[House Report 118-258]
[From the U.S. Government Publishing Office]
118th Congress } { Report
HOUSE OF REPRESENTATIVES
1st Session } { 118-258
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TRANSPARENCY IN BILLING ACT OF 2023
_______
November 1, 2023.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Ms. Foxx, from the Committee on Education and the Workforce, submitted
the following
R E P O R T
[To accompany H.R. 4509]
The Committee on Education and the Workforce, to whom was
referred the bill (H.R. 4509) to amend the Employee Retirement
Income Security Act of 1974 to require group health plans and
health insurance issuers offering group health insurance
coverage to only pay claims submitted by hospitals that have in
place policies and procedures to ensure accurate billing
practices, and for other purposes, having considered the same,
reports favorably thereon with an amendment and recommends that
the bill as amended do pass.
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Transparency in Billing Act of 2023''.
SEC. 2. HONEST BILLING REQUIREMENTS.
(a) 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 new section:
``SEC. 726. HONEST BILLING REQUIREMENTS.
``A group health plan or health insurance issuer offering group
health insurance coverage may not pay a claim for items and services
furnished to an individual at an off-campus outpatient department of a
provider (as defined in section 901(c)) submitted by a hospital (as
defined in section 1861(e) of the Social Security Act) unless such
claim submitted by such hospital includes the separate unique health
identifier for the department where items and services were furnished,
in accordance with section 901.''.
(b) Clerical Amendment.--The table of contents of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1001 note) is amended
by adding after the item relating to section 725 the following:
``Sec. 726. Honest billing requirements.''.
(c) Effective Date.--The amendments made by this section shall take
effect with respect to plan years beginning on or after January 1,
2024.
SEC. 3. REGULATION OF HONEST BILLING.
(a) In General.--Subtitle B of title I of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1021 et seq.) is amended by
adding at the end the following new part:
``PART 9--BILLING REQUIREMENTS WITH RESPECT TO GROUP HEALTH PLANS AND
COVERAGE
``SEC. 901. HONEST BILLING REQUIREMENTS.
``(a) In General.--A hospital may not, with respect to items and
services furnished to an individual at an off-campus outpatient
department of a provider, submit a claim for such items and services to
a group health plan or health insurance issuer, and may not hold such
individual liable for such items and services, unless--
``(1) such hospital obtains a separate unique health
identifier established for such department pursuant to section
1173(b) of the Social Security Act; and
``(2) the claim for such items and services includes such
separate unique health identifier for such department where
such items and services were furnished.
``(b) Process for Reporting Suspected Violations.--Not later than one
year after the date of enactment of this section, the Secretary shall
establish a process under which a suspected violation of this section
may be reported to such Secretary.
``(c) Off-campus Outpatient Department of a Provider Defined.--For
purposes of this paragraph, the term `off-campus outpatient department
of a provider' means a department of a provider (as defined in section
413.65 of title 42, Code of Federal Regulations, or any successor
regulation) that is not located--
``(1) on the campus (as defined in such section) of such
provider; or
``(2) within the distance (described in such definition of
campus) from a remote location of a hospital facility (as
defined in such section).''.
(b) Clerical Amendment.--The table of contents of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1001 note) is amended
by inserting after the item relating to section 804 the following new
item:
``Part 9--Billing Requirements With Respect to Group Health Plans and
Coverage
``Sec. 901. Honest billing requirements.''.
SEC. 4. ENFORCEMENT.
Section 502 of the Employee Retirement Income Security Act of 1974
(29 U.S.C. 1132) is amended--
(1) in subsection (a)(6), by striking ``or (9)'' and
inserting ``(9), or (13)''; and
(2) in subsection (c), by adding at the end the following new
paragraph:
``(13) The Secretary may assess a civil monetary penalty
against a hospital for a violation under section 901 in an
amount--
``(A) in the case of a hospital with not more than 30
beds (as determined under section 180.90(c)(2)(ii)(D)
of title 45, Code of Federal Regulations, as in effect
on the date of the enactment of this paragraph), not to
exceed $300 per day that the violation is ongoing, as
determined by the Secretary; and
``(B) in the case of a hospital with more than 30
beds (as so determined), not to exceed $5,500 per each
such day.''.
SEC. 5. IMPLEMENTATION.
The Secretary of Labor shall implement the amendments made by this
Act by rulemaking.
Purpose
The hospital industry is the largest contributor to
national health expenditures, accounting for nearly one of
every three dollars spent on health care in the United
States.\1\ In addition, perverse economic incentives in health
care have fueled provider consolidation, creating upward
pressure on health care costs.
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\1\https://www.cms.gov/files/document/highlights.pdf.
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H.R. 4509, the Transparency in Billing Act, amends the
Employee Retirement Income Security Act of 1974 (ERISA)\2\ to
require group health plans and health insurance issuers
offering group health insurance coverage only to pay claims
submitted by hospitals that have in place policies and
procedures to ensure accurate billing practices. This
legislation includes commonsense provisions to ensure that
group health plans only pay for services that are appropriately
billed for the correct site of service, and it prevents
hospitals from obscuring the true site of service in order to
charge higher prices via facility fees or other charges.
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\2\29 U.S.C. Sec. 1001 et seq.
