health plan shall—</text>
<clause id="H77207031C60A4BB498288E2996347193"><enum>(i)</enum><text display-inline="yes-display-inline">describe how the State will notify
potential beneficiaries of coverage described in subparagraph (A);</text>
</clause><clause id="H236FEFB8BC034F6596C592B690BFC5AE"><enum>(ii)</enum><text>provide such
notification in writing at least during the initial application for enrollment
under this title and during redeterminations of eligibility if the individual
was enrolled before October 1, 2010; and</text>
</clause><clause id="H76E1A0DB49E8453581AFB9B94D249B1C"><enum>(iii)</enum><text display-inline="yes-display-inline">post a description of these coverage
options on any official website that may be established by the State in
connection with the plan, including the State transparency plan portal
established under section 901 of the <short-title>Siding
with America’s Patients Act</short-title>.</text>
</clause></subparagraph><subparagraph id="H1B4C8F99ECFC4FB28A7CC198897408DB"><enum>(G)</enum><header>Semiannual
verification of coverage</header><text>If coverage described in subparagraph
(A) is provided under a group health plan with respect to a targeted low-income
child, the State child health plan shall provide for the collection, at least
once every six months, of proof from the plan that the child is enrolled in
such coverage.</text>
</subparagraph><subparagraph display-inline="no-display-inline" id="H56E9107E91ED4F9298D91DD754FC493F"><enum>(H)</enum><header>Rule of
construction</header><text display-inline="yes-display-inline">Nothing in this
section is to be construed to prohibit a State from—</text>
<clause id="HB10D8BBC6BD948CA93C91701A83D20DC"><enum>(i)</enum><text display-inline="yes-display-inline">offering wrap around benefits in order for
a group health plan to meet any State-established minimum benefit
requirements;</text>
</clause><clause id="H1C5B6E62883B44C693FFBA5B661ECBDD"><enum>(ii)</enum><text display-inline="yes-display-inline">establishing a cost-effectiveness test to
qualify for coverage under such a plan;</text>
</clause><clause id="H0717F532365943BEBD2716C2178516E1"><enum>(iii)</enum><text display-inline="yes-display-inline">establishing limits on beneficiary
cost-sharing under such a plan;</text>
</clause><clause id="HB1B9D80E3171430F885BE4105EA2B80B"><enum>(iv)</enum><text display-inline="yes-display-inline">paying all or part of a beneficiary’s
cost-sharing requirements under such a plan;</text>
</clause><clause id="H860040C5394446CCA094BC5670B53E5A"><enum>(v)</enum><text display-inline="yes-display-inline">paying less than the full cost of the
employee’s share of the premium under such a plan, including prorating the cost
of the premium to pay for only what the State determines is the portion of the
premium that covers targeted low-income children;</text>
</clause><clause id="H4D199DB0DF684970A8704ADC58E3BA88"><enum>(vi)</enum><text display-inline="yes-display-inline">using State funds to pay for benefits above
the Federal upper limit established under subparagraph (C);</text>
</clause><clause id="H649CF33ED36C46F7A5DD02F74A9430DC"><enum>(vii)</enum><text display-inline="yes-display-inline">allowing beneficiaries enrolled in group
health plans from changing plans to another coverage option available under
this title at any time; or</text>
</clause><clause id="HB8491BFE20FF4859A37F86B8D613C38A"><enum>(viii)</enum><text display-inline="yes-display-inline">providing any guidance or information it
deems appropriate in order to help beneficiaries make an informed decision
regarding the option to enroll in coverage described in subparagraph
(A).</text>
</clause></subparagraph><subparagraph id="H414DCA3A84AD436F913C2055870EA960"><enum>(I)</enum><header>Group health
plan defined</header><text>In this paragraph, the term <term>group health
plan</term> has the meaning given such term in section 2791(a)(1) of the Public
Health Service Act (42 U.S.C.
300gg–91(a)(1)).</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection display-inline="no-display-inline" id="HFE294272BDE74165ABD24F49F5B81276"><enum>(c)</enum><header>Application
under Medicaid</header><text>The Secretary of Health and Human Services shall
provide for the application of the amendments made by subsections (a) and (b)
under the Medicaid program under title XIX of the Social Security Act in the
same manner as such amendments apply to SCHIP under title XXI of such
Act.</text>
</subsection></section><section id="H8B8D3A7C8A73439398AFC0EB610919CE"><enum>403.</enum><header>Improving
beneficiary choice in SCHIP</header>
<subsection id="H3FB02CBE6C0245B786F8F098320D4DEA"><enum>(a)</enum><header>Requiring
offering of alternative coverage options</header><text>Section 2102 of the
Social Security Act (42 U.S.C. 1397b), as amended by sections 401(a) and
402(a), is amended—</text>
<paragraph id="H2EB1164AAE304D558DB607216E857F86"><enum>(1)</enum><text>in subsection
(a)—</text>
<subparagraph id="HC96EAB7F21AC4DE0B6D3E952C4239F17"><enum>(A)</enum><text>in paragraph (8),
by striking <quote>and</quote> at the end;</text>
</subparagraph><subparagraph id="H8E0129246EF3401990D134CEF9F47AE9"><enum>(B)</enum><text>in paragraph (9),
by striking the period at the end and inserting <quote>; and</quote>;
and</text>
</subparagraph><subparagraph id="H7FA20F0D700F4EB08AA26B9412485405"><enum>(C)</enum><text>by adding at the
end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H722CC89002824F3D99B29365D67C412C" style="OLC">
<paragraph id="H81F994B3B36942E2B0296243727EAA6E"><enum>(10)</enum><text display-inline="yes-display-inline">effective for plan years beginning on or
after October 1, 2010, how the plan will provide for child health assistance
with respect to targeted low-income children through alternative coverage
options in accordance with subsection
(e).</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="HECD567D1E63E43F19C1C5AEB60A436C2"><enum>(2)</enum><text>by adding at the
end the following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="H794FEFD84C8E467197C2279318D1344D" style="OLC">
<subsection id="H7EC246DDDDCC470DAB1715DD79AD33D2"><enum>(e)</enum><header>Alternative
coverage options</header>
<paragraph id="H0514A0049C3840E4A309E61B2C624BC3"><enum>(1)</enum><header>In
general</header><text>Effective October 1, 2010, a State child health plan
shall provide for the offering of any qualified alternative coverage that a
qualified entity seeks to offer to targeted low-income children through the
plan in the State.</text>
</paragraph><paragraph id="HB5F42C1357B746CBA9DA940611C8AADE"><enum>(2)</enum><header>Application of
uniform financial limitation for all alternative coverage
options</header><text>With respect to all qualified alternative coverage
offered in a State, the State child health plan shall establish a uniform
dollar limitation on the per capita monthly amount that will be paid by the
State to the qualified entity with respect to such coverage provided to a
targeted low-income child. Such limitation may not be less than 90 percent of
the per capita monthly payment made for coverage offered under the State child
health plan that is not in the form of an alternative coverage option. Nothing
in this paragraph shall be construed—</text>
<subparagraph id="H32D5F851C0794651B83DE5F6D31E65DF"><enum>(A)</enum><text>as requiring a
State to provide for the full payment of premiums for qualified alternative
coverage;</text>
</subparagraph><subparagraph id="HA7F65D9A9847417DAEF60586634D6BA6"><enum>(B)</enum><text>as preventing a
State from charging additional premiums to cover the difference between the
cost of qualified alternative coverage and the amount of such payment
limitation; or</text>
</subparagraph><subparagraph id="H1F2C3D30F7184533A752E4A2332E01AE"><enum>(C)</enum><text>as preventing a
State from using its own funds to provide a dollar limitation that exceeds the
Federal financial participation as limited under section 2105(c)(10).</text>
</subparagraph></paragraph><paragraph id="H64D9729153E34BCCA6F7A394B8E88450"><enum>(3)</enum><header>Treatment of low
cost coverage</header>
<subparagraph id="H93AAE8B80F9541C28EF0EA63C170FCF8"><enum>(A)</enum><header>In
general</header><text>Except as provided in subparagraph (B), if the uniform
dollar limitation under paragraph (2) exceeds the premium for qualified
alternative coverage for an enrollee, then such excess shall be refunded to the
Federal and State governments in the same proportion as is otherwise applicable
to recovered funds under this title.</text>
</subparagraph><subparagraph id="H4059D95CEF00495CA932DCFFBDEC6250"><enum>(B)</enum><header>Exception for
high deductible health plans</header><text>In the case of coverage under a high
deductible health plan, the excess described in subparagraph (A) shall be
deposited into a health savings account established with respect to such
plan.</text>
</subparagraph></paragraph><paragraph id="H1A00D7C4208B4C82ACE8EFA43049C6D2"><enum>(4)</enum><header>Exemption</header><text display-inline="yes-display-inline">A State is not subject to the requirement
of paragraph (1) if the State child health plan provides, as of the date of the
enactment of this subsection, for a cash out or health savings account type
option for those enrolled under the plan.</text>
</paragraph><paragraph id="HAFB3F13A48264BF8AA76F85AAFA63BFD"><enum>(5)</enum><header>Qualified
alternative coverage defined</header><text>In this section, the term
<term>qualified alternative coverage</term> means health insurance coverage
that—</text>
<subparagraph id="H197540B20C324C23B2CB27CC661A5E20"><enum>(A)</enum><text>meets the coverage
requirements of section 2103 (other than cost-sharing requirements of such
section); and</text>
</subparagraph><subparagraph id="H9E7A22D9E1C242D69AFFD39885EFF71E"><enum>(B)</enum><text>is offered by a
qualified insurer, and not directly by the State.</text>
</subparagraph></paragraph><paragraph id="H22ECF49F92FA4370986D0700ADADF730"><enum>(6)</enum><header>Qualified
insurer defined</header><text>In this section, the term <term>qualified
insurer</term> means, with respect to a State, an entity that is licensed to
offer health insurance coverage in the
State.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="HC12BA3DA8A584ECEACAF926CAA00BA79"><enum>(b)</enum><header>Federal
financial participation for qualified alternative coverage</header><text display-inline="yes-display-inline">Section 2105 of such Act (42 U.S.C. 1397d)
is amended—</text>
<paragraph id="HDE75E8EF1A014D649B84B5F05EB417EA"><enum>(1)</enum><text>in subsection
(a)(1)(C), as amended by section 402(b), by inserting before the semicolon at
the end the following: <quote>and, subject to paragraph (8)(C), in the form of
payment of the premiums for coverage for qualified alternative
coverage</quote>; and</text>
</paragraph><paragraph id="H87CBAF30E0E34E71835DE47784DD9599"><enum>(2)</enum><text>in subsection (c),
by adding at the end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H77BC941F95BC47AFA2476CA95DEADFE1" style="OLC">
<paragraph id="H1C9D318140AE4309AB8A13804EDA1E27"><enum>(12)</enum><header>Purchase of
qualified alternative coverage</header>
<subparagraph id="H9D7785386C384F5F804081C504727BF8"><enum>(A)</enum><header>In
general</header><text>Payment may be made to a State under subsection
(a)(1)(C), subject to the provisions of this paragraph, for the purchase of
qualified alternative coverage.</text>
</subparagraph><subparagraph id="HF7B979E850DE485BB671BC152AE7A615"><enum>(B)</enum><header>Waiver of
certain provisions</header><text display-inline="yes-display-inline">With
respect to coverage described in subparagraph (A), no limitation on beneficiary
cost-sharing otherwise applicable under this title or title XIX shall
apply.</text>
</subparagraph><subparagraph id="HC1DBA8EE4F354DADA79BB7FC3DBD7C0A"><enum>(C)</enum><header>Limitation on
FFP</header><text>The amount of the payment under paragraph (1)(C) for coverage
described in subparagraph (A) during a fiscal year in the aggregate for all
such coverage in the State may not exceed the product of—</text>
<clause id="HF07FBF556C8245A69B4F34493D90292D"><enum>(i)</enum><text>the national per
capita expenditure under this title (taking into account both Federal and State
expenditures) for the previous fiscal year (as determined by the Secretary
using the best available data);</text>
</clause><clause id="H72ACDAC7E0DC4F6395C0A869D12B9D46"><enum>(ii)</enum><text>the enhanced FMAP
for the State and fiscal year involved; and</text>
</clause><clause id="HCC6326DABAD347479D0C1B0BB5A14EAA"><enum>(iii)</enum><text>the number of
targeted low-income children for whom such coverage is provided.</text>
</clause></subparagraph><subparagraph id="HF9BC5567E76A46F79391FD9A0E454D84"><enum>(D)</enum><header>Voluntary
enrollment</header><text>A State child health plan—</text>
<clause id="H9F26F8D4E7B542C6B32A5B2ACC357047"><enum>(i)</enum><text>may not require a
targeted low-income child to enroll in coverage described in subparagraph (A)
in order to obtain child health assistance under this title;</text>
</clause><clause id="H718910C8DAEA428C86E687562471433A"><enum>(ii)</enum><text display-inline="yes-display-inline">before providing such child health
assistance for such coverage of a child, shall make available (which may be
through an Internet website or other means) to the parent or guardian of the
child information on the coverage available under this title, including
benefits and cost-sharing; and</text>
</clause><clause id="HC5689ABEE27D4C49B68D5098089CA6AA"><enum>(iii)</enum><text>shall provide at
least one opportunity per fiscal year for beneficiaries to switch coverage
under this title from coverage described in subparagraph (A) to the coverage
that is otherwise made available under this title.</text>
</clause></subparagraph><subparagraph id="H86E4C94FE04D4E118FE0D2E853353503"><enum>(E)</enum><header>Information on
coverage options</header><text>A State child health plan shall—</text>
<clause id="H6598AC2D08894BCE9DF22EA9DED93CBE"><enum>(i)</enum><text display-inline="yes-display-inline">describe how the State will notify
potential beneficiaries of coverage described in subparagraph (A);</text>
</clause><clause id="HD5079F4E135945A19565F36E3E1B9619"><enum>(ii)</enum><text>provide such
notification in writing at least during the initial application for enrollment
under this title and during redeterminations of eligibility if the individual
was enrolled before October 1, 2010; and</text>
</clause><clause id="HA2F0A3444E7841B1B721C11EA8842E91"><enum>(iii)</enum><text>post a
description of these coverage options on any official website that may be
established by the State in connection with the plan.</text>
</clause></subparagraph><subparagraph display-inline="no-display-inline" id="HE01D6D2F574B44F9B176B6680AA008FD"><enum>(F)</enum><header>Rule of
construction</header><text display-inline="yes-display-inline">Nothing in this
section is to be construed to prohibit a State from—</text>
<clause id="H573364FC45A947259373A7495F8C4055"><enum>(i)</enum><text display-inline="yes-display-inline">establishing limits on beneficiary
cost-sharing under such alternative coverage;</text>
</clause><clause id="HE0205A594CC84E5E8E97E16EAD4F899B"><enum>(ii)</enum><text display-inline="yes-display-inline">paying all or part of a beneficiary’s
cost-sharing requirements under such coverage;</text>
</clause><clause id="H144F001D2BCC481989BBEB4653995200"><enum>(iii)</enum><text display-inline="yes-display-inline">paying less than the full cost of a child’s
share of the premium under such coverage, insofar as the premium for such
coverage exceeds the limitation established by the State under subparagraph
(C);</text>
</clause><clause id="H3447B4F0A1524E15BDEACF9D16137E32"><enum>(iv)</enum><text display-inline="yes-display-inline">using State funds to pay for benefits above
the Federal upper limit established under subparagraph (C); or</text>
</clause><clause id="H13E54431BBFF4B149E6DB116A6A72331"><enum>(v)</enum><text display-inline="yes-display-inline">providing any guidance or information it
deems appropriate in order to help beneficiaries make an informed decision
regarding the option to enroll in coverage described in subparagraph
(A).</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection display-inline="no-display-inline" id="H98B8CC740BA04618ACA404E559810037"><enum>(c)</enum><header>Application
under Medicaid</header><text>The Secretary of Health and Human Services shall
provide for the application of the amendments made by subsections (a) and (b)
under the Medicaid program under title XIX of the Social Security Act in the
same manner as such amendments apply to SCHIP under title XXI of such
Act.</text>
</subsection></section><section id="H9771E025832244E780E652747648A0B0"><enum>404.</enum><header>Liability
protections for health center volunteer practitioners</header>
<subsection id="HADA4B80C789C4A8BBA429AFAECF5BC59"><enum>(a)</enum><header>In
General</header><text>Section 224 of the Public Health Service Act (42 U.S.C.
