[Congressional Record Volume 142, Number 115 (Wednesday, July 31, 1996)]
[Senate]
[Pages S9295-S9299]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. WYDEN:
  S. 2005. A bill to prohibit the restriction of certain types of 
medical communications between a health care provider and a patient; to 
the Committee on Labor and Human Resources.


           the patient communications protection act of 1996

  Mr. WYDEN. Mr. President, I rise today to introduce two new bills 
which I believe will help more fully inform patients and consumers 
about the health care choices they face, and safeguard the most 
critical relationship between care giver and patient.
  The first bill, which I introduce with my colleagues Senator Snowe 
and Senator Boxer, is the Health Care Quality Improvements Act of 1996. 
It amends and improves the 1986 public law which created the national 
practitioner databank, an informational resource maintained by the 
Department of Health and Human Services which is a compendium of State 
disciplinary actions and civil malpractice case judgments against 
caregivers. As of this year, some 86,000 caregivers are listed in this 
taxpayer-supported databank. Currently, this informational resource is 
accessible only by hospitals, insurance plans, and State boards of 
medicine and health care licensing. The legislation introduced by 
Senator Snowe and me, today, would for the first time allow public 
access to critically important databank records. Caregivers who have 
had at least three reportable incidents in their files would have their 
entire databank records opened to the public. This legislation also 
would create an Internet site on the World Wide Web allowing easier 
access for publicly accessible information.
  The second bill, the Patient Communications Protection Act of 1996, 
would make illegal provisions in some contracts between caregivers and 
health plans which restrict communications between caregivers and their 
patients. Too often, I believe, these contract provisions limit the 
free and necessary communications of information to patients regarding 
their medical condition and all possible modalities of treatment. This 
legislation, while upholding the right of plans to work with physicians 
to improve the overall quality of care within a health plan, clearly 
restricts plans from impeding the free flow of medical information 
between State-licensed caregivers and patient.
  The Health Care Quality Improvements Act is endorsed by a number of 
groups including Families USA, Consumer Action, the National 
Association of Health Data Organizations, and the United Seniors Health 
Cooperative.
  The Patient Communications Protection Act is supported by the Oregon 
Medical Association, the American Association of Retired Persons, the 
Center for Patient Advocacy, Citizen Action, the Consumers Union, and 
the American College of Emergency Physicians.
  Mr. President, I ask unanimous consent that the text of the bills be 
printed in the Record.
  There being no objection, the bills were ordered to be printed in the 
Record, as follows:

                                S. 2004

       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 ``Health Care Quality 
     Improvement Act Amendments of 1996''.

     SEC. 2. STANDARDS FOR PROFESSIONAL REVIEW ACTIONS.

       Section 412(a) of the Health Care Quality Improvement Act 
     of 1986 (42 U.S.C. 11112(a)) is amended in the matter after 
     and below paragraph (4) by adding at the end the following 
     sentence: ``A motion for summary judgment that such standards 
     have been met shall be granted unless, considering the 
     evidence in the light most favorable to the opposing party, a 
     reasonable finder of fact could conclude that the presumption 
     has been so rebutted. The decision on such a motion may be 
     appealed as of right, without regard to whether the motion is 
     granted or denied, and the courts of appeals (other than the 
     United States Court of Appeals for the Federal Circuit) have 
     jurisdiction of appeals from such decisions of the district 
     courts.''.

     SEC. 3. REQUIRING REPORTS ON MEDICAL MALPRACTICE DATA.

