I 

110TH CONGRESS 

1ST SESSION H. R. 2626 

To provide for incentives to encourage health insurance coverage, and for 

other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 7, 2007 

Mr. PRICE of Georgia introduced the following bill; which was referred to the 

Committee on Ways and Means, and in addition to the Committees on 

Energy and Commerce, Education and Labor, Oversight and Government 

Reform, and the Judiciary, for a period to be subsequently determined 

by the Speaker, in each case for consideration of such provisions as fall 

within the jurisdiction of the committee concerned 

A BILL 

To provide for incentives to encourage health insurance 

coverage, 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; FINDINGS; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Comprehensive Health Coverage And Reform Enhance6 ment Act of 2007’’ or as the ‘‘Comprehensive 

7 HealthCARE Act of 2007’’. 

8 (b) FINDINGS.—Congress finds the following: 

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1 (1) Americans are best served by a health care 

2 system that thrives on and rewards competition, 

3 choice, personal control, affordability, accessibility, 

4 and quality. Now is the time to initiate new policies 

5 that allow innovation to excel and that respond best 

6 to patient’s demands, needs, and preferences. 

7 (2) In 2005, health care spending in the United 

8 States reached $2 trillion, and it is projected to 

9 reach $2.9 trillion in 2009. Health care spending is 

10 projected to reach $4 trillion by 2015. 

11 (3) In 2005, the total national health expendi12 tures rose 6.9 percent—two times the rate of infla13 tion. Total health care spending represented 16 per14 cent of the gross domestic product (GDP). 

15 (4) Census data show that 46.6 million Ameri16 cans were uninsured at some point in 2005, an in17 crease of 1.3 million from the comparable number of 

18 uninsured in 2004 (45.3 million). This percentage 

19 rose from 15.6 percent in 2004 to 15.9 percent in 

20 2005. 

21 (5) Lack of insurance is much more common 

22 among people with low incomes. Some 24.4 percent 

23 of people with incomes below $25,000 were unin24 sured in 2005, almost triple the rate of 8.5 percent 

25 among people with incomes over $75,000. 

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1 (6) National surveys show that the primary rea2 son people are uninsured is the high cost of health 

3 insurance coverage. 

4 (7) The percentage of Americans who are unin5 sured continues to rise due to a decrease of employ6 ees with employer-sponsored coverage. 

7 (8) Premiums for employer-based health insur8 ance rose by 7.7 percent in 2006. Small employers 

9 saw their premiums, on average, increase 8.8 per10 cent. Firms with less than 24 workers, experienced 

11 an increase of 10.5 percent. 

12 (9) The average employee contribution to com13 pany-provided health insurance has increased more 

14 than 143 percent since 2000. Average out-of-pocket 

15 costs for deductibles, co-payments for medications, 

16 and co-insurance for physician and hospital visits 

17 rose 115 percent during the same period. 

18 (10) With our current defined benefit model, 

19 employers determine health benefits, dictate costs 

20 for individuals and families, and hold the contract 

21 with the insurance company. 

22 (11) Employer-sponsored defined benefit health 

23 insurance plans have led employees to believe they 

24 are receiving free coverage, while economists have 

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1 shown that workers forgo higher wages in lieu of 

2 health benefits. 

3 (12) Americans pay higher prices for fewer 

4 choices under our current defined benefit model. 

5 (13) With both government and employer pro6 vided health care, there is a lack of individual owner7 ship and personal choice for patients. 

8 (14) There are 18 million Americans who pur9 chase health insurance on their own and currently, 

10 these individuals pay higher taxes than those who 

11 get insurance through their employer, due to the tax 

12 deductibility allowed to the employer for the pur13 chase pf health insurance. 

14 (15) Most of the incentives in our current sys15 tem are wrong, causing patients to frequently receive 

16 more tests and procedures than needed 

17 (16) Health insurers would be more responsive 

18 to individuals and families if health insurance poli19 cies were owned by the person most directly affected 

20 by the coverage—the patient. 

21 (17) Providing individuals and families with 

22 various options to help them secure and maintain 

23 personal, defined contribution coverage of their 

24 choice, would make health care coverage more af25 fordable and accessible for all Americans. 

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1 (18) It is appropriate to encourage increased ef2 ficiency in the offering of health insurance coverage 

3 through a collaborative approach by the States in 

4 regulating this coverage. 

5 (19) Individual health insurance coverage is in6 creasingly offered through the Internet, other elec7 tronic means, and by mail; all of which are inher8 ently part of interstate commerce. 

9 (20) The application of numerous and signifi10 cant variations in State law impacts the ability of in11 surers to offer, and individuals to obtain, affordable 

12 individual health insurance coverage, thereby imped13 ing commerce in individual health insurance cov14 erage. 

15 (21) Our current civil justice system is ad16 versely affecting patient access to health care serv17 ices, better patient care, and cost-efficient health 

18 care. The health care liability system is a costly and 

19 ineffective mechanism for resolving claims of health 

20 care liability and appropriately compensating injured 

21 patients, and is a deterrent to the sharing of infor22 mation among health care professionals which im23 pedes efforts to improve patient safety and quality 

24 health care. 

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1 (22) Permitting health care professionals to ne2 gotiate collectively with health care plans will create 

3 a more equal balance of negotiating power, will pro4 mote competition, and will enhance the quality of 

5 patient care. 

6 (23) The benefits of an electronic healthcare in7 formation system include improved quality of care, 

8 reduced costs associated with medication errors, 

9 more accurate and complete medical documentation, 

10 more accurate capture of codes and charges, and im11 proved communication among providers enabling 

12 them to respond more quickly to patients’ needs and 

13 increase health care quality. 

14 (24) To secure access to quality health care it 

15 is essential to have well trained and an appropriate 

16 number of physicians and surgeons to administer 

17 that care. 

18 (25) Data shows that median private medical 

19 school tuition and fees has increased by 50 percent 

20 (in real dollars) in the 20 years between 1984 and 

21 2004. Median public medical school tuition and fees 

22 increased by 133 percent over the same time period. 

23 (26) The cost of tuition may prevent students 

24 from low-income or minority populations and those 

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1 with other financial responsibilities from attending 

2 medical school. 

3 (27) Students with high debt are less likely to 

4 pursue family practice and primary care specialties 

5 and instead seek specialties with potentially higher 

6 income or more leisure time, which contributes to 

7 the physician shortages all over the country. 

8 (28) Emergency medical care is an essential 

9 element of the health care safety net. 

10 (29) The Emergency Medical Treatment and 

11 Labor Act (‘‘EMTALA’’) requires that all patients 

12 who come to an emergency department be evaluated 

13 and their emergency medical conditions be stabilized, 

14 regardless of the patient’s ability to pay. 

15 (30) Nationally, more than 35 percent of emer16 gency department patients are uninsured or are 

17 Medicaid or SCHIP enrollees. 

18 (31) Strain on emergency departments is due to 

19 multiple factors, including the shortage of nurses 

20 and on-call physicians, a decrease in the total num21 ber of community hospitals, and high levels of bad 

22 debt incurred as a result of providing care to indi23 gent patients. 

24 (32) With the decline in physicians, surgeons, 

25 hospitals, emergency rooms, employer-sponsored 

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1 health insurance, and the rising number of unin2 sured, the imperative for comprehensive health sys3 tem reform is readily apparent. 

4 (33) Patient access to quality care has been 

5 harmed by decreasing compensation to physicians 

6 through a flawed Medicare sustainable growth rate 

7 (SGR) system that fails to appropriately account for 

8 severity of illness, intensity of treatment, medical in9 flation, or costs. 

10 (34) Decisions regarding health care are often 

11 the most personal and important made in an individ12 ual’s life, however these decisions are increasingly 

13 being made without appropriate input by either pa14 tients or health care providers. 

15 (35) Fundamental reform throughout a wide 

16 array of our health care system is required in order 

17 to achieve a 21st century system that is innovative, 

18 responsive, affordable, accessible, accountable, of the 

19 highest quality, and, above all, patient-centered. 

20 (c) TABLE OF CONTENTS.—The table of contents of 

21 this Act is as follows: 

Sec. 1. Short title; findings; table of contents. 

TITLE I—TAX INCENTIVES FOR MAINTAINING HEALTH 

INSURANCE COVERAGE 

Sec. 101. Refundable tax credit for health insurance costs of low-income individuals. 

Sec. 102. Advance payment of credit as premium payment for qualified health 

insurance. 

Sec. 103. Deduction for qualified health insurance costs of individuals. 

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Sec. 104. Limitation on employer deduction for group health plan expenses. 

Sec. 105. Equal employer contribution rule to promote choice. 

TITLE II—QUALITY HEALTH-CARE PROFESSIONALS COALITION 

ACT 

Sec. 201. Short title. 

Sec. 202. Application of the antitrust laws to health care professionals negotiating with health plans. 

TITLE III—INTERSTATE MARKET FOR HEALTH INSURANCE 

Sec. 301. Cooperative governing of individual health insurance coverage. 

TITLE IV—HELP EFFICIENT, ACCESSIBLE, LOW-COST, TIMELY 

HEALTHCARE (HEALTH) ACT OF 2007 

Sec. 401. Short title. 

Sec. 402. Findings and purpose. 

Sec. 403. Encouraging speedy resolution of claims. 

Sec. 404. Compensating patient injury. 

Sec. 405. Maximizing patient recovery. 

Sec. 406. Additional HEALTH benefits. 

Sec. 407. Punitive damages. 

Sec. 408. Authorization of payment of future damages to claimants in 

HEALTH care lawsuits. 

Sec. 409. Definitions. 

Sec. 410. Effect on other laws. 

Sec. 411. State flexibility and protection of States’ rights. 

Sec. 412. Applicability; effective date. 

Sec. 413. Sense of Congress. 

Sec. 414. State grants to create administrative health care tribunals. 

TITLE V—TAX CREDIT FOR HEALTH INFORMATION 

TECHNOLOGY 

Sec. 501. Purchase of qualified health care information technology. 

Sec. 502. Telecommunications credit for qualified medical care providers. 

Sec. 503. Development of health care information technology standards. 

TITLE VI—MEDICAL LIABILITY REFORMS 

Sec. 601. Constitutional authority. 

Sec. 602. Protection against legal liability for emergency and related services 

furnished to any individual. 

TITLE VII—TAX DEDUCTION FOR UNCOMPENSATED CARE IN 

EMERGENCY ROOMS 

Sec. 701. Bad debt deduction for doctors to partially offset the cost of providing uncompensated care required to be provided under 

amendments made by the Emergency Medical Treatment and 

Labor Act. 

TITLE VIII—ADDITIONAL CHANGES 

Sec. 801. Application of section 1115 waivers by other States. 

Sec. 802. HIPAA Technical Advisory Group. 

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Sec. 803. Medicare physician payment update reform. 

Sec. 804. Removing limitations on balance billing with beneficiary notice for 

highest income beneficiaries. 

Sec. 805. Election of tax credit instead of alternative government benefits. 

Sec. 806. Use of private contracts by medicare beneficiaries for professional 

services. 

Sec. 807. EMTALA Technical Advisory Group. 

Sec. 808. Federally-Supported Student Loan Funds for Medical Students. 

Sec. 809. Establishment of performance-based quality measures. 

1 TITLE I—TAX INCENTIVES FOR 

2 MAINTAINING HEALTH IN3 SURANCE COVERAGE 

4 SEC. 101. REFUNDABLE TAX CREDIT FOR HEALTH INSUR5 ANCE COSTS OF LOW-INCOME INDIVIDUALS. 

6 (a) IN GENERAL.—Subpart C of subchapter A of 

7 chapter 1 of the Internal Revenue Code of 1986 (relating 

8 to refundable credits) is amended by redesignating section 

9 36 as section 37 and by inserting after section 35 the fol10 lowing new section: 

11 ‘‘SEC. 36. HEALTH INSURANCE COSTS OF LOW-INCOME IN12 DIVIDUALS. 

13 ‘‘(a) IN GENERAL.—In the case of an individual, 

14 there shall be allowed as a credit against the tax imposed 

15 by subtitle A the aggregate amount paid by the taxpayer 

16 for coverage of the taxpayer and the taxpayer’s qualifying 

17 family members under qualified health insurance for eligi18 ble coverage months beginning in the taxable year. 

19 ‘‘(b) LIMITATIONS.— 

20 ‘‘(1) IN GENERAL.—The amount allowable as a 

21 credit under subsection (a) for the taxable year shall 

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1 not exceed the sum of the monthly limitations for 

2 months during such taxable year that the taxpayer 

3 or the taxpayer’s qualifying family members is an el4 igible individual. 

5 ‘‘(2) MONTHLY LIMITATION.—The monthly limitation for any month is the credit percentage of 1 6 ⁄12

7 of the sum of— 

8 ‘‘(A) $4,000 for coverage of the taxpayer, 

9 ‘‘(B) in the case of a joint return, $4,000 

10 for coverage of the taxpayer’s spouse, and 

11 ‘‘(C) $2,000 for coverage of each depend12 ent of the taxpayer. 

13 ‘‘(3) CREDIT PERCENTAGE.— 

14 ‘‘(A) IN GENERAL.—For purposes of this 

15 section, the term ‘credit percentage’ means 90 

16 percent reduced by 1 percentage point for each 

17 $1,000 (or fraction thereof) by which the tax18 payer’s adjusted gross income for the taxable 

19 year exceeds the threshold amount. 

20 ‘‘(B) THRESHOLD AMOUNT.—For purposes 

21 of this paragraph, the term ‘threshold amount’ 

22 means, with respect to any taxpayer for any 

23 taxable year, the sum of— 

24 ‘‘(i) $20,000, 

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1 ‘‘(ii) in the case of a joint return, 

2 $6,000, and 

3 ‘‘(iii) $5,000 for each dependent of 

4 the taxpayer. 