233) is amended—</text>
<paragraph id="H902D01F684054E56A352C24CDFF768B6"><enum>(1)</enum><text>in subsection
(g)(1)(A)—</text>
<subparagraph id="HE34DFE217406421CBF386EF4DD1052B7"><enum>(A)</enum><text>in the first
sentence, by striking <quote>or employee</quote> and inserting <quote>employee,
or (subject to subsection (k)(4)) volunteer practitioner</quote>; and</text>
</subparagraph><subparagraph id="HB4AA5D5F01DB43AFB3F4F5AA6DE298CA"><enum>(B)</enum><text>in the second
sentence, by inserting <quote>and subsection (k)(4)</quote> after
<quote>subject to paragraph (5)</quote>; and</text>
</subparagraph></paragraph><paragraph id="HB61E1986560646B1B944E36F1D42B419"><enum>(2)</enum><text>in each of
subsections (g), (i), (j), (k), (l), and (m)—</text>
<subparagraph id="H7EA98500ECAA45D79E4C205DD1912982"><enum>(A)</enum><text>by striking the
term <term>employee, or contractor</term> each place such term appears and
inserting <quote>employee, volunteer practitioner, or
contractor</quote>;</text>
</subparagraph><subparagraph id="H59B97872993E492F997281E67E47D845"><enum>(B)</enum><text>by striking the
term <term>employee, and contractor</term> each place such term appears and
inserting <quote>employee, volunteer practitioner, and
contractor</quote>;</text>
</subparagraph><subparagraph id="HD4C150AE8B7A4648A6525A8E0730D5F0"><enum>(C)</enum><text>by striking the
term <term>employee, or any contractor</term> each place such term appears and
inserting <quote>employee, volunteer practitioner, or contractor</quote>;
and</text>
</subparagraph><subparagraph id="H5A251AA1822B4893A3609816E19950B4"><enum>(D)</enum><text>by striking the
term <term>employees, or contractors</term> each place such term appears and
inserting <quote>employees, volunteer practitioners, or
contractors</quote>.</text>
</subparagraph></paragraph></subsection><subsection id="H350D697369F94912A3D1CE62460ED779"><enum>(b)</enum><header>Applicability;
Definition</header><text>Section 224(k) of the Public Health Service Act (42
U.S.C. 233(k)) is amended by adding at the end the following paragraph:</text>
<quoted-block id="HFB95869D9B6A48DEBE2BEBA173A5DA8D" style="OLC">
<paragraph id="HDB5B7A18AD724E798C26BE37A04A76EF" indent="up1"><enum>(4)</enum><subparagraph commented="no" display-inline="yes-display-inline" id="HC4C4E2E8BE994277AEF543C13007DD6B"><enum>(A)</enum><text>Subsections (g) through
(m) apply with respect to volunteer practitioners beginning with the first
fiscal year for which an appropriations Act provides that amounts in the fund
under paragraph (2) are available with respect to such practitioners.</text>
</subparagraph><subparagraph id="H1AA25FC510474F72BB2BE1D4F42BEA1A" indent="up1"><enum>(B)</enum><text>For purposes of subsections (g)
through (m), the term <term>volunteer practitioner</term> means a practitioner
who, with respect to an entity described in subsection (g)(4), meets the
following conditions:</text>
<clause id="H1BC4601FE0824928A1959B18F6CA6483"><enum>(i)</enum><text>In the State involved, the
practitioner is a licensed physician, a licensed clinical psychologist, or
other licensed or certified health care practitioner.</text>
</clause><clause id="HC00903E104834CCFA7E09751F97ADF0C"><enum>(ii)</enum><text>At the request of such entity, the
practitioner provides services to patients of the entity, at a site at which
the entity operates or at a site designated by the entity. The weekly number of
hours of services provided to the patients by the practitioner is not a factor
with respect to meeting conditions under this subparagraph.</text>
</clause><clause id="H74366D47EEA74A90A06D790AFC433CEB"><enum>(iii)</enum><text>The practitioner does not for the
provision of such services receive any compensation from such patients, from
the entity, or from third-party payors (including reimbursement under any
insurance policy or health plan, or under any Federal or State health benefits
program).</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="HF395367FD24F4C2F974E2E66506CF24B"><enum>405.</enum><header>Liability
protections for health center practitioners providing services in emergency
areas</header><text display-inline="no-display-inline">Section 224(g) of the
Public Health Service Act (42 U.S.C. 233(g)) is amended—</text>
<paragraph id="H09C582EA35E74DBE80292D1DA22D1CC2"><enum>(1)</enum><text>in paragraph
(1)(B)(ii), by striking <quote>subparagraph (C)</quote> and inserting
<quote>subparagraph (C) and paragraph (6)</quote>; and</text>
</paragraph><paragraph id="HBEB1E2D6CF3B463B84CC06E443522074"><enum>(2)</enum><text>by adding at the
end the following paragraph:</text>
<quoted-block id="H6B5DBB0858A3469B815B757E3479314F" style="OLC">
<paragraph id="HD49F393DDDAA40BDB060DA387D0CE7B3" indent="up1"><enum>(6)</enum><subparagraph commented="no" display-inline="yes-display-inline" id="H7DEE5B5AB3DF4F9986614D813E13C05D"><enum>(A)</enum><text>Subject to subparagraph
(C), paragraph (1)(B)(ii) applies to health services provided to individuals
who are not patients of the entity involved if, as determined under criteria
issued by the Secretary, the following conditions are met:</text>
<clause id="H6A0D2890CEC24EC5A0ACBD7882CB6767" indent="up1"><enum>(i)</enum><text>The services are provided by a
contractor, volunteer practitioner (as defined in subsection (k)(4)(B)), or
employee of the entity who is a physician or other licensed or certified health
care practitioner and who is otherwise deemed to be an employee for purposes of
paragraph (1)(A) when providing services with respect to the entity.</text>
</clause><clause id="HE843AC91E15240CB9D46E30218AB8D77" indent="up1"><enum>(ii)</enum><text>The services are provided in an
emergency area (as defined in subparagraph (D)), with respect to a public
health emergency or major disaster described in subparagraph (D), and during
the period for which such emergency or disaster is determined or declared,
respectively.</text>
</clause><clause id="H5665331617A940A2B0955DBB0362A055" indent="up1"><enum>(iii)</enum><text>The services of the contractor,
volunteer practitioner, or employee (referred to in this paragraph as the
<quote>out-of-area practitioner</quote>) are provided under an arrangement
with—</text>
<subclause id="H34743DC8AA964FE5A8C8CA3D2600B62B"><enum>(I)</enum><text>an entity that is deemed to be an
employee for purposes of paragraph (1)(A) and that serves the emergency area
involved (referred to in this paragraph as an <quote>emergency-area
entity</quote>); or</text>
</subclause><subclause id="H90B6CB86291841E4980E74CE0C9557FD"><enum>(II)</enum><text>a Federal agency that has
responsibilities regarding the provision of health services in such area during
the emergency.</text>
</subclause></clause><clause id="HF79F787A6A874AC4B6F095D87D251445" indent="up1"><enum>(iv)</enum><text>The purposes of the arrangement
are—</text>
<subclause id="HA9D6379DB2384EA78CC804B350CB30C4"><enum>(I)</enum><text>to coordinate, to the extent
practicable, the provision of health services in the emergency area by the
out-of-area practitioner with the provision of services by the emergency-area
entity, or by the Federal agency, as the case may be;</text>
</subclause><subclause id="H1368CE7D8B9A4586BF44048B41B36087"><enum>(II)</enum><text>to identify a location in the
emergency area to which such practitioner should report for purposes of
providing health services, and to identify an individual or individuals in the
area to whom the practitioner should report for such purposes; and</text>
</subclause><subclause id="H54A1E1289B744EB09282678DBFC037CA"><enum>(III)</enum><text>to verify the identity of the
practitioner and that the practitioner is licensed or certified by one or more
of the States.</text>
</subclause></clause><clause id="H1C2320E26BB143609881DDC85B21F579" indent="up1"><enum>(v)</enum><text>With respect to the licensure or
certification of health care practitioners, the provision of services by the
out-of-area practitioner in the emergency area is not a violation of the law of
the State in which the area is located.</text>
</clause></subparagraph><subparagraph id="HAC4AFC86D84B4CC08B65BBA13BE6FBAC" indent="up1"><enum>(B)</enum><text>In issuing criteria under
subparagraph (A), the Secretary shall take into account the need to rapidly
enter into arrangements under such subparagraph in order to provide health
services in emergency areas promptly after the emergency begins.</text>
</subparagraph><subparagraph id="H528175B2C919412AB70C8945BC739976" indent="up1"><enum>(C)</enum><text>Subparagraph (A) applies with respect
to an act or omission of an out-of-area practitioner only to the extent that
the practitioner is not immune from liability for such act or omission under
the Volunteer Protection Act of 1997.</text>
</subparagraph><subparagraph id="HF02709937F2446FAB2B5A3211A2801DA" indent="up1"><enum>(D)</enum><text>For purposes of this paragraph, the
term <term>emergency area</term> means a geographic area for which—</text>
<clause id="HE38351E979EC4124A17249AFC40E8EA4"><enum>(i)</enum><text>the Secretary has made a determination
under section 319 that a public health emergency exists; or</text>
</clause><clause id="H770147EFA0AD4FE69803D7468784750D"><enum>(ii)</enum><text>a presidential declaration of major
disaster has been issued under section 401 of the Robert T. Stafford Disaster
Relief and Emergency Assistance
Act.</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><enum>V</enum><header>Medical Liability
and Uncompensated Care Reforms</header>
<section id="H23604EC5C6CD406F9B6C41EFB991A2A1"><enum>501.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote><short-title>Help Efficient, Accessible,
Low-cost, Timely Healthcare (HEALTH) Act of 2009</short-title></quote>.</text>
</section><section id="H1BAF6ABFBA534BDEA28F93BA47909AD4"><enum>502.</enum><header>Findings and
purpose</header>
<subsection id="H2C97901F090A4596A22A5ECCBDE5E03A"><enum>(a)</enum><header>Findings</header>
<paragraph id="HC55C6CA341F14F7AA3E660D76FD29F95"><enum>(1)</enum><header>Effect on health
care access and costs</header><text>Congress finds that our current civil
justice system is adversely affecting patient access to health care services,
better patient care, and cost-efficient health care, in that the health care
liability system is a costly and ineffective mechanism for resolving claims of
health care liability and compensating injured patients, and is a deterrent to
the sharing of information among health care professionals which impedes
efforts to improve patient safety and quality of care.</text>
</paragraph><paragraph id="H1BFF4970BB8C46BEBB9B7EB856DDE889"><enum>(2)</enum><header>Effect on
interstate commerce</header><text>Congress finds that the health care and
insurance industries are industries affecting interstate commerce and the
health care liability litigation systems existing throughout the United States
are activities that affect interstate commerce by contributing to the high
costs of health care and premiums for health care liability insurance purchased
by health care system providers.</text>
</paragraph><paragraph id="H49CCF7160A3B43219CDC17779DB760DA"><enum>(3)</enum><header>Effect on
federal spending</header><text>Congress finds that the health care liability
litigation systems existing throughout the United States have a significant
effect on the amount, distribution, and use of Federal funds because of—</text>
<subparagraph id="HE7044E1102D74C0CA4EE6C3266B84E30"><enum>(A)</enum><text>the large number
of individuals who receive health care benefits under programs operated or
financed by the Federal Government;</text>
</subparagraph><subparagraph id="H23C4CB9DD6594A73B60CB1C5C52EAC34"><enum>(B)</enum><text>the large number
of individuals who benefit because of the exclusion from Federal taxes of the
amounts spent to provide them with health insurance benefits; and</text>
</subparagraph><subparagraph id="H7F69F96BA0C94138A0F7B5D164E1AA3D"><enum>(C)</enum><text>the large number
of health care providers who provide items or services for which the Federal
Government makes payments.</text>
</subparagraph></paragraph></subsection><subsection id="HED737018C217402C9B4E582C151268F0"><enum>(b)</enum><header>Purpose</header><text>It
is the purpose of this title to implement reasonable, comprehensive, and
effective health care liability reforms designed to—</text>
<paragraph id="HA54F654AEA534C0AB6D69FF52240DDF6"><enum>(1)</enum><text>improve the
availability of health care services in cases in which health care liability
actions have been shown to be a factor in the decreased availability of
services;</text>
</paragraph><paragraph id="H3024C178485547C6B248563BBFDD2086"><enum>(2)</enum><text>reduce the
incidence of <quote>defensive medicine</quote> and lower the cost of health
care liability insurance, all of which contribute to the escalation of health
care costs;</text>
</paragraph><paragraph id="HF5B24D8F10674591ABC74012BD7D5A12"><enum>(3)</enum><text>ensure that
persons with meritorious health care injury claims receive fair and adequate
compensation, including reasonable noneconomic damages;</text>
</paragraph><paragraph id="H549863720187452F89DF3E4A3A70965A"><enum>(4)</enum><text>improve the
fairness and cost-effectiveness of our current health care liability system to
resolve disputes over, and provide compensation for, health care liability by
reducing uncertainty in the amount of compensation provided to injured
individuals; and</text>
</paragraph><paragraph id="HADAB8EE2F87C40C792C5488EB26944CF"><enum>(5)</enum><text>provide an
increased sharing of information in the health care system which will reduce
unintended injury and improve patient care.</text>
</paragraph></subsection></section><section id="H75B9C380049D44119BD5EF2137F4C543"><enum>503.</enum><header>Encouraging
speedy resolution of claims</header><text display-inline="no-display-inline">The time for the commencement of a health
care lawsuit shall be 3 years after the date of manifestation of injury or 1
year after the claimant discovers, or through the use of reasonable diligence
should have discovered, the injury, whichever occurs first. In no event shall
the time for commencement of a health care lawsuit exceed 3 years after the
date of manifestation of injury unless tolled for any of the following—</text>
<paragraph id="H8564EDD420534A7484C61AC93E5D88AB"><enum>(1)</enum><text>upon proof of
fraud;</text>
</paragraph><paragraph id="H9266143FC0DB46A8B15510F9BB654A85"><enum>(2)</enum><text>intentional
concealment; or</text>
</paragraph><paragraph id="H4C0AF4148AE14CBBA4228E89A2562A7C"><enum>(3)</enum><text>the presence of a
foreign body, which has no therapeutic or diagnostic purpose or effect, in the
person of the injured person. Actions by a minor shall be commenced within 3
years from the date of the alleged manifestation of injury except that actions
by a minor under the full age of 6 years shall be commenced within 3 years of
manifestation of injury or prior to the minor’s 8th birthday, whichever
provides a longer period. Such time limitation shall be tolled for minors for
any period during which a parent or guardian and a health care provider or
health care organization have committed fraud or collusion in the failure to
bring an action on behalf of the injured minor.</text>
</paragraph></section><section id="H9B6A43E26281431A9D62E6386E333C72"><enum>504.</enum><header>Compensating
patient injury</header>
<subsection id="H1B7E5B67767A4979A3E1B62E20B92F3F"><enum>(a)</enum><header>Unlimited Amount
of Damages for Actual Economic Losses in Health Care Lawsuits</header><text>In
any health care lawsuit, nothing in this title shall limit a claimant’s
recovery of the full amount of the available economic damages, notwithstanding
the limitation in subsection (b).</text>
</subsection><subsection id="HFD3371C8CF2E4301B98E2537748C715F"><enum>(b)</enum><header>Additional
Noneconomic Damages</header><text>In any health care lawsuit, the amount of
noneconomic damages, if available, may be as much as $250,000, regardless of
the number of parties against whom the action is brought or the number of
separate claims or actions brought with respect to the same injury.</text>
</subsection><subsection id="H16E4AD34208848DEAF18F7DA3D605C93"><enum>(c)</enum><header>No Discount of
Award for Noneconomic Damages</header><text>For purposes of applying the
limitation in subsection (b), future noneconomic damages shall not be
discounted to present value. The jury shall not be informed about the maximum
award for noneconomic damages. An award for noneconomic damages in excess of
$250,000 shall be reduced either before the entry of judgment, or by amendment
of the judgment after entry of judgment, and such reduction shall be made
before accounting for any other reduction in damages required by law. If
separate awards are rendered for past and future noneconomic damages and the
combined awards exceed $250,000, the future noneconomic damages shall be
reduced first.</text>
</subsection><subsection id="HBFFECD2EE6744C21959BA5FA8991AAD2"><enum>(d)</enum><header>Fair Share
Rule</header><text>In any health care lawsuit, each party shall be liable for
that party’s several share of any damages only and not for the share of any
other person. Each party shall be liable only for the amount of damages
allocated to such party in direct proportion to such party’s percentage of
responsibility. Whenever a judgment of liability is rendered as to any party, a
separate judgment shall be rendered against each such party for the amount
allocated to such party. For purposes of this section, the trier of fact shall
determine the proportion of responsibility of each party for the claimant’s
harm.</text>
</subsection></section><section id="H65FE48589E4C436888DC30A459DE980D"><enum>505.</enum><header>Maximizing
patient recovery</header>
<subsection id="H8CA4DCABF5A3410A95AC5D26C93DA02A"><enum>(a)</enum><header>Court
Supervision of Share of Damages Actually Paid to Claimants</header><text>In any
health care lawsuit, the court shall supervise the arrangements for payment of
damages to protect against conflicts of interest that may have the effect of
reducing the amount of damages awarded that are actually paid to claimants. In
particular, in any health care lawsuit in which the attorney for a party claims
a financial stake in the outcome by virtue of a contingent fee, the court shall
have the power to restrict the payment of a claimant’s damage recovery to such
attorney, and to redirect such damages to the claimant based upon the interests
of justice and principles of equity. In no event shall the total of all
contingent fees for representing all claimants in a health care lawsuit exceed
the following limits:</text>
<paragraph id="H168080A84952407A859603FC459FAD4A"><enum>(1)</enum><text>40 percent of the
first $50,000 recovered by the claimant(s).</text>
</paragraph><paragraph id="H000BDF04073C4973867AF6BEAB045544"><enum>(2)</enum><text>33<fraction>1/3</fraction>
percent of the next $50,000 recovered by the claimant(s).</text>
</paragraph><paragraph id="H86E98219CE5F45FCB7CF6D3513F60CE0"><enum>(3)</enum><text>25 percent of the
next $500,000 recovered by the claimant(s).</text>
</paragraph><paragraph id="HFE1D609A8F6843D5BE0A6719B6C2DF99"><enum>(4)</enum><text>15 percent of any
amount by which the recovery by the claimant(s) is in excess of
$600,000.</text>
</paragraph></subsection><subsection id="H78A4F2013B3A46569DE3B864642FBA95"><enum>(b)</enum><header>Applicability</header><text>The
limitations in this section shall apply whether the recovery is by judgment,
settlement, mediation, arbitration, or any other form of alternative dispute
resolution. In a health care lawsuit involving a minor or incompetent person, a
court retains the authority to authorize or approve a fee that is less than the
maximum permitted under this section. The requirement for court supervision in
the first two sentences of subsection (a) applies only in civil actions.</text>
</subsection></section><section id="H45198B8C390941798925E7E0E9C61F43"><enum>506.</enum><header>Additional
health benefits</header><text display-inline="no-display-inline">In any health
care lawsuit involving injury or wrongful death, any party may introduce
evidence of collateral source benefits. If a party elects to introduce such
evidence, any opposing party may introduce evidence of any amount paid or
contributed or reasonably likely to be paid or contributed in the future by or
on behalf of the opposing party to secure the right to such collateral source
benefits. No provider of collateral source benefits shall recover any amount
against the claimant or receive any lien or credit against the claimant’s
recovery or be equitably or legally subrogated to the right of the claimant in
a health care lawsuit involving injury or wrongful death. This section shall
apply to any health care lawsuit that is settled as well as a health care
lawsuit that is resolved by a fact finder. This section shall not apply to
section 1862(b) (42 U.S.C. 1395y(b)) or section 1902(a)(25) (42 U.S.C.
1396a(a)(25)) of the Social Security Act.</text>
</section><section id="H83194D3442E04E0C9410AB56F663453B"><enum>507.</enum><header>Punitive
damages</header>
<subsection id="H0A1642291DBD45FE9946A912B07234C8"><enum>(a)</enum><header>In
general</header><text>Punitive damages may, if otherwise permitted by
applicable State or Federal law, be awarded against any person in a health care
lawsuit only if it is proven by clear and convincing evidence that such person
acted with malicious intent to injure the claimant, or that such person
deliberately failed to avoid unnecessary injury that such person knew the
claimant was substantially certain to suffer. In any health care lawsuit where
no judgment for compensatory damages is rendered against such person, no
punitive damages may be awarded with respect to the claim in such lawsuit. No
demand for punitive damages shall be included in a health care lawsuit as
initially filed. A court may allow a claimant to file an amended pleading for
punitive damages only upon a motion by the claimant and after a finding by the
court, upon review of supporting and opposing affidavits or after a hearing,
after weighing the evidence, that the claimant has established by a substantial
probability that the claimant will prevail on the claim for punitive damages.
