[Congressional Record Volume 145, Number 101 (Friday, July 16, 1999)]
[Senate]
[Pages S8741-S8768]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                  PATIENTS' BILL OF RIGHTS ACT OF 1999

  The text of S. 1344, passed by the Senate on July 15, 1999, follows:

                                S. 1344

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Patients' 
     Bill of Rights Plus Act''.
       (b) Table Of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.

                   TITLE I--PATIENTS' BILL OF RIGHTS

                  Subtitle A--Right to Advice and Care

Sec. 101. Patient right to medical advice and care.


         ``SUBPART C--PATIENT RIGHT TO MEDICAL ADVICE AND CARE

``Sec. 721. Patient access to emergency medical care.
``Sec. 722. Offering of choice of coverage options.
``Sec. 723. Patient access to obstetric and gynecological care.
``Sec. 724. Patient access to pediatric care.
``Sec. 725. Timely access to specialists.
``Sec. 726. Continuity of care.
``Sec. 727. Protection of patient-provider communications.
``Sec. 728. Patient's right to prescription drugs.
``Sec. 729. Self-payment for behavioral health care services.
``Sec. 730. Coverage for individuals participating in approved cancer 
              clinical trials.
``Sec. 730A. Prohibiting discrimination against providers.
``Sec. 730B. Generally applicable provision.''.
Sec. 102. Conforming amendment to the Internal Revenue Code of 1986.


        ``SUBCHAPTER C--PATIENT RIGHT TO MEDICAL ADVICE AND CARE

``Sec. 9821. Patient access to emergency medical care.
``Sec. 9822. Offering of choice of coverage options.
``Sec. 9823. Patient access to obstetric and gynecological care.
``Sec. 9824. Patient access to pediatric care.
``Sec. 9825. Timely access to specialists.
``Sec. 9826. Continuity of care.
``Sec. 9827. Protection of patient-provider communications.
``Sec. 9828. Patient's right to prescription drugs.
``Sec. 9829. Self-payment for behavioral health care services.
``Sec. 9830. Coverage for individuals participating in approved cancer 
              clinical trials.
``Sec. 9830A. Prohibiting discrimination against providers.
``Sec. 9830B. Generally applicable provision.''.
Sec. 103. Effective date and related rules.

       Subtitle B--Right to Information About Plans and Providers

Sec. 111. Information about plans.
Sec. 112. Information about providers.

           Subtitle C--Right to Hold Health Plans Accountable

Sec. 121. Amendment to Employee Retirement Income Security Act of 1974.

               TITLE II--WOMEN'S HEALTH AND CANCER RIGHTS

Sec. 201. Women's health and cancer rights.

              TITLE III--GENETIC INFORMATION AND SERVICES

Sec. 301. Short title.
Sec. 302. Amendments to Employee Retirement Income Security Act of 
              1974.
Sec. 303. Amendments to the Public Health Service Act.
Sec. 304. Amendments to the Internal Revenue Code of 1986.

               TITLE IV--HEALTHCARE RESEARCH AND QUALITY

Sec. 401. Short title.
Sec. 402. Amendment to the Public Health Service Act.

         ``TITLE IX--AGENCY FOR HEALTHCARE RESEARCH AND QUALITY

               ``Part A--Establishment and General Duties

``Sec. 901. Mission and duties.
``Sec. 902. General authorities.

               ``Part B--Healthcare Improvement Research

``Sec. 911. Healthcare outcome improvement research.
``Sec. 912. Private-public partnerships to improve organization and 
              delivery.
``Sec. 913. Information on quality and cost of care.

[[Page S8742]]

``Sec. 914. Information systems for healthcare improvement.
``Sec. 915. Research supporting primary care and access in underserved 
              areas.
``Sec. 916. Clinical practice and technology innovation.
``Sec. 917. Coordination of Federal government quality improvement 
              efforts.

                      ``Part C--General Provisions

``Sec. 921. Advisory Council for Healthcare Research and Quality.
``Sec. 922. Peer review with respect to grants and contracts.
``Sec. 923. Certain provisions with respect to development, collection, 
              and dissemination of data.
``Sec. 924. Dissemination of information.
``Sec. 925. Additional provisions with respect to grants and contracts.
``Sec. 926. Certain administrative authorities.
``Sec. 927. Funding.
``Sec. 928. Definitions.''.
Sec. 403. References.

         TITLE V--ENHANCED ACCESS TO HEALTH INSURANCE COVERAGE

Sec. 501. Full deduction of health insurance costs for self-employed 
              individuals.
Sec. 502. Full availability of medical savings accounts.
Sec. 503. Permitting contribution towards medical savings account 
              through Federal employees health benefits program 
              (FEHBP).
Sec. 504. Carryover of unused benefits from cafeteria plans, flexible 
              spending arrangements, and health flexible spending 
              accounts.

       TITLE VI--PROVISIONS RELATING TO LONG-TERM CARE INSURANCE

Sec. 601. Inclusion of qualified long-term care insurance contracts in 
              cafeteria plans, flexible spending arrangements, and 
              health flexible spending accounts.
Sec. 602. Deduction for premiums for long-term care insurance.
Sec. 603. Study of long-term care needs in the 21st century.

                 TITLE VII--INDIVIDUAL RETIREMENT PLANS

Sec. 701. Modification of income limits on contributions and rollovers 
              to Roth IRAs.

                     TITLE VIII--REVENUE PROVISIONS

Sec. 801. Modification to foreign tax credit carryback and carryover 
              periods.
Sec. 802. Limitation on use of non-accrual experience method of 
              accounting.
Sec. 803. Returns relating to cancellations of indebtedness by 
              organizations lending money.
Sec. 804. Extension of Internal Revenue Service user fees.
Sec. 805. Property subject to a liability treated in same manner as 
              assumption of liability.
Sec. 806. Charitable split-dollar life insurance, annuity, and 
              endowment contracts.
Sec. 807. Transfer of excess defined benefit plan assets for retiree 
              health benefits.
Sec. 808. Limitations on welfare benefit funds of 10 or more employer 
              plans.
Sec. 809. Modification of installment method and repeal of installment 
              method for accrual method taxpayers.
Sec. 810. Inclusion of certain vaccines against streptococcus 
              pneumoniae to list of taxable vaccines.

                   TITLE IX--MISCELLANEOUS PROVISIONS

Sec. 901. Medicare competitive pricing demonstration project.

                   TITLE I--PATIENTS' BILL OF RIGHTS

                  Subtitle A--Right to Advice and Care

     SEC. 101. PATIENT RIGHT TO MEDICAL ADVICE AND CARE.

       (a) In General.--Part 7 of subtitle B of title I of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1181 et seq.) is amended--
       (1) by redesignating subpart C as subpart D; and
       (2) by inserting after subpart B the following:

         ``Subpart C--Patient Right to Medical Advice and Care

     ``SEC. 721. PATIENT ACCESS TO EMERGENCY MEDICAL CARE.

       ``(a) Coverage of Emergency Care.--
       ``(1) In general.--To the extent that the group health plan 
     (other than a fully insured group health plan) provides 
     coverage for benefits consisting of emergency medical care 
     (as defined in subsection (c)) or emergency ambulance 
     services, except for items or services specifically 
     excluded--
       ``(A) the plan shall provide coverage for benefits, without 
     requiring preauthorization, for emergency medical screening 
     examinations or emergency ambulance services, to the extent 
     that a prudent layperson, who possesses an average knowledge 
     of health and medicine, would determine such examinations or 
     emergency ambulance services to be necessary to determine 
     whether emergency medical care (as so defined) is necessary; 
     and
       ``(B) the plan shall provide coverage for benefits, without 
     requiring preauthorization, for additional emergency medical 
     care to stabilize an emergency medical condition following an 
     emergency medical screening examination (if determined 
     necessary under subparagraph (A)), pursuant to the definition 
     of stabilize under section 1867(e)(3) of the Social Security 
     Act (42 U.S.C. 1395dd(e)(3)).
       ``(2) Reimbursement for care to maintain medical 
     stability.--
       ``(A) In general.--In the case of services provided to a 
     participant or beneficiary by a nonparticipating provider in 
     order to maintain the medical stability of the participant or 
     beneficiary, the group health plan involved shall provide for 
     reimbursement with respect to such services if--
       ``(i) coverage for services of the type furnished is 
     available under the group health plan;
       ``(ii) the services were provided for care related to an 
     emergency medical condition and in an emergency department in 
     order to maintain the medical stability of the participant or 
     beneficiary; and
       ``(iii) the nonparticipating provider contacted the plan 
     regarding approval for such services.
       ``(B) Failure to respond.--If a group health plan fails to 
     respond within 1 hours of being contacted in accordance with 
     subparagraph (A)(iii), then the plan shall be liable for the 
     cost of services provided by the nonparticipating provider in 
     order to maintain the stability of the participant or 
     beneficiary.
       ``(C) Limitation.--The liability of a group health plan to 
     provide reimbursement under subparagraph (A) shall terminate 
     when the plan has contacted the nonparticipating provider to 
     arrange for discharge or transfer.
       ``(D) Liability of participant.--A participant or 
     beneficiary shall not be liable for the costs of services to 
     which subparagraph (A) in an amount that exceeds the amount 
     of liability that would be incurred if the services were 
     provided by a participating health care provider with prior 
     authorization by the plan.
       ``(b) In-Network Uniform Costs-Sharing and Out-of-Network 
     Care.--
       ``(1) In-network uniform cost-sharing.--Nothing in this 
     section shall be construed as preventing a group health plan 
     (other than a fully insured group health plan) from imposing 
     any form of cost-sharing applicable to any participant or 
     beneficiary (including coinsurance, copayments, deductibles, 
     and any other charges) in relation to coverage for benefits 
     described in subsection (a), if such form of cost-sharing is 
     uniformly applied under such plan, with respect to similarly 
     situated participants and beneficiaries, to all benefits 
     consisting of emergency medical care (as defined in 
     subsection (c)) provided to such similarly situated 
     participants and beneficiaries under the plan, and such cost-
     sharing is disclosed in accordance with section 714.
       ``(2) Out-of-network care.--If a group health plan (other 
     than a fully insured group health plan) provides any benefits 
     with respect to emergency medical care (as defined in 
     subsection (c)), the plan shall cover emergency medical care 
     under the plan in a manner so that, if such care is provided 
     to a participant or beneficiary by a nonparticipating health 
     care provider, the participant or beneficiary is not liable 
     for amounts that exceed any form of cost-sharing (including 
     co-insurance, co-payments, deductibles, and any other 
     charges) that would be incurred if the services were provided 
     by a participating provider.
       ``(c) Definition of Emergency Medical Care.--In this 
     section:
       ``(1) In general.--The term `emergency medical care' means, 
     with respect to a participant or beneficiary under a group 
     health plan (other than a fully insured group health plan), 
     covered inpatient and outpatient services that--
       ``(A) are furnished by any provider, including a 
     nonparticipating provider, that is qualified to furnish such 
     services; and
       ``(B) are needed to evaluate or stabilize (as such term is 
     defined in section 1867(e)(3) of the Social Security Act (42 
     U.S.C. 1395dd)(e)(3)) an emergency medical condition (as 
     defined in paragraph (2)).
       ``(2) Emergency medical condition.--The term `emergency 
     medical condition' means a medical condition manifesting 
     itself by acute symptoms of sufficient severity (including 
     severe pain) such that a prudent layperson, who possesses an 
     average knowledge of health and medicine, could reasonably 
     expect the absence of immediate medical attention to result 
     in--
       ``(A) placing the health of the participant or beneficiary 
     (or, with respect to a pregnant woman, the health of the 
     woman or her unborn child) in serious jeopardy,
       ``(B) serious impairment to bodily functions, or
       ``(C) serious dysfunction of any bodily organ or part.

     ``SEC. 722. OFFERING OF CHOICE OF COVERAGE OPTIONS.

       ``(a) Requirement.--
       ``(1) Offering of point-of-service coverage option.--Except 
     as provided in paragraph (2), if a group health plan (other 
     than a fully insured group health plan) provides coverage for 
     benefits only through a defined set of participating health 
     care professionals, the plan shall offer the participant the 
     option to purchase point-of-service coverage (as defined in 
     subsection (b)) for all such benefits for which coverage is 
     otherwise

[[Page S8743]]

     so limited. Such option shall be made available to the 
     participant at the time of enrollment under the plan and at 
     such other times as the plan offers the participant a choice 
     of coverage options.
       ``(2) Exception in case of lack of availability.--Paragraph 
     (1) shall not apply with respect to a group health plan 
     (other than a fully insured group health plan) if care 
     relating to the point-of-service coverage would not be 
     available and accessible to the participant with reasonable 
     promptness (consistent with section 1301(b)(4) of the Public 
     Health Service Act (42 U.S.C. 300e(b)(4))).
       ``(b) Point-of-Service Coverage Defined.--In this section, 
     the term `point-of-service coverage' means, with respect to 
     benefits covered under a group health plan (other than a 
     fully insured group health plan), coverage of such benefits 
     when provided by a nonparticipating health care professional.
       ``(c) Small Employer Exemption.--
       ``(1) In general.--This section shall not apply to any 
     group health plan (other than a fully insured group health 
     plan) of a small employer.
       ``(2) Small employer.--For purposes of paragraph (1), the 
     term `small employer' means, in connection with a group 
     health plan (other than a fully insured group health plan) 
     with respect to a calendar year and a plan year, an employer 
     who employed an average of at least 2 but not more than 50 
     employees on business days during the preceding calendar year 
     and who employs at least 2 employees on the first day of the 
     plan year. For purposes of this paragraph, the provisions of 
     subparagraph (C) of section 712(c)(1) shall apply in 
     determining employer size.
       ``(d) Rule of Construction.--Nothing in this section shall 
     be construed--
       ``(1) as requiring coverage for benefits for a particular 
     type of health care professional;
       ``(2) as requiring an employer to pay any costs as a result 
     of this section or to make equal contributions with respect 
     to different health coverage options;
       ``(3) as preventing a group health plan (other than a fully 
     insured group health plan) from imposing higher premiums or 
     cost-sharing on a participant for the exercise of a point-of-
     service coverage option; or
       ``(4) to require that a group health plan (other than a 
     fully insured group health plan) include coverage of health 
     care professionals that the plan excludes because of fraud, 
     quality of care, or other similar reasons with respect to 
     such professionals.

     ``SEC. 723. PATIENT ACCESS TO OBSTETRIC AND GYNECOLOGICAL 
                   CARE.

       ``(a) General Rights.--
       ``(1) Waiver of plan referral requirement.--If a group 
     health plan described in subsection (b) requires a referral 
     to obtain coverage for specialty care, the plan shall waive 
     the referral requirement in the case of a female participant 
     or beneficiary who seeks coverage for obstetrical care and 
     related follow-up obstetrical care or routine gynecological 
     care (such as preventive gynecological care).
       ``(2) Related routine care.--With respect to a participant 
     or beneficiary described in paragraph (1), a group health 
     plan described in subsection (b) shall treat the ordering of 
     other routine care that is related to routine gynecologic 
     care, by a physician who specializes in obstetrics and 
     gynecology as the authorization of the primary care provider 
     for such other care.
       ``(b) Application of Section.--A group health plan 
     described in this subsection is a group health plan (other 
     than a fully insured group health plan), that--
       ``(1) provides coverage for obstetric care (such as 
     pregnancy-related services) or routine gynecologic care (such 
     as preventive women's health examinations); and
       ``(2) requires the designation by a participant or 
     beneficiary of a participating primary care provider who is 
     not a physician who specializes in obstetrics or gynecology.
       ``(c) Rules of Construction.--Nothing in this section shall 
     be construed--
       ``(1) as waiving any coverage requirement relating to 
     medical necessity or appropriateness with respect to the 
     coverage of obstetric or gynecologic care described in 
     subsection (a);
       ``(2) to preclude the plan from requiring that the 
     physician who specializes in obstetrics or gynecology notify 
     the designated primary care provider or the plan of treatment 
     decisions;
       ``(3) to preclude a group health plan from allowing health 
     care professionals other than physicians to provide routine 
     obstetric or routine gynecologic care; or
       ``(4) to preclude a group health plan from permitting a 
     physician who specializes in obstetrics and gynecology from 
     being a primary care provider under the plan.

     ``SEC. 724. PATIENT ACCESS TO PEDIATRIC CARE.

       ``(a) In General.--In the case of a group health plan 
     (other than a fully insured group health plan) that provides 
     coverage for routine pediatric care and that requires the 
     designation by a participant or beneficiary of a 
     participating primary care provider, if the designated 
     primary care provider is not a physician who specializes in 
     pediatrics--
       ``(1) the plan may not require authorization or referral by 
     the primary care provider in order for a participant or 
     beneficiary to obtain coverage for routine pediatric care; 
     and
       ``(2) the plan shall treat the ordering of other routine 
     care related to routine pediatric care by such a specialist 
     as having been authorized by the designated primary care 
     provider.
       ``(b) Rules of Construction.--Nothing in subsection (a) 
     shall be construed--
       ``(1) as waiving any coverage requirement relating to 
     medical necessity or appropriateness with respect to the 
     coverage of any pediatric care provided to, or ordered for, a 
     participant or beneficiary;
       ``(2) to preclude a group health plan from requiring that a 
     specialist described in subsection (a) notify the designated 
     primary care provider or the plan of treatment decisions; or
       ``(3) to preclude a group health plan from allowing health 
     care professionals other than physicians to provide routine 
     pediatric care.

     ``SEC. 725. TIMELY ACCESS TO SPECIALISTS.

       ``(a) Timely Access.--
       ``(1) In general.--A group health plan (other than a fully 
     insured group health plan) shall ensure that participants and 
     beneficiaries have timely, in accordance with the medical 
     exigencies of the case, access to primary and specialty 
     health care professionals who are appropriate to the 
     condition of the participant or beneficiary, when such care 
     is covered under the plan. Such access may be provided 
     through contractual arrangements with specialized providers 
     outside of the network of the plan.
       ``(2) Rule of construction.--Nothing in paragraph (1) shall 
     be construed--
       ``(A) to require the coverage under a group health plan of 
     particular benefits or services or to prohibit a plan from 
     including providers only to the extent necessary to meet the 
     needs of the plan's participants or beneficiaries or from 
     establishing any measure designed to maintain quality and 
     control costs consistent with the responsibilities of the 
     plan; or
       ``(B) to override any State licensure or scope-of-practice 
     law.
       ``(b) Treatment Plans.--
       ``(1) In general.--Nothing in this section shall be 
     construed to prohibit a group health plan (other than a fully 
     insured group health plan) from requiring that specialty care 
     be provided pursuant to a treatment plan so long as the 
     treatment plan is--
       ``(A) developed by the specialist, in consultation with the 
     case manager or primary care provider, and the participant or 
     beneficiary;
       ``(B) approved by the plan in a timely manner in accordance 
     with the medical exigencies of the case; and
       ``(C) in accordance with the applicable quality assurance 
     and utilization review standards of the plan.
       ``(2) Notification.--Nothing in paragraph (1) shall be 
     construed as prohibiting a plan from requiring the specialist 
     to provide the case manager or primary care provider with 
     regular updates on the specialty care provided, as well as 
     all other necessary medical information.
       ``(c) Referrals.--Nothing in this section shall be 
     construed to prohibit a plan from requiring an authorization 
     by the case manager or primary care provider of the 
     participant or beneficiary in order to obtain coverage for 
     specialty services so long as such authorization is for an 
     adequate number of referrals.
       ``(d) Specialty Care Defined.--For purposes of this 
     subsection, the term `specialty care' means, with respect to 
     a condition, care and treatment provided by a health care 
     practitioner, facility, or center (such as a center of 
     excellence) that has adequate expertise (including age-
     appropriate expertise) through appropriate training and 
     experience.

     ``SEC. 726. CONTINUITY OF CARE.

       ``(a) In General.--
       ``(1) Termination of provider.--If a contract between a 
     group health plan (other than a fully insured group health 
     plan) and a health care provider is terminated (as defined in 
     paragraph (2)), or benefits or coverage provided by a health 
     care provider are terminated because of a change in the terms 
     of provider participation in such group health plan, and an 
     individual who is a participant or beneficiary in the plan is 
     undergoing a course of treatment from the provider at the 
     time of such termination, the plan shall--
       ``(A) notify the individual on a timely basis of such 
     termination;
       ``(B) provide the individual with an opportunity to notify 
     the plan of a need for transitional care; and
       ``(C) in the case of termination described in paragraph 
     (2), (3), or (4) of subsection (b), and subject to subsection 
     (c), permit the individual to continue or be covered with 
     respect to the course of treatment with the provider's 
     consent during a transitional period (as provided under 
     subsection (b)).
       ``(2) Terminated.--In this section, the term `terminated' 
     includes, with respect to a contract, the expiration or 
     nonrenewal of the contract by the group health plan, but does 
     not include a termination of the contract by the plan for 
     failure to meet applicable quality standards or for fraud.
       ``(3) Contracts.--For purposes of this section, the term 
     `contract between a group health plan (other than a fully 
     insured group health plan) and a health care provider' shall 
     include a contract between such a plan and an organized 
     network of providers.
       ``(b) Transitional Period.--
       ``(1) General rule.--Except as provided in paragraph (3), 
     the transitional period under this subsection shall permit 
     the participant or beneficiary to extend the coverage 
     involved for up to 90 days from the date of the notice 
     described in subsection (a)(1)(A) of the provider's 
     termination.

[[Page S8744]]

       ``(2) Institutional care.--Subject to paragraph (1), the 
     transitional period under this subsection for institutional 
     or inpatient care from a provider shall extend until the 
     discharge or termination of the period of 
     institutionalization and also shall include institutional 
     care provided within a reasonable time of the date of 
     termination of the provider status if the care was scheduled 
     before the date of the announcement of the termination of the 
     provider status under subsection (a)(1)(A) or if the 
     individual on such date was on an established waiting list or 
     otherwise scheduled to have such care.
       ``(3) Pregnancy.--Notwithstanding paragraph (1), if--
       ``(A) a participant or beneficiary has entered the second 
     trimester of pregnancy at the time of a provider's 
     termination of participation; and
       ``(B) the provider was treating the pregnancy before the 
     date of the termination;
     the transitional period under this subsection with respect to 
     provider's treatment of the pregnancy shall extend through 
     the provision of post-partum care directly related to the 
     delivery.
       ``(4) Terminal illness.--Notwithstanding paragraph (1), 
     if--
       ``(A) a participant or beneficiary was determined to be 
     terminally ill (as determined under section 1861(dd)(3)(A) of 
     the Social Security Act) prior to a provider's termination of 
     participation; and
       ``(B) the provider was treating the terminal illness before 
     the date of termination;

     the transitional period under this subsection shall be for 
     care directly related to the treatment of the terminal 
     illness and shall extend for the remainder of the 
     individual's life for such care.
       ``(c) Permissible Terms and Conditions.--A group health 
     plan (other than a fully insured group health plan) may 
     condition coverage of continued treatment by a provider under 
     subsection (a)(1)(C) upon the provider agreeing to the 
     following terms and conditions:
       ``(1) The provider agrees to accept reimbursement from the 
     plan and individual involved (with respect to cost-sharing) 
     at the rates applicable prior to the start of the 
     transitional period as payment in full (or at the rates 
     applicable under the replacement plan after the date of the 
     termination of the contract with the group health plan) and 
     not to impose cost-sharing with respect to the individual in 
     an amount that would exceed the cost-sharing that could have 
     been imposed if the contract referred to in subsection (a)(1) 
     had not been terminated.
       ``(2) The provider agrees to adhere to the quality 
     assurance standards of the plan responsible for payment under 
     paragraph (1) and to provide to such plan necessary medical 
     information related to the care provided.
       ``(3) The provider agrees otherwise to adhere to such 
     plan's policies and procedures, including procedures 
     regarding referrals and obtaining prior authorization and 
     providing services pursuant to a treatment plan (if any) 
     approved by the plan.
       ``(d) Rule of Construction.--Nothing in this section shall 
     be construed to require the coverage of benefits which would 
     not have been covered if the provider involved remained a 
     participating provider.
       ``(e) Definition.--In this section, the term `health care 
     provider' or `provider' means--
       ``(1) any individual who is engaged in the delivery of 
     health care services in a State and who is required by State 
     law or regulation to be licensed or certified by the State to 
     engage in the delivery of such services in the State; and
       ``(2) any entity that is engaged in the delivery of health 
     care services in a State and that, if it is required by State 
     law or regulation to be licensed or certified by the State to 
     engage in the delivery of such services in the State, is so 
     licensed.
       ``(f) Comprehensive Study of Cost, Quality and Coordination 
     of Coverage for Patients at the End of Life.--
       ``(1) Study by the medicare payment advisory commission.--
     The Medicare Payment Advisory Commission shall conduct a 
     study of the costs and patterns of care for persons with 
     serious and complex conditions and the possibilities of 
     improving upon that care to the degree it is triggered by the 
     current category of terminally ill as such term is used for 
     purposes of section 1861(dd) of the Social Security Act 
     (relating to hospice benefits) or of utilizing care in other 
     payment settings in Medicare.
       ``(2) Agency for health care policy and research.--The 
     Agency for Health Care Policy and Research shall conduct 
     studies of the possible thresholds for major conditions 
     causing serious and complex illness, their administrative 
     parameters and feasibility, and their impact upon costs and 
     quality.
       ``(3) Health care financing administration.--The Health 
     Care Financing Administration shall conduct studies of the 
     merits of applying similar thresholds in Medicare+Choice 
     programs, including adapting risk adjustment methods to 
     account for this category.
       ``(4) Initial report.--
       ``(A) In general.--Not later than 12 months after the date 
     of enactment of this section, the Medicare Payment Advisory 
     Commission and the Agency for Health Care Policy and Research 
     shall each prepare and submit to the Committee on Health, 
     Education, Labor and Pensions of the Senate a report 
     concerning the results of the studies conducted under 
     paragraphs (1) and (2), respectively.
       ``(B) Copy to secretary.--Concurrent with the submission of 
     the reports under subparagraph (A), the Medicare Payment 
     Advisory Commission and the Agency for health Care Policy and 
     Research shall transmit a copy of the reports under such 
     subparagraph to the Secretary.
       ``(5) Final report.--
       ``(A) Contract with institute of medicine.--Not later than 
     1 year after the submission of the reports under paragraph 
     (4), the Secretary of Health and Human Services shall 
     contract with the Institute of Medicine to conduct a study of 
     the practices and their effects arising from the utilization 
     of the category ``serious and complex'' illness.
       ``(B) Report.--Not later than 1 year after the date of the 
     execution of the contract referred to in subparagraph (A), 
     the Institute of Medicine shall prepare and submit to the 
     Committee on Health, Education, Labor and Pensions of the 
     Senate a report concerning the study conducted pursuant to 
     such contract.
       ``(6) Funding.--From funds appropriated to the Department 
     of Health and Human Services, the Secretary of Health and 
     Human Services shall make available such funds as the 
     Secretary determines is necessary to carry out this 
     subsection.

     ``SEC. 727. PROTECTION OF PATIENT-PROVIDER COMMUNICATIONS.

       ``(a) In General.--Subject to subsection (b), a group 
     health plan (other than a fully insured group health plan and 
     in relation to a participant or beneficiary) shall not 
     prohibit or otherwise restrict a health care professional 
     from advising such a participant or beneficiary who is a 
     patient of the professional about the health status of the 
     participant or beneficiary or medical care or treatment for 
     the condition or disease of the participant or beneficiary, 
     regardless of whether coverage for such care or treatment are 
     provided under the contract, if the professional is acting 
     within the lawful scope of practice.
       ``(b) Rule of Construction.--Nothing in this section shall 
     be construed as requiring a group health plan (other than a 
     fully insured group health plan) to provide specific benefits 
     under the terms of such plan.

     ``SEC. 728. PATIENT'S RIGHT TO PRESCRIPTION DRUGS.

       ``To the extent that a group health plan (other than a 
     fully insured group health plan) provides coverage for 
     benefits with respect to prescription drugs, and limits such 
     coverage to drugs included in a formulary, the plan shall--
       ``(1) ensure the participation of physicians and 
     pharmacists in developing and reviewing such formulary; and
       ``(2) in accordance with the applicable quality assurance 
     and utilization review standards of the plan, provide for 
     exceptions from the formulary limitation when a non-formulary 
     alternative is medically necessary and appropriate.

     ``SEC. 729. SELF-PAYMENT FOR BEHAVIORAL HEALTH CARE SERVICES.

       ``(a) In General.--A group health plan (other than a fully 
     insured group health plan) may not--
       ``(1) prohibit or otherwise discourage a participant or 
     beneficiary from self-paying for behavioral health care 
     services once the plan has denied coverage for such services; 
     or
       ``(2) terminate a health care provider because such 
     provider permits participants or beneficiaries to self-pay 
     for behavioral health care services--
       ``(A) that are not otherwise covered under the plan; or
       ``(B) for which the group health plan provides limited 
     coverage, to the extent that the group health plan denies 
     coverage of the services.
       ``(b) Rule of Construction.--Nothing in subsection 
     (a)(2)(B) shall be construed as prohibiting a group health 
     plan from terminating a contract with a health care provider 
     for failure to meet applicable quality standards or for 
     fraud.

     ``SEC. 730. COVERAGE FOR INDIVIDUALS PARTICIPATING IN 
                   APPROVED CANCER CLINICAL TRIALS.

