I 

114TH CONGRESS 

1ST SESSION H. R. 4262 

To amend title I of the Patient Protection and Affordable Care Act to 

require that a State awarded a Federal grant to establish an Exchange 

and that terminates the State operation of such an Exchange provide 

for an audit of the use of grant funds and return funds to the Federal 

Government, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 16, 2015 

Mr. ALLEN introduced the following bill; which was referred to the Committee 

on Energy and Commerce 

A BILL 

To amend title I of the Patient Protection and Affordable 

Care Act to require that a State awarded a Federal 

grant to establish an Exchange and that terminates the 

State operation of such an Exchange provide for an 

audit of the use of grant funds and return funds to 

the Federal Government, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Transparency and Ac5 countability of Failed Exchanges Act’’. 


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1 SEC. 2. STATES AWARDED EXCHANGE ESTABLISHMENT 

2 GRANTS THAT TERMINATE STATE OPER3 ATION OF SUCH AN EXCHANGE REQUIRED TO 

4 PROVIDE AUDITS OF THE USE OF GRANT 

5 FUNDS AND RETURN FUNDS TO THE FED6 ERAL GOVERNMENT. 

7 (a) IN GENERAL.—Section 1311(a) of the Patient 

8 Protection and Affordable Care Act (42 U.S.C. 18031(a)) 

9 is amended by adding at the end the following new para10 graph: 

11 ‘‘(6) TREATMENT IN CASE OF EXCHANGE TER12 MINATION.— 

13 ‘‘(A) IN GENERAL.—In the case of a State 

14 that is awarded a grant under this section to 

15 establish an Exchange and that terminates the 

16 operation of such Exchange or otherwise trans17 fers the operation of such Exchange to an enti18 ty other than such State— 

19 ‘‘(i) not later than 30 days after the 

20 date of such termination or transfer, the 

21 State shall submit to Congress and the 

22 Secretary a report containing the results of 

23 an audit of how amounts awarded to such 

24 State pursuant to such grant were used; 

25 and 


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1 ‘‘(ii) not later than 30 days after the 

2 date of such termination or transfer— 

3 ‘‘(I) in accordance with subpara4 graph (B), there are rescinded any 

5 unobligated amounts awarded to such 

6 State pursuant to such grant; and 

7 ‘‘(II) in accordance with subpara8 graph (C), the State shall provide to 

9 the Administrator of General Services 

10 any property acquired by such State 

11 with amounts awarded to such State 

12 pursuant to such grant and shall sub13 mit to Congress and the Secretary a 

14 record of the provision of such prop15 erty to the Administrator. 

16 ‘‘(B) RETENTION OF FUNDS FOR DEFICIT

17 REDUCTION.—Funds rescinded under subpara18 graph (A)(ii)(I) shall be retained in the general 

19 fund of the Treasury for Federal budget deficit 

20 reduction. 

21 ‘‘(C) TREATMENT OF PROPERTY.—The 

22 Administrator of General Services may— 

23 ‘‘(i) dispose of any property obtained 

24 pursuant to subparagraph (A)(ii)(II) 

25 through a public auction for cash and for 


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1 not less than the fair market value of the 

2 property, as determined by the Adminis3 trator; 

4 ‘‘(ii) provide to any Federal agency 

5 such property for official use by such agen6 cy; or 

7 ‘‘(iii) lease or hire such property, and 

8 may insure such property. 

9 ‘‘(D) EXEMPTION FROM CERTAIN PROP10 ERTY DISPOSAL REQUIREMENTS.—Any disposal 

11 of property conducted under subparagraph 

12 (C)(i) shall not be subject to— 

13 ‘‘(i) subchapter IV of chapter 5 of 

14 subtitle I of title 40, United States Code; 

15 ‘‘(ii) sections 550 and 553 of title 40, 

16 United States Code; 

17 ‘‘(iii) section 501 of the McKinney18 Vento Homeless Assistance Act (42 U.S.C. 

19 11411); 

20 ‘‘(iv) any other provision of law au21 thorizing the no-cost conveyance of prop22 erty owned by the Federal Government; or 

23 ‘‘(v) any congressional notification re24 quirement other than that in section 545 

25 of title 40, United States Code. 


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1 ‘‘(E) INCOME FROM PROPERTY.—The Ad2 ministrator shall deposit any income from the 

3 disposition, lease, or hire of the property ob4 tained pursuant to subparagraph (A)(ii)(II) in 

5 the general fund of the Treasury for Federal 

6 budget deficit reduction.’’. 

7 (b) APPLICATION OF THE FALSE CLAIMS ACT.—Sec8 tion 1313(a)(6)(A) of the Patient Protection and Afford9 able Care Act (42 U.S.C. 18033(a)(6)(A)) is amended by 

10 adding at the end the following: ‘‘Further, except as other11 wise provided for expressly under this Act, the False 

12 Claims Act preempts any State enforcement action of al13 leged fraud, waste, and abuse of funds issued pursuant 

14 to this Act. States that terminate or transfer their ex15 change will refer all current and future matters involving 

16 fraud, waste, and abuse of funds issued pursuant to this 

17 Act to the United States Department of Justice. Any cur18 rent or future enforcement action shall be removed to or 

19 brought in Federal court. All fines, penalties, damages, 

20 or awards, monetary or otherwise, arising out of any cur21 rent or future enforcement action, represent Federal funds 

22 that shall be returned to the United States.’’. 

23 (c) ENFORCEMENT ACTION.—The Attorney General 

24 may bring an action before the appropriate district court 

25 of the United States to enforce section 1311(a)(6) of the 


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1 Patient Protection and Affordable Care Act (42 U.S.C. 

2 18031(a)(6)). 

3 (d) EFFECTIVE DATE.—The provisions of this sec4 tion, including the amendment made by this section, shall 

5 apply with respect to grants made before, on, or after the 

6 date of the enactment of this Act. 

Æ 


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