[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 4027 Introduced in Senate (IS)]
<DOC>
119th CONGRESS
2d Session
S. 4027
To ban anticompetitive terms in facility and insurance contracts that
limit access to higher quality, lower cost care.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 9, 2026
Mr. Husted introduced the following bill; which was read twice and
referred to the Committee on Health, Education, Labor, and Pensions
_______________________________________________________________________
A BILL
To ban anticompetitive terms in facility and insurance contracts that
limit access to higher quality, lower cost care.
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 ``Healthy Competition for Better Care
Act''.
SEC. 2. BANNING ANTICOMPETITIVE TERMS IN FACILITY AND INSURANCE
CONTRACTS THAT LIMIT ACCESS TO HIGHER QUALITY, LOWER COST
CARE.
(a) In General.--
(1) PHSA.--
(A) In general.--Section 2799A-9 of the Public
Health Service Act (42 U.S.C. 300gg-119) is amended--
(i) in the heading, by striking ``by
removing'' and all that follows through
``information'' and inserting ``; prohibition
on anticompetitive agreements'';
(ii) in subsection (a)(5), in the first
sentence, by striking ``section'' and inserting
``subsection''; and
(iii) by adding at the end the following:
``(b) Protecting Health Plans Network Design Flexibility.--
``(1) In general.--A group health plan or a health
insurance issuer offering group or individual health insurance
coverage may not enter into an agreement with a covered entity
if such agreement, directly or indirectly--
``(A) restricts (including by operation of any
agreement in effect between such covered entity and
another covered entity) the group health plan or health
insurance issuer from--
``(i) directing or steering participants or
beneficiaries to other health care providers
who are not subject to such agreement; or
``(ii) offering incentives to encourage
participants or beneficiaries to utilize
specific health care providers;
``(B) requires the group health plan or health
insurance issuer to enter into any additional agreement
with an affiliate of the covered entity;
``(C) requires the group health plan or health
insurance issuer to agree to payment rates or other
terms for any affiliate of the covered entity not party
to the agreement; or
``(D) restricts other group health plans or health
insurance issuers not party to the agreement from
paying a lower rate for items or services than the plan
or issuer involved in the agreement pays for such items
or services.
``(2) Exceptions for certain provider group and value-based
network designs.--Paragraph (1)(A) shall not apply to a group
health plan or health insurance issuer offering group or
individual health insurance coverage with respect to--
``(A) a health maintenance organization, if such
health maintenance organization operates primarily
through exclusive contracts with multi-specialty
physician groups, nor to any arrangement between such a
health maintenance organization and its affiliates; or
``(B) a value-based network arrangement, such as an
exclusive provider network, accountable care
organization, center of excellence, a provider
sponsored health insurance issuer that operates
primarily through aligned multi-specialty physician
group practices or integrated health systems, or such
other similar network arrangements as determined by the
Secretary through guidance or rulemaking.
``(3) Covered entity defined.--For purposes of this
subsection, the term `covered entity' means a health care
provider, network or association of providers, third-party
administrator, or other service provider offering access to a
network of providers.
``(4) State grandfathering option.--An applicable State
authority may make a determination that the prohibitions under
paragraph (1)(A) (relating to conditions that would direct or
steer enrollees to, or offer incentives to encourage enrollees
to use, other health care providers) will not apply in the
State with respect to any specified agreement executed on June
19, 2019, and any agreements related to such specified
agreement executed on or before December 31, 2020, for a
maximum length of nonapplicability of up to 10 years from the
date of execution of the contract if the applicable State
authority determines that the contract is unlikely to
significantly lessen competition. With respect to a specified
agreement for which an applicable State authority has made a
determination under the preceding sentence, an applicable State
authority may determine whether renewal of the contract, within
the applicable 10-year period, is allowed.
``(5) Rule of construction.--Except as provided in
paragraph (1), nothing in this subsection shall be construed to
limit network design or cost or quality initiatives by a group
health plan or health insurance issuer, including accountable
care organizations, exclusive provider organizations, networks
that tier providers by cost or quality or steer enrollees to
centers of excellence, or other pay-for-performance
programs.''.