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Committee Action
116TH CONGRESS
Subcommittee Hearing on Examining Surprise Billing: Protecting Patients
from Financial Pain
On April 2, 2019, the Subcommittee on Health, Employment,
Labor, and Pensions (HELP) held a hearing entitled ``Examining
Surprise Billing: Protecting Patients from Financial Pain,''
which discussed provider billing practices, including
unexpected costs to consumers due, in part, to a lack of
transparency. Witnesses further discussed the impact that
increased transparency could have on boosting competition in
health care. The witnesses were Ms. Ilyse Schuman, Senior Vice
President, Health Policy, American Benefits Council,
Washington, D.C.; Dr. Jack Hoadley, Research Professor
Emeritus, Health Policy Institute, Georgetown University
McCourt School of Public Policy, McLean, VA; Mr. Frederick
Isasi, Executive Director, Families USA, Washington, D.C.; and
Ms. Christen Linke Young, Fellow, USC-Brookings Schaeffer
Initiative on Health Policy, Washington, D.C.
Full Committee Markup of H.R. 5800, the Ban Surprise Billing Act
On February 11, 2020, the Committee met to mark up H.R.
5800, the Ban Surprise Billing Act, introduced by then-Chairman
Robert C. ``Bobby'' Scott (D-VA-3) and then-Ranking Member
Virginia Foxx (R-NC-5). The legislation protected participants
in employer-provided health plans from exorbitant out-of-
network costs and included provisions improving transparency
with respect to group health plan service providers, including
those providing brokerage and consulting services. The
Committee favorably reported the bill by a vote of 32 yeas and
13 nays.
118TH CONGRESS
Subcommittee Hearing on Reducing Health Care Costs for Working
Americans and Their Families
On April 26, 2023, the HELP Subcommittee held a hearing
entitled ``Reducing Health Care Costs for Working Americans and
Their Families,'' which examined challenges facing employer-
sponsored health coverage, including the need for increased
transparency in health care, addressing dishonest hospital
billing practices, and lowering costs by expanding oversight of
pharmacy benefit managers (PBMs). The witnesses were Mr. Joel
White, President, Council for Affordable Health Coverage,
Washington, D.C.; Mrs. Tracy Watts, Senior Partner, Mercer,
Washington, D.C.; Ms. Marcie Strouse, Partner, Capitol Benefits
Group, Des Moines, Iowa; and Ms. Sabrina Corlette, J.D.,
Research Professor and Co-Director, Center on Health Insurance
Reforms, Georgetown University McCourt School of Public Policy,
Washington, D.C.
Subcommittee Hearing on Competition and Transparency: The Pathway
Forward for a Stronger Health Care Market
On June 21, 2023, the HELP Subcommittee held a hearing
entitled ``Competition and Transparency: The Pathway Forward
for a Stronger Health Care Market,'' which examined the need to
improve competition and transparency in health care through
honest billing practices, improving transparency rules, and
addressing the role of PBMs in the health care market. The
witnesses were Dr. Gloria Sachdev, President and CEO,
Employers' Forum of Indiana, Carmel, Indiana; Ms. Sophia
Tripoli, Senior Director of Health Policy and Director of the
Center for Affordable Whole-Person Care, Families USA,
Washington, D.C.; Mr. Greg Baker, CEO, AffirmedRx, Louisville,
Kentucky; Ms. Christine Monahan, Assistant Research Professor,
Center on Health Insurance Reforms, Georgetown University
McCourt School of Public Policy, Washington, D.C.; and Mr. Juan
Carlos ``JC'' Scott, President and CEO, Pharmaceutical Care
Management Association, Washington, D.C.
Full Committee Markup of H.R. 4509, the Transparency in Billing Act
On July 10, 2023, Chairwoman Foxx and Ranking Member Scott
introduced H.R. 4509, the Transparency in Billing Act. On July
12, 2023, the Committee met to mark up H.R. 4509 and adopted an
Amendment in the Nature of a Substitute offered by Rep. Aaron
Bean (R-FL-4), which made technical changes to H.R. 4509. The
Committee reported the bill favorably, as amended, to the House
of Representatives by a vote of 39 yeas and 0 nays.
Committee Views
INTRODUCTION
Competition can drive innovation, improve quality, and
lower prices. Unfortunately, the health care system has become
increasingly consolidated in recent decades. Three PBM
companies control nearly 90 percent of the market;\3\ health
plans are becoming vertically integrated and purchasing primary
and specialty care offices;\4\ and hospitals are consolidating
at a rapid rate. From 1998 to 2015, 1,412 hospitals merged,\5\
and 90 percent of metropolitan statistical areas are considered
consolidated for hospital services.\6\ The percentage of
physicians' practices that are owned by or affiliated with
hospitals has also increased.\7\
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\3\https://content.naic.org/cipr-topics/pharmacy-benefit-managers.
\4\https://www.reuters.com/business/healthcare-pharmaceuticals/
which-cvs-rivals-also-own-primary-care-services-2023-02-08/.
\5\https://www.aei.org/research-products/report/hospital-
competition-and-restrictions-on-physician-owned-hospitals/.
\6\https://www.aei.org/research-products/report/policy-solutions-
for-hospital-consolidation/.
\7\https://www.cbo.gov/publication/57778.