5 ‘‘(4) ONLY 2 DEPENDENTS TAKEN INTO AC6 COUNT.—Not more than 2 dependents of the tax7 payer may be taken into account under paragraphs 

8 (2)(C) and (3)(B)(iii). 

9 ‘‘(5) INFLATION ADJUSTMENT.—In the case of 

10 any taxable year beginning in a calendar year after 

11 2009, each dollar amount contained in paragraph 

12 (2) or (3) shall be increased by an amount equal 

13 to— 

14 ‘‘(A) such dollar amount, multiplied by 

15 ‘‘(B) the cost-of-living adjustment deter16 mined under section 1(f)(3) for the calendar 

17 year in which the taxable year begins, deter18 mined by substituting ‘calendar year 2008’ for 

19 ‘calendar year 1992’ in subparagraph (B) 

20 thereof. 

21 Any increase determined under the preceding sen22 tence shall be rounded to the nearest multiple of 

23 $50. 

24 ‘‘(c) ELIGIBLE COVERAGE MONTH.—For purposes of 

25 this section, the term ‘eligible coverage month’ means, 

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1 with respect to any individual, any month if, as of the first 

2 day of such month, the individual— 

3 ‘‘(1) is covered by qualified health insurance, 

4 ‘‘(2) does not have other specified coverage, and 

5 ‘‘(3) is not imprisoned under Federal, State, or 

6 local authority. 

7 ‘‘(d) QUALIFYING FAMILY MEMBER.—For purposes 

8 of this section, the term ‘qualifying family member’ 

9 means— 

10 ‘‘(1) in the case of a joint return, the taxpayer’s 

11 spouse, and 

12 ‘‘(2) any dependent of the taxpayer. 

13 ‘‘(e) QUALIFIED HEALTH INSURANCE.— 

14 ‘‘(1) IN GENERAL.—For purposes of this sec15 tion, the term ‘qualified health insurance’ means any 

16 insurance which constitutes medical care. 

17 ‘‘(2) EXCEPTIONS.—Such term does not include 

18 insurance— 

19 ‘‘(A) substantially all of the coverage of 

20 which is of excepted benefits described in sec21 tion 9832(c); or 

22 ‘‘(B) offered in the individual market (as 

23 defined in paragraph (1) of section 2791(e) of 

24 the Public Health Service Act) or small group 

25 market (as defined in paragraph (5) of such 

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1 section) unless the insurance meets the require2 ments of paragraph (3). 

3 ‘‘(3) INSURANCE REQUIREMENTS.—For pur4 poses of paragraph (2)(B), the requirements of this 

5 paragraph with respect to insurance are the fol6 lowing: 

7 ‘‘(A) The issuer of the insurance may not 

8 decline to offer the insurance, or deny enroll9 ment, of any individual based on any factor de10 scribed in section 9802(a)(1). 

11 ‘‘(B) The insurance conforms to standards 

12 (established by the National Association of In13 surance Commissioners in consultation with in14 surance companies and recognized by the Sec15 retary) relating to each of the following: 

16 ‘‘(i) Limitation on application of pre17 existing condition exclusions (as defined in 

18 section 9801(b)(1)). 

19 ‘‘(ii) Guaranteed renewability. 

20 ‘‘(iii) Premium ratings. 

21 ‘‘(iv) Risk-spreading. 

22 ‘‘(v) Consumer disclosures. 

23 ‘‘(vi) Information provided to States 

24 and the Federal Government. 

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1 ‘‘(f) OTHER SPECIFIED COVERAGE.—For purposes of 

2 this section, an individual has other specified coverage for 

3 any month if, as of the first day of such month— 

4 ‘‘(1) COVERAGE UNDER MEDICARE, MEDICAID, 

5 OR SCHIP.—Such individual— 

6 ‘‘(A) is entitled to benefits under part A of 

7 title XVIII of the Social Security Act or is en8 rolled under part B of such title, or 

9 ‘‘(B) is enrolled in the program under title 

10 XIX or XXI of such Act (other than under sec11 tion 1928 of such Act). 

12 ‘‘(2) CERTAIN OTHER COVERAGE.—Such indi13 vidual— 

14 ‘‘(A) is enrolled in a health benefits plan 

15 under chapter 89 of title 5, United States Code, 

16 or 

17 ‘‘(B) is entitled to receive benefits under 

18 chapter 55 of title 10, United States Code. 

19 ‘‘(g) SPECIAL RULES.— 

20 ‘‘(1) COORDINATION WITH ADVANCE PAYMENTS

21 OF CREDIT; RECAPTURE OF EXCESS ADVANCE PAY22 MENTS.—With respect to any taxable year— 

23 ‘‘(A) the amount which would (but for this 

24 subsection) be allowed as a credit to the tax25 payer under subsection (a) shall be reduced 

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1 (but not below zero) by the aggregate amount 

2 paid on behalf of such taxpayer under section 

3 7529 for months beginning in such taxable 

4 year, and 

5 ‘‘(B) the tax imposed by section 1 for such 

6 taxable year shall be increased by the excess (if 

7 any) of— 

8 ‘‘(i) the aggregate amount paid on be9 half of such taxpayer under section 7529 

10 for months beginning in such taxable year, 

11 over 

12 ‘‘(ii) the amount which would (but for 

13 this subsection) be allowed as a credit to 

14 the taxpayer under subsection (a). 

15 ‘‘(2) COORDINATION WITH OTHER DEDUC16 TIONS.—Amounts taken into account under sub17 section (a) shall not be taken into account in deter18 mining— 

19 ‘‘(A) any deduction allowed under section 

20 162(l), 213, or 224, or 

21 ‘‘(B) any credit allowed under section 35. 

22 ‘‘(3) MEDICAL AND HEALTH SAVINGS AC23 COUNTS.—Amounts distributed from an Archer 

24 MSA (as defined in section 220(d)) or from a health 

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1 savings account (as defined in section 223(d)) shall 

2 not be taken into account under subsection (a). 

3 ‘‘(4) DENIAL OF CREDIT TO DEPENDENTS AND

4 NONPERMANENT RESIDENT ALIEN INDIVIDUALS .— 

5 No credit shall be allowed under this section to any 

6 individual who is— 

7 ‘‘(A) not a citizen or lawful permanent 

8 resident of the United States for the calendar 

9 year in which the taxable year begins, or 

10 ‘‘(B) a dependent with respect to another 

11 taxpayer for a taxable year beginning in the 

12 calendar year in which such individual’s taxable 

13 year begins. 

14 ‘‘(5) INSURANCE WHICH COVERS OTHER INDI15 VIDUALS.—For purposes of this section, rules simi16 lar to the rules of section 213(d)(6) shall apply with 

17 respect to any contract for qualified health insurance 

18 under which amounts are payable for coverage of an 

19 individual other than the taxpayer and qualifying 

20 family members. 

21 ‘‘(6) TREATMENT OF PAYMENTS.—For pur22 poses of this section— 

23 ‘‘(A) PAYMENTS BY SECRETARY.—Pay24 ments made by the Secretary on behalf of any 

25 individual under section 7529 (relating to admstockstill on PROD1PC66 with BILLS

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1 vance payment of credit for health insurance 

2 costs of low-income individuals) shall be treated 

3 as having been made by the taxpayer on the 

4 first day of the month for which such payment 

5 was made. 

6 ‘‘(B) PAYMENTS BY TAXPAYER.—Pay7 ments made by the taxpayer for eligible cov8 erage months shall be treated as having been 

9 made by the taxpayer on the first day of the 

10 month for which such payment was made. 

11 ‘‘(7) REGULATIONS.—The Secretary may pre12 scribe such regulations and other guidance as may 

13 be necessary or appropriate to carry out this section, 

14 section 6050W, and section 7529.’’. 

15 (b) CONFORMING AMENDMENTS.— 

16 (1) Paragraph (2) of section 1324(b) of title 

17 31, United States Code, is amended by inserting ‘‘or 

18 section 36’’ after ‘‘section 35’’. 

19 (2) The table of sections for subpart C of part 

20 IV of subchapter A of chapter 1 of the Internal Rev21 enue Code of 1986 is amended by redesignating the 

22 item relating to section 36 as an item relating to 

23 section 37 and by inserting after the item relating 

24 to section 35 the following new item: 

‘‘Sec. 36. Health insurance costs of low-income individuals.’’. 

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1 (c) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to taxable years beginning after 

3 December 31, 2008. 

4 SEC. 102. ADVANCE PAYMENT OF CREDIT AS PREMIUM 

5 PAYMENT FOR QUALIFIED HEALTH INSUR6 ANCE. 

7 (a) IN GENERAL.—Chapter 77 of the Internal Rev8 enue Code of 1986 (relating to miscellaneous provisions) 

9 is amended by adding at the end the following: 

10 ‘‘SEC. 7529. ADVANCE PAYMENT OF CREDIT AS PREMIUM 

11 PAYMENT FOR QUALIFIED HEALTH INSUR12 ANCE. 

13 ‘‘Not later than January 1, 2009, the Secretary shall 

14 establish a program for making payments to providers of 

15 qualified health insurance (as defined in section 36(e)) on 

16 behalf of taxpayers eligible for the credit under section 36. 

17 Except as otherwise provided by the Secretary, such pay18 ments shall be made on the basis of the adjusted gross 

19 income of the taxpayer for the preceding taxable year.’’. 

20 (b) DISCLOSURE OF RETURN INFORMATION FOR

21 PURPOSES OF ADVANCE PAYMENT OF CREDIT AS PRE22 MIUMS FOR QUALIFIED HEALTH INSURANCE.— 

23 (1) IN GENERAL.—Subsection (l) of section 

24 6103 of such Code is amended by adding at the end 

25 the following new paragraph: 

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1 ‘‘(21) DISCLOSURE OF RETURN INFORMATION

2 FOR PURPOSES OF ADVANCE PAYMENT OF CREDIT

3 AS PREMIUMS FOR QUALIFIED HEALTH INSUR4 ANCE.—The Secretary may, on behalf of taxpayers 

5 eligible for the credit under section 36, disclose to a 

6 provider of qualified health insurance (as defined in 

7 section 36(e)), and persons acting on behalf of such 

8 provider, return information with respect to any 

9 such taxpayer only to the extent necessary (as pre10 scribed by regulations issued by the Secretary) to 

11 carry out the program established by section 7529 

12 (relating to advance payment of credit as premium 

13 payment for qualified health insurance).’’. 

14 (2) CONFIDENTIALITY OF INFORMATION.— 

15 Paragraph (3) of section 6103(a) of such Code is 

16 amended by striking ‘‘or (20)’’ and inserting ‘‘(20), 

17 or (21)’’. 

18 (3) UNAUTHORIZED DISCLOSURE.—Paragraph 

19 (2) of section 7213(a) of such Code is amended by 

20 striking ‘‘or (20)’’ and inserting ‘‘(20), or (21)’’. 

21 (c) INFORMATION REPORTING.— 

22 (1) IN GENERAL.—Subpart B of part III of 

23 subchapter A of chapter 61 of such Code (relating 

24 to information concerning transactions with other 

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1 persons) is amended by adding at the end the fol2 lowing new section: 

3 ‘‘SEC. 6050W. RETURNS RELATING TO CREDIT FOR HEALTH 

4 INSURANCE COSTS OF LOW-INCOME INDIVID5 UALS. 

6 ‘‘(a) REQUIREMENT OF REPORTING.—Every person 

7 who is entitled to receive payments for any month of any 

8 calendar year under section 7529 (relating to advance pay9 ment of credit as premium payment for qualified health 

10 insurance) with respect to any individual shall, at such 

11 time as the Secretary may prescribe, make the return de12 scribed in subsection (b) with respect to each such indi13 vidual. 

14 ‘‘(b) FORM AND MANNER OF RETURNS.—A return 

15 is described in this subsection if such return— 

16 ‘‘(1) is in such form as the Secretary may pre17 scribe, and 

18 ‘‘(2) contains— 

19 ‘‘(A) the name, address, and TIN of each 

20 individual referred to in subsection (a), 

21 ‘‘(B) the number of months for which 

22 amounts were entitled to be received with re23 spect to such individual under section 7529 (re24 lating to advance payment of credit as premium 

25 payment for qualified health insurance), 

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1 ‘‘(C) the amount entitled to be received for 

2 each such month, and 

3 ‘‘(D) such other information as the Sec4 retary may prescribe. 

5 ‘‘(c) STATEMENTS TO BE FURNISHED TO INDIVID6 UALS WITH RESPECT TO WHOM INFORMATION IS RE7 QUIRED.—Every person required to make a return under 

8 subsection (a) shall furnish to each individual whose name 

9 is required to be set forth in such return a written state10 ment showing— 

11 ‘‘(1) the name and address of the person re12 quired to make such return and the phone number 

13 of the information contact for such person, and 

14 ‘‘(2) the information required to be shown on 

15 the return with respect to such individual. 

16 The written statement required under the preceding sen17 tence shall be furnished on or before January 31 of the 

18 year following the calendar year for which the return 

19 under subsection (a) is required to be made.’’. 

20 (2) ASSESSABLE PENALTIES.— 

21 (A) Subparagraph (B) of section 

22 6724(d)(1) of such Code (relating to defini23 tions) is amended by striking ‘‘or’’ at the end 

24 of clause (xix), by striking ‘‘and’’ at the end of 

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1 clause (xx) and inserting ‘‘or’’, and by inserting 

2 after clause (xx) the following new clause: 

3 ‘‘(xxi) section 6050W (relating to re4 turns relating to credit for health insur5 ance costs of low-income individuals), 

6 and’’. 

7 (B) Paragraph (2) of section 6724(d) of 

8 such Code is amended by striking ‘‘or’’ at the 

9 end of subparagraph (BB), by striking the pe10 riod at the end of subparagraph (CC) and in11 serting ‘‘, or’’, and by adding after subpara12 graph (CC) the following new subparagraph: 

13 ‘‘(DD) section 6050W (relating to returns 

14 relating to credit for health insurance costs of 

15 low-income individuals).’’. 