(B) Regulations.--Not later than 1 year after the
date of the enactment of this Act, the Secretary of
Health and Human Services, in consultation with the
Secretary of Labor and the Secretary of the Treasury,
shall promulgate regulations to carry out the
amendments made by this paragraph.
(2) Employee retirement income security act of 1974.--
(A) In general.--Section 724 of the Employee
Retirement Income Security Act of 1974 (29 U.S.C.
1185m) is amended--
(i) in the heading, by striking ``by
removing'' and all that follows through
``information'' and inserting ``; prohibition
on anticompetitive agreements'';
(ii) in subsection (a)(4), in the first
sentence, by striking ``section'' and inserting
``subsection''; and
(iii) by adding at the end the following:
``(b) Protecting Health Plans Network Design Flexibility.--
``(1) In general.--A group health plan or a health
insurance issuer offering group health insurance coverage may
not enter into an agreement with a covered entity if such
agreement, directly or indirectly--
``(A) restricts (including by operation of any
agreement in effect between such covered entity and
another covered entity) the group health plan or health
insurance issuer from--
``(i) directing or steering participants or
beneficiaries to other health care providers
who are not subject to such agreement; or
``(ii) offering incentives to encourage
participants or beneficiaries to utilize
specific health care providers;
``(B) requires the group health plan or health
insurance issuer to enter into any additional agreement
with an affiliate of the covered entity;
``(C) requires the group health plan or health
insurance issuer to agree to payment rates or other
terms for any affiliate of the covered entity not party
to the agreement; or
``(D) restricts other group health plans or health
insurance issuers not party to the agreement from
paying a lower rate for items or services than the plan
or issuer involved in the agreement pays for such items
or services.
``(2) Exceptions for certain provider group and value-based
network designs.--Paragraph (1)(A) shall not apply to a group
health plan or health insurance issuer offering group health
insurance coverage with respect to--
``(A) a health maintenance organization, if such
health maintenance organization operates primarily
through exclusive contracts with multi-specialty
physician groups, nor to any arrangement between such a
health maintenance organization and its affiliates; or
``(B) a value-based network arrangement, such as an
exclusive provider network, accountable care
organization, center of excellence, a provider
sponsored health insurance issuer that operates
primarily through aligned multi-specialty physician
group practices or integrated health systems, or such
other similar network arrangements as determined by the
Secretary through guidance or rulemaking.
``(3) Covered entity defined.--For purposes of this
subsection, the term `covered entity' means a health care
provider, network or association of providers, third-party
administrator, or other service provider offering access to a
network of providers.
``(4) State grandfathering option.--An applicable State
authority may make a determination that the prohibitions under
paragraph (1)(A) (relating to conditions that would direct or
steer enrollees to, or offer incentives to encourage enrollees
to use, other health care providers) will not apply in the
State with respect to any specified agreement executed on June
19, 2019, and any agreements related to such specified
agreement executed on or before December 31, 2020, for a
maximum length of nonapplicability of up to 10 years from the
date of execution of the contract if the applicable State
authority determines that the contract is unlikely to
significantly lessen competition. With respect to a specified
agreement for which an applicable State authority has made a
determination under the preceding sentence, an applicable State
authority may determine whether renewal of the contract, within
the applicable 10-year period, is allowed.
``(5) Rule of construction.--Except as provided in
paragraph (1), nothing in this subsection shall be construed to
limit network design or cost or quality initiatives by a group
health plan or health insurance issuer, including accountable
care organizations, exclusive provider organizations, networks
that tier providers by cost or quality or steer enrollees to
centers of excellence, or other pay-for-performance
programs.''.
(B) Clerical amendment.--The table of contents in
section 1 of such Act is amended, in the entry relating
to section 724, by amending such entry to read as
follows:
``Sec. 724. Increasing transparency; prohibition on anticompetitive
agreements.''.