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Consolidation in health care has contributed to
significantly higher prices in the commercial market compared
to Medicare. A recent Congressional Budget Office (CBO) report
found that commercial insurers' prices were 240 percent of
Medicare fee-for-service prices for outpatient services and 182
percent for inpatient services.\8\ Additionally, the prices
that commercial insurers pay hospitals are much higher than
hospitals' costs.\9\
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\8\Id.
\9\Id.
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Given that hospital prices are the number one contributor
to national health care expenditures, Congress has taken
previous action to rein in spending on services provided at
off-campus hospital outpatient departments (HOPDs). The
Bipartisan Budget Act of 2015 established ``site-neutral''
payments under Medicare for services provided in HOPDs.\10\
However, the law exempted existing off- campus HOPDs and those
under construction from complying with the requirement. As a
result, in practice, often Medicare still pays more for
services provided at HOPDs than it does when the same services
are provided in a doctor's office or outside of the hospital.
In 2022, ``Medicare [paid] 141 percent more in an HOPD than in
a freestanding office for the first hour of chemotherapy
infusion.''\11\
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\10\Pub. L. No. 114-74 (2015).
\11\https://www.medpac.gov/document/june-2022-report-to-the-
congress-medicare-and-the-health-care-delivery-system/.
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Similar issues exist in the commercial market. Hospitals
bill private health plans at higher rates than Medicare and
often tack on hospital facility fees for provider office
visits. In fact, prices for services provided by acquired
physicians increase by an average of 14.1 percent after
acquisition.\12\ Hospital consolidation and a lack of pricing
information contribute to private plans paying double what
Medicare would have paid for the same services.\13\ Estimated
savings gained from applying site-neutral payments to the
commercial market could reach nearly $60 billion annually.\14\
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\12\https://pubmed.ncbi.nlm.nih.gov/29727744/.
\13\https://www.rand.org/health-care/projects/price-transparency/
hospital-pricing.html.
\14\https://7fe67d73-acdc-4d7a-9f6a-0a2c5dd0a4bc.usrfiles.com/ugd/
7fe67d_b20c817a6e314fb0a05e331a22a2d995.pdf.
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During the HELP Subcommittee's June 21, 2023, hearing, Ms.
Sachdev spoke to the need for legislation to protect plans from
hospital facility fees applied to outpatient services, citing
recent actions in Indiana.\15\ Ms. Monahan elaborated on this
point, citing the challenges that plans and insurers face in
identifying outpatient services, given the lack of transparency
requirements on hospitals to identify services provided in the
outpatient setting.\16\ Ms. Tripoli further provided examples
of patients charged high hospital-facility fees, despite never
setting foot in the hospital charging them.\17\ Members and
witnesses called for legislation to protect employers and
workers from unnecessary costs by requiring honest billing
practices from hospitals for outpatient services.
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\15\https://edworkforce.house.gov/uploadedfiles/
sachdev_testimony.pdf.
\16\https://edworkforce.house.gov/uploadedfiles/
monahan_testimony.pdf.
\17\https://edworkforce.house.gov/uploadedfiles/
tripoli_testimony.pdf.
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Support for Transparency in Billing
Plans and consumers recognize the value of appropriate
billing for health care services. Better Solutions for
Healthcare applauded the Committee's focus on ensuring honest
billing practices by hospitals to promote competition and
transparency and to prevent markups of prices for services, all
of which create market distortions.\18\ Similarly, Families USA
praised the Committee's work ``to begin to remedy some of the
most obvious health system failings by advancing legislation to
rein in dishonest billing practices.''\19\
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\18\https://bettersolutionsforhealthcare.org/press-release-better-
solutions-applauds-congressional-scrutiny-on-dishonest- billing/
\19\https://familiesusa.org/press-releases/families-usa-congress-
continues-to-make-important-strides-toward-improved- transparency/.
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H.R. 4509, THE TRANSPARENCY IN BILLING ACT
H.R. 4509, the Transparency in Billing Act, amends ERISA to
require group health plans and health insurance issuers
offering group health insurance coverage only to pay claims
submitted by hospitals that have in place policies and
procedures to ensure accurate billing practices. H.R. 4509
prevents hospitals from submitting claims without a separate
unique health identifier for the off-campus outpatient
department. By imposing this requirement, the legislation
ensures that group health plans only pay for services that are
appropriately billed for the correct site of service, and it
prevents hospitals from obscuring the true site of service in
order to charge higher prices via facility fees or other
charges.
CONCLUSION
H.R. 4509, the Transparency in Billing Act, reaffirms
common sense: hospitals should only be allowed to bill at the
correct price for the site of care where services are rendered.
If a service is provided at an outpatient facility, it should
be billed at the rate associated with the off-campus outpatient
department, not as if it was provided at a hospital. The bill
also protects plans from paying for claims for services
rendered at an off-campus outpatient department that are
incorrectly billed. These are important protections for plans
and the participants and beneficiaries that they serve.
Codifying these protections in ERISA ensures that the vast
majority of insured Americans will benefit from these
protections, which will result in cost savings for employers
and workers alike.
Summary
H.R. 4509 SECTION BY SECTION SUMMARY
The following is a section-by-section analysis of H.R.
4509, the Transparency in Billing Act, introduced by Chairwoman
Foxx and Ranking Member Scott and reported favorably by the
Committee.
Section 1. Short title
Section 1 provides that the short title is ``Transparency
in Billing Act.''