       (a) In General.--Section 421 of the Health Care Quality 
     Improvement Act of 1986 (42 U.S.C. 11131) is amended--
       (1) by striking subsections (a) and (b);
       (2) by redesignating subsections (c) and (d) as subsections 
     (d) and (e), respectively; and
       (3) by inserting before subsection (d) (as so redesignated) 
     the following subsections:
       ``(a) In General.--
       ``(1) Requirement of reporting.--Subject to the subsequent 
     provisions of this subsection, each person or entity which 
     makes payment under a policy of insurance, self-insurance, or 
     otherwise in settlement (or partial settlement) of, or in 
     satisfaction of a judgment in, a medical malpractice action 
     or claim shall report, in accordance with section 424, 
     information respecting the payment and circumstances thereof.
       ``(2) Payments by practitioners.--The persons to whom the 
     requirement of paragraph (1) applies include a physician or 
     other licenses healthcare practitioner who makes a payment 
     described in such paragraph and whose acts or omissions are 
     the basis of the action or claim involved. The preceding 
     sentence is subject to paragraph (3).
       ``(3) Refind of fees.--With respect to a physician or other 
     licensed health care practitioner whose acts or omissions are 
     the basis of an action or claim described in paragraph (1), 
     the requirement of such paragraph shall not apply to a 
     payment described in such paragraph if--
       ``(A) the payment is made by the physician or practitioner 
     as a refund of fees for the health services involved, and
       ``(B) the payment does not exceed the amount of the 
     original charge for the health services.
       ``(4) Definition of entity and person.--For purposes of 
     this section, the term `entity' includes the Federal 
     Government, any State or local government, and any insurance 
     company or other private entity; and the term `person' 
     includes Federal officers and employees.
       ``(b) Information To Be Reported.--The information to be 
     reported under subsection (a) by a person or entity regarding 
     a payment and an action or claim includes the following:
       ``(1)(A) The name of each physician or other licensed 
     health care practitioner whose acts or omissions were the 
     basis of the action or claim; and (to the extent authorized 
     under title II of the Social Security Act) the social 
     security account number assigned to the physician or 
     practitioner.
       ``(B) The medical field of the physician or practitioner, 
     including as applicable the medical specialty.
       ``(C) The date on which the physician or practitioner was 
     first licensed in the medical field involved, and the number 
     of years the physician or practitioner has been practicing in 
     such field.
       ``(D) If the physician or practitioner could not be 
     identified for purposes of subparagraph (A)--
       ``(i) a statement of such fact and an explanation of the 
     inability to make the identification, and
       ``(ii) the name of the hospital or other health services 
     organization (as defined in section 431) for whose benefit 
     the payment was made.
       ``(2) The amount of the payment.
       ``(3) The name (if known) of any hospital or other health 
     services organization with which the physician or 
     practitioner is affiliated or associated.
       ``(4)(A) A statement that describes the acts or omissions 
     and injuries or illnesses upon which the action or claim was 
     based, that specifies whether an action was filed, and if an 
     action was filed, that specifies whether the action was a 
     class action.
       ``(B) A statement by the physician or practitioner 
     regarding the action or claim, if the physician or 
     practitioner elects to make such a statement.
       ``(C) If the payment was made without the consent of the 
     physician or practitioner, a statement specifying such fact 
     and the reasons underlying the decision to make the payment 
     without such consent.
       ``(5) Such other information as the Secretary determines is 
     required for appropriate interpretation of information 
     reported under this section.
       ``(c) Certain Reporting Criteria; Notice to 
     Practitioners.--
       ``(1) Reporting criteria.--The establishing criteria under 
     section 424(a) for reports under this section, the Secretary 
     shall establish criteria regarding statements under 
     subsection (b)(4). Such criteria shall include--
       ``(A) criteria regarding the length of each of the 
     statements,
       ``(B) criteria regarding the notice required by paragraph 
     (2) of this subsection, and
       ``(C) such other criteria as the Secretary determines to be 
     appropriate.
       ``(2) Notice of opportunity to make statement.--In the case 
     of an entity that prepares a report under subsection (a)(1) 
     regarding a payment and an action or claim, the entity shall 
     notify any physician or practitioner identified 
     under subsection (b)(1)(A) of the opportunity to make a 
     statement under subsection (b)(4)(B). Criteria under 
     paragraph (1)(B) of this subsection shall include criteria 
     regarding the date by which the reporting entity is to 
     provide the notice and the date by which the physician or 
     practitioner is to submit the statement to the entity.''.
       (b) Definition of Health Services Organization.--Section 
     431 of the Health Care Quality Improvement Act of 1986 (42 
     U.S.C. 11151) is amended--
       (1) by redesignating paragraphs (5) through (14) as 
     paragraphs (6) through (15), respectively; and

[[Page S9297]]