At the request of any party in a health care lawsuit, the trier of fact shall
consider in a separate proceeding—</text>
<paragraph id="HD56715A92B334750918AA5A9ACC36CC2"><enum>(1)</enum><text>whether punitive
damages are to be awarded and the amount of such award; and</text>
</paragraph><paragraph id="HF332C347E7CF4260BB8091B03F4266B3"><enum>(2)</enum><text>the amount of
punitive damages following a determination of punitive liability.</text>
</paragraph><continuation-text continuation-text-level="subsection">If a
separate proceeding is requested, evidence relevant only to the claim for
punitive damages, as determined by applicable State law, shall be inadmissible
in any proceeding to determine whether compensatory damages are to be
awarded.</continuation-text></subsection><subsection id="HF3984D3145AF4FEFA8F687A5A913090A"><enum>(b)</enum><header>Determining
Amount of Punitive Damages</header>
<paragraph id="HA4FCB48150F94666B556A81862F58530"><enum>(1)</enum><header>Factors
considered</header><text>In determining the amount of punitive damages, if
awarded, in a health care lawsuit, the trier of fact shall consider only the
following—</text>
<subparagraph id="HD8324DD40D98467E84F6F18040DDBA74"><enum>(A)</enum><text>the severity of
the harm caused by the conduct of such party;</text>
</subparagraph><subparagraph id="HA98ABCB6AAA94B07817624460C26007E"><enum>(B)</enum><text>the duration of
the conduct or any concealment of it by such party;</text>
</subparagraph><subparagraph id="H56988C2F621E4BF8B8740056DE0E504A"><enum>(C)</enum><text>the profitability
of the conduct to such party;</text>
</subparagraph><subparagraph id="HAC5F46C074234A639159600967EF4019"><enum>(D)</enum><text>the number of
products sold or medical procedures rendered for compensation, as the case may
be, by such party, of the kind causing the harm complained of by the
claimant;</text>
</subparagraph><subparagraph id="H5AEEDFFA9ADD46DEBAFE5D2553AF2DE3"><enum>(E)</enum><text>any criminal
penalties imposed on such party, as a result of the conduct complained of by
the claimant; and</text>
</subparagraph><subparagraph id="H74B1A6B7F08D4FBBB54BD51E9A62B107"><enum>(F)</enum><text>the amount of any
civil fines assessed against such party as a result of the conduct complained
of by the claimant.</text>
</subparagraph></paragraph><paragraph id="H45599CAAFA5F4667A0C457D8226B261B"><enum>(2)</enum><header>Maximum
award</header><text>The amount of punitive damages, if awarded, in a health
care lawsuit may be as much as $250,000 or as much as two times the amount of
economic damages awarded, whichever is greater. The jury shall not be informed
of this limitation.</text>
</paragraph></subsection><subsection id="HD16A51515B644CD6A8EE23232E0C538E"><enum>(c)</enum><header>No Punitive
Damages for Products That Comply With FDA Standards</header>
<paragraph id="H6C0765DE611245E197506B5A5681B122"><enum>(1)</enum><header>In
general</header>
<subparagraph id="H8A9813469A4A4694A7ED4C013F6F64DA"><enum>(A)</enum><text>No punitive
damages may be awarded against the manufacturer or distributor of a medical
product, or a supplier of any component or raw material of such medical
product, based on a claim that such product caused the claimant’s harm
where—</text>
<clause id="H66F2F00B74354949B1A253990269F643"><enum>(i)</enum><subclause commented="no" display-inline="yes-display-inline" id="H8895274ECC0049CDA5BEC6EE379F4E14"><enum>(I)</enum><text>such medical product was
subject to premarket approval, clearance, or licensure by the Food and Drug
Administration with respect to the safety of the formulation or performance of
the aspect of such medical product which caused the claimant’s harm or the
adequacy of the packaging or labeling of such medical product; and</text>
</subclause><subclause id="HA7E8A825C0464DDFBA2A182683159748" indent="up1"><enum>(II)</enum><text>such medical product was so approved,
cleared, or licensed; or</text>
</subclause></clause><clause id="H85106FE640824389A1F75CF431350E5C"><enum>(ii)</enum><text>such medical
product is generally recognized among qualified experts as safe and effective
pursuant to conditions established by the Food and Drug Administration and
applicable Food and Drug Administration regulations, including without
limitation those related to packaging and labeling, unless the Food and Drug
Administration has determined that such medical product was not manufactured or
distributed in substantial compliance with applicable Food and Drug
Administration statutes and regulations.</text>
</clause></subparagraph><subparagraph id="H76915EFBA9C94639985BD691020EF8FA"><enum>(B)</enum><header>Rule of
construction</header><text>Subparagraph (A) may not be construed as
establishing the obligation of the Food and Drug Administration to demonstrate
affirmatively that a manufacturer, distributor, or supplier referred to in such
subparagraph meets any of the conditions described in such subparagraph.</text>
</subparagraph></paragraph><paragraph id="H8EC51BC4973242A39959336425BF7D43"><enum>(2)</enum><header>Liability of
health care providers</header><text>A health care provider who prescribes, or
who dispenses pursuant to a prescription, a medical product approved, licensed,
or cleared by the Food and Drug Administration shall not be named as a party to
a product liability lawsuit involving such product and shall not be liable to a
claimant in a class action lawsuit against the manufacturer, distributor, or
seller of such product. Nothing in this paragraph prevents a court from
consolidating cases involving health care providers and cases involving
products liability claims against the manufacturer, distributor, or product
seller of such medical product.</text>
</paragraph><paragraph id="H01C03F0461A74861B3A1BE1F55A889FD"><enum>(3)</enum><header>Packaging</header><text>In
a health care lawsuit for harm which is alleged to relate to the adequacy of
the packaging or labeling of a drug which is required to have tamper-resistant
packaging under regulations of the Secretary of Health and Human Services
(including labeling regulations related to such packaging), the manufacturer or
product seller of the drug shall not be held liable for punitive damages unless
such packaging or labeling is found by the trier of fact by clear and
convincing evidence to be substantially out of compliance with such
regulations.</text>
</paragraph><paragraph id="HE3988F911AA84653828EACDAE4C82DB7"><enum>(4)</enum><header>Exception</header><text>Paragraph
(1) shall not apply in any health care lawsuit in which—</text>
<subparagraph id="H91BFEB49FC824F678EA245CCED346694"><enum>(A)</enum><text>a person, before
or after premarket approval, clearance, or licensure of such medical product,
knowingly misrepresented to or withheld from the Food and Drug Administration
information that is required to be submitted under the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 301 et seq.) or section 351 of the Public Health
Service Act (42 U.S.C. 262) that is material and is causally related to the
harm which the claimant allegedly suffered; or</text>
</subparagraph><subparagraph id="H012AC12CD18C4D45AC4FE2F8147CBECF"><enum>(B)</enum><text>a person made an
illegal payment to an official of the Food and Drug Administration for the
purpose of either securing or maintaining approval, clearance, or licensure of
such medical product.</text>
</subparagraph></paragraph></subsection></section><section id="H9587A3BFA61548199EE4A5AD3A82BE5C"><enum>508.</enum><header>Authorization
of payment of future damages to claimants in health care lawsuits</header>
<subsection id="HF92A14F48E494070B08DEEAADB054B01"><enum>(a)</enum><header>In
general</header><text>In any health care lawsuit, if an award of future
damages, without reduction to present value, equaling or exceeding $50,000 is
made against a party with sufficient insurance or other assets to fund a
periodic payment of such a judgment, the court shall, at the request of any
party, enter a judgment ordering that the future damages be paid by periodic
payments. In any health care lawsuit, the court may be guided by the Uniform
Periodic Payment of Judgments Act promulgated by the National Conference of
Commissioners on Uniform State Laws.</text>
</subsection><subsection id="HB6092B8B4A94404F95CB3F285E657A35"><enum>(b)</enum><header>Applicability</header><text>This
section applies to all actions which have not been first set for trial or
retrial before the effective date of this title.</text>
</subsection></section><section id="H344546C915224D87A22F5D978BD60B70"><enum>509.</enum><header>Definitions</header><text display-inline="no-display-inline">In this title:</text>
<paragraph id="H4028F761E7B246BEBA18D693BE1B480D"><enum>(1)</enum><header>Alternative
dispute resolution system; adr</header><text>The term <term>alternative dispute
resolution system</term> or <term>ADR</term> means a system that provides for
the resolution of health care lawsuits in a manner other than through a civil
action brought in a State or Federal court.</text>
</paragraph><paragraph id="HFC581EFDD4B643F0829A5C680EF259B1"><enum>(2)</enum><header>Claimant</header><text>The
term <term>claimant</term> means any person who brings a health care lawsuit,
including a person who asserts or claims a right to legal or equitable
contribution, indemnity or subrogation, arising out of a health care liability
claim or action, and any person on whose behalf such a claim is asserted or
such an action is brought, whether deceased, incompetent, or a minor.</text>
</paragraph><paragraph id="H0AD70D12001A450EB46202D16B333472"><enum>(3)</enum><header>Collateral
source benefits</header><text>The term <term>collateral source benefits</term>
means any amount paid or reasonably likely to be paid in the future to or on
behalf of the claimant, or any service, product or other benefit provided or
reasonably likely to be provided in the future to or on behalf of the claimant,
as a result of the injury or wrongful death, pursuant to—</text>
<subparagraph id="HEC302C54C6824CA3AE948356C5C000B5"><enum>(A)</enum><text>any State or
Federal health, sickness, income-disability, accident, or workers’ compensation
law;</text>
</subparagraph><subparagraph id="H5F1E7240E31C4903925D8AC28A478696"><enum>(B)</enum><text>any health,
sickness, income-disability, or accident insurance that provides health
benefits or income-disability coverage;</text>
</subparagraph><subparagraph id="H78764F129D7F4770B246F5ED50447C6C"><enum>(C)</enum><text>any contract or
agreement of any group, organization, partnership, or corporation to provide,
pay for, or reimburse the cost of medical, hospital, dental, or income
disability benefits; and</text>
</subparagraph><subparagraph id="HE46E78E11AF6438DBD29EDEC371EA6DD"><enum>(D)</enum><text>any other publicly
or privately funded program.</text>
</subparagraph></paragraph><paragraph id="H195BEF6917B340BE8480D5610F115993"><enum>(4)</enum><header>Compensatory
damages</header><text>The term <term>compensatory damages</term> means
objectively verifiable monetary losses incurred as a result of the provision
of, use of, or payment for (or failure to provide, use, or pay for) health care
services or medical products, such as past and future medical expenses, loss of
past and future earnings, cost of obtaining domestic services, loss of
employment, and loss of business or employment opportunities, damages for
physical and emotional pain, suffering, inconvenience, physical impairment,
mental anguish, disfigurement, loss of enjoyment of life, loss of society and
companionship, loss of consortium (other than loss of domestic service),
hedonic damages, injury to reputation, and all other nonpecuniary losses of any
kind or nature. The term <term>compensatory damages</term> includes economic
damages and noneconomic damages, as such terms are defined in this
section.</text>
</paragraph><paragraph id="H83312682E0C8465FB5DAD48E09286AEC"><enum>(5)</enum><header>Contingent
fee</header><text>The term <term>contingent fee</term> includes all
compensation to any person or persons which is payable only if a recovery is
effected on behalf of one or more claimants.</text>
</paragraph><paragraph id="HBC0321429B4A4CE2A96C487F422DAA28"><enum>(6)</enum><header>Economic
damages</header><text>The term <term>economic damages</term> means objectively
verifiable monetary losses incurred as a result of the provision of, use of, or
payment for (or failure to provide, use, or pay for) health care services or
medical products, such as past and future medical expenses, loss of past and
future earnings, cost of obtaining domestic services, loss of employment, and
loss of business or employment opportunities.</text>
</paragraph><paragraph id="H721060E4D98A42CC9CF0B505C6B8F010"><enum>(7)</enum><header>Health care
lawsuit</header><text>The term <term>health care lawsuit</term> means any
health care liability claim concerning the provision of health care goods or
services or any medical product affecting interstate commerce, or any health
care liability action concerning the provision of health care goods or services
or any medical product affecting interstate commerce, brought in a State or
Federal court or pursuant to an alternative dispute resolution system, against
a health care provider, a health care organization, or the manufacturer,
distributor, supplier, marketer, promoter, or seller of a medical product,
regardless of the theory of liability on which the claim is based, or the
number of claimants, plaintiffs, defendants, or other parties, or the number of
claims or causes of action, in which the claimant alleges a health care
liability claim. Such term does not include a claim or action which is based on
criminal liability; which seeks civil fines or penalties paid to Federal,
State, or local government; or which is grounded in antitrust.</text>
</paragraph><paragraph id="H4607732219E54DDE88E57A1D89D6B348"><enum>(8)</enum><header>Health care
liability action</header><text>The term <term>health care liability
action</term> means a civil action brought in a State or Federal Court or
pursuant to an alternative dispute resolution system, against a health care
provider, a health care organization, or the manufacturer, distributor,
supplier, marketer, promoter, or seller of a medical product, regardless of the
theory of liability on which the claim is based, or the number of plaintiffs,
defendants, or other parties, or the number of causes of action, in which the
claimant alleges a health care liability claim.</text>
</paragraph><paragraph id="HAB86032C26054CF386D4D66DDAD3F533"><enum>(9)</enum><header>Health care
liability claim</header><text>The term <term>health care liability claim</term>
means a demand by any person, whether or not pursuant to ADR, against a health
care provider, health care organization, or the manufacturer, distributor,
supplier, marketer, promoter, or seller of a medical product, including, but
not limited to, third-party claims, cross-claims, counter-claims, or
contribution claims, which are based upon the provision of, use of, or payment
for (or the failure to provide, use, or pay for) health care services or
medical products, regardless of the theory of liability on which the claim is
based, or the number of plaintiffs, defendants, or other parties, or the number
of causes of action.</text>
</paragraph><paragraph id="H5B0F8566859745DA80FE5AB9B06B483D"><enum>(10)</enum><header>Health care
organization</header><text>The term <term>health care organization</term> means
any person or entity which is obligated to provide or pay for health benefits
under any health plan, including any person or entity acting under a contract
or arrangement with a health care organization to provide or administer any
health benefit.</text>
</paragraph><paragraph id="H993F2B34B6604D94BDD7A95DC3C1A6DD"><enum>(11)</enum><header>Health care
provider</header><text>The term <term>health care provider</term> means any
person or entity required by State or Federal laws or regulations to be
licensed, registered, or certified to provide health care services, and being
either so licensed, registered, or certified, or exempted from such requirement
by other statute or regulation.</text>
</paragraph><paragraph id="H865B428AFE604AA1AF876DBE1C972E80"><enum>(12)</enum><header>Health care
goods or services</header><text>The term <term>health care goods or
services</term> means any goods or services provided by a health care
organization, provider, or by any individual working under the supervision of a
health care provider, that relates to the diagnosis, prevention, or treatment
of any human disease or impairment, or the assessment or care of the health of
human beings.</text>
</paragraph><paragraph id="H762D01C75B8E4EF1B932471DFFA07144"><enum>(13)</enum><header>Malicious
intent to injure</header><text>The term <term>malicious intent to injure</term>
means intentionally causing or attempting to cause physical injury other than
providing health care goods or services.</text>
</paragraph><paragraph id="H3849AF780F4949D2933DBE530F4A321B"><enum>(14)</enum><header>Medical
product</header><text>The term <term>medical product</term> means a drug,
device, or biological product intended for humans, and the terms
<term>drug</term>, <term>device</term>, and <term>biological product</term>
have the meanings given such terms in sections 201(g)(1) and 201(h) of the
Federal Food, Drug and Cosmetic Act (21 U.S.C. 321) and section 351(a) of the
Public Health Service Act (42 U.S.C. 262(a)), respectively, including any
component or raw material used therein, but excluding health care
services.</text>
</paragraph><paragraph id="HBA869F6B5AA64E589745DE01DDA06B41"><enum>(15)</enum><header>Noneconomic
damages</header><text>The term <term>noneconomic damages</term> means damages
for physical and emotional pain, suffering, inconvenience, physical impairment,
mental anguish, disfigurement, loss of enjoyment of life, loss of society and
companionship, loss of consortium (other than loss of domestic service),
hedonic damages, injury to reputation, and all other nonpecuniary losses of any
kind or nature.</text>
</paragraph><paragraph id="H93E6C4E851F743DDA7633BD1D737F8D5"><enum>(16)</enum><header>Punitive
damages</header><text>The term <term>punitive damages</term> means damages
awarded, for the purpose of punishment or deterrence, and not solely for
compensatory purposes, against a health care provider, health care
organization, or a manufacturer, distributor, or supplier of a medical product.
Punitive damages are neither economic nor noneconomic damages.</text>
</paragraph><paragraph id="H1F5B77D47AEB4B7C833CFFFCC3A9C2EC"><enum>(17)</enum><header>Recovery</header><text>The
term <term>recovery</term> means the net sum recovered after deducting any
disbursements or costs incurred in connection with prosecution or settlement of
the claim, including all costs paid or advanced by any person. Costs of health
care incurred by the plaintiff and the attorneys' office overhead costs or
charges for legal services are not deductible disbursements or costs for such
purpose.</text>
</paragraph><paragraph id="HD281446420134AF5838B69E9E778139E"><enum>(18)</enum><header>State</header><text>The
term <term>State</term> means each of the several States, the District of
Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, Guam, American
Samoa, the Northern Mariana Islands, the Trust Territory of the Pacific
Islands, and any other territory or possession of the United States, or any
political subdivision thereof.</text>
</paragraph></section><section id="H8C1BF3F1DBE344BA93180B74EEFBB894"><enum>510.</enum><header>Effect on other
laws</header>
<subsection id="H18B3E093E4264D07B2B0F29D502038A2"><enum>(a)</enum><header>Vaccine
Injury</header>
<paragraph id="H5B1E5C3FB6A64BC1B6557C3F81891B6A"><enum>(1)</enum><text>To the extent that
title XXI of the Public Health Service Act establishes a Federal rule of law
applicable to a civil action brought for a vaccine-related injury or
death—</text>
<subparagraph id="H5AD4A6972EDC4CD9A0AFD97A35D44636"><enum>(A)</enum><text>this title does
not affect the application of the rule of law to such an action; and</text>
</subparagraph><subparagraph id="HCDB141F178C04E559968B3AAD85106E8"><enum>(B)</enum><text>any rule of law
prescribed by this title in conflict with a rule of law of such title XXI shall
not apply to such action.</text>
</subparagraph></paragraph><paragraph id="H5A66BDF1DEC544BD8D79B31A65F9A1A4"><enum>(2)</enum><text>If there is an
aspect of a civil action brought for a vaccine-related injury or death to which
a Federal rule of law under title XXI of the Public Health Service Act does not
apply, then this title or otherwise applicable law (as determined under this
title) will apply to such aspect of such action.</text>
</paragraph></subsection><subsection id="H735B24D511A04DBB9AEE49DB4F87F0A0"><enum>(b)</enum><header>Other Federal
Law</header><text>Except as provided in this section, nothing in this title
shall be deemed to affect any defense available to a defendant in a health care
lawsuit or action under any other provision of Federal law.</text>
</subsection></section><section id="H12397DE9192143AEA0F602F71FB0BEFA"><enum>511.</enum><header>State
flexibility and protection of states’ rights</header>
<subsection id="H3A133908086A409AB55426810AC92B35"><enum>(a)</enum><header>Health Care
Lawsuits</header><text>The provisions governing health care lawsuits set forth
in this title preempt, subject to subsections (b) and (c), State law to the
extent that State law prevents the application of any provisions of law
established by or under this title. The provisions governing health care
lawsuits set forth in this title supersede chapter 171 of title 28, United
States Code, to the extent that such chapter—</text>
<paragraph id="HC6F1408825644A5CA5818B974C893114"><enum>(1)</enum><text>provides for a
greater amount of damages or contingent fees, a longer period in which a health
care lawsuit may be commenced, or a reduced applicability or scope of periodic
payment of future damages, than provided in this title; or</text>
</paragraph><paragraph id="HCC9E333C8D3E4F339393E8FFA6019A0F"><enum>(2)</enum><text>prohibits the
introduction of evidence regarding collateral source benefits, or mandates or
permits subrogation or a lien on collateral source benefits.</text>
</paragraph></subsection><subsection id="H97B7F56FD9E14F08B8B80E5E9766F73F"><enum>(b)</enum><header>Protection of
States’ Rights and Other Laws</header><paragraph commented="no" display-inline="yes-display-inline" id="H7A8F51B2B2024529A6120CE050C7134E"><enum>(1)</enum><text>Any issue that is not
governed by any provision of law established by or under this title (including
State standards of gross negligence) shall be governed by otherwise applicable
State or Federal law.</text>
</paragraph><paragraph id="H0E04DDA51C994B5AB3C6C1D4962FDB15" indent="up1"><enum>(2)</enum><text>This title shall not preempt or
supersede any State or Federal law that imposes greater procedural or
substantive protections for health care providers and health care organizations
from liability, loss, or damages than those provided by this title or create a
cause of action.</text>
</paragraph></subsection><subsection id="HC01383C17E734ABD8CF75920E3002EC6"><enum>(c)</enum><header>State
Flexibility</header><text>No provision of this title shall be construed to
preempt—</text>
<paragraph id="H8CE8CDCC9FFB444FB028C58E5638B713"><enum>(1)</enum><text>any State law