Section 2. Honest billing requirements
Section 2 amends the Employee Retirement Income Security
Act of 1974 (ERISA) to prevent group health plans and health
insurance issuers from paying a claim submitted by a hospital
unless the hospital is in compliance with Section 3. The
effective date of Section 2 is January 1, 2024.
Section 3. Regulation of honest billing
Section 3 amends ERISA to disallow hospitals from
submitting a claim for items or services furnished at an off-
campus outpatient department to a group health plan or health
insurance issuer unless (1) the hospital obtains a separate
unique health identifier for the off-campus outpatient
department, and (2) the claim for these items or services
furnished at an off-campus outpatient department includes a
separate unique health identifier.
Section 4. Enforcement
Section 4 authorizes the U.S. Secretary of Labor to assess
civil monetary penalties against hospitals for violations: $300
per day for ongoing violations for hospitals with not more than
30 beds and $5,500 per day for ongoing violations for hospitals
with more than 30 beds.
Explanation of Amendments
The amendments, including the amendment in the nature of a
substitute, are explained in the body of this report.
Application of the Law to the Legislative Branch
Section 102(b)3 of Public Law 104-1 requires a description
of the application of this bill to the legislative branch. H.R.
4509 takes important steps to increase accountability that will
benefit health care consumers--including access for any
eligible employees of the Legislative Branch--by protecting
employer-sponsored health plans from paying for incorrectly
billed outpatient health claims.
Statement of General Performance Goals and Objections
The goal of H.R. 4509 is to protect employer-sponsored
health plans from overpaying for services that are incorrectly
billed by hospital outpatient facilities.
Required Committee Hearing and Related Hearings
In compliance with clause 3(c)(6) of rule XIII of the Rules
of House of Representatives, the following hearings held during
the 118th Congress were used to develop or consider H.R. 4509:
on April 26, 2023, the HELP Subcommittee held a hearing
entitled ``Reducing Health Care Costs for Working Americans and
Their Families''; on June 13, 2023, the Committee held a
hearing entitled ``Examining the Policies and Priorities of the
U.S. Department of Health and Human Services''; and on June 21,
2023, the HELP Subcommittee held a hearing entitled
``Competition and Transparency: The Pathway Forward for a
Stronger Health Care Market.''
Unfunded Mandate Statement
Pursuant to Section 423 of the Congressional Budget and
Impoundment Control Act of 1974, Pub. L. No. 93-344 (as amended
by Section 101(a)(2) of the Unfunded Mandates Reform Act of
1995, Pub. L. No. 104-4), the Committee adopts as its own the
cost estimate prepared by the Congressional Budget Office (CBO)
pursuant to section 402 of the Congressional Budget and
Impoundment Control Act of 1974.
Earmark Statement
H.R. 4509 does not contain any congressional earmarks,
limited tax benefits, or limited tariff benefits as defined in
clause 9 of rule XXI of the Rules of the House of
Representatives.
Roll Call Votes
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee Report to include, for
each record vote on a motion to report the measure or matter
and on any amendments offered to the measure or matter, the
total number of votes for and against and the names of the
Members voting for and against.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Duplication of Federal Programs
No provision of H.R. 4509 establishes or reauthorizes a
program of the Federal Government known to be duplicative of
another Federal program, a program that was included in any
report from the Government Accountability Office to Congress
pursuant to section 21 of Public Law 111-139, or a program
related to a program identified in the most recent Catalog of
Federal Domestic Assistance.
Statement of Oversight Findings and Recommendations of the Committee
In compliance with clause 3(c)(1) of rule XIII and clause
2(b)(1) of rule X of the Rules of the House of Representatives,
the Committee's oversight findings and recommendations are
reflected in the body of this report.
New Budget Authority and CBO Cost Estimate
With respect to the requirements of clause 3(c)(2) of rule
XIII of the Rules of the House of Representatives and section
308(a) of the Congressional Budget Act of 1974 and with respect
to requirements of clause 3(c)(3) of rule XIII of the Rules of
the House of Representatives and section 402 of the
Congressional Budget Act of 1974, the Committee requested a
cost estimate from the Congressional Budget Office. The
Committee adopts the following estimate for H.R. 4509 provided
by the Congressional Budget Office to Majority staff via email
on August 16, 2023: ``For H.R. 4509 (Transparency in Billing
Act of 2023, with time stamp July 11, 2023 at 9:50am),
consistent with the preliminary estimate we shared on 7/6/2023,
we estimate over the 2024-2033 period, there would be a
decrease in direct spending by $403 million and increase in
revenues by $1,919 million, for a total decrease in the deficit
of about $2,321 million (components do not sum to total due to
rounding). Of that reduction in the deficit, $81 million is a
reduction in Medicare outlays.''
Committee Cost Estimate
Clause 3(d)(1) of rule XIII of the Rules of the House of
Representatives requires an estimate and a comparison of the
costs that would be incurred in carrying out H.R. 4509.
However, clause 3(d)(2)(B) of that rule provides that this
requirement does not apply when, as with the present report,
the committee adopts as its own the cost estimate of the bill
prepared by the Congressional Budget Office under section 402
of the Congressional Budget Act.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italics, and existing law in which no
change is proposed is shown in roman):
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974
short title and table of contents
Section 1. This Act may be cited as the ``Employee Retirement
Income Security Act of 1974''.
TABLE OF CONTENTS
Sec. 1. Short title and table of contents.