       (2) by inserting after paragraph (4) the following 
     paragraph:
       ``(5) The term `health services organization' means an 
     entity that, directly or through contracts, provides health 
     services. Such term includes hospitals; health maintenance 
     organizations and other health plans; and health care 
     entities (as defined in paragraph (4)).''.
       (c) Conforming Amendments.--
       (1) In general.--The Health Care Quality Improvement Act of 
     1986 (42 U.S.C. 11101 et seq.) is amended--
       (A) in section 411(a)(1), in the matter preceding 
     subparagraph (A), by striking ``431(9)'' and inserting 
     ``431(10)'';
       (B) in section 421(d) (as redesignated by subsection (a)(2) 
     of this section), by inserting ``person or'' before 
     ``entity'';
       (C) in section 422(a)(2)(A), by inserting before the comma 
     at the end the following: ``, and (to the extent authorized 
     under title II of the Social Security Act) the social 
     security account number assigned to the physician''; and
       (D) in section 423(a)(3)(A), by inserting before the comma 
     at the end the following: ``, and (to the extent authorized 
     under title II of the Social Security Act) the social 
     security account number assigned to the physician or 
     practitioner''.
       (2) Applicability of requirements to federal entities.--
       (A) Section 432 of the Health Care Quality Improvement Act 
     of 1986 (42 U.S.C. 11152) is amended--
       (i) by striking subsection (b); and
       (ii) by redesignating subsection (c) as subsection (b).
       (B) Section 432 of the Health Care Quality Improvement Act 
     of 1986 (42 U.S.C. 11133) is amended by adding at the end the 
     following subsection:
       ``(e) Applicability to Federal Facilities and Physicians.--
       ``(1) In general.--Subsection (a) applies to Federal health 
     facilities (including hospitals) and actions by such 
     facilities regarding the competence or professional conduct 
     of Federal physicians to the same extent and in the same 
     manner as such subsection applies to health care entities and 
     professional review actions.
       ``(2) Relevant board of medical examiners.--For purposes of 
     paragraph (1), the Board of Medical Examiners to which a 
     Federal health facility is to report is the Board of Medical 
     Examiners of the State within which the facility is 
     located.''.
       (C) Section 425 of the Health Care Quality Improvement Act 
     of 1986 (42 U.S.C. 11135) is amended by adding at the end the 
     following subsection:
       ``(d) Applicability to Federal Hospitals.--This section 
     applies to Federal hospitals to the same extent and in the 
     same manner as such subsection applies to other 
     hospitals.''.

     SEC. 4. REPORTING OF SANCTIONS TAKEN BY BOARDS OF MEDICAL 
                   EXAMINERS.

       Section 422(a) of the Health Care Quality Improvement Act 
     of 1986 (42 U.S.C. 11132(a)) is amended--
       (1) in paragraph (1)(A), by striking ``which revokes or 
     suspends'' and inserting ``which denies, revokes, or 
     suspends''; and
       (2) in paragraph (2)--
       (A) in subparagraph (B), by striking ``(if known)'' and all 
     that follows and inserting ``for the action described in 
     paragraph (1)(A) that was taken with respect to the physician 
     or, if known, for the surrender of the license,'';
       (B) by redesignating subparagraph (C) as subparagraph (E); 
     and
       (C) by inserting after subparagraph (B) the following 
     subparagraphs:
       ``(C) the medical field of the physician, if known, 
     including as applicable the medical specialty,
       ``(D) the date on which the physician was first licensed in 
     the medical field, and the number of years the physician has 
     been practicing in such field, if known, and''.

     SEC. 5. REPORTING OF CERTAIN PROFESSIONAL REVIEW ACTIONS 
                   TAKEN BY HEALTH CARE ENTITIES.

       Section 423(a)(3) of the Health Care Quality Improvement 
     Act of 1986 (42 U.S.C. 11133(a)(3)) is amended--
       (1) in subparagraph (B), by striking ``and'' after 
     ``surrender,'';
       (2) by redesignating subparagraph (C) a subparagraph (E); 
     and
       (3) by inserting after subparagraph (B) the following 
     subparagraphs:
       ``(C) the medical field of the physician, if known, 
     including as applicable the medical specialty,
       ``(D) the date on which the physician was first licensed in 
     the medical field, and the number of years the physician has 
     been practicing in such field, if known, and''.

     SEC. 6. FORM OF REPORTING.

       Section 424 of the Health Care Quality Improvement Act of 
     1986 (42 U.S.C. 11134) is amended by adding at the end the 
     following subsection:
       ``(d) Additional Requirements.--Not later than 30 days 
     after the effective date for this subsection under section 11 
     of the Health Care Quality Improvement Act Amendments of 
     1996, the information reported under sections 421, 422(a), 
     and 423(b) shall be available (to persons and entities 
     authorized in this Act to receive the information) in 
     accordance with the following:
       ``(1) The methods of organizing the information shall 
     include organizing by medical field (and as applicable by 
     medical specialty).
       ``(2) With respect to medical malpractice actions reported 
     under section 421(b)(4)(A), the methods of organizing shall 
     specify whether the action was a class action.''.

     SEC. 7. DUTY TO OBTAIN INFORMATION.

       Part B of the Health Care Quality Improvement Act of 1986 
     (42 U.S.C. 11131 et seq.) is amended by inserting after 
     section 425 the following section:

     ``SEC. 425A. DUTY OF BOARDS OF MEDICAL EXAMINERS TO OBTAIN 
                   INFORMATION.

