[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[H.R. 191 Introduced in House (IH)]
112th CONGRESS
1st Session
H. R. 191
To amend the Patient Protection and Affordable Care Act to establish a
public health insurance option.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
January 5, 2011
Ms. Woolsey (for herself, Mr. George Miller of California, Ms.
Schakowsky, Mr. Conyers, Mr. Stark, Mr. Olver, Ms. Lee of California,
Ms. Moore, Mr. Frank of Massachusetts, Mr. Engel, Mr. Johnson of
Georgia, Ms. Edwards, Mr. Hinchey, Ms. Zoe Lofgren of California, Mr.
Honda, Mr. Ackerman, Mr. Murphy of Connecticut, Mr. Weiner, Mr.
Ellison, Mr. Capuano, Ms. Matsui, Mr. Garamendi, Mr. Rothman of New
Jersey, Ms. DeLauro, Mr. Sarbanes, Ms. Hirono, Mr. Fattah, Mr. Scott of
Virginia, Ms. Richardson, Mr. Nadler, Mr. Farr, Ms. Pingree of Maine,
Mr. Filner, Mr. Hastings of Florida, Ms. Jackson Lee of Texas, Mr. Ryan
of Ohio, Ms. Baldwin, Mr. Tonko, Ms. Slaughter, Mr. Gutierrez, Mr.
Holt, Mr. Grijalva, Ms. Tsongas, Mr. Lujan, Mr. Higgins, Mr. Thompson
of California, and Mr. Cohen) introduced the following bill; which was
referred to the Committee on Energy and Commerce
_______________________________________________________________________
A BILL
To amend the Patient Protection and Affordable Care Act to establish a
public health insurance option.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Public Option Deficit Reduction
Act''.
SEC. 2. PUBLIC HEALTH INSURANCE OPTION.
(a) In General.--Part III of subtitle D of title I of the Patient
Protection and Affordable Care Act (Public Law 111-148) is amended by
adding at the end the following new section:
``SEC. 1325. PUBLIC HEALTH INSURANCE OPTION.
``(a) Establishment and Administration of a Public Health Insurance
Option.--
``(1) Establishment.--For years beginning with 2014, the
Secretary of Health and Human Services (in this subtitle
referred to as the `Secretary') shall provide for the offering
through Exchanges established under this title of a health
benefits plan (in this Act referred to as the `public health
insurance option') that ensures choice, competition, and
stability of affordable, high-quality coverage throughout the
United States in accordance with this section. In designing the
option, the Secretary's primary responsibility is to create a
low-cost plan without compromising quality or access to care.
``(2) Offering through exchanges.--
``(A) Exclusive to exchanges.--The public health
insurance option shall only be made available through
Exchanges established under this title.
``(B) Ensuring a level playing field.--Consistent
with this section, the public health insurance option
shall comply with requirements that are applicable
under this title to health benefits plans offered
through such Exchanges, including requirements related
to benefits, benefit levels, provider networks,
notices, consumer protections, and cost sharing.
``(C) Provision of benefit levels.--The public
health insurance option--
``(i) shall offer bronze, silver, and gold
plans; and
``(ii) may offer platinum plans.
``(3) Administrative contracting.--The Secretary may enter
into contracts for the purpose of performing administrative
functions (including functions described in subsection (a)(4)
of section 1874A of the Social Security Act) with respect to
the public health insurance option in the same manner as the
Secretary may enter into contracts under subsection (a)(1) of
such section. The Secretary has the same authority with respect
to the public health insurance option as the Secretary has
under subsections (a)(1) and (b) of section 1874A of the Social
Security Act with respect to title XVIII of such Act. Contracts
under this subsection shall not involve the transfer of
insurance risk to such entity.
``(4) Ombudsman.--The Secretary shall establish an office
of the ombudsman for the public health insurance option which
shall have duties with respect to the public health insurance
option similar to the duties of the Medicare Beneficiary
Ombudsman under section 1808(c)(2) of the Social Security Act.
In addition, such office shall work with States to ensure that
information and notice is provided that the public health
insurance option is one of the health plans available through
an Exchange.
``(5) Data collection.--The Secretary shall collect such
data as may be required to establish premiums and payment rates
for the public health insurance option and for other purposes
under this section, including to improve quality and to reduce
racial, ethnic, and other disparities in health and health
care.
``(6) Access to federal courts.--The provisions of Medicare
(and related provisions of title II of the Social Security Act)
relating to access of Medicare beneficiaries to Federal courts
for the enforcement of rights under Medicare, including with
respect to amounts in controversy, shall apply to the public
health insurance option and individuals enrolled under such
option under this title in the same manner as such provisions
apply to Medicare and Medicare beneficiaries.
``(b) Premiums and Financing.--
``(1) Establishment of premiums.--
``(A) In general.--The Secretary shall establish
geographically adjusted premium rates for the public
health insurance option--
``(i) in a manner that complies with the
premium rules under paragraph (3); and
``(ii) at a level sufficient to fully
finance the costs of--
``(I) health benefits provided by
the public health insurance option; and
``(II) administrative costs related
to operating the public health
insurance option.