* * * * * * *
Part 7--Group Health Plan Requirements
* * * * * * *
Subpart B--Other Requirements
* * * * * * *
Sec. 726. Honest billing requirements.
* * * * * * *
Part 9--Billing Requirements with Respect to Group Health Plans and
Coverage.
Sec. 901. Honest billing requirements.
* * * * * * *
TITLE I--PROTECTION OF EMPLOYEE BENEFIT RIGHTS
* * * * * * *
Subtitle B--Regulatory Provisions
* * * * * * *
Part 5--Administration and Enforcement
* * * * * * *
civil enforcement
Sec. 502. (a) A civil action may be brought--
(1) by a participant or beneficiary--
(A) for the relief provided for in subsection
(c) of this section, or
(B) to recover benefits due to him under the
terms of his plan, to enforce his rights under
the terms of the plan, or to clarify his rights
to future benefits under the terms of the plan;
(2) by the Secretary, or by a participant,
beneficiary or fiduciary for appropriate relief under
section 409;
(3) by a participant, beneficiary, or fiduciary (A)
to enjoin any act or practice which violates any
provision of this title or the terms of the plan, or
(B) to obtain other appropriate equitable relief (i) to
redress such violations or (ii) to enforce any
provisions of this title or the terms of the plan;
(4) by the Secretary, or by a participant, or
beneficiary for appropriate relief in the case of a
violation of section 105(c) or 113(a);
(5) except as otherwise provided in subsection (b),
by the Secretary (A) to enjoin any act or practice
which violates any provision of this title, or (B) to
obtain other appropriate equitable relief (i) to
redress such violation or (ii) to enforce any provision
of this title;
(6)by the Secretary to collect any civil penalty
under paragraph (2), (4), (5), (6), (7), (8), [or (9)]
(9), or (13) of subsection (c) or under subsection (i)
or (l);
(7) by a State to enforce compliance with a qualified
medical child support order (as defined in section
609(a)(2)(A));
(8) by the Secretary, or by an employer or other
person referred to in section 101(f)(1), (A) to enjoin
any act or practice which violates subsection (f) of
section 101, or (B) to obtain appropriate equitable
relief (i) to redress such violation or (ii) to enforce
such subsection;
(9) in the event that the purchase of an insurance
contract or insurance annuity in connection with
termination of an individual's status as a participant
covered under a pension plan with respect to all or any
portion of the participant's pension benefit under such
plan constitutes a violation of part 4 of this title or
the terms of the plan, by the Secretary, by any
individual who was a participant or beneficiary at the
time of the alleged violation, or by a fiduciary, to
obtain appropriate relief, including the posting of
security if necessary, to assure receipt by the
participant or beneficiary of the amounts provided or
to be provided by such insurance contract or annuity,
plus reasonable prejudgment interest on such amounts;
(10) in the case of a multiemployer plan that has
been certified by the actuary to be in endangered or
critical status under section 305, if the plan
sponsor--
(A) has not adopted a funding improvement or
rehabilitation plan under that section by the
deadline established in such section, or
(B) fails to update or comply with the terms
of the funding improvement or rehabilitation
plan in accordance with the requirements of
such section,
by an employer that has an obligation to contribute
with respect to the multiemployer plan or an employee
organization that represents active participants in the
multiemployer plan, for an order compelling the plan
sponsor to adopt a funding improvement or
rehabilitation plan or to update or comply with the
terms of the funding improvement or rehabilitation plan
in accordance with the requirements of such section and
the funding improvement or rehabilitation plan; or
(11) in the case of a multiemployer plan, by an
employee representative, or any employer that has an
obligation to contribute to the plan, (A) to enjoin any
act or practice which violates subsection (k) of
section 101 (or, in the case of an employer, subsection
(l) of such section), or (B) to obtain appropriate
equitable relief (i) to redress such violation or (ii)
to enforce such subsection.
(b)(1) In the case of a plan which is qualified under section
401(a), 403(a), or 405(a) of the Internal Revenue Code of 1986
(or with respect to which an application to so qualify has been
filed and has not been finally determined) the Secretary may
exercise his authority under subsection (a)(5) with respect to
a violation of, or the enforcement of, parts 2 and 3 of this
subtitle (relating to participation, vesting, and funding),
only if--
(A) requested by the Secretary of the Treasury, or
(B) one or more participants, beneficiaries, or
fiduciaries, of such plan request in writing (in such
manner as the Secretary shall prescribe by regulation)
that he exercise such authority on their behalf. In the
case of such a request under this paragraph he may
exercise such authority only if he determines that such
violation affects, or such enforcement is necessary to
protect, claims of participants or beneficiaries to
benefits under the plan.
(2) The Secretary shall not initiate an action to enforce
section 515.
(3) Except as provided in subsections (c)(9) and (a)(6) (with
respect to collecting civil penalties under subsection (c)(9)),
the Secretary is not authorized to enforce under this part any
requirement of part 7 against a health insurance issuer
offering health insurance coverage in connection with a group
health plan (as defined in section 706(a)(1)). Nothing in this
paragraph shall affect the authority of the Secretary to issue
regulations to carry out such part.