       ``(a) Coverage.--
       ``(1) In general.--If a group health plan (other than a 
     fully insured group health plan) provides coverage to a 
     qualified individual (as defined in subsection (b)), the 
     plan--
       ``(A) may not deny the individual participation in the 
     clinical trial referred to in subsection (b)(2);
       ``(B) subject to subsections (b), (c), and (d) may not deny 
     (or limit or impose additional conditions on) the coverage of 
     routine patient costs for items and services furnished in 
     connection with participation in the trial; and
       ``(C) may not discriminate against the individual on the 
     basis of the participant's or beneficiaries participation in 
     such trial.
       ``(2) Exclusion of certain costs.--For purposes of 
     paragraph (1)(B), routine patient costs do not include the 
     cost of the tests or measurements conducted primarily for the 
     purpose of the clinical trial involved.
       ``(3) Use of in-network providers.--If one or more 
     participating providers is participating in a clinical trial, 
     nothing in paragraph (1) shall be construed as preventing a 
     plan from requiring that a qualified individual participate 
     in the trial through such a participating provider if the 
     provider will accept the individual as a participant in the 
     trial.
       ``(b) Qualified Individual Defined.--For purposes of 
     subsection (a), the term ``qualified individual'' means an 
     individual who is a

[[Page S8745]]

     participant or beneficiary in a group health plan and who 
     meets the following conditions:
       ``(1)(A) The individual has been diagnosed with cancer for 
     which no standard treatment is effective.
       ``(B) The individual is eligible to participate in an 
     approved clinical trial according to the trial protocol with 
     respect to treatment of such illness.
       ``(C) The individual's participation in the trial offers 
     meaningful potential for significant clinical benefit for the 
     individual.
       ``(2) Either--
       ``(A) the referring physician is a participating health 
     care professional and has concluded that the individual's 
     participation in such trial would be appropriate based upon 
     the individual meeting the conditions described in paragraph 
     (1); or
       ``(B) the participant or beneficiary provides medical and 
     scientific information establishing that the individual's 
     participation in such trial would be appropriate based upon 
     the individual meeting the conditions described in paragraph 
     (1).
       ``(c) Payment.--
       ``(1) In general.--Under this section a group health plan 
     (other than a fully insured group health plan) shall provide 
     for payment for routine patient costs described in subsection 
     (a)(2) but is not required to pay for costs of items and 
     services that are reasonably expected to be paid for by the 
     sponsors of an approved clinical trial.
       ``(2) Standards for determining routine patient costs 
     associated with clinical trial participation.--
       ``(A) In general.--The Secretary shall establish, on an 
     expedited basis and using a negotiated rulemaking process 
     under subchapter III of chapter 5 of title 5, United States 
     Code, standards relating to the coverage of routine patient 
     costs for individuals participating in clinical trials that 
     group health plans must meet under this section.
       ``(B) Factors.--In establishing routine patient cost 
     standards under subparagraph (A), the Secretary shall consult 
     with interested parties and take into account --
       ``(i) quality of patient care;
       ``(ii) routine patient care costs versus costs associated 
     with the conduct of clinical trials, including unanticipated 
     patient care costs as a result of participation in clinical 
     trials; and
       ``(iii) previous and on-going studies relating to patient 
     care costs associated with participation in clinical trials.
       ``(C) Publication of notice.--In carrying out the 
     rulemaking process under this paragraph, the Secretary, after 
     consultation with organizations representing cancer patients, 
     health care practitioners, medical researchers, employers, 
     group health plans, manufacturers of drugs, biologics and 
     medical devices, medical economists, hospitals, and other 
     interested parties, shall publish notice provided for under 
     section 564(a) of title 5, United States Code, by not later 
     than 45 days after the date of the enactment of this section.
       ``(D) Target date for publication of rule.--As part of the 
     notice under subparagraph (C), and for purposes of this 
     paragraph, the `target date for publication' (referred to in 
     section 564(a)(5) of such title 5) shall be June 30, 2000.
       ``(E) Abbreviated period for submission of comments.--In 
     applying section 564(c) of such title 5 under this paragraph, 
     `15 days' shall be substituted for `30 days'.
       ``(F) Appointment of negotiated rulemaking committee and 
     facilitator.--The Secretary shall provide for--
       ``(i) the appointment of a negotiated rulemaking committee 
     under section 565(a) of such title 5 by not later than 30 
     days after the end of the comment period provided for under 
     section 564(c) of such title 5 (as shortened under 
     subparagraph (E)), and
       ``(ii) the nomination of a facilitator under section 566(c) 
     of such title 5 by not later than 10 days after the date of 
     appointment of the committee.
       ``(G) Preliminary committee report.--The negotiated 
     rulemaking committee appointed under subparagraph (F) shall 
     report to the Secretary, by not later than March 29, 2000, 
     regarding the committee's progress on achieving a consensus 
     with regard to the rulemaking proceeding and whether such 
     consensus is likely to occur before 1 month before the target 
     date for publication of the rule. If the committee reports 
     that the committee has failed to make significant progress 
     towards such consensus or is unlikely to reach such consensus 
     by the target date, the Secretary may terminate such process 
     and provide for the publication of a rule under this 
     paragraph through such other methods as the Secretary may 
     provide.
       ``(H) Final committee report.--If the committee is not 
     terminated under subparagraph (G), the rulemaking committee 
     shall submit a report containing a proposed rule by not later 
     than 1 month before the target date of publication.
       ``(I) Final effect.--The Secretary shall publish a rule 
     under this paragraph in the Federal Register by not later 
     than the target date of publication.
       ``(J) Publication of rule after public comment.--The 
     Secretary shall provide for consideration of such comments 
     and republication of such rule by not later than 1 year after 
     the target date of publication.
       ``(K) Effective date.--The provisions of this paragraph 
     shall apply to group health plans (other than a fully insured 
     group health plan) for plan years beginning on or after 
     January 1, 2001.
       ``(3) Payment rate.--In the case of covered items and 
     services provided by--
       ``(A) a participating provider, the payment rate shall be 
     at the agreed upon rate, or
       ``(B) a nonparticipating provider, the payment rate shall 
     be at the rate the plan would normally pay for comparable 
     services under subparagraph (A).
       ``(d) Approved Clinical Trial Defined.--
       ``(1) In general.--In this section, the term `approved 
     clinical trial' means a cancer clinical research study or 
     cancer clinical investigation approved and funded (which may 
     include funding through in-kind contributions) by one or more 
     of the following:
       ``(A) The National Institutes of Health.
       ``(B) A cooperative group or center of the National 
     Institutes of Health.
       ``(C) Either of the following if the conditions described 
     in paragraph (2) are met:
       ``(i) The Department of Veterans Affairs.
       ``(ii) The Department of Defense.
       ``(2) Conditions for departments.--The conditions described 
     in this paragraph, for a study or investigation conducted by 
     a Department, are that the study or investigation has been 
     reviewed and approved through a system of peer review that 
     the Secretary determines--
       ``(A) to be comparable to the system of peer review of 
     studies and investigations used by the National Institutes of 
     Health, and
       ``(B) assures unbiased review of the highest scientific 
     standards by qualified individuals who have no interest in 
     the outcome of the review.
       ``(e) Construction.--Nothing in this section shall be 
     construed to limit a plan's coverage with respect to clinical 
     trials.
       ``(f) Plan Satisfaction of Certain Requirements; 
     Responsibilities of Fiduciaries.--
       ``(1) In general.--For purposes of this section, insofar as 
     a group health plan provides benefits in the form of health 
     insurance coverage through a health insurance issuer, the 
     plan shall be treated as meeting the requirements of this 
     section with respect to such benefits and not be considered 
     as failing to meet such requirements because of a failure of 
     the issuer to meet such requirements so long as the plan 
     sponsor or its representatives did not cause such failure by 
     the issuer.
       ``(2) Construction.--Nothing in this section shall be 
     construed to affect or modify the responsibilities of the 
     fiduciaries of a group health plan under part 4 of subtitle 
     B.
       ``(g) Study and Report.--
       ``(1) Study.--The Secretary shall study the impact on group 
     health plans for covering routine patient care costs for 
     individuals who are entitled to benefits under this section 
     and who are enrolled in an approved cancer clinical trial 
     program.
       ``(2) Report to congress.--Not later than January 1, 2005, 
     the Secretary shall submit a report to Congress that contains 
     an assessment of--
       ``(A) any incremental cost to group health plans resulting 
     from the provisions of this section;
       ``(B) a projection of expenditures to such plans resulting 
     from this section; and
       ``(C) any impact on premiums resulting from this section.

     ``SEC. 730A. PROHIBITING DISCRIMINATION AGAINST PROVIDERS.

       ``(a) In General.--A group health plan (other than a fully 
     insured group health plan) shall not discriminate with 
     respect to participation or indemnification as to any 
     provider who is acting within the scope of the provider's 
     license or certification under applicable State law, solely 
     on the basis of such license or certification. This 
     subsection shall not be construed as requiring the coverage 
     under a plan of particular benefits or services or to 
     prohibit a plan from including providers only to the extent 
     necessary to meet the needs of the plan's participants and 
     beneficiaries or from establishing any measure designed to 
     maintain quality and control costs consistent with the 
     responsibilities of the plan.
       ``(b) No Requirement for any Willing Provider.--Nothing in 
     this section shall be construed as requiring a group health 
     plan that offers network coverage to include for 
     participation every willing provider or health professional 
     who meets the terms and conditions of the plan.

     ``SEC. 730B. GENERALLY APPLICABLE PROVISION.

       ``In the case of a group health plan that provides benefits 
     under 2 or more coverage options, the requirements of this 
     subpart shall apply separately with respect to each coverage 
     option.''.
       (b) Rule With Respect to Certain Plans.--
       (1) In general.--Notwithstanding any other provision of 
     law, health insurance issuers may offer, and eligible 
     individuals may purchase, high deductible health plans 
     described in section 220(c)(2)(A) of the Internal Revenue 
     Code of 1986. Effective for the 4-year period beginning on 
     the date of the enactment of this Act, such health plans 
     shall not be required to provide payment for any health care 
     items or services that are exempt from the plan's deductible.
       (2) Existing state laws.--A State law relating to payment 
     for health care items and services in effect on the date of 
     enactment of this Act that is preempted under paragraph (1), 
     shall not apply to high deductible health plans after the 
     expiration of the 4-year period described in such paragraph 
     unless the State reenacts such law after such period.
       (c) Definition.--Section 733(a) of the Employee Retirement 
     Income Security Act of 1974 (42 U.S.C. 1191(a)) is amended by 
     adding at the end the following:

[[Page S8746]]

       ``(3) Fully insured group health plan.--The term `fully 
     insured group health plan' means a group health plan where 
     benefits under the plan are provided pursuant to the terms of 
     an arrangement between a group health plan and a health 
     insurance issuer and are guaranteed by the health insurance 
     issuer under a contract or policy of insurance.''.
       (d) Conforming Amendment.--The table of contents in section 
     1 of such Act is amended--
       (1) in the item relating to subpart C, by striking 
     ``Subpart C'' and inserting ``Subpart D''; and
       (2) by adding at the end of the items relating to subpart B 
     of part 7 of subtitle B of title I of such Act the following 
     new items:

         ``Subpart C--Patient Right to Medical Advice and Care

``Sec. 721. Patient access to emergency medical care.
``Sec. 722. Offering of choice of coverage options.
``Sec. 723. Patient access to obstetric and gynecological care.
``Sec. 724. Patient access to pediatric care.
``Sec. 725. Timely access to specialists.
``Sec. 726. Continuity of care.
``Sec. 727. Protection of patient-provider communications.
``Sec. 728. Patient's right to prescription drugs.
``Sec. 729. Self-payment for behavioral health care services.
``Sec. 730. Coverage for individuals participating in approved cancer 
              clinical trials.
``Sec. 730A. Prohibiting discrimination against providers.
``Sec. 730B. Generally applicable provision.''.

     SEC. 102. CONFORMING AMENDMENT TO THE INTERNAL REVENUE CODE 
                   OF 1986.

       (a) In General.--Chapter 100 of the Internal Revenue Code 
     of 1986 is amended--
       (1) by redesignating subchapter C as subchapter D; and
       (2) by inserting after subchapter B the following:

        ``Subchapter C--Patient Right to Medical Advice and Care

``Sec. 9821. Patient access to emergency medical care.
``Sec. 9822. Offering of choice of coverage options.
``Sec. 9823. Patient access to obstetric and gynecological care.
``Sec. 9824. Patient access to pediatric care.
``Sec. 9825. Timely access to specialists.
``Sec. 9826. Continuity of care.
``Sec. 9827. Protection of patient-provider communications.
``Sec. 9828. Patient's right to prescription drugs.
``Sec. 9829. Self-payment for behavioral health care services.
``Sec. 9830. Coverage for individuals participating in approved cancer 
              clinical trials.
``Sec. 9830A. Prohibiting discrimination against providers.
``Sec. 9830B. Generally applicable provision.

     ``SEC. 9821. PATIENT ACCESS TO EMERGENCY MEDICAL CARE.

       ``(a) Coverage of Emergency Care.--
       ``(1) In general.--To the extent that the group health plan 
     (other than a fully insured group health plan) provides 
     coverage for benefits consisting of emergency medical care 
     (as defined in subsection (c)) or emergency ambulance 
     services, except for items or services specifically 
     excluded--
       ``(A) the plan shall provide coverage for benefits, without 
     requiring preauthorization, for emergency medical screening 
     examinations or emergency ambulance services, to the extent 
     that a prudent layperson, who possesses an average knowledge 
     of health and medicine, would determine such examinations or 
     emergency ambulance services to be necessary to determine 
     whether emergency medical care (as so defined) is necessary; 
     and
       ``(B) the plan shall provide coverage for benefits, without 
     requiring preauthorization, for additional emergency medical 
     care to stabilize an emergency medical condition following an 
     emergency medical screening examination (if determined 
     necessary under subparagraph (A)), pursuant to the definition 
     of stabilize under section 1867(e)(3) of the Social Security 
     Act (42 U.S.C. 1395dd(e)(3)).
       ``(2) Reimbursement for care to maintain medical 
     stability.--
       ``(A) In general.--In the case of services provided to a 
     participant or beneficiary by a nonparticipating provider in 
     order to maintain the medical stability of the participant or 
     beneficiary, the group health plan involved shall provide for 
     reimbursement with respect to such services if--
       ``(i) coverage for services of the type furnished is 
     available under the group health plan;
       ``(ii) the services were provided for care related to an 
     emergency medical condition and in an emergency department in 
     order to maintain the medical stability of the participant or 
     beneficiary; and
       ``(iii) the nonparticipating provider contacted the plan 
     regarding approval for such services.
       ``(B) Failure to respond.--If a group health plan fails to 
     respond within 1 hours of being contacted in accordance with 
     subparagraph (A)(iii), then the plan shall be liable for the 
     cost of services provided by the nonparticipating provider in 
     order to maintain the stability of the participant or 
     beneficiary.
       ``(C) Limitation.--The liability of a group health plan to 
     provide reimbursement under subparagraph (A) shall terminate 
     when the plan has contacted the nonparticipating provider to 
     arrange for discharge or transfer.
       ``(D) Liability of participant.--A participant or 
     beneficiary shall not be liable for the costs of services to 
     which subparagraph (A) in an amount that exceeds the amount 
     of liability that would be incurred if the services were 
     provided by a participating health care provider with prior 
     authorization by the plan.
       ``(b) In-Network Uniform Costs-Sharing and Out-of-Network 
     Care.--
       ``(1) In-network uniform cost-sharing.--Nothing in this 
     section shall be construed as preventing a group health plan 
     (other than a fully insured group health plan) from imposing 
     any form of cost-sharing applicable to any participant or 
     beneficiary (including coinsurance, copayments, deductibles, 
     and any other charges) in relation to coverage for benefits 
     described in subsection (a), if such form of cost-sharing is 
     uniformly applied under such plan, with respect to similarly 
     situated participants and beneficiaries, to all benefits 
     consisting of emergency medical care (as defined in 
     subsection (c)) provided to such similarly situated 
     participants and beneficiaries under the plan, and such cost-
     sharing is disclosed in accordance with section 9814.
       ``(2) Out-of-network care.--If a group health plan (other 
     than a fully insured group health plan) provides any benefits 
     with respect to emergency medical care (as defined in 
     subsection (c)), the plan shall cover emergency medical care 
     under the plan in a manner so that, if such care is provided 
     to a participant or beneficiary by a nonparticipating health 
     care provider, the participant or beneficiary is not liable 
     for amounts that exceed any form of cost-sharing (including 
     coinsurance, copayments, deductibles, and any other charges) 
     that would be incurred if the services were provided by a 
     participating provider.
       ``(c) Definition of Emergency Medical Care.--In this 
     section:
       ``(1) In general.--The term `emergency medical care' means, 
     with respect to a participant or beneficiary under a group 
     health plan (other than a fully insured group health plan), 
     covered inpatient and outpatient services that--
       ``(A) are furnished by any provider, including a 
     nonparticipating provider, that is qualified to furnish such 
     services; and
       ``(B) are needed to evaluate or stabilize (as such term is 
     defined in section 1867(e)(3) of the Social Security Act (42 
     U.S.C. 1395dd)(e)(3)) an emergency medical condition (as 
     defined in paragraph (2)).
       ``(2) Emergency medical condition.--The term `emergency 
     medical condition' means a medical condition manifesting 
     itself by acute symptoms of sufficient severity (including 
     severe pain) such that a prudent layperson, who possesses an 
     average knowledge of health and medicine, could reasonably 
     expect the absence of immediate medical attention to result 
     in--
       ``(A) placing the health of the participant or beneficiary 
     (or, with respect to a pregnant woman, the health of the 
     woman or her unborn child) in serious jeopardy,
       ``(B) serious impairment to bodily functions, or
       ``(C) serious dysfunction of any bodily organ or part.

     ``SEC. 9822. OFFERING OF CHOICE OF COVERAGE OPTIONS.

       ``(a) Requirement.--
       ``(1) Offering of point-of-service coverage option.--Except 
     as provided in paragraph (2), if a group health plan (other 
     than a fully insured group health plan) provides coverage for 
     benefits only through a defined set of participating health 
     care professionals, the plan shall offer the participant the 
     option to purchase point-of-service coverage (as defined in 
     subsection (b)) for all such benefits for which coverage is 
     otherwise so limited. Such option shall be made available to 
     the participant at the time of enrollment under the plan and 
     at such other times as the plan offers the participant a 
     choice of coverage options.
       ``(2) Exception in case of lack of availability.--Paragraph 
     (1) shall not apply with respect to a group health plan 
     (other than a fully insured group health plan) if care 
     relating to the point-of-service coverage would not be 
     available and accessible to the participant with reasonable 
     promptness (consistent with section 1301(b)(4) of the Public 
     Health Service Act (42 U.S.C. 300e(b)(4))).
       ``(b) Point-of-Service Coverage Defined.--In this section, 
     the term `point-of-service coverage' means, with respect to 
     benefits covered under a group health plan (other than a 
     fully insured group health plan), coverage of such benefits 
     when provided by a nonparticipating health care professional.
       ``(c) Small Employer Exemption.--
       ``(1) In general.--This section shall not apply to any 
     group health plan (other than a fully insured group health 
     plan) of a small employer.
       ``(2) Small employer.--For purposes of paragraph (1), the 
     term `small employer' means, in connection with a group 
     health plan (other than a fully insured group health plan) 
     with respect to a calendar year and a plan year, an employer 
     who employed an average of at least 2 but not more than 50 
     employees on business days during the preceding calendar year 
     and who employs at least 2 employees on the first day of the 
     plan year. For purposes of this paragraph, the

[[Page S8747]]

     provisions of subparagraph (C) of section 4980D(d)(2) shall 
     apply in determining employer size.
       ``(d) Rule of Construction.--Nothing in this section shall 
     be construed--
       ``(1) as requiring coverage for benefits for a particular 
     type of health care professional;
       ``(2) as requiring an employer to pay any costs as a result 
     of this section or to make equal contributions with respect 
     to different health coverage options;
       ``(3) as preventing a group health plan (other than a fully 
     insured group health plan) from imposing higher premiums or 
     cost-sharing on a participant for the exercise of a point-of-
     service coverage option; or
       ``(4) to require that a group health plan (other than a 
     fully insured group health plan) include coverage of health 
     care professionals that the plan excludes because of fraud, 
     quality of care, or other similar reasons with respect to 
     such professionals.

     ``SEC. 9823. PATIENT ACCESS TO OBSTETRIC AND GYNECOLOGICAL 
                   CARE.

       ``(a) General Rights.--
       ``(1) Waiver of plan referral requirement.--If a group 
     health plan described in subsection (b) requires a referral 
     to obtain coverage for specialty care, the plan shall waive 
     the referral requirement in the case of a female participant 
     or beneficiary who seeks coverage for obstetrical care and 
     related follow-up obstetrical care or routine gynecological 
     care (such as preventive gynecological care).
       ``(2) Related routine care.--With respect to a participant 
     or beneficiary described in paragraph (1), a group health 
     plan described in subsection (b) shall treat the ordering of 
     other routine care that is related to routine gynecologic 
     care, by a physician who specializes in obstetrics and 
     gynecology as the authorization of the primary care provider 
     for such other care.
       ``(b) Application of Section.--A group health plan 
     described in this subsection is a group health plan (other 
     than a fully insured group health plan), that--
       ``(1) provides coverage for obstetric care (such as 
     pregnancy-related services) or routine gynecologic care (such 
     as preventive women's health examinations); and
       ``(2) requires the designation by a participant or 
     beneficiary of a participating primary care provider who is 
     not a physician who specializes in obstetrics or gynecology.
       ``(c) Rules of Construction.--Nothing in this section shall 
     be construed--
       ``(1) as waiving any coverage requirement relating to 
     medical necessity or appropriateness with respect to the 
     coverage of obstetric or gynecologic care described in 
     subsection (a);
       ``(2) to preclude the plan from requiring that the 
     physician who specializes in obstetrics or gynecology notify 
     the designated primary care provider or the plan of treatment 
     decisions;
       ``(3) to preclude a group health plan from allowing health 
     care professionals other than physicians to provide routine 
     obstetric or routine gynecologic care; or
       ``(4) to preclude a group health plan from permitting a 
     physician who specializes in obstetrics and gynecology from 
     being a primary care provider under the plan.

     ``SEC. 9824. PATIENT ACCESS TO PEDIATRIC CARE.

       ``(a) In General.--In the case of a group health plan 
     (other than a fully insured group health plan) that provides 
     coverage for routine pediatric care and that requires the 
     designation by a participant or beneficiary of a 
     participating primary care provider, if the designated 
     primary care provider is not a physician who specializes in 
     pediatrics--
       ``(1) the plan may not require authorization or referral by 
     the primary care provider in order for a participant or 
     beneficiary to obtain coverage for routine pediatric care; 
     and
       ``(2) the plan shall treat the ordering of other routine 
     care related to routine pediatric care by such a specialist 
     as having been authorized by the designated primary care 
     provider.
       ``(b) Rules of Construction.--Nothing in subsection (a) 
     shall be construed--
       ``(1) as waiving any coverage requirement relating to 
     medical necessity or appropriateness with respect to the 
     coverage of any pediatric care provided to, or ordered for, a 
     participant or beneficiary;
       ``(2) to preclude a group health plan from requiring that a 
     specialist described in subsection (a) notify the designated 
     primary care provider or the plan of treatment decisions; or
       ``(3) to preclude a group health plan from allowing health 
     care professionals other than physicians to provide routine 
     pediatric care.

     ``SEC. 9825. TIMELY ACCESS TO SPECIALISTS.

       ``(a) Timely Access.--
       ``(1) In general.--A group health plan (other than a fully 
     insured group health plan) shall ensure that participants and 
     beneficiaries have timely, in accordance with the medical 
     exigencies of the case, access to primary and specialty 
     health care professionals who are appropriate to the 
     condition of the participant or beneficiary, when such care 
     is covered under the plan. Such access may be provided 
     through contractual arrangements with specialized providers 
     outside of the network of the plan.
       ``(2) Rule of construction.--Nothing in paragraph (1) shall 
     be construed--
       ``(A) to require the coverage under a group health plan of 
     particular benefits or services or to prohibit a plan from 
     including providers only to the extent necessary to meet the 
     needs of the plan's participants or beneficiaries or from 
     establishing any measure designed to maintain quality and 
     control costs consistent with the responsibilities of the 
     plan; or
       ``(B) to override any State licensure or scope-of-practice 
     law.
       ``(b) Treatment Plans.--
       ``(1) In general.--Nothing in this section shall be 
     construed to prohibit a group health plan (other than a fully 
     insured group health plan) from requiring that specialty care 
     be provided pursuant to a treatment plan so long as the 
     treatment plan is--
       ``(A) developed by the specialist, in consultation with the 
     case manager or primary care provider, and the participant or 
     beneficiary;
       ``(B) approved by the plan in a timely manner in accordance 
     with the medical exigencies of the case; and
       ``(C) in accordance with the applicable quality assurance 
     and utilization review standards of the plan.
       ``(2) Notification.--Nothing in paragraph (1) shall be 
     construed as prohibiting a plan from requiring the specialist 
     to provide the case manager or primary care provider with 
     regular updates on the specialty care provided, as well as 
     all other necessary medical information.
       ``(c) Referrals.--Nothing in this section shall be 
     construed to prohibit a plan from requiring an authorization 
     by the case manager or primary care provider of the 
     participant or beneficiary in order to obtain coverage for 
     specialty services so long as such authorization is for an 
     adequate number of referrals.
       ``(d) Specialty Care Defined.--For purposes of this 
     subsection, the term `specialty care' means, with respect to 
     a condition, care and treatment provided by a health care 
     practitioner, facility, or center (such as a center of 
     excellence) that has adequate expertise (including age-
     appropriate expertise) through appropriate training and 
     experience.

     ``SEC. 9826. CONTINUITY OF CARE.

       ``(a) In General.--
       ``(1) Termination of provider.--If a contract between a 
     group health plan (other than a fully insured group health 
     plan) and a health care provider is terminated (as defined in 
     paragraph (2)), or benefits or coverage provided by a health 
     care provider are terminated because of a change in the terms 
     of provider participation in such group health plan, and an 
     individual who is a participant or beneficiary in the plan is 
     undergoing a course of treatment from the provider at the 
     time of such termination, the plan shall--
       ``(A) notify the individual on a timely basis of such 
     termination;
       ``(B) provide the individual with an opportunity to notify 
     the plan of a need for transitional care; and
       ``(C) in the case of termination described in paragraph 
     (2), (3), or (4) of subsection (b), and subject to subsection 
     (c), permit the individual to continue or be covered with 
     respect to the course of treatment with the provider's 
     consent during a transitional period (as provided under 
     subsection (b)).
       ``(2) Terminated.--In this section, the term `terminated' 
     includes, with respect to a contract, the expiration or 
     nonrenewal of the contract by the group health plan, but does 
     not include a termination of the contract by the plan for 
     failure to meet applicable quality standards or for fraud.
       ``(3) Contracts.--For purposes of this section, the term 
     `contract between a group health plan (other than a fully 
     insured group health plan) and a health care provider' shall 
     include a contract between such a plan and an organized 
     network of providers.
       ``(b) Transitional Period.--
       ``(1) General rule.--Except as provided in paragraph (3), 
     the transitional period under this subsection shall permit 
     the participant or beneficiary to extend the coverage 
     involved for up to 90 days from the date of the notice 
     described in subsection (a)(1)(A) of the provider's 
     termination.
       ``(2) Institutional care.--Subject to paragraph (1), the 
     transitional period under this subsection for institutional 
     or inpatient care from a provider shall extend until the 
     discharge or termination of the period of 
     institutionalization and also shall include institutional 
     care provided within a reasonable time of the date of 
     termination of the provider status if the care was scheduled 
     before the date of the announcement of the termination of the 
     provider status under subsection (a)(1)(A) or if the 
     individual on such date was on an established waiting list or 
     otherwise scheduled to have such care.
       ``(3) Pregnancy.--Notwithstanding paragraph (1), if--
       ``(A) a participant or beneficiary has entered the second 
     trimester of pregnancy at the time of a provider's 
     termination of participation; and
       ``(B) the provider was treating the pregnancy before the 
     date of the termination;

     the transitional period under this subsection with respect to 
     provider's treatment of the pregnancy shall extend through 
     the provision of post-partum care directly related to the 
     delivery.
       ``(4) Terminal illness.--Notwithstanding paragraph (1), 
     if--
       ``(A) a participant or beneficiary was determined to be 
     terminally ill (as determined under section 1861(dd)(3)(A) of 
     the Social Security Act) prior to a provider's termination of 
     participation; and
       ``(B) the provider was treating the terminal illness before 
     the date of termination;


[[Page S8748]]


     the transitional period under this subsection shall be for 
     care directly related to the treatment of the terminal 
     illness and shall extend for the remainder of the 
     individual's life for such care.
       ``(c) Permissible Terms and Conditions.--A group health 
     plan (other than a fully insured group health plan) may 
     condition coverage of continued treatment by a provider under 
     subsection (a)(1)(C) upon the provider agreeing to the 
     following terms and conditions:
       ``(1) The provider agrees to accept reimbursement from the 
     plan and individual involved (with respect to cost-sharing) 
     at the rates applicable prior to the start of the 
     transitional period as payment in full (or at the rates 
     applicable under the replacement plan after the date of the 
     termination of the contract with the group health plan) and 
     not to impose cost-sharing with respect to the individual in 
     an amount that would exceed the cost-sharing that could have 
     been imposed if the contract referred to in subsection (a)(1) 
     had not been terminated.
       ``(2) The provider agrees to adhere to the quality 
     assurance standards of the plan responsible for payment under 
     paragraph (1) and to provide to such plan necessary medical 
     information related to the care provided.
       ``(3) The provider agrees otherwise to adhere to such 
     plan's policies and procedures, including procedures 
     regarding referrals and obtaining prior authorization and 
     providing services pursuant to a treatment plan (if any) 
     approved by the plan.
       ``(d) Rule of Construction.--Nothing in this section shall 
     be construed to require the coverage of benefits which would 
     not have been covered if the provider involved remained a 
     participating provider.
       ``(e) Definition.--In this section, the term `health care 
     provider' or `provider' means--
       ``(1) any individual who is engaged in the delivery of 
     health care services in a State and who is required by State 
     law or regulation to be licensed or certified by the State to 
     engage in the delivery of such services in the State; and
       ``(2) any entity that is engaged in the delivery of health 
     care services in a State and that, if it is required by State 
     law or regulation to be licensed or certified by the State to 
     engage in the delivery of such services in the State, is so 
     licensed.
       ``(f) Comprehensive Study of Cost, Quality and Coordination 
     of Coverage for Patients at the End of Life.--
       ``(1) Study by the medicare payment advisory commission.--
     The Medicare Payment Advisory Commission shall conduct a 
     study of the costs and patterns of care for persons with 
     serious and complex conditions and the possibilities of 
     improving upon that care to the degree it is triggered by the 
     current category of terminally ill as such term is used for 
     purposes of section 1861(dd) of the Social Security Act 
     (relating to hospice benefits) or of utilizing care in other 
     payment settings in Medicare.
       ``(2) Agency for health care policy and research.--The 
     Agency for Health Care Policy and Research shall conduct 
     studies of the possible thresholds for major conditions 
     causing serious and complex illness, their administrative 
     parameters and feasibility, and their impact upon costs and 
     quality.
       ``(3) Health care financing administration.--The Health 
     Care Financing Administration shall conduct studies of the 
     merits of applying similar thresholds in Medicare+Choice 
     programs, including adapting risk adjustment methods to 
     account for this category.
       ``(4) Initial report.--
       ``(A) In general.--Not later than 12 months after the date 
     of enactment of this section, the Medicare Payment Advisory 
     Commission and the Agency for Health Care Policy and Research 
     shall each prepare and submit to the Committee on Health, 
     Education, Labor and Pensions of the Senate a report 
     concerning the results of the studies conducted under 
     paragraphs (1) and (2), respectively.
       ``(B) Copy to secretary.--Concurrent with the submission of 
     the reports under subparagraph (A), the Medicare Payment 
     Advisory Commission and the Agency for health Care Policy and 
     Research shall transmit a copy of the reports under such 
     subparagraph to the Secretary.
       ``(5) Final report.--
       ``(A) Contract with institute of medicine.--Not later than 
     1 year after the submission of the reports under paragraph 
     (4), the Secretary of Health and Human Services shall 
     contract with the Institute of Medicine to conduct a study of 
     the practices and their effects arising from the utilization 
     of the category ``serious and complex'' illness.
       ``(B) Report.--Not later than 1 year after the date of the 
     execution of the contract referred to in subparagraph (A), 
     the Institute of Medicine shall prepare and submit to the 
     Committee on Health, Education, Labor and Pensions of the 
     Senate a report concerning the study conducted pursuant to 
     such contract.
       ``(6) Funding.--From funds appropriated to the Department 
     of Health and Human Services, the Secretary of Health and 
     Human Services shall make available such funds as the 
     Secretary determines is necessary to carry out this 
     subsection.