(C) Regulations.--Not later than 1 year after the
date of the enactment of this Act, the Secretary of
Labor, in consultation with the Secretary of Health and
Human Services and the Secretary of the Treasury, shall
promulgate regulations to carry out the amendments made
by this paragraph.
(3) IRC.--
(A) In general.--Section 9824 of the Internal
Revenue Code of 1986 is amended--
(i) in the header, by striking ``by
removing'' and all that follows through
``information'' and inserting ``; prohibition
on anticompetitive agreements'';
(ii) in subsection (a)(4), in the first
sentence, by striking ``section'' and inserting
``subsection''; and
(iii) by adding at the end the following:
``(b) Protecting Health Plans Network Design Flexibility.--
``(1) In general.--A group health plan may not enter into
an agreement with a covered entity if such agreement, directly
or indirectly--
``(A) restricts (including by operation of any
agreement in effect between such covered entity and
another covered entity) the group health plan from--
``(i) directing or steering participants or
beneficiaries to other health care providers
who are not subject to such agreement; or
``(ii) offering incentives to encourage
participants or beneficiaries to utilize
specific health care providers;
``(B) requires the group health plan to enter into
any additional agreement with an affiliate of the
covered entity;
``(C) requires the group health plan to agree to
payment rates or other terms for any affiliate of the
covered entity not party to the agreement; or
``(D) restricts other group health plans not party
to the agreement from paying a lower rate for items or
services than the plan involved in the agreement pays
for such items or services.
``(2) Exceptions for certain provider group and value-based
network designs.--Paragraph (1)(A) shall not apply to a group
health plan with respect to--
``(A) a health maintenance organization, if such
health maintenance organization operates primarily
through exclusive contracts with multi-specialty
physician groups, nor to any arrangement between such a
health maintenance organization and its affiliates; or
``(B) a value-based network arrangement, such as an
exclusive provider network, accountable care
organization, center of excellence, a provider
sponsored health insurance issuer that operates
primarily through aligned multi-specialty physician
group practices or integrated health systems, or such
other similar network arrangements as determined by the
Secretary through guidance or rulemaking.
``(3) Covered entity defined.--For purposes of this
subsection, the term `covered entity' means a health care
provider, network or association of providers, third-party
administrator, or other service provider offering access to a
network of providers.
``(4) State grandfathering option.--An applicable State
authority may make a determination that the prohibitions under
paragraph (1)(A) (relating to conditions that would direct or
steer enrollees to, or offer incentives to encourage enrollees
to use, other health care providers) will not apply in the
State with respect to any specified agreement executed on June
19, 2019, and any agreements related to such specified
agreement executed on or before December 31, 2020, for a
maximum length of nonapplicability of up to 10 years from the
date of execution of the contract if the applicable State
authority determines that the contract is unlikely to
significantly lessen competition. With respect to a specified
agreement for which an applicable State authority has made a
determination under the preceding sentence, an applicable State
authority may determine whether renewal of the contract, within
the applicable 10-year period, is allowed.
``(5) Rule of construction.--Except as provided in
paragraph (1), nothing in this subsection shall be construed to
limit network design or cost or quality initiatives by a group
health plan, including accountable care organizations,
exclusive provider organizations, networks that tier providers
by cost or quality or steer enrollees to centers of excellence,
or other pay-for-performance programs.''.
(B) Clerical amendment.--The table of contents in
section 1 of such Act is amended, in the entry relating
to section 9824, by amending such entry to read as
follows:
``Sec. 9824. Increasing transparency; prohibition on anticompetitive
agreements.''.
(C) Regulations.--Not later than 1 year after the
date of the enactment of this Act, the Secretary of the
Treasury, in consultation with the Secretary of Health
and Human Services and the Secretary of Labor, shall
promulgate regulations to carry out the amendments made
by this paragraph.
(b) Effective Date.--The amendments made by subsection (a) shall
apply with respect to any contract entered into, amended, or renewed on
or after the date that is 18 months after the date of enactment of this
Act.
<all>