(c)(1) Any administrator (A) who fails to meet the
requirements of paragraph (1) or (4) of section 606, section
101(e)(1), section 101(f),, section 105(a), or section 113(a)
with respect to a participant or beneficiary, or (B) who fails
or refuses to comply with a request for any information which
such administrator is required by this title to furnish to a
participant or beneficiary (unless such failure or refusal
results from matters reasonably beyond the control of the
administrator) by mailing the material requested to the last
known address of the requesting participant or beneficiary
within 30 days after such request may in the court's discretion
be personally liable to such participant or beneficiary in the
amount of up to $100 a day from the date of such failure or
refusal, and the court may in its discretion order such other
relief as it deems proper. For purposes of this paragraph, each
violation described in subparagraph (A) with respect to any
single participant, and each violation described in
subparagraph (B) with respect to any single participant or
beneficiary, shall be treated as a separate violation.
(2) The Secretary may assess a civil penalty against any plan
administrator of up to $1,000 a day from the date of such plan
administrator's failure or refusal to file the annual report
required to be filed with the Secretary under section
101(b)(1). For purposes of this paragraph, an annual report
that has been rejected under section 104(a)(4) for failure to
provide material information shall not be treated as having
been filed with the Secretary.
(3) Any employer maintaining a plan who fails to meet the
notice requirement of section 101(d) with respect to any
participant or beneficiary or who fails to meet the
requirements of section 101(e)(2) with respect to any person or
who fails to meet the requirements of section 302(d)(12)(E)
with respect to any person may in the court's discretion be
liable to such participant or beneficiary or to such person in
the amount of up to $100 a day from the date of such failure,
and the court may in its discretion order such other relief as
it deems proper.
(4) The Secretary may assess a civil penalty of not more than
$1,000 a day for each violation by any person of subsection
(j), (k), or (l) of section 101 or section 514(e)(3).
(5) The Secretary may assess a civil penalty against any
person of up to $1,000 a day from the date of the person's
failure or refusal to file the information required to be filed
by such person with the Secretary under regulations prescribed
pursuant to section 101(g).
(6) If, within 30 days of a request by the Secretary to a
plan administrator for documents under section 104(a)(6), the
plan administrator fails to furnish the material requested to
the Secretary, the Secretary may assess a civil penalty against
the plan administrator of up to $100 a day from the date of
such failure (but in no event in excess of $1,000 per request).
No penalty shall be imposed under this paragraph for any
failure resulting from matters reasonably beyond the control of
the plan administrator.
(7) The Secretary may assess a civil penalty against a plan
administrator of up to $100 a day from the date of the plan
administrator's failure or refusal to provide notice to
participants and beneficiaries in accordance with subsection
(i) or (m) of section 101. For purposes of this paragraph, each
violation with respect to any single participant or beneficiary
shall be treated as a separate violation.
(8) The Secretary may assess against any plan sponsor
of a multiemployer plan a civil penalty of not more
than $1,100 per day--
(A) for each violation by such sponsor of the
requirement under section 305 to adopt by the
deadline established in that section a funding
improvement plan or rehabilitation plan with
respect to a multiemployer plan which is in
endangered or critical status, or
(B) in the case of a plan in endangered
status which is not in seriously endangered
status, for failure by the plan to meet the
applicable benchmarks under section 305 by the
end of the funding improvement period with
respect to the plan.
(9)(A) The Secretary may assess a civil penalty against any
employer of up to $100 a day from the date of the employer's
failure to meet the notice requirement of section
701(f)(3)(B)(i)(I). For purposes of this subparagraph, each
violation with respect to any single employee shall be treated
as a separate violation.
(B) The Secretary may assess a civil penalty against any plan
administrator of up to $100 a day from the date of the plan
administrator's failure to timely provide to any State the
information required to be disclosed under section
701(f)(3)(B)(ii). For purposes of this subparagraph, each
violation with respect to any single participant or beneficiary
shall be treated as a separate violation.
(10) Secretarial enforcement authority relating to
use of genetic information.--
(A) General rule.--The Secretary may impose a
penalty against any plan sponsor of a group
health plan, or any health insurance issuer
offering health insurance coverage in
connection with the plan, for any failure by
such sponsor or issuer to meet the requirements
of subsection (a)(1)(F), (b)(3), (c), or (d) of
section 702 or section 701 or 702(b)(1) with
respect to genetic information, in connection
with the plan.
(B) Amount.--
(i) In general.--The amount of the
penalty imposed by subparagraph (A)
shall be $100 for each day in the
noncompliance period with respect to
each participant or beneficiary to whom
such failure relates.
(ii) Noncompliance period.--For
purposes of this paragraph, the term
``noncompliance period'' means, with
respect to any failure, the period--
(I) beginning on the date
such failure first occurs; and
(II) ending on the date the
failure is corrected.
(C) Minimum penalties where failure
discovered.--Notwithstanding clauses (i) and
(ii) of subparagraph (D):
(i) In general.--In the case of 1 or
more failures with respect to a
participant or beneficiary--
(I) which are not corrected
before the date on which the
plan receives a notice from the
Secretary of such violation;
and
(II) which occurred or
continued during the period
involved;
the amount of penalty imposed by
subparagraph (A) by reason of such
failures with respect to such
participant or beneficiary shall not be
less than $2,500.
(ii) Higher minimum penalty where
violations are more than de minimis.--
To the extent violations for which any
person is liable under this paragraph
for any year are more than de minimis,
clause (i) shall be applied by
substituting ``$15,000'' for ``$2,500''
with respect to such person.