     ``SEC. 9827. PROTECTION OF PATIENT-PROVIDER COMMUNICATIONS.

       ``(a) In General.--Subject to subsection (b), a group 
     health plan (other than a fully insured group health plan and 
     in relation to a participant or beneficiary) shall not 
     prohibit or otherwise restrict a health care professional 
     from advising such a participant or beneficiary who is a 
     patient of the professional about the health status of the 
     participant or beneficiary or medical care or treatment for 
     the condition or disease of the participant or beneficiary, 
     regardless of whether coverage for such care or treatment are 
     provided under the contract, if the professional is acting 
     within the lawful scope of practice.
       ``(b) Rule of Construction.--Nothing in this section shall 
     be construed as requiring a group health plan (other than a 
     fully insured group health plan) to provide specific benefits 
     under the terms of such plan.

     ``SEC. 9828. PATIENT'S RIGHT TO PRESCRIPTION DRUGS.

       ``To the extent that a group health plan (other than a 
     fully insured group health plan) provides coverage for 
     benefits with respect to prescription drugs, and limits such 
     coverage to drugs included in a formulary, the plan shall--
       ``(1) ensure the participation of physicians and 
     pharmacists in developing and reviewing such formulary; and
       ``(2) in accordance with the applicable quality assurance 
     and utilization review standards of the plan, provide for 
     exceptions from the formulary limitation when a non-formulary 
     alternative is medically necessary and appropriate.

     ``SEC. 9829. SELF-PAYMENT FOR BEHAVIORAL HEALTH CARE 
                   SERVICES.

       ``(a) In General.--A group health plan (other than a fully 
     insured group health plan) may not--
       ``(1) prohibit or otherwise discourage a participant or 
     beneficiary from self-paying for behavioral health care 
     services once the plan has denied coverage for such services; 
     or
       ``(2) terminate a health care provider because such 
     provider permits participants or beneficiaries to self-pay 
     for behavioral health care services--
       ``(A) that are not otherwise covered under the plan; or
       ``(B) for which the group health plan provides limited 
     coverage, to the extent that the group health plan denies 
     coverage of the services.
       ``(b) Rule of Construction.--Nothing in subsection 
     (a)(2)(B) shall be construed as prohibiting a group health 
     plan from terminating a contract with a health care provider 
     for failure to meet applicable quality standards or for 
     fraud.

     ``SEC. 9830. COVERAGE FOR INDIVIDUALS PARTICIPATING IN 
                   APPROVED CANCER CLINICAL TRIALS.

       ``(a) Coverage.--
       ``(1) In general.--If a group health plan (other than a 
     fully insured group health plan) provides coverage to a 
     qualified individual (as defined in subsection (b)), the 
     plan--
       ``(A) may not deny the individual participation in the 
     clinical trial referred to in subsection (b)(2);
       ``(B) subject to subsections (b), (c), and (d) may not deny 
     (or limit or impose additional conditions on) the coverage of 
     routine patient costs for items and services furnished in 
     connection with participation in the trial; and
       ``(C) may not discriminate against the individual on the 
     basis of the participant's or beneficiaries participation in 
     such trial.
       ``(2) Exclusion of certain costs.--For purposes of 
     paragraph (1)(B), routine patient costs do not include the 
     cost of the tests or measurements conducted primarily for the 
     purpose of the clinical trial involved.
       ``(3) Use of in-network providers.--If one or more 
     participating providers is participating in a clinical trial, 
     nothing in paragraph (1) shall be construed as preventing a 
     plan from requiring that a qualified individual participate 
     in the trial through such a participating provider if the 
     provider will accept the individual as a participant in the 
     trial.
       ``(b) Qualified Individual Defined.--For purposes of 
     subsection (a), the term ``qualified individual'' means an 
     individual who is a participant or beneficiary in a group 
     health plan and who meets the following conditions:
       ``(1)(A) The individual has been diagnosed with cancer for 
     which no standard treatment is effective.
       ``(B) The individual is eligible to participate in an 
     approved clinical trial according to the trial protocol with 
     respect to treatment of such illness.
       ``(C) The individual's participation in the trial offers 
     meaningful potential for significant clinical benefit for the 
     individual.
       ``(2) Either--
       ``(A) the referring physician is a participating health 
     care professional and has concluded that the individual's 
     participation in such trial would be appropriate based upon 
     the individual meeting the conditions described in paragraph 
     (1); or
       ``(B) the participant or beneficiary provides medical and 
     scientific information establishing that the individual's 
     participation in such trial would be appropriate based upon 
     the individual meeting the conditions described in paragraph 
     (1).
       ``(c) Payment.--
       ``(1) In general.--Under this section a group health plan 
     (other than a fully insured group health plan) shall provide 
     for payment for routine patient costs described in subsection 
     (a)(2) but is not required to pay for costs of items and 
     services that are reasonably expected to be paid for by the 
     sponsors of an approved clinical trial.

[[Page S8749]]

       ``(2) Standards for determining routine patient costs 
     associated with clinical trial participation.--
       ``(A) In general.--The Secretary shall establish, on an 
     expedited basis and using a negotiated rulemaking process 
     under subchapter III of chapter 5 of title 5, United States 
     Code, standards relating to the coverage of routine patient 
     costs for individuals participating in clinical trials that 
     group health plans must meet under this section.
       ``(B) Factors.--In establishing routine patient cost 
     standards under subparagraph (A), the Secretary shall consult 
     with interested parties and take into account --
       ``(i) quality of patient care;
       ``(ii) routine patient care costs versus costs associated 
     with the conduct of clinical trials, including unanticipated 
     patient care costs as a result of participation in clinical 
     trials; and
       ``(iii) previous and on-going studies relating to patient 
     care costs associated with participation in clinical trials.
       ``(C) Publication of notice.--In carrying out the 
     rulemaking process under this paragraph, the Secretary, after 
     consultation with organizations representing cancer patients, 
     health care practitioners, medical researchers, employers, 
     group health plans, manufacturers of drugs, biologics and 
     medical devices, medical economists, hospitals, and other 
     interested parties, shall publish notice provided for under 
     section 564(a) of title 5, United States Code, by not later 
     than 45 days after the date of the enactment of this section.
       ``(D) Target date for publication of rule.--As part of the 
     notice under subparagraph (C), and for purposes of this 
     paragraph, the `target date for publication' (referred to in 
     section 564(a)(5) of such title 5) shall be June 30, 2000.
       ``(E) Abbreviated period for submission of comments.--In 
     applying section 564(c) of such title 5 under this paragraph, 
     `15 days' shall be substituted for `30 days'.
       ``(F) Appointment of negotiated rulemaking committee and 
     facilitator.--The Secretary shall provide for--
       ``(i) the appointment of a negotiated rulemaking committee 
     under section 565(a) of such title 5 by not later than 30 
     days after the end of the comment period provided for under 
     section 564(c) of such title 5 (as shortened under 
     subparagraph (E)), and
       ``(ii) the nomination of a facilitator under section 566(c) 
     of such title 5 by not later than 10 days after the date of 
     appointment of the committee.
       ``(G) Preliminary committee report.--The negotiated 
     rulemaking committee appointed under subparagraph (F) shall 
     report to the Secretary, by not later than March 29, 2000, 
     regarding the committee's progress on achieving a consensus 
     with regard to the rulemaking proceeding and whether such 
     consensus is likely to occur before 1 month before the target 
     date for publication of the rule. If the committee reports 
     that the committee has failed to make significant progress 
     towards such consensus or is unlikely to reach such consensus 
     by the target date, the Secretary may terminate such process 
     and provide for the publication of a rule under this 
     paragraph through such other methods as the Secretary may 
     provide.
       ``(H) Final committee report.--If the committee is not 
     terminated under subparagraph (G), the rulemaking committee 
     shall submit a report containing a proposed rule by not later 
     than 1 month before the target date of publication.
       ``(I) Final effect.--The Secretary shall publish a rule 
     under this paragraph in the Federal Register by not later 
     than the target date of publication.
       ``(J) Publication of rule after public comment.--The 
     Secretary shall provide for consideration of such comments 
     and republication of such rule by not later than 1 year after 
     the target date of publication.
       ``(K) Effective date.--The provisions of this paragraph 
     shall apply to group health plans (other than a fully insured 
     group health plan) for plan years beginning on or after 
     January 1, 2001.
       ``(3) Payment rate.--In the case of covered items and 
     services provided by--
       ``(A) a participating provider, the payment rate shall be 
     at the agreed upon rate, or
       ``(B) a nonparticipating provider, the payment rate shall 
     be at the rate the plan would normally pay for comparable 
     services under subparagraph (A).
       ``(d) Approved Clinical Trial Defined.--
       ``(1) In general.--In this section, the term `approved 
     clinical trial' means a cancer clinical research study or 
     cancer clinical investigation approved and funded (which may 
     include funding through in-kind contributions) by one or more 
     of the following:
       ``(A) The National Institutes of Health.
       ``(B) A cooperative group or center of the National 
     Institutes of Health.
       ``(C) Either of the following if the conditions described 
     in paragraph (2) are met:
       ``(i) The Department of Veterans Affairs.
       ``(ii) The Department of Defense.
       ``(2) Conditions for departments.--The conditions described 
     in this paragraph, for a study or investigation conducted by 
     a Department, are that the study or investigation has been 
     reviewed and approved through a system of peer review that 
     the Secretary determines--
       ``(A) to be comparable to the system of peer review of 
     studies and investigations used by the National Institutes of 
     Health, and
       ``(B) assures unbiased review of the highest scientific 
     standards by qualified individuals who have no interest in 
     the outcome of the review.
       ``(e) Construction.--Nothing in this section shall be 
     construed to limit a plan's coverage with respect to clinical 
     trials.
       ``(f) Plan Satisfaction of Certain Requirements; 
     Responsibilities of Fiduciaries.--
       ``(1) In general.--For purposes of this section, insofar as 
     a group health plan provides benefits in the form of health 
     insurance coverage through a health insurance issuer, the 
     plan shall be treated as meeting the requirements of this 
     section with respect to such benefits and not be considered 
     as failing to meet such requirements because of a failure of 
     the issuer to meet such requirements so long as the plan 
     sponsor or its representatives did not cause such failure by 
     the issuer.
       ``(2) Construction.--Nothing in this section shall be 
     construed to affect or modify the responsibilities of the 
     fiduciaries of a group health plan under part 4 of subtitle B 
     of title I of the Employee Retirement Income Security Act of 
     1974.
       ``(g) Study and Report.--
       ``(1) Study.--The Secretary shall study the impact on group 
     health plans for covering routine patient care costs for 
     individuals who are entitled to benefits under this section 
     and who are enrolled in an approved cancer clinical trial 
     program.
       ``(2) Report to congress.--Not later than January 1, 2005, 
     the Secretary shall submit a report to Congress that contains 
     an assessment of--
       ``(A) any incremental cost to group health plans resulting 
     from the provisions of this section;
       ``(B) a projection of expenditures to such plans resulting 
     from this section; and
       ``(C) any impact on premiums resulting from this section.

     ``SEC. 9830A. PROHIBITING DISCRIMINATION AGAINST PROVIDERS.

       ``(a) In General.--A group health plan (other than a fully 
     insured group health plan) shall not discriminate with 
     respect to participation or indemnification as to any 
     provider who is acting within the scope of the provider's 
     license or certification under applicable State law, solely 
     on the basis of such license or certification. This 
     subsection shall not be construed as requiring the coverage 
     under a plan of particular benefits or services or to 
     prohibit a plan from including providers only to the extent 
     necessary to meet the needs of the plan's participants and 
     beneficiaries or from establishing any measure designed to 
     maintain quality and control costs consistent with the 
     responsibilities of the plan.
       ``(b) No Requirement for any Willing Provider.--Nothing in 
     this section shall be construed as requiring a group health 
     plan that offers network coverage to include for 
     participation every willing provider or health professional 
     who meets the terms and conditions of the plan.

     ``SEC. 9830B. GENERALLY APPLICABLE PROVISION.

       ``In the case of a group health plan that provides benefits 
     under 2 or more coverage options, the requirements of this 
     subchapter shall apply separately with respect to each 
     coverage option.''.
       (b) Definition.--Section 9832(b) of the Internal Revenue 
     Code of 1986 is amended by adding at the end the following:
       ``(4) Fully insured group health plan.--The term `fully 
     insured group health plan' means a group health plan where 
     benefits under the plan are provided pursuant to the terms of 
     an arrangement between a group health plan and a health 
     insurance issuer and are guaranteed by the health insurance 
     issuer under a contract or policy of insurance.''.
       (c) Conforming Amendment.--Chapter 98 of the Internal 
     Revenue Code of 1986 is amended in the table of subchapters 
     in the item relating to subchapter C, by striking 
     ``Subchapter C'' and inserting ``Subchapter D''.

     SEC. 103. EFFECTIVE DATE AND RELATED RULES.

       (a) In General.--The amendments made by this subtitle shall 
     apply with respect to plan years beginning on or after 
     January 1 of the second calendar year following the date of 
     the enactment of this Act. The Secretary shall issue all 
     regulations necessary to carry out the amendments made by 
     this section before the effective date thereof.
       (b) Limitation on Enforcement Actions.--No enforcement 
     action shall be taken, pursuant to the amendments made by 
     this subtitle, against a group health plan with respect to a 
     violation of a requirement imposed by such amendments before 
     the date of issuance of regulations issued in connection with 
     such requirement, if the plan has sought to comply in good 
     faith with such requirement.

       Subtitle B--Right to Information About Plans and Providers

     SEC. 111. INFORMATION ABOUT PLANS.

       (a) Employee Retirement Income Security Act of 1974.--
       (1) In general.--Subpart B of part 7 of subtitle B of title 
     I of the Employee Retirement Income Security Act of 1974 (29 
     U.S.C. 1185 et seq.) is amended by adding at the end the 
     following:

     ``SEC. 714. HEALTH PLAN COMPARATIVE INFORMATION.

       ``(a) Requirement.--
       ``(1) In general.--A group health plan, and a health 
     insurance issuer that provides coverage in connection with 
     group health insurance coverage, shall, not later than 12 
     months after the date of enactment of this

[[Page S8750]]

     section, and at least annually thereafter, provide for the 
     disclosure, in a clear and accurate form to each participant 
     and each beneficiary who does not reside at the same address 
     as the participant, or upon request to an individual eligible 
     for coverage under the plan, of the information described in 
     subsection (b).
       ``(2) Rule of construction.--Nothing in this section shall 
     be construed to prevent a plan or issuer from entering into 
     any agreement under which the issuer agrees to assume 
     responsibility for compliance with the requirements of this 
     section and the plan is released from liability for such 
     compliance.
       ``(3) Provision of information.--Information shall be 
     provided to participants and beneficiaries under this section 
     at the address maintained by the plan or issuer with respect 
     to such participants or beneficiaries.
       ``(b) Required Information.--The informational materials to 
     be distributed under this section shall include for each 
     package option available under a group health plan the 
     following:
       ``(1) A description of the covered items and services under 
     each such plan and any in- and out-of-network features of 
     each such plan, including a summary description of the 
     specific exclusions from coverage under the plan.
       ``(2) A description of any cost-sharing, including 
     premiums, deductibles, coinsurance, and copayment amounts, 
     for which the participant or beneficiary will be responsible, 
     including any annual or lifetime limits on benefits, for each 
     such plan.
       ``(3) A description of any optional supplemental benefits 
     offered by each such plan and the terms and conditions 
     (including premiums or cost-sharing) for such supplemental 
     coverage.
       ``(4) A description of any restrictions on payments for 
     services furnished to a participant or beneficiary by a 
     health care professional that is not a participating 
     professional and the liability of the participant or 
     beneficiary for additional payments for these services.
       ``(5) A description of the service area of each such plan, 
     including the provision of any out-of-area coverage.
       ``(6) A description of the extent to which participants and 
     beneficiaries may select the primary care provider of their 
     choice, including providers both within the network and 
     outside the network of each such plan (if the plan permits 
     out-of-network services).
       ``(7) A description of the procedures for advance 
     directives and organ donation decisions if the plan maintains 
     such procedures.
       ``(8) A description of the requirements and procedures to 
     be used to obtain preauthorization for health services 
     (including telephone numbers and mailing addresses), 
     including referrals for specialty care.
       ``(9) A description of the definition of medical necessity 
     used in making coverage determinations by each such plan.
       ``(10) A summary of the rules and methods for appealing 
     coverage decisions and filing grievances (including telephone 
     numbers and mailing addresses), as well as other available 
     remedies.
       ``(11) A summary description of any provisions for 
     obtaining off-formulary medications if the plan utilizes a 
     defined formulary for providing specific prescription 
     medications.
       ``(12) A summary of the rules for access to emergency room 
     care. Also, any available educational material regarding 
     proper use of emergency services.
       ``(13) A description of whether or not coverage is provided 
     for experimental treatments, investigational treatments, or 
     clinical trials and the circumstances under which access to 
     such treatments or trials is made available.
       ``(14) A description of the specific preventative services 
     covered under the plan if such services are covered.
       ``(15) A statement regarding--
       ``(A) the manner in which a participant or beneficiary may 
     access an obstetrician, gynecologist, or pediatrician in 
     accordance with section 723 or 724; and
       ``(B) the manner in which a participant or beneficiary 
     obtains continuity of care as provided for in section 726.
       ``(16) A statement that the following information, and 
     instructions on obtaining such information (including 
     telephone numbers and, if available, Internet websites), 
     shall be made available upon request:
       ``(A) The names, addresses, telephone numbers, and State 
     licensure status of the plan's participating health care 
     professionals and participating health care facilities, and, 
     if available, the education, training, specialty 
     qualifications or certifications of such professionals.
       ``(B) A summary description of the methods used for 
     compensating participating health care professionals, such as 
     capitation, fee-for-service, salary, or a combination 
     thereof. The requirement of this subparagraph shall not be 
     construed as requiring plans to provide information 
     concerning proprietary payment methodology.
       ``(C) A summary description of the methods used for 
     compensating health care facilities, including per diem, fee-
     for-service, capitation, bundled payments, or a combination 
     thereof. The requirement of this subparagraph shall not be 
     construed as requiring plans to provide information 
     concerning proprietary payment methodology.
       ``(D) A summary description of the procedures used for 
     utilization review.
       ``(E) The list of the specific prescription medications 
     included in the formulary of the plan, if the plan uses a 
     defined formulary.
       ``(F) A description of the specific exclusions from 
     coverage under the plan.
       ``(G) Any available information related to the availability 
     of translation or interpretation services for non-English 
     speakers and people with communication disabilities, 
     including the availability of audio tapes or information in 
     Braille.
       ``(H) Any information that is made public by accrediting 
     organizations in the process of accreditation if the plan is 
     accredited, or any additional quality indicators that the 
     plan makes available.
       ``(c) Manner of Distribution.--The information described in 
     this section shall be distributed in an accessible format 
     that is understandable to an average plan participant or 
     beneficiary.
       ``(d) Rule of Construction.--Nothing in this section may be 
     construed to prohibit a group health plan, or health 
     insurance issuer in connection with group health insurance 
     coverage, from distributing any other additional information 
     determined by the plan or issuer to be important or necessary 
     in assisting participants and beneficiaries or upon request 
     potential participants and beneficiaries in the selection of 
     a health plan or from providing information under subsection 
     (b)(15) as part of the required information.
       ``(e) Conforming Regulations.--The Secretary shall issue 
     regulations to coordinate the requirements on group health 
     plans and health insurance issuers under this section with 
     the requirements imposed under part 1, to reduce duplication 
     with respect to any information that is required to be 
     provided under any such requirements.
       ``(f) Health Care Professional.--In this section, the term 
     `health care professional' means a physician (as defined in 
     section 1861(r) of the Social Security Act) or other health 
     care professional if coverage for the professional's services 
     is provided under the health plan involved for the services 
     of the professional. Such term includes a podiatrist, 
     optometrist, chiropractor, psychologist, dentist, physician 
     assistant, physical or occupational therapist and therapy 
     assistant, speech-language pathologist, audiologist, 
     registered or licensed practical nurse (including nurse 
     practitioner, clinical nurse specialist, certified registered 
     nurse anesthetist, and certified nurse-midwife), licensed 
     certified social worker, registered respiratory therapist, 
     and certified respiratory therapy technician.''.
       (2) Conforming amendments.--
       (A) Section 732(a) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1191a(a)) is amended by 
     striking ``section 711, and inserting ``sections 711 and 
     714''.
       (B) The table of contents in section 1 of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1001) is 
     amended by inserting after the item relating to section 713, 
     the following:

``Sec. 714. Health plan comparative information.''.
       (b) Internal Revenue Code of 1986.--Subchapter B of chapter 
     100 of the Internal Revenue Code of 1986 is amended--
       (1) in the table of sections, by inserting after the item 
     relating to section 9812 the following new item:

``Sec. 9813. Health plan comparative information.'';
     and
       (2) by inserting after section 9812 the following:

     ``SEC. 9813. HEALTH PLAN COMPARATIVE INFORMATION.

       ``(a) Requirement.--
       ``(1) In general.--A group health plan shall, not later 
     than 12 months after the date of enactment of this section, 
     and at least annually thereafter, provide for the disclosure, 
     in a clear and accurate form to each participant and each 
     beneficiary who does not reside at the same address as the 
     participant, or upon request to an individual eligible for 
     coverage under the plan, of the information described in 
     subsection (b).
       ``(2) Rules of construction.--Nothing in this section shall 
     be construed to prevent a plan from entering into any 
     agreement under which a health insurance issuer agrees to 
     assume responsibility for compliance with the requirements of 
     this section and the plan is released from liability for such 
     compliance.
       ``(3) Provision of information.--Information shall be 
     provided to participants and beneficiaries under this section 
     at the address maintained by the plan with respect to such 
     participants or beneficiaries.
       ``(b) Required Information.--The informational materials to 
     be distributed under this section shall include for each 
     package option available under a group health plan the 
     following:
       ``(1) A description of the covered items and services under 
     each such plan and any in- and out-of-network features of 
     each such plan, including a summary description of the 
     specific exclusions from coverage under the plan.
       ``(2) A description of any cost-sharing, including 
     premiums, deductibles, coinsurance, and copayment amounts, 
     for which the participant or beneficiary will be responsible, 
     including any annual or lifetime limits on benefits, for each 
     such plan.
       ``(3) A description of any optional supplemental benefits 
     offered by each such plan and the terms and conditions 
     (including premiums or cost-sharing) for such supplemental 
     coverage.

[[Page S8751]]

       ``(4) A description of any restrictions on payments for 
     services furnished to a participant or beneficiary by a 
     health care professional that is not a participating 
     professional and the liability of the participant or 
     beneficiary for additional payments for these services.
       ``(5) A description of the service area of each such plan, 
     including the provision of any out-of-area coverage.
       ``(6) A description of the extent to which participants and 
     beneficiaries may select the primary care provider of their 
     choice, including providers both within the network and 
     outside the network of each such plan (if the plan permits 
     out-of-network services).
       ``(7) A description of the procedures for advance 
     directives and organ donation decisions if the plan maintains 
     such procedures.
       ``(8) A description of the requirements and procedures to 
     be used to obtain preauthorization for health services 
     (including telephone numbers and mailing addresses), 
     including referrals for specialty care.
       ``(9) A description of the definition of medical necessity 
     used in making coverage determinations by each such plan.
       ``(10) A summary of the rules and methods for appealing 
     coverage decisions and filing grievances (including telephone 
     numbers and mailing addresses), as well as other available 
     remedies.
       ``(11) A summary description of any provisions for 
     obtaining off-formulary medications if the plan utilizes a 
     defined formulary for providing specific prescription 
     medications.
       ``(12) A summary of the rules for access to emergency room 
     care. Also, any available educational material regarding 
     proper use of emergency services.
       ``(13) A description of whether or not coverage is provided 
     for experimental treatments, investigational treatments, or 
     clinical trials and the circumstances under which access to 
     such treatments or trials is made available.
       ``(14) A description of the specific preventative services 
     covered under the plan if such services are covered.
       ``(15) A statement regarding--
       ``(A) the manner in which a participant or beneficiary may 
     access an obstetrician, gynecologist, or pediatrician in 
     accordance with section 723 or 724; and
       ``(B) the manner in which a participant or beneficiary 
     obtains continuity of care as provided for in section 726.
       ``(16) A statement that the following information, and 
     instructions on obtaining such information (including 
     telephone numbers and, if available, Internet websites), 
     shall be made available upon request:
       ``(A) The names, addresses, telephone numbers, and State 
     licensure status of the plan's participating health care 
     professionals and participating health care facilities, and, 
     if available, the education, training, specialty 
     qualifications or certifications of such professionals.
       ``(B) A summary description of the methods used for 
     compensating participating health care professionals, such as 
     capitation, fee-for-service, salary, or a combination 
     thereof. The requirement of this subparagraph shall not be 
     construed as requiring plans to provide information 
     concerning proprietary payment methodology.
       ``(C) A summary description of the methods used for 
     compensating health care facilities, including per diem, fee-
     for-service, capitation, bundled payments, or a combination 
     thereof. The requirement of this subparagraph shall not be 
     construed as requiring plans to provide information 
     concerning proprietary payment methodology.
       ``(D) A summary description of the procedures used for 
     utilization review.
       ``(E) The list of the specific prescription medications 
     included in the formulary of the plan, if the plan uses a 
     defined formulary.
       ``(F) A description of the specific exclusions from 
     coverage under the plan.
       ``(G) Any available information related to the availability 
     of translation or interpretation services for non-English 
     speakers and people with communication disabilities, 
     including the availability of audio tapes or information in 
     Braille.
       ``(H) Any information that is made public by accrediting 
     organizations in the process of accreditation if the plan is 
     accredited, or any additional quality indicators that the 
     plan makes available.
       ``(c) Manner of Distribution.--The information described in 
     this section shall be distributed in an accessible format 
     that is understandable to an average plan participant or 
     beneficiary.
       ``(d) Rule of Construction.--Nothing in this section may be 
     construed to prohibit a group health plan from distributing 
     any other additional information determined by the plan to be 
     important or necessary in assisting participants and 
     beneficiaries or upon request potential participants and 
     beneficiaries in the selection of a health plan or from 
     providing information under subsection (b)(15) as part of the 
     required information.
       ``(e) Health Care Professional.--In this section, the term 
     `health care professional' means a physician (as defined in 
     section 1861(r) of the Social Security Act) or other health 
     care professional if coverage for the professional's services 
     is provided under the health plan involved for the services 
     of the professional. Such term includes a podiatrist, 
     optometrist, chiropractor, psychologist, dentist, physician 
     assistant, physical or occupational therapist and therapy 
     assistant, speech-language pathologist, audiologist, 
     registered or licensed practical nurse (including nurse 
     practitioner, clinical nurse specialist, certified registered 
     nurse anesthetist, and certified nurse-midwife), licensed 
     certified social worker, registered respiratory therapist, 
     and certified respiratory therapy technician.''.

     SEC. 112. INFORMATION ABOUT PROVIDERS.

       (a) Study.--The Secretary of Health and Human Services 
     shall enter into a contract with the Institute of Medicine 
     for the conduct of a study, and the submission to the 
     Secretary of a report, that includes--
       (1) an analysis of information concerning health care 
     professionals that is currently available to patients, 
     consumers, States, and professional societies, nationally and 
     on a State-by-State basis, including patient preferences with 
     respect to information about such professionals and their 
     competencies;
       (2) an evaluation of the legal and other barriers to the 
     sharing of information concerning health care professionals; 
     and
       (3) recommendations for the disclosure of information on 
     health care professionals, including the competencies and 
     professional qualifications of such practitioners, to better 
     facilitate patient choice, quality improvement, and market 
     competition.
       (b) Report.--Not later than 18 months after the date of 
     enactment of this Act, the Secretary of Health and Human 
     Services shall forward to the appropriate committees of 
     Congress a copy of the report and study conducted under 
     subsection (a).

           Subtitle C--Right to Hold Health Plans Accountable

     SEC. 121. AMENDMENT TO EMPLOYEE RETIREMENT INCOME SECURITY 
                   ACT OF 1974.

       (a) In General.--Section 503 of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1133) is amended to 
     read as follows:

     ``SEC. 503. CLAIMS PROCEDURE, COVERAGE DETERMINATION, 
                   GRIEVANCES AND APPEALS.