       ``(a) In General.--Effective 2 years after the date of the 
     enactment of the Health Care Quality Improvement Act 
     Amendments of 1996, it is the duty of each Board of Medical 
     Examiners to request from the Secretary (or the agency 
     designated under section 424(b)) information reported 
     under this part concerning a physician--
       ``(1) at the time the physician submits the initial 
     application for a physician's license in the State involved, 
     and
       ``(2) at each time the physician submits an application to 
     continue in effect the license, subject to subsection (d).

     A Board of Medical Examiners may request information reported 
     under this part concerning a physician at other times.
       ``(b) Failure To Obtain Information.--With respect to an 
     action for mandamus or other cause of action against a Board 
     of Medical Examiners, a Board which does not request 
     information respecting a physician as required under 
     subsection (a) is presumed to have knowledge of any 
     information reported under this part to the Secretary with 
     respect to the physician.
       ``(c) Reliance on Information Provided.--With respect to a 
     cause of action against a Board of Medical Examiners, each 
     Board of Medical Examiners may rely upon information provided 
     to the Board under this title, unless the Board has knowledge 
     that the information provided was false.
       ``(d) State Option Regarding Continuation of Licenses.--
       ``(1) Establishment of electronic system for transmission 
     of data.--After consultation with the States, the Secretary 
     shall establish a system for electronically transmitting 
     information under this part to States that elect to install 
     equipment necessary for participation in the system. The 
     system shall possess the capability to receive transmissions 
     of data from such States.
       ``(2) State option regarding electronic system.--With 
     respect to compliance with subsection (a)(2) (relating to 
     applications to continue in effect physicians' licenses), if 
     a State is participating in the system under paragraph (1) 
     and provides the Board of Medical Examiners of the State with 
     access to the system, the Board may elect, in lieu of 
     complying with subsection (a)(2), to comply with paragraph 
     (3) of this subsection.
       ``(3) Description of option.--For purposes of paragraph 
     (2), a Board of Medical Examiners is complying with this 
     paragraph if--
       ``(A) through the system under paragraph (1), the Board 
     annually transmits to the Secretary (or the agency designated 
     under section 424(b)) data identifying all individuals who 
     hold a valid physician's license issued by the Board, without 
     regard to whether the licenses are expiring, and
       ``(B) after receiving from the Secretary (or such agency) a 
     list of physicians under paragraph (4)(B), the Board complies 
     with paragraph (5).
       ``(4) Identification by secretary of relevant physicians.--
     After receiving data under paragraph (3)(A) from a Board of 
     Medical Examiners, the Secretary (or the agency designated 
     under section 424(b)) shall--
       ``(A) from among the physicians identified through the 
     data, determine which of such physicians has been the subject 
     of information reported under this part, and the State in 
     which the incidents involved occurred, and
       ``(B) provide to the Board, through the system under 
     paragraph (1), a list of the physicians who have been such 
     subjects, which list specifies for each physician the States 
     in which the incidents involved occurred.
       ``(5) Request by state of information on relevant 
     physicians.--For purposes of paragraph
       (3)(B), a Board of Medical Examiners of a State is 
     complying with this paragraph if, after receiving the list of 
     physicians under paragraph (4)(B), the Board promptly--
       (A) identifies which of the physicians has had, for 
     purposes of paragraph (4), an incident in another State, and
       (B) requests for the Secretary (or the agency) information 
     reported under this part concerning each of the physicians so 
     identified.''.

     SEC. 8. ADDITIONAL PROVISIONS REGARDING ACCESS TO 
                   INFORMATION; MISCELLANEOUS PROVISIONS.

       (a) Access to Information.--Section 427(a) of the Health 
     Care Quality Improvement Act of 1986 (42 U.S.C. 11137(a)) is 
     amended to read as follows:
       ``(a) Access Regarding Licensing, Employment, and Clinical 
     Privileges.--The Secretary (or the agency designated under 
     section 424(b)) shall, upon request, provide information 
     reported under this part concerning a physician or other 
     licensed health care practitioner to--
       ``(1) State licensing boards, and
       ``(2) hospitals and other health services organizations--
       ``(A) that have entered (or may be entering) into an 
     employment or affiliation relationship with the physician or 
     practitioner, or
       ``(B) to which the physician or practitioner has applied 
     for clinical privileges or appointment to the medical 
     staff.''.
       (b) Fees.--Section 427(b)(4) of the Health Care Quality 
     Improvement Act of 1986 (42