``(B) Contingency margin.--In establishing premium
rates under subparagraph (A), the Secretary shall
include an appropriate amount for a contingency margin.
``(2) Account.--
``(A) Establishment.--There is established in the
Treasury of the United States an account for the
receipts and disbursements attributable to the
operation of the public health insurance option,
including the start-up funding under subparagraph (B).
Section 1854(g) of the Social Security Act shall apply
to receipts described in the previous sentence in the
same manner as such section applies to payments or
premiums described in such section.
``(B) Start-up funding.--
``(i) In general.--In order to provide for
the establishment of the public health
insurance option there is hereby appropriated
to the Secretary, out of any funds in the
Treasury not otherwise appropriated,
$2,000,000,000. In order to provide for initial
claims reserves before the collection of
premiums, there is hereby appropriated to the
Secretary, out of any funds in the Treasury not
otherwise appropriated, such sums as necessary
to cover 90 days worth of claims reserves based
on projected enrollment.
``(ii) Amortization of start-up funding.--
The Secretary shall provide for the repayment
of the startup funding provided under clause
(i) to the Treasury in an amortized manner over
the 10-year period beginning with 2014.
``(iii) Limitation on funding.--Nothing in
this subsection shall be construed as
authorizing any additional appropriations to
the account, other than such amounts as are
otherwise provided with respect to other health
benefits plans participating under the Exchange
involved.
``(3) Insurance rating rules.--The premium rate charged for
the public health insurance option may not vary except as
provided under section 2701 of the Public Health Service Act.
``(c) Payment Rates for Items and Services.--
``(1) Rates established by secretary.--
``(A) In general.--The Secretary shall establish
payment rates for the public health insurance option
for services and health care providers consistent with
this subsection and may change such payment rates in
accordance with subsection (d).
``(B) Initial payment rules.--
``(i) In general.--During 2014, 2015, and
2016, the Secretary shall set the payment rates
under this subsection for services and
providers described in subparagraph (A) equal
to the payment rates for equivalent services
and providers under parts A and B of Medicare,
subject to clause (ii), paragraphs (2)(A) and
(4), and subsection (d).
``(ii) Exceptions.--
``(I) Practitioners' services.--
Payment rates for practitioners'
services otherwise established under
the fee schedule under section 1848 of
the Social Security Act shall be
applied without regard to the
provisions under subsection (f) of such
section and the update under subsection
(d)(4) under such section for a year as
applied under this paragraph shall be
not less than 1 percent.
``(II) Adjustments.--The Secretary
may determine the extent to which
Medicare adjustments applicable to base
payment rates under parts A and B of
Medicare for graduate medical education
and disproportionate share hospitals
shall apply under this section.
``(C) For new services.--The Secretary shall modify
payment rates described in subparagraph (B) in order to
accommodate payments for services, such as well-child
visits, that are not otherwise covered under Medicare.
``(D) Prescription drugs.--Payment rates under this
subsection for prescription drugs that are not paid for
under part A or part B of Medicare shall be at rates
negotiated by the Secretary.
``(2) Incentives for participating providers.--
``(A) Initial incentive period.--
``(i) In general.--The Secretary shall
provide, in the case of services described in
clause (ii) furnished during 2014, 2015, and
2016, for payment rates that are 5 percent
greater than the rates established under
paragraph (1).
``(ii) Services described.--The services
described in this clause are items and
professional services, under the public health
insurance option by a physician or other health
care practitioner who participates in both
Medicare and the public health insurance
option.
``(iii) Special rules.--A pediatrician and
any other health care practitioner who is a
type of practitioner that does not typically
participate in Medicare (as determined by the
Secretary) shall also be eligible for the
increased payment rates under clause (i).
``(B) Subsequent periods.--Beginning with 2017 and
for subsequent years, the Secretary shall continue to
use an administrative process to set such rates in
order to promote payment accuracy, to ensure adequate
beneficiary access to providers, and to promote
affordability and the efficient delivery of medical
care consistent with subsection (a)(1). Such rates
shall not be set at levels expected to increase average
medical costs per enrollee covered under the public
health insurance option beyond what would be expected
if the process under paragraph (1)(B) and subparagraph
(A) were continued, as certified by the Office of the
Actuary of the Centers for Medicare & Medicaid
Services.
``(C) Establishment of a provider network.--Health
care providers participating under Medicare are
participating providers in the public health insurance
option unless they opt out in a process established by
the Secretary.
``(3) Administrative process for setting rates.--Chapter 5
of title 5, United States Code shall apply to the process for
the initial establishment of payment rates under this
subsection but not to the specific methodology for establishing
such rates or the calculation of such rates.