16 (d) CLERICAL AMENDMENTS.— 

17 (1) The table of sections for chapter 77 of such 

18 Code is amended by adding at the end the following 

19 new item: 

‘‘Sec. 7529. Advance payment of credit as premium payment for qualified 

health insurance.’’. 

20 (2) The table of sections for subpart B of part 

21 III of subchapter A of chapter 61 of such Code is 

22 amended by adding at the end the following new 

23 item: 

‘‘Sec. 6050W. Returns relating to credit for health insurance costs of low-income individuals.’’. 

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1 (e) EFFECTIVE DATE.—The amendments made by 

2 this section shall take effect on the date of the enactment 

3 of this Act. 

4 SEC. 103. DEDUCTION FOR QUALIFIED HEALTH INSURANCE 

5 COSTS OF INDIVIDUALS. 

6 (a) IN GENERAL.—Part VII of subchapter B of chap7 ter 1 of the Internal Revenue Code of 1986 (relating to 

8 additional itemized deductions) is amended by redesig9 nating section 224 as section 225 and by inserting after 

10 section 223 the following new section: 

11 ‘‘SEC. 224. COSTS OF QUALIFIED HEALTH INSURANCE. 

12 ‘‘(a) IN GENERAL.—In the case of an individual, 

13 there shall be allowed as a deduction an amount equal to 

14 the amount paid during the taxable year for coverage for 

15 the taxpayer, his spouse, and dependents under qualified 

16 health insurance. 

17 ‘‘(b) QUALIFIED HEALTH INSURANCE.—For pur18 poses of this section, the term ‘qualified health insurance’ 

19 means insurance which constitutes medical care; except 

20 that such term shall not include any insurance if substan21 tially all of its coverage is of excepted benefits described 

22 in section 9832(c). 

23 ‘‘(c) SPECIAL RULES.— 

24 ‘‘(1) COORDINATION WITH MEDICAL DEDUC25 TION, ETC.—Any amount paid by a taxpayer for inmstockstill on PROD1PC66 with BILLS

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1 surance to which subsection (a) applies shall not be 

2 taken into account in computing the amount allow3 able to the taxpayer as a deduction under section 

4 162(l) or 213(a). Any amount taken into account in 

5 determining the credit allowed under section 35 shall 

6 not be taken into account for purposes of this sec7 tion. 

8 ‘‘(2) DEDUCTION NOT ALLOWED FOR SELF-EM9 PLOYMENT TAX PURPOSES.—The deduction allow10 able by reason of this section shall not be taken into 

11 account in determining an individual’s net earnings 

12 from self-employment (within the meaning of section 

13 1402(a)) for purposes of chapter 2.’’. 

14 (b) DEDUCTION ALLOWED IN COMPUTING AD15 JUSTED GROSS INCOME.—Subsection (a) of section 62 of 

16 such Code is amended by inserting before the last sentence 

17 the following new paragraph: 

18 ‘‘(22) COSTS OF QUALIFIED HEALTH INSUR19 ANCE.—The deduction allowed by section 224.’’. 

20 (c) CLERICAL AMENDMENT.—The table of sections 

21 for part VII of subchapter B of chapter 1 of such Code 

22 is amended by redesignating the item relating to section 

23 224 as an item relating to section 225 and inserting before 

24 such item the following new item: 

‘‘Sec. 224. Costs of qualified health insurance.’’. 

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1 (d) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to taxable years beginning after 

3 December 31, 2008. 

4 SEC. 104. LIMITATION ON EMPLOYER DEDUCTION FOR 

5 GROUP HEALTH PLAN EXPENSES. 

6 (a) IN GENERAL.—Section 162 of the Internal Rev7 enue Code of 1986 is amended by redesignating subsection 

8 (q) as subsection (r) and by inserting after subsection (o) 

9 the following new subsection: 

10 ‘‘(q) LIMITATION ON DEDUCTION FOR GROUP

11 HEALTH PLAN EXPENSES.—The deduction allowed for 

12 any taxable year under this section for any amount paid 

13 or incurred in connection with a group health plan (as de14 fined in subsection (n)(3)) shall not exceed the sum of— 

15 ‘‘(1) $15,000 for each contract for family cov16 erage under such plan, and 

17 ‘‘(2) $7,500 for each contract for self-only cov18 erage under such plan.’’. 

19 (b) EFFECTIVE DATE.—The amendment made by 

20 this section shall apply to taxable years beginning after 

21 December 31, 2008. 

22 SEC. 105. EQUAL EMPLOYER CONTRIBUTION RULE TO PRO23 MOTE CHOICE. 

24 (a) EXCISE TAX FOR FAILURE TO PROVIDE CON25 TRIBUTION ELECTION.— 

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1 (1) IN GENERAL.—Chapter 47 of the Internal 

2 Revenue Code of 1986 is amended by inserting after 

3 section 5000 the following new section: 

4 ‘‘SEC. 5000A. HEALTH CARE CONTRIBUTION ELECTION. 

5 ‘‘(a) IMPOSITION OF TAX.—There is hereby imposed 

6 on any employer or employee organization that contributes 

7 to a group health plan and fails to meet the requirement 

8 of subsection (b) with respect to any individual eligible to 

9 participate in such plan (determined under the terms of 

10 the plan and without regard to the election described in 

11 subsection (b)) a tax equal to 3 times the contribution 

12 amount with respect to the individual. 

13 ‘‘(b) CONTRIBUTION ELECTION.—The requirement 

14 of this subsection is met with respect to any individual 

15 if such individual may elect to have the employer or em16 ployee organization pay an amount which is not less than 

17 the contribution amount to any provider of insurance 

18 (other than insurance described in section 36(e)(2)) which 

19 constitutes medical care of the individual or individual’s 

20 spouse or dependents in lieu of any group health plan cov21 erage otherwise provided or contributed to by the employer 

22 with respect to such individual. 

23 ‘‘(c) CONTRIBUTION AMOUNT.—For purposes of this 

24 section, the term ‘contribution amount’ means, with re25 spect to an individual under a group health plan, the pormstockstill on PROD1PC66 with BILLS

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1 tion of the applicable premium of such individual under 

2 such plan (as determined under section 4980B(f)(4)) 

3 which is not paid by the individual. 

4 ‘‘(d) GROUP HEALTH PLAN.—For purpose of this 

5 section, the term ‘group health plan’ has the meaning 

6 given to such term by section 5000(b)(1) and determined 

7 without regard to section 5000(d). 

8 ‘‘(e) APPLICATION TO FEHBP.—Notwithstanding 

9 any other provision of law, the Office of Personnel Man10 agement shall carry out the health benefits program under 

11 chapter 89 of title 5, United States Code, consistent with 

12 the requirements of this section.’’. 

13 (2) CLERICAL AMENDMENT.—The table of sec14 tions for chapter 47 of such Code is amended by in15 serting after the item relating to section 5000 the 

16 following new item: 

‘‘Sec. 5000A. Health care contribution election.’’. 

17 (b) REQUIREMENT OF EQUAL CONTRIBUTIONS TO

18 ALL FEHBP PLANS.—Section 8906 of title 5, United 

19 States Code, is amended by adding at the end the fol20 lowing new subsection: 

21 ‘‘(j) Notwithstanding the previous provisions of this 

22 section the Office of Personnel Management shall revise 

23 the amount of the Government contribution made under 

24 this section in a manner so that— 

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1 ‘‘(1) the amount of such contribution does not 

2 change based on the health benefits plan in which 

3 the individual is enrolled; and 

4 ‘‘(2) the aggregate amount of such contribu5 tions is estimated to be equal to the aggregate 

6 amount of such contributions if this subsection did 

7 not apply.’’. 

8 (c) ERISA CONFORMING AMENDMENT.—Section 

9 404 of the Employee Retirement Income Security Act of 

10 1974 (29 U.S.C. 1104) is amended by adding at the end 

11 the following new subsection: 

12 ‘‘(e) An employer which provides benefits to employ13 ees consisting of health insurance coverage, benefits other14 wise consisting of medical care, or both, shall not be treat15 ed as breaching any of the responsibilities, obligations, or 

16 duties imposed upon fiduciaries by this title in the case 

17 of one or more of such employees solely because of the 

18 extent to which the employer elects to provide, in the case 

19 of such one or more employees, some or all of such benefits 

20 by means of contributions made under an arrangement 

21 which is not a group health plan, irrespective of the extent 

22 to which the employer otherwise provides such benefits to 

23 employees under a group health plan. For purposes of this 

24 subsection, terms used in this subsection which are defined 

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1 in section 733 shall have the definitions provided such 

2 terms in such section.’’. 

3 TITLE II—QUALITY HEALTH4 CARE PROFESSIONALS COA5 LITION ACT 

6 SEC. 201. SHORT TITLE. 

7 This title may be cited as the ‘‘Quality Health-Care 

8 Coalition Act of 2007’’. 

9 SEC. 202. APPLICATION OF THE ANTITRUST LAWS TO 

10 HEALTH CARE PROFESSIONALS NEGOTI11 ATING WITH HEALTH PLANS. 

12 (a) IN GENERAL.—Any health care professionals who 

13 are engaged in negotiations with a health plan regarding 

14 the terms of any contract under which the professionals 

15 provide health care items or services for which benefits 

16 are provided under such plan shall, in connection with 

17 such negotiations, be entitled to the same treatment under 

18 the antitrust laws as the treatment to which bargaining 

19 units which are recognized under the National Labor Rela20 tions Act are entitled in connection with such collective 

21 bargaining. Such a professional shall, only in connection 

22 with such negotiations, be treated as an employee engaged 

23 in concerted activities and shall not be regarded as having 

24 the status of an employer, independent contractor, mana25 gerial employee, or supervisor. 

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1 (b) PROTECTION FOR GOOD FAITH ACTIONS.—Ac2 tions taken in good faith reliance on subsection (a) shall 

3 not be the subject under the antitrust laws of criminal 

4 sanctions nor of any civil damages, fees, or penalties be5 yond actual damages incurred. 

6 (c) LIMITATION.— 

7 (1) NO NEW RIGHT FOR COLLECTIVE CES8 SATION OF SERVICE.—The exemption provided in 

9 subsection (a) shall not confer any new right to par10 ticipate in any collective cessation of service to pa11 tients not already permitted by existing law. 

12 (2) NO CHANGE IN NATIONAL LABOR RELA13 TIONS ACT.—This section applies only to health care 

14 professionals excluded from the National Labor Re15 lations Act. Nothing in this section shall be con16 strued as changing or amending any provision of the 

17 National Labor Relations Act, or as affecting the 

18 status of any group of persons under that Act. 

19 (d) 5-YEAR SUNSET.—The exemption provided in 

20 subsection (a) shall only apply to conduct occurring during 

21 the 5-year period beginning on the date of the enactment 

22 of this Act and shall continue to apply for 1 year after 

23 the end of such period to contracts entered into before 

24 the end of such period. 

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1 (e) LIMITATION ON EXEMPTION.—Nothing in this 

2 section shall exempt from the application of the antitrust 

3 laws any agreement or otherwise unlawful conspiracy that 

4 excludes, limits the participation or reimbursement of, or 

5 otherwise limits the scope of services to be provided by 

6 any health care professional or group of health care pro7 fessionals with respect to the performance of services that 

8 are within their scope of practice as defined or permitted 

9 by relevant law or regulation. 

10 (f) NO EFFECT ON TITLE VI OF CIVIL RIGHTS ACT

11 OF 1964.—Nothing in this section shall be construed to 

12 affect the application of title VI of the Civil Rights Act 

13 of 1964. 

14 (g) NO APPLICATION TO FEDERAL PROGRAMS.— 

15 Nothing in this section shall apply to negotiations between 

16 health care professionals and health plans pertaining to 

17 benefits provided under any of the following: 

18 (1) The Medicare Program under title XVIII of 

19 the Social Security Act (42 U.S.C. 1395 et seq.). 

20 (2) The Medicaid Program under title XIX of 

21 the Social Security Act (42 U.S.C. 1396 et seq.). 

22 (3) The SCHIP program under title XXI of the 

23 Social Security Act (42 U.S.C. 1397aa et seq.). 

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1 (4) Chapter 55 of title 10, United States Code 

2 (relating to medical and dental care for members of 

3 the uniformed services). 

4 (5) Chapter 17 of title 38, United States Code 

5 (relating to Veterans’ medical care). 

6 (6) Chapter 89 of title 5, United States Code 

7 (relating to the Federal employees’ health benefits 

8 program). 

9 (7) The Indian Health Care Improvement Act 

10 (25 U.S.C. 1601 et seq.). 

11 (h) EXEMPTION OF ABORTION AND ABORTION SERV12 ICES.—Nothing in this section shall apply to negotiations 

13 specifically relating to requiring a health plan to cover 

14 abortion or abortion services. 

15 (i) GENERAL ACCOUNTING OFFICE STUDY AND RE16 PORT.—The Comptroller General of the United States 

17 shall conduct a study on the impact of enactment of this 

18 section during the 12-month period beginning with the 

19 fifth year of the 5-year period described in subsection (d). 

20 Not later than the end of such 12-month period the Comp21 troller General shall submit to Congress a report on such 

22 study and shall include in the report such recommenda23 tions on the extension of this section (and changes that 

24 should be made in making such extension) as the Comp25 troller General deems appropriate. 

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1 (j) DEFINITIONS.—For purposes of this section: 

2 (1) ANTITRUST LAWS.—The term ‘‘antitrust 

3 laws’’— 

4 (A) has the meaning given it in subsection 

5 (a) of the first section of the Clayton Act (15 

6 U.S.C. 12(a)), except that such term includes 

7 section 5 of the Federal Trade Commission Act 

8 (15 U.S.C. 45) to the extent such section 5 ap9 plies to unfair methods of competition; and 

10 (B) includes any State law similar to the 

11 laws referred to in subparagraph (A). 