(D) Limitations.--
(i) Penalty not to apply where
failure not discovered exercising
reasonable diligence.--No penalty shall
be imposed by subparagraph (A) on any
failure during any period for which it
is established to the satisfaction of
the Secretary that the person otherwise
liable for such penalty did not know,
and exercising reasonable diligence
would not have known, that such failure
existed.
(ii) Penalty not to apply to failures
corrected within certain periods.--No
penalty shall be imposed by
subparagraph (A) on any failure if--
(I) such failure was due to
reasonable cause and not to
willful neglect; and
(II) such failure is
corrected during the 30-day
period beginning on the first
date the person otherwise
liable for such penalty knew,
or exercising reasonable
diligence would have known,
that such failure existed.
(iii) Overall limitation for
unintentional failures.--In the case of
failures which are due to reasonable
cause and not to willful neglect, the
penalty imposed by subparagraph (A) for
failures shall not exceed the amount
equal to the lesser of--
(I) 10 percent of the
aggregate amount paid or
incurred by the plan sponsor
(or predecessor plan sponsor)
during the preceding taxable
year for group health plans; or
(II) $500,000.
(E) Waiver by secretary.--In the case of a
failure which is due to reasonable cause and
not to willful neglect, the Secretary may waive
part or all of the penalty imposed by
subparagraph (A) to the extent that the payment
of such penalty would be excessive relative to
the failure involved.
(F) Definitions.--Terms used in this
paragraph which are defined in section 733
shall have the meanings provided such terms in
such section.
(11) The Secretary and the Secretary of Health and Human
Services shall maintain such ongoing consultation as may be
necessary and appropriate to coordinate enforcement under this
subsection with enforcement under section 1144(c)(8) of the
Social Security Act.
(12) The Secretary may assess a civil penalty against
any sponsor of a CSEC plan of up to $100 a day from the
date of the plan sponsor's failure to comply with the
requirements of section 306(j)(3) to establish or
update a funding restoration plan.
(13) The Secretary may assess a civil monetary
penalty against a hospital for a violation under
section 901 in an amount--
(A) in the case of a hospital with not more
than 30 beds (as determined under section
180.90(c)(2)(ii)(D) of title 45, Code of
Federal Regulations, as in effect on the date
of the enactment of this paragraph), not to
exceed $300 per day that the violation is
ongoing, as determined by the Secretary; and
(B) in the case of a hospital with more than
30 beds (as so determined), not to exceed
$5,500 per each such day.
(d)(1) An employee benefit plan may sue or be sued under this
title as an entity. Service of summons, subpena, or other legal
process of a court upon a trustee or an administrator of an
employee benefit plan in his capacity as such shall constitute
service upon the employee benefit plan. In a case where a plan
has not designated in the summary plan description of the plan
an individual as agent for the service of legal process,
service upon the Secretary shall constitute such service. The
Secretary, not later than 15 days after receipt of service
under the preceding sentence, shall notify the administrator or
any trustee of the plan of receipt of such service.
(2) Any money judgment under this title against an employee
benefit plan shall be enforceable only against the plan as an
entity and shall not be enforceable against any other person
unless liability against such person is established in his
individual capacity under this title.
(e)(1) Except for actions under subsection (a)(1)(B) of this
section, the district courts of the United States shall have
exclusive jurisdiction of civil actions under this title
brought by the Secretary or by a participant, beneficiary,
fiduciary, or any person referred to in section 101(f)(1).
State courts of competent jurisdiction and district courts of
the United States shall have concurrent jurisdiction of actions
under paragraphs (1)(B) and (7) of subsection (a) of this
section.
(2) Where an action under this title is brought in a district
court of the United States, it may be brought in the district
where the plan is administered, where the breach took place, or
where a defendant resides or may be found, and process may be
served in any other district where a defendant resides or may
be found.
(f) The district courts of the United States shall have
jurisdiction, without respect to the amount in controversy or
the citizenship of the parties, to grant the relief provided
for in subsection (a) of this section in any action.
(g)(1) In any action under this title (other than an action
described in paragraph (2)) by a participant, beneficiary, or
fiduciary, the court in its discretion may allow a reasonable
attorney's fee and costs of action to either party.
(2) In any action under this title by a fiduciary for or on
behalf of a plan to enforce section 515 in which a judgment in
favor of the plan is awarded, the court shall award the plan--
(A) the unpaid contributions,
(B) interest on the unpaid contributions,
(C) an amount equal to the greater of--
(i) interest on the unpaid contributions, or
(ii) liquidated damages provided for under
the plan in an amount not in excess of 20
percent (or such higher percentage as may be
permitted under Federal or State law) of the
amount determined by the court under
subparagraph (A),
(D) reasonable attorney's fees and costs of the
action, to be paid by the defendant, and
(E) such other legal or equitable relief as the court
deems appropriate.
For purposes of this paragraph, interest on unpaid
contributions shall be determined by using the rate provided
under the plan, or, if none, the rate prescribed under section
6621 of the Internal Revenue Code of 1986.