(whether effective before, on, or after the date of the enactment of this
title) that specifies a particular monetary amount of compensatory or punitive
damages (or the total amount of damages) that may be awarded in a health care
lawsuit, regardless of whether such monetary amount is greater or lesser than
is provided for under this title, notwithstanding section 404(a); or</text>
</paragraph><paragraph id="H2AFFC399A2D44A72BBA749B977D2941F"><enum>(2)</enum><text>any defense
available to a party in a health care lawsuit under any other provision of
State or Federal law.</text>
</paragraph></subsection></section><section id="H8CCF7667BC3C4FD683DD781E456D1FB0"><enum>512.</enum><header>Applicability;
effective date</header><text display-inline="no-display-inline">The previous
provisions of this title shall apply to any health care lawsuit brought in a
Federal or State court, or subject to an alternative dispute resolution system,
that is initiated on or after the date of the enactment of this title, except
that any health care lawsuit arising from an injury occurring prior to the date
of the enactment of this title shall be governed by the applicable statute of
limitations provisions in effect at the time the injury occurred.</text>
</section><section id="HE7970BCDAF96411DA89C8B93F1125AB2"><enum>513.</enum><header>Sense of
Congress</header><text display-inline="no-display-inline">It is the sense of
Congress that a health insurer should be liable for damages for harm caused
when it makes a decision as to what care is medically necessary and
appropriate.</text>
</section><section display-inline="no-display-inline" id="H9D54B8A0D41840AFA29512681FCEE6D7"><enum>514.</enum><header>State grants to
create administrative health care tribunals</header><text display-inline="no-display-inline">Part P of title III of the Public Health
Service Act (42 U.S.C. 280g et seq.) is amended by adding at the end the
following:</text>
<quoted-block display-inline="no-display-inline" id="H890B91F03DEA4442BD3930E6B10375E3" style="OLC">
<section id="HD1E23DCCD2C54CEBB0A354FE0D96B209"><enum>399T.</enum><header>State grants
to create administrative health care tribunals</header>
<subsection id="HE7850B4745054D8CB791D2958413FA1C"><enum>(a)</enum><header>In
general</header><text>The Secretary may award grants to States for the
development, implementation, and evaluation of administrative health care
tribunals that comply with this section, for the resolution of disputes
concerning injuries allegedly caused by health care providers.</text>
</subsection><subsection id="HE7A69EB4D21D415C98EDE9609034051E"><enum>(b)</enum><header>Conditions for
demonstration grants</header><text>To be eligible to receive a grant under this
section, a State shall submit to the Secretary an application at such time, in
such manner, and containing such information as may be required by the
Secretary. A grant shall be awarded under this section on such terms and
conditions as the Secretary determines appropriate.</text>
</subsection><subsection id="HBCF1029195204093AB7EFFF769F311FD"><enum>(c)</enum><header>Representation
by counsel</header><text>A State that receives a grant under this section may
not preclude any party to a dispute before an administrative health care
tribunal operated under such grant from obtaining legal representation during
any review by the expert panel under subsection (d), the administrative health
care tribunal under subsection (e), or a State court under subsection
(f).</text>
</subsection><subsection id="HE0897ADD46F145C79179C5E30C9BA14F"><enum>(d)</enum><header>Expert panel
review and early offer guidelines</header>
<paragraph id="HA71AF92AD52C4E028BCACD267BA94F13"><enum>(1)</enum><header>In
general</header><text>Prior to the submission of any dispute concerning
injuries allegedly caused by health care providers to an administrative health
care tribunal under this section, such allegations shall first be reviewed by
an expert panel.</text>
</paragraph><paragraph id="H38C96306FB304CBFAFAB153AFADDCBEF"><enum>(2)</enum><header>Composition</header>
<subparagraph id="HA5A59E8D32754D42B2AC3ED4C53F1F15"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">The members of each
expert panel under this subsection shall be appointed by the head of the State
agency responsible for health. Each expert panel shall be composed of no fewer
than 3 members and not more than 7 members. At least one-half of such members
shall be medical experts (either physicians or health care
professionals).</text>
</subparagraph><subparagraph id="HF2F3CB31EE714A369B9DD41EE4485F3F"><enum>(B)</enum><header>Licensure and
expertise</header><text>Each physician or health care professional appointed to
an expert panel under subparagraph (A) shall—</text>
<clause id="H6BBD9504CD8A4C98B5446243A285F315"><enum>(i)</enum><text>be
appropriately credentialed or licensed in 1 or more States to deliver health
care services; and</text>
</clause><clause id="H23B2AC843C684F22A1947D9F76D171FC"><enum>(ii)</enum><text>typically treat
the condition, make the diagnosis, or provide the type of treatment that is
under review.</text>
</clause></subparagraph><subparagraph id="HD10D65FFDD95453799AAFFBF3253C272"><enum>(C)</enum><header>Independence</header>
<clause id="H5A7A87C4D66E41599C8BA4012EBA3A25"><enum>(i)</enum><header>In
general</header><text>Subject to clause (ii), each individual appointed to an
expert panel under this paragraph shall—</text>
<subclause id="H91B47FDC849649B8B7DB6D0A8B89A77F"><enum>(I)</enum><text>not have a
material familial, financial, or professional relationship with a party
involved in the dispute reviewed by the panel; and</text>
</subclause><subclause id="H6129BBACFCD94C3DB16FD70C85A06066"><enum>(II)</enum><text>not otherwise
have a conflict of interest with such a party.</text>
</subclause></clause><clause id="H0E506BA355EA45A183990412127C180E"><enum>(ii)</enum><header>Exception</header><text>Nothing
in clause (i) shall be construed to prohibit an individual who has staff
privileges at an institution where the treatment involved in the dispute was
provided from serving as a member of an expert panel merely on the basis of
such affiliation, if the affiliation is disclosed to the parties and neither
party objects.</text>
</clause></subparagraph><subparagraph id="H206A7A5261E5418EAFAE478CA8180DF7"><enum>(D)</enum><header>Practicing
health care professional in same field</header>
<clause id="H946AC6CDB53344ABAAE4F371BBEFC8C6"><enum>(i)</enum><header>In
general</header><text>In a dispute before an expert panel that involves
treatment, or the provision of items or services—</text>
<subclause id="H353FE0D6BB724F039ED437971D04196C"><enum>(I)</enum><text>by a physician,
the medical experts on the expert panel shall be practicing physicians
(allopathic or osteopathic) of the same or similar specialty as a physician who
typically treats the condition, makes the diagnosis, or provides the type of
treatment under review; or</text>
</subclause><subclause id="HA66C2D69EB7C4DAD8AE965FA4C24D642"><enum>(II)</enum><text>by a health care
professional other than a physician, at least two medical experts on the expert
panel shall be practicing physicians (allopathic or osteopathic) of the same or
similar specialty as the health care professional who typically treats the
condition, makes the diagnosis, or provides the type of treatment under review,
and, if determined appropriate by the State agency, an additional medical
expert shall be a practicing health care professional (other than such a
physician) of such a same or similar specialty.</text>
</subclause></clause><clause id="H78727DEB06364C43A0F1DE4A0AD0A9C5"><enum>(ii)</enum><header>Practicing
defined</header><text>In this paragraph, the term <term>practicing</term>
means, with respect to an individual who is a physician or other health care
professional, that the individual provides health care services to individual
patients on average at least 2 days a week.</text>
</clause></subparagraph><subparagraph id="H12614DEBF4864F339F8FBF1E951D879D"><enum>(E)</enum><header>Pediatric
expertise</header><text>In the case of dispute relating to a child, at least 1
medical expert on the expert panel shall have expertise described in
subparagraph (D)(i) in pediatrics.</text>
</subparagraph></paragraph><paragraph id="HC018E5692CB149518EBD9D8EEFF30A9A"><enum>(3)</enum><header>Determination</header><text>After
a review under paragraph (1), an expert panel shall make a determination as to
the liability of the parties involved and compensation.</text>
</paragraph><paragraph id="HCF6461B9BBF34D34BA19B3AA38DF6876"><enum>(4)</enum><header>Acceptance</header><text>If
the parties to a dispute before an expert panel under this subsection accept
the determination of the expert panel concerning liability and compensation,
such compensation shall be paid to the claimant and the claimant shall agree to
forgo any further action against the health care providers involved.</text>
</paragraph><paragraph id="HE0664A8DB3C340E59D33B8FB5FC535AF"><enum>(5)</enum><header>Failure to
accept</header><text>If any party decides not to accept the expert panel’s
determination, the matter shall be referred to an administrative health care
tribunal created pursuant to this section.</text>
</paragraph></subsection><subsection id="H18829F021FF54DA3A673BCDAB8A89D06"><enum>(e)</enum><header>Administrative
health care tribunals</header>
<paragraph id="HC0721A9996904593A498FADC7ECE9014"><enum>(1)</enum><header>In
general</header><text>Upon the failure of any party to accept the determination
of an expert panel under subsection (d), the parties shall have the right to
request a hearing concerning the liability or compensation involved by an
administrative health care tribunal established by the State involved.</text>
</paragraph><paragraph id="H717F405713884E6E9511B8CCEA283605"><enum>(2)</enum><header>Requirements</header><text>In
establishing an administrative health care tribunal under this section, a State
shall—</text>
<subparagraph id="HB2B0B2193B884E3DA5413B4FA57B7E96"><enum>(A)</enum><text>ensure that such
tribunals are presided over by special judges with health care
expertise;</text>
</subparagraph><subparagraph id="H8B181B250A1249AE9A1BB4DD85EA761F"><enum>(B)</enum><text>provide authority
to such judges to make binding rulings, rendered in written decisions, on
standards of care, causation, compensation, and related issues with reliance on
independent expert witnesses commissioned by the tribunal;</text>
</subparagraph><subparagraph id="H4BBC4D36DF1445D3B3B24D807717B93D"><enum>(C)</enum><text>establish gross
negligence as the legal standard for the tribunal;</text>
</subparagraph><subparagraph id="HB30172CC00E7404F928277B01EFD5A4A"><enum>(D)</enum><text>allow the
admission into evidence of the recommendation made by the expert panel under
subsection (d); and</text>
</subparagraph><subparagraph id="H4D200A9FED8646DDA9230D41F6F66375"><enum>(E)</enum><text>provide for an
appeals process to allow for review of decisions by State courts.</text>
</subparagraph></paragraph></subsection><subsection id="H57919EDE5A12474E9D112506F2E8B632"><enum>(f)</enum><header>Review by State
court after exhaustion of administrative remedies</header>
<paragraph id="H0D6EB4CB61234416997210DCF28CC76A"><enum>(1)</enum><header>Right to
file</header><text>If any party to a dispute before a health care tribunal
under subsection (e) is not satisfied with the determinations of the tribunal,
the party shall have the right to file their claim in a State court of
competent jurisdiction.</text>
</paragraph><paragraph id="HCAF36E4F98794CD8AD04B33E31DA3693"><enum>(2)</enum><header>Forfeit of
awards</header><text>Any party filing an action in a State court in accordance
with paragraph (1) shall forfeit any compensation award made under subsection
(e).</text>
</paragraph><paragraph id="H75C2FD9265BA4810A4CEA633F096DDBE"><enum>(3)</enum><header>Admissibility</header><text>The
determinations of the expert panel and the administrative health care tribunal
pursuant to subsections (d) and (e) with respect to a State court proceeding
under paragraph (1) shall be admissible into evidence in any such State court
proceeding.</text>
</paragraph></subsection><subsection id="H55692B56C86C4D38A22EEDFC4E7F8F68"><enum>(g)</enum><header>Definition</header><text>In
this section, the term <term>health care provider</term> has the meaning given
such term for purposes of part A of title VII.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H1B8F99D843484BA9B264F0EF3115B092"><enum>(h)</enum><header>Authorization of
appropriations</header><text>There are authorized to be appropriated for any
fiscal year such sums as may be necessary for purposes of making grants to
States under this
section.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section display-inline="no-display-inline" id="H405D57C74B8D410FB58476013C100005"><enum>515.</enum><header>Affirmative
defense based on compliance with best practice guidelines</header>
<subsection id="HFE8C39B8743C42C8A145E4075EF112C5"><enum>(a)</enum><header>Selection and
issuance of best practices guidelines</header>
<paragraph id="H4C923ADE208A4553A72DC09D0B651675"><enum>(1)</enum><header>In
general</header><text>The Secretary of Health and Human Services (in this
section referred to as the <quote>Secretary</quote>) shall provide for the
selection and issuance of best practice guidelines (each in this subsection
referred to as a <quote>guideline</quote>) in accordance with paragraphs (2)
and (3).</text>
</paragraph><paragraph display-inline="no-display-inline" id="H12490A402DFE4AB18FBDD23B03DFDAB4"><enum>(2)</enum><header>Development
process</header><text display-inline="yes-display-inline">Not later than 90
days after the date of the enactment of this Act, the Secretary shall enter
into a contract with a qualified physician consensus-building organization
(such as the Physician Consortium for Performance Improvement), in concert and
agreement with physician specialty organizations, to develop guidelines for
treatment of medical conditions for application under subsection (b). Under the
contract, the organization shall take into consideration any endorsed
performance-based quality measures described in section 802. Under the contract
and not later than 18 months after the date of the enactment of this Act, the
organization shall submit best practice guidelines for issuance as guidelines
under paragraph (3).</text>
</paragraph><paragraph id="HCC659C6969CE4BD3A155299969517DAB"><enum>(3)</enum><header>Issuance</header>
<subparagraph id="HA31F6FD79A0244DD80D82FB08B1142BB"><enum>(A)</enum><header>In
general</header><text>Not later than 2 years after the date of the enactment of
this Act, the Secretary shall issue, by regulation, after notice and
opportunity for public comment, guidelines that have been recommended under
paragraph (2) for application under subsection (b).</text>
</subparagraph><subparagraph id="H8B5B1D175C7842029F27E75E2F8BC742"><enum>(B)</enum><header>Limitation</header><text display-inline="yes-display-inline">The Secretary may not issue guidelines
unless they have been approved or endorsed by qualified physician
consensus-building organization involved and physician specialty
organizations.</text>
</subparagraph><subparagraph id="H5789BCFEBC964FC5BEE2092B60F0D089"><enum>(C)</enum><header>Dissemination</header><text display-inline="yes-display-inline">The Secretary shall broadly disseminate the
guidelines so issued.</text>
</subparagraph></paragraph></subsection><subsection id="H6EDF146DCB544217BEE17D0232005F9D"><enum>(b)</enum><header>Limitation on
damages</header>
<paragraph id="HBDC40A4E3CA54D77AE9239AF0B136621"><enum>(1)</enum><header>Limitation on
noneconomic damages</header><text display-inline="yes-display-inline">In any
health care lawsuit, no noneconomic damages may awarded with respect to
treatment that is within a guideline issued under subsection (a).</text>
</paragraph><paragraph id="HE5CBEB4C4E3E49A19A3717EF670EFB05"><enum>(2)</enum><header>Limitation on
punitive damages</header><text>In any health care lawsuit, no punitive damages
may be awarded against a health care practitioner based on a claim that such
treatment caused the claimant harm if—</text>
<subparagraph id="H26DA50881902459AADDFC32B366BAB6D"><enum>(A)</enum><text>such treatment was
subject to the quality review by a qualified physician consensus-building
organization;</text>
</subparagraph><subparagraph id="H8E45C2507F6549C8800EFF4356389F65"><enum>(B)</enum><text display-inline="yes-display-inline">such treatment was approved in a guideline
that underwent full review by such organization, public comment, approval by
the Secretary, and dissemination as described in subparagraph (a); and</text>
</subparagraph><subparagraph id="H12970907037146BEAC4ECDAF974DB910"><enum>(C)</enum><text>such medical
treatment is generally recognized among qualified experts (including medical
providers and relevant physician specialty organizations) as safe, effective,
and appropriate.</text>
</subparagraph></paragraph></subsection><subsection id="H4EC356EBF2B14DB1BB3BFA2502FF3893"><enum>(c)</enum><header>Use</header>
<paragraph id="H0737B70BD86C43F2970F2F20C644BFB6"><enum>(1)</enum><header>Introduction as
evidence</header><text display-inline="yes-display-inline">Guidelines under
subsection (a) may not be introduced as evidence of negligence or deviation in
the standard of care in any civil action unless they have previously been
introduced by the defendant.</text>
</paragraph><paragraph id="HA3B95043143240E1AB058384D73E30C6"><enum>(2)</enum><header>No presumption
of negligence</header><text>There would be no presumption of negligence if a
participating physician does not adhere to such guidelines.</text>
</paragraph></subsection><subsection id="HF68DBB040B1D47B4B3C38D2C26F9211D"><enum>(d)</enum><header>Construction</header><text display-inline="yes-display-inline">Nothing in this section shall be construed
as preventing a State from—</text>
<paragraph id="H0D4840BABECA425F91223BB7C56F7468"><enum>(1)</enum><text>replacing their
current medical malpractice rules with rules that rely, as a defense, upon a
health care provider’s compliance with a guideline issued under subsection (a);
or</text>
</paragraph><paragraph id="H6DFBE06227874CAA9498A22D5CDB3C84"><enum>(2)</enum><text display-inline="yes-display-inline">applying additional guidelines or
safe-harbors that are in addition to, but not in lieu of, the guidelines issued
under subsection (a).</text>
</paragraph></subsection></section><section id="HB60C43D1823B4BD3A2C3E7DBDB9B68EA"><enum>516.</enum><header>Bad debt
deduction for doctors to partially offset the cost of providing uncompensated
care required to be provided under amendments made by the Emergency Medical
Treatment and Labor Act</header>
<subsection id="H2E91B7AF01AD42BFBA307758395535D5"><enum>(a)</enum><header>In
general</header><text>Section 166 of the Internal Revenue Code of 1986
(relating to bad debts) is amended by redesignating subsection (f) as
subsection (g) and by inserting after subsection (e) the following new
subsection:</text>
<quoted-block display-inline="no-display-inline" id="H6F08D2C584C64AF6873628DBB49CEF3C" style="OLC">
<subsection id="H50E6C129C88248D6B2127517821FF581"><enum>(f)</enum><header>Bad debt
treatment for doctors To partially offset cost of providing uncompensated care
required To be provided</header>
<paragraph id="H370114FB126347BEAB9DB46A270A4C3E"><enum>(1)</enum><header>Amount of
deduction</header>
<subparagraph id="H831EB042DE394866BF5D8F38EC644388"><enum>(A)</enum><header>In
general</header><text>For purposes of subsection (a), the basis for determining
the amount of any deduction for an eligible EMTALA debt shall be treated as
being equal to the Medicare payment amount.</text>
</subparagraph><subparagraph id="HAFE69D8CB51942A1A8F95BAC7D2D585C"><enum>(B)</enum><header>Medicare payment
amount</header><text display-inline="yes-display-inline">For purposes of
subparagraph (A), the Medicare payment amount with respect to an eligible
EMTALA debt is the fee schedule amount established under section 1848 of the
Social Security Act for the physicians’ service (to which such debt relates) as
if the service were provided to an individual enrolled under part B of title
XVIIII of such Act.</text>
</subparagraph></paragraph><paragraph id="HBCE4FC4648B746A09E684939BB9D9E53"><enum>(2)</enum><header>Eligible EMTALA
debt</header><text>For purposes of this section, the term <term>eligible EMTALA
debt</term> means any debt if—</text>
<subparagraph id="H704851A110284CBC8539B45B5A57991F"><enum>(A)</enum><text display-inline="yes-display-inline">such debt arose as a result of physicians’
services—</text>
<clause id="HA918C532A3BD4013B0BF28566B9EBB12"><enum>(i)</enum><text>which were
performed in an EMTALA hospital by a board-certified physician (whether as part
of medical screening or necessary stabilizing treatment and whether as an
emergency department physician, as an on-call physician, or otherwise),
and</text>
</clause><clause id="HCD68FBAF1F3E48F98EF69FB1679E9754"><enum>(ii)</enum><text>which were
required to be provided under section 1867 of the Social Security Act (42
U.S.C. 1395dd), and</text>
</clause></subparagraph><subparagraph id="HB693E18AE2B6456F9041745788FC7114"><enum>(B)</enum><text>such debt is
owed—</text>
<clause id="H782BFD1603C34227825763CEC2DCEEB7"><enum>(i)</enum><text>to
such physician, or</text>
</clause><clause id="HEFBAA92B578B4CF78E263EE1797ABCED"><enum>(ii)</enum><text>to an entity
if—</text>
<subclause id="HFEE1DFF6BBFF4ECF8AF93221ABDD2C00"><enum>(I)</enum><text>such entity is a
corporation and the sole shareholder of such corporation is such physician,
or</text>
</subclause><subclause id="HB990C9E0E4B04EAAB2B9F2E33DADC09C"><enum>(II)</enum><text>such entity is a
partnership and any deduction under this subsection with respect to such debt
is allocated to such physician or to an entity described in subclause
(I).</text>
</subclause></clause></subparagraph></paragraph><paragraph display-inline="no-display-inline" id="HC8F4FA9E7AA5483D8234370E14072415"><enum>(3)</enum><header>Board-certified
physician</header><text>For purposes of this subsection, the term
<term>board-certified physician</term> means any physician (as defined in
section 1861(r) of the Social Security Act (42 U.S.C. 1395x(r)) who is
certified by the American Board of Emergency Medicine or other appropriate
medical specialty board for the specialty in which the physician practices, or
who meets comparable requirements, as identified by the Secretary of the
Treasury in consultation with Secretary of Health and Human Services.</text>
</paragraph><paragraph id="HBF239DC2202F4F0EABD9FE652E9646EF"><enum>(4)</enum><header>Other
definitions</header><text>For purposes of this subsection—</text>
<subparagraph id="HF8C301247114468B9340F2E27030A429"><enum>(A)</enum><header>EMTALA
hospital</header><text display-inline="yes-display-inline">The term
<term>EMTALA hospital</term> means any hospital having a hospital emergency
department which is required to comply with section 1867 of the Social Security
Act (42 U.S.C. 1395dd) (relating to examination and treatment for emergency
medical conditions and women in labor).</text>
</subparagraph><subparagraph id="H65B36695E4004C02A82BCAE8E8F4F9C6"><enum>(B)</enum><header>Physicians’
services</header><text display-inline="yes-display-inline">The term
<term>physicians’ services</term> has the meaning given such term in section
1861(q) of the Social Security Act (42 U.S.C.