12 (2) HEALTH PLAN AND RELATED TERMS.— 

13 (A) IN GENERAL.—The term ‘‘health plan’’ 

14 means a group health plan or a health insur15 ance issuer that is offering health insurance 

16 coverage. 

17 (B) HEALTH INSURANCE COVERAGE; 

18 HEALTH INSURANCE ISSUER.—The terms 

19 ‘‘health insurance coverage’’ and ‘‘health insur20 ance issuer’’ have the meanings given such 

21 terms under paragraphs (1) and (2), respec22 tively, of section 733(b) of the Employee Retire23 ment Income Security Act of 1974 (29 U.S.C. 

24 1191b(b)). 

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1 (C) GROUP HEALTH PLAN.—The term 

2 ‘‘group health plan’’ has the meaning given that 

3 term in section 733(a)(1) of the Employee Re4 tirement Income Security Act of 1974 (29 

5 U.S.C. 1191b(a)(1)). 

6 (3) HEALTH CARE PROFESSIONAL.—The term 

7 ‘‘health care professional’’ means an individual who 

8 provides health care items or services, treatment, as9 sistance with activities of daily living, or medications 

10 to patients and who, to the extent required by State 

11 or Federal law, possesses specialized training that 

12 confers expertise in the provision of such items or 

13 services, treatment, assistance, or medications. 

14 (k) SENSE OF THE CONGRESS.—It is the sense of 

15 the Congress that decisions regarding medical care and 

16 treatment should be made by the physician or health care 

17 professional in consultation with the patient. 

18 TITLE III—INTERSTATE MARKET 

19 FOR HEALTH INSURANCE 

20 SEC. 301. COOPERATIVE GOVERNING OF INDIVIDUAL 

21 HEALTH INSURANCE COVERAGE. 

22 (a) IN GENERAL.—Title XXVII of the Public Health 

23 Service Act (42 U.S.C. 300gg et seq.) is amended by add24 ing at the end the following new part: 

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1 ‘‘PART D—COOPERATIVE GOVERNING OF 

2 INDIVIDUAL HEALTH INSURANCE COVERAGE 

3 ‘‘SEC. 2795. DEFINITIONS. 

4 ‘‘In this part: 

5 ‘‘(1) PRIMARY STATE.—The term ‘primary 

6 State’ means, with respect to individual health insur7 ance coverage offered by a health insurance issuer, 

8 the State designated by the issuer as the State 

9 whose covered laws shall govern the health insurance 

10 issuer in the sale of such coverage under this part. 

11 An issuer, with respect to a particular policy, may 

12 only designate one such State as its primary State 

13 with respect to all such coverage it offers. Such an 

14 issuer may not change the designated primary State 

15 with respect to individual health insurance coverage 

16 once the policy is issued, except that such a change 

17 may be made upon renewal of the policy. With re18 spect to such designated State, the issuer is deemed 

19 to be doing business in that State. 

20 ‘‘(2) SECONDARY STATE.—The term ‘secondary 

21 State’ means, with respect to individual health insur22 ance coverage offered by a health insurance issuer, 

23 any State that is not the primary State. In the case 

24 of a health insurance issuer that is selling a policy 

25 in, or to a resident of, a secondary State, the issuer 

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1 is deemed to be doing business in that secondary 

2 State. 

3 ‘‘(3) HEALTH INSURANCE ISSUER.—The term 

4 ‘health insurance issuer’ has the meaning given such 

5 term in section 2791(b)(2), except that such an 

6 issuer must be licensed in the primary State and be 

7 qualified to sell individual health insurance coverage 

8 in that State. 

9 ‘‘(4) INDIVIDUAL HEALTH INSURANCE COV10 ERAGE.—The term ‘individual health insurance cov11 erage’ means health insurance coverage offered in 

12 the individual market, as defined in section 

13 2791(e)(1). 

14 ‘‘(5) APPLICABLE STATE AUTHORITY.—The 

15 term ‘applicable State authority’ means, with respect 

16 to a health insurance issuer in a State, the State in17 surance commissioner or official or officials des18 ignated by the State to enforce the requirements of 

19 this title for the State with respect to the issuer. 

20 ‘‘(6) HAZARDOUS FINANCIAL CONDITION.—The 

21 term ‘hazardous financial condition’ means that, 

22 based on its present or reasonably anticipated finan23 cial condition, a health insurance issuer is unlikely 

24 to be able— 

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1 ‘‘(A) to meet obligations to policyholders 

2 with respect to known claims and reasonably 

3 anticipated claims; or 

4 ‘‘(B) to pay other obligations in the normal 

5 course of business. 

6 ‘‘(7) COVERED LAWS.— 

7 ‘‘(A) IN GENERAL.—The term ‘covered 

8 laws’ means the laws, rules, regulations, agree9 ments, and orders governing the insurance busi10 ness pertaining to— 

11 ‘‘(i) individual health insurance cov12 erage issued by a health insurance issuer; 

13 ‘‘(ii) the offer, sale, rating (including 

14 medical underwriting), renewal, and 

15 issuance of individual health insurance cov16 erage to an individual; 

17 ‘‘(iii) the provision to an individual in 

18 relation to individual health insurance cov19 erage of health care and insurance related 

20 services; 

21 ‘‘(iv) the provision to an individual in 

22 relation to individual health insurance cov23 erage of management, operations, and in24 vestment activities of a health insurance 

25 issuer; and 

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1 ‘‘(v) the provision to an individual in 

2 relation to individual health insurance cov3 erage of loss control and claims adminis4 tration for a health insurance issuer with 

5 respect to liability for which the issuer pro6 vides insurance. 

7 ‘‘(B) EXCEPTION.—Such term does not in8 clude any law, rule, regulation, agreement, or 

9 order governing the use of care or cost manage10 ment techniques, including any requirement re11 lated to provider contracting, network access or 

12 adequacy, health care data collection, or quality 

13 assurance. 

14 ‘‘(8) STATE.—The term ‘State’ means only the 

15 50 States and the District of Columbia. 

16 ‘‘(9) UNFAIR CLAIMS SETTLEMENT PRAC17 TICES.—The term ‘unfair claims settlement prac18 tices’ means only the following practices: 

19 ‘‘(A) Knowingly misrepresenting to claim20 ants and insured individuals relevant facts or 

21 policy provisions relating to coverage at issue. 

22 ‘‘(B) Failing to acknowledge with reason23 able promptness pertinent communications with 

24 respect to claims arising under policies. 

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1 ‘‘(C) Failing to adopt and implement rea2 sonable standards for the prompt investigation 

3 and settlement of claims arising under policies. 

4 ‘‘(D) Failing to effectuate prompt, fair, 

5 and equitable settlement of claims submitted in 

6 which liability has become reasonably clear. 

7 ‘‘(E) Refusing to pay claims without con8 ducting a reasonable investigation. 

9 ‘‘(F) Failing to affirm or deny coverage of 

10 claims within a reasonable period of time after 

11 having completed an investigation related to 

12 those claims. 

13 ‘‘(G) A pattern or practice of compelling 

14 insured individuals or their beneficiaries to in15 stitute suits to recover amounts due under its 

16 policies by offering substantially less than the 

17 amounts ultimately recovered in suits brought 

18 by them. 

19 ‘‘(H) A pattern or practice of attempting 

20 to settle or settling claims for less than the 

21 amount that a reasonable person would believe 

22 the insured individual or his or her beneficiary 

23 was entitled by reference to written or printed 

24 advertising material accompanying or made 

25 part of an application. 

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1 ‘‘(I) Attempting to settle or settling claims 

2 on the basis of an application that was materi3 ally altered without notice to, or knowledge or 

4 consent of, the insured. 

5 ‘‘(J) Failing to provide forms necessary to 

6 present claims within 15 calendar days of a re7 quests with reasonable explanations regarding 

8 their use. 

9 ‘‘(K) Attempting to cancel a policy in less 

10 time than that prescribed in the policy or by the 

11 law of the primary State. 

12 ‘‘(10) FRAUD AND ABUSE.—The term ‘fraud 

13 and abuse’ means an act or omission committed by 

14 a person who, knowingly and with intent to defraud, 

15 commits, or conceals any material information con16 cerning, one or more of the following: 

17 ‘‘(A) Presenting, causing to be presented 

18 or preparing with knowledge or belief that it 

19 will be presented to or by an insurer, a rein20 surer, broker or its agent, false information as 

21 part of, in support of or concerning a fact ma22 terial to one or more of the following: 

23 ‘‘(i) An application for the issuance or 

24 renewal of an insurance policy or reinsur25 ance contract. 

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1 ‘‘(ii) The rating of an insurance policy 

2 or reinsurance contract. 

3 ‘‘(iii) A claim for payment or benefit 

4 pursuant to an insurance policy or reinsur5 ance contract. 

6 ‘‘(iv) Premiums paid on an insurance 

7 policy or reinsurance contract. 

8 ‘‘(v) Payments made in accordance 

9 with the terms of an insurance policy or 

10 reinsurance contract. 

11 ‘‘(vi) A document filed with the com12 missioner or the chief insurance regulatory 

13 official of another jurisdiction. 

14 ‘‘(vii) The financial condition of an in15 surer or reinsurer. 

16 ‘‘(viii) The formation, acquisition, 

17 merger, reconsolidation, dissolution or 

18 withdrawal from one or more lines of in19 surance or reinsurance in all or part of a 

20 State by an insurer or reinsurer. 

21 ‘‘(ix) The issuance of written evidence 

22 of insurance. 

23 ‘‘(x) The reinstatement of an insur24 ance policy. 

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1 ‘‘(B) Solicitation or acceptance of new or 

2 renewal insurance risks on behalf of an insurer 

3 reinsurer or other person engaged in the busi4 ness of insurance by a person who knows or 

5 should know that the insurer or other person 

6 responsible for the risk is insolvent at the time 

7 of the transaction. 

8 ‘‘(C) Transaction of the business of insur9 ance in violation of laws requiring a license, cer10 tificate of authority or other legal authority for 

11 the transaction of the business of insurance. 

12 ‘‘(D) Attempt to commit, aiding or abet13 ting in the commission of, or conspiracy to com14 mit the acts or omissions specified in this para15 graph. 

16 ‘‘SEC. 2796. APPLICATION OF LAW. 

17 ‘‘(a) IN GENERAL.—The covered laws of the primary 

18 State shall apply to individual health insurance coverage 

19 offered by a health insurance issuer in the primary State 

20 and in any secondary State, but only if the coverage and 

21 issuer comply with the conditions of this section with re22 spect to the offering of coverage in any secondary State. 

23 ‘‘(b) EXEMPTIONS FROM COVERED LAWS IN A SEC24 ONDARY STATE.—Except as provided in this section, a 

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1 ing (including medical underwriting), renewal, and 

2 issuance of individual health insurance coverage in any 

3 secondary State is exempt from any covered laws of the 

4 secondary State (and any rules, regulations, agreements, 

5 or orders sought or issued by such State under or related 

6 to such covered laws) to the extent that such laws would— 

7 ‘‘(1) make unlawful, or regulate, directly or in8 directly, the operation of the health insurance issuer 

9 operating in the secondary State, except that any 

10 secondary State may require such an issuer— 

11 ‘‘(A) to pay, on a nondiscriminatory basis, 

12 applicable premium and other taxes (including 

13 high risk pool assessments) which are levied on 

14 insurers and surplus lines insurers, brokers, or 

15 policyholders under the laws of the State; 

16 ‘‘(B) to register with and designate the 

17 State insurance commissioner as its agent solely 

18 for the purpose of receiving service of legal doc19 uments or process; 

20 ‘‘(C) to submit to an examination of its fi21 nancial condition by the State insurance com22 missioner in any State in which the issuer is 

23 doing business to determine the issuer’s finan24 cial condition, if— 

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1 ‘‘(i) the State insurance commissioner 

2 of the primary State has not done an ex3 amination within the period recommended 

4 by the National Association of Insurance 

5 Commissioners; and 

6 ‘‘(ii) any such examination is con7 ducted in accordance with the examiners’ 

8 handbook of the National Association of 

9 Insurance Commissioners and is coordi10 nated to avoid unjustified duplication and 

11 unjustified repetition; 

12 ‘‘(D) to comply with a lawful order 

13 issued— 

14 ‘‘(i) in a delinquency proceeding com15 menced by the State insurance commis16 sioner if there has been a finding of finan17 cial impairment under subparagraph (C); 

18 or 

19 ‘‘(ii) in a voluntary dissolution pro20 ceeding; 

21 ‘‘(E) to comply with an injunction issued 

22 by a court of competent jurisdiction, upon a pe23 tition by the State insurance commissioner al24 leging that the issuer is in hazardous financial 

25 condition; 

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1 ‘‘(F) to participate, on a nondiscriminatory 

2 basis, in any insurance insolvency guaranty as3 sociation or similar association to which a 

4 health insurance issuer in the State is required 

5 to belong; 

6 ‘‘(G) to comply with any State law regard7 ing fraud and abuse (as defined in section 

8 2795(10)), except that if the State seeks an in9 junction regarding the conduct described in this 

10 subparagraph, such injunction must be obtained 

11 from a court of competent jurisdiction; 

12 ‘‘(H) to comply with any State law regard13 ing unfair claims settlement practices (as de14 fined in section 2795(9)); or 

15 ‘‘(I) to comply with the applicable require16 ments for independent review under section 

17 2798 with respect to coverage offered in the 

18 State; 

19 ‘‘(2) require any individual health insurance 

20 coverage issued by the issuer to be countersigned by 

21 an insurance agent or broker residing in that Sec22 ondary State; or 

23 ‘‘(3) otherwise discriminate against the issuer 

24 issuing insurance in both the primary State and in 

25 any secondary State. 

