Church Health Plan Act of 2013

Summary: Church Health Plan Act of 2013 - Amends the Patient Protection and Affordable Care Act (PPACA) to include qualified church plans, established and maintained for employees or their beneficiaries, by a church or by a convention or association of churches, as qualified health plans that provide essential health benefits packages. Excludes such plans from participation in American Health Benefits Exchanges established by states. Allows such plans to: (1) differentiate premiums using methods and criteria consistent with those used to assess charges and payments to other qualified health plans based on PPACA risk adjustment requirements and regulations concerning rates and payments, and (2) develop additional methods and criteria to define and account for the actuarial risk associated with the prohibition against qualified church plans enrolling a larger number and more diverse pool of enrollees as long as such additional methods and criteria are consistent with the risk adjustment methods. Provides standards for deeming an employer participating in such a plan as an eligible small employer for purposes of the income tax credit for employee health insurance expenses. Deems an individual receiving minimum essential coverage under such a plan to: (1) satisfy the individual responsibility requirements of the Internal Revenue Code, and (2) qualify for premium tax credits and reductions in cost-sharing if the household income requirements are met.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Church Health Plan Act of 2013''.

SEC. 2. CHURCH PLANS AS QUALIFIED HEALTH PLANS.

    (a) In General.--Section 1301(a) of the Patient Protection and 
Affordable Care Act (42 U.S.C. 18021(a)) is amended--
            (1) by redesignating paragraphs (3) and (4) as paragraphs 
        (4) and (5), respectively; and
            (2) by inserting after paragraph (2), the following:
            ``(3) Inclusion of qualified church plans.--
                    ``(A) In general.--Any reference in this title to a 
                qualified health plan shall be deemed to include a 
                qualified church plan, unless specifically provided for 
                otherwise.
                    ``(B) Requirements of qualified church plans.--A 
                qualified church plan is a church plan, as defined in 
                section 414(e) of the Internal Revenue Code of 1986, 
                that--
                            ``(i) is a welfare plan, as defined in 
                        section 2(c) of Public Law 106-244, and 
                        provides health care coverage for the employees 
                        of ten or more eligible common law employers, 
                        and if a majority of employees covered by the 
                        plan are employees of churches or qualified 
                        church-controlled organizations within the 
                        meaning of sections 3121(w)(3) (A) and (B) of 
                        the Internal Revenue Code of 1986, 
                        respectively;
                            ``(ii) provides an essential health 
                        benefits package, as defined in section 
                        1302(a);
                            ``(iii) complies with the requirements 
                        under sections 2703, 2706, 2708, 2709, 2711, 
                        2712, 2713, 2714, 2715, 2719, and 2719A of the 
                        Public Health Service Act;
                            ``(iv) prohibits exclusions based on 
                        preexisting conditions or other health status, 
                        and prohibits discrimination against individual 
                        participants and beneficiaries based on health 
                        status for the purposes of enrollment, within 
                        the meaning of sections 2704 and 2705 of the 
                        Public Health Service Act, except as provided 
                        under subparagraph (C)(ii); and
                            ``(v) limits, on average, the ratio of 
                        incurred losses plus loss adjustment expenses 
                        to earned premiums, within the meaning of 
                        section 2718 of the Public Health Service Act, 
                        as calculated across the entire church plan, 
                        except that, for purposes of this paragraph, 
                        earned premiums include payments by, or on 
                        behalf of, employees of a church, as defined in 
                        414(e)(3)(B) of the Internal Revenue Code of 
                        1986.
                    ``(C) Exclusion of qualified church plans from 
                american health benefit exchanges.--
                            ``(i) In general.--A qualified church plan 
                        may not participate in an American Health 
                        Benefit Exchange established by a State under 
                        section 1311(b) or by the Secretary of Health 
                        and Human Services (referred to in this 
                        paragraph as the `Secretary') under 1321(c). 
                        The Secretary shall not assess a charge or make 
                        a payment to a qualified church plan to reflect 
                        actuarial risk pursuant to section 1343, and a 
                        qualified church plan shall be exempt from any 
                        other subsidies, payments, or requirements 
                        under this Act that apply to qualified health 
                        plans offered on American Health Benefit 
                        Exchanges, except as provided by this 
                        paragraph.
                            ``(ii) Premiums.--A qualified church plan 
                        may differentiate premiums using methods and 
                        criteria consistent with those that the 
                        Secretary uses to assess charges and payments 
                        to other qualified health plans based on the 
                        actuarial risks of enrollees of such plans 
                        pursuant to section 1343 and those described in 
                        section 422.308 of title 42, Code of Federal 
                        Regulations. A qualified church plan may 
                        develop additional methods and criteria to 
                        define and account for the actuarial risk 
                        associated with the prohibition against 