(h) A copy of the complaint in any action under this title by
a participant, beneficiary, or fiduciary (other than an action
brought by one or more participants or beneficiaries under
subsection (a)(1)(B) which is solely for the purpose of
recovering benefits due such participants under the terms of
the plan) shall be served upon the Secretary and the Secretary
of the Treasury by certified mail. Either Secretary shall have
the right in his discretion to intervene in any action, except
that the Secretary of the Treasury may not intervene in any
action under part 4 of this subtitle. If the Secretary brings
an action under subsection (a) on behalf of a participant or
beneficiary, he shall notify the Secretary of the Treasury.
(i) In the case of a transaction prohibited by section 406 by
a party in interest with respect to a plan to which this part
applies, the Secretary may assess a civil penalty against such
party in interest. The amount of such penalty may not exceed 5
percent of the amount involved in each such transaction (as
defined in section 4975(f)(4) of the Internal Revenue Code of
1986) for each year or part thereof during which the prohibited
transaction continues, except that, if the transaction is not
corrected (in such manner as the Secretary shall prescribe in
regulations which shall be consistent with section 4975(f)(5)
of such Code) within 90 days after notice from the Secretary
(or such longer period as the Secretary may permit), such
penalty may be in an amount not more than 100 percent of the
amount involved. This subsection shall not apply to a
transaction with respect to a plan described in section
4975(e)(1) of such Code.
(j) In all civil actions under this title, attorneys
appointed by the Secretary may represent the Secretary (except
as provided in section 518(a) of title 28, United States Code),
but all such litigation shall be subject to the direction and
control of the Attorney General.
(k) Suits by an administrator, fiduciary, participant, or
beneficiary of an employee benefit plan to review a final order
of the Secretary, to restrain the Secretary from taking any
action contrary to the provisions of this Act, or to compel him
to take action required under this title, may be brought in the
district court of the United States for the district where the
plan has its principal office, or in the United States District
Court for the District of Columbia.
(l)(1) In the case of--
(A) any breach of fiduciary responsibility under (or
other violation of) part 4 by a fiduciary, or
(B) any knowing participation in such a breach or
violation by any other person,
the Secretary shall assess a civil penalty against such
fiduciary or other person in an amount equal to 20 percent of
the applicable recovery amount.
(2) For purposes of paragraph (1), the term ``applicable
recovery amount'' means any amount which is recovered from a
fiduciary or other person with respect to a breach or violation
described in paragraph (1)--
(A) pursuant to any settlement agreement with the
Secretary, or
(B) ordered by a court to be paid by such fiduciary
or other person to a plan or its participants and
beneficiaries in a judicial proceeding instituted by
the Secretary under subsection (a)(2) or (a)(5).
(3) The Secretary may, in the Secretary's sole discretion,
waive or reduce the penalty under paragraph (1) if the
Secretary determines in writing that--
(A) the fiduciary or other person acted reasonably
and in good faith, or
(B) it is reasonable to expect that the fiduciary or
other person will not be able to restore all losses to
the plan (or to provide the relief ordered pursuant to
subsection (a)(9)) without severe financial hardship
unless such waiver or reduction is granted.
(4) The penalty imposed on a fiduciary or other person under
this subsection with respect to any transaction shall be
reduced by the amount of any penalty or tax imposed on such
fiduciary or other person with respect to such transaction
under subsection (i) of this section and section 4975 of the
Internal Revenue Code of 1986.
(m) In the case of a distribution to a pension plan
participant or beneficiary in violation of section 206(e) by a
plan fiduciary, the Secretary shall assess a penalty against
such fiduciary in an amount equal to the value of the
distribution. Such penalty shall not exceed $10,000 for each
such distribution.
* * * * * * *
Part 7--Group Health Plan Requirements
* * * * * * *
Subpart B--Other Requirements
* * * * * * *
SEC. 726. HONEST BILLING REQUIREMENTS.
A group health plan or health insurance issuer offering group
health insurance coverage may not pay a claim for items and
services furnished to an individual at an off-campus outpatient
department of a provider (as defined in section 901(c))
submitted by a hospital (as defined in section 1861(e) of the
Social Security Act) unless such claim submitted by such
hospital includes the separate unique health identifier for the
department where items and services were furnished, in
accordance with section 901.
* * * * * * *
PART 9--BILLING REQUIREMENTS WITH RESPECT TO GROUP HEALTH PLANS AND
COVERAGE
SEC. 901. HONEST BILLING REQUIREMENTS.
(a) In General.--A hospital may not, with respect to items
and services furnished to an individual at an off-campus
outpatient department of a provider, submit a claim for such
items and services to a group health plan or health insurance
issuer, and may not hold such individual liable for such items
and services, unless--
(1) such hospital obtains a separate unique health
identifier established for such department pursuant to
section 1173(b) of the Social Security Act; and
(2) the claim for such items and services includes
such separate unique health identifier for such
department where such items and services were
furnished.
(b) Process for Reporting Suspected Violations.--Not later
than one year after the date of enactment of this section, the
Secretary shall establish a process under which a suspected
violation of this section may be reported to such Secretary.
(c) Off-campus Outpatient Department of a Provider Defined.--
For purposes of this paragraph, the term ``off-campus
outpatient department of a provider'' means a department of a
provider (as defined in section 413.65 of title 42, Code of
Federal Regulations, or any successor regulation) that is not
located--
(1) on the campus (as defined in such section) of
such provider; or
(2) within the distance (described in such definition
of campus) from a remote location of a hospital
facility (as defined in such section).
* * * * * * *
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