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1 ‘‘(c) CLEAR AND CONSPICUOUS DISCLOSURE.—A 

2 health insurance issuer shall provide the following notice, 

3 in 12-point bold type, in any insurance coverage offered 

4 in a secondary State under this part by such a health in5 surance issuer and at renewal of the policy, with the 5 

6 blank spaces therein being appropriately filled with the 

7 name of the health insurance issuer, the name of primary 

8 State, the name of the secondary State, the name of the 

9 secondary State, and the name of the secondary State, re10 spectively, for the coverage concerned: 

11 This policy is issued by lllll and is governed by 

12 the laws and regulations of the State of lllll, and 

13 it has met all the laws of that State as determined by 

14 that State’s Department of Insurance. This policy may be 

15 less expensive than others because it is not subject to all 

16 of the insurance laws and regulations of the State of 

17 lllll, including coverage of some services or bene18 fits mandated by the law of the State of lllll. Ad19 ditionally, this policy is not subject to all of the consumer 

20 protection laws or restrictions on rate changes of the State 

21 of lllll. As with all insurance products, before pur22 chasing this policy, you should carefully review the policy 

23 and determine what health care services the policy covers 

24 and what benefits it provides, including any exclusions, 

25 limitations, or conditions for such services or benefits.’’. 

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1 ‘‘(d) PROHIBITION ON CERTAIN RECLASSIFICATIONS

2 AND PREMIUM INCREASES.— 

3 ‘‘(1) IN GENERAL.—For purposes of this sec4 tion, a health insurance issuer that provides indi5 vidual health insurance coverage to an individual 

6 under this part in a primary or secondary State may 

7 not upon renewal— 

8 ‘‘(A) move or reclassify the individual in9 sured under the health insurance coverage from 

10 the class such individual is in at the time of 

11 issue of the contract based on the health-status 

12 related factors of the individual; or 

13 ‘‘(B) increase the premiums assessed the 

14 individual for such coverage based on a health 

15 status-related factor or change of a health sta16 tus-related factor or the past or prospective 

17 claim experience of the insured individual. 

18 ‘‘(2) CONSTRUCTION.—Nothing in paragraph 

19 (1) shall be construed to prohibit a health insurance 

20 issuer— 

21 ‘‘(A) from terminating or discontinuing 

22 coverage or a class of coverage in accordance 

23 with subsections (b) and (c) of section 2742; 

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1 ‘‘(B) from raising premium rates for all 

2 policy holders within a class based on claims ex3 perience; 

4 ‘‘(C) from changing premiums or offering 

5 discounted premiums to individuals who engage 

6 in wellness activities at intervals prescribed by 

7 the issuer, if such premium changes or incen8 tives— 

9 ‘‘(i) are disclosed to the consumer in 

10 the insurance contract; 

11 ‘‘(ii) are based on specific wellness ac12 tivities that are not applicable to all indi13 viduals; and 

14 ‘‘(iii) are not obtainable by all individ15 uals to whom coverage is offered; 

16 ‘‘(D) from reinstating lapsed coverage; or 

17 ‘‘(E) from retroactively adjusting the rates 

18 charged an insured individual if the initial rates 

19 were set based on material misrepresentation by 

20 the individual at the time of issue. 

21 ‘‘(e) PRIOR OFFERING OF POLICY IN PRIMARY

22 STATE.—A health insurance issuer may not offer for sale 

23 individual health insurance coverage in a secondary State 

24 unless that coverage is currently offered for sale in the 

25 primary State. 

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1 ‘‘(f) LICENSING OF AGENTS OR BROKERS FOR

2 HEALTH INSURANCE ISSUERS.—Any State may require 

3 that a person acting, or offering to act, as an agent or 

4 broker for a health insurance issuer with respect to the 

5 offering of individual health insurance coverage obtain a 

6 license from that State, with commissions or other com7 pensation subject to the provisions of the laws of that 

8 State, except that a State may not impose any qualifica9 tion or requirement which discriminates against a non10 resident agent or broker. 

11 ‘‘(g) DOCUMENTS FOR SUBMISSION TO STATE IN12 SURANCE COMMISSIONER.—Each health insurance issuer 

13 issuing individual health insurance coverage in both pri14 mary and secondary States shall submit— 

15 ‘‘(1) to the insurance commissioner of each 

16 State in which it intends to offer such coverage, be17 fore it may offer individual health insurance cov18 erage in such State— 

19 ‘‘(A) a copy of the plan of operation or fea20 sibility study or any similar statement of the 

21 policy being offered and its coverage (which 

22 shall include the name of its primary State and 

23 its principal place of business); 

24 ‘‘(B) written notice of any change in its 

25 designation of its primary State; and 

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1 ‘‘(C) written notice from the issuer of the 

2 issuer’s compliance with all the laws of the pri3 mary State; and 

4 ‘‘(2) to the insurance commissioner of each sec5 ondary State in which it offers individual health in6 surance coverage, a copy of the issuer’s quarterly fi7 nancial statement submitted to the primary State, 

8 which statement shall be certified by an independent 

9 public accountant and contain a statement of opin10 ion on loss and loss adjustment expense reserves 

11 made by— 

12 ‘‘(A) a member of the American Academy 

13 of Actuaries; or 

14 ‘‘(B) a qualified loss reserve specialist. 

15 ‘‘(h) POWER OF COURTS TO ENJOIN CONDUCT.— 

16 Nothing in this section shall be construed to affect the 

17 authority of any Federal or State court to enjoin— 

18 ‘‘(1) the solicitation or sale of individual health 

19 insurance coverage by a health insurance issuer to 

20 any person or group who is not eligible for such in21 surance; or 

22 ‘‘(2) the solicitation or sale of individual health 

23 insurance coverage that violates the requirements of 

24 the law of a secondary State which are described in 

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1 subparagraphs (A) through (H) of section 

2 2796(b)(1). 

3 ‘‘(i) POWER OF SECONDARY STATES TO TAKE AD4 MINISTRATIVE ACTION.—Nothing in this section shall be 

5 construed to affect the authority of any State to enjoin 

6 conduct in violation of that State’s laws described in sec7 tion 2796(b)(1). 

8 ‘‘(j) STATE POWERS TO ENFORCE STATE LAWS.— 

9 ‘‘(1) IN GENERAL.—Subject to the provisions of 

10 subsection (b)(1)(G) (relating to injunctions) and 

11 paragraph (2), nothing in this section shall be con12 strued to affect the authority of any State to make 

13 use of any of its powers to enforce the laws of such 

14 State with respect to which a health insurance issuer 

15 is not exempt under subsection (b). 

16 ‘‘(2) COURTS OF COMPETENT JURISDICTION.— 

17 If a State seeks an injunction regarding the conduct 

18 described in paragraphs (1) and (2) of subsection 

19 (h), such injunction must be obtained from a Fed20 eral or State court of competent jurisdiction. 

21 ‘‘(k) STATES’ AUTHORITY TO SUE.—Nothing in this 

22 section shall affect the authority of any State to bring ac23 tion in any Federal or State court. 

24 ‘‘(l) GENERALLY APPLICABLE LAWS.—Nothing in 

25 this section shall be construed to affect the applicability 

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1 of State laws generally applicable to persons or corpora2 tions. 

3 ‘‘(m) GUARANTEED AVAILABILITY OF COVERAGE TO

4 HIPAA ELIGIBLE INDIVIDUALS.—To the extent that a 

5 health insurance issuer is offering coverage in a primary 

6 State that does not accommodate residents of secondary 

7 States or does not provide a working mechanism for resi8 dents of a secondary State, and the issuer is offering cov9 erage under this part in such secondary State which has 

10 not adopted a qualified high risk pool as its acceptable 

11 alternative mechanism (as defined in section 2744(c)(2)), 

12 the issuer shall, with respect to any individual health in13 surance coverage offered in a secondary State under this 

14 part, comply with the guaranteed availability requirements 

15 for eligible individuals in section 2741. 

16 ‘‘SEC. 2797. PRIMARY STATE MUST MEET FEDERAL FLOOR 

17 BEFORE ISSUER MAY SELL INTO SECONDARY 

18 STATES. 

19 ‘‘A health insurance issuer may not offer, sell, or 

20 issue individual health insurance coverage in a secondary 

21 State if the State insurance commissioner does not use 

22 a risk-based capital formula for the determination of cap23 ital and surplus requirements for all health insurance 

24 issuers. 

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1 ‘‘SEC. 2798. INDEPENDENT EXTERNAL APPEALS PROCE2 DURES. 

3 ‘‘(a) RIGHT TO EXTERNAL APPEAL.—A health insur4 ance issuer may not offer, sell, or issue individual health 

5 insurance coverage in a secondary State under the provi6 sions of this title unless—— 

7 ‘‘(1) both the secondary State and the primary 

8 State have legislation or regulations in place estab9 lishing an independent review process for individuals 

10 who are covered by individual health insurance cov11 erage, or 

12 ‘‘(2) in any case in which the requirements of 

13 subparagraph (A) are not met with respect to the ei14 ther of such States, the issuer provides an inde15 pendent review mechanism substantially identical (as 

16 determined by the applicable State authority of such 

17 State) to that prescribed in the ‘Health Carrier Ex18 ternal Review Model Act’ of the National Association 

19 of Insurance Commissioners for all individuals who 

20 purchase insurance coverage under the terms of this 

21 part, except that, under such mechanism, the review 

22 is conducted by an independent medical reviewer, or 

23 a panel of such reviewers, with respect to whom the 

24 requirements of subsection (b) are met. 

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1 ‘‘(b) QUALIFICATIONS OF INDEPENDENT MEDICAL

2 REVIEWERS.—In the case of any independent review 

3 mechanism referred to in subsection (a)(2)— 

4 ‘‘(1) IN GENERAL.—In referring a denial of a 

5 claim to an independent medical reviewer, or to any 

6 panel of such reviewers, to conduct independent 

7 medical review, the issuer shall ensure that— 

8 ‘‘(A) each independent medical reviewer 

9 meets the qualifications described in paragraphs 

10 (2) and (3); 

11 ‘‘(B) with respect to each review, each re12 viewer meets the requirements of paragraph (4) 

13 and the reviewer, or at least 1 reviewer on the 

14 panel, meets the requirements described in 

15 paragraph (5); and 

16 ‘‘(C) compensation provided by the issuer 

17 to each reviewer is consistent with paragraph 

18 (6). 

19 ‘‘(2) LICENSURE AND EXPERTISE.—Each inde20 pendent medical reviewer shall be a physician 

21 (allopathic or osteopathic) or health care profes22 sional who— 

23 ‘‘(A) is appropriately credentialed or li24 censed in 1 or more States to deliver health 

25 care services; and 

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1 ‘‘(B) typically treats the condition, makes 

2 the diagnosis, or provides the type of treatment 

3 under review. 

4 ‘‘(3) INDEPENDENCE.— 

5 ‘‘(A) IN GENERAL.—Subject to subpara6 graph (B), each independent medical reviewer 

7 in a case shall— 

8 ‘‘(i) not be a related party (as defined 

9 in paragraph (7)); 

10 ‘‘(ii) not have a material familial, fi11 nancial, or professional relationship with 

12 such a party; and 

13 ‘‘(iii) not otherwise have a conflict of 

14 interest with such a party (as determined 

15 under regulations). 

16 ‘‘(B) EXCEPTION.—Nothing in subpara17 graph (A) shall be construed to— 

18 ‘‘(i) prohibit an individual, solely on 

19 the basis of affiliation with the issuer, 

20 from serving as an independent medical re21 viewer if— 

22 ‘‘(I) a non-affiliated individual is 

23 not reasonably available; 

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1 ‘‘(II) the affiliated individual is 

2 not involved in the provision of items 

3 or services in the case under review; 

4 ‘‘(III) the fact of such an affili5 ation is disclosed to the issuer and the 

6 enrollee (or authorized representative) 

7 and neither party objects; and 

8 ‘‘(IV) the affiliated individual is 

9 not an employee of the issuer and 

10 does not provide services exclusively or 

11 primarily to or on behalf of the issuer; 

12 ‘‘(ii) prohibit an individual who has 

13 staff privileges at the institution where the 

14 treatment involved takes place from serv15 ing as an independent medical reviewer 

16 merely on the basis of such affiliation if 

17 the affiliation is disclosed to the issuer and 

18 the enrollee (or authorized representative), 

19 and neither party objects; or 

20 ‘‘(iii) prohibit receipt of compensation 

21 by an independent medical reviewer from 

22 an entity if the compensation is provided 

23 consistent with paragraph (6). 

24 ‘‘(4) PRACTICING HEALTH CARE PROFESSIONAL

25 IN SAME FIELD.— 

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1 ‘‘(A) IN GENERAL.—In a case involving 

2 treatment, or the provision of items or serv3 ices— 

4 ‘‘(i) by a physician, a reviewer shall be 

5 a practicing physician (allopathic or osteo6 pathic) of the same or similar specialty, as 

7 a physician who, acting within the appro8 priate scope of practice within the State in 

9 which the service is provided or rendered, 

10 typically treats the condition, makes the 

11 diagnosis, or provides the type of treat12 ment under review; or 

13 ‘‘(ii) by a non-physician health care 

14 professional, the reviewer, or at least 1 

15 member of the review panel, shall be a 

16 practicing non-physician health care pro17 fessional of the same or similar specialty 

18 as the non-physician health care profes19 sional who, acting within the appropriate 

20 scope of practice within the State in which 

21 the service is provided or rendered, typi22 cally treats the condition, makes the diag23 nosis, or provides the type of treatment 

24 under review. 

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1 ‘‘(B) PRACTICING DEFINED.—For pur2 poses of this paragraph, the term ‘practicing’ 

3 means, with respect to an individual who is a 

4 physician or other health care professional, that 

5 the individual provides health care services to 

6 individual patients on average at least 2 days 

7 per week. 