                        qualified church plans enrolling a larger 
                        number and more diverse pool of enrollees as 
                        long as such additional methods and criteria 
                        are not inconsistent with the risk adjusters 
                        described in section 1343 and those described 
                        in section 422.308 of title 42, Code of Federal 
                        Regulations.
                    ``(D) Deemed status of qualified church plans.--A 
                qualified church plan shall be deemed to be--
                            ``(i) minimum essential coverage under an 
                        eligible employer-sponsored plan, as defined 
                        under section 5000A(f)(2) of the Internal 
                        Revenue Code of 1986; and
                            ``(ii) for the purposes of subparagraph 
                        (F), equivalent to a health plan offered 
                        through an American Health Benefit Exchange, 
                        within the meaning of section 1311(b).
                    ``(E) Employers participating in qualified church 
                plans.--
                            ``(i) Eligible small employers.--An 
                        employer participating in a qualified church 
                        plan shall be deemed an eligible small employer 
                        under section 45R(d) of the Internal Revenue 
                        Code of 1986, if--
                                    ``(I) the employer has not more 
                                than 25 full-time equivalent employees, 
                                as defined under section 45R(d)(2) of 
                                the Internal Revenue Code of 1986, for 
                                the taxable year; and
                                    ``(II) the average annual wages of 
                                such full-time equivalent employees do 
                                exceed an amount equal to twice the 
                                dollar amount in effect under section 
                                45R(d)(3)(B) of the Internal Revenue 
                                Code of 1986 for the taxable year, and 
                                if no employee of the employer who is 
                                enrolled in the qualified church plan 
                                receives premium tax credits or 
                                reductions in cost-sharing under 
                                subparagraph (F).
                            ``(ii) No exclusion from wages.--Any 
                        employer participating in a qualified church 
                        plan shall not exclude from wages and other 
                        compensation, for any individual receiving 
                        premium tax credits under section 1401, any 
                        employer contribution for minimum essential 
                        coverage under a qualified church plan under 
                        section 106 of the Internal Revenue Code of 
                        1986.
                            ``(iii) Employers participating in 
                        qualified church plans.--Any employer 
                        participating in a qualified church plan shall 
                        be deemed to be a `religious employer' as 
                        defined in section 147.131 of title 45, Code of 
                        Federal Regulations.
                    ``(F) Premium tax credits, reductions in cost-
                sharing, and qualified church plans.--An individual 
                receiving minimum essential coverage under a qualified 
                church plan--
                            ``(i) shall be deemed to satisfy the 
                        individual responsibility requirements under 
                        section 5000A of the Internal Revenue Code of 
                        1986;
                            ``(ii) shall be deemed to qualify as an 
                        applicable taxpayer eligible to receive premium 
                        tax credits under section 1401, if the 
                        individual's household income for the taxable 
                        year equals or exceeds 100 percent but does not 
                        exceed 400 percent of an amount equal to the 
                        poverty line for a family of the size involved; 
                        and
                            ``(iii) shall be deemed to qualify as an 
                        eligible insured eligible to receive reductions 
                        in cost-sharing under section 1402(b), if the 
                        individual's household income exceeds 100 
                        percent but does not exceed 400 percent of the 
                        poverty line for a family of the size involved.
                    ``(G) Regulations.--The Secretary and the Secretary 
                of the Treasury shall promulgate regulations--
                            ``(i) under subparagraph (E) to ensure that 
                        an eligible small employer offering a qualified 
                        church plan receives the same tax credit as any 
                        other eligible small employer under section 45R 
                        of the Internal Revenue Code of 1986;
                            ``(ii) under subparagraph (F)(ii) to ensure 
                        that an applicable taxpayer receiving minimum 
                        essential coverage under a qualified church 
                        plan receives the same premium tax credit as 
                        any other applicable taxpayer under section 
                        1401;
                            ``(iii) under subparagraph (F)(iii) to 
                        ensure that an eligible insured receiving 
                        minimum essential coverage under a qualified 
                        church plan receives the same reduction in 
                        cost-sharing as any other eligible insured 
                        under section 1402; and
                            ``(iv) providing church plans sufficient 
                        opportunity to make appropriate transitions in 
                        order to meet the definition of qualified 
                        church plan under subparagraph (B).''.
    (b) Effective Date.--The amendments made by this Act shall take 
effect as if enacted as part of the Patient Protection and Affordable 
Care Act (Public Law 111-148).