[[Page S9298]]

     U.S.C. 11137(b)(4)) is amended to read as follows:
       ``(4) Fees.--In disclosing information under subsection (a) 
     or section 426, the Secretary may impose fees in amounts 
     reasonably related to the costs of carrying out the duties of 
     the Secretary regarding the information reported under this 
     part (including the functions specified in section 424(b) 
     with respect to the information), except that a fee may not 
     be imposed for providing a list under section 425A(d)(4)(B) 
     to any Board of Medical Examiners. Such fees are available to 
     the Secretary (or, in the Secretary's discretion, to the 
     agency designated under section 424(b)) to cover such costs. 
     Such fees remain available until expended.''.
       (c) Additional Disclosures of Information.--Section 427 of 
     the Health Care Quality Improvement Act of 1986 (42 U.S.C. 
     11137) is amended by adding at the end the following 
     subsection:
       ``(e) Availability of Information to Public.--
       ``(1) In general.--Not later than 30 days after the 
     effective date for this subsection under section 11 of the 
     Health Care Quality Improvement Act Amendments of 1996, and 
     every 3 months thereafter, the Secretary shall, except as 
     provided in paragraph (2), make available to the public all 
     information reported under sections 421, 422(a), and 423(b). 
     For such purpose, the information shall be published as a 
     separate document whose principal topic is such information, 
     and in addition the information shall be made available 
     through the method described in paragraph (3).
       ``(2) Limitations.--In the case of a physician or other 
     licensed health care practitioner with respect to whom one or 
     more incidents have been reported under sections 421, 422(a), 
     and 423(b), the following applies:
       ``(A) Information may not be made available under paragraph 
     (1) if, subject to subparagraph (B), the aggregate number of 
     discrete incidents reported under such sections is not more 
     than 2.
       ``(B) A discrete incident reported under section 421 may 
     not be counted under subparagraph (A) if the payment for the 
     medical malpractice action or claim involved was less than 
     $25,000.
       ``(C) If the number of discrete incidents counted under 
     subparagraph (A) is 3 or more, the resulting availability of 
     information under paragraph (1) with respect to such 
     practitioner shall include information reported on all the 
     discrete incidents that were so counted. Such availability 
     may not include information on any incident not counted by 
     reason of subparagraph (B).
       ``(D) Of the information reported under section 421, the 
     following information may not be made available under 
     paragraph (1) (regardless of the number of discrete incidents 
     counted under subparagraph (A) and regardless of the amount 
     of the payments involved):
       ``(i) The social security account number of the physician 
     or practitioner.
       ``(ii) Information disclosing the identity of any patient 
     involved in the incidents involved.
       ``(iii) With respect to information that the Secretary 
     requires under section 421(b)(5) (if any)--
       ``(I) the home address of the physician or practitioner, 
     and
       ``(II) the number assigned to the physician or practitioner 
     by the Drug Enforcement Administration.
       ``(iv) Information not required to be reported under such 
     section.
       ``(3) Use of internet.--For purposes of paragraph (1), the 
     method described in this paragraph is to make the information 
     involved available to the public through the 
     telecommunications medium known as the World Wide Web of the 
     Internet. The Secretary, acting through the Administrator of 
     the Health Resources and Services Administration, shall 
     provide for the establishment of a site on such medium, and 
     shall update the information maintained through such medium 
     not less frequently than once every 3 months.
       ``(4) Dissemination; fees.--The Secretary shall disseminate 
     each publication under paragraph (1) to public libraries 
     without charge. In providing the publication to other 
     entities, and in making information available under paragraph 
     (3), the Secretary may impose a fee reasonably related to the 
     costs of the Secretary in carrying out this subsection. Such 
     fees are available to the Secretary (or, in the Secretary's 
     discretion, to the agency designated under section 424(b)) to 
     cover such costs. Such fees remain available until 
     expended.''.
       (d) Conforming Amendments.--Section 427 of the Health Care 
     Quality Improvement Act of 1986 (42 U.S.C. 11137) is 
     amended--
       (1) in subsection (b)(1), in the first sentence, by 
     striking ``Information reported'' and inserting the 
     following: ``Except for information disclosed under 
     subsection (e), information reported''; and
       (2) in the heading for the section, by striking 
     ``MISCELLANEOUS PROVISIONS'' and inserting the following: 
     ``ADDITIONAL PROVISIONS REGARDING ACCESS TO INFORMATION; 
     MISCELLANEOUS PROVISIONS''.

     SEC. 9. OTHER MATTERS.