8 ‘‘(5) PEDIATRIC EXPERTISE.—In the case of an 

9 external review relating to a child, a reviewer shall 

10 have expertise under paragraph (2) in pediatrics. 

11 ‘‘(6) LIMITATIONS ON REVIEWER COMPENSA12 TION.—Compensation provided by the issuer to an 

13 independent medical reviewer in connection with a 

14 review under this section shall— 

15 ‘‘(A) not exceed a reasonable level; and 

16 ‘‘(B) not be contingent on the decision ren17 dered by the reviewer. 

18 ‘‘(7) RELATED PARTY DEFINED.—For purposes 

19 of this section, the term ‘related party’ means, with 

20 respect to a denial of a claim under a coverage relat21 ing to an enrollee, any of the following: 

22 ‘‘(A) The issuer involved, or any fiduciary, 

23 officer, director, or employee of the issuer. 

24 ‘‘(B) The enrollee (or authorized represent25 ative). 

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1 ‘‘(C) The health care professional that pro2 vides the items or services involved in the de3 nial. 

4 ‘‘(D) The institution at which the items or 

5 services (or treatment) involved in the denial 

6 are provided. 

7 ‘‘(E) The manufacturer of any drug or 

8 other item that is included in the items or serv9 ices involved in the denial. 

10 ‘‘(F) Any other party determined under 

11 any regulations to have a substantial interest in 

12 the denial involved. 

13 ‘‘(8) DEFINITIONS.—For purposes of this sub14 section: 

15 ‘‘(A) ENROLLEE.—The term ‘enrollee’ 

16 means, with respect to health insurance cov17 erage offered by a health insurance issuer, an 

18 individual enrolled with the issuer to receive 

19 such coverage. 

20 ‘‘(B) HEALTH CARE PROFESSIONAL.—The 

21 term ‘health care professional’ means an indi22 vidual who is licensed, accredited, or certified 

23 under State law to provide specified health care 

24 services and who is operating within the scope 

25 of such licensure, accreditation, or certification. 

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1 ‘‘SEC. 2799. ENFORCEMENT. 

2 ‘‘(a) IN GENERAL.—Subject to subsection (b), with 

3 respect to specific individual health insurance coverage the 

4 primary State for such coverage has sole jurisdiction to 

5 enforce the primary State’s covered laws in the primary 

6 State and any secondary State. 

7 ‘‘(b) SECONDARY STATE’S AUTHORITY.—Nothing in 

8 subsection (a) shall be construed to affect the authority 

9 of a secondary State to enforce its laws as set forth in 

10 the exception specified in section 2796(b)(1). 

11 ‘‘(c) COURT INTERPRETATION.—In reviewing action 

12 initiated by the applicable secondary State authority, the 

13 court of competent jurisdiction shall apply the covered 

14 laws of the primary State. 

15 ‘‘(d) NOTICE OF COMPLIANCE FAILURE.—In the case 

16 of individual health insurance coverage offered in a sec17 ondary State that fails to comply with the covered laws 

18 of the primary State, the applicable State authority of the 

19 secondary State may notify the applicable State authority 

20 of the primary State.’’. 

21 (b) EFFECTIVE DATE.—The amendment made by 

22 subsection (a) shall apply to individual health insurance 

23 coverage offered, issued, or sold after the date that is one 

24 year after the date of the enactment of this Act. 

25 (c) GAO ONGOING STUDY AND REPORTS.— 

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1 (1) STUDY.—The Comptroller General of the 

2 United States shall conduct an ongoing study con3 cerning the effect of the amendment made by sub4 section (a) on— 

5 (A) the number of uninsured and under-in6 sured; 

7 (B) the availability and cost of health in8 surance policies for individuals with pre-existing 

9 medical conditions; 

10 (C) the availability and cost of health in11 surance policies generally; 

12 (D) the elimination or reduction of dif13 ferent types of benefits under health insurance 

14 policies offered in different States; and 

15 (E) cases of fraud or abuse relating to 

16 health insurance coverage offered under such 

17 amendment and the resolution of such cases. 

18 (2) ANNUAL REPORTS.—The Comptroller Gen19 eral shall submit to Congress an annual report, after 

20 the end of each of the 5 years following the effective 

21 date of the amendment made by subsection (a), on 

22 the ongoing study conducted under paragraph (1). 

23 (d) SEVERABILITY.—If any provision of the section 

24 or the application of such provision to any person or cir25 cumstance is held to be unconstitutional, the remainder 

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1 of this section and the application of the provisions of such 

2 to any other person or circumstance shall not be affected. 

3 TITLE IV—HELP EFFICIENT, AC4 CESSIBLE, LOW-COST, TIMELY 

5 HEALTHCARE (HEALTH) ACT 

6 OF 2007 

7 SEC. 401. SHORT TITLE. 

8 This title may be cited as the ‘‘Help Efficient, Acces9 sible, Low-cost, Timely Healthcare (HEALTH) Act of 

10 2007’’. 

11 SEC. 402. FINDINGS AND PURPOSE. 

12 (a) FINDINGS.— 

13 (1) EFFECT ON HEALTH CARE ACCESS AND

14 COSTS.—Congress finds that our current civil justice 

15 system is adversely affecting patient access to health 

16 care services, better patient care, and cost-efficient 

17 health care, in that the health care liability system 

18 is a costly and ineffective mechanism for resolving 

19 claims of health care liability and compensating in20 jured patients, and is a deterrent to the sharing of 

21 information among health care professionals which 

22 impedes efforts to improve patient safety and quality 

23 of care. 

24 (2) EFFECT ON INTERSTATE COMMERCE.— 

25 Congress finds that the health care and insurance 

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1 industries are industries affecting interstate com2 merce and the health care liability litigation systems 

3 existing throughout the United States are activities 

4 that affect interstate commerce by contributing to 

5 the high costs of health care and premiums for 

6 health care liability insurance purchased by health 

7 care system providers. 

8 (3) EFFECT ON FEDERAL SPENDING.—Con9 gress finds that the health care liability litigation 

10 systems existing throughout the United States have 

11 a significant effect on the amount, distribution, and 

12 use of Federal funds because of— 

13 (A) the large number of individuals who 

14 receive health care benefits under programs op15 erated or financed by the Federal Government; 

16 (B) the large number of individuals who 

17 benefit because of the exclusion from Federal 

18 taxes of the amounts spent to provide them 

19 with health insurance benefits; and 

20 (C) the large number of health care pro21 viders who provide items or services for which 

22 the Federal Government makes payments. 

23 (b) PURPOSE.—It is the purpose of this title to imple24 ment reasonable, comprehensive, and effective health care 

25 liability reforms designed to— 

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1 (1) improve the availability of health care serv2 ices in cases in which health care liability actions 

3 have been shown to be a factor in the decreased 

4 availability of services; 

5 (2) reduce the incidence of ‘‘defensive medi6 cine’’ and lower the cost of health care liability in7 surance, all of which contribute to the escalation of 

8 health care costs; 

9 (3) ensure that persons with meritorious health 

10 care injury claims receive fair and adequate com11 pensation, including reasonable noneconomic dam12 ages; 

13 (4) improve the fairness and cost-effectiveness 

14 of our current health care liability system to resolve 

15 disputes over, and provide compensation for, health 

16 care liability by reducing uncertainty in the amount 

17 of compensation provided to injured individuals; and 

18 (5) provide an increased sharing of information 

19 in the health care system which will reduce unin20 tended injury and improve patient care. 

21 SEC. 403. ENCOURAGING SPEEDY RESOLUTION OF CLAIMS. 

22 The time for the commencement of a health care law23 suit shall be 3 years after the date of manifestation of 

24 injury or 1 year after the claimant discovers, or through 

25 the use of reasonable diligence should have discovered, the 

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1 injury, whichever occurs first. In no event shall the time 

2 for commencement of a health care lawsuit exceed 3 years 

3 after the date of manifestation of injury unless tolled for 

4 any of the following— 

5 (1) upon proof of fraud; 

6 (2) intentional concealment; or 

7 (3) the presence of a foreign body, which has no 

8 therapeutic or diagnostic purpose or effect, in the 

9 person of the injured person. Actions by a minor 

10 shall be commenced within 3 years from the date of 

11 the alleged manifestation of injury except that ac12 tions by a minor under the full age of 6 years shall 

13 be commenced within 3 years of manifestation of in14 jury or prior to the minor’s 8th birthday, whichever 

15 provides a longer period. Such time limitation shall 

16 be tolled for minors for any period during which a 

17 parent or guardian and a health care provider or 

18 health care organization have committed fraud or 

19 collusion in the failure to bring an action on behalf 

20 of the injured minor 

21 SEC. 404. COMPENSATING PATIENT INJURY. 

22 (a) UNLIMITED AMOUNT OF DAMAGES FOR ACTUAL

23 ECONOMIC LOSSES IN HEALTH CARE LAWSUITS.—In any 

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1 ant’s recovery of the full amount of the available economic 

2 damages, notwithstanding the limitation in subsection (b). 

3 (b) ADDITIONAL NONECONOMIC DAMAGES.—In any 

4 health care lawsuit, the amount of noneconomic damages, 

5 if available, may be as much as $250,000, regardless of 

6 the number of parties against whom the action is brought 

7 or the number of separate claims or actions brought with 

8 respect to the same injury. 

9 (c) NO DISCOUNT OF AWARD FOR NONECONOMIC

10 DAMAGES.—For purposes of applying the limitation in 

11 subsection (b), future noneconomic damages shall not be 

12 discounted to present value. The jury shall not be in13 formed about the maximum award for noneconomic dam14 ages. An award for noneconomic damages in excess of 

15 $250,000 shall be reduced either before the entry of judg16 ment, or by amendment of the judgment after entry of 

17 judgment, and such reduction shall be made before ac18 counting for any other reduction in damages required by 

19 law. If separate awards are rendered for past and future 

20 noneconomic damages and the combined awards exceed 

21 $250,000, the future noneconomic damages shall be re22 duced first. 

23 (d) FAIR SHARE RULE.—In any health care lawsuit, 

24 each party shall be liable for that party’s several share 

25 of any damages only and not for the share of any other 

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1 person. Each party shall be liable only for the amount of 

2 damages allocated to such party in direct proportion to 

3 such party’s percentage of responsibility. Whenever a 

4 judgment of liability is rendered as to any party, a sepa5 rate judgment shall be rendered against each such party 

6 for the amount allocated to such party. For purposes of 

7 this section, the trier of fact shall determine the propor8 tion of responsibility of each party for the claimant’s 

9 harm. 

10 SEC. 405. MAXIMIZING PATIENT RECOVERY. 

11 (a) COURT SUPERVISION OF SHARE OF DAMAGES

12 ACTUALLY PAID TO CLAIMANTS.—In any health care law13 suit, the court shall supervise the arrangements for pay14 ment of damages to protect against conflicts of interest 

15 that may have the effect of reducing the amount of dam16 ages awarded that are actually paid to claimants. In par17 ticular, in any health care lawsuit in which the attorney 

18 for a party claims a financial stake in the outcome by vir19 tue of a contingent fee, the court shall have the power 

20 to restrict the payment of a claimant’s damage recovery 

21 to such attorney, and to redirect such damages to the 

22 claimant based upon the interests of justice and principles 

23 of equity. In no event shall the total of all contingent fees 

24 for representing all claimants in a health care lawsuit ex25 ceed the following limits: 

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1 (1) 40 percent of the first $50,000 recovered by 

2 the claimant(s). 

(2) 331 3 ⁄3 percent of the next $50,000 recovered 

4 by the claimant(s). 

5 (3) 25 percent of the next $500,000 recovered 

6 by the claimant(s). 

7 (4) 15 percent of any amount by which the re8 covery by the claimant(s) is in excess of $600,000. 

9 (b) APPLICABILITY.—The limitations in this section 

10 shall apply whether the recovery is by judgment, settle11 ment, mediation, arbitration, or any other form of alter12 native dispute resolution. In a health care lawsuit involv13 ing a minor or incompetent person, a court retains the 

14 authority to authorize or approve a fee that is less than 

15 the maximum permitted under this section. The require16 ment for court supervision in the first two sentences of 

17 subsection (a) applies only in civil actions. 

18 SEC. 406. ADDITIONAL HEALTH BENEFITS. 

19 In any health care lawsuit involving injury or wrong20 ful death, any party may introduce evidence of collateral 

21 source benefits. If a party elects to introduce such evi22 dence, any opposing party may introduce evidence of any 

23 amount paid or contributed or reasonably likely to be paid 

24 or contributed in the future by or on behalf of the oppos25 ing party to secure the right to such collateral source benemstockstill on PROD1PC66 with BILLS

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1 fits. No provider of collateral source benefits shall recover 

2 any amount against the claimant or receive any lien or 

3 credit against the claimant’s recovery or be equitably or 

4 legally subrogated to the right of the claimant in a health 

5 care lawsuit involving injury or wrongful death. This sec6 tion shall apply to any health care lawsuit that is settled 

7 as well as a health care lawsuit that is resolved by a fact 

8 finder. This section shall not apply to section 1862(b) (42 

9 U.S.C. 1395y(b)) or section 1902(a)(25) (42 U.S.C. 

10 1396a(a)(25)) of the Social Security Act. 