1395x(q)).</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection display-inline="no-display-inline" id="H3C4D8DC3E6D048F58779C42E0420533D"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to debts
arising from services performed in taxable years beginning after the date of
the enactment of this Act.</text>
</subsection></section><enum>VI</enum><header>Wellness and
Prevention</header>
<section id="HFD41727FB94D48C5857FA5E12F1A6221"><enum>601.</enum><header>Providing
financial incentives for treatment compliance</header>
<subsection id="HC626EB24F3E946A88C044E11F7DB8DD5"><enum>(a)</enum><header>ERISA limitation
on exception for wellness programs under HIPAA discrimination
rules</header><text>Section 702(b)(2) of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1182(b)(2)) is amended by adding after and
below subparagraph (B) the following:</text>
<quoted-block display-inline="no-display-inline" id="H6258D3EF84EA4B159582C4691B83109E" style="OLC">
<quoted-block-continuation-text quoted-block-continuation-text-level="paragraph">In
applying subparagraph (B), a group health plan (or a health insurance issuer
with respect to health insurance coverage) may vary premiums and cost-sharing
by up to 50 percent of the value of the benefits under the plan (or coverage)
based on participation (or lack of participation) in a standards-based wellness
program.</quoted-block-continuation-text><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HDD8C53C7B7A240D1B7749B63D1778455"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by subsection (a) shall apply to plan
years beginning more than 1 year after the date of the enactment of this
Act.</text>
</subsection></section><enum>VII</enum><header>Transparency and
Insurance Reform Measures</header>
<section id="H9E3728DE38E145C58088AE16F93153C6"><enum>701.</enum><header>Receipt and
response to requests for claim information</header>
<subsection id="H0812939B3E9A47EAB8A5D1E71F854E14"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Title XXVII of the
Public Health Service Act is amended by inserting after section 2713 the
following new section:</text>
<quoted-block display-inline="no-display-inline" id="H5FDF3CE6F4D24F0A9FA4F6F4A3F4C6B8" style="OLC">
<section id="H1D9CED294E8A4861B0B84E8A63AB5AEC"><enum>2714.</enum><header>Receipt and
response to requests for claim information</header>
<subsection id="H6722465A91864637AA6DD9065D680559"><enum>(a)</enum><header>Requirement</header>
<paragraph id="H6CCB366772EA4179865D3834045CAF56"><enum>(1)</enum><header>In
general</header><text>In the case of health insurance coverage offered in
connection with a group health plan, not later than the 30th day after the date
a health insurance issuer receives a written request for a written report of
claim information from the plan, plan sponsor, or plan administrator, the
health insurance issuer shall provide the requesting party the report, subject
to the succeeding provisions of this section.</text>
</paragraph><paragraph id="HBA25F86B457A4636B1B82A685253801E"><enum>(2)</enum><header>Exception</header><text>The
health insurance issuer is not obligated to provide a report under this
subsection regarding a particular employer or group health plan more than twice
in any 12-month period and is not obligated to provide such a report in the
case of an employer with fewer than 50 employees.</text>
</paragraph><paragraph id="H1D3197C0997A4DE2AFB4BB8513E98225"><enum>(3)</enum><header>Deadline</header><text>A
plan, plan sponsor, or plan administrator must request a report under this
subsection before or on the second anniversary of the date of termination of
coverage under a group health plan issued by the health insurance
issuer.</text>
</paragraph></subsection><subsection id="H649F783C359E4C41BFE3B2398376D7E5"><enum>(b)</enum><header>Form of report;
information To be included</header>
<paragraph id="H080CDC9B8A50412D898632A5CDA86192"><enum>(1)</enum><header>In
general</header><text>A health insurance issuer shall provide the report of
claim information under subsection (a)—</text>
<subparagraph id="H8764ECCCFC37436DB56FDD8646421E6C"><enum>(A)</enum><text>in a written
report;</text>
</subparagraph><subparagraph id="HF2BCD20AFF364F938B35BE8D053A76A7"><enum>(B)</enum><text>through an
electronic file transmitted by secure electronic mail or a file transfer
protocol site; or</text>
</subparagraph><subparagraph id="HF11097B2F79048369D1243A7E16B88D0"><enum>(C)</enum><text>by making the
required information available through a secure website or web portal
accessible by the requesting plan, plan sponsor, or plan administrator.</text>
</subparagraph></paragraph><paragraph id="H9E0A05FFC66E4963B1AF7EF5A7108270"><enum>(2)</enum><header>Information to
be included</header><text>A report of claim information provided under
subsection (a) shall contain all information available to the health insurance
issuer that is responsive to the request made under such subsection, including,
subject to subsection (c), protected health information, for the 36-month
period preceding the date of the report or the period specified by
subparagraphs (D), (E), and (F) of paragraph (3), if applicable, or for the
entire period of coverage, whichever period is shorter.</text>
</paragraph><paragraph id="H9B63F10EC56B4F8E8AA61BD66B94D716"><enum>(3)</enum><header>Required
information</header><text>Subject to subsection (c), a report provided under
subsection (a) shall include the following:</text>
<subparagraph id="HCD0FAE3FB9C949828E30DF270A36EA06"><enum>(A)</enum><text>Aggregate paid
claims experience by month, including claims experience for medical, dental,
and pharmacy benefits, as applicable.</text>
</subparagraph><subparagraph id="H6268F334B56B451FB671B41726056C84"><enum>(B)</enum><text>Total premium paid
by month.</text>
</subparagraph><subparagraph id="HA771BB0FE4384A67B9ABF50F71D8B906"><enum>(C)</enum><text>Total number of
covered employees on a monthly basis by coverage tier, including whether
coverage was for—</text>
<clause id="H1B38F77074474E3A923ECD443886C154"><enum>(i)</enum><text>an
employee only;</text>
</clause><clause id="H5FD20511083946F7A4C624D02F8059B9"><enum>(ii)</enum><text>an employee with
dependents only;</text>
</clause><clause id="HCA5AAE0C78304B43B3348CB0DA43F2E3"><enum>(iii)</enum><text>an employee with
a spouse only; or</text>
</clause><clause id="H127635D31B62491DB0EDB49DE41F66A8"><enum>(iv)</enum><text>an employee with
a spouse and dependents.</text>
</clause></subparagraph><subparagraph id="HBCCA35514BB6490995758FC4A4DE212A"><enum>(D)</enum><text>The total dollar
amount of claims pending as of the date of the report.</text>
</subparagraph><subparagraph id="H26C0F289AAB3467AB38DD02DA2747F09"><enum>(E)</enum><text>A separate
description and individual claims report for any individual whose total paid
claims exceed $15,000 during the 12-month period preceding the date of the
report, including the following information related to the claims for that
individual—</text>
<clause id="H20A35636B6904AA2A5C3D65FB54DE762"><enum>(i)</enum><text>a
unique identifying number, characteristic, or code for the individual;</text>
</clause><clause id="HAD2C55D4B5E84DFF8D4F4A2FCA040A5C"><enum>(ii)</enum><text>the amounts
paid;</text>
</clause><clause id="H23699E85DDA841FD8530DB9145E25732"><enum>(iii)</enum><text>dates of
service; and</text>
</clause><clause id="HA0F227646C314DACA0101831F53AD89F"><enum>(iv)</enum><text>applicable
procedure codes and diagnosis codes.</text>
</clause></subparagraph><subparagraph id="HAFE6B66C6FD24B5298FB858F889FC83F"><enum>(F)</enum><text>For claims that
are not part of the information described in a previous subparagraph, a
statement describing precertification requests for hospital stays of 5 days or
longer that were made during the 30-day period preceding the date of the
report.</text>
</subparagraph></paragraph></subsection><subsection id="H59537769350B45269E3E557C4E4267A6"><enum>(c)</enum><header>Limitations on
disclosure</header>
<paragraph id="H56D747BFF2564246920A380F123091C4"><enum>(1)</enum><header>In
general</header><text>A health insurance issuer may not disclose protected
health information in a report of claim information provided under this section
if the health insurance issuer is prohibited from disclosing that information
under another State or federal law that imposes more stringent privacy
restrictions than those imposed under federal law under the HIPAA privacy
regulations. To withhold information in accordance with this subsection, the
health insurance issuer must—</text>
<subparagraph id="H1F0EC6AF20DA4B57BA1156961FE5290C"><enum>(A)</enum><text>notify the plan,
plan sponsor, or plan administrator requesting the report that information is
being withheld; and</text>
</subparagraph><subparagraph id="H3C87ABB2C7634591AF1EB366AAA9F572"><enum>(B)</enum><text>provide to the
plan, plan sponsor, or plan administrator a list of categories of claim
information that the health insurance issuer has determined are subject to the
more stringent privacy restrictions under another State or Federal law.</text>
</subparagraph></paragraph><paragraph id="H694D3789F5424381BF0E3FEBF714350D"><enum>(2)</enum><header>Protection</header><text>A
plan sponsor is entitled to receive protected health information under
subparagraph (E) and (F) of subsection (b)(3) and subsection (d) only after an
appropriately authorized representative of the plan sponsor makes to the health
insurance issuer a certification substantially similar to the following
certification: <quote>I hereby certify that the plan documents comply with the
requirements of section 164.504(f)(2) of title 45, Code of Federal Regulations,
and that the plan sponsor will safeguard and limit the use and disclosure of
protected health information that the plan sponsor may receive from the group
health plan to perform the plan administration functions.</quote>.</text>
</paragraph><paragraph id="H129588D9255F404FB13B07B1C3914A43"><enum>(3)</enum><header>Results</header><text>A
plan sponsor that does not provide the certification required by paragraph (2)
is not entitled to receive the protected health information described by
subparagraphs (E) and (F) of subsection (b)(3) and subsection (d), but is
entitled to receive a report of claim information that includes the information
described by subparagraphs (A) through (D) of subsection (b)(3).</text>
</paragraph><paragraph id="H5D49D056FDD34F19A0B9CA294D6B2C67"><enum>(4)</enum><header>Information</header><text>In
the case of a request made under subsection (a) after the date of termination
of coverage, the report must contain all information available to the health
insurance issuer as of the date of the report that is responsive to the
request, including protected health information, and including the information
described by subsection (b)(3), for the period described by subsection (b)(2)
preceding the date of termination of coverage or for the entire policy period,
whichever period is shorter. Notwithstanding this subsection, the report may
not include the protected health information described by subparagraphs (E) and
(F) of subsection (b)(3) unless a certification has been provided in accordance
with paragraph (2).</text>
</paragraph></subsection><subsection id="H7BBEA549FC2D4C728010931E63E7084E"><enum>(d)</enum><header>Request for
additional information</header>
<paragraph id="HF4F616171FD74B209BD941DC1492B5CE"><enum>(1)</enum><header>Review</header><text>On
receipt of the report required by subsection (a), the plan, plan sponsor, or
plan administrator may review the report and, not later than the 10th day after
the date the report is received, may make a written request to the health
insurance issuer for additional information in accordance with this subsection
for specified individuals.</text>
</paragraph><paragraph id="H11A449CFB372441F9A6F769D06B9C8F0"><enum>(2)</enum><header>Request</header><text>With
respect to a request for additional information concerning specified
individuals for whom claims information has been provided under subsection
(b)(3)(E), the health insurance issuer shall provide additional information on
the prognosis or recovery if available and, for individuals in active case
management, the most recent case management information, including any future
expected costs and treatment plan, that relate to the claims for that
individual.</text>
</paragraph><paragraph id="H55AF390859EF48CBB7C06E5B293C9614"><enum>(3)</enum><header>Response</header><text>The
health insurance issuer must respond to the request for additional information
under this subsection not later than the 15th day after the date of such
request unless the requesting plan, plan sponsor, or plan administrator agrees
to a request for additional time.</text>
</paragraph><paragraph id="HBD5EE38D12754E019AD5608C32FA1690"><enum>(4)</enum><header>Limitation</header><text>The
health insurance issuer is not required to produce the report described by this
subsection unless a certification has been provided in accordance with
subsection (c)(2).</text>
</paragraph><paragraph id="HC1A6E8CC0AAF4DA283A3669556C2A1BE"><enum>(5)</enum><header>Compliance with
section does not create liability</header><text>A health insurance issuer that
releases information, including protected health information, in accordance
with this subsection has not violated a standard of care and is not liable for
civil damages resulting from, and is not subject to criminal prosecution for,
releasing that information.</text>
</paragraph></subsection><subsection id="H5E4B9AC5010440E1BB474F441758A202"><enum>(e)</enum><header>Limitation on
preemption</header><text display-inline="yes-display-inline">Nothing in this
section is meant to limit States from enacting additional laws in addition to
this, but not in lieu of.</text>
</subsection><subsection id="H15BBD0FD1A8F4C9094877819FA6BB6F4"><enum>(f)</enum><header>Definitions</header><text>In
this section:</text>
<paragraph id="H4A904BB8F1554AF1B18759068CFE71F3"><enum>(1)</enum><text>The terms
<term>employer</term>, <term>plan administrator</term>, and <term>plan
sponsor</term> have the meanings given such terms in section 3 of the Employee
Retirement Income Security Act of 1974.</text>
</paragraph><paragraph id="HB5859ACA599E4F168820A32F2023CE2A"><enum>(2)</enum><text>The term
<term>HIPAA privacy regulations</term> has the meaning given such term in
section 1180(b)(3) of the Social Security Act.</text>
</paragraph><paragraph id="HECD90E978B434AC68827CB096B471133"><enum>(3)</enum><text>The term
<term>protected health information</term> has the meaning given such term under
the HIPAA privacy
regulations.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H731E63826BC2495F95530A2C5A82DC7B"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by subsection (a) shall take effect on
the date of the enactment of this Act.</text>
</subsection></section><enum>VIII</enum><header>Quality</header>
<section id="HBA9B84A5961B431AB757B8B0F651A7F2"><enum>801.</enum><header>Prohibition on
certain uses of data obtained from comparative effectiveness research;
accounting for personalized medicine and differences in patient treatment
response</header>
<subsection id="HDFDC0351F5104D2F9AC723DDB624E51A"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Notwithstanding any
other provision of law, the Secretary of Health and Human Services—</text>
<paragraph id="H1CDA489DA3A84BB4808A9C8434B21EDA"><enum>(1)</enum><text display-inline="yes-display-inline">shall not use data obtained from the
conduct of comparative effectiveness research, including such research that is
conducted or supported using funds appropriated under the American Recovery and
Reinvestment Act of 2009 (Public Law 111–5), to deny coverage of an item or
service under a Federal health care program (as defined in section 1128B(f) of
the Social Security Act (42 U.S.C. 1320a–7b(f))); and</text>
</paragraph><paragraph id="H9F1A85FC7A7B4E3A806BD84BCE4D21EF"><enum>(2)</enum><text>shall ensure that
comparative effectiveness research conducted or supported by the Federal
Government accounts for factors contributing to differences in the treatment
response and treatment preferences of patients, including patient-reported
outcomes, genomics and personalized medicine, the unique needs of health
disparity populations, and indirect patient benefits.</text>
</paragraph></subsection><subsection id="H960CCE09E4D14D8D8244E7599655C68E"><enum>(b)</enum><header>Consultation and
approval required</header><text display-inline="yes-display-inline">Nothing the
Federal Coordinating Council for Comparative Effectiveness Research finds can
be released in final form until after consultation with and approved by
relevant physician specialty organizations.</text>
</subsection><subsection id="HAAB9F6C84F8F41FC990B33C1A67FBEFE"><enum>(c)</enum><header>Rule of
construction</header><text>Nothing in this section shall be construed as
affecting the authority of the Commissioner of Food and Drugs under the Federal
Food, Drug, and Cosmetic Act or the Public Health Service Act.</text>
</subsection></section><section id="HA72E9D49353E4912BA4D235F125CF839"><enum>802.</enum><header>Establishment
of performance-based quality measures</header><text display-inline="no-display-inline">Not later than January 1, 2010, the
Secretary of Health and Human Services shall submit to Congress a proposal for
a formalized process for the development of performance-based quality measures
that could be applied to physicians’ services under the Medicare program. Such
proposal shall be in concert and agreement with the Physician Consortium for
Performance Improvement and shall only utilize measures agreed upon by each
physician specialty organization.</text>
</section><enum>IX</enum><header>State
Transparency Plan Portal</header>
<section id="H2378B378364640039B2C8EAAE3242D93"><enum>901.</enum><header>Providing
information on health coverage options and health care providers</header>
<subsection id="H1CBBE377747A436695749CEED16DF5B3"><enum>(a)</enum><header>State-Based
portal</header><text display-inline="yes-display-inline">A State (by itself or
jointly with other States) may contract with a private entity to establish a
Health Plan and Provider Portal website (referred to in this section as a
<quote>plan portal</quote>) for the purposes of providing standardized
information—</text>
<paragraph id="H0707893715394F0FAD8AF6F8A4C1EC9C"><enum>(1)</enum><text>on health
insurance plans that have been certified to be available for purchase in that
State; and</text>
</paragraph><paragraph id="HDBDE8160A76F44039425092443A1CE2E"><enum>(2)</enum><text display-inline="yes-display-inline">on price and quality information on health
care providers (including physicians, hospitals, and other health care
institutions).</text>
</paragraph></subsection><subsection id="H1153456C12A543198F396DDEB2EA021C"><enum>(b)</enum><header>Pilot
program</header>
<paragraph id="HACD18E04504F4E3FBF1246D164B77A16"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">Not later than 90
days after the date of the enactment of this Act the Secretary of Health and
Human Services shall work with States to establish no later than 2011,
consistent with this title, a website that will serve as a pilot program for a
national portal for information structured in a manner so individuals may
directly link to the State plan portal for the State in which they
reside.</text>
</paragraph><paragraph id="H446CC97DC28A4ECE95CC9C1492D302EC"><enum>(2)</enum><header>Contracts with
State</header><text display-inline="yes-display-inline">The Secretary shall
enter into contracts with States, in a number and distribution determined by
the Secretary, to develop State plan portals that follow the applicable
standards and regulations under this section.</text>
</paragraph><paragraph id="H576138BF44A04AE1B9BBAB4826BB455B"><enum>(3)</enum><header>Common standards
for plan portals</header>
<subparagraph id="H05AF02A6D4104BD29CD76368BBA4F859"><enum>(A)</enum><header>In
general</header><text>In connection with such website, the Secretary shall
establish standards for interoperability and consistency for State plan portals
so that individuals can access and view information in a similar manner on plan
portals of different States. Such standards shall include standard definitions
for health insurance plan benefits so that individuals can accurately compare
health insurance plans within such portals and standards for the inclusion of
information described in subsection (c).</text>
</subparagraph><subparagraph id="HD40110949AF8427088B48A4E7631D8D9"><enum>(B)</enum><header>Consultation</header><text display-inline="yes-display-inline">The Secretary shall consult with a group
consisting of a balanced representation of the critical stakeholders (including
States, health insurance issuers, the National Association of Insurance
Commissioners, qualified health care provider-based entities (including
physicians, hospitals, and other health care institutions), and a standards
development organization) to develop such standards.</text>
</subparagraph><subparagraph id="HB17A740B093343B493EEDFC841187B8D"><enum>(C)</enum><header>Issuance</header>
<clause id="H5B803A04A27446F586DF8CED8DE14FEE"><enum>(i)</enum><header>In
general</header><text display-inline="yes-display-inline">Not later than 6
months after the date of the enactment of this Act, the Secretary shall issue,
by regulation, after notice and opportunity for public comment, standards that
are consistent with the recommendations made by the group under subparagraph
(B).</text>
</clause><clause id="H7F608B1625014233A0D207D9CDE07941"><enum>(ii)</enum><header>Dissemination</header><text display-inline="yes-display-inline">The Secretary shall broadly disseminate the
standards so issued.</text>
</clause></subparagraph><subparagraph id="H26709E6AC51546539F970D3A8B02D719"><enum>(D)</enum><header>Review</header><text display-inline="yes-display-inline">One year after the date of establishment of
the pilot program under this subsection, the Secretary, in consultation with
stakeholder group described in subparagraph (B), shall review the standards
established and make such changes in such standards as may be
appropriate.</text>
</subparagraph></paragraph><paragraph id="HA35B8DD6F9C54576AC74B98E08BD09B1"><enum>(4)</enum><header>Authorization of
appropriations</header><text>There are authorized to be appropriated to the
Secretary such amounts as may be necessary for—</text>
<subparagraph id="H701E85350BC648EA98396741659ED528"><enum>(A)</enum><text>the development
and operation of the national website under this subsection; and</text>
</subparagraph><subparagraph id="H9DEC6739279A467D87226EE7EA89EC07"><enum>(B)</enum><text>contracts with
States under paragraph (2) to assist in the development and initial operation
of plan portals in accordance with standards established under paragraph (3)
and other applicable provisions of this section.</text>
</subparagraph></paragraph></subsection><subsection id="H8EAA939C05014CA0BE913F2ACD889C85"><enum>(c)</enum><header>Information in
plan portals</header><text display-inline="yes-display-inline">The standards
for plan portals under subsection (b)(3) shall include the following:</text>
<paragraph id="H9D7B68053A7248E3B371CE21948DB923"><enum>(1)</enum><header>Health insurance
information</header><text>Each plan portal shall meet the following
requirements with respect to information on health insurance plans:</text>
<subparagraph id="H5ABE4FACED724120BAB9564A0B074785"><enum>(A)</enum><text>The plan portal
shall present complete information on the costs and benefits of health
insurance plans (including information on monthly premium, copayments,
deductibles, and covered benefits) in a uniform manner that—</text>
<clause id="HF2D03C6246D8486E84FCC2D19B9838C0"><enum>(i)</enum><text>uses
the standard definitions developed under subsection (b)(3); and</text>
</clause><clause id="HADAA4BB4CE3443F7B9ED6B618222FA47"><enum>(ii)</enum><text>is
designed to allow consumers to easily compare such plans.</text>
</clause></subparagraph><subparagraph id="HC62C9AF4D7484DEEB6E085B86F31A6B8"><enum>(B)</enum><text>The plan portal
shall be available on the internet and accessible to all individuals in the
United States.</text>
</subparagraph><subparagraph id="H916F58D9214645D09C6B9D4EF138FC17"><enum>(C)</enum><text>The plan portal
shall allow consumers to search and sort data on the health insurance plans in
the plan portal on criteria such as coverage of specific benefits (such as
coverage of disease management services or pediatric care services), as well as
data available respecting quality of plans.</text>
</subparagraph><subparagraph id="HF0481F871AE14EB7ACA335603C703CB5"><enum>(D)</enum><text>The plan portal
shall meet all relevant State laws and regulations, including laws and
regulations related to the marketing of insurance products.</text>
</subparagraph><subparagraph id="H62B1841471FE4CA9B0C6D8BFB8C6D6C4"><enum>(E)</enum><text display-inline="yes-display-inline">Notwithstanding subsection (d)(1), the plan
portal shall provide information to individuals who are eligible for the
Medicaid program under title XIX of the Social Security Act or State Children’s
Health Insurance Program under title XXI of such Act by including information
on options, eligibility, and how to enroll through providing a link to a
website maintained with respect to such State programs.</text>
</subparagraph><subparagraph id="HBE99721F53744934A9F2519F6FA46FE5"><enum>(F)</enum><text display-inline="yes-display-inline">The plan portal shall provide support to
individuals who are eligible for tax credits and deductions under the
amendments made by this Act to enhance such individual’s ability to access such
credits and deductions.</text>
</subparagraph><subparagraph id="H41A7B4F880F04D198503FF2059791FB3"><enum>(G)</enum><text>The plan portal
shall allow consumers to access quality data on providers as made available
through a website described in section 802 once that data is available.</text>
</subparagraph></paragraph><paragraph id="H87163A890D1C4ED4A7834A39F6229CD6"><enum>(2)</enum><header>Provider
information</header><text display-inline="yes-display-inline">Each plan portal
shall meet the following requirements with respect to information on health
care providers:</text>
<subparagraph id="HA04A0B57F4DC44B3B0DD94461709B45D"><enum>(A)</enum><text>Identifying and
licensure information.</text>
</subparagraph><subparagraph id="H0763A98201FE4E77B82E21418310D178"><enum>(B)</enum><text>Self-pay prices
charged, including variation in such prices.</text>
</subparagraph><continuation-text continuation-text-level="paragraph">For purposes
of subparagraph (B), the term <term>self-pay price</term> means the price
charged by a provider to individuals for items or services where the price is
not established or negotiated through a health care program or third
party.</continuation-text></paragraph><paragraph id="H456921A30CA74C70BD5406A6BE86984F"><enum>(3)</enum><header>Tax credit and
deduction information</header><text>Each plan portal shall also include
information on tax credits and deductions that may be available for purpose of
qualified health plans.</text>
</paragraph><paragraph id="H7724C0BA1B45462B9D143442866F2549"><enum>(4)</enum><header>Inclusion of
quality information</header><text>The Secretary, after collaboration with
States and health care providers (including practicing physicians, hospitals,
and other health care institutions), shall submit to Congress recommendations
on how to include on plan portals information on performance-based quality
measures obtained under section 802.</text>
</paragraph></subsection><subsection id="H9DF428B8BE5C4E949EC848F0FACCEAA7"><enum>(d)</enum><header>Prohibitions</header>
<paragraph id="H95933266472C431188D6B0911F137130"><enum>(1)</enum><header>Direct
Enrollment</header><text>A plan portal may not directly enroll individuals in
health insurance plans or under a State Medicaid plan or a State children’s
health insurance plan.</text>
</paragraph><paragraph id="H2E4489DA98074FEDBB761883247F7FE3"><enum>(2)</enum><header>Conflicts of
interest</header>
<subparagraph id="H11BB70EDC8D74F78BBF6A01B073E98AA"><enum>(A)</enum><header>Companies</header><text>A
health insurance issuer offering a health insurance plan through a plan portal
may not—</text>
<clause id="H3D0E110B04294DBC892C18E82CBD7DA4"><enum>(i)</enum><text>be
the private entity developing and maintaining a plan portal under this section;
or</text>
</clause><clause id="HF843C4AEF4634F0B876A8918EDD9F27F"><enum>(ii)</enum><text>have an ownership
interest in such private entity or in the plan portal.</text>
</clause></subparagraph><subparagraph id="H38DFC81995334DB6A45A7F05B41DEB15"><enum>(B)</enum><header>Individuals</header><text display-inline="yes-display-inline">An individual employed by a health
insurance issuer offering a health insurance plan through a plan portal may not
serve as a director or officer for—</text>
<clause id="H4F7B3A4ABE6D46599F7F66D9CFE3C341"><enum>(i)</enum><text>the
private entity developing and maintaining a plan portal under this section;
or</text>
</clause><clause id="HDC1CDB66BCDF4314BEEB7864737FE595"><enum>(ii)</enum><text>the
plan portal.</text>
</clause></subparagraph></paragraph></subsection><subsection id="H3C6C7D47BC474930B269AAD78542E758"><enum>(e)</enum><header>Construction</header><text>Nothing
in this section shall be construed to prohibit health insurance brokers and
agents from—</text>
<paragraph id="H59B8A1C7957F427494E2861EFABBED73"><enum>(1)</enum><text>utilizing the plan
portal for any purpose; or</text>
</paragraph><paragraph id="HD12E3C89A9E44BA8BE0DB96F9DC3B42A"><enum>(2)</enum><text>marketing or
offering health insurance products.</text>
</paragraph></subsection><subsection id="H718DDB4E306A48D19CEDDB4D4AA20F94"><enum>(f)</enum><header>State
defined</header><text>In this section, the term <term>State</term> has the
meaning given such term for purposes of title XIX of the Social Security
Act.</text>
</subsection></section><enum>X</enum><header>Physician payment
reform</header>
<section id="H05132ACFDDB4405D809E45E9A79AAABE" section-type="subsequent-section"><enum>1001.</enum><header>Sustainable growth
rate reform</header>
<subsection id="HD369FCBAD4364DE79A23CC8529FE268D"><enum>(a)</enum><header>Transitional
update for 2010</header><text>Section 1848(d) of the Social Security Act (42
U.S.C. 1395w–4(d)) is amended by adding at the end the following new
paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H9ED28D3CF598447CB19AC32AA10EAA73" style="OLC">
<paragraph id="H45ECD19987CD4DA58AB7DB331C818A0C"><enum>(10)</enum><header>Update for
2010</header><text display-inline="yes-display-inline">The update to the single
conversion factor established in paragraph (1)(C) for 2010 shall be the
percentage increase in the MEI (as defined in section 1842(i)(3)) for that
year.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HE7090D435D4F4B4FAD43758A1AEC0B6B"><enum>(b)</enum><header>Rebasing SGR
using 2009; limitation on cumulative adjustment period</header><text display-inline="yes-display-inline">Section 1848(d)(4) of such Act (42 U.S.C.