       The Health Care Quality Improvement Act of 1986 (42 U.S.C. 
     11101 et seq.) is amended--
       (1) by redesignating part C as part D; and
       (2) by inserting after part B the following part:

  ``PART C--OTHER MATTERS REGARDING IMPROVEMENT OF HEALTH CARE QUALITY

     ``SEC. 428. PROHIBITION AGAINST SETTLEMENT WITHOUT CONSENT OF 
                   PRACTITIONER.

       ``(a) Prohibition.--With respect to a physician or other 
     licensed health care practitioner whose acts or omissions are 
     the basis of a medical malpractice action or claim, an entity 
     may not make a payment described in section 421(a)(1) without 
     the written consent of the physician or practitioner, subject 
     to subsection (b).
       ``(b) Exceptions.--Subsection (a) shall not apply with 
     respect to a payment by an entity regarding an action or 
     claim, subject to subsection (c)--
       ``(1) if the payment is made in satisfaction of a judgment 
     in a court of competent jurisdiction,
       ``(2) if, with respect to the action or claim, the 
     physician or other licensed health care practitioner involved 
     enters a process of alternative dispute resolution, and the 
     process has been concluded or any of the individuals involved 
     has terminated participation in the process,
       ``(3)(A) the entity delivers directly, or makes a 
     reasonable effort to deliver through the mail, a written 
     notice to the physician or practitioner involved providing 
     the information specified in subsection (c), and
       ``(B) a 30-day period elapses, at the conclusion of which 
     the entity has a reasonable belief that the physician or 
     practitioner does not object to the payment.
       ``(c) Criteria Regarding Notice.--For purposes of 
     subsection (b)(3) regarding a written notice to a physician 
     or practitioner--
       ``(1) the notice shall be considered to have been delivered 
     if the notice was delivered to the home or business address 
     of the physician or practitioner, and to the attorney (if 
     any) representing the physician or practitioner in the action 
     or claim involved,
       ``(2) the notice shall be considered to have been delivered 
     directly if the notice was delivered personally by the entity 
     involved or by an agent of the entity,
       ``(3) the entity shall be considered to have made a 
     reasonable effort to deliver the notice through the mail if 
     the entity provided the notice through certified mail, with 
     return receipt requested,
       ``(4) the information specified in this paragraph for the 
     notice is that the entity intends to make the payment 
     involved; that the physician or practitioner has a legal 
     right to prohibit the payment; and that such right expires in 
     30 days, with a specification of the date on which the right 
     expires, and
       ``(5) the 30-day period begins on the date on which the 
     notice is delivered directly to the physician or 
     practitioner, or on the seventh day after the date on which 
     the notice is posted, as the case may be.
       ``(d) Civil Money Penalty.--An entity that makes a payment 
     in violation of subsection (a) shall be subject to a civil 
     money penalty of not more than $10,000 for each such payment 
     involved. Such penalty shall be imposed and collected in the 
     same manner as civil money penalties under subsection (a) of 
     section 1128A of the Social Security Act are imposed and 
     collected under that section.

     ``SEC. 429. EMPLOYMENT TERMINATION OF PHYSICIAN.

       ``(a) Requirement of Adequate Notice and Hearing.--
       ``(1) In general.--A health services organization may not 
     terminate the employment of a physician, and may not 
     terminate a contract with a physician for the provision of 
     health services, unless adequate notice and hearing 
     procedures have been afforded the physician involved.
       ``(2) Applicability.--Section 412(a)(3) applies in lieu of 
     paragraph (1) in the case of an employment termination that 
     is a professional review action. (With respect to the 
     preceding sentence, paragraph (1) does apply to an 
     employment termination that is an action described in 
     subparagraph (A) of section 431(10) or in the other 
     subparagraphs of such section.)
       ``(b) Safe Harbor.--
       ``(1) In general.--A health services organization is deemed 
     to have met the adequate notice and hearing requirement of 
     subsection (a) with respect to the employment of, or a 
     contract of, a physician if the conditions described in 
     paragraphs (2) through (4) are met (or are waived voluntarily 
     by the physician).
       ``(2) Notice of proposed action.--Conditions under 
     paragraph (1) are that the physician involved has been given 
     notice stating--
       ``(A)(i) that the health services organization proposes to 
     take action to terminate the employment or contract,
       ``(ii) reasons for the proposed action,
       ``(B)(i) that the physician has the right to request a 
     hearing on the proposed action,
       ``(ii) any time limit (of not less than 30 days) within 
     which to request such a hearing, and
       ``(C) a summary of the rights in the hearing under 
     paragraph (4).
       ``(3) Notice of hearing.--Conditions under paragraph (1) 
     are that, if a hearing is requested on a timely basis under 
     paragraph (2)(B), the physician involved must be given notice 
     stating--
       ``(A) the place, time, and date, of the hearing, which date 
     shall not be less than 30 days after the date of the notice, 
     and
       ``(B) a list of the witnesses (if any) expected to testify 
     at the hearing on behalf of the health services organization.
       ``(4) Conduct of hearing and notice.--Conditions under 
     paragraph (1) are that, if a hearing is requested on a timely 
     basis under paragraph (2)(B)--