       ``(a) Claims Procedure.--In accordance with regulations of 
     the Secretary, every employee benefit plan shall--
       ``(1) provide adequate notice in writing to any participant 
     or beneficiary whose claim for benefits under the plan has 
     been denied, setting forth the specific reasons for such 
     denial, written in a manner calculated to be understood by 
     the participant; and
       ``(2) afford a reasonable opportunity to any participant 
     whose claim for benefits has been denied for a full and fair 
     review by the appropriate named fiduciary of the decision 
     denying the claim.
       ``(b) Coverage Determinations Under Group Health Plans.--
       ``(1) Procedures.--
       ``(A) In general.--A group health plan or health insurance 
     issuer conducting utilization review shall ensure that 
     procedures are in place for--
       ``(i) making determinations regarding whether a participant 
     or beneficiary is eligible to receive a payment or coverage 
     for health services under the plan or coverage involved and 
     any cost-sharing amount that the participant or beneficiary 
     is required to pay with respect to such service;
       ``(ii) notifying a covered participant or beneficiary (or 
     the authorized representative of such participant or 
     beneficiary) and the treating health care professionals 
     involved regarding determinations made under the plan or 
     issuer and any additional payments that the participant or 
     beneficiary may be required to make with respect to such 
     service; and
       ``(iii) responding to requests, either written or oral, for 
     coverage determinations or for internal appeals from a 
     participant or beneficiary (or the authorized representative 
     of such participant or beneficiary) or the treating health 
     care professional with the consent of the participant or 
     beneficiary.
       ``(B) Oral requests.--With respect to an oral request 
     described in subparagraph (A)(iii), a group health plan or 
     health insurance issuer may require that the requesting 
     individual provide written evidence of such request.
       ``(2) Timeline for making determinations.--
       ``(A) Routine determination.--A group health plan or a 
     health insurance issuer shall maintain procedures to ensure 
     that prior authorization determinations concerning the 
     provision of non-emergency items or services are made within 
     30 days from the date on which the request for a 
     determination is submitted, except that such period may be 
     extended where certain circumstances exist that are 
     determined by the Secretary to be beyond control of the plan 
     or issuer.
       ``(B) Expedited determination.--
       ``(i) In general.--A prior authorization determination 
     under this subsection shall be made within 72 hours, in 
     accordance with the medical exigencies of the case, after a 
     request is received by the plan or issuer under clause (ii) 
     or (iii).
       ``(ii) Request by participant or beneficiary.--A plan or 
     issuer shall maintain procedures for expediting a prior 
     authorization determination under this subsection upon the 
     request of a participant or beneficiary if, based on such a 
     request, the plan or issuer determines that the normal time 
     for making such a determination could seriously jeopardize 
     the life or health of the participant or beneficiary.
       ``(iii) Documentation by health care professional.--A plan 
     or issuer shall maintain procedures for expediting a prior 
     authorization determination under this subsection if

[[Page S8752]]

     the request involved indicates that the treating health care 
     professional has reasonably documented, based on the medical 
     exigencies, that a determination under the procedures 
     described in subparagraph (A) could seriously jeopardize the 
     life or health of the participant or beneficiary.
       ``(C) Concurrent determinations.--A plan or issuer shall 
     maintain procedures to certify or deny coverage of an 
     extended stay or additional services.
       ``(D) Retrospective determination.--A plan or issuer shall 
     maintain procedures to ensure that, with respect to the 
     retrospective review of a determination made under paragraph 
     (1), the determination shall be made within 30 working days 
     of the date on which the plan or issuer receives necessary 
     information.
       ``(3) Notice of determinations.--
       ``(A) Routine determination.--With respect to a coverage 
     determination of a plan or issuer under paragraph (2)(A), the 
     plan or issuer shall issue notice of such determination to 
     the participant or beneficiary (or the authorized 
     representative of the participant or beneficiary) and, 
     consistent with the medical exigencies of the case, to the 
     treating health care professional involved not later than 2 
     working days after the date on which the determination is 
     made.
       ``(B) Expedited determination.--With respect to a coverage 
     determination of a plan or issuer under paragraph (2)(B), the 
     plan or issuer shall issue notice of such determination to 
     the participant or beneficiary (or the authorized 
     representative of the participant or beneficiary), and 
     consistent with the medical exigencies of the case, to the 
     treating health care professional involved within the 72 hour 
     period described in paragraph (2)(B).
       ``(C) Concurrent reviews.--With respect to the 
     determination under a plan or issuer under paragraph (2)(C) 
     to certify or deny coverage of an extended stay or additional 
     services, the plan or issuer shall issue notice of such 
     determination to the treating health care professional and to 
     the participant or beneficiary involved (or the authorized 
     representative of the participant or beneficiary) within 1 
     working day of the determination.
       ``(D) Retrospective reviews.--With respect to the 
     retrospective review under a plan or issuer of a 
     determination made under paragraph (2)(D), the plan or issuer 
     shall issue written notice of an approval or disapproval of a 
     determination under this subparagraph to the participant or 
     beneficiary (or the authorized representative of the 
     participant or beneficiary) and health care provider involved 
     within 5 working days of the date on which such determination 
     is made.
       ``(E) Requirements of notice of adverse coverage 
     determinations.--A written notice of an adverse coverage 
     determination under this subsection, or of an expedited 
     adverse coverage determination under paragraph (2)(B), shall 
     be provided to the participant or beneficiary (or the 
     authorized representative of the participant or beneficiary) 
     and treating health care professional (if any) involved and 
     shall include--
       ``(i) the reasons for the determination (including the 
     clinical or scientific-evidence based rationale used in 
     making the determination) written in a manner to be 
     understandable to the average participant or beneficiary;
       ``(ii) the procedures for obtaining additional information 
     concerning the determination; and
       ``(iii) notification of the right to appeal the 
     determination and instructions on how to initiate an appeal 
     in accordance with subsection (d).
       ``(c) Grievances.--A group health plan or a health 
     insurance issuer shall have written procedures for addressing 
     grievances between the plan or issuer offering health 
     insurance coverage in connection with a group health plan and 
     a participant or beneficiary. Determinations under such 
     procedures shall be non-appealable.
       ``(d) Internal Appeal of Coverage Determinations.--
       ``(1) Right to appeal.--
       ``(A) In general.--A participant or beneficiary (or the 
     authorized representative of the participant or beneficiary) 
     or the treating health care professional with the consent of 
     the participant or beneficiary (or the authorized 
     representative of the participant or beneficiary), may appeal 
     any adverse coverage determination under subsection (b) under 
     the procedures described in this subsection.
       ``(B) Time for appeal.--A plan or issuer shall ensure that 
     a participant or beneficiary has a period of not less than 
     180 days beginning on the date of an adverse coverage 
     determination under subsection (b) in which to appeal such 
     determination under this subsection.
       ``(C) Failure to act.--The failure of a plan or issuer to 
     issue a determination under subsection (b) within the 
     applicable timeline established for such a determination 
     under such subsection shall be treated as an adverse coverage 
     determination for purposes of proceeding to internal review 
     under this subsection.
       ``(2) Records.--A group health plan and a health insurance 
     issuer shall maintain written records, for at least 6 years, 
     with respect to any appeal under this subsection for purposes 
     of internal quality assurance and improvement. Nothing in the 
     preceding sentence shall be construed as preventing a plan 
     and issuer from entering into an agreement under which the 
     issuer agrees to assume responsibility for compliance with 
     the requirements of this section and the plan is released 
     from liability for such compliance.
       ``(3) Routine determinations.--A group health plan or a 
     health insurance issuer shall complete the consideration of 
     an appeal of an adverse routine determination under this 
     subsection not later than 30 working days after the date on 
     which a request for such appeal is received.
       ``(4) Expedited determination.--
       ``(A) In general.--An expedited determination with respect 
     to an appeal under this subsection shall be made in 
     accordance with the medical exigencies of the case, but in no 
     case more than 72 hours after the request for such appeal is 
     received by the plan or issuer under subparagraph (B) or (C).
       ``(B) Request by participant or beneficiary.--A plan or 
     issuer shall maintain procedures for expediting a prior 
     authorization determination under this subsection upon the 
     request of a participant or beneficiary if, based on such a 
     request, the plan or issuer determines that the normal time 
     for making such a determination could seriously jeopardize 
     the life or health of the participant or beneficiary.
       ``(C) Documentation by health care professional.--A plan or 
     issuer shall maintain procedures for expediting a prior 
     authorization determination under this subsection if the 
     request involved indicates that the treating health care 
     professional has reasonably documented, based on the medical 
     exigencies of the case that a determination under the 
     procedures described in paragraph (2) could seriously 
     jeopardize the life or health of the participant or 
     beneficiary.
       ``(5) Conduct of review.--A review of an adverse coverage 
     determination under this subsection shall be conducted by an 
     individual with appropriate expertise who was not directly 
     involved in the initial determination.
       ``(6) Lack of medical necessity.--A review of an appeal 
     under this subsection relating to a determination to deny 
     coverage based on a lack of medical necessity and 
     appropriateness, or based on an experimental or 
     investigational treatment, shall be made only by a physician 
     with appropriate expertise, including age-appropriate 
     expertise, who was not involved in the initial determination.
       ``(7) Notice.--
       ``(A) In general.--Written notice of a determination made 
     under an internal review process shall be issued to the 
     participant or beneficiary (or the authorized representative 
     of the participant or beneficiary) and the treating health 
     care professional not later than 2 working days after the 
     completion of the review (or within the 72-hour period 
     referred to in paragraph (4) if applicable).
       ``(B) Adverse coverage determinations.--With respect to an 
     adverse coverage determination made under this subsection, 
     the notice described in subparagraph (A) shall include--
       ``(i) the reasons for the determination (including the 
     clinical or scientific-evidence based rationale used in 
     making the determination) written in a manner to be 
     understandable to the average participant or beneficiary;
       ``(ii) the procedures for obtaining additional information 
     concerning the determination; and
       ``(iii) notification of the right to an independent 
     external review under subsection (e) and instructions on how 
     to initiate such a review.
       ``(e) Independent External Review.--
       ``(1) Access to review.--
       ``(A) In general.--A group health plan or a health 
     insurance issuer offering health insurance coverage in 
     connection with a group health plan shall have written 
     procedures to permit a participant or beneficiary (or the 
     authorized representative of the participant or beneficiary) 
     access to an independent external review with respect to an 
     adverse coverage determination concerning a particular item 
     or service (including a circumstance treated as an adverse 
     coverage determination under subparagraph (B)) where--
       ``(i) the particular item or service involved--

       ``(I)(aa) would be a covered benefit, when medically 
     necessary and appropriate under the terms and conditions of 
     the plan, and the item or service has been determined not to 
     be medically necessary and appropriate under the internal 
     appeals process required under subsection (d) or there has 
     been a failure to issue a coverage determination as described 
     in subparagraph (B); and
       ``(bb)(AA) the amount of such item or service involved 
     exceeds a significant financial threshold; or
       ``(BB) there is a significant risk of placing the life or 
     health of the participant or beneficiary in jeopardy; or
       ``(II) would be a covered benefit, when not considered 
     experimental or investigational under the terms and 
     conditions of the plan, and the item or service has been 
     determined to be experimental or investigational under the 
     internal appeals process required under subsection (d) or 
     there has been a failure to issue a coverage determination as 
     described in subparagraph (B); and

       ``(ii) the participant or beneficiary has completed the 
     internal appeals process under subsection (d) with respect to 
     such determination.
       ``(B) Failure to act.--The failure of a plan or issuer to 
     issue a coverage determination under subsection (d)(6) within 
     the applicable timeline established for such a determination 
     under such subsection shall be treated as an adverse coverage 
     determination for

[[Page S8753]]

     purposes of proceeding to independent external review under 
     this subsection.
       ``(2) Initiation of the independent external review 
     process.--
       ``(A) Filing of request.--A participant or beneficiary (or 
     the authorized representative of the participant or 
     beneficiary) who desires to have an independent external 
     review conducted under this subsection shall file a written 
     request for such a review with the plan or issuer involved 
     not later than 30 working days after the receipt of a final 
     denial of a claim under subsection (d). Any such request 
     shall include the consent of the participant or beneficiary 
     (or the authorized representative of the participant or 
     beneficiary) for the release of medical information and 
     records to independent external reviewers regarding the 
     participant or beneficiary.
       ``(B) Timeframe for selection of appeals entity.--Not later 
     than 5 working days after the receipt of a request under 
     subparagraph (A), or earlier in accordance with the medical 
     exigencies of the case, the plan or issuer involved shall--
       ``(i) select an external appeals entity under paragraph 
     (3)(A) that shall be responsible for designating an 
     independent external reviewer under paragraph (3)(B); and
       ``(ii) provide notice of such selection to the participant 
     or beneficiary (which shall include the name and address of 
     the entity).
       ``(C) Provision of information.--Not later than 5 working 
     days after the plan or issuer provides the notice required 
     under subparagraph (B)(ii), or earlier in accordance with the 
     medical exigencies of the case, the plan, issuer, 
     participant, beneficiary or physician (of the participant or 
     beneficiary) involved shall forward necessary information 
     (including, only in the case of a plan or issuer, medical 
     records, any relevant review criteria, the clinical rationale 
     consistent with the terms and conditions of the contract 
     between the plan or issuer and the participant or beneficiary 
     for the coverage denial, and evidence of the coverage of the 
     participant or beneficiary) to the qualified external appeals 
     entity designated under paragraph (3)(A).
       ``(D) Follow-up written notification.--The plan or issuer 
     involved shall send a follow-up written notification, in a 
     timely manner, to the participant or beneficiary (or the 
     authorized representative of the participant or beneficiary) 
     and the plan administrator, indicating that an independent 
     external review has been initiated.
       ``(3) Conduct of independent external review.--
       ``(A) Designation of external appeals entity by plan or 
     issuer.--
       ``(i) In general.--A plan or issuer that receives a request 
     for an independent external review under paragraph (2)(A) 
     shall designate a qualified entity described in clause (ii), 
     in a manner designed to ensure that the entity so designated 
     will make a decision in an unbiased manner, to serve as the 
     external appeals entity.
       ``(ii) Qualified entities.--A qualified entity shall be--

       ``(I) an independent external review entity licensed or 
     credentialed by a State;
       ``(II) a State agency established for the purpose of 
     conducting independent external reviews;
       ``(III) any entity under contract with the Federal 
     Government to provide independent external review services;
       ``(IV) any entity accredited as an independent external 
     review entity by an accrediting body recognized by the 
     Secretary for such purpose; or
       ``(V) any other entity meeting criteria established by the 
     Secretary for purposes of this subparagraph.

       ``(B) Designation of independent external reviewer by 
     external appeals entity.--The external appeals entity 
     designated under subparagraph (A) shall, not later than 30 
     days after the date on which such entity is designated under 
     subparagraph (A), or earlier in accordance with the medical 
     exigencies of the case, designate one or more individuals to 
     serve as independent external reviewers with respect to a 
     request received under paragraph (2)(A). Such reviewers shall 
     be independent medical experts who shall--
       ``(i) be appropriately credentialed or licensed in any 
     State to deliver health care services;
       ``(ii) not have any material, professional, familial, or 
     financial affiliation with the case under review, the 
     participant or beneficiary involved, the treating health care 
     professional, the institution where the treatment would take 
     place, or the manufacturer of any drug, device, procedure, or 
     other therapy proposed for the participant or beneficiary 
     whose treatment is under review;
       ``(iii) have expertise (including age-appropriate 
     expertise) in the diagnosis or treatment under review and be 
     a physician of the same specialty, when reasonably available, 
     as the physician treating the participant or beneficiary or 
     recommending or prescribing the treatment in question;
       ``(iv) receive only reasonable and customary compensation 
     from the group health plan or health insurance issuer in 
     connection with the independent external review that is not 
     contingent on the decision rendered by the reviewer; and
       ``(v) not be held liable for decisions regarding medical 
     determinations (but may be held liable for actions that are 
     arbitrary and capricious).
       ``(4) Standard of review.--
       ``(A) In general.--An independent external reviewer shall--
       ``(i) make an independent determination based on the valid, 
     relevant, scientific and clinical evidence to determine the 
     medical necessity, appropriateness, experimental or 
     investigational nature of the proposed treatment; and
       ``(ii) take into consideration appropriate and available 
     information, including any evidence-based decision making or 
     clinical practice guidelines used by the group health plan or 
     health insurance issuer; timely evidence or information 
     submitted by the plan, issuer, patient or patient's 
     physician; the patient's medical record; expert consensus 
     including both generally accepted medical practice and 
     recognized best practice; medical literature as defined in 
     section 556(5) of the Federal Food, Drug, and Cosmetic Act; 
     the following standard reference compendia: The American 
     Hospital Formulary Service-Drug Information, the American 
     Dental Association Accepted Dental Therapeutics, and the 
     United States Pharmacopoeia-Drug Information; and findings, 
     studies, or research conducted by or under the auspices of 
     Federal Government agencies and nationally recognized Federal 
     research institutes including the Agency for Healthcare 
     Research and Quality, National Institutes of Health, National 
     Academy of Sciences, Health Care Financing Administration, 
     and any national board recognized by the National Institutes 
     of Health for the purposes of evaluating the medical value of 
     health services.
       ``(B) Notice.--The plan or issuer involved shall ensure 
     that the participant or beneficiary receives notice, within 
     30 days after the determination of the independent medical 
     expert, regarding the actions of the plan or issuer with 
     respect to the determination of such expert under the 
     independent external review.
       ``(5) Timeframe for review.--
       ``(A) In general.--The independent external reviewer shall 
     complete a review of an adverse coverage determination in 
     accordance with the medical exigencies of the case.
       ``(B) Expedited review.--Notwithstanding subparagraph (A), 
     a review described in such subparagraph shall be completed 
     not later than 72 hours after the later of--
       ``(i) the date on which such reviewer is designated; or
       ``(ii) the date on which all information necessary to 
     completing such review is received;
     if the completion of such review in a period of time in 
     excess of 72 hours would seriously jeopardize the life or 
     health of the participant or beneficiary.
       ``(C) Limitation.--Notwithstanding subparagraph (A), and 
     except as provided in subparagraph (B), a review described in 
     subparagraph (A) shall be completed not later than 30 working 
     days after the later of--
       ``(i) the date on which such reviewer is designated; or
       ``(ii) the date on which all information necessary to 
     completing such review is received.
       ``(6) Binding determination and access to care.--
       ``(A) In general.--The determination of an independent 
     external reviewer under this subsection shall be binding upon 
     the plan or issuer if the provisions of this subsection or 
     the procedures implemented under such provisions were 
     complied with by the independent external reviewer.
       ``(B) Timetable for commencement of care.--Where an 
     independent external reviewer determines that the participant 
     or beneficiary is entitled to coverage of the items or 
     services that were the subject of the review, the reviewer 
     shall establish a timeframe, in accordance with the medical 
     exigencies of the case, during which the plan or issuer shall 
     comply with the decision of the reviewer with respect to the 
     coverage of such items or services under the terms and 
     conditions of the plan.
       ``(C) Failure to comply.--If a plan or issuer fails to 
     comply with the timeframe established under subparagraph (B) 
     with respect to a participant or beneficiary, where such 
     failure to comply is caused by the plan or issuer, the 
     participant or beneficiary may obtain the items or services 
     involved (in a manner consistent with the determination of 
     the independent external reviewer) from any provider 
     regardless of whether such provider is a participating 
     provider under the plan or coverage.
       ``(D) Reimbursement.--
       ``(i) In general.--Where a participant or beneficiary 
     obtains items or services in accordance with subparagraph 
     (C), the plan or issuer involved shall provide for 
     reimbursement of the costs of such items of services. Such 
     reimbursement shall be made to the treating provider or to 
     the participant or beneficiary (in the case of a participant 
     or beneficiary who pays for the costs of such items or 
     services).
       ``(ii) Amount.--The plan or issuer shall fully reimburse a 
     provider, participant or beneficiary under clause (i) for the 
     total costs of the items or services provided (regardless of 
     any plan limitations that may apply to the coverage of such 
     items of services) so long as--

       ``(I) the items or services would have been covered under 
     the terms of the plan or coverage if provided by the plan or 
     issuer; and
       ``(II) the items or services were provided in a manner 
     consistent with the determination of the independent external 
     reviewer.

       ``(E) Failure to reimburse.--Where a plan or issuer fails 
     to provide reimbursement to a provider, participant or 
     beneficiary in accordance with this paragraph, the provider, 
     participant or beneficiary may commence a

[[Page S8754]]

     civil action (or utilize other remedies available under law) 
     to recover only the amount of any such reimbursement that is 
     unpaid and any necessary legal costs or expenses (including 
     attorneys' fees) incurred in recovering such reimbursement.
       ``(7) Study.--Not later than 2 years after the date of 
     enactment of this section, the General Accounting Office 
     shall conduct a study of a statistically appropriate sample 
     of completed independent external reviews. Such study shall 
     include an assessment of the process involved during an 
     independent external review and the basis of decisionmaking 
     by the independent external reviewer. The results of such 
     study shall be submitted to the appropriate committees of 
     Congress.
       ``(8) Effect on certain provisions.--Nothing in this 
     section shall be construed as affecting or modifying section 
     514 of this Act with respect to a group health plan.
       ``(f) Rule of Construction.--Nothing in this section shall 
     be construed to prohibit a plan administrator or plan 
     fiduciary or health plan medical director from requesting an 
     independent external review by an independent external 
     reviewer without first completing the internal review 
     process.
       ``(g) Definitions.--In this section:
       ``(1) Adverse coverage determination.--The term `adverse 
     coverage determination' means a coverage determination under 
     the plan which results in a denial of coverage or 
     reimbursement.
       ``(2) Coverage determination.--The term `coverage 
     determination' means with respect to items and services for 
     which coverage may be provided under a health plan, a 
     determination of whether or not such items and services are 
     covered or reimbursable under the coverage and terms of the 
     contract.
       ``(3) Grievance.--The term `grievance' means any complaint 
     made by a participant or beneficiary that does not involve a 
     coverage determination.
       ``(4) Group health plan.--The term `group health plan' 
     shall have the meaning given such term in section 733(a). In 
     applying this paragraph, excepted benefits described in 
     section 733(c) shall not be treated as benefits consisting of 
     medical care.
       ``(5) Health insurance coverage.--The term `health 
     insurance coverage' has the meaning given such term in 
     section 733(b)(1). In applying this paragraph, excepted 
     benefits described in section 733(c) shall not be treated as 
     benefits consisting of medical care.
       ``(6) Health insurance issuer.--The term `health insurance 
     issuer' has the meaning given such term in section 733(b)(2).
       ``(7) Prior authorization determination.--The term `prior 
     authorization determination' means a coverage determination 
     prior to the provision of the items and services as a 
     condition of coverage of the items and services under the 
     coverage.
       ``(8) Treating health care professional.--The term 
     `treating health care professional' with respect to a group 
     health plan, health insurance issuer or provider sponsored 
     organization means a physician (medical doctor or doctor of 
     osteopathy) or other health care practitioner who is acting 
     within the scope of his or her State licensure or 
     certification for the delivery of health care services and 
     who is primarily responsible for delivering those services to 
     the participant or beneficiary.
       ``(9) Utilization review.--The term `utilization review' 
     with respect to a group health plan or health insurance 
     coverage means a set of formal techniques designed to monitor 
     the use of, or evaluate the clinical necessity, 
     appropriateness, efficacy, or efficiency of, health care 
     services, procedures, or settings. Techniques may include 
     ambulatory review, prospective review, second opinion, 
     certification, concurrent review, case management, discharge 
     planning or retrospective review.''.
       (b) Enforcement.--Section 502(c) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1132(c)) is amended by 
     adding at the end the following:
       ``(8) The Secretary may assess a civil penalty against any 
     plan of up to $10,000 for the plan's failure or refusal to 
     comply with any timeline applicable under section 503(e) or 
     any determination under such section, except that in any case 
     in which treatment was not commenced by the plan in 
     accordance with the determination of an independent external 
     reviewer, the Secretary shall assess a civil penalty of 
     $10,000 against the plan and the plan shall pay such penalty 
     to the participant or beneficiary involved.''.
       (c) Conforming Amendment.--The table of contents in section 
     1 of the Employee Retirement Income Security Act of 1974 is 
     amended by striking the item relating to section 503 and 
     inserting the following new item:

``Sec. 503. Claims procedures, coverage determination, grievances and 
              appeals.''.
       (d) Effective Date.--The amendments made by this section 
     shall apply with respect to plan years beginning on or after 
     1 year after the date of enactment of this Act. The Secretary 
     shall issue all regulations necessary to carry out the 
     amendments made by this section before the effective date 
     thereof.

               TITLE II--WOMEN'S HEALTH AND CANCER RIGHTS

     SEC. 201. WOMEN'S HEALTH AND CANCER RIGHTS.

       (a) Short Title.--This section may be cited as the 
     ``Women's Health and Cancer Rights Act of 1999''.
       (b) Findings.--Congress finds that--
       (1) the offering and operation of health plans affect 
     commerce among the States;
       (2) health care providers located in a State serve patients 
     who reside in the State and patients who reside in other 
     States; and
       (3) 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 1 State as well as health 
     plans operating among the several States.
       (c) Amendments to ERISA.--
       (1) In general.--Subpart B of part 7 of subtitle B of title 
     I of the Employee Retirement Income Security Act of 1974, as 
     amended by section 111(a), is further amended by adding at 
     the end the following:

     ``SEC. 715. REQUIRED COVERAGE FOR MINIMUM HOSPITAL STAY FOR 
                   MASTECTOMIES AND LYMPH NODE DISSECTIONS FOR THE 
                   TREATMENT OF BREAST CANCER AND COVERAGE FOR 
                   SECONDARY CONSULTATIONS.

       ``(a) Inpatient Care.--
       ``(1) In general.--A group health plan, and a health 
     insurance issuer providing health insurance coverage in 
     connection with a group health plan, that provides medical 
     and surgical benefits shall ensure that inpatient coverage 
     with respect to the treatment of breast cancer is provided 
     for a period of time as is determined by the attending 
     physician, in consultation with the patient, to be medically 
     necessary and appropriate following--
       ``(A) a mastectomy;
       ``(B) a lumpectomy; or
       ``(C) a lymph node dissection for the treatment of breast 
     cancer.
       ``(2) Exception.--Nothing in this section shall be 
     construed as requiring the provision of inpatient coverage if 
     the attending physician and patient determine that a shorter 
     period of hospital stay is medically appropriate.
       ``(b) Prohibition on Certain Modifications.--In 
     implementing the requirements of this section, a group health 
     plan, and a health insurance issuer providing health 
     insurance coverage in connection with a group health plan, 
     may not modify the terms and conditions of coverage based on 
     the determination by a participant or beneficiary to request 
     less than the minimum coverage required under subsection (a).
       ``(c) Notice.--A group health plan, and a health insurance 
     issuer providing health insurance coverage in connection with 
     a group health plan shall provide notice to each participant 
     and beneficiary under such plan regarding the coverage 
     required by this section in accordance with regulations 
     promulgated by the Secretary. Such notice shall be in writing 
     and prominently positioned in any literature or 
     correspondence made available or distributed by the plan or 
     issuer and shall be transmitted--
       ``(1) in the next mailing made by the plan or issuer to the 
     participant or beneficiary;
       ``(2) as part of any yearly informational packet sent to 
     the participant or beneficiary; or
       ``(3) not later than January 1, 2000;
     whichever is earlier.
       ``(d) Secondary Consultations.--
       ``(1) In general.--A group health plan, and a health 
     insurance issuer providing health insurance coverage in 
     connection with a group health plan, that provides coverage 
     with respect to medical and surgical services provided in 
     relation to the diagnosis and treatment of cancer shall 
     ensure that full coverage is provided for secondary 
     consultations by specialists in the appropriate medical 
     fields (including pathology, radiology, and oncology) to 
     confirm or refute such diagnosis. Such plan or issuer shall 
     ensure that full coverage is provided for such secondary 
     consultation whether such consultation is based on a positive 
     or negative initial diagnosis. In any case in which the 
     attending physician certifies in writing that services 
     necessary for such a secondary consultation are not 
     sufficiently available from specialists operating under the 
     plan with respect to whose services coverage is otherwise 
     provided under such plan or by such issuer, such plan or 
     issuer shall ensure that coverage is provided with respect to 
     the services necessary for the secondary consultation with 
     any other specialist selected by the attending physician for 
     such purpose at no additional cost to the individual beyond 
     that which the individual would have paid if the specialist 
     was participating in the network of the plan.
       ``(2) Exception.--Nothing in paragraph (1) shall be 
     construed as requiring the provision of secondary 
     consultations where the patient determines not to seek such a 
     consultation.
       ``(e) Prohibition on Penalties or Incentives.--A group 
     health plan, and a health insurance issuer providing health 
     insurance coverage in connection with a group health plan, 
     may not--
       ``(1) penalize or otherwise reduce or limit the 
     reimbursement of a provider or specialist because the 
     provider or specialist provided care to a participant or 
     beneficiary in accordance with this section;
       ``(2) provide financial or other incentives to a physician 
     or specialist to induce the physician or specialist to keep 
     the length of inpatient stays of patients following a 
     mastectomy, lumpectomy, or a lymph node dissection for the 
     treatment of breast cancer below certain limits or to limit 
     referrals for secondary consultations; or
       ``(3) provide financial or other incentives to a physician 
     or specialist to induce the physician or specialist to 
     refrain from referring a participant or beneficiary for a 
     secondary consultation that would otherwise be

[[Page S8755]]

     covered by the plan or coverage involved under subsection 
     (d).''.
       (2) Clerical amendment.--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 714 
     the following new item:

``Sec. 715. Required coverage for minimum hospital stay for 
              mastectomies and lymph node dissections for the treatment 
              of breast cancer and coverage for secondary 
              consultations.''.
       (d) Amendments to PHSA Relating to the Group Market.--
     Subpart 2 of part A of title XXVII of the Public Health 
     Service Act (42 U.S.C. 300gg-4 et seq.) is amended by adding 
     at the end the following new section:

     ``SEC. 2707. REQUIRED COVERAGE FOR MINIMUM HOSPITAL STAY FOR 
                   MASTECTOMIES AND LYMPH NODE DISSECTIONS FOR THE 
                   TREATMENT OF BREAST CANCER AND COVERAGE FOR 
                   SECONDARY CONSULTATIONS.