1395w–4(d)(4)) is amended—</text>
<paragraph commented="no" id="H492BD26BEE8346228E1655D980852AFC"><enum>(1)</enum><text>in subparagraph
(B), by striking <quote>subparagraph (D)</quote> and inserting
<quote>subparagraphs (D) and (G)</quote>; and</text>
</paragraph><paragraph commented="no" id="H2F8EFD5043FF4931BA4A736945F2BB1C"><enum>(2)</enum><text>by adding at the
end the following new subparagraph:</text>
<quoted-block display-inline="no-display-inline" id="H2F4546FAF7C04261997C0FE5767DC488" style="OLC">
<subparagraph commented="no" id="HF4282E7EFD8D42BBB31C6C48B2FD68F9"><enum>(G)</enum><header>Rebasing using
2009 for future update adjustments</header><text>In determining the update
adjustment factor under subparagraph (B) for 2011 and subsequent years—</text>
<clause commented="no" id="HAD285711D2C745D88FB8FB3E5FD3A62D"><enum>(i)</enum><text>the allowed
expenditures for 2009 shall be equal to the amount of the actual expenditures
for physicians’ services during 2009; and</text>
</clause><clause commented="no" id="H147ECE8D2C9F4648A3922451A1ABD280"><enum>(ii)</enum><text display-inline="yes-display-inline">the reference in subparagraph (B)(ii)(I) to
<quote>April 1, 1996</quote> shall be treated as a reference to <quote>January
1, 2009 (or, if later, the first day of the fifth year before the year
involved)</quote>.</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="H9D6C8BD880F64508915CC4D189C2706C"><enum>(c)</enum><header>Limitation on
physicians’ services included in target growth rate computation to services
covered under physician fee schedule</header><text display-inline="yes-display-inline">Effective for services furnished on or
after January 1, 2009, section 1848(f)(4)(A) of such Act is amended striking
<quote>(such as clinical</quote> and all that follows through <quote>in a
physician’s office</quote> and inserting <quote>for which payment under this
part is made under the fee schedule under this section, for services for
practitioners described in section 1842(b)(18)(C) on a basis related to such
fee schedule, or for services described in section 1861(p) (other than such
services when furnished in the facility of a provider of
services)</quote>.</text>
</subsection><subsection id="HCDDCF28297EA4DD6A522F8913860600A"><enum>(d)</enum><header>Establishment of
separate target growth rates for categories of services</header>
<paragraph display-inline="no-display-inline" id="HBBCB9764841541DAB15CA2C984A2B570"><enum>(1)</enum><header>Establishment of
service categories</header><text>Subsection (j) of section 1848 of the Social
Security Act (42 U.S.C. 1395w–4) is amended by adding at the end the following
new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H97CFCE95A23244F396F798E5FBE6E409" style="OLC">
<paragraph id="HC7BF6113895449AD95BF93AC75519CD6"><enum>(5)</enum><header>Service
categories</header><text>For services furnished on or after January 1, 2009,
each of the following categories of physicians’ services (as defined in
paragraph (3)) shall be treated as a separate <quote>service
category</quote>:</text>
<subparagraph commented="no" id="H49799EC914FF42159F3DC588393FA1AE"><enum>(A)</enum><text display-inline="yes-display-inline">Evaluation and management services that are
procedure codes (for services covered under this title) for—</text>
<clause id="H6FD9744C6B4E4C8E8A1746EF7512135B"><enum>(i)</enum><text display-inline="yes-display-inline">services in the category designated
Evaluation and Management in the Health Care Common Procedure Coding System
(established by the Secretary under subsection (c)(5) as of December 31, 2009,
and as subsequently modified by the Secretary); and</text>
</clause><clause id="H3B3B687E6FBF4522BF51D9E0030B7F5D"><enum>(ii)</enum><text>preventive
services (as defined in section 1861(iii)) for which payment is made under this
section.</text>
</clause></subparagraph><subparagraph id="H1290F0922152472C93796ACB13BE47E9"><enum>(B)</enum><text>All other services
not described in subparagraph (A).</text>
</subparagraph><continuation-text continuation-text-level="paragraph">Service
categories established under this paragraph shall apply without regard to the
specialty of the physician furnishing the
service.</continuation-text></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="H546C470AF768411CA43E8BBCE7B7BF58"><enum>(2)</enum><header>Establishment of
separate conversion factors for each service category</header><text>Subsection
(d)(1) of section 1848 of the Social Security Act (42 U.S.C. 1395w–4) is
amended—</text>
<subparagraph id="H3239CDB8AAEC4B0B8F5B5892A91085AC"><enum>(A)</enum><text>in subparagraph
(A)—</text>
<clause id="HD118FDC9E21B47DAB9119F67EB7DA044"><enum>(i)</enum><text>by
designating the sentence beginning <quote>The conversion factor</quote> as
clause (i) with the heading <quote><header-in-text level="clause" style="OLC">Application of single conversion factor</header-in-text>.—</quote>
and with appropriate indentation;</text>
</clause><clause id="H0AD85D8E0F6C4DE3A41898200920493A"><enum>(ii)</enum><text>by
striking <quote>The conversion factor</quote> and inserting <quote>Subject to
clause (ii), the conversion factor</quote>; and</text>
</clause><clause id="HDC2827E795E24ECCB70374DACF351563"><enum>(iii)</enum><text>by
adding at the end the following new clause:</text>
<quoted-block display-inline="no-display-inline" id="HED1420247D7446CE938FF1BF042F3AFA" style="OLC">
<clause id="H0B75D30171754E0DA8CE0B88A83A81F8"><enum>(ii)</enum><header>Application of
multiple conversion factors beginning with 2011</header>
<subclause id="H8D748DC3D61B47D3A4CCBA7E37607D62"><enum>(I)</enum><header>In
general</header><text display-inline="yes-display-inline">In applying clause
(i) for years beginning with 2011, separate conversion factors shall be
established for each service category of physicians’ services (as defined in
subsection (j)(5)) and any reference in this section to a conversion factor for
such years shall be deemed to be a reference to the conversion factor for each
of such categories.</text>
</subclause><subclause id="H699C189BDAA849E091869A36C1D1C955"><enum>(II)</enum><header>Initial
conversion factors</header><text>Such factors for 2011 shall be based upon the
single conversion factor for the previous year multiplied by the update
established under paragraph (11) for such category for 2011.</text>
</subclause><subclause id="HB110D8071B1844D6823EB9D186A7558A"><enum>(III)</enum><header>Updating of
conversion factors</header><text>Such factor for a service category for a
subsequent year shall be based upon the conversion factor for such category for
the previous year and adjusted by the update established for such category
under paragraph (11) for the year
involved.</text>
</subclause></clause><after-quoted-block>;
and</after-quoted-block></quoted-block>
</clause></subparagraph><subparagraph id="HEF621AB3ED354E18A2FD36B446680C97"><enum>(B)</enum><text>in subparagraph
(D), by striking <quote>other physicians’ services</quote> and inserting
<quote>for physicians’ services described in the service category described in
subsection (j)(5)(B)</quote>.</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="HB2E8EE54F5B34640AD72B88C6C84CB11"><enum>(3)</enum><header>Establishing
updates for conversion factors for service categories</header><text>Section
1848(d) of the Social Security Act (42 U.S.C. 1395w–4(d)), as amended by
subsection (a), is amended—</text>
<subparagraph id="HA99A62ED13CE44E0B7BCF619FED8310B"><enum>(A)</enum><text>in paragraph
(4)(C)(iii), by striking <quote>The allowed</quote> and inserting
<quote>Subject to paragraph (11)(B), the allowed</quote>; and</text>
</subparagraph><subparagraph id="H26CADDCC644848B6AAFB79C72DBC3F88"><enum>(B)</enum><text>by adding at the
end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HD436C9EEBC2A4AEA8799013A540F0B4C" style="OLC">
<paragraph id="H0AC0D75786614E0384E47E679BAFD030"><enum>(11)</enum><header>Updates for
service categories beginning with 2011</header>
<subparagraph id="HD67F0027B1B347189731DB12E0BF48FA"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">In applying paragraph
(4) for a year beginning with 2011, the following rules apply:</text>
<clause id="HB131F76C0B314970ABA7E03E352C2EED"><enum>(i)</enum><header>Application of
separate update adjustments for each service category</header><text>Pursuant to
paragraph (1)(A)(ii)(I), the update shall be made to the conversion factor for
each service category (as defined in subsection (j)(5)) based upon an update
adjustment factor for the respective category and year and the update
adjustment factor shall be computed, for a year, separately for each service
category.</text>
</clause><clause id="H76E74572DC20429092777F56DA4F7210"><enum>(ii)</enum><header>Computation of
allowed and actual expenditures based on service categories</header><text>In
computing the prior year adjustment component and the cumulative adjustment
component under clauses (i) and (ii) of paragraph (4)(B), the following rules
apply:</text>
<subclause id="HAAA93FAE13D24FA9BBE94481A739A4D9"><enum>(I)</enum><header>Application
based on service categories</header><text>The allowed expenditures and actual
expenditures shall be the allowed and actual expenditures for the service
category, as determined under subparagraph (B).</text>
</subclause><subclause id="H0A9986A39E1C41459F284ABC7BF52F45"><enum>(II)</enum><header>Application of
category specific target growth rate</header><text>The growth rate applied
under clause (ii)(II) of such paragraph shall be the target growth rate for the
service category involved under subsection (f)(5).</text>
</subclause></clause></subparagraph><subparagraph display-inline="no-display-inline" id="H9FD607D84E2A440D9D0F413761BA70B6"><enum>(B)</enum><header>Determination of
allowed expenditures</header><text display-inline="yes-display-inline">In
applying paragraph (4) for a year beginning with 2010, notwithstanding
subparagraph (C)(iii) of such paragraph, the allowed expenditures for a service
category for a year is an amount computed by the Secretary as follows:</text>
<clause id="H0780A832711844989825821FB45E0E2C"><enum>(i)</enum><header>For
2010</header><text display-inline="yes-display-inline">For 2010:</text>
<subclause id="HD92E3081BA5D4377A40A5798737DCAF4"><enum>(I)</enum><header>Total 2009
actual expenditures for all services included in SGR computation for each
service category</header><text display-inline="yes-display-inline">Compute
total actual expenditures for physicians’ services (as defined in subsection
(f)(4)(A)) for 2009 for each service category.</text>
</subclause><subclause id="HE21DF70968C64CACBBF867267A0816A0"><enum>(II)</enum><header>Increase by
growth rate to obtain 2010 allowed expenditures for service
category</header><text>Compute allowed expenditures for the service category
for 2010 by increasing the allowed expenditures for the service category for
2009 computed under subclause (I) by the target growth rate for such service
category under subsection (f) for 2010.</text>
</subclause></clause><clause id="H93322A79E4C14F9E85CFFC0CF09D3CC2"><enum>(ii)</enum><header>For subsequent
years</header><text display-inline="yes-display-inline">For a subsequent year,
take the amount of allowed expenditures for such category for the preceding
year (under clause (i) or this clause) and increase it by the target growth
rate determined under subsection (f) for such category and
year.</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="HC85DF9BB5B6B43FF89E04ECBF1A61385"><enum>(4)</enum><header>Application of
separate target growth rates for each category</header>
<subparagraph id="H8378DF210A934C6588936CBDC502336B"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">Section 1848(f) of
the Social Security Act (42 U.S.C. 1395w–4(f)) is amended by adding at the end
the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H9DFD3DF230584E97B01B829D2D1044AE" style="OLC">
<paragraph id="HCA7E41B2F5364FE9AAC4D1EB857EA649"><enum>(5)</enum><header>Application of
separate target growth rates for each service category beginning with
2010</header><text>The target growth rate for a year beginning with 2010 shall
be computed and applied separately under this subsection for each service
category (as defined in subsection (j)(5)) and shall be computed using the same
method for computing the target growth rate except that the factor described in
paragraph (2)(C) for—</text>
<subparagraph id="HA7C692179ACF4CEEA4CAEBEDB4FEAB36"><enum>(A)</enum><text display-inline="yes-display-inline">the service category described in
subsection (j)(5)(A) shall be increased by 0.02; and</text>
</subparagraph><subparagraph id="H989EBD61D069465DAD9D884040666430"><enum>(B)</enum><text display-inline="yes-display-inline">the service category described in
subsection (j)(5)(B) shall be increased by
0.01.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph><subparagraph commented="no" id="H914BE8B717C746F0BD3F090F7FB296DD"><enum>(B)</enum><header>Use of target
growth rates</header><text>Section 1848 of such Act is further amended—</text>
<clause commented="no" id="H3CA35930C77A4402ABDC4E3FEF0A09F6"><enum>(i)</enum><text>in subsection
(d)—</text>
<subclause commented="no" id="H27491A6CD64E4142AC8C527B4174A158"><enum>(I)</enum><text>in paragraph
(1)(E)(ii), by inserting <quote>or target</quote> after
<quote>sustainable</quote>; and</text>
</subclause><subclause commented="no" id="HC95FDA4F455540F5823E6E829F278A5D"><enum>(II)</enum><text display-inline="yes-display-inline">in paragraph (4)(B)(ii)(II), by inserting
<quote>or target</quote> after <quote>sustainable</quote>; and</text>
</subclause></clause><clause commented="no" id="H51C132A2AF8241EB9843962CEA12DB12"><enum>(ii)</enum><text display-inline="yes-display-inline">in the heading of subsection (f), by
inserting <quote><header-in-text level="subsection" style="OLC">and target
growth rate</header-in-text></quote> after <quote><header-in-text level="subsection" style="OLC">sustainable growth
rate</header-in-text></quote>;</text>
</clause><clause commented="no" id="HEB67D0D7914046F0AE44364687A4B3F2"><enum>(iii)</enum><text>in subsection
(f)(1)—</text>
<subclause commented="no" id="H8614B924A3AB45B5A075C77B018A0D16"><enum>(I)</enum><text>by striking
<quote>and</quote> at the end of subparagraph (A);</text>
</subclause><subclause commented="no" id="H5B30150A480345AAB61672FE7A1B4181"><enum>(II)</enum><text>in subparagraph
(B), by inserting <quote>before 2010</quote> after <quote>each succeeding
year</quote> and by striking the period at the end and inserting <quote>;
and</quote>; and</text>
</subclause><subclause commented="no" id="HD496340482364093B2C553D85DAEC8B8"><enum>(III)</enum><text>by adding at the
end the following new subparagraph:</text>
<quoted-block display-inline="no-display-inline" id="HF760C1F6CE4D4348A4127E4AAB30724E" style="OLC">
<subparagraph commented="no" id="HA14C57B2BFEA41BB9C867A56097EBCA3"><enum>(C)</enum><text>November 1 of each
succeeding year the target growth rate for such succeeding year and each of the
2 preceding years.</text>
</subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subclause></clause><clause commented="no" id="H45471A88F1F946B8B344C0B6959F2AF1"><enum>(iv)</enum><text>in subsection
(f)(2), in the matter before subparagraph (A), by inserting after
<quote>beginning with 2000</quote> the following: <quote>and ending with
2009</quote>.</text>
</clause></subparagraph></paragraph></subsection></section><enum>XI</enum><header>Incentives to
reduce physician shortages </header>
<subtitle id="H89587CB1A9BB4AA68B9BA99F97AFF2F5"><enum>A</enum><header>Federally
Supported Student Loan Funds for Medical Students</header>
<section display-inline="no-display-inline" id="H07774339A3934788B1642016EE889FFA" section-type="subsequent-section"><enum>1101.</enum><header>Federally Supported
Student Loan Funds for Medical Students</header>
<subsection id="HD2E1B103DC6B4C379A1E1AF3A9B88ECA"><enum>(a)</enum><header>Primary health
care medical students</header><text>Subpart II of part A of the Public Health
Service Act (42 U.S.C. 292q et seq.) is amended—</text>
<paragraph id="H500769B2AEA0439FB2916AB16AAE1857"><enum>(1)</enum><text>by redesignating
section 735 as section 729; and</text>
</paragraph><paragraph id="H492007830D3B4907B5B3E4F9CFB5AE46"><enum>(2)</enum><text>in subsection (f)
of section 729 (as so redesignated), by striking <quote>is authorized to be
appropriated to be appropriated $10,000,000 for each of the fiscal years 1994
through 1996</quote> and inserting <quote>are authorized to be appropriated
such sums as may be necessary for fiscal year 2010 and each fiscal year
thereafter</quote>.</text>
</paragraph></subsection><subsection id="HDEFB69926E6948D392F5FC0F0D46919A"><enum>(b)</enum><header>Other medical
students</header><text display-inline="yes-display-inline">Part A of title VII
of the Public Health Service Act (42 U.S.C. 292 et seq.) is amended by adding
at the end the following:</text>
<quoted-block display-inline="no-display-inline" id="H6D2DC90C910E4F6FBF33A9101928C8EF" style="OLC">
<subpart id="H024C81D769F64D969F6739D3E42D9DAE"><enum>III</enum><header>Federally
Supported Student Loan Funds for Certain Medical Students</header>
<section id="H9DD9E8E2C65A4E249B0CC39CD1539FD1"><enum>730.</enum><header>School loan
funds for certain medical students</header>
<subsection id="H5CE765ABF74F4CC1B6FD291AA170828A"><enum>(a)</enum><header>Fund
agreements</header><text>For the purpose described in subsection (b), the
Secretary is authorized to enter into an agreement for the establishment and
operation of a student loan fund with any public or nonprofit school of
medicine or osteopathic medicine.</text>
</subsection><subsection id="H7B063A464663483AA9014AF95FE8E130"><enum>(b)</enum><header>Purpose</header><text>The
purpose of this subpart is to provide for loans to medical students who would
be eligible for a loan under subpart II, except for the student’s decision to
enter a residency training program in a field other than primary health
care.</text>
</subsection><subsection id="H1D5BF6EDB5F341199B411E6192013D73"><enum>(c)</enum><header>Commencement of
repayment period</header><text display-inline="yes-display-inline">The
repayment period for a loan under this section shall not begin before the end
of any period during which the student is participating in an internship,
residency, or fellowship training program directly related to the field of
medicine which the student agrees to enter pursuant to subsection (d).</text>
</subsection><subsection id="H1587DDC3DE124A6BA221040547992A62"><enum>(d)</enum><header>Requirements for
students</header><text>Each agreement under this section for the establishment
of a student loan fund shall provide that the school of medicine or osteopathic
medicine will make a loan to a student from such fund only if the student
agrees—</text>
<paragraph id="H4350B6D10BE64CDDB2804077886DF53D"><enum>(1)</enum><text>to enter and
complete a residency training program (in a field of medicine other than
primary health care) not later than a period determined by the Secretary to be
reasonable after the date on which the student graduates from such school;
and</text>
</paragraph><paragraph id="HBD120409DBFC4BEE8B13764C7B0712A4"><enum>(2)</enum><text>to practice
medicine through the date on which the loan is repaid in full.</text>
</paragraph></subsection><subsection id="H583D6DCC194F4481867F50701DC481DA"><enum>(e)</enum><header>Requirements for
schools</header><text>The provisions of section 723(b) (regarding graduates in
primary health care) shall not apply to a student loan fund established under
this section.</text>
</subsection><subsection id="HA0F908DFD4D84E5F9B19F7CD7A0DAE22"><enum>(f)</enum><header>Applicability of
other provisions</header><text>Except as inconsistent with this section, the
provisions of subpart II shall apply to the program of student loan funds
established under this section to the same extent and in the same manner as
such provisions apply to the program of student loan funds established under
subpart II.</text>
</subsection><subsection id="HDD4FD40C966A4AD58F88F8E0A18FEF6C"><enum>(g)</enum><header>Authorization of
appropriations</header><text>To carry out this section, there are authorized to
be appropriated such sums as may be necessary for fiscal year 2010 and each
fiscal year
thereafter.</text>
</subsection></section></subpart><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section></subtitle><subtitle id="HB2FED6C406F5465387EAAD3D9B3781CA"><enum>B</enum><header>Loan Forgiveness
for Primary Care Providers</header>
<section id="H37F5824C2A544EA988CDC1134085F529"><enum>1111.</enum><header>Loan
forgiveness for primary care providers</header>
<subsection id="HAD0D6FCDC8334F48A13AE7D546397E74"><enum>(a)</enum><header>In
general</header><text>The Secretary of Health and Human Services shall carry
out a program of entering into contracts with eligible individuals under
which—</text>
<paragraph id="HE0C9C037A3624C09BB13D753DB60A021"><enum>(1)</enum><text>the individual
agrees to serve for a period of not less than 5 years as a primary care
provider; and</text>
</paragraph><paragraph id="HD0AF1FC53A6547C28BAE96E872C827CE"><enum>(2)</enum><text>in consideration
of such service, the Secretary agrees to pay not more than $50,000 on the
principal and interest on the individual’s graduate educational loans.</text>
</paragraph></subsection><subsection id="HC457C91E23C4442F969D818AC84FC29E"><enum>(b)</enum><header>Eligibility</header><text>To
be eligible to enter into a contract under subsection (a), an individual
must—</text>
<paragraph id="H1B8120E8D8684149877273C5C4E6DF65"><enum>(1)</enum><text>have a graduate
degree in medicine, osteopathic medicine, or another health profession from an
accredited (as determined by the Secretary of Health and Human Services)
institution of higher education; and</text>
</paragraph><paragraph id="HF7E80C2B93F149C0947A1A5A8AF96E56"><enum>(2)</enum><text>have practiced as
a primary care provider for a period (excluding any residency or fellowship
training period) of not less than—</text>