[[Page S9299]]

       ``(A) subject to subparagraph (B), the hearing shall be 
     held (as determined by the health services organization)--
       ``(i) before arbitrator mutually acceptable to the 
     physician involved and the health services organization,
       ``(ii) before a hearing officer who is appointed by the 
     organization and who is not in direct economic competition 
     with the physician, or
       ``(iii) before a panel of individuals who are appointed by 
     the organization and are not in direct economic competition 
     with the physician,
       ``(B) the right to the hearing may be forfeited if the 
     physician fails, without good cause, to appear,
       ``(C) in the hearing the physician has the right--
       ``(i) to representation by an attorney or other person of 
     the physician's choice,
       ``(ii) to have a record made of the proceedings, copies of 
     which may be obtained by the physician upon payment of any 
     reasonable charges associated with the preparation thereof,
       ``(iii) to call, examine, and cross-examine witnesses,
       ``(iv) to present evidence determined to be relevant by the 
     hearing officer, regardless of its admissibility in a court 
     of law, and
       ``(v) to submit a written statement at the close of the 
     hearing, and
       ``(D) upon completion of the hearing, the physician has the 
     right--
       ``(i) to receive the written recommendation of the 
     arbitrator, officer, or panel, including a statement of the 
     basis for the recommendations, and
       ``(ii) to receive a written decision of the health services 
     organization, including a statement of the basis for the 
     decision.
       ``(c) Rule of Construction.--A health services 
     organization's failure to meet the conditions described in 
     paragraphs (2) through (4) of subsection (b) shall not, in 
     itself, constitute failure to meet the standards of 
     subsection (a).''.

     SEC. 10. DEFINITIONS.

       Section 431(6) of the Health Care Quality Improvement Act 
     of 1986, as redesignated by section 3(b)(1) of this Act, is 
     amended by inserting before the period the following: 
     ``(except that such term means an institution described in 
     such paragraph (1) (without regard to such paragraph (7)) if, 
     under applicable State or local law, the institution is 
     permitted to operate without being licensed or otherwise 
     approved as a hospital)''.

     SEC. 11. EFFECTIVE DATES.

       (a) Incorporation of Text of Amendments.--The amendments 
     described in this Act are made upon the date of the enactment 
     of this Act.
       (b) Substantive Effect.--Except as provided in subsection 
     (c)(1) and subsection (d), and except as otherwise provided 
     in this Act--
       (1) the amendments made by this Act take effect upon the 
     expiration of the 1-year period beginning on the date of the 
     enactment of this Act; and
       (2) prior to the expiration of such period, the Health Care 
     Quality Improvement Act of 1986, as in effect on the day 
     before such date of enactment, continues in effect.
       (c) Regulations.--
       (1) In general.--With respect to the amendments made by 
     this Act, the Secretary of Health and Human Services may 
     issue regulations pursuant to such amendments before the 
     expiration of the period specified in subsection (b)(1), and 
     may otherwise take appropriate action before the expiration 
     of such period to prepare for the responsibilities of the 
     Secretary to the amendments.
       (2) Absence of final rule.--The final rule for purposes of 
     paragraph (1) may not take effect before the expiration of 
     the period specified in subsection (b)(1), and the absence of 
     such a rule upon such expiration does not affect the 
     provisions of subsection (b).
       (d) Transitional Provisions Regarding Malpractice Payments 
     by Persons.--With respect to the reporting of information 
     under section 421 of the Health Care Quality Improvement Act 
     of 1986, the following applies:
       (1) The requirement of reporting by persons under section 
     421(a)(1) of such Act (as amended by section 3(a) of this 
     Act) takes effect 180 days after the date of the enactment of 
     this Act.
       (2) The requirement of reporting by persons applies to 
     payments under such section 421(a)(1) made before, on, or 
     after such date of enactment.
       (3)(A) The information received by the Secretary of Health 
     and Human Services on or before August 27, 1993, pursuant to 
     regulations requiring reports from persons (in addition to 
     reports from entities) shall be maintained in the same manner 
     as the information was maintained prior to such date, and 
     shall be available in accordance with the regulations in 
     effect under such Act prior to such date (which regulations 
     remain in effect unless a provision of this Act takes effect 
     pursuant to this section and requires otherwise).
       (B) Subparagraph (A) takes effect on the date of the 
     enactment of this Act.