       ``(a) Inpatient Care.--
       ``(1) In general.--A group health plan, and a health 
     insurance issuer providing health insurance coverage in 
     connection with a group health plan, that provides medical 
     and surgical benefits shall ensure that inpatient coverage 
     with respect to the treatment of breast cancer is provided 
     for a period of time as is determined by the attending 
     physician, in consultation with the patient, to be medically 
     necessary and appropriate following--
       ``(A) a mastectomy;
       ``(B) a lumpectomy; or
       ``(C) a lymph node dissection for the treatment of breast 
     cancer.
       ``(2) Exception.--Nothing in this section shall be 
     construed as requiring the provision of inpatient coverage if 
     the attending physician and patient determine that a shorter 
     period of hospital stay is medically appropriate.
       ``(b) Prohibition on Certain Modifications.--In 
     implementing the requirements of this section, a group health 
     plan, and a health insurance issuer providing health 
     insurance coverage in connection with a group health plan, 
     may not modify the terms and conditions of coverage based on 
     the determination by a participant or beneficiary to request 
     less than the minimum coverage required under subsection (a).
       ``(c) Notice.--A group health plan, and a health insurance 
     issuer providing health insurance coverage in connection with 
     a group health plan shall provide notice to each participant 
     and beneficiary under such plan regarding the coverage 
     required by this section in accordance with regulations 
     promulgated by the Secretary. Such notice shall be in writing 
     and prominently positioned in any literature or 
     correspondence made available or distributed by the plan or 
     issuer and shall be transmitted--
       ``(1) in the next mailing made by the plan or issuer to the 
     participant or beneficiary;
       ``(2) as part of any yearly informational packet sent to 
     the participant or beneficiary; or
       ``(3) not later than January 1, 2000;
     whichever is earlier.
       ``(d) Secondary Consultations.--
       ``(1) In general.--A group health plan, and a health 
     insurance issuer providing health insurance coverage in 
     connection with a group health plan that provides coverage 
     with respect to medical and surgical services provided in 
     relation to the diagnosis and treatment of cancer shall 
     ensure that full coverage is provided for secondary 
     consultations by specialists in the appropriate medical 
     fields (including pathology, radiology, and oncology) to 
     confirm or refute such diagnosis. Such plan or issuer shall 
     ensure that full coverage is provided for such secondary 
     consultation whether such consultation is based on a positive 
     or negative initial diagnosis. In any case in which the 
     attending physician certifies in writing that services 
     necessary for such a secondary consultation are not 
     sufficiently available from specialists operating under the 
     plan with respect to whose services coverage is otherwise 
     provided under such plan or by such issuer, such plan or 
     issuer shall ensure that coverage is provided with respect to 
     the services necessary for the secondary consultation with 
     any other specialist selected by the attending physician for 
     such purpose at no additional cost to the individual beyond 
     that which the individual would have paid if the specialist 
     was participating in the network of the plan.
       ``(2) Exception.--Nothing in paragraph (1) shall be 
     construed as requiring the provision of secondary 
     consultations where the patient determines not to seek such a 
     consultation.
       ``(e) Prohibition on Penalties or Incentives.--A group 
     health plan, and a health insurance issuer providing health 
     insurance coverage in connection with a group health plan, 
     may not--
       ``(1) penalize or otherwise reduce or limit the 
     reimbursement of a provider or specialist because the 
     provider or specialist provided care to a participant or 
     beneficiary in accordance with this section;
       ``(2) provide financial or other incentives to a physician 
     or specialist to induce the physician or specialist to keep 
     the length of inpatient stays of patients following a 
     mastectomy, lumpectomy, or a lymph node dissection for the 
     treatment of breast cancer below certain limits or to limit 
     referrals for secondary consultations; or
       ``(3) provide financial or other incentives to a physician 
     or specialist to induce the physician or specialist to 
     refrain from referring a participant or beneficiary for a 
     secondary consultation that would otherwise be covered by the 
     plan or coverage involved under subsection (d).''.
       (e) Amendments to PHSA Relating to the Individual Market.--
     The first subpart 3 of part B of title XXVII of the Public 
     Health Service Act (42 U.S.C. 300gg-51 et seq.) (relating to 
     other requirements) (42 U.S.C. 300gg-51 et seq.) is amended--
       (1) by redesignating such subpart as subpart 2; and
       (2) by adding at the end the following:

     ``SEC. 2753. REQUIRED COVERAGE FOR MINIMUM HOSPITAL STAY FOR 
                   MASTECTOMIES AND LYMPH NODE DISSECTIONS FOR THE 
                   TREATMENT OF BREAST CANCER AND SECONDARY 
                   CONSULTATIONS.

       ``The provisions of section 2707 shall apply to health 
     insurance coverage offered by a health insurance issuer in 
     the individual market in the same manner as they apply to 
     health insurance coverage offered by a health insurance 
     issuer in connection with a group health plan in the small or 
     large group market.''.
       (f) Amendments to the IRC.--
       (1) In general.--Subchapter B of chapter 100 of the 
     Internal Revenue Code of 1986, as amended by section 111(b), 
     is further amended by inserting after section 9813 the 
     following:

     ``SEC. 9814. REQUIRED COVERAGE FOR MINIMUM HOSPITAL STAY FOR 
                   MASTECTOMIES AND LYMPH NODE DISSECTIONS FOR THE 
                   TREATMENT OF BREAST CANCER AND COVERAGE FOR 
                   SECONDARY CONSULTATIONS.

       ``(a) Inpatient Care.--
       ``(1) In general.--A group health plan that provides 
     medical and surgical benefits shall ensure that inpatient 
     coverage with respect to the treatment of breast cancer is 
     provided for a period of time as is determined by the 
     attending physician, in consultation with the patient, to be 
     medically necessary and appropriate following--
       ``(A) a mastectomy;
       ``(B) a lumpectomy; or
       ``(C) a lymph node dissection for the treatment of breast 
     cancer.
       ``(2) Exception.--Nothing in this section shall be 
     construed as requiring the provision of inpatient coverage if 
     the attending physician and patient determine that a shorter 
     period of hospital stay is medically appropriate.
       ``(b) Prohibition on Certain Modifications.--In 
     implementing the requirements of this section, a group health 
     plan may not modify the terms and conditions of coverage 
     based on the determination by a participant or beneficiary to 
     request less than the minimum coverage required under 
     subsection (a).
       ``(c) Notice.--A group health plan shall provide notice to 
     each participant and beneficiary under such plan regarding 
     the coverage required by this section in accordance with 
     regulations promulgated by the Secretary. Such notice shall 
     be in writing and prominently positioned in any literature or 
     correspondence made available or distributed by the plan and 
     shall be transmitted--
       ``(1) in the next mailing made by the plan to the 
     participant or beneficiary;
       ``(2) as part of any yearly informational packet sent to 
     the participant or beneficiary; or
       ``(3) not later than January 1, 2000;
     whichever is earlier.
       ``(d) Secondary Consultations.--
       ``(1) In general.--A group health plan that provides 
     coverage with respect to medical and surgical services 
     provided in relation to the diagnosis and treatment of cancer 
     shall ensure that full coverage is provided for secondary 
     consultations by specialists in the appropriate medical 
     fields (including pathology, radiology, and oncology) to 
     confirm or refute such diagnosis. Such plan or issuer shall 
     ensure that full coverage is provided for such secondary 
     consultation whether such consultation is based on a positive 
     or negative initial diagnosis. In any case in which the 
     attending physician certifies in writing that services 
     necessary for such a secondary consultation are not 
     sufficiently available from specialists operating under the 
     plan with respect to whose services coverage is otherwise 
     provided under such plan or by such issuer, such plan or 
     issuer shall ensure that coverage is provided with respect to 
     the services necessary for the secondary consultation with 
     any other specialist selected by the attending physician for 
     such purpose at no additional cost to the individual beyond 
     that which the individual would have paid if the specialist 
     was participating in the network of the plan.
       ``(2) Exception.--Nothing in paragraph (1) shall be 
     construed as requiring the provision of secondary 
     consultations where the patient determines not to seek such a 
     consultation.
       ``(e) Prohibition on Penalties.--A group health plan may 
     not--
       ``(1) penalize or otherwise reduce or limit the 
     reimbursement of a provider or specialist because the 
     provider or specialist provided care to a participant or 
     beneficiary in accordance with this section;
       ``(2) provide financial or other incentives to a physician 
     or specialist to induce the physician or specialist to keep 
     the length of inpatient stays of patients following a 
     mastectomy, lumpectomy, or a lymph node dissection for the 
     treatment of breast cancer below certain limits or to limit 
     referrals for secondary consultations; or
       ``(3) provide financial or other incentives to a physician 
     or specialist to induce the

[[Page S8756]]

     physician or specialist to refrain from referring a 
     participant or beneficiary for a secondary consultation that 
     would otherwise be covered by the plan involved under 
     subsection (d).''.
       (2) Clerical amendment.--The table of contents for chapter 
     100 of such Code is amended by inserting after the item 
     relating to section 9813 the following new item:

``Sec. 9814. Required coverage for minimum hospital stay for 
              mastectomies and lymph node dissections for the treatment 
              of breast cancer and coverage for secondary 
              consultations.''.

              TITLE III--GENETIC INFORMATION AND SERVICES

     SEC. 301. SHORT TITLE.

       This title may be cited as the ``Genetic Information 
     Nondiscrimination in Health Insurance Act of 1999''.

     SEC. 302. AMENDMENTS TO EMPLOYEE RETIREMENT INCOME SECURITY 
                   ACT OF 1974.

       (a) Prohibition of Health Discrimination on the Basis of 
     Genetic Information or Genetic Services.--
       (1) No enrollment restriction for genetic services.--
     Section 702(a)(1)(F) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1182(a)(1)(F)) is amended by 
     inserting before the period the following: ``(including 
     information about a request for or receipt of genetic 
     services)''.
       (2) No discrimination in group premiums based on predictive 
     genetic information.--Subpart B of part 7 of subtitle B of 
     title I of the Employee Retirement Income Security Act of 
     1974, as amended by sections 111(a) and 201, is further 
     amended by adding at the end the following:

     ``SEC. 716. PROHIBITING PREMIUM DISCRIMINATION AGAINST GROUPS 
                   ON THE BASIS OF PREDICTIVE GENETIC INFORMATION.

       ``A group health plan, or a health insurance issuer 
     offering group health insurance coverage in connection with a 
     group health plan, shall not adjust premium or contribution 
     amounts for a group on the basis of predictive genetic 
     information concerning any individual (including a dependent) 
     or family member of the individual (including information 
     about a request for or receipt of genetic services).''.
       (3) Conforming amendments.--
       (A) In general.--Section 702(b) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1182(b)) is amended by 
     adding at the end the following:
       ``(3) Reference to related provision.--For a provision 
     prohibiting the adjustment of premium or contribution amounts 
     for a group under a group health plan on the basis of 
     predictive genetic information (including information about a 
     request for or receipt of genetic services), see section 
     716.''.
       (B) Table of contents.--The table of contents in section 1 
     of the Employee Retirement Income Security Act of 1974, as 
     amended by sections 111(a) and 201, is further amended by 
     inserting after the item relating to section 715 the 
     following new item:

``Sec. 716. Prohibiting premium discrimination against groups on the 
              basis of predictive genetic information.''.
       (b) Limitation on Collection of Predictive Genetic 
     Information.--Section 702 of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1182) is amended by adding at 
     the end the following:
       ``(c) Collection of Predictive Genetic Information.--
       ``(1) Limitation on requesting or requiring predictive 
     genetic information.--Except as provided in paragraph (2), a 
     group health plan, or a health insurance issuer offering 
     health insurance coverage in connection with a group health 
     plan, shall not request or require predictive genetic 
     information concerning any individual (including a dependent) 
     or family member of the individual (including information 
     about a request for or receipt of genetic services).
       ``(2) Information needed for diagnosis, treatment, or 
     payment.--
       ``(A) In general.--Notwithstanding paragraph (1), a group 
     health plan, or a health insurance issuer offering health 
     insurance coverage in connection with a group health plan, 
     that provides health care items and services to an individual 
     or dependent may request (but may not require) that such 
     individual or dependent disclose, or authorize the collection 
     or disclosure of, predictive genetic information for purposes 
     of diagnosis, treatment, or payment relating to the provision 
     of health care items and services to such individual or 
     dependent.
       ``(B) Notice of confidentiality practices and description 
     of safeguards.--As a part of a request under subparagraph 
     (A), the group health plan, or a health insurance issuer 
     offering health insurance coverage in connection with a group 
     health plan, shall provide to the individual or dependent a 
     description of the procedures in place to safeguard the 
     confidentiality, as described in subsection (d), of such 
     predictive genetic information.
       ``(d) Confidentiality with Respect to Predictive Genetic 
     Information.--
       ``(1) Notice of confidentiality practices.--
       ``(A) Preparation of written notice.--A group health plan, 
     or a health insurance issuer offering health insurance 
     coverage in connection with a group health plan, shall post 
     or provide, in writing and in a clear and conspicuous manner, 
     notice of the plan or issuer's confidentiality practices, 
     that shall include--
       ``(i) a description of an individual's rights with respect 
     to predictive genetic information;
       ``(ii) the procedures established by the plan or issuer for 
     the exercise of the individual's rights; and
       ``(iii) the right to obtain a copy of the notice of the 
     confidentiality practices required under this subsection.
       ``(B) Model notice.--The Secretary, in consultation with 
     the National Committee on Vital and Health Statistics and the 
     National Association of Insurance Commissioners, and after 
     notice and opportunity for public comment, shall develop and 
     disseminate model notices of confidentiality practices. Use 
     of the model notice shall serve as a defense against claims 
     of receiving inappropriate notice.
       ``(2) Establishment of safeguards.--A group health plan, or 
     a health insurance issuer offering health insurance coverage 
     in connection with a group health plan, shall establish and 
     maintain appropriate administrative, technical, and physical 
     safeguards to protect the confidentiality, security, 
     accuracy, and integrity of predictive genetic information 
     created, received, obtained, maintained, used, transmitted, 
     or disposed of by such plan or issuer.''.
       (c) Definitions.--Section 733(d) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1191b(d)) is amended 
     by adding at the end the following:
       ``(5) Family member.--The term `family member' means with 
     respect to an individual--
       ``(A) the spouse of the individual;
       ``(B) a dependent child of the individual, including a 
     child who is born to or placed for adoption with the 
     individual; and
       ``(C) all other individuals related by blood to the 
     individual or the spouse or child described in subparagraph 
     (A) or (B).
       ``(6) Genetic information.--The term `genetic information' 
     means information about genes, gene products, or inherited 
     characteristics that may derive from an individual or a 
     family member (including information about a request for or 
     receipt of genetic services).
       ``(7) Genetic services.--The term `genetic services' means 
     health services provided to obtain, assess, or interpret 
     genetic information for diagnostic and therapeutic purposes, 
     and for genetic education and counseling.
       ``(8) Predictive genetic information.--
       ``(A) In general.--The term `predictive genetic 
     information' means, in the absence of symptoms, clinical 
     signs, or a diagnosis of the condition related to such 
     information--
       ``(i) information about an individual's genetic tests;
       ``(ii) information about genetic tests of family members of 
     the individual; or
       ``(iii) information about the occurrence of a disease or 
     disorder in family members.
       ``(B) Exceptions.--The term `predictive genetic 
     information' shall not include--
       ``(i) information about the sex or age of the individual;
       ``(ii) information derived from physical tests, such as the 
     chemical, blood, or urine analyses of the individual 
     including cholesterol tests; and
       ``(iii) information about physical exams of the individual.
       ``(9) Genetic test.--The term `genetic test' means the 
     analysis of human DNA, RNA, chromosomes, proteins, and 
     certain metabolites, including analysis of genotypes, 
     mutations, phenotypes, or karyotypes, for the purpose of 
     predicting risk of disease in asymptomatic or undiagnosed 
     individuals. Such term does not include physical tests, such 
     as the chemical, blood, or urine analyses of the individual 
     including cholesterol tests, and physical exams of the 
     individual, in order to detect symptoms, clinical signs, or a 
     diagnosis of disease.''.
       (d) Effective Date.--Except as provided in this section, 
     this section and the amendments made by this section shall 
     apply with respect to group health plans for plan years 
     beginning 1 year after the date of the enactment of this Act.

     SEC. 303. AMENDMENTS TO THE PUBLIC HEALTH SERVICE ACT.

       (a) Amendments Relating to the Group Market.--
       (1) Prohibition of health discrimination on the basis of 
     genetic information in the group market.--
       (A) No enrollment restriction for genetic services.--
     Section 2702(a)(1)(F) of the Public Health Service Act (42 
     U.S.C. 300gg-1(a)(1)(F)) is amended by inserting before the 
     period the following: ``(including information about a 
     request for or receipt of genetic services)''.
       (B) No discrimination in premiums based on predictive 
     genetic information.--Subpart 2 of part A of title XXVII of 
     the Public Health Service Act, as amended by section 201, is 
     further amended by adding at the end the following new 
     section:

     ``SEC. 2708. PROHIBITING PREMIUM DISCRIMINATION AGAINST 
                   GROUPS ON THE BASIS OF PREDICTIVE GENETIC 
                   INFORMATION IN THE GROUP MARKET.

       ``A group health plan, or a health insurance issuer 
     offering group health insurance coverage in connection with a 
     group health plan shall not adjust premium or contribution 
     amounts for a group on the basis of predictive genetic 
     information concerning any individual (including a dependent) 
     or family

[[Page S8757]]

     member of the individual (including information about a 
     request for or receipt of genetic services).''.
       (C) Conforming amendment.--Section 2702(b) of the Public 
     Health Service Act (42 U.S.C. 300gg-1(b)) is amended by 
     adding at the end the following:
       ``(3) Reference to related provision.--For a provision 
     prohibiting the adjustment of premium or contribution amounts 
     for a group under a group health plan on the basis of 
     predictive genetic information (including information about a 
     request for or receipt of genetic services), see section 
     2708.''.
       (D) Limitation on collection and disclosure of predictive 
     genetic information.--Section 2702 of the Public Health 
     Service Act (42 U.S.C. 300gg-1) is amended by adding at the 
     end the following:
       ``(c) Collection of Predictive Genetic Information.--
       ``(1) Limitation on requesting or requiring predictive 
     genetic information.--Except as provided in paragraph (2), a 
     group health plan, or a health insurance issuer offering 
     health insurance coverage in connection with a group health 
     plan, shall not request or require predictive genetic 
     information concerning any individual (including a dependent) 
     or a family member of the individual (including information 
     about a request for or receipt of genetic services).
       ``(2) Information needed for diagnosis, treatment, or 
     payment.--
       ``(A) In general.--Notwithstanding paragraph (1), a group 
     health plan, or a health insurance issuer offering health 
     insurance coverage in connection with a group health plan, 
     that provides health care items and services to an individual 
     or dependent may request (but may not require) that such 
     individual or dependent disclose, or authorize the collection 
     or disclosure of, predictive genetic information for purposes 
     of diagnosis, treatment, or payment relating to the provision 
     of health care items and services to such individual or 
     dependent.
       ``(B) Notice of confidentiality practices and description 
     of safeguards.--As a part of a request under subparagraph 
     (A), the group health plan, or a health insurance issuer 
     offering health insurance coverage in connection with a group 
     health plan, shall provide to the individual or dependent a 
     description of the procedures in place to safeguard the 
     confidentiality, as described in subsection (d), of such 
     predictive genetic information.
       ``(d) Confidentiality with Respect to Predictive Genetic 
     Information.--
       ``(1) Notice of confidentiality practices.--
       ``(A) Preparation of written notice.--A group health plan, 
     or a health insurance issuer offering health insurance 
     coverage in connection with a group health plan, shall post 
     or provide, in writing and in a clear and conspicuous manner, 
     notice of the plan or issuer's confidentiality practices, 
     that shall include--
       ``(i) a description of an individual's rights with respect 
     to predictive genetic information;
       ``(ii) the procedures established by the plan or issuer for 
     the exercise of the individual's rights; and
       ``(iii) the right to obtain a copy of the notice of the 
     confidentiality practices required under this subsection.
       ``(B) Model notice.--The Secretary, in consultation with 
     the National Committee on Vital and Health Statistics and the 
     National Association of Insurance Commissioners, and after 
     notice and opportunity for public comment, shall develop and 
     disseminate model notices of confidentiality practices. Use 
     of the model notice shall serve as a defense against claims 
     of receiving inappropriate notice.
       ``(2) Establishment of safeguards.--A group health plan, or 
     a health insurance issuer offering health insurance coverage 
     in connection with a group health plan, shall establish and 
     maintain appropriate administrative, technical, and physical 
     safeguards to protect the confidentiality, security, 
     accuracy, and integrity of predictive genetic information 
     created, received, obtained, maintained, used, transmitted, 
     or disposed of by such plan or issuer.''.
       (2) Definitions.--Section 2791(d) of the Public Health 
     Service Act (42 U.S.C. 300gg-91(d)) is amended by adding at 
     the end the following:
       ``(15) Family member.--The term `family member' means, with 
     respect to an individual--
       ``(A) the spouse of the individual;
       ``(B) a dependent child of the individual, including a 
     child who is born to or placed for adoption with the 
     individual; and
       ``(C) all other individuals related by blood to the 
     individual or the spouse or child described in subparagraph 
     (A) or (B).
       ``(16) Genetic information.--The term `genetic information' 
     means information about genes, gene products, or inherited 
     characteristics that may derive from an individual or a 
     family member (including information about a request for or 
     receipt of genetic services).
       ``(17) Genetic services.--The term `genetic services' means 
     health services provided to obtain, assess, or interpret 
     genetic information for diagnostic and therapeutic purposes, 
     and for genetic education and counseling.
       ``(18) Predictive genetic information.--
       ``(A) In general.--The term `predictive genetic 
     information' means, in the absence of symptoms, clinical 
     signs, or a diagnosis of the condition related to such 
     information--
       ``(i) information about an individual's genetic tests;
       ``(ii) information about genetic tests of family members of 
     the individual; or
       ``(iii) information about the occurrence of a disease or 
     disorder in family members.
       ``(B) Exceptions.--The term `predictive genetic 
     information' shall not include--
       ``(i) information about the sex or age of the individual;
       ``(ii) information derived from physical tests, such as the 
     chemical, blood, or urine analyses of the individual 
     including cholesterol tests; and
       ``(iii) information about physical exams of the individual.
       ``(19) Genetic test.--The term `genetic test' means the 
     analysis of human DNA, RNA, chromosomes, proteins, and 
     certain metabolites, including analysis of genotypes, 
     mutations, phenotypes, or karyotypes, for the purpose of 
     predicting risk of disease in asymptomatic or undiagnosed 
     individuals. Such term does not include physical tests, such 
     as the chemical, blood, or urine analyses of the individual 
     including cholesterol tests, and physical exams of the 
     individual, in order to detect symptoms, clinical signs, or a 
     diagnosis of disease.''.
       (b) Amendment Relating to the Individual Market.--Subpart 2 
     of part B of title XXVII of the Public Health Service Act, as 
     amended by section 201, is further amended by adding at the 
     end the following new section:

     ``SEC. 2754. PROHIBITION OF HEALTH DISCRIMINATION ON THE 
                   BASIS OF PREDICTIVE GENETIC INFORMATION.

       ``(a) Prohibition on Predictive Genetic Information as a 
     Condition of Eligibility.--A health insurance issuer offering 
     health insurance coverage in the individual market may not 
     use predictive genetic information as a condition of 
     eligibility of an individual to enroll in individual health 
     insurance coverage (including information about a request for 
     or receipt of genetic services).
       ``(b) Prohibition on Predictive Genetic Information in 
     Setting Premium Rates.--A health insurance issuer offering 
     health insurance coverage in the individual market shall not 
     adjust premium rates for individuals on the basis of 
     predictive genetic information concerning such an individual 
     (including a dependent) or a family member of the individual 
     (including information about a request for or receipt of 
     genetic services).
       ``(c) Collection of Predictive Genetic Information.--
       ``(1) Limitation on requesting or requiring predictive 
     genetic information.--Except as provided in paragraph (2), a 
     health insurance issuer offering health insurance coverage in 
     the individual market shall not request or require predictive 
     genetic information concerning any individual (including a 
     dependent) or a family member of the individual (including 
     information about a request for or receipt of genetic 
     services).
       ``(2) Information needed for diagnosis, treatment, or 
     payment.--
       ``(A) in general.--Notwithstanding paragraph (1), a health 
     insurance issuer offering health insurance coverage in the 
     individual market that provides health care items and 
     services to an individual or dependent may request (but may 
     not require) that such individual or dependent disclose, or 
     authorize the collection or disclosure of, predictive genetic 
     information for purposes of diagnosis, treatment, or payment 
     relating to the provision of health care items and services 
     to such individual or dependent.
       ``(B) Notice of confidentiality practices and description 
     of safeguards.--As a part of a request under subparagraph 
     (A), the health insurance issuer offering health insurance 
     coverage in the individual market shall provide to the 
     individual or dependent a description of the procedures in 
     place to safeguard the confidentiality, as described in 
     subsection (d), of such predictive genetic information.
       ``(d) Confidentiality with Respect to Predictive Genetic 
     Information.--
       ``(1) Notice of confidentiality practices.--
       ``(A) Preparation of written notice.--A health insurance 
     issuer offering health insurance coverage in the individual 
     market shall post or provide, in writing and in a clear and 
     conspicuous manner, notice of the issuer's confidentiality 
     practices, that shall include--
       ``(i) a description of an individual's rights with respect 
     to predictive genetic information;
       ``(ii) the procedures established by the issuer for the 
     exercise of the individual's rights; and
       ``(iii) the right to obtain a copy of the notice of the 
     confidentiality practices required under this subsection.
       ``(B) Model notice.--The Secretary, in consultation with 
     the National Committee on Vital and Health Statistics and the 
     National Association of Insurance Commissioners, and after 
     notice and opportunity for public comment, shall develop and 
     disseminate model notices of confidentiality practices. Use 
     of the model notice shall serve as a defense against claims 
     of receiving inappropriate notice.
       ``(2) Establishment of safeguards.--A health insurance 
     issuer offering health insurance coverage in the individual 
     market shall establish and maintain appropriate 
     administrative, technical, and physical safeguards to

[[Page S8758]]

     protect the confidentiality, security, accuracy, and 
     integrity of predictive genetic information created, 
     received, obtained, maintained, used, transmitted, or 
     disposed of by such issuer.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply with respect to--
       (1) group health plans, and health insurance coverage 
     offered in connection with group health plans, for plan years 
     beginning after 1 year after the date of enactment of this 
     Act; and
       (2) health insurance coverage offered, sold, issued, 
     renewed, in effect, or operated in the individual market 
     after 1 year after the date of enactment of this Act.

     SEC. 304. AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1986.

       (a) Prohibition of Health Discrimination on the Basis of 
     Genetic Information or Genetic Services.--
       (1) No enrollment restriction for genetic services.--
     Section 9802(a)(1)(F) of the Internal Revenue Code of 1986 is 
     amended by inserting before the period the following: 
     ``(including information about a request for or receipt of 
     genetic services)''.
       (2) No discrimination in group premiums based on predictive 
     genetic information.--
       (A) In general.--Subchapter B of chapter 100 of the 
     Internal Revenue Code of 1986, as amended by sections 111(b) 
     and 201, is further amended by adding at the end the 
     following:

     ``SEC. 9815. PROHIBITING PREMIUM DISCRIMINATION AGAINST 
                   GROUPS ON THE BASIS OF PREDICTIVE GENETIC 
                   INFORMATION.

       ``A group health plan shall not adjust premium or 
     contribution amounts for a group on the basis of predictive 
     genetic information concerning any individual (including a 
     dependent) or a family member of the individual (including 
     information about a request for or receipt of genetic 
     services).''.
       (B) Conforming amendment.--Section 9802(b) of the Internal 
     Revenue Code of 1986 is amended by adding at the end the 
     following:
       ``(3) Reference to related provision.--For a provision 
     prohibiting the adjustment of premium or contribution amounts 
     for a group under a group health plan on the basis of 
     predictive genetic information (including information about a 
     request for or the receipt of genetic services), see section 
     9815.''.
       (C) Amendment to table of sections.--The table of sections 
     for subchapter B of chapter 100 of the Internal Revenue Code 
     of 1986, as amended by sections 111(b) and 201, is further 
     amended by adding at the end the following:

``Sec. 9816. Prohibiting premium discrimination against groups on the 
              basis of predictive genetic information.''.
       (b) Limitation on Collection of Predictive Genetic 
     Information.--Section 9802 of the Internal Revenue Code of 
     1986 is amended by adding at the end the following:
       ``(d) Collection of Predictive Genetic Information.--
       ``(1) Limitation on requesting or requiring predictive 
     genetic information.--Except as provided in paragraph (2), a 
     group health plan shall not request or require predictive 
     genetic information concerning any individual (including a 
     dependent) or a family member of the individual (including 
     information about a request for or receipt of genetic 
     services).
       ``(2) Information needed for diagnosis, treatment, or 
     payment.--
       ``(A) In general.--Notwithstanding paragraph (1), a group 
     health plan that provides health care items and services to 
     an individual or dependent may request (but may not require) 
     that such individual or dependent disclose, or authorize the 
     collection or disclosure of, predictive genetic information 
     for purposes of diagnosis, treatment, or payment relating to 
     the provision of health care items and services to such 
     individual or dependent.
       ``(B) Notice of confidentiality practices; description of 
     safeguards.--As a part of a request under subparagraph (A), 
     the group health plan shall provide to the individual or 
     dependent a description of the procedures in place to 
     safeguard the confidentiality, as described in subsection 
     (e), of such predictive genetic information.
       ``(e) Confidentiality with Respect to Predictive Genetic 
     Information.--
       ``(1) Notice of confidentiality practices.--
       ``(A) Preparation of written notice.--A group health plan 
     shall post or provide, in writing and in a clear and 
     conspicuous manner, notice of the plan's confidentiality 
     practices, that shall include--
       ``(i) a description of an individual's rights with respect 
     to predictive genetic information;
       ``(ii) the procedures established by the plan for the 
     exercise of the individual's rights; and
       ``(iii) the right to obtain a copy of the notice of the 
     confidentiality practices required under this subsection.
       ``(B) Model notice.--The Secretary, in consultation with 
     the National Committee on Vital and Health Statistics and the 
     National Association of Insurance Commissioners, and after 
     notice and opportunity for public comment, shall develop and 
     disseminate model notices of confidentiality practices. Use 
     of the model notice shall serve as a defense against claims 
     of receiving inappropriate notice.
       ``(2) Establishment of safeguards.--A group health plan 
     shall establish and maintain appropriate administrative, 
     technical, and physical safeguards to protect the 
     confidentiality, security, accuracy, and integrity of 
     predictive genetic information created, received, obtained, 
     maintained, used, transmitted, or disposed of by such 
     plan.''.
       (c) Definitions.--Section 9832(d) of the Internal Revenue 
     Code of 1986 is amended by adding at the end the following:
       ``(6) Family member.--The term `family member' means, with 
     respect to an individual--
       ``(A) the spouse of the individual;
       ``(B) a dependent child of the individual, including a 
     child who is born to or placed for adoption with the 
     individual; and
       ``(C) all other individuals related by blood to the 
     individual or the spouse or child described in subparagraph 
     (A) or (B).
       ``(7) Genetic information.--The term `genetic information' 
     means information about genes, gene products, or inherited 
     characteristics that may derive from an individual or a 
     family member (including information about a request for or 
     receipt of genetic services).
       ``(8) Genetic services.--The term `genetic services' means 
     health services provided to obtain, assess, or interpret 
     genetic information for diagnostic and therapeutic purposes, 
     and for genetic education and counseling.
       ``(9) Predictive genetic information.--
       ``(A) In general.--The term `predictive genetic 
     information' means, in the absence of symptoms, clinical 
     signs, or a diagnosis of the condition related to such 
     information--
       ``(i) information about an individual's genetic tests;
       ``(ii) information about genetic tests of family members of 
     the individual; or
       ``(iii) information about the occurrence of a disease or 
     disorder in family members.
       ``(B) Exceptions.--The term `predictive genetic 
     information' shall not include--
       ``(i) information about the sex or age of the individual;
       ``(ii) information derived from physical tests, such as the 
     chemical, blood, or urine analyses of the individual 
     including cholesterol tests; and
       ``(iii) information about physical exams of the individual.
       ``(10) Genetic test.--The term `genetic test' means the 
     analysis of human DNA, RNA, chromosomes, proteins, and 
     certain metabolites, including analysis of genotypes, 
     mutations, phenotypes, or karyotypes, for the purpose of 
     predicting risk of disease in asymptomatic or undiagnosed 
     individuals. Such term does not include physical tests, such 
     as the chemical, blood, or urine analyses of the individual 
     including cholesterol tests, and physical exams of the 
     individual, in order to detect symptoms, clinical signs, or a 
     diagnosis of disease.''.
       (d) Effective Date.--Except as provided in this section, 
     this section and the amendments made by this section shall 
     apply with respect to group health plans for plan years 
     beginning after 1 year after the date of the enactment of 
     this Act.