``(4) Construction.--Nothing in this section shall be
construed as limiting the Secretary's authority to correct for
payments that are excessive or deficient, taking into account
the provisions of subsection (a)(1) and any appropriate
adjustments based on the demographic characteristics of
enrollees covered under the public health insurance option, but
in no case shall the correction of payments under this
paragraph result in a level of expenditures per enrollee that
exceeds the level of expenditures that would have occurred
under paragraphs (1)(B) and (2)(A), as certified by the Office
of the Actuary of the Centers for Medicare & Medicaid Services.
``(5) Construction.--Nothing in this section shall be
construed as affecting the authority of the Secretary to
establish payment rates, including payments to provide for the
more efficient delivery of services, such as the initiatives
provided for under subsection (d).
``(6) Limitations on review.--There shall be no
administrative or judicial review of a payment rate or
methodology established under this subsection or under
subsection (d).
``(d) Modernized Payment Initiatives and Delivery System Reform.--
``(1) In general.--For plan years beginning with 2014, the
Secretary may utilize innovative payment mechanisms and
policies to determine payments for items and services under the
public health insurance option. The payment mechanisms and
policies under this subsection may include patient-centered
medical home and other care management payments, accountable
care organizations, value-based purchasing, bundling of
services, differential payment rates, performance or
utilization based payments, partial capitation, and direct
contracting with providers. Payment rates under such payment
mechanisms and policies shall not be set at levels expected to
increase average medical costs per enrollee covered under the
public health insurance option beyond what would be expected if
the process under paragraphs (1)(B) and (2)(A) of subsection
(c) were continued, as certified by the Office of the Actuary
of the Centers for Medicare & Medicaid Services.
``(2) Requirements for innovative payments.--The Secretary
shall design and implement the payment mechanisms and policies
under this subsection in a manner that--
``(A) seeks to--
``(i) improve health outcomes;
``(ii) reduce health disparities (including
racial, ethnic, and other disparities);
``(iii) provide efficient and affordable
care;
``(iv) address geographic variation in the
provision of health services; or
``(v) prevent or manage chronic illness;
and
``(B) promotes care that is integrated, patient-
centered, high-quality, and efficient.
``(3) Encouraging the use of high value services.--To the
extent allowed by the benefit standards applied to all health
benefits plans participating under the Exchange involved, the
public health insurance option may modify cost sharing and
payment rates to encourage the use of services that promote
health and value.
``(4) Non-uniformity permitted.--Nothing in this subtitle
shall prevent the Secretary from varying payments based on
different payment structure models (such as accountable care
organizations and medical homes) under the public health
insurance option for different geographic areas.
``(e) Provider Participation.--
``(1) In general.--The Secretary shall establish conditions
of participation for health care providers under the public
health insurance option.
``(2) Licensure or certification.--The Secretary shall not
allow a health care provider to participate in the public
health insurance option unless such provider is appropriately
licensed or certified under State law.
``(3) Payment terms for providers.--
``(A) Physicians.--The Secretary shall provide for
the annual participation of physicians under the public
health insurance option, for which payment may be made
for services furnished during the year, in one of 2
classes:
``(i) Preferred physicians.--Those
physicians who agree to accept the payment rate
established under this section (without regard
to cost-sharing) as the payment in full.
``(ii) Participating, non-preferred
physicians.--Those physicians who agree not to
impose charges (in relation to the payment rate
described in subsection (c) for such
physicians) that exceed the ratio permitted
under section 1848(g)(2)(C) of the Social
Security Act.
``(B) Other providers.--The Secretary shall provide
for the participation (on an annual or other basis
specified by the Secretary) of health care providers
(other than physicians) under the public health
insurance option under which payment shall only be
available if the provider agrees to accept the payment
rate established under subsection (c) (without regard
to cost-sharing) as the payment in full.
``(4) Exclusion of certain providers.--The Secretary shall
exclude from participation under the public health insurance
option a health care provider that is excluded from
participation in a Federal health care program (as defined in
section 1128B(f) of the Social Security Act).
``(f) Application of Fraud and Abuse Provisions.--Provisions of law
(other than criminal law provisions) identified by the Secretary by
regulation, in consultation with the Inspector General of the
Department of Health and Human Services, that impose sanctions with
respect to waste, fraud, and abuse under Medicare, such as the False
Claims Act (31 U.S.C. 3729 et seq.), shall also apply to the public
health insurance option.
``(g) Medicare Defined.--For purposes of this section, the term
`Medicare' means the health insurance programs under title XVIII of the
Social Security Act.''.
(b) Conforming Amendments.--
(1) Treatment as qualified health plan.--Section 1301(a)(2)
of the Patient Protection and Affordable Care Act, as amended
by section 10104(a) of such Act, is amended--
(A) in the heading, by inserting ``, the public
health insurance option,'' before ``and''; and
(B) by inserting ``the public health insurance
option under section 1325,'' before ``and a multi-State
plan''.
(2) Level playing field.--Section 1324(a) of such Act, as
amended by section 10104(n) of such Act, is amended by
inserting ``the public health insurance option under section
1325,'' before ``or a multi-State qualified health plan''.
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