                                S. 2005

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

     SECTION 1. SHORT TITLE; FINDINGS.

       (a) Short Title.--This Act may be cited as the ``Patient 
     Communications Protection Act of 1996''.
       (b) Findings.--Congress finds the following:
       (1) Patients need access to all relevant information to 
     make appropriate decisions, with their physicians, about 
     their health care.
       (2) Restrictions on the ability of physicians to provide 
     full disclosure of all relevant information to patients 
     making health care decisions violate the principles of 
     informed consent and practitioner ethical standards.
       (3) The offering and operation of health plans affect 
     commerce among the States. Health care providers located in 
     one State serve patients who reside in other States as well 
     as that State. In order to provide for uniform treatment of 
     health care providers and patients among the States, it is 
     necessary to cover health plans operating in one State as 
     well as those operating among the several States.

     SEC. 2. PROHIBITION OF INTERFERENCE WITH CERTAIN MEDICAL 
                   COMMUNICATIONS.

       (a) In General.--
       (1) Prohibition of certain provisions.--Subject to 
     paragraph (2), an entity offering a health plan (as defined 
     in subsection (d)(2)) may not include any provision that 
     prohibits or restricts any medical communication (as defined 
     in subsection (b)) as part of--
       (A) a written contract or agreement with a health care 
     provider,
       (B) a written statement to such a provider, or
       (C) an oral communication to such a provider.
       ``(2) Construction.--Nothing in this section shall be 
     construed as preventing an entity from exercising mutually 
     agreed upon terms and conditions not inconsistent with 
     paragraph (1), including terms or conditions requiring 
     caregivers to participate in, and cooperate with, all 
     programs, policies, and procedure developed or operated by 
     the person, corporation, partnership, association, or other 
     organization to ensure, review, or improve the quality of 
     health care.
       (3) Nullification.--Any provision described in paragraph 
     (1) is null and void.
       (b) Medical Communication Defined.--In this section, the 
     term ``medical communication'' means a communication made by 
     a health care provider with a patient of the provider (or the 
     guardian or legal representative of such patient) with 
     respect to the patient's physician or mental condition or 
     treatment options.
       (c) Enforcement Through Imposition of Civil Money 
     Penalty.--
       (1) In general.--Any entity that violates paragraph (1) of 
     subsection (a) shall be subject to a civil money penalty of 
     up to $15,000 for each violation. No such penalty shall be 
     imposed solely on the basis of an oral communication unless 
     the communication is part of a pattern or practice of such 
     communications and the violation is demonstrated by a 
     preponderance of the evidence.
       (2) Procedures.--The provisions of subsections (c) through 
     (l) of section 1128A of the Social Security Act (42 U.S.C. 
     1320a-7a) shall apply to civil money penalties under 
     paragraph (1) in the same manner as they apply to a penalty 
     or proceeding under section 1128A(a) to a penalty or 
     proceeding under section 1128A(a) of such Act.
       (d) Definitions.--For purposes of this section:
       (1) Health care provider.--The term ``health care 
     provider'' means anyone licensed under State law to provide 
     health care services, including a practitioner such as a 
     nurse anesthetist or chiropractor who is so licensed.
       (2) Health plan.--The term ``health plan'' means any public 
     or private health plan or arrangement (including an employee 
     welfare benefit plan) which provides, or pays the cost of, 
     health benefits, and includes an organization of health care 
     providers that furnishes health services under a contract or 
     agreement with such a plan.
       (3) Coverage of third party administrators.--In the case of 
     a health plan that is an employee welfare benefit plan (as 
     defined in section 3(1) of the Employee Retirement Income 
     Security Act of 1974), any third party administrator or other 
     person with responsibility for contracts with health care 
     providers under the plan shall be considered, for purposes of 
     this section, to be an entity offering such health plan.
       (e) Non-Preemption of State Law.--A State may establish or 
     enforce requirements with respect to the subject matter of 
     this section, but only if such requirements are consistent 
     with the Act and are more protective of medical 
     communications than the requirements established under this 
     section.
       (g) Effective Date.--Subsection (a) shall take effect 180 
     days after the date of the enactment of this Act and shall 
     apply to medical communications made on or after such date.
                                 ______