               TITLE IV--HEALTHCARE RESEARCH AND QUALITY

     SEC. 401. SHORT TITLE.

       This title may be cited as the ``Healthcare Research and 
     Quality Act of 1999''.

     SEC. 402. AMENDMENT TO THE PUBLIC HEALTH SERVICE ACT.

       Title IX of the Public Health Service Act (42 U.S.C. 299 et 
     seq.) is amended to read as follows:

         ``TITLE IX--AGENCY FOR HEALTHCARE RESEARCH AND QUALITY

               ``PART A--ESTABLISHMENT AND GENERAL DUTIES

     ``SEC. 901. MISSION AND DUTIES.

       ``(a) In General.--There is established within the Public 
     Health Service an agency to be known as the Agency for 
     Healthcare Research and Quality. In carrying out this 
     subsection, the Secretary shall redesignate the Agency for 
     Health Care Policy and Research as the Agency for Healthcare 
     Research and Quality.
       ``(b) Mission.--The purpose of the Agency is to enhance the 
     quality, appropriateness, and effectiveness of healthcare 
     services, and access to such services, through the 
     establishment of a broad base of scientific research and 
     through the promotion of improvements in clinical and health 
     system practices, including the prevention of diseases and 
     other health conditions. The Agency shall promote healthcare 
     quality improvement by--
       ``(1) conducting and supporting research that develops and 
     presents scientific evidence regarding all aspects of 
     healthcare, including--
       ``(A) the development and assessment of methods for 
     enhancing patient participation in their own care and for 
     facilitating shared patient-physician decision-making;
       ``(B) the outcomes, effectiveness, and cost-effectiveness 
     of healthcare practices, including preventive measures and 
     long-term care;
       ``(C) existing and innovative technologies;
       ``(D) the costs and utilization of, and access to 
     healthcare;
       ``(E) the ways in which healthcare services are organized, 
     delivered, and financed and the interaction and impact of 
     these factors on the quality of patient care;
       ``(F) methods for measuring quality and strategies for 
     improving quality; and
       ``(G) ways in which patients, consumers, purchasers, and 
     practitioners acquire new information about best practices 
     and health

[[Page S8759]]

     benefits, the determinants and impact of their use of this 
     information;
       ``(2) synthesizing and disseminating available scientific 
     evidence for use by patients, consumers, practitioners, 
     providers, purchasers, policy makers, and educators; and
       ``(3) advancing private and public efforts to improve 
     healthcare quality.
       ``(c) Requirements With Respect to Rural Areas and Priority 
     Populations.--In carrying out subsection (b), the Director 
     shall undertake and support research, demonstration projects, 
     and evaluations with respect to the delivery of health 
     services--
       ``(1) in rural areas (including frontier areas);
       ``(2) for low-income groups, and minority groups;
       ``(3) for children;
       ``(4) for elderly; and
       ``(5) for people with special healthcare needs, including 
     disabilities, chronic care and end-of-life healthcare.
       ``(d) Appointment of Director.--There shall be at the head 
     of the Agency an official to be known as the Director for 
     Healthcare Research and Quality. The Director shall be 
     appointed by the Secretary. The Secretary, acting through the 
     Director, shall carry out the authorities and duties 
     established in this title.

     ``SEC. 902. GENERAL AUTHORITIES.

       ``(a) In General.--In carrying out section 901(b), the 
     Director shall support demonstration projects, conduct and 
     support research, evaluations, training, research networks, 
     multi-disciplinary centers, technical assistance, and the 
     dissemination of information, on healthcare, and on systems 
     for the delivery of such care, including activities with 
     respect to--
       ``(1) the quality, effectiveness, efficiency, 
     appropriateness and value of healthcare services;
       ``(2) quality measurement and improvement;
       ``(3) the outcomes, cost, cost-effectiveness, and use of 
     healthcare services and access to such services;
       ``(4) clinical practice, including primary care and 
     practice-oriented research;
       ``(5) healthcare technologies, facilities, and equipment;
       ``(6) healthcare costs, productivity, organization, and 
     market forces;
       ``(7) health promotion and disease prevention, including 
     clinical preventive services;
       ``(8) health statistics, surveys, database development, and 
     epidemiology; and
       ``(9) medical liability.
       ``(b) Health Services Training Grants.--
       ``(1) In general.--The Director may provide training grants 
     in the field of health services research related to 
     activities authorized under subsection (a), to include pre- 
     and post-doctoral fellowships and training programs, young 
     investigator awards, and other programs and activities as 
     appropriate. In carrying out this subsection, the Director 
     shall make use of funds made available under section 487 as 
     well as other appropriated funds.
       ``(2) Requirements.--In developing priorities for the 
     allocation of training funds under this subsection, the 
     Director shall take into consideration shortages in the 
     number of trained researchers addressing the priority 
     populations.
       ``(c) Multidisciplinary Centers.--The Director may provide 
     financial assistance to assist in meeting the costs of 
     planning and establishing new centers, and operating existing 
     and new centers, for multidisciplinary health services 
     research, demonstration projects, evaluations, training, and 
     policy analysis with respect to the matters referred to in 
     subsection (a).
       ``(d) Relation to Certain Authorities Regarding Social 
     Security.--Activities authorized in this section shall be 
     appropriately coordinated with experiments, demonstration 
     projects, and other related activities authorized by the 
     Social Security Act and the Social Security Amendments of 
     1967. Activities under subsection (a)(2) of this section that 
     affect the programs under titles XVIII, XIX and XXI of the 
     Social Security Act shall be carried out consistent with 
     section 1142 of such Act.
       ``(e) Disclaimer.--The Agency shall not mandate national 
     standards of clinical practice or quality healthcare 
     standards. Recommendations resulting from projects funded and 
     published by the Agency shall include a corresponding 
     disclaimer.
       ``(f) Rule of Construction.--Nothing in this section shall 
     be construed to imply that the Agency's role is to mandate a 
     national standard or specific approach to quality measurement 
     and reporting. In research and quality improvement 
     activities, the Agency shall consider a wide range of 
     choices, providers, healthcare delivery systems, and 
     individual preferences.

               ``PART B--HEALTHCARE IMPROVEMENT RESEARCH

     ``SEC. 911. HEALTHCARE OUTCOME IMPROVEMENT RESEARCH.

       ``(a) Evidence Rating Systems.--In collaboration with 
     experts from the public and private sector, the Agency shall 
     identify and disseminate methods or systems that it uses to 
     assess healthcare research results, particularly methods or 
     systems that it uses to rate the strength of the scientific 
     evidence behind healthcare practice, recommendations in the 
     research literature, and technology assessments. The Agency 
     shall make methods and systems for evidence rating widely 
     available. Agency publications containing healthcare 
     recommendations shall indicate the level of substantiating 
     evidence using such methods or systems.
       ``(b) Healthcare Improvement Research Centers and Provider-
     Based Research Networks.--In order to address the full 
     continuum of care and outcomes research, to link research to 
     practice improvement, and to speed the dissemination of 
     research findings to community practice settings, the Agency 
     shall employ research strategies and mechanisms that will 
     link research directly with clinical practice in 
     geographically diverse locations throughout the United 
     States, including--
       ``(1) Healthcare Improvement Research Centers that combine 
     demonstrated multidisciplinary expertise in outcomes or 
     quality improvement research with linkages to relevant sites 
     of care;
       ``(2) Provider-based Research Networks, including plan, 
     facility, or delivery system sites of care (especially 
     primary care), that can evaluate and promote quality 
     improvement; and
       ``(3) other innovative mechanisms or strategies to link 
     research with clinical practice.

     ``SEC. 912. PRIVATE-PUBLIC PARTNERSHIPS TO IMPROVE 
                   ORGANIZATION AND DELIVERY.

       ``(a) Support for Efforts To Develop Information on 
     Quality.--
       ``(1) Scientific and technical support.--In its role as the 
     principal agency for healthcare research and quality, the 
     Agency may provide scientific and technical support for 
     private and public efforts to improve healthcare quality, 
     including the activities of accrediting organizations.
       ``(2) Role of the agency.--With respect to paragraph (1), 
     the role of the Agency shall include--
       ``(A) the identification and assessment of methods for the 
     evaluation of the health of--
       ``(i) enrollees in health plans by type of plan, provider, 
     and provider arrangements; and
       ``(ii) other populations, including those receiving long-
     term care services;
       ``(B) the ongoing development, testing, and dissemination 
     of quality measures, including measures of health and 
     functional outcomes;
       ``(C) the compilation and dissemination of healthcare 
     quality measures developed in the private and public sector;
       ``(D) assistance in the development of improved healthcare 
     information systems;
       ``(E) the development of survey tools for the purpose of 
     measuring participant and beneficiary assessments of their 
     healthcare; and
       ``(F) identifying and disseminating information on 
     mechanisms for the integration of information on quality into 
     purchaser and consumer decision-making processes.
       ``(b) Centers for Education and Research on Therapeutics.--
       ``(1) In general.--The Secretary, acting through the 
     Director and in consultation with the Commissioner of Food 
     and Drugs, shall establish a program for the purpose of 
     making one or more grants for the establishment and operation 
     of one or more centers to carry out the activities specified 
     in paragraph (2).
       ``(2) Required activities.--The activities referred to in 
     this paragraph are the following:
       ``(A) The conduct of state-of-the-art clinical, laboratory, 
     or health services research for the following purposes:
       ``(i) To increase awareness of--

       ``(I) new uses of drugs, biological products, and devices;
       ``(II) ways to improve the effective use of drugs, 
     biological products, and devices; and
       ``(III) risks of new uses and risks of combinations of 
     drugs and biological products.

       ``(ii) To provide objective clinical information to the 
     following individuals and entities:

       ``(I) Healthcare practitioners and other providers of 
     healthcare goods or services.
       ``(II) Pharmacists, pharmacy benefit managers and 
     purchasers.
       ``(III) Health maintenance organizations and other managed 
     healthcare organizations.
       ``(IV) Healthcare insurers and governmental agencies.
       ``(V) Patients and consumers.

       ``(iii) To improve the quality of healthcare while reducing 
     the cost of Healthcare through--

       ``(I) an increase in the appropriate use of drugs, 
     biological products, or devices; and
       ``(II) the prevention of adverse effects of drugs, 
     biological products, and devices and the consequences of such 
     effects, such as unnecessary hospitalizations.

       ``(B) The conduct of research on the comparative 
     effectiveness, cost-effectiveness, and safety of drugs, 
     biological products, and devices.
       ``(C) Such other activities as the Secretary determines to 
     be appropriate, except that grant funds may not be used by 
     the Secretary in conducting regulatory review of new drugs.
       ``(c) Reducing Errors in Medicine.--The Director shall 
     conduct and support research and build private-public 
     partnerships to--
       ``(1) identify the causes of preventable healthcare errors 
     and patient injury in healthcare delivery;
       ``(2) develop, demonstrate, and evaluate strategies for 
     reducing errors and improving patient safety; and
       ``(3) promote the implementation of effective strategies 
     throughout the healthcare industry.

[[Page S8760]]

     ``SEC. 913. INFORMATION ON QUALITY AND COST OF CARE.

       ``(a) In General.--In carrying out 902(a), the Director 
     shall--
       ``(1) conduct a survey to collect data on a nationally 
     representative sample of the population on the cost, use and, 
     for fiscal year 2001 and subsequent fiscal years, quality of 
     healthcare, including the types of healthcare services 
     Americans use, their access to healthcare services, frequency 
     of use, how much is paid for the services used, the source of 
     those payments, the types and costs of private health 
     insurance, access, satisfaction, and quality of care for the 
     general population including rural residents and for the 
     populations identified in section 901(c); and
       ``(2) develop databases and tools that provide information 
     to States on the quality, access, and use of healthcare 
     services provided to their residents.
       ``(b) Quality and Outcomes Information.--
       ``(1) In general.--Beginning in fiscal year 2001, the 
     Director shall ensure that the survey conducted under 
     subsection (a)(1) will--
       ``(A) identify determinants of health outcomes and 
     functional status, and their relationships to healthcare 
     access and use, determine the ways and extent to which the 
     priority populations enumerated in section 901(c) differ from 
     the general population with respect to such variables, 
     measure changes over time with respect to such variable, and 
     monitor the overall national impact of changes in Federal and 
     State policy on healthcare;
       ``(B) provide information on the quality of care and 
     patient outcomes for frequently occurring clinical conditions 
     for a nationally representative sample of the population 
     including rural residents; and
       ``(C) provide reliable national estimates for children and 
     persons with special healthcare needs through the use of 
     supplements or periodic expansions of the survey.
     In expanding the Medical Expenditure Panel Survey, as in 
     existence on the date of enactment of this title, in fiscal 
     year 2001 to collect information on the quality of care, the 
     Director shall take into account any outcomes measurements 
     generally collected by private sector accreditation 
     organizations.
       ``(2) Annual report.--Beginning in fiscal year 2003, the 
     Secretary, acting through the Director, shall submit to 
     Congress an annual report on national trends in the quality 
     of healthcare provided to the American people.

     ``SEC. 914. INFORMATION SYSTEMS FOR HEALTHCARE IMPROVEMENT.

       ``(a) In General.--In order to foster a range of innovative 
     approaches to the management and communication of health 
     information, the Agency shall support research, evaluations 
     and initiatives to advance--
       ``(1) the use of information systems for the study of 
     healthcare quality, including the generation of both 
     individual provider and plan-level comparative performance 
     data;
       ``(2) training for healthcare practitioners and researchers 
     in the use of information systems;
       ``(3) the creation of effective linkages between various 
     sources of health information, including the development of 
     information networks;
       ``(4) the delivery and coordination of evidence-based 
     healthcare services, including the use of real-time 
     healthcare decision-support programs;
       ``(5) the utility and comparability of health information 
     data and medical vocabularies by addressing issues related to 
     the content, structure, definitions and coding of such 
     information and data in consultation with appropriate 
     Federal, State and private entities;
       ``(6) the use of computer-based health records in all 
     settings for the development of personal health records for 
     individual health assessment and maintenance, and for 
     monitoring public health and outcomes of care within 
     populations; and
       ``(7) the protection of individually identifiable 
     information in health services research and healthcare 
     quality improvement.
       ``(b) Demonstration.--The Agency shall support 
     demonstrations into the use of new information tools aimed at 
     improving shared decision-making between patients and their 
     care-givers.

     ``SEC. 915. RESEARCH SUPPORTING PRIMARY CARE AND ACCESS IN 
                   UNDERSERVED AREAS.

       ``(a) Preventive Services Task Force.--
       ``(1) Establishment and purpose.--The Director may 
     periodically convene a Preventive Services Task Force to be 
     composed of individuals with appropriate expertise. Such a 
     task force shall review the scientific evidence related to 
     the effectiveness, appropriateness, and cost-effectiveness of 
     clinical preventive services for the purpose of developing 
     recommendations for the healthcare community, and updating 
     previous clinical preventive recommendations.
       ``(2) Role of agency.--The Agency shall provide ongoing 
     administrative, research, and technical support for the 
     operations of the Preventive Services Task Force, including 
     coordinating and supporting the dissemination of the 
     recommendations of the Task Force.
       ``(3) Operation.--In carrying out its responsibilities 
     under paragraph (1), the Task Force is not subject to the 
     provisions of Appendix 2 of title 5, United States Code.
       ``(b) Primary Care Research.--
       ``(1) In general.--There is established within the Agency a 
     Center for Primary Care Research (referred to in this 
     subsection as the `Center') that shall serve as the principal 
     source of funding for primary care practice research in the 
     Department of Health and Human Services. For purposes of this 
     paragraph, primary care research focuses on the first contact 
     when illness or health concerns arise, the diagnosis, 
     treatment or referral to specialty care, preventive care, and 
     the relationship between the clinician and the patient in the 
     context of the family and community.
       ``(2) Research.--In carrying out this section, the Center 
     shall conduct and support research concerning--
       ``(A) the nature and characteristics of primary care 
     practice;
       ``(B) the management of commonly occurring clinical 
     problems;
       ``(C) the management of undifferentiated clinical problems; 
     and
       ``(D) the continuity and coordination of health services.

     ``SEC. 916. CLINICAL PRACTICE AND TECHNOLOGY INNOVATION.

       ``(a) In General.--The Director shall promote innovation in 
     evidence-based clinical practice and healthcare technologies 
     by--
       ``(1) conducting and supporting research on the 
     development, diffusion, and use of healthcare technology;
       ``(2) developing, evaluating, and disseminating 
     methodologies for assessments of healthcare practices and 
     healthcare technologies;
       ``(3) conducting intramural and supporting extramural 
     assessments of existing and new healthcare practices and 
     technologies;
       ``(4) promoting education, training, and providing 
     technical assistance in the use of healthcare practice and 
     healthcare technology assessment methodologies and results; 
     and
       ``(5) working with the National Library of Medicine and the 
     public and private sector to develop an electronic 
     clearinghouse of currently available assessments and those in 
     progress.
       ``(b) Specification of Process.--
       ``(1) In general.--Not later than December 31, 2000, the 
     Director shall develop and publish a description of the 
     methodology used by the Agency and its contractors in 
     conducting practice and technology assessment.
       ``(2) Consultations.--In carrying out this subsection, the 
     Director shall cooperate and consult with the Assistant 
     Secretary for Health, the Administrator of the Health Care 
     Financing Administration, the Director of the National 
     Institutes of Health, the Commissioner of Food and Drugs, and 
     the heads of any other interested Federal department or 
     agency, and shall seek input, where appropriate, from 
     professional societies and other private and public entities.
       ``(3) Methodology.--The Director, in developing assessment 
     methodology, shall consider--
       ``(A) safety, efficacy, and effectiveness;
       ``(B) legal, social, and ethical implications;
       ``(C) costs, benefits, and cost-effectiveness;
       ``(D) comparisons to alternate technologies and practices; 
     and
       ``(E) requirements of Food and Drug Administration approval 
     to avoid duplication.
       ``(c) Specific Assessments.--
       ``(1) In general.--The Director shall conduct or support 
     specific assessments of healthcare technologies and 
     practices.
       ``(2) Requests for assessments.--The Director is authorized 
     to conduct or support assessments, on a reimbursable basis, 
     for the Health Care Financing Administration, the Department 
     of Defense, the Department of Veterans Affairs, the Office of 
     Personnel Management, and other public or private entities.
       ``(3) Grants and contracts.--In addition to conducting 
     assessments, the Director may make grants to, or enter into 
     cooperative agreements or contracts with, entities described 
     in paragraph (4) for the purpose of conducting assessments of 
     experimental, emerging, existing, or potentially outmoded 
     healthcare technologies, and for related activities.
       ``(4) Eligible entities.--An entity described in this 
     paragraph is an entity that is determined to be appropriate 
     by the Director, including academic medical centers, research 
     institutions and organizations, professional organizations, 
     third party payers, governmental agencies, and consortia of 
     appropriate research entities established for the purpose of 
     conducting technology assessments.

     ``SEC. 917. COORDINATION OF FEDERAL GOVERNMENT QUALITY 
                   IMPROVEMENT EFFORTS.

       ``(a) Requirement.--
       ``(1) In general.--To avoid duplication and ensure that 
     Federal resources are used efficiently and effectively, the 
     Secretary, acting through the Director, shall coordinate all 
     research, evaluations, and demonstrations related to health 
     services research, quality measurement and quality 
     improvement activities undertaken and supported by the 
     Federal Government.
       ``(2) Specific activities.--The Director, in collaboration 
     with the appropriate Federal officials representing all 
     concerned executive agencies and departments, shall develop 
     and manage a process to--
       ``(A) improve interagency coordination, priority setting, 
     and the use and sharing of research findings and data 
     pertaining to Federal quality improvement programs, 
     technology assessment, and health services research;
       ``(B) strengthen the research information infrastructure, 
     including databases, pertaining to Federal health services 
     research

[[Page S8761]]

     and healthcare quality improvement initiatives;
       ``(C) set specific goals for participating agencies and 
     departments to further health services research and 
     healthcare quality improvement; and
       ``(D) strengthen the management of Federal healthcare 
     quality improvement programs.
       ``(b) Study by the Institute of Medicine.--
       ``(1) In general.--To provide Congress, the Department of 
     Health and Human Services, and other relevant departments 
     with an independent, external review of their quality 
     oversight, quality improvement and quality research programs, 
     the Secretary shall enter into a contract with the Institute 
     of Medicine--
       ``(A) to describe and evaluate current quality improvement, 
     quality research and quality monitoring processes through--
       ``(i) an overview of pertinent health services research 
     activities and quality improvement efforts conducted by all 
     Federal programs, with particular attention paid to those 
     under titles XVIII, XIX, and XXI of the Social Security Act; 
     and
       ``(ii) a summary of the partnerships that the Department of 
     Health and Human Services has pursued with private 
     accreditation, quality measurement and improvement 
     organizations; and
       ``(B) to identify options and make recommendations to 
     improve the efficiency and effectiveness of quality 
     improvement programs through--
       ``(i) the improved coordination of activities across the 
     medicare, medicaid and child health insurance programs under 
     titles XVIII, XIX and XXI of the Social Security Act and 
     health services research programs;
       ``(ii) the strengthening of patient choice and 
     participation by incorporating state-of-the-art quality 
     monitoring tools and making information on quality available; 
     and
       ``(iii) the enhancement of the most effective programs, 
     consolidation as appropriate, and elimination of duplicative 
     activities within various federal agencies.
       ``(2) Requirements.--
       ``(A) In general.--The Secretary shall enter into a 
     contract with the Institute of Medicine for the preparation--
       ``(i) not later than 12 months after the date of enactment 
     of this title, of a report providing an overview of the 
     quality improvement programs of the Department of Health and 
     Human Services for the medicare, medicaid, and CHIP programs 
     under titles XVIII, XIX, and XXI of the Social Security Act; 
     and
       ``(ii) not later than 24 months after the date of enactment 
     of this title, of a final report containing recommendations.
       ``(B) Reports.--The Secretary shall submit the reports 
     described in subparagraph (A) to the Committee on Finance and 
     the Committee on Health, Education, Labor, and Pensions of 
     the Senate and the Committee on Ways and Means and the 
     Committee on Commerce of the House of Representatives.

                      ``PART C--GENERAL PROVISIONS

     ``SEC. 921. ADVISORY COUNCIL FOR HEALTHCARE RESEARCH AND 
                   QUALITY.

       ``(a) Establishment.--There is established an advisory 
     council to be known as the Advisory Council for Healthcare 
     Research and Quality.
       ``(b) Duties.--
       ``(1) In general.--The Advisory Council shall advise the 
     Secretary and the Director with respect to activities 
     proposed or undertaken to carry out the purpose of the Agency 
     under section 901(b).
       ``(2) Certain recommendations.--Activities of the Advisory 
     Council under paragraph (1) shall include making 
     recommendations to the Director regarding--
       ``(A) priorities regarding healthcare research, especially 
     studies related to quality, outcomes, cost and the 
     utilization of, and access to, healthcare services;
       ``(B) the field of healthcare research and related 
     disciplines, especially issues related to training needs, and 
     dissemination of information pertaining to healthcare 
     quality; and
       ``(C) the appropriate role of the Agency in each of these 
     areas in light of private sector activity and identification 
     of opportunities for public-private sector partnerships.
       ``(c) Membership.--
       ``(1) In general.--The Advisory Council shall, in 
     accordance with this subsection, be composed of appointed 
     members and ex officio members. All members of the Advisory 
     Council shall be voting members other than the individuals 
     designated under paragraph (3)(B) as ex officio members.
       ``(2) Appointed members.--The Secretary shall appoint to 
     the Advisory Council 21 appropriately qualified individuals. 
     At least 17 members of the Advisory Council shall be 
     representatives of the public who are not officers or 
     employees of the United States. The Secretary shall ensure 
     that the appointed members of the Council, as a group, are 
     representative of professions and entities concerned with, or 
     affected by, activities under this title and under section 
     1142 of the Social Security Act. Of such members--
       ``(A) 4 shall be individuals distinguished in the conduct 
     of research, demonstration projects, and evaluations with 
     respect to healthcare;
       ``(B) 4 shall be individuals distinguished in the practice 
     of medicine of which at least 1 shall be a primary care 
     practitioner;
       ``(C) 3 shall be individuals distinguished in the other 
     health professions;
       ``(D) 4 shall be individuals either representing the 
     private healthcare sector, including health plans, providers, 
     and purchasers or individuals distinguished as administrators 
     of healthcare delivery systems;
       ``(E) 4 shall be individuals distinguished in the fields of 
     healthcare quality improvement, economics, information 
     systems, law, ethics, business, or public policy, including 
     at least 1 individual specializing in rural aspects in 1 or 
     more of these fields; and
       ``(F) 2 shall be individuals representing the interests of 
     patients and consumers of healthcare.
       ``(3) Ex officio members.--The Secretary shall designate as 
     ex officio members of the Advisory Council--
       ``(A) the Assistant Secretary for Health, the Director of 
     the National Institutes of Health, the Director of the 
     Centers for Disease Control and Prevention, the Administrator 
     of the Health Care Financing Administration, the Assistant 
     Secretary of Defense (Health Affairs), and the Under 
     Secretary for Health of the Department of Veterans Affairs; 
     and
       ``(B) such other Federal officials as the Secretary may 
     consider appropriate.
       ``(d) Terms.--Members of the Advisory Council appointed 
     under subsection (c)(2) shall serve for a term of 3 years. A 
     member of the Council appointed under such subsection may 
     continue to serve after the expiration of the term of the 
     members until a successor is appointed.
       ``(e) Vacancies.--If a member of the Advisory Council 
     appointed under subsection (c)(2) does not serve the full 
     term applicable under subsection (d), the individual 
     appointed to fill the resulting vacancy shall be appointed 
     for the remainder of the term of the predecessor of the 
     individual.
       ``(f) Chair.--The Director shall, from among the members of 
     the Advisory Council appointed under subsection (c)(2), 
     designate an individual to serve as the chair of the Advisory 
     Council.
       ``(g) Meetings.--The Advisory Council shall meet not less 
     than once during each discrete 4-month period and shall 
     otherwise meet at the call of the Director or the chair.
       ``(h) Compensation and Reimbursement of Expenses.--
       ``(1) Appointed members.--Members of the Advisory Council 
     appointed under subsection (c)(2) shall receive compensation 
     for each day (including travel time) engaged in carrying out 
     the duties of the Advisory Council unless declined by the 
     member. Such compensation may not be in an amount in excess 
     of the daily equivalent of the annual rate of basic pay 
     prescribed for level IV of the Executive Schedule under 
     section 5315 of title 5, United States Code, for each day 
     during which such member is engaged in the performance of the 
     duties of the Advisory Council.
       ``(2) Ex officio members.--Officials designated under 
     subsection (c)(3) as ex officio members of the Advisory 
     Council may not receive compensation for service on the 
     Advisory Council in addition to the compensation otherwise 
     received for duties carried out as officers of the United 
     States.
       ``(i) Staff.--The Director shall provide to the Advisory 
     Council such staff, information, and other assistance as may 
     be necessary to carry out the duties of the Council.

     ``SEC. 922. PEER REVIEW WITH RESPECT TO GRANTS AND CONTRACTS.