<subparagraph id="HA7B99FCA18614D41BAFFE00BB663CCED"><enum>(A)</enum><text>5 years; or</text>
</subparagraph><subparagraph id="H14C7806E8CF74FA985DC4BB0DE69D16C"><enum>(B)</enum><text>3 years in a
medically underserved community (as defined in section 799B of the Public
Health Service Act (42 U.S.C. 295p)).</text>
</subparagraph></paragraph></subsection><subsection id="HC3297EB231FB416DA7BA93AEED4070EC"><enum>(c)</enum><header>Installments</header><text>Payments
under this section may be made in installments of not more than $10,000 for
each year of service described in subsection (a)(1).</text>
</subsection><subsection commented="no" id="HE2BCDB3DD4C449EC9EE42AA47891B303"><enum>(d)</enum><header>Applicability of
certain provisions</header><text display-inline="yes-display-inline">The
provisions of subpart III of part D of title III of the Public Health Service
Act shall, except as inconsistent with this section, apply to the program
established under this section in the same manner and to the same extent as
such provisions apply to the National Health Service Corps Loan Repayment
Program established in such subpart.</text>
</subsection></section></subtitle><enum>XII</enum><header>Offsets</header>
<subtitle id="H8BF4DDC7A1E34A84B0BFDE0EDF1992F5"><enum>A</enum><header>Enforcing
discretionary spending limits</header>
<section id="H17A6EBC2B084430687B7157A64F87D78"><enum>1201.</enum><header>Enforcing
discretionary spending limits</header>
<subsection id="H6B756611AFB34DD78D6C9A17BE3FC835"><enum>(a)</enum><header>Discretionary
Spending Limits</header><text>Sections 251(b) and (c) of the Balanced Budget
and Emergency Deficit Control of Act of 1985 are amended to read as
follows:</text>
<quoted-block id="H50DB1C19DB4C49728EBC1B67DA54316D" style="OLC">
<subsection commented="no" id="HCCFCD2B13BB64DBC8583FF0EDDDC46F9"><enum>(b)</enum><header>Discretionary
Spending Limit</header><text>As used in this part, the term <term>discretionary
spending limit</term> means—</text>
<paragraph commented="no" id="HF820C629CF9F4FB2A1C41FE4DD23EEDB"><enum>(1)</enum><text display-inline="yes-display-inline">with respect to fiscal year 2010,
$1,173,000,000,000 in new budget authority of which no more than
$481,140,000,000 shall be for the nondefense category;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="HD1BFF188475544AA97EB5A6E9B143E36"><enum>(2)</enum><text display-inline="yes-display-inline">with respect to fiscal year 2011,
$1,096,439,000,000 in new budget authority of which no more than
$476,329,000,000 shall be for the nondefense category;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="HE5CADA6290A74715AC5963E7464CFC17"><enum>(3)</enum><text display-inline="yes-display-inline">with respect to fiscal year 2012,
$1,100,705,000 in new budget authority of which no more than $471,565,000,000
shall be for the nondefense category;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H6F018ACDCBFC42F0962494C42F4B6DA3"><enum>(4)</enum><text display-inline="yes-display-inline">with respect to fiscal year 2013,
$1,106,750,000,000 in new budget authority of which no more than
$466,850,000,000 shall be for the nondefense category;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H14BD0A2EC088444D8C29EB8F9AEFC107"><enum>(5)</enum><text display-inline="yes-display-inline">with respect to fiscal year 2014,
$1,116,011,000,000 in new budget authority of which no more than
$462,181,000,000 shall be for the nondefense category;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="HE92228AEA2CD4961913AAE2DD8C76E69"><enum>(6)</enum><text display-inline="yes-display-inline">with respect to fiscal year 2015,
$1,117,559,000,000 in new budget authority of which no more than
$457,559,000,000 shall be for the nondefense category;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H44C671C7DAA34373AD9BE69BD30B8686"><enum>(7)</enum><text display-inline="yes-display-inline">with respect to fiscal year 2016,
$1,117,984,000,000 in new budget authority of which no more than
$452,984,000,000 shall be for the nondefense category;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H74B2BB886D1640878353F0D9D4F241C8"><enum>(8)</enum><text display-inline="yes-display-inline">with respect to fiscal year 2017,
$1,118,454,000,000 in new budget authority of which no more than
$448,454,000,000 shall be for the nondefense category;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H0FAEBC126C884F8F9844C2EAB8F338AF"><enum>(9)</enum><text display-inline="yes-display-inline">with respect to fiscal year 2018,
$1,118,969,000,000 in new budget authority of which no more than
443,969,000,000 shall be for the nondefense category; and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H80B613EC402249A9BB2E5031DDCC07DE"><enum>(10)</enum><text display-inline="yes-display-inline">with respect to fiscal year 2019,
$1,127,530,000,000 in new budget authority of which no more than
$439,530,000,000 shall be for the nondefense
category.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H7F2A29CDB45C4D389323B6C6072161EE"><enum>(b)</enum><header>Discretionary
Spending Limit Point of Order</header><text>Section 312 of the Congressional
Budget Act of 1974 (as amended by section 214(a)) is further amended by adding
at the end the following new subsection:</text>
<quoted-block id="H6DD714A2A06549D59E03C8569DC78D56" style="OLC">
<subsection id="HAEDE70C5737E42DFAE58999D1975847A"><enum>(h)</enum><header>Discretionary
Spending Limit Point of Order</header><text>It shall not be in order in the
House of Representatives or the Senate to consider any bill, joint resolution,
amendment, or conference report that—</text>
<paragraph id="H0ABCBE6F68694291A29879858F04D166"><enum>(1)</enum><text>increases the
discretionary spending limits for any ensuing fiscal year after the budget
year; or</text>
</paragraph><paragraph id="H448E3B90FA7B4F3DB15E94C2DC7712F8"><enum>(2)</enum><text>would cause the
discretionary spending limits for the budget year to be
breached.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H9B00AE56DB104A3999210A5253BA0792"><enum>(c)</enum><header>Advance
Appropriation Point of Order</header><text>Section 312 of the Congressional
Budget Act of 1974 (as amended by this section) is further amended by adding at
the end the following new subsection:</text>
<quoted-block id="HC9FADE8ACA9F48D082F2FA05E65B95A1" style="OLC">
<subsection id="H33C19678BA954B0AAC25A4ACC6BD4E57"><enum>(i)</enum><header>Advance
Appropriation Point of Order</header><text>It shall not be in order in the
House of Representatives or the Senate to consider any appropriation bill or
joint resolution, or amendment thereto or conference report thereon, that
provides advance discretionary new budget authority that first becomes
available for any fiscal year after the budget year at an amount for any
program, project, or activity above the amount of appropriations for fiscal
year 2007 for such program, project, or
activity.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section></subtitle><subtitle id="H3FE0560B4FDC4149A51B43D1B3A20E18"><enum>B</enum><header>Repeal of unused
stimulus funds</header>
<section id="H06F6EEE085E2457DBC67E47D70862A19"><enum>1211.</enum><header>Rescission and
repeal in ARRA</header>
<subsection id="HB28420A795644044A2C683C8496B4122"><enum>(a)</enum><header>Rescission</header><text display-inline="yes-display-inline">Of the discretionary appropriations made
available in division A of the American Recovery and Reinvestment Act of 2009
(Public Law 111–5), all unobligated balances are rescinded.</text>
</subsection><subsection id="HA1CBBAC60C4E4D36835A2482D6153318"><enum>(b)</enum><header>Repeal</header><text display-inline="yes-display-inline">Subtitles B and C of title II and titles
III through VII of division B of the American Recovery and Reinvestment Act of
2009 (Public Law 111–5) are repealed.</text>
</subsection></section></subtitle><subtitle id="HC3992ACF3A2C429896D10358EA320067"><enum>C</enum><header>Savings from
health care efficiencies</header>
<section display-inline="no-display-inline" id="HDEADA7E66D73422B9794E68D3BD813B6" section-type="subsequent-section"><enum>1221.</enum><header>Medicare DSH report
and payment adjustments in response to coverage expansion</header>
<subsection id="H5E1BDC4955964318A90667C70E83339F"><enum>(a)</enum><header>DSH
report</header>
<paragraph id="H16227BCC801B42D989BA0BE3061AA56B"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">Not later than
January 1, 2014, the Secretary of Health and Human Services shall submit to
Congress a report on Medicare DSH taking into account the impact of the health
care reforms carried out under this Act in reducing the number of uninsured
individuals. The report shall include recommendations relating to the
following:</text>
<subparagraph id="H42F3492FE4034AE8B4ADA1A48A97D240"><enum>(A)</enum><text>The appropriate
amount, targeting, and distribution of Medicare DSH to compensate for higher
Medicare costs associated with serving low-income beneficiaries (taking into
account variations in the empirical justification for Medicare DSH attributable
to hospital characteristics, including bed size), consistent with the original
intent of Medicare DSH.</text>
</subparagraph><subparagraph id="HF4E8DE9DD39D44FA95C815D93FE6EA45"><enum>(B)</enum><text>The appropriate
amount, targeting, and distribution of Medicare DSH to hospitals given their
continued uncompensated care costs, to the extent such costs remain.</text>
</subparagraph></paragraph><paragraph id="H996D99BAD2A244A4BA2E42A62B4196AB"><enum>(2)</enum><header>Coordination
with Medicaid DSH report</header><text>The Secretary shall coordinate the
report under this subsection with the report on Medicaid DSH under section
1222(a).</text>
</paragraph></subsection><subsection id="HEF97EEEA71084805A7F8FD02C9E42975"><enum>(b)</enum><header>Payment
adjustments in response to coverage expansion</header>
<paragraph id="H79D4B1402D2D4F2A9FC3B38FC26EFFED"><enum>(1)</enum><header>In
general</header><text>If there is a significant decrease in the national rate
of uninsurance as a result of this Act (as determined under paragraph (2)(A)),
then the Secretary of Health and Human Services shall, beginning in fiscal year
2015, implement the following adjustments to Medicare DSH:</text>
<subparagraph id="H33141B7803D6438A8B54B48F5177FCA8"><enum>(A)</enum><text display-inline="yes-display-inline">In lieu of the amount of Medicare DSH
payment that would otherwise be made under section 1886(d)(5)(F) of the Social
Security Act, the amount of Medicare DSH payment shall be an amount based on
the recommendations of the report under subsection (a)(1)(A) and shall take
into account variations in the empirical justification for Medicare DSH
attributable to hospital characteristics, including bed size.</text>
</subparagraph><subparagraph id="H2FE6DB2ED69D4B5C853903F2B9D15164"><enum>(B)</enum><text display-inline="yes-display-inline">Subject to paragraph (3), make an
additional payment to a hospital by an amount that is estimated based on the
amount of uncompensated care provided by the hospital based on criteria for
uncompensated care as determined by the Secretary, which shall exclude bad
debt.</text>
</subparagraph></paragraph><paragraph id="HA46BED218AED4169990C0F3B43E5F875"><enum>(2)</enum><header>Significant
decrease in national rate of uninsurance as a result of this Act</header><text display-inline="yes-display-inline">For purposes of this subsection—</text>
<subparagraph id="H5287684C6037410387002454DC8EC815"><enum>(A)</enum><header>In
general</header><text>There is a <quote>significant decrease in the national
rate of uninsurance as a result of this Act</quote> if there is a decrease in
the national rate of uninsurance (as defined in subparagraph (B)) from 2010 to
2012 that exceeds 8 percentage points.</text>
</subparagraph><subparagraph id="H9C9EA42E4C2147BBB00C72A36D38742D"><enum>(B)</enum><header>National rate of
uninsurance defined</header><text>The term <term>national rate of
uninsurance</term> means, for a year, such rate for the under-65 population for
the year as determined and published by the Bureau of the Census in its Current
Population Survey in or about September of the succeeding year.</text>
</subparagraph></paragraph><paragraph id="H66AA548ABEA74927AB67DF0A7F0EE56C"><enum>(3)</enum><header>Uncompensated
care increase</header>
<subparagraph id="H6903104EEAB6425FA5ABC83C9A52ABA1"><enum>(A)</enum><header>Computation of
DSH savings</header><text display-inline="yes-display-inline">For each fiscal
year (beginning with fiscal year 2015), the Secretary shall estimate the
aggregate reduction in Medicare DSH that will result from the adjustment under
paragraph (1)(A).</text>
</subparagraph><subparagraph id="HC99DD40D263748C6A29217D89B1B69E4"><enum>(B)</enum><header>Structure of
payment increase</header><text display-inline="yes-display-inline">The
Secretary shall compute the increase in Medicare DSH under paragraph (1)(B) for
a fiscal year in accordance with a formula established by the Secretary that
provides that—</text>
<clause id="HBD7A1A711442451FB18B62C6E5438361"><enum>(i)</enum><text>the
aggregate amount of such increase for the fiscal year does not exceed 50
percent of the aggregate reduction in Medicare DSH estimated by the Secretary
for such fiscal year; and</text>
</clause><clause id="H3F8B23A873DD4A29A8ED0593371FCADF"><enum>(ii)</enum><text>hospitals with
higher levels of uncompensated care receive a greater increase.</text>
</clause></subparagraph></paragraph></subsection><subsection id="H6A7D82C94D774929818A4E2B4E98AD11"><enum>(c)</enum><header>Medicare
DSH</header><text>In this section, the term <term>Medicare DSH</term> means
adjustments in payments under section 1886(d)(5)(F) of the Social Security Act
(42 U.S.C. 1395ww(d)(5)(F)) for inpatient hospital services furnished by
disproportionate share hospitals.</text>
</subsection></section><section display-inline="no-display-inline" id="HC67F050C00DC494E950EC298F961EAB1" section-type="subsequent-section"><enum>1222.</enum><header>Reduction in
Medicaid DSH</header>
<subsection id="H40C5D66D362B446E8E7E6696DCD4D56E"><enum>(a)</enum><header>Report</header>
<paragraph id="HC26814C2FDE54162921E17B534712A17"><enum>(1)</enum><header>In
general</header><text>Not later than January 1, 2014, the Secretary of Health
and Human Services (in this title referred to as the <quote>Secretary</quote>)
shall submit to Congress a report concerning the extent to which, based upon
the impact of the health care reforms carried out under this Act in reducing
the number of uninsured individuals, there is a continued role for Medicaid
DSH. In preparing the report, the Secretary shall consult with community-based
health care networks serving low-income beneficiaries.</text>
</paragraph><paragraph id="H7E04C06E5A204F7C867C90B2AA111F4C"><enum>(2)</enum><header>Matters to be
included</header><text>The report shall include the following:</text>
<subparagraph id="H23F4872C81644921A20E0CEA2A6172DA"><enum>(A)</enum><header>Recommendations</header><text>Recommendations
regarding—</text>
<clause id="HCBE1BCB9F38449039FFFEA68113AF377"><enum>(i)</enum><text display-inline="yes-display-inline">the appropriate targeting of Medicaid DSH
within States; and</text>
</clause><clause id="HCE8BDBD2100B4EFEA5FCC84FDCC5E75F"><enum>(ii)</enum><text display-inline="yes-display-inline">the distribution of Medicaid DSH among the
States.</text>
</clause></subparagraph><subparagraph id="HD4A3570E29144302B52197E2E53093B7"><enum>(B)</enum><header>Specification of
DSH Health Reform methodology</header><text>The DSH Health Reform methodology
described in paragraph (2) of subsection (b) for purposes of implementing the
requirements of such subsection.</text>
</subparagraph></paragraph><paragraph id="H1E4525A2A057403C8E209425ABED65F3"><enum>(3)</enum><header>Coordination
with Medicare DSH report</header><text>The Secretary shall coordinate the
report under this subsection with the report on Medicare DSH under section
1221.</text>
</paragraph><paragraph id="HAF80AC7A82E24F9D9FFB40E410C6A8AF"><enum>(4)</enum><header>Medicaid
DSH</header><text>In this section, the term <term>Medicaid DSH</term> means
adjustments in payments under section 1923 of the Social Security Act for
inpatient hospital services furnished by disproportionate share
hospitals.</text>
</paragraph></subsection><subsection id="HB65D27FA2D154449B76ADDF6E652D16D"><enum>(b)</enum><header>Medicaid DSH
reductions</header>
<paragraph id="HF6F78DD14D084525BD62D3C2787354EB"><enum>(1)</enum><header>In
general</header><text>If there is a significant decrease in the national rate
of uninsurance as a result of this Act (as determined under section
1221(a)(2)(A)), then the Secretary of Health and Human Services shall reduce
Medicaid DSH so as to reduce total Federal payments to all States for such
purpose by $1,500,000,000 in fiscal year 2015, $2,500,000,000 in fiscal year
2016, and $6,000,000,000 in fiscal year 2017.</text>
</paragraph><paragraph id="HE1DD1BA8C4B143B8961D75716288CFEC"><enum>(2)</enum><header>DSH Health
Reform methodology</header><text>The Secretary shall carry out paragraph (1)
through use of a DSH Health Reform methodology issued by the Secretary that
imposes the largest percentage reductions on the States that—</text>
<subparagraph id="HA88D20C90C1740F0A8B8A5FBD512731F"><enum>(A)</enum><text>have the lowest
percentages of uninsured individuals (determined on the basis of audited
hospital cost reports) during the most recent year for which such data are
available; or</text>
</subparagraph><subparagraph id="H2A96E4E93FF24D0E9FC0837DBD913C71"><enum>(B)</enum><text>do not target
their DSH payments on—</text>
<clause id="H0480D5C176FC408587C0BC5D48C22079"><enum>(i)</enum><text>hospitals with
high volumes of Medicaid inpatients (as defined in section 1923(b)(1)(A) of the
Social Security Act (42 U.S.C. 1396r–4(b)(1)(A)); and</text>
</clause><clause id="H719BFC994A4B4610BB46D952D9AF6761"><enum>(ii)</enum><text display-inline="yes-display-inline">hospitals that have high levels of
uncompensated care (excluding bad debt).</text>
</clause></subparagraph></paragraph><paragraph id="H65363883A01E48B09996797C3E31C8DA"><enum>(3)</enum><header>DSH allotment
publications</header>
<subparagraph id="H75830BF3CBFA4E64BD80EB7F09BF0590"><enum>(A)</enum><header>In
general</header><text>Not later than the publication deadline specified in
subparagraph (B), the Secretary shall publish in the Federal Register a notice
specifying the DSH allotment to each State under 1923(f) of the Social Security
Act for the respective fiscal year specified in such subparagraph, consistent
with the application of the DSH Health Reform methodology described in
paragraph (2).</text>
</subparagraph><subparagraph id="HE22B992A917D4B9180908A73A417DE1F"><enum>(B)</enum><header>Publication
deadline</header><text>The publication deadline specified in this subparagraph
is—</text>
<clause id="H6A60820001924E2A96B57CCF94625911"><enum>(i)</enum><text>January 1, 2014,
with respect to DSH allotments described in subparagraph (A) for fiscal year
2015;</text>
</clause><clause id="HC2E64AB799564B37AEF3A194CFEAC006"><enum>(ii)</enum><text display-inline="yes-display-inline">January 1, 2015, with respect to DSH
allotments described in subparagraph (A) for fiscal year 2016; and</text>
</clause><clause id="H0CDBDAEF32D84F3BA093810BCC3FB96D"><enum>(iii)</enum><text display-inline="yes-display-inline">January 1, 2016, with respect to DSH
allotments described in subparagraph (A) for fiscal year 2017.</text>
</clause></subparagraph></paragraph></subsection><subsection id="HE68EBCD9413140DDA9749872F1C36E61"><enum>(c)</enum><header>Conforming
amendments</header>
<paragraph id="H0DE2F1B9167247B3B6450ECF23BDB012"><enum>(1)</enum><text>Section 1923(f) of
the Social Security Act (42 U.S.C. 1396r–4(f)) is amended—</text>
<subparagraph id="HCB2C9DD465DA463DB085B0581F67B190"><enum>(A)</enum><text>by redesignating
paragraph (7) as paragraph (8); and</text>
</subparagraph><subparagraph id="H772B65B985FE4582B4FA8A089D58A923"><enum>(B)</enum><text>by inserting after
paragraph (6) the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HACFE618875D4485284A601029331357C" style="OLC">
<paragraph id="H61323F7EEED0413DB85B4FD8299C51F1"><enum>(7)</enum><header>Special rule for
fiscal years 2015, 2016, and 2017</header><text>Notwithstanding paragraph (2),
if the Secretary makes a reduction under section 1222(b)(1) of the
<short-title>Siding with America’s Patients
Act</short-title>, the total DSH allotments for all States for—</text>
<subparagraph id="HA74B03EF27124A3BBA1C336B988010AB"><enum>(A)</enum><text>fiscal year 2015,
shall be the total DSH allotments that would otherwise be determined under this
subsection for such fiscal year decreased by $1,500,000,000;</text>
</subparagraph><subparagraph id="HB34E83FDBD574CCE8FC2FEAD397B397A"><enum>(B)</enum><text display-inline="yes-display-inline">fiscal year 2016, shall be the total DSH
allotments that would otherwise be determined under this subsection for such
fiscal year decreased by $2,500,000,000; and</text>
</subparagraph><subparagraph id="H8F0F24F839494047A4859F11BDDEC3D3"><enum>(C)</enum><text>fiscal year 2017,
shall be the total DSH allotments that would otherwise be determined under this
subsection for such fiscal year decreased by
$6,000,000,000.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="HF098A52A05744757B52EFEAA07BB34F1"><enum>(2)</enum><text>Section 1923(b)(4)
of such Act (42 U.S.C. 1396r–4(b)(4)) is amended by adding before the period
the following: <quote>or to affect the authority of the Secretary to issue and
implement the DSH Health Reform methodology under section 1704(b)(2) of the
<short-title>Siding with America’s Patients
Act</short-title></quote>.</text>
</paragraph></subsection><subsection id="HB6330381D270412F8A66EA0A354BD1A4"><enum>(d)</enum><header>Disproportionate
share hospitals (DSH) and essential access hospital (EAH)
non-Discrimination</header>
<paragraph id="H40AB4A0C04CF40A9BDBEAD05FEC2918D"><enum>(1)</enum><header>In
general</header><text>Section 1923(d) of the Social Security Act (42 U.S.C.