11 SEC. 407. PUNITIVE DAMAGES. 

12 (a) IN GENERAL.—Punitive damages may, if other13 wise permitted by applicable State or Federal law, be 

14 awarded against any person in a health care lawsuit only 

15 if it is proven by clear and convincing evidence that such 

16 person acted with malicious intent to injure the claimant, 

17 or that such person deliberately failed to avoid unneces18 sary injury that such person knew the claimant was sub19 stantially certain to suffer. In any health care lawsuit 

20 where no judgment for compensatory damages is rendered 

21 against such person, no punitive damages may be awarded 

22 with respect to the claim in such lawsuit. No demand for 

23 punitive damages shall be included in a health care lawsuit 

24 as initially filed. A court may allow a claimant to file an 

25 amended pleading for punitive damages only upon a momstockstill on PROD1PC66 with BILLS

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1 tion by the claimant and after a finding by the court, upon 

2 review of supporting and opposing affidavits or after a 

3 hearing, after weighing the evidence, that the claimant has 

4 established by a substantial probability that the claimant 

5 will prevail on the claim for punitive damages. At the re6 quest of any party in a health care lawsuit, the trier of 

7 fact shall consider in a separate proceeding— 

8 (1) whether punitive damages are to be award9 ed and the amount of such award; and 

10 (2) the amount of punitive damages following a 

11 determination of punitive liability. 

12 If a separate proceeding is requested, evidence relevant 

13 only to the claim for punitive damages, as determined by 

14 applicable State law, shall be inadmissible in any pro15 ceeding to determine whether compensatory damages are 

16 to be awarded. 

17 (b) DETERMINING AMOUNT OF PUNITIVE DAM18 AGES.— 

19 (1) FACTORS CONSIDERED.—In determining 

20 the amount of punitive damages, if awarded, in a 

21 health care lawsuit, the trier of fact shall consider 

22 only the following— 

23 (A) the severity of the harm caused by the 

24 conduct of such party; 

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1 (B) the duration of the conduct or any 

2 concealment of it by such party; 

3 (C) the profitability of the conduct to such 

4 party; 

5 (D) the number of products sold or med6 ical procedures rendered for compensation, as 

7 the case may be, by such party, of the kind 

8 causing the harm complained of by the claim9 ant; 

10 (E) any criminal penalties imposed on such 

11 party, as a result of the conduct complained of 

12 by the claimant; and 

13 (F) the amount of any civil fines assessed 

14 against such party as a result of the conduct 

15 complained of by the claimant. 

16 (2) MAXIMUM AWARD.—The amount of punitive 

17 damages, if awarded, in a health care lawsuit may 

18 be as much as $250,000 or as much as two times 

19 the amount of economic damages awarded, which20 ever is greater. The jury shall not be informed of 

21 this limitation. 

22 (c) NO PUNITIVE DAMAGES FOR PRODUCTS THAT

23 COMPLY WITH FDA STANDARDS.— 

24 (1) IN GENERAL.— 

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1 (A) No punitive damages may be awarded 

2 against the manufacturer or distributor of a 

3 medical product, or a supplier of any compo4 nent or raw material of such medical product, 

5 based on a claim that such product caused the 

6 claimant’s harm where— 

7 (i)(I) such medical product was sub8 ject to premarket approval, clearance, or li9 censure by the Food and Drug Administra10 tion with respect to the safety of the for11 mulation or performance of the aspect of 

12 such medical product which caused the 

13 claimant’s harm or the adequacy of the 

14 packaging or labeling of such medical 

15 product; and 

16 (II) such medical product was so ap17 proved, cleared, or licensed; or 

18 (ii) such medical product is generally 

19 recognized among qualified experts as safe 

20 and effective pursuant to conditions estab21 lished by the Food and Drug Administra22 tion and applicable Food and Drug Admin23 istration regulations, including without 

24 limitation those related to packaging and 

25 labeling, unless the Food and Drug Adminmstockstill on PROD1PC66 with BILLS

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1 istration has determined that such medical 

2 product was not manufactured or distrib3 uted in substantial compliance with appli4 cable Food and Drug Administration stat5 utes and regulations. 

6 (B) RULE OF CONSTRUCTION.—Subpara7 graph (A) may not be construed as establishing 

8 the obligation of the Food and Drug Adminis9 tration to demonstrate affirmatively that a 

10 manufacturer, distributor, or supplier referred 

11 to in such subparagraph meets any of the con12 ditions described in such subparagraph. 

13 (2) LIABILITY OF HEALTH CARE PROVIDERS.— 

14 A health care provider who prescribes, or who dis15 penses pursuant to a prescription, a medical product 

16 approved, licensed, or cleared by the Food and Drug 

17 Administration shall not be named as a party to a 

18 product liability lawsuit involving such product and 

19 shall not be liable to a claimant in a class action 

20 lawsuit against the manufacturer, distributor, or 

21 seller of such product. Nothing in this paragraph 

22 prevents a court from consolidating cases involving 

23 health care providers and cases involving products li24 ability claims against the manufacturer, distributor, 

25 or product seller of such medical product. 

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1 (3) PACKAGING.—In a health care lawsuit for 

2 harm which is alleged to relate to the adequacy of 

3 the packaging or labeling of a drug which is required 

4 to have tamper-resistant packaging under regula5 tions of the Secretary of Health and Human Serv6 ices (including labeling regulations related to such 

7 packaging), the manufacturer or product seller of 

8 the drug shall not be held liable for punitive dam9 ages unless such packaging or labeling is found by 

10 the trier of fact by clear and convincing evidence to 

11 be substantially out of compliance with such regula12 tions. 

13 (4) EXCEPTION.—Paragraph (1) shall not 

14 apply in any health care lawsuit in which— 

15 (A) a person, before or after premarket ap16 proval, clearance, or licensure of such medical 

17 product, knowingly misrepresented to or with18 held from the Food and Drug Administration 

19 information that is required to be submitted 

20 under the Federal Food, Drug, and Cosmetic 

21 Act (21 U.S.C. 301 et seq.) or section 351 of 

22 the Public Health Service Act (42 U.S.C. 262) 

23 that is material and is causally related to the 

24 harm which the claimant allegedly suffered; or 

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1 (B) a person made an illegal payment to 

2 an official of the Food and Drug Administra3 tion for the purpose of either securing or main4 taining approval, clearance, or licensure of such 

5 medical product. 

6 SEC. 408. AUTHORIZATION OF PAYMENT OF FUTURE DAM7 AGES TO CLAIMANTS IN HEALTH CARE LAW8 SUITS. 

9 (a) IN GENERAL.—In any health care lawsuit, if an 

10 award of future damages, without reduction to present 

11 value, equaling or exceeding $50,000 is made against a 

12 party with sufficient insurance or other assets to fund a 

13 periodic payment of such a judgment, the court shall, at 

14 the request of any party, enter a judgment ordering that 

15 the future damages be paid by periodic payments. In any 

16 health care lawsuit, the court may be guided by the Uni17 form Periodic Payment of Judgments Act promulgated by 

18 the National Conference of Commissioners on Uniform 

19 State Laws. 

20 (b) APPLICABILITY.—This section applies to all ac21 tions which have not been first set for trial or retrial be22 fore the effective date of this title. 

23 SEC. 409. DEFINITIONS. 

24 In this title: 

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1 (1) ALTERNATIVE DISPUTE RESOLUTION SYS2 TEM; ADR.—The term ‘‘alternative dispute resolution 

3 system’’ or ‘‘ADR’’ means a system that provides 

4 for the resolution of health care lawsuits in a man5 ner other than through a civil action brought in a 

6 State or Federal court. 

7 (2) CLAIMANT.—The term ‘‘claimant’’ means 

8 any person who brings a health care lawsuit, includ9 ing a person who asserts or claims a right to legal 

10 or equitable contribution, indemnity or subrogation, 

11 arising out of a health care liability claim or action, 

12 and any person on whose behalf such a claim is as13 serted or such an action is brought, whether de14 ceased, incompetent, or a minor. 

15 (3) COLLATERAL SOURCE BENEFITS.—The 

16 term ‘‘collateral source benefits’’ means any amount 

17 paid or reasonably likely to be paid in the future to 

18 or on behalf of the claimant, or any service, product 

19 or other benefit provided or reasonably likely to be 

20 provided in the future to or on behalf of the claim21 ant, as a result of the injury or wrongful death, pur22 suant to— 

23 (A) any State or Federal health, sickness, 

24 income-disability, accident, or workers’ com25 pensation law; 

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1 (B) any health, sickness, income-disability, 

2 or accident insurance that provides health bene3 fits or income-disability coverage; 

4 (C) any contract or agreement of any 

5 group, organization, partnership, or corporation 

6 to provide, pay for, or reimburse the cost of 

7 medical, hospital, dental, or income disability 

8 benefits; and 

9 (D) any other publicly or privately funded 

10 program. 

11 (4) COMPENSATORY DAMAGES.—The term 

12 ‘‘compensatory damages’’ means objectively 

13 verifiable monetary losses incurred as a result of the 

14 provision of, use of, or payment for (or failure to 

15 provide, use, or pay for) health care services or med16 ical products, such as past and future medical ex17 penses, loss of past and future earnings, cost of ob18 taining domestic services, loss of employment, and 

19 loss of business or employment opportunities, dam20 ages for physical and emotional pain, suffering, in21 convenience, physical impairment, mental anguish, 

22 disfigurement, loss of enjoyment of life, loss of soci23 ety and companionship, loss of consortium (other 

24 than loss of domestic service), hedonic damages, in25 jury to reputation, and all other nonpecuniary losses 

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1 of any kind or nature. The term ‘‘compensatory 

2 damages’’ includes economic damages and non3 economic damages, as such terms are defined in this 

4 section. 

5 (5) CONTINGENT FEE.—The term ‘‘contingent 

6 fee’’ includes all compensation to any person or per7 sons which is payable only if a recovery is effected 

8 on behalf of one or more claimants. 

9 (6) ECONOMIC DAMAGES.—The term ‘‘economic 

10 damages’’ means objectively verifiable monetary 

11 losses incurred as a result of the provision of, use 

12 of, or payment for (or failure to provide, use, or pay 

13 for) health care services or medical products, such as 

14 past and future medical expenses, loss of past and 

15 future earnings, cost of obtaining domestic services, 

16 loss of employment, and loss of business or employ17 ment opportunities. 

18 (7) HEALTH CARE LAWSUIT.—The term 

19 ‘‘health care lawsuit’’ means any health care liability 

20 claim concerning the provision of health care goods 

21 or services or any medical product affecting inter22 state commerce, or any health care liability action 

23 concerning the provision of health care goods or 

24 services or any medical product affecting interstate 

25 commerce, brought in a State or Federal court or 

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1 pursuant to an alternative dispute resolution system, 

2 against a health care provider, a health care organi3 zation, or the manufacturer, distributor, supplier, 

4 marketer, promoter, or seller of a medical product, 

5 regardless of the theory of liability on which the 

6 claim is based, or the number of claimants, plain7 tiffs, defendants, or other parties, or the number of 

8 claims or causes of action, in which the claimant al9 leges a health care liability claim. Such term does 

10 not include a claim or action which is based on 

11 criminal liability; which seeks civil fines or penalties 

12 paid to Federal, State, or local government; or which 

13 is grounded in antitrust. 

14 (8) HEALTH CARE LIABILITY ACTION.—The 

15 term ‘‘health care liability action’’ means a civil ac16 tion brought in a State or Federal Court or pursu17 ant to an alternative dispute resolution system, 

18 against a health care provider, a health care organi19 zation, or the manufacturer, distributor, supplier, 

20 marketer, promoter, or seller of a medical product, 

21 regardless of the theory of liability on which the 

22 claim is based, or the number of plaintiffs, defend23 ants, or other parties, or the number of causes of ac24 tion, in which the claimant alleges a health care li25 ability claim. 

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1 (9) HEALTH CARE LIABILITY CLAIM.—The 

2 term ‘‘health care liability claim’’ means a demand 

3 by any person, whether or not pursuant to ADR, 

4 against a health care provider, health care organiza5 tion, or the manufacturer, distributor, supplier, mar6 keter, promoter, or seller of a medical product, in7 cluding, but not limited to, third-party claims, cross8 claims, counter-claims, or contribution claims, which 

9 are based upon the provision of, use of, or payment 

10 for (or the failure to provide, use, or pay for) health 

11 care services or medical products, regardless of the 

12 theory of liability on which the claim is based, or the 

13 number of plaintiffs, defendants, or other parties, or 

14 the number of causes of action. 

15 (10) HEALTH CARE ORGANIZATION.—The term 

16 ‘‘health care organization’’ means any person or en17 tity which is obligated to provide or pay for health 

18 benefits under any health plan, including any person 

19 or entity acting under a contract or arrangement 

20 with a health care organization to provide or admin21 ister any health benefit. 

22 (11) HEALTH CARE PROVIDER.—The term 

23 ‘‘health care provider’’ means any person or entity 

24 required by State or Federal laws or regulations to 

25 be licensed, registered, or certified to provide health 

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1 care services, and being either so licensed, reg2 istered, or certified, or exempted from such require3 ment by other statute or regulation. 

4 (12) HEALTH CARE GOODS OR SERVICES.—The 

5 term ‘‘health care goods or services’’ means any 

6 goods or services provided by a health care organiza7 tion, provider, or by any individual working under 

8 the supervision of a health care provider, that relates 

9 to the diagnosis, prevention, or treatment of any 

10 human disease or impairment, or the assessment or 

11 care of the health of human beings. 

12 (13) MALICIOUS INTENT TO INJURE.—The 

13 term ‘‘malicious intent to injure’’ means inten14 tionally causing or attempting to cause physical in15 jury other than providing health care goods or serv16 ices. 

17 (14) MEDICAL PRODUCT.—The term ‘‘medical 

18 product’’ means a drug, device, or biological product 

19 intended for humans, and the terms ‘‘drug’’, ‘‘de20 vice’’, and ‘‘biological product’’ have the meanings 

21 given such terms in sections 201(g)(1) and 201(h) 

22 of the Federal Food, Drug and Cosmetic Act (21 

23 U.S.C. 321) and section 351(a) of the Public Health 

24 Service Act (42 U.S.C. 262(a)), respectively, includmstockstill on PROD1PC66 with BILLS

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1 ing any component or raw material used therein, but 

2 excluding health care services. 