       ``(a) Requirement of Review.--
       ``(1) In general.--Appropriate technical and scientific 
     peer review shall be conducted with respect to each 
     application for a grant, cooperative agreement, or contract 
     under this title.
       ``(2) Reports to director.--Each peer review group to which 
     an application is submitted pursuant to paragraph (1) shall 
     report its finding and recommendations respecting the 
     application to the Director in such form and in such manner 
     as the Director shall require.
       ``(b) Approval as Precondition of Awards.--The Director may 
     not approve an application described in subsection (a)(1) 
     unless the application is recommended for approval by a peer 
     review group established under subsection (c).
       ``(c) Establishment of Peer Review Groups.--
       ``(1) In general.--The Director shall establish such 
     technical and scientific peer review groups as may be 
     necessary to carry out this section. Such groups shall be 
     established without regard to the provisions of title 5, 
     United States Code, that govern appointments in the 
     competitive service, and without regard to the provisions of 
     chapter 51, and subchapter III of chapter 53, of such title 
     that relate to classification and pay rates under the General 
     Schedule.
       ``(2) Membership.--The members of any peer review group 
     established under this section shall be appointed from among 
     individuals who by virtue of their training or experience are 
     eminently qualified to carry out the duties of such peer 
     review group. Officers and employees of the United States may 
     not constitute more than 25 percent of the membership of any 
     such group. Such officers and employees may not receive 
     compensation for service on such groups in addition to the 
     compensation otherwise received for these duties carried out 
     as such officers and employees.
       ``(3) Duration.--Notwithstanding section 14(a) of the 
     Federal Advisory Committee Act, peer review groups 
     established under this section may continue in existence 
     until otherwise provided by law.
       ``(4) Qualifications.--Members of any peer-review group 
     shall, at a minimum, meet the following requirements:

[[Page S8762]]

       ``(A) Such members shall agree in writing to treat 
     information received, pursuant to their work for the group, 
     as confidential information, except that this subparagraph 
     shall not apply to public records and public information.
       ``(B) Such members shall agree in writing to recuse 
     themselves from participation in the peer-review of specific 
     applications which present a potential personal conflict of 
     interest or appearance of such conflict, including employment 
     in a directly affected organization, stock ownership, or any 
     financial or other arrangement that might introduce bias in 
     the process of peer-review.
       ``(d) Authority for Procedural Adjustments in Certain 
     Cases.--In the case of applications for financial assistance 
     whose direct costs will not exceed $100,000, the Director may 
     make appropriate adjustments in the procedures otherwise 
     established by the Director for the conduct of peer review 
     under this section. Such adjustments may be made for the 
     purpose of encouraging the entry of individuals into the 
     field of research, for the purpose of encouraging clinical 
     practice-oriented or provider-based research, and for such 
     other purposes as the Director may determine to be 
     appropriate.
       ``(e) Regulations.--The Director shall issue regulations 
     for the conduct of peer review under this section.

     ``SEC. 923. CERTAIN PROVISIONS WITH RESPECT TO DEVELOPMENT, 
                   COLLECTION, AND DISSEMINATION OF DATA.

       ``(a) Standards With Respect to Utility of Data.--
       ``(1) In general.--To ensure the utility, accuracy, and 
     sufficiency of data collected by or for the Agency for the 
     purpose described in section 901(b), the Director shall 
     establish standard methods for developing and collecting such 
     data, taking into consideration--
       ``(A) other Federal health data collection standards; and
       ``(B) the differences between types of healthcare plans, 
     delivery systems, healthcare providers, and provider 
     arrangements.
       ``(2) Relationship with other department programs.--In any 
     case where standards under paragraph (1) may affect the 
     administration of other programs carried out by the 
     Department of Health and Human Services, including the 
     programs under title XVIII, XIX or XXI of the Social Security 
     Act, or may affect health information that is subject to a 
     standard developed under part C of title XI of the Social 
     Security Act, they shall be in the form of recommendations to 
     the Secretary for such program.
       ``(b) Statistics and Analyses.--The Director shall--
       ``(1) take appropriate action to ensure that statistics and 
     analyses developed under this title are of high quality, 
     timely, and duly comprehensive, and that the statistics are 
     specific, standardized, and adequately analyzed and indexed; 
     and
       ``(2) publish, make available, and disseminate such 
     statistics and analyses on as wide a basis as is practicable.
       ``(c) Authority Regarding Certain Requests.--Upon request 
     of a public or private entity, the Director may conduct or 
     support research or analyses otherwise authorized by this 
     title pursuant to arrangements under which such entity will 
     pay the cost of the services provided. Amounts received by 
     the Director under such arrangements shall be available to 
     the Director for obligation until expended.

     ``SEC. 924. DISSEMINATION OF INFORMATION.

       ``(a) In General.--The Director shall--
       ``(1) without regard to section 501 of title 44, United 
     States Code, promptly publish, make available, and otherwise 
     disseminate, in a form understandable and on as broad a basis 
     as practicable so as to maximize its use, the results of 
     research, demonstration projects, and evaluations conducted 
     or supported under this title;
       ``(2) ensure that information disseminated by the Agency is 
     science-based and objective and undertakes consultation as 
     necessary to assess the appropriateness and usefulness of the 
     presentation of information that is targeted to specific 
     audiences;
       ``(3) promptly make available to the public data developed 
     in such research, demonstration projects, and evaluations;
       ``(4) provide, in collaboration with the National Library 
     of Medicine where appropriate, indexing, abstracting, 
     translating, publishing, and other services leading to a more 
     effective and timely dissemination of information on 
     research, demonstration projects, and evaluations with 
     respect to healthcare to public and private entities and 
     individuals engaged in the improvement of healthcare delivery 
     and the general public, and undertake programs to develop new 
     or improved methods for making such information available; 
     and
       ``(5) as appropriate, provide technical assistance to State 
     and local government and health agencies and conduct liaison 
     activities to such agencies to foster dissemination.
       ``(b) Prohibition Against Restrictions.--Except as provided 
     in subsection (c), the Director may not restrict the 
     publication or dissemination of data from, or the results of, 
     projects conducted or supported under this title.
       ``(c) Limitation on Use of Certain Information.--No 
     information, if an establishment or person supplying the 
     information or described in it is identifiable, obtained in 
     the course of activities undertaken or supported under this 
     title may be used for any purpose other than the purpose for 
     which it was supplied unless such establishment or person has 
     consented (as determined under regulations of the Director) 
     to its use for such other purpose. Such information may not 
     be published or released in other form if the person who 
     supplied the information or who is described in it is 
     identifiable unless such person has consented (as determined 
     under regulations of the Director) to its publication or 
     release in other form.
       ``(d) Penalty.--Any person who violates subsection (c) 
     shall be subject to a civil monetary penalty of not more than 
     $10,000 for each such violation 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.

     ``SEC. 925. ADDITIONAL PROVISIONS WITH RESPECT TO GRANTS AND 
                   CONTRACTS.

       ``(a) Financial Conflicts of Interest.--With respect to 
     projects for which awards of grants, cooperative agreements, 
     or contracts are authorized to be made under this title, the 
     Director shall by regulation define--
       ``(1) the specific circumstances that constitute financial 
     interests in such projects that will, or may be reasonably 
     expected to, create a bias in favor of obtaining results in 
     the projects that are consistent with such interests; and
       ``(2) the actions that will be taken by the Director in 
     response to any such interests identified by the Director.
       ``(b) Requirement of Application.--The Director may not, 
     with respect to any program under this title authorizing the 
     provision of grants, cooperative agreements, or contracts, 
     provide any such financial assistance unless an application 
     for the assistance is submitted to the Secretary and the 
     application is in such form, is made in such manner, and 
     contains such agreements, assurances, and information as the 
     Director determines to be necessary to carry out the program 
     in involved.
       ``(c) Provision of Supplies and Services in Lieu of 
     Funds.--
       ``(1) In general.--Upon the request of an entity receiving 
     a grant, cooperative agreement, or contract under this title, 
     the Secretary may, subject to paragraph (2), provide 
     supplies, equipment, and services for the purpose of aiding 
     the entity in carrying out the project involved and, for such 
     purpose, may detail to the entity any officer or employee of 
     the Department of Health and Human Services.
       ``(2) Corresponding reduction in funds.--With respect to a 
     request described in paragraph (1), the Secretary shall 
     reduce the amount of the financial assistance involved by an 
     amount equal to the costs of detailing personnel and the fair 
     market value of any supplies, equipment, or services provided 
     by the Director. The Secretary shall, for the payment of 
     expenses incurred in complying with such request, expend the 
     amounts withheld.
       ``(d) Applicability of Certain Provisions With Respect to 
     Contracts.--Contracts may be entered into under this part 
     without regard to sections 3648 and 3709 of the Revised 
     Statutes (31 U.S.C. 529; 41 U.S.C. 5).

     ``SEC. 926. CERTAIN ADMINISTRATIVE AUTHORITIES.

       ``(a) Deputy Director and Other Officers and Employees.--
       ``(1) Deputy director.--The Director may appoint a deputy 
     director for the Agency.
       ``(2) Other officers and employees.--The Director may 
     appoint and fix the compensation of such officers and 
     employees as may be necessary to carry out this title. Except 
     as otherwise provided by law, such officers and employees 
     shall be appointed in accordance with the civil service laws 
     and their compensation fixed in accordance with title 5, 
     United States Code.
       ``(b) Facilities.--The Secretary, in carrying out this 
     title--
       ``(1) may acquire, without regard to the Act of March 3, 
     1877 (40 U.S.C. 34), by lease or otherwise through the 
     Director of General Services, buildings or portions of 
     buildings in the District of Columbia or communities located 
     adjacent to the District of Columbia for use for a period not 
     to exceed 10 years; and
       ``(2) may acquire, construct, improve, repair, operate, and 
     maintain laboratory, research, and other necessary facilities 
     and equipment, and such other real or personal property 
     (including patents) as the Secretary deems necessary.
       ``(c) Provision of Financial Assistance.--The Director, in 
     carrying out this title, may make grants to public and 
     nonprofit entities and individuals, and may enter into 
     cooperative agreements or contracts with public and private 
     entities and individuals.
       ``(d) Utilization of Certain Personnel and Resources.--
       ``(1) Department of health and human services.--The 
     Director, in carrying out this title, may utilize personnel 
     and equipment, facilities, and other physical resources of 
     the Department of Health and Human Services, permit 
     appropriate (as determined by the Secretary) entities and 
     individuals to utilize the physical resources of such 
     Department, and provide technical assistance and advice.
       ``(2) Other agencies.--The Director, in carrying out this 
     title, may use, with their consent, the services, equipment, 
     personnel, information, and facilities of other Federal, 
     State, or local public agencies, or of any foreign 
     government, with or without reimbursement of such agencies.
       ``(e) Consultants.--The Secretary, in carrying out this 
     title, may secure, from time

[[Page S8763]]

     to time and for such periods as the Director deems advisable 
     but in accordance with section 3109 of title 5, United States 
     Code, the assistance and advice of consultants from the 
     United States or abroad.
       ``(f) Experts.--
       ``(1) In general.--The Secretary may, in carrying out this 
     title, obtain the services of not more than 50 experts or 
     consultants who have appropriate scientific or professional 
     qualifications. Such experts or consultants shall be obtained 
     in accordance with section 3109 of title 5, United States 
     Code, except that the limitation in such section on the 
     duration of service shall not apply.
       ``(2) Travel expenses.--
       ``(A) In general.--Experts and consultants whose services 
     are obtained under paragraph (1) shall be paid or reimbursed 
     for their expenses associated with traveling to and from 
     their assignment location in accordance with sections 5724, 
     5724a(a), 5724a(c), and 5726(C) of title 5, United States 
     Code.
       ``(B) Limitation.--Expenses specified in subparagraph (A) 
     may not be allowed in connection with the assignment of an 
     expert or consultant whose services are obtained under 
     paragraph (1) unless and until the expert agrees in writing 
     to complete the entire period of assignment, or 1 year, 
     whichever is shorter, unless separated or reassigned for 
     reasons that are beyond the control of the expert or 
     consultant and that are acceptable to the Secretary. If the 
     expert or consultant violates the agreement, the money spent 
     by the United States for the expenses specified in 
     subparagraph (A) is recoverable from the expert or consultant 
     as a statutory obligation owed to the United States. The 
     Secretary may waive in whole or in part a right of recovery 
     under this subparagraph.
       ``(g) Voluntary and Uncompensated Services.--The Director, 
     in carrying out this title, may accept voluntary and 
     uncompensated services.

     ``SEC. 927. FUNDING.

       ``(a) Intent.--To ensure that the United States's 
     investment in biomedical research is rapidly translated into 
     improvements in the quality of patient care, there must be a 
     corresponding investment in research on the most effective 
     clinical and organizational strategies for use of these 
     findings in daily practice. The authorization levels in 
     subsection (b) provide for a proportionate increase in 
     healthcare research as the United States investment in 
     biomedical research increases.
       ``(b) Authorization of Appropriations.--For the purpose of 
     carrying out this title, there are authorized to be 
     appropriated $250,000,000 for fiscal year 2000, and such sums 
     as may be necessary for each of the fiscal years 2001 through 
     2006.
       ``(c) Evaluations.--In addition to amounts available 
     pursuant to subsection (b) for carrying out this title, there 
     shall be made available for such purpose, from the amounts 
     made available pursuant to section 241 (relating to 
     evaluations), an amount equal to 40 percent of the maximum 
     amount authorized in such section 241 to be made available 
     for a fiscal year.

     ``SEC. 928. DEFINITIONS.

       ``In this title:
       ``(1) Advisory council.--The term `Advisory Council' means 
     the Advisory Council on Healthcare Research and Quality 
     established under section 921.
       ``(2) Agency.--The term `Agency' means the Agency for 
     Healthcare Research and Quality.
       ``(3) Director.--The term `Director' means the Director for 
     the Agency for Healthcare Research and Quality.''.

     SEC. 403. REFERENCES.

       Effective upon the date of enactment of this Act, any 
     reference in law to the ``Agency for Health Care Policy and 
     Research'' shall be deemed to be a reference to the ``Agency 
     for Healthcare Research and Quality''.

         TITLE V--ENHANCED ACCESS TO HEALTH INSURANCE COVERAGE

     SEC. 501. FULL DEDUCTION OF HEALTH INSURANCE COSTS FOR SELF-
                   EMPLOYED INDIVIDUALS.

       (a) In General.--Section 162(l)(1) of the Internal Revenue 
     Code of 1986 (relating to allowance of deductions) is amended 
     to read as follows:
       ``(1) Allowance of deduction.--In the case of an individual 
     who is an employee within the meaning of section 401(c)(1), 
     there shall be allowed as a deduction under this section an 
     amount equal to the amount paid during the taxable year for 
     insurance which constitutes medical care for the taxpayer, 
     his spouse, and his dependents.''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1999.

     SEC. 502. FULL AVAILABILITY OF MEDICAL SAVINGS ACCOUNTS.

       (a) Availability Not Limited To Accounts for Employees of 
     Small Employers and Self-Employed Individuals.--
       (1) In general.--Section 220(c)(1)(A) of the Internal 
     Revenue Code of 1986 (relating to eligible individual) is 
     amended to read as follows:
       ``(A) In general.--The term `eligible individual' means, 
     with respect to any month, any individual if--
       ``(i) such individual is covered under a high deductible 
     health plan as of the 1st day of such month, and
       ``(ii) such individual is not, while covered under a high 
     deductible health plan, covered under any health plan--

       ``(I) which is not a high deductible health plan, and
       ``(II) which provides coverage for any benefit which is 
     covered under the high deductible health plan.''.

       (2) Conforming amendments.--
       (A) Section 220(c)(1) of such Code is amended by striking 
     subparagraphs (C) and (D).
       (B) Section 220(c) of such Code is amended by striking 
     paragraph (4) (defining small employer) and by redesignating 
     paragraph (5) as paragraph (4).
       (C) Section 220(b) of such Code is amended by striking 
     paragraph (4) (relating to deduction limited by compensation) 
     and by redesignating paragraphs (5), (6), and (7) as 
     paragraphs (4), (5), and (6), respectively.
       (b) Removal of Limitation on Number of Taxpayers Having 
     Medical Savings Accounts.--
       (1) In general.--Section 220 of the Internal Revenue Code 
     of 1986 (relating to medical savings accounts) is amended by 
     striking subsections (i) and (j).
       (2) Medicare+choice.--Section 138 of such Code (relating to 
     Medicare+Choice MSA) is amended by striking subsection (f).
       (c) Reduction in High Deductible Plan Minimum Annual 
     Deductible.--
       (1) In general.--Subparagraph (A) of section 220(c)(2) of 
     such Code (defining high deductible health plan) is amended--
       (A) by striking ``$1,500'' and inserting ``$1,000'', and
       (B) by striking ``$3,000'' in clause (ii) and inserting 
     ``$2,000''.
       (2) Conforming amendment.--Subsection (g) of section 220 of 
     such Code is amended--
       (A) by striking ``1998'' and inserting ``1999''; and
       (B) by striking ``1997'' and inserting ``1998''.
       (d) Increase in Contribution Limit to 100 Percent of Annual 
     Deductible.--
       (1) In general.--Section 220(b)(2) of the Internal Revenue 
     Code of 1986 (relating to monthly limitation) is amended to 
     read as follows:
       ``(2) Monthly limitation.--The monthly limitation for any 
     month is the amount equal to \1/12\ of the annual deductible 
     of the high deductible health plan of the individual.''.
       (2) Conforming amendment.--Section 220(d)(1)(A) of such 
     Code is amended by striking ``75 percent of''.
       (e) Limitation on Additional Tax on Distributions Not Used 
     for Qualified Medical Expenses.--Section 220(f)(4) of the 
     Internal Revenue Code of 1986 (relating to additional tax on 
     distributions not used for qualified medical expenses) is 
     amended by adding at the end the following:
       ``(D) Exception in case of sufficient account balance.--
     Subparagraph (A) shall not apply to any payment or 
     distribution in any taxable year, but only to the extent such 
     payment or distribution does not reduce the fair market value 
     of the assets of the medical savings account to an amount 
     less than the annual deductible for the high deductible 
     health plan of the account holder (determined as of January 1 
     of the calendar year in which the taxable year begins).''.
       (f) Treatment of Network-Based Managed Care Plans.--Section 
     220(c)(2)(B) of the Internal Revenue Code of 1986 (relating 
     to special rules for high deductible health plans) is amended 
     by adding at the end the following:
       ``(iii) Treatment of network-based managed care plans.--A 
     plan that provides health care services through a network of 
     contracted or affiliated health care providers, if the 
     benefits provided when services are obtained through network 
     providers meet the requirements of subparagraph (A), shall 
     not fail to be treated as a high deductible health plan by 
     reason of providing benefits for services rendered by 
     providers who are not members of the network, so long as the 
     annual deductible and annual limit on out-of-pocket expenses 
     applicable to services received from non-network providers 
     are not lower than those applicable to services received from 
     the network providers.''.
       (g) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1999.

     SEC. 503. PERMITTING CONTRIBUTION TOWARDS MEDICAL SAVINGS 
                   ACCOUNT THROUGH FEDERAL EMPLOYEES HEALTH 
                   BENEFITS PROGRAM (FEHBP).

       (a) Authority To Contract for Catastrophic Plans.--Section 
     8902 of title 5, United States Code, is amended by adding at 
     the end the following:
       ``(p)(1) The Office shall contract under this chapter for a 
     catastrophic plan with any qualified carrier that--
       ``(A) offers such a plan; and
       ``(B) as of the date of enactment of the Patients' Bill of 
     Rights Plus Act, offers a health benefits plan under this 
     chapter.
       ``(2) The Office may contract under this chapter for a 
     catastrophic plan with any qualified carrier that--
       ``(A) offers such a plan; but
       ``(B) does not satisfy the requirement under paragraph 
     (1)(B).''.
       (b) Government Contribution to Medical Savings Account.--
       (1) In general.--Section 8906 of title 5, United States 
     Code, is amended by adding at the end the following:
       ``(j)(1) In the case of an employee or annuitant who is 
     enrolled in a catastrophic plan described by section 8903(5), 
     there shall be a Government contribution under this 
     subsection to a medical savings account established or 
     maintained for the benefit of the individual. The 
     contribution under this subsection shall be in addition to 
     the Government contribution under subsection (b).

[[Page S8764]]

       ``(2) The amount of the Government contribution under this 
     subsection with respect to an individual is equal to the 
     amount by which--
       ``(A) the maximum contribution allowed under subsection 
     (b)(1) with respect to any employee or annuitant, exceeds
       ``(B) the amount of the Government contribution actually 
     made with respect to the individual under subsection (b) for 
     coverage under the catastrophic plan.
       ``(3) The Government contributions under this subsection 
     shall be paid into a medical savings account (designated by 
     the individual involved) in a manner that is specified by the 
     Office and consistent with the timing of contributions under 
     subsection (b).
       ``(4) Subsections (f) and (g) shall apply to contributions 
     under this section in the same manner as they apply to 
     contributions under subsection (b).
       ``(5) For the purpose of this subsection, the term `medical 
     savings account' has the meaning given such term by section 
     220(d) of the Internal Revenue Code of 1986.''.
       (2) Allowing payment of full amount of charge for 
     catastrophic plan.--Section 8906(b)(2) of such title is 
     amended by inserting ``(or 100 percent of the subscription 
     charge in the case of a catastrophic plan)'' after ``75 
     percent of the subscription charge''.
       (c) Offering of Catastrophic Plans.--
       (1) In general.--Section 8903 of title 5, United States 
     Code, is amended by adding at the end the following:
       ``(5) Catastrophic plans.--(A) One or more plans described 
     in paragraph (1), (2), or (3), but which provide benefits of 
     the types referred to by paragraph (5) of section 8904(a), 
     instead of the types referred to in paragraphs (1), (2), and 
     (3) of such section.
       ``(B) Nothing in this section shall be considered--
       ``(i) to prevent a carrier from simultaneously offering a 
     plan described by subparagraph (A) and a plan described by 
     paragraph (1) or (2);
       ``(ii) to require that a catastrophic plan offer two levels 
     of benefits; or
       ``(iii) to allow, in any contract year, for--
       ``(I) more than one plan to be offered which satisfies both 
     subparagraph (A) and paragraph (1) (subject to clause (ii)); 
     and
       ``(II) more than one plan which satisfies both subparagraph 
     (A) and paragraph (2) (subject to clause (ii)).''.
       (2) Types of benefits.--Section 8904(a) of such title is 
     amended by inserting after paragraph (4) the following new 
     paragraph:
       ``(5) Catastrophic plans.--Benefits of the types named 
     under paragraph (1) or (2) of this subsection or both, except 
     that the plan shall meet the annual deductible and annual 
     out-of-pocket expenses requirements under section 220(c)(2) 
     of the Internal Revenue Code of 1986.''.
       (3) Determining level of government contributions.--Section 
     8906(b) of such title is amended by adding at the end the 
     following: ``Subscription charges for medical savings 
     accounts shall be deemed to be the amount of Government 
     contributions made under subsection (j)(2).''.
       (d) Conforming Amendments.--
       (1) Additional health benefits plans.--Section 8903a of 
     title 5, United States Code, is amended by redesignating 
     subsection (d) as subsection (e) and by inserting after 
     subsection (c) the following:
       ``(d) The plans under this section may include one or more 
     plans, otherwise allowable under this section, that satisfy 
     the requirements of clauses (i) and (ii) of section 
     8903(5)(A).''.
       (2) Reference.--Section 8909(d) of title 5, United States 
     Code, is amended by striking ``8903a(d)'' and inserting 
     ``8903a(e)''.
       (e) References.--Section 8903 of title 5, United States 
     Code, is amended by adding at the end (as a flush left 
     sentence) the following:
     ``The Office shall prescribe regulations under which the 
     requirements of section 8902(c), 8902(n), 8909(e), and any 
     other provision of this chapter that applies with respect to 
     a plan described by paragraph (1), (2), (3), or (4) of this 
     section shall apply with respect to the corresponding plan 
     under paragraph (5) of this section. Similar regulations 
     shall be prescribed with respect to any plan under section 
     8903a(d).''.
       (f) Effective Date.--The amendments made by this section 
     shall apply to contract terms beginning on or after January 
     1, 2000.

     SEC. 504. CARRYOVER OF UNUSED BENEFITS FROM CAFETERIA PLANS, 
                   FLEXIBLE SPENDING ARRANGEMENTS, AND HEALTH 
                   FLEXIBLE SPENDING ACCOUNTS.

       (a) In General.--Section 125 of the Internal Revenue Code 
     of 1986 (relating to cafeteria plans) is amended by 
     redesignating subsections (h) and (i) as subsections (i) and 
     (j) and by inserting after subsection (g) the following new 
     subsection:
       ``(h) Allowance of Carryovers of Unused Benefits to Later 
     Taxable Years.--
       ``(1) In general.--For purposes of this title--
       ``(A) notwithstanding subsection (d)(2), a plan or other 
     arrangement shall not fail to be treated as a cafeteria plan 
     or flexible spending or similar arrangement, and
       ``(B) no amount shall be required to be included in gross 
     income by reason of this section or any other provision of 
     this chapter,
     solely because under such plan or other arrangement any 
     nontaxable benefit which is unused as of the close of a 
     taxable year may be carried forward to 1 or more succeeding 
     taxable years.
       ``(2) Limitation.--Paragraph (1) shall not apply to amounts 
     carried from a plan to the extent such amounts exceed $500 
     (applied on an annual basis). For purposes of this paragraph, 
     all plans and arrangements maintained by an employer or any 
     related person shall be treated as 1 plan.
       ``(3) Allowance of rollover.--
       ``(A) In general.--In the case of any unused benefit 
     described in paragraph (1) which consists of amounts in a 
     health flexible spending account or dependent care flexible 
     spending account, the plan or arrangement shall provide that 
     a participant may elect, in lieu of such carryover, to have 
     such amounts distributed to the participant.
       ``(B) Amounts not included in income.--Any distribution 
     under subparagraph (A) shall not be included in gross income 
     to the extent that such amount is transferred in a trustee-
     to-trustee transfer, or is contributed within 60 days of the 
     date of the distribution, to--
       ``(i) a qualified cash or deferred arrangement described in 
     section 401(k),
       ``(ii) a plan under which amounts are contributed by an 
     individual's employer for an annuity contract described in 
     section 403(b),
       ``(iii) an eligible deferred compensation plan described in 
     section 457, or
       ``(iv) a medical savings account (within the meaning of 
     section 220).
     Any amount rolled over under this subparagraph shall be 
     treated as a rollover contribution for the taxable year from 
     which the unused amount would otherwise be carried.
       ``(C) Treatment of rollover.--Any amount rolled over under 
     subparagraph (B) shall be treated as an eligible rollover 
     under section 220, 401(k), 403(b), or 457, whichever is 
     applicable, and shall be taken into account in applying any 
     limitation (or participation requirement) on employer or 
     employee contributions under such section or any other 
     provision of this chapter for the taxable year of the 
     rollover.
       ``(4) Cost-of-living adjustment.--In the case of any 
     taxable year beginning in a calendar year after 1999, the 
     $500 amount under paragraph (2) shall be adjusted at the same 
     time and in the same manner as under section 415(d)(2), 
     except that the base period taken into account shall be the 
     calendar quarter beginning October 1, 1998, and any increase 
     which is not a multiple of $50 shall be rounded to the next 
     lowest multiple of $50.
       ``(5) Applicability.--This subsection shall apply to 
     taxable years beginning after December 31, 1999.''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1999.

       TITLE VI--PROVISIONS RELATING TO LONG-TERM CARE INSURANCE

     SEC. 601. INCLUSION OF QUALIFIED LONG-TERM CARE INSURANCE 
                   CONTRACTS IN CAFETERIA PLANS, FLEXIBLE SPENDING 
                   ARRANGEMENTS, AND HEALTH FLEXIBLE SPENDING 
                   ACCOUNTS.

       (a) In General.--Section 125(f) of the Internal Revenue 
     Code of 1986 (defining qualified benefits) is amended by 
     striking the last sentence and inserting the following: 
     ``Such term includes any qualified long-term care insurance 
     contract.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     1999.

     SEC. 602. DEDUCTION FOR PREMIUMS FOR LONG-TERM CARE 
                   INSURANCE.

       (a) In General.--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 222 
     as section 223 and by inserting after section 221 the 
     following:

     ``SEC. 222. PREMIUMS FOR LONG-TERM CARE INSURANCE.

       ``(a) In General.--In the case of an eligible individual, 
     there shall be allowed as a deduction an amount equal to 100 
     percent of the amount paid during the taxable year for any 
     coverage for qualified long-term care services (as defined in 
     section 7702B(c)) or any qualified long-term care insurance 
     contract (as defined in section 7702B(b)) which constitutes 
     medical care for the taxpayer, his spouse, and dependents.
       ``(b) Limitations.--
       ``(1) Deduction not available to individuals eligible for 
     employer-subsidized coverage.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     subsection (a) shall not apply to any taxpayer for any 
     calendar month for which the taxpayer is eligible to 
     participate in any plan which includes coverage for qualified 
     long-term care services (as so defined) or is a qualified 
     long-term care insurance contract (as so defined) maintained 
     by any employer (or former employer) of the taxpayer or of 
     the spouse of the taxpayer.
       ``(B) Continuation coverage.--Coverage shall not be treated 
     as subsidized for purposes of this paragraph if--
       ``(i) such coverage is continuation coverage (within the 
     meaning of section 4980B(f)) required to be provided by the 
     employer, and
       ``(ii) the taxpayer or the taxpayer's spouse is required to 
     pay a premium for such coverage in an amount not less than 
     100 percent of the applicable premium (within the meaning of 
     section 4980B(f)(4)) for the period of such coverage.
       ``(2) Limitation on long-term care premiums.--In the case 
     of a qualified long-term care insurance contract (as so 
     defined), only eligible long-term care premiums (as defined 
     in section 213(d)(10)) shall be taken into account under 
     subsection (a)(2).

[[Page S8765]]

       ``(c) Special Rules.--For purposes of this section--
       ``(1) Coordination with medical deduction, etc.--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 
     213(a).
       ``(2) Deduction not allowed for self-employment tax 
     purposes.--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.''.
       (b) Conforming Amendments.--
       (1) Subsection (a) of section 62 of the Internal Revenue 
     Code of 1986 is amended by inserting after paragraph (17) the 
     following:
       ``(18) Long-term care insurance costs of certain 
     individuals.--The deduction allowed by section 222.''.
       (2) The table of sections for part VII of subchapter B of 
     chapter 1 of such Code is amended by striking the last item 
     and inserting the following:

``Sec. 222. Premiums for long-term care insurance.
``Sec. 223. Cross reference.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1999.