1396r–4) is amended by adding at the end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HB5552A58B3F94BEBBADB705B7D0CB329" style="OLC">
<paragraph id="H9CB628747B794146BC97C486373C1D77"><enum>(4)</enum><text display-inline="yes-display-inline">No hospital may be defined or deemed as a
disproportionate share hospital, or as an essential access hospital (for
purposes of subsection (f)(6)(A)(iv), under a State plan under this title or
subsection (b) of this section (including any waiver under section 1115) unless
the hospital—</text>
<subparagraph id="HA6DDFB4643B941B48EA396944893D869"><enum>(A)</enum><text>provides services
to beneficiaries under this title without discrimination on the ground of race,
color, national origin, creed, source of payment, status as a beneficiary under
this title, or any other ground unrelated to such beneficiary’s need for the
services or the availability of the needed services in the hospital; and</text>
</subparagraph><subparagraph id="H2EC77DE1DCBE4CA3BAFECD3A7E66D7B8"><enum>(B)</enum><text>makes arrangements
for, and accepts, reimbursement under this title for services provided to
eligible beneficiaries under this
title.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="HBB621BA547FB4601BADE0ED19157C3FB"><enum>(2)</enum><header>Effective
date</header><text>The amendment made by subsection (a) shall be apply to
expenditures made on or after July 1, 2010.</text>
</paragraph></subsection></section></subtitle><subtitle id="HB75903EE67E04897BF055E4EE8B28975"><enum>D</enum><header>Fraud, Waste, and
Abuse</header>
<section id="H8E4E280845CA4531A7B6E602B67F953D"><enum>1231.</enum><header>Provide
adequate funding to HHS OIG and HCFAC</header>
<subsection id="H0F72523A056D44D991A8580F1B1CAB55"><enum>(a)</enum><header>HCFAC
funding</header><text display-inline="yes-display-inline">Section 1817(k)(3)(A)
of the Social Security Act (42 U.S.C. 1395i(k)(3)(A)) is amended—</text>
<paragraph id="H5C98EA6B6F734D2794BF0DB0059C6CF7"><enum>(1)</enum><text>in clause
(i)—</text>
<subparagraph id="HAA891E7F3F9842D79D20408A8D10EDC8"><enum>(A)</enum><text>in subclause (IV),
by striking <quote>2009, and 2010</quote> and inserting <quote>and
2009</quote>; and</text>
</subparagraph><subparagraph id="H8DC8D6D2DE26445BB97C7D35F3155283"><enum>(B)</enum><text>by amending
subclause (V) to read as follows:</text>
<quoted-block display-inline="no-display-inline" id="H627D79703BDF43E9AA9F99B04820F50A" style="OLC">
<subclause id="HFC0C074E20E64DAEB87320B204DE84C9"><enum>(V)</enum><text display-inline="yes-display-inline">for each fiscal year after fiscal year
2009, $300,000,000.</text>
</subclause><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="H86DAEFCDAC174F2497D30BDA6176D01E"><enum>(2)</enum><text>in clause
(ii)—</text>
<subparagraph id="H4B1E8C09E4D64FBEBD6957267D185E6F"><enum>(A)</enum><text>in subclause (IX),
by striking <quote>2009, and 2010</quote> and inserting <quote>and
2009</quote>; and</text>
</subparagraph><subparagraph id="H9A55708DAE5F43158BE9515C8321FC10"><enum>(B)</enum><text>in subclause (X),
by striking <quote>2010</quote> and inserting <quote>2009</quote> and by
inserting before the period at the end the following: <quote>, plus the amount
by which the amount made available under clause (i)(V) for fiscal year 2010
exceeds the amount made available under clause (i)(IV) for 2009</quote>.</text>
</subparagraph></paragraph></subsection><subsection id="H276F2C7037D644B0B82A76EFC8BA12A5"><enum>(b)</enum><header>OIG
funding</header><text display-inline="yes-display-inline">There are authorized
to be appropriated for each of fiscal years 2010 through 2019 $100,000,000 for
the Office of the Inspector General of the Department of Health and Human
Services for fraud prevention activities under the Medicare and Medicaid
programs.</text>
</subsection></section><section id="HE28AC4818E144BC1AA2D71A0A20D79A4"><enum>1232.</enum><header>Improved
enforcement of the Medicare secondary payor provisions</header>
<subsection id="H72EFDF701D474050AF59754D044C829C"><enum>(a)</enum><header>In
general</header><text>The Secretary, in coordination with the Inspector General
of the Department of Health and Human Services, shall provide through the
Coordination of Benefits Contractor for the identification of instances where
the Medicare program should be, but is not, acting as a secondary payer to an
individual’s private health benefits coverage under section 1862(b) of the
Social Security Act (42 U.S.C. 1395y(b)).</text>
</subsection><subsection id="H2B4DAAD86D5A47E993F46C9488037FFB"><enum>(b)</enum><header>Updating
procedures</header><text>The Secretary shall update procedures for identifying
and resolving credit balance situations which occur under the Medicare program
when payment under such title and from other health benefit plans exceed the
providers’ charges or the allowed amount.</text>
</subsection><subsection id="H762202D168AC460DB2BD90F7DC0B923F"><enum>(c)</enum><header>Report on
improved enforcement</header><text>Not later than 1 year after the date of the
enactment of this Act, the Secretary shall submit a report to Congress on
progress made in improved enforcement of the Medicare secondary payor
provisions, including recoupment of credit balances.</text>
</subsection></section><section id="H7B0A8E90ADB548B8B7678D2ED4896349"><enum>1233.</enum><header>Strengthen
Medicare provider enrollment standards and safeguards</header>
<subsection id="H8A32DBCEC1E44CEBB676FD2CBACDC8CB"><enum>(a)</enum><header>Strengthening
Medicare provider numbers</header>
<paragraph id="H14469613716D45E39DA21710FFA923E3"><enum>(1)</enum><header>Screening new
providers</header><text display-inline="yes-display-inline">As a condition of a
provider of services or a supplier, including durable medical equipment
suppliers and home health agencies, applying for the first time for a provider
number under the Medicare program and before granting billing privileges under
such title, the Secretary shall screen the provider or supplier for a criminal
background or other financial or operational irregularities through
fingerprinting, licensure checks, site-visits, other database checks.</text>
</paragraph><paragraph id="H66EAC6AC63084400A9B95A539EC81617"><enum>(2)</enum><header>Application
fees</header><text>The Secretary shall impose an application charge on such a
provider or supplier in order to cover the Secretary’s costs in performing the
screening required under paragraph (1).</text>
</paragraph><paragraph id="H043B588BE2784CF6AB461DD8463A9FB9"><enum>(3)</enum><header>Provisional
approval</header><text display-inline="yes-display-inline">During an initial,
provisional period (specified by the Secretary) In which such a provider or
supplier has been issued such a number, the Secretary shall provide enhanced
oversight of the activities of such provider or supplier under the Medicare
program, such as through prepayment review and payment limitations.</text>
</paragraph><paragraph id="HB3AF03390D9F46B5A431C7A460586E22"><enum>(4)</enum><header>Penalties for
false statements</header><text>In the case of a provider or supplier that
knowingly makes a false statement in an application for such a number, the
Secretary may exclude the provider or supplier from participation under the
Medicare program, or may impose a civil money penalty (in the amount described
in section 1128A(a)(4) of the Social Security Act) , in the same manner as the
Secretary may impose such an exclusion or penalty under sections 1128 and
1128A, respectively, of such Act in the case of knowing presentation of a false
claim described in section 1128A(a)(1)(A) of such Act.</text>
</paragraph><paragraph id="H6A07DA47C1FA40188A5B45ACC009F4C6"><enum>(5)</enum><header>Disclosure
requirements</header><text>With respect to approval of such an application, the
Secretary—</text>
<subparagraph id="HDB904C002F9D4DB3B2BD42097F7DC095"><enum>(A)</enum><text>shall require
applicants to disclose previous affiliation with enrolled entities that have
uncollected debt related to the Medicare or Medicaid programs;</text>
</subparagraph><subparagraph id="H34A0CD80E3C947448DB8C8E0644B8050"><enum>(B)</enum><text>may deny approval
if the Secretary determines that these affiliations pose undue risk to the
Medicare or Medicaid program, subject to an appeals process for the applicant
as determined by the Secretary; and</text>
</subparagraph><subparagraph id="HB05E2A84A9E44E3DA39901BABEDAED5F"><enum>(C)</enum><text>may implement
enhanced safeguards (such as surety bonds).</text>
</subparagraph></paragraph></subsection><subsection id="H9FD466BF93D0445D8470CF12980CE5FB"><enum>(b)</enum><header>Moratoria</header><text display-inline="yes-display-inline">The Secretary may impose moratoria on
approval of provider and supplier numbers under the Medicare program for new
providers of services and suppliers as determined necessary to prevent or
combat fraud a period of delay for any one applicant cannot exceed 30 days
unless cause is shown by the Secretary.</text>
</subsection><subsection id="H41E9164595504F08ADBB9C2A7BEBE997"><enum>(c)</enum><header>Funding</header><text>There
are authorized to be appropriated to carry out this section such sums as may be
necessary.</text>
</subsection></section><section id="H53E84FC43639401692BB197619A1FE93"><enum>1234.</enum><header>Tracking
banned providers across State lines</header>
<subsection id="H4026275797F9485E88D4400694525DDA"><enum>(a)</enum><header>Greater
coordination</header><text>The Secretary shall provide for increased
coordination between the Administrator of the Centers for Medicare &
Medicaid Services (in this section referred to as <quote>CMS</quote>) and its
regional offices to ensure that providers of services and suppliers that have
operated in one State and are excluded from participation in the Medicare
program are unable to begin operation and participation in the Medicare program
in another State.</text>
</subsection><subsection id="H71192314EA4147BD949BAD9787CE248D"><enum>(b)</enum><header>Improved
information systems</header>
<paragraph id="H169A469BF43F4706B8C49E4EF99484B6"><enum>(1)</enum><header>In
general</header><text>The Secretary shall improve information systems to allow
greater integration between databases under the Medicare program so
that—</text>
<subparagraph id="HD2989DC8EE4E47639A7163A20E9D1CC1"><enum>(A)</enum><text>medicare
administrative contractors, fiscal intermediaries, and carriers have immediate
access to information identifying providers and suppliers excluded from
participation in the Medicare and Medicaid program and other Federal health
care programs; and</text>
</subparagraph><subparagraph id="HD42B4DA911524FB5B3D7A400F2DC2F6A"><enum>(B)</enum><text>such information
can be shared across Federal health care programs and agencies, including
between the Departments of Health and Human Services, the Social Security
Administration, the Department of Veterans Affairs, the Department of Defense,
the Department of Justice, and the Office of Personnel Management.</text>
</subparagraph></paragraph></subsection><subsection id="H6EC5B2CB0B2E4D5DA692FA42CFA52953"><enum>(c)</enum><header>Medicare/Medicaid
<quote>One PI</quote> database</header><text>The Secretary shall implement a
database that includes claims and payment data for all components of the
Medicare program and the Medicaid program.</text>
</subsection><subsection id="H7CD6C34AD1EB47FBB880741833A323E9"><enum>(d)</enum><header>Authorizing
expanded data matching</header><text>Notwithstanding any provision of the
Computer Matching and Privacy Protection Act of 1988 to the contrary—</text>
<paragraph id="HBEC0EB1215C248B4A98AE2256F7AF4C8"><enum>(1)</enum><text>the Secretary and
the Inspector General in the Department of Health and Human Services may
perform data matching of data from the Medicare program with data from the
Medicaid program; and</text>
</paragraph><paragraph id="HFABF84F5161F471E8B8D7E3AB034F315"><enum>(2)</enum><text>the Commissioner
of Social Security and the Secretary may perform data matching of data of the
Social Security Administration with data from the Medicare and Medicaid
programs.</text>
</paragraph></subsection><subsection id="H22E9FC917B774047A9D81E7046365B6D"><enum>(e)</enum><header>Consolidation of
data bases</header><text>The Secretary shall consolidate and expand into a
centralized data base for individuals and entities that have been excluded from
Federal health care programs the Healthcare Integrity and Protection Data Bank,
the National Practitioner Data Bank, the List of Excluded Individuals/Entities,
and a national patient abuse/neglect registry.</text>
</subsection><subsection id="H477E7A6B157241A9B506FEE22F6D6262"><enum>(f)</enum><header>Comprehensive
provider database</header>
<paragraph id="H7C6A0354ED6F4DE39803C0CCE2DAFE1B"><enum>(1)</enum><header>Establishment</header><text>The
Secretary shall establish a comprehensive database that includes information on
providers of services, suppliers, and related entities participating in the
Medicare program, the Medicaid program, or both. Such database shall include,
information on ownership and business relationships, history of adverse
actions, results of site visits or other monitoring by any program.</text>
</paragraph><paragraph id="H878FD8E17A9B43EA9B6EB77E0749FF61"><enum>(2)</enum><header>Use</header><text>Prior
to issuing a provider or supplier number for an entity under the Medicare
program, the Secretary shall obtain information on the entity from such
database to assure the entity qualifies for the issuance of such a
number.</text>
</paragraph></subsection><subsection id="H12367556E4394A71A3D49A0FAADAD4B9"><enum>(g)</enum><header>Comprehensive
sanctions database</header><text>The Secretary shall establish a comprehensive
sanctions database on sanctions imposed on providers of services, suppliers,
and related entities. Such database shall be overseen by the Inspector General
of the Department of Health and Human Services and shall be linked to related
databases maintained by State licensure boards and by Federal or State law
enforcement agencies.</text>
</subsection><subsection id="H182CB8E602D741FE9D279EFA624F99C7"><enum>(h)</enum><header>Access to claims
and payment databases</header><text>The Secretary shall ensure that the
Inspector General of the Department of Health and Human Services and Federal
law enforcement agencies have direct access to all claims and payment databases
of the Secretary under the Medicare or Medicaid programs.</text>
</subsection><subsection id="H1005F1AC224A4D5B8908DA35CCB57671"><enum>(i)</enum><header>Civil money
penalties for submission of erroneous information</header><text display-inline="yes-display-inline">In the case of a provider of services,
supplier, or other entity that knowingly submits erroneous information that
serves as a basis for payment of any entity under the Medicare or Medicaid
program, the Secretary may impose a civil money penalty of not to exceed
$50,000 for each such erroneous submission. A civil money penalty under this
subsection shall be imposed and collected in the same manner as a civil money
penalty under subsection (a) of section 1128A of the Social Security Act is
imposed and collected under that section.</text>
</subsection></section><section id="HA9C5A931DD20412D9DB4BEFF4DE31260"><enum>1235.</enum><header>Reinstate the
Medicare trigger</header><text display-inline="no-display-inline">Section 3 of
House Resolution 5 of the One Hundred Eleventh Congress is amended by striking
subsection (e) (relating to Medicare cost containment).</text>
</section></subtitle>