     SEC. 603. STUDY OF LONG-TERM CARE NEEDS IN THE 21ST CENTURY.

       (a) In General.--The Secretary of Health and Human Services 
     (referred to in this section as the ``Secretary'') shall 
     provide, in accordance with this section, for a study in 
     order to determine--
       (1) future demand for long-term health care services 
     (including institutional and home and community-based 
     services) in the United States in order to meet the needs in 
     the 21st century; and
       (2) long-term options to finance the provision of such 
     services.
       (b) Details.--The study conducted under subsection (a) 
     shall include the following:
       (1) An identification of the relevant demographic 
     characteristics affecting demand for long-term health care 
     services, at least through the year 2030.
       (2) The viability and capacity of community-based and other 
     long-term health care services under different federal 
     programs, including through the medicare and medicaid 
     programs, grants to States, housing services, and changes in 
     tax policy.
       (3) How to improve the quality of long-term health care 
     services.
       (4) The integration of long-term health care services for 
     individuals between different classes of health care 
     providers (such as hospitals, nursing facilities, and home 
     care agencies) and different Federal programs (such as the 
     medicare and medicaid programs).
       (5) The possibility of expanding private sector 
     initiatives, including long-term care insurance, to meet the 
     need to finance such services.
       (6) An examination of the effect of enactment of the Health 
     Insurance Portability and Accountability Act of 1996 on the 
     provision and financing of long-term health care services, 
     including on portability and affordability of private long-
     term care insurance, the impact of insurance options on low-
     income older Americans, and the options for eligibility to 
     improve access to such insurance.
       (7) The financial impact of the provision of long-term 
     health care services on caregivers and other family members.
       (c) Report and Recommendations.--
       (1) In general.--Not later than 1 year after the date of 
     the enactment of this Act, the Secretary shall provide for a 
     report on the study under this section.
       (2) Recommendations.--The report under paragraph (1) shall 
     include findings and recommendations regarding each of the 
     following:
       (A) The most effective and efficient manner that the 
     Federal government may use its resources to educate the 
     public on planning for needs for long-term health care 
     services.
       (B) The public, private, and joint public-private 
     strategies for meeting identified needs for long-term health 
     care services.
       (C) The role of States and local communities in the 
     financing of long-term health care services.
       (3) Inclusion of cost estimates.--The report under 
     paragraph (1) shall include cost estimates of the various 
     options for which recommendations are made.
       (d) Conduct of Study.--
       (1) Use of institute of medicine.--The Secretary of Health 
     and Human Services shall seek to enter into an appropriate 
     arrangement with the Institute of Medicine of the National 
     Academy of Sciences to conduct the study under this section. 
     If such an arrangement cannot be made, the Secretary may 
     provide for the conduct of the study by any other qualified 
     non-governmental entity.
       (2) Consultation.--The study should be conducted under this 
     section in consultation with experts from a wide-range of 
     groups from the public and private sectors.

                 TITLE VII--INDIVIDUAL RETIREMENT PLANS

     SEC. 701. MODIFICATION OF INCOME LIMITS ON CONTRIBUTIONS AND 
                   ROLLOVERS TO ROTH IRAS.

       (a) Increase in AGI Limit for Rollover Contributions.--
     Clause (i) of section 408A(c)(3)(A) of the Internal Revenue 
     Code of 1986 (relating to rollover from IRA), as redesignated 
     by subsection (a), is amended by striking ``$100,000'' and 
     inserting ``$1,000,000''.
       (b) Conforming Amendments.--
       (1)(A) Subparagraph (B) of section 408A(c)(3) of the 
     Internal Revenue Code of 1986, as redesignated by subsection 
     (a), is amended to read as follows:
       ``(B) Definition of adjusted gross income.--For purposes of 
     subparagraph (A), adjusted gross income shall be determined--
       ``(i) after application of sections 86 and 469, and
       ``(ii) without regard to sections 135, 137, 221, and 911, 
     the deduction allowable under section 219, or any amount 
     included in gross income under subsection (d)(3).''.
       (B) Effective date.--The amendment made by this paragraph 
     shall apply to taxable years beginning after December 31, 
     1999.
       (2)(A) Subparagraph (B) of section 408A(c)(3) of such Code, 
     as amended by paragraph (1), is amended to read as follows:
       ``(B) Definition of adjusted gross income.--For purposes of 
     subparagraph (A), adjusted gross income shall be determined--
       ``(i) after application of sections 86 and 469, and
       ``(ii) without regard to sections 135, 137, 221, and 911, 
     the deduction allowable under section 219, or any amount 
     included in gross income under subsection (d)(3) or by reason 
     of a required distribution under a provision described in 
     paragraph (5).''.
       (B) Effective date.--The amendment made by this paragraph 
     shall apply to taxable years beginning after December 31, 
     2004.
       (c) Effective Date.--Except as otherwise provided in this 
     section, the amendments made by this section shall apply to 
     taxable years beginning after December 31, 1999.

                     TITLE VIII--REVENUE PROVISIONS

     SEC. 801. MODIFICATION TO FOREIGN TAX CREDIT CARRYBACK AND 
                   CARRYOVER PERIODS.

       (a) In General.--Section 904(c) of the Internal Revenue 
     Code of 1986 (relating to limitation on credit) is amended--
       (1) by striking ``in the second preceding taxable year,'', 
     and
       (2) by striking ``or fifth'' and inserting ``fifth, sixth, 
     or seventh''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to credits arising in taxable years beginning 
     after December 31, 2001.

     SEC. 802. LIMITATION ON USE OF NON-ACCRUAL EXPERIENCE METHOD 
                   OF ACCOUNTING.

       (a) In General.--Section 448(d)(5) of the Internal Revenue 
     Code of 1986 (relating to special rule for services) is 
     amended--
       (1) by inserting ``in fields described in paragraph 
     (2)(A)'' after ``services by such person'', and
       (2) by inserting ``certain personal'' before ``services'' 
     in the heading.
       (b) Effective Date.--
       (1) In general.--The amendments made by this section shall 
     apply to taxable years ending after the date of the enactment 
     of this Act.
       (2) Change in method of accounting.--In the case of any 
     taxpayer required by the amendments made by this section to 
     change its method of accounting for its first taxable year 
     ending after the date of the enactment of this Act--
       (A) such change shall be treated as initiated by the 
     taxpayer,
       (B) such change shall be treated as made with the consent 
     of the Secretary of the Treasury, and
       (C) the net amount of the adjustments required to be taken 
     into account by the taxpayer under section 481 of the 
     Internal Revenue Code of 1986 shall be taken into account 
     over a period (not greater than 4 taxable years) beginning 
     with such first taxable year.

     SEC. 803. RETURNS RELATING TO CANCELLATIONS OF INDEBTEDNESS 
                   BY ORGANIZATIONS LENDING MONEY.

       (a) In General.--Paragraph (2) of section 6050P(c) of the 
     Internal Revenue Code of 1986 (relating to definitions and 
     special rules) is amended by striking ``and'' at the end of 
     subparagraph (B), by striking the period at the end of 
     subparagraph (C) and inserting ``, and'', and by inserting 
     after subparagraph (C) the following new subparagraph:
       ``(D) any organization a significant trade or business of 
     which is the lending of money.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to discharges of indebtedness after December 31, 
     1999.

     SEC. 804. EXTENSION OF INTERNAL REVENUE SERVICE USER FEES.

       (a) In General.--Chapter 77 of the Internal Revenue Code of 
     1986 (relating to miscellaneous provisions) is amended by 
     adding at the end the following new section:

     ``SEC. 7527. INTERNAL REVENUE SERVICE USER FEES.

       ``(a) General Rule.--The Secretary shall establish a 
     program requiring the payment of user fees for--
       ``(1) requests to the Internal Revenue Service for ruling 
     letters, opinion letters, and determination letters, and
       ``(2) other similar requests.
       ``(b) Program Criteria.--
       ``(1) In general.--The fees charged under the program 
     required by subsection (a)--
       ``(A) shall vary according to categories (or subcategories) 
     established by the Secretary,

[[Page S8766]]

       ``(B) shall be determined after taking into account the 
     average time for (and difficulty of) complying with requests 
     in each category (and subcategory), and
       ``(C) shall be payable in advance.
       ``(2) Exemptions, etc.--The Secretary shall provide for 
     such exemptions (and reduced fees) under such program as the 
     Secretary determines to be appropriate.
       ``(3) Average fee requirement.--The average fee charged 
     under the program required by subsection (a) shall not be 
     less than the amount determined under the following table:

``Category                                                  Average Fee
  Employee plan ruling and opinion............................$250 ....

  Exempt organization ruling..................................$350 ....

  Employee plan determination.................................$300 ....

  Exempt organization determination...........................$275 ....

  Chief counsel ruling........................................$200.....

       ``(c) Termination.--No fee shall be imposed under this 
     section with respect to requests made after September 30, 
     2009.''.
       (b) Conforming Amendments.--
       (1) The table of sections for chapter 77 of the Internal 
     Revenue Code of 1986 is amended by adding at the end the 
     following new item:

``Sec. 7527. Internal Revenue Service user fees.''.
       (2) Section 10511 of the Revenue Act of 1987 is repealed.
       (c) Effective Date.--The amendments made by this section 
     shall apply to requests made after the date of the enactment 
     of this Act.

     SEC. 805. PROPERTY SUBJECT TO A LIABILITY TREATED IN SAME 
                   MANNER AS ASSUMPTION OF LIABILITY.

       (a) Repeal of Property Subject to a Liability Test.--
       (1) Section 357.--Section 357(a)(2) of the Internal Revenue 
     Code of 1986 (relating to assumption of liability) is amended 
     by striking ``, or acquires from the taxpayer property 
     subject to a liability''.
       (2) Section 358.--Section 358(d)(1) of such Code (relating 
     to assumption of liability) is amended by striking ``or 
     acquired from the taxpayer property subject to a liability''.
       (3) Section 368.--
       (A) Section 368(a)(1)(C) of such Code is amended by 
     striking ``, or the fact that property acquired is subject to 
     a liability,''.
       (B) The last sentence of section 368(a)(2)(B) of such Code 
     is amended by striking ``, and the amount of any liability to 
     which any property acquired from the acquiring corporation is 
     subject,''.
       (b) Clarification of Assumption of Liability.--
       (1) In general.--Section 357 of the Internal Revenue Code 
     of 1986 is amended by adding at the end the following new 
     subsection:
       ``(d) Determination of Amount of Liability Assumed.--
       ``(1) In general.--For purposes of this section, section 
     358(d), section 362(d), section 368(a)(1)(C), and section 
     368(a)(2)(B), except as provided in regulations--
       ``(A) a recourse liability (or portion thereof) shall be 
     treated as having been assumed if, as determined on the basis 
     of all facts and circumstances, the transferee has agreed to, 
     and is expected to, satisfy such liability (or portion), 
     whether or not the transferor has been relieved of such 
     liability, and
       ``(B) except to the extent provided in paragraph (2), a 
     nonrecourse liability shall be treated as having been assumed 
     by the transferee of any asset subject to such liability.
       ``(2) Exception for nonrecourse liability.--The amount of 
     the nonrecourse liability treated as described in paragraph 
     (1)(B) shall be reduced by the lesser of--
       ``(A) the amount of such liability which an owner of other 
     assets not transferred to the transferee and also subject to 
     such liability has agreed with the transferee to, and is 
     expected to, satisfy, or
       ``(B) the fair market value of such other assets 
     (determined without regard to section 7701(g)).
       ``(3) Regulations.--The Secretary shall prescribe such 
     regulations as may be necessary to carry out the purposes of 
     this subsection and section 362(d). The Secretary may also 
     prescribe regulations which provide that the manner in which 
     a liability is treated as assumed under this subsection is 
     applied, where appropriate, elsewhere in this title.''.
       (2) Limitation on basis increase attributable to assumption 
     of liability.--Section 362 of such Code is amended by adding 
     at the end the following new subsection:
       ``(d) Limitation on Basis Increase Attributable to 
     Assumption of Liability.--
       ``(1) In general.--In no event shall the basis of any 
     property be increased under subsection (a) or (b) above the 
     fair market value of such property (determined without regard 
     to section 7701(g)) by reason of any gain recognized to the 
     transferor as a result of the assumption of a liability.
       ``(2) Treatment of gain not subject to tax.--Except as 
     provided in regulations, if--
       ``(A) gain is recognized to the transferor as a result of 
     an assumption of a nonrecourse liability by a transferee 
     which is also secured by assets not transferred to such 
     transferee, and
       ``(B) no person is subject to tax under this title on such 
     gain,
     then, for purposes of determining basis under subsections (a) 
     and (b), the amount of gain recognized by the transferor as a 
     result of the assumption of the liability shall be determined 
     as if the liability assumed by the transferee equaled such 
     transferee's ratable portion of such liability determined on 
     the basis of the relative fair market values (determined 
     without regard to section 7701(g)) of all of the assets 
     subject to such liability.''.
       (c) Application to Provisions Other Than Subchapter C.--
       (1) Section 584.--Section 584(h)(3) of the Internal Revenue 
     Code of 1986 is amended--
       (A) by striking ``, and the fact that any property 
     transferred by the common trust fund is subject to a 
     liability,'' in subparagraph (A), and
       (B) by striking clause (ii) of subparagraph (B) and 
     inserting:
       ``(ii) Assumed liabilities.--For purposes of clause (i), 
     the term `assumed liabilities' means any liability of the 
     common trust fund assumed by any regulated investment company 
     in connection with the transfer referred to in paragraph 
     (1)(A).
       ``(C) Assumption.--For purposes of this paragraph, in 
     determining the amount of any liability assumed, the rules of 
     section 357(d) shall apply.''.
       (2) Section 1031.--The last sentence of section 1031(d) of 
     such Code is amended--
       (A) by striking ``assumed a liability of the taxpayer or 
     acquired from the taxpayer property subject to a liability'' 
     and inserting ``assumed (as determined under section 357(d)) 
     a liability of the taxpayer'', and
       (B) by striking ``or acquisition (in the amount of the 
     liability)''.
       (d) Conforming Amendments.--
       (1) Section 351(h)(1) of the Internal Revenue Code of 1986 
     is amended by striking ``, or acquires property subject to a 
     liability,''.
       (2) Section 357 of such Code is amended by striking ``or 
     acquisition'' each place it appears in subsection (a) or (b).
       (3) Section 357(b)(1) of such Code is amended by striking 
     ``or acquired''.
       (4) Section 357(c)(1) of such Code is amended by striking 
     ``, plus the amount of the liabilities to which the property 
     is subject,''.
       (5) Section 357(c)(3) of such Code is amended by striking 
     ``or to which the property transferred is subject''.
       (6) Section 358(d)(1) of such Code is amended by striking 
     ``or acquisition (in the amount of the liability)''.
       (e) Effective Date.--The amendments made by this section 
     shall apply to transfers after October 19, 1998.

     SEC. 806. CHARITABLE SPLIT-DOLLAR LIFE INSURANCE, ANNUITY, 
                   AND ENDOWMENT CONTRACTS.

       (a) In General.--Subsection (f) of section 170 of the 
     Internal Revenue Code of 1986 (relating to disallowance of 
     deduction in certain cases and special rules) is amended by 
     adding at the end the following new paragraph:
       ``(10) Split-dollar life insurance, annuity, and endowment 
     contracts.--
       ``(A) In general.--Nothing in this section or in section 
     545(b)(2), 556(b)(2), 642(c), 2055, 2106(a)(2), or 2522 shall 
     be construed to allow a deduction, and no deduction shall be 
     allowed, for any transfer to or for the use of an 
     organization described in subsection (c) if in connection 
     with such transfer--
       ``(i) the organization directly or indirectly pays, or has 
     previously paid, any premium on any personal benefit contract 
     with respect to the transferor, or
       ``(ii) there is an understanding or expectation that any 
     person will directly or indirectly pay any premium on any 
     personal benefit contract with respect to the transferor.
       ``(B) Personal benefit contract.--For purposes of 
     subparagraph (A), the term `personal benefit contract' means, 
     with respect to the transferor, any life insurance, annuity, 
     or endowment contract if any direct or indirect beneficiary 
     under such contract is the transferor, any member of the 
     transferor's family, or any other person (other than an 
     organization described in subsection (c)) designated by the 
     transferor.
       ``(C) Application to charitable remainder trusts.--In the 
     case of a transfer to a trust referred to in subparagraph 
     (E), references in subparagraphs (A) and (F) to an 
     organization described in subsection (c) shall be treated as 
     a reference to such trust.
       ``(D) Exception for certain annuity contracts.--If, in 
     connection with a transfer to or for the use of an 
     organization described in subsection (c), such organization 
     incurs an obligation to pay a charitable gift annuity (as 
     defined in section 501(m)) and such organization purchases 
     any annuity contract to fund such obligation, persons 
     receiving payments under the charitable gift annuity shall 
     not be treated for purposes of subparagraph (B) as indirect 
     beneficiaries under such contract if--
       ``(i) such organization possesses all of the incidents of 
     ownership under such contract,
       ``(ii) such organization is entitled to all the payments 
     under such contract, and
       ``(iii) the timing and amount of payments under such 
     contract are substantially the same as the timing and amount 
     of payments to each such person under such obligation (as 
     such obligation is in effect at the time of such transfer).
       ``(E) Exception for certain contracts held by charitable 
     remainder trusts.--A person shall not be treated for purposes 
     of subparagraph (B) as an indirect beneficiary under any life 
     insurance, annuity, or endowment contract held by a 
     charitable remainder annuity trust or a charitable remainder 
     unitrust (as defined in section 664(d)) solely by reason of 
     being entitled to any payment referred to in paragraph (1)(A) 
     or (2)(A) of section 664(d) if--
       ``(i) such trust possesses all of the incidents of 
     ownership under such contract, and

[[Page S8767]]

       ``(ii) such trust is entitled to all the payments under 
     such contract.
       ``(F) Excise tax on premiums paid.--
       ``(i) In general.--There is hereby imposed on any 
     organization described in subsection (c) an excise tax equal 
     to the premiums paid by such organization on any life 
     insurance, annuity, or endowment contract if the payment of 
     premiums on such contract is in connection with a transfer 
     for which a deduction is not allowable under subparagraph 
     (A), determined without regard to when such transfer is made.
       ``(ii) Payments by other persons.--For purposes of clause 
     (i), payments made by any other person pursuant to an 
     understanding or expectation referred to in subparagraph (A) 
     shall be treated as made by the organization.
       ``(iii) Reporting.--Any organization on which tax is 
     imposed by clause (i) with respect to any premium shall file 
     an annual return which includes--

       ``(I) the amount of such premiums paid during the year and 
     the name and TIN of each beneficiary under the contract to 
     which the premium relates, and
       ``(II) such other information as the Secretary may require.

     The penalties applicable to returns required under section 
     6033 shall apply to returns required under this clause. 
     Returns required under this clause shall be furnished at such 
     time and in such manner as the Secretary shall by forms or 
     regulations require.
       ``(iv) Certain rules to apply.--The tax imposed by this 
     subparagraph shall be treated as imposed by chapter 42 for 
     purposes of this title other than subchapter B of chapter 42.
       ``(G) Special rule where state requires specification of 
     charitable gift annuitant in contract.--In the case of an 
     obligation to pay a charitable gift annuity referred to in 
     subparagraph (D) which is entered into under the laws of a 
     State which requires, in order for the charitable gift 
     annuity to be exempt from insurance regulation by such State, 
     that each beneficiary under the charitable gift annuity be 
     named as a beneficiary under an annuity contract issued by an 
     insurance company authorized to transact business in such 
     State, the requirements of clauses (i) and (ii) of 
     subparagraph (D) shall be treated as met if--
       ``(i) such State law requirement was in effect on February 
     8, 1999,
       ``(ii) each such beneficiary under the charitable gift 
     annuity is a bona fide resident of such State at the time the 
     obligation to pay a charitable gift annuity is entered into, 
     and
       ``(iii) the only persons entitled to payments under such 
     contract are persons entitled to payments as beneficiaries 
     under such obligation on the date such obligation is entered 
     into.
       ``(H) Regulations.--The Secretary shall prescribe such 
     regulations as may be necessary or appropriate to carry out 
     the purposes of this paragraph, including regulations to 
     prevent the avoidance of such purposes.''.
       (b) Effective Date.--
       (1) In general.--Except as otherwise provided in this 
     section, the amendment made by this section shall apply to 
     transfers made after February 8, 1999.
       (2) Excise tax.--Except as provided in paragraph (3) of 
     this subsection, section 170(f)(10)(F) of the Internal 
     Revenue Code of 1986 (as added by this section) shall apply 
     to premiums paid after the date of the enactment of this Act.
       (3) Reporting.--Clause (iii) of such section 170(f)(10)(F) 
     shall apply to premiums paid after February 8, 1999 
     (determined as if the tax imposed by such section applies to 
     premiums paid after such date).

     SEC. 807. TRANSFER OF EXCESS DEFINED BENEFIT PLAN ASSETS FOR 
                   RETIREE HEALTH BENEFITS.

       (a) Extension.--
       (1) In general.--Section 420(b)(5) of the Internal Revenue 
     Code of 1986 (relating to expiration) is amended by striking 
     ``in any taxable year beginning after December 31, 2000'' and 
     inserting ``made after September 30, 2009''.
       (2) Conforming amendments.--
       (A) Section 101(e)(3) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1021(e)(3)) is amended by 
     striking ``1995'' and inserting ``2001''.
       (B) Section 403(c)(1) of such Act (29 U.S.C. 1103(c)(1)) is 
     amended by striking ``1995'' and inserting ``2001''.
       (C) Paragraph (13) of section 408(b) of such Act (29 U.S.C. 
     1108(b)(13)) is amended--
       (i) by striking ``in a taxable year beginning before 
     January 1, 2001'' and inserting ``made before October 1, 
     2009'', and
       (ii) by striking ``1995'' and inserting ``2001''.
       (b) Application of Minimum Cost Requirements.--
       (1) In general.--Section 420(c)(3) of the Internal Revenue 
     Code of 1986 is amended to read as follows:
       ``(3) Minimum cost requirements.--
       ``(A) In general.--The requirements of this paragraph are 
     met if each group health plan or arrangement under which 
     applicable health benefits are provided provides that the 
     applicable employer cost for each taxable year during the 
     cost maintenance period shall not be less than the higher of 
     the applicable employer costs for each of the 2 taxable years 
     immediately preceding the taxable year of the qualified 
     transfer.
       ``(B) Applicable employer cost.--For purposes of this 
     paragraph, the term `applicable employer cost' means, with 
     respect to any taxable year, the amount determined by 
     dividing--
       ``(i) the qualified current retiree health liabilities of 
     the employer for such taxable year determined--

       ``(I) without regard to any reduction under subsection 
     (e)(1)(B), and
       ``(II) in the case of a taxable year in which there was no 
     qualified transfer, in the same manner as if there had been 
     such a transfer at the end of the taxable year, by

       ``(ii) the number of individuals to whom coverage for 
     applicable health benefits was provided during such taxable 
     year.
       ``(C) Election to compute cost separately.--An employer may 
     elect to have this paragraph applied separately with respect 
     to individuals eligible for benefits under title XVIII of the 
     Social Security Act at any time during the taxable year and 
     with respect to individuals not so eligible.
       ``(D) Cost maintenance period.--For purposes of this 
     paragraph, the term `cost maintenance period' means the 
     period of 5 taxable years beginning with the taxable year in 
     which the qualified transfer occurs. If a taxable year is in 
     2 or more overlapping cost maintenance periods, this 
     paragraph shall be applied by taking into account the highest 
     applicable employer cost required to be provided under 
     subparagraph (A) for such taxable year.''.
       (2) Conforming amendments.--
       (A) Section 420(b)(1)(C)(iii) of such Code is amended by 
     striking ``benefits'' and inserting ``cost''.
       (B) Section 420(e)(1)(D) of such Code is amended by 
     striking ``and shall not be subject to the minimum benefit 
     requirements of subsection (c)(3)'' and inserting ``or in 
     calculating applicable employer cost under subsection 
     (c)(3)(B)''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to qualified transfers occurring after December 
     31, 2000, and before October 1, 2009.

     SEC. 808. LIMITATIONS ON WELFARE BENEFIT FUNDS OF 10 OR MORE 
                   EMPLOYER PLANS.

       (a) Benefits to Which Exception Applies.--Section 
     419A(f)(6)(A) of the Internal Revenue Code of 1986 (relating 
     to exception for 10 or more employer plans) is amended to 
     read as follows:
       ``(A) In general.--This subpart shall not apply to a 
     welfare benefit fund which is part of a 10 or more employer 
     plan if the only benefits provided through the fund are 1 or 
     more of the following:
       ``(i) Medical benefits.
       ``(ii) Disability benefits.
       ``(iii) Group term life insurance benefits which do not 
     provide for any cash surrender value or other money that can 
     be paid, assigned, borrowed, or pledged for collateral for a 
     loan.
     The preceding sentence shall not apply to any plan which 
     maintains experience-rating arrangements with respect to 
     individual employers.''.
       (b) Limitation on Use of Amounts for Other Purposes.--
     Section 4976(b) of the Internal Revenue Code of 1986 
     (defining disqualified benefit) is amended by adding at the 
     end the following new paragraph:
       ``(5) Special rule for 10 or more employer plans exempted 
     from prefunding limits.--For purposes of paragraph (1)(C), 
     if--
       ``(A) subpart D of part I of subchapter D of chapter 1 does 
     not apply by reason of section 419A(f)(6) to contributions to 
     provide 1 or more welfare benefits through a welfare benefit 
     fund under a 10 or more employer plan, and
       ``(B) any portion of the welfare benefit fund attributable 
     to such contributions is used for a purpose other than that 
     for which the contributions were made,
     then such portion shall be treated as reverting to the 
     benefit of the employers maintaining the fund.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to contributions paid or accrued after the date 
     of the enactment of this Act, in taxable years ending after 
     such date.

     SEC. 809. MODIFICATION OF INSTALLMENT METHOD AND REPEAL OF 
                   INSTALLMENT METHOD FOR ACCRUAL METHOD 
                   TAXPAYERS.

       (a) Repeal of Installment Method for Accrual Basis 
     Taxpayers.--
       (1) In general.--Subsection (a) of section 453 of the 
     Internal Revenue Code of 1986 (relating to installment 
     method) is amended to read as follows:
       ``(a) Use of Installment Method.--
       ``(1) In general.--Except as otherwise provided in this 
     section, income from an installment sale shall be taken into 
     account for purposes of this title under the installment 
     method.
       ``(2) Accrual method taxpayer.--The installment method 
     shall not apply to income from an installment sale if such 
     income would be reported under an accrual method of 
     accounting without regard to this section. The preceding 
     sentence shall not apply to a disposition described in 
     subparagraph (A) or (B) of subsection (l)(2).''.
       (2) Conforming amendments.--Sections 453(d)(1), 453(i)(1), 
     and 453(k) of such Code are each amended by striking ``(a)'' 
     each place it appears and inserting ``(a)(1)''.
       (b) Modification of Pledge Rules.--Paragraph (4) of section 
     453A(d) of the Internal Revenue Code of 1986 (relating to 
     pledges, etc., of installment obligations) is amended by 
     adding at the end the following: ``A payment shall be treated 
     as directly secured by an interest in an installment 
     obligation to

[[Page S8768]]

     the extent an arrangement allows the taxpayer to satisfy all 
     or a portion of the indebtedness with the installment 
     obligation.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to sales or other dispositions occurring on or 
     after the date of the enactment of this Act.

     SEC. 810. INCLUSION OF CERTAIN VACCINES AGAINST STREPTOCOCCUS 
                   PNEUMONIAE TO LIST OF TAXABLE VACCINES.

       (a) In General.--Section 4132(a)(1) of the Internal Revenue 
     Code of 1986 (defining taxable vaccine) is amended by adding 
     at the end the following new subparagraph:
       ``(L) Any conjugate vaccine against streptococcus 
     pneumoniae.''.
       (b) Effective Date.--
       (1) Sales.--The amendment made by this section shall apply 
     to vaccine sales beginning on the day after the date on which 
     the Centers for Disease Control makes a final recommendation 
     for routine administration to children of any conjugate 
     vaccine against streptococcus pneumoniae.
       (2) Deliveries.--For purposes of paragraph (1), in the case 
     of sales on or before the date described in such paragraph 
     for which delivery is made after such date, the delivery date 
     shall be considered the sale date.

                   TITLE IX--MISCELLANEOUS PROVISIONS

     SEC. 901. MEDICARE COMPETITIVE PRICING DEMONSTRATION PROJECT.

       (a) Finding.--The Senate finds that implementing 
     competitive pricing in the medicare program under title XVIII 
     of the Social Security Act is an important goal.
       (b) Prohibition on Implementation of Project in Certain 
     Areas.--Notwithstanding subsection (b) of section 4011 of the 
     Balanced Budget Act of 1997 (Public Law 105-33)), the 
     Secretary of Health and Human Services may not implement the 
     Medicare Competitive Pricing Demonstration Project (operated 
     by the Secretary of Health and Human Services pursuant to 
     such section) in Kansas City, Missouri or Kansas City, 
     Kansas, or in any area in Arizona.
       (c) Moratorium on Implementation of Project in any Area 
     until January, 1, 2001.--Notwithstanding any provision of 
     section 4011 of the Balanced Budget Act of 1997 (Public Law 
     105-33)), the Secretary of Health and Human Services may not 
     implement the Medicare Competitive Pricing Demonstration 
     Project in any area before January 1, 2001.
       (d) Study and Report to Congress.--
       (1) Study.--The Secretary of Health and Human Services, in 
     conjunction with the Competitive Pricing Advisory Committee, 
     shall conduct a study on the different approaches of 
     implementing the Medicare Competitive Pricing Demonstration 
     Project on a voluntary basis.
       (2) Report.--Not later than June 30, 2000, the Secretary of 
     Health and Human Services shall submit a report to Congress 
     which shall contain a detailed description of the study 
     conducted under paragraph (1), together with the 
     recommendations of the Secretary and the Competitive Pricing 
     Advisory Committee regarding the implementation of the 
     Medicare Competitive Pricing Demonstration Project.
  Mr. DOMENICI addressed the Chair.
  The PRESIDING OFFICER. The Senator from New Mexico, under a previous 
order, is recognized for up to 10 minutes.

                          ____________________