3 (15) NONECONOMIC DAMAGES.—The term 

4 ‘‘noneconomic damages’’ means damages for phys5 ical and emotional pain, suffering, inconvenience, 

6 physical impairment, mental anguish, disfigurement, 

7 loss of enjoyment of life, loss of society and compan8 ionship, loss of consortium (other than loss of do9 mestic service), hedonic damages, injury to reputa10 tion, and all other nonpecuniary losses of any kind 

11 or nature. 

12 (16) PUNITIVE DAMAGES.—The term ‘‘punitive 

13 damages’’ means damages awarded, for the purpose 

14 of punishment or deterrence, and not solely for com15 pensatory purposes, against a health care provider, 

16 health care organization, or a manufacturer, dis17 tributor, or supplier of a medical product. Punitive 

18 damages are neither economic nor noneconomic 

19 damages. 

20 (17) RECOVERY.—The term ‘‘recovery’’ means 

21 the net sum recovered after deducting any disburse22 ments or costs incurred in connection with prosecu23 tion or settlement of the claim, including all costs 

24 paid or advanced by any person. Costs of health care 

25 incurred by the plaintiff and the attorneys’ office 

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1 overhead costs or charges for legal services are not 

2 deductible disbursements or costs for such purpose. 

3 (18) STATE.—The term ‘‘State’’ means each of 

4 the several States, the District of Columbia, the 

5 Commonwealth of Puerto Rico, the Virgin Islands, 

6 Guam, American Samoa, the Northern Mariana Is7 lands, the Trust Territory of the Pacific Islands, and 

8 any other territory or possession of the United 

9 States, or any political subdivision thereof. 

10 SEC. 410. EFFECT ON OTHER LAWS. 

11 (a) VACCINE INJURY.— 

12 (1) To the extent that title XXI of the Public 

13 Health Service Act establishes a Federal rule of law 

14 applicable to a civil action brought for a vaccine-re15 lated injury or death— 

16 (A) this title does not affect the application 

17 of the rule of law to such an action; and 

18 (B) any rule of law prescribed by this title 

19 in conflict with a rule of law of such title XXI 

20 shall not apply to such action. 

21 (2) If there is an aspect of a civil action 

22 brought for a vaccine-related injury or death to 

23 which a Federal rule of law under title XXI of the 

24 Public Health Service Act does not apply, then this 

25 title or otherwise applicable law (as determined 

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1 under this title) will apply to such aspect of such ac2 tion. 

3 (b) OTHER FEDERAL LAW.—Except as provided in 

4 this section, nothing in this title shall be deemed to affect 

5 any defense available to a defendant in a health care law6 suit or action under any other provision of Federal law. 

7 SEC. 411. STATE FLEXIBILITY AND PROTECTION OF 

8 STATES’ RIGHTS. 

9 (a) HEALTH CARE LAWSUITS.—The provisions gov10 erning health care lawsuits set forth in this title preempt, 

11 subject to subsections (b) and (c), State law to the extent 

12 that State law prevents the application of any provisions 

13 of law established by or under this title. The provisions 

14 governing health care lawsuits set forth in this title super15 sede chapter 171 of title 28, United States Code, to the 

16 extent that such chapter— 

17 (1) provides for a greater amount of damages 

18 or contingent fees, a longer period in which a health 

19 care lawsuit may be commenced, or a reduced appli20 cability or scope of periodic payment of future dam21 ages, than provided in this title; or 

22 (2) prohibits the introduction of evidence re23 garding collateral source benefits, or mandates or 

24 permits subrogation or a lien on collateral source 

25 benefits. 

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1 (b) PROTECTION OF STATES’ RIGHTS AND OTHER

2 LAWS.—(1) Any issue that is not governed by any provi3 sion of law established by or under this title (including 

4 State standards of gross negligence) shall be governed by 

5 otherwise applicable State or Federal law. 

6 (2) This title shall not preempt or supersede any 

7 State or Federal law that imposes greater procedural or 

8 substantive protections for health care providers and 

9 health care organizations from liability, loss, or damages 

10 than those provided by this title or create a cause of ac11 tion. 

12 (c) STATE FLEXIBILITY.—No provision of this title 

13 shall be construed to preempt— 

14 (1) any State law (whether effective before, on, 

15 or after the date of the enactment of this title) that 

16 specifies a particular monetary amount of compen17 satory or punitive damages (or the total amount of 

18 damages) that may be awarded in a health care law19 suit, regardless of whether such monetary amount is 

20 greater or lesser than is provided for under this title, 

21 notwithstanding section 4(a); or 

22 (2) any defense available to a party in a health 

23 care lawsuit under any other provision of State or 

24 Federal law. 

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1 SEC. 412. APPLICABILITY; EFFECTIVE DATE. 

2 The previous provisions of this title shall apply to any 

3 health care lawsuit brought in a Federal or State court, 

4 or subject to an alternative dispute resolution system, that 

5 is initiated on or after the date of the enactment of this 

6 title, except that any health care lawsuit arising from an 

7 injury occurring prior to the date of the enactment of this 

8 title shall be governed by the applicable statute of limita9 tions provisions in effect at the time the injury occurred. 

10 SEC. 413. SENSE OF CONGRESS. 

11 It is the sense of Congress that a health insurer 

12 should be liable for damages for harm caused when it 

13 makes a decision as to what care is medically necessary 

14 and appropriate. 

15 SEC. 414. STATE GRANTS TO CREATE ADMINISTRATIVE 

16 HEALTH CARE TRIBUNALS. 

17 Part P of title III of the Public Health Service Act 

18 (42 U.S.C. 280g et seq.) is amended by adding at the end 

19 the following: 

20 ‘‘SEC. 399R. STATE GRANTS TO CREATE ADMINISTRATIVE 

21 HEALTH CARE TRIBUNALS. 

22 ‘‘(a) IN GENERAL.—The Secretary may award grants 

23 to States for the development, implementation, and eval24 uation of administrative health care tribunals that comply 

25 with this section, for the resolution of disputes concerning 

26 injuries allegedly caused by health care providers. 

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1 ‘‘(b) CONDITIONS FOR DEMONSTRATION GRANTS.— 

2 To be eligible to receive a grant under this section, a State 

3 shall submit to the Secretary an application at such time, 

4 in such manner, and containing such information as may 

5 be required by the Secretary. A grant shall be awarded 

6 under this section on such terms and conditions as the 

7 Secretary determines appropriate. 

8 ‘‘(c) REPRESENTATION BY COUNSEL.—A State that 

9 receives a grant under this section may not preclude any 

10 party to a dispute before an administrative health care tri11 bunal operated under such grant from obtaining legal rep12 resentation during any review by the expert panel under 

13 subsection (d), the administrative health care tribunal 

14 under subsection (e), or a State court under subsection 

15 (f). 

16 ‘‘(d) EXPERT PANEL REVIEW AND EARLY OFFER

17 GUIDELINES.— 

18 ‘‘(1) IN GENERAL.—Prior to the submission of 

19 any dispute concerning injuries allegedly caused by 

20 health care providers to an administrative health 

21 care tribunal under this section, such allegations 

22 shall first be reviewed by an expert panel. 

23 ‘‘(2) COMPOSITION.— 

24 ‘‘(A) IN GENERAL.—The members of each 

25 expert panel under this subsection appointed by 

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1 the head of the State agency responsible for 

2 health. At least one-half of such members shall 

3 be medical experts (either physicians or health 

4 care professionals). 

5 ‘‘(B) LICENSURE AND EXPERTISE.—Each 

6 physician or health care professional appointed 

7 to an expert panel under subparagraph (A) 

8 shall— 

9 ‘‘(i) be appropriately credentialed or 

10 licensed in 1 or more States to deliver 

11 health care services; and 

12 ‘‘(ii) typically treat the condition, 

13 make the diagnosis, or provide the type of 

14 treatment that is under review. 

15 ‘‘(C) INDEPENDENCE.— 

16 ‘‘(i) IN GENERAL.—Subject to clause 

17 (ii), each individual appointed to an expert 

18 panel under this paragraph shall— 

19 ‘‘(I) not have a material familial, 

20 financial, or professional relationship 

21 with a party involved in the dispute 

22 reviewed by the panel; and 

23 ‘‘(II) not otherwise have a con24 flict of interest with such a party. 

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1 ‘‘(ii) EXCEPTION.—Nothing in clause 

2 (i) shall be construed to prohibit an indi3 vidual who has staff privileges at an insti4 tution where the treatment involved in the 

5 dispute was provided from serving as a 

6 member of an expert panel merely on the 

7 basis of such affiliation, if the affiliation is 

8 disclosed to the parties and neither party 

9 objects. 

10 ‘‘(D) PRACTICING HEALTH CARE PROFES11 SIONAL IN SAME FIELD.— 

12 ‘‘(i) IN GENERAL.—In a dispute be13 fore an expert panel that involves treat14 ment, or the provision of items or serv15 ices— 

16 ‘‘(I) by a physician, the medical 

17 experts on the expert panel shall be 

18 practicing physicians (allopathic or os19 teopathic) of the same or similar spe20 cialty as a physician who typically 

21 treats the condition, makes the diag22 nosis, or provides the type of treat23 ment under review; or 

24 ‘‘(II) by a health care profes25 sional other than a physician, at least 

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1 two medical experts on the expert 

2 panel shall be practicing physicians 

3 (allopathic or osteopathic) of the same 

4 or similar specialty as the health care 

5 professional who typically treats the 

6 condition, makes the diagnosis, or 

7 provides the type of treatment under 

8 review, and, if determined appropriate 

9 by the State agency, the third medical 

10 expert shall be a practicing health 

11 care professional (other than such a 

12 physician) of such a same or similar 

13 specialty. 

14 ‘‘(ii) PRACTICING DEFINED.—In this 

15 paragraph, the term ‘practicing’ means, 

16 with respect to an individual who is a phy17 sician or other health care professional, 

18 that the individual provides health care 

19 services to individual patients on average 

20 at least 2 days a week. 

21 ‘‘(E) PEDIATRIC EXPERTISE.—In the case 

22 of dispute relating to a child, at least 1 medical 

23 expert on the expert panel shall have expertise 

24 described in subparagraph (D)(i) in pediatrics. 

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1 ‘‘(3) DETERMINATION.—After a review under 

2 paragraph (1), an expert panel shall make a deter3 mination as to the liability of the parties involved 

4 and compensation. 

5 ‘‘(4) ACCEPTANCE.—If the parties to a dispute 

6 before an expert panel under this subsection accept 

7 the determination of the expert panel concerning li8 ability and compensation, such compensation shall 

9 be paid to the claimant and the claimant shall agree 

10 to forgo any further action against the health care 

11 providers involved. 

12 ‘‘(5) FAILURE TO ACCEPT.—If any party de13 cides not to accept the expert panel’s determination, 

14 the matter shall be referred to an administrative 

15 health care tribunal created pursuant to this section. 

16 ‘‘(e) ADMINISTRATIVE HEALTH CARE TRIBUNALS.— 

17 ‘‘(1) IN GENERAL.—Upon the failure of any 

18 party to accept the determination of an expert panel 

19 under subsection (d), the parties shall have the right 

20 to request a hearing concerning the liability or com21 pensation involved by an administrative health care 

22 tribunal established by the State involved. 

23 ‘‘(2) REQUIREMENTS.—In establishing an ad24 ministrative health care tribunal under this section, 

25 a State shall— 

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1 ‘‘(A) ensure that such tribunals are pre2 sided over by special judges with health care ex3 pertise; 

4 ‘‘(B) provide authority to such judges to 

5 make binding rulings, rendered in written deci6 sions, on standards of care, causation, com7 pensation, and related issues with reliance on 

8 independent expert witnesses commissioned by 

9 the tribunal; 

10 ‘‘(C) establish gross negligence as the legal 

11 standard for the tribunal; 

12 ‘‘(D) allow the admission into evidence of 

13 the recommendation made by the expert panel 

14 under subsection (d); and 

15 ‘‘(E) provide for an appeals process to 

16 allow for review of decisions by State courts. 

17 ‘‘(f) REVIEW BY STATE COURT AFTER EXHAUSTION

18 OF ADMINISTRATIVE REMEDIES.— 

19 ‘‘(1) RIGHT TO FILE.—If any party to a dispute 

20 before a health care tribunal under subsection (e) is 

21 not satisfied with the determinations of the tribunal, 

22 the party shall have the right to file their claim in 

23 a State court of competent jurisdiction. 

24 ‘‘(2) FORFEIT OF AWARDS.—Any party filing 

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1 graph (1) shall forfeit any compensation award 

2 made under subsection (e). 

3 ‘‘(3) ADMISSIBILITY.—The determinations of 

4 the expert panel and the administrative health care 

5 tribunal pursuant to subsections (d) and (e) with re6 spect to a State court proceeding under paragraph 

7 (1) shall be admissible into evidence in any such 

8 State court proceeding. 

9 ‘‘(g) DEFINITION.—In this section, the term ‘health 

10 care provider’ has the meaning given such term for pur11 poses of part A of title VII. 

12 ‘‘(h) FUNDING.— 

13 ‘‘(1) ONE-TIME INCREASE IN MEDICAID PAY14 MENT.—In the case of a State awarded a grant to 

15 carry out this section, the total amount of Federal 

16 payments made to the State under section 1903(a) 

17 of the Social Security Act or section 1939(b)of such 

18 Act (in the case of fiscal year 2010 or any fiscal 

19 year thereafter) for the first fiscal year for which 

20 such grant is awarded shall be increased by an 

21 amount equal to 1 percent of of the total amount of 

22 such payments made to the State for the preceding 

23 fiscal year under such 1903(a) or 1939(b) (as appli24 cable) for purposes of carrying out this section. 

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1 Amounts paid to a State pursuant to this subsection 

2 shall remain available until expended. 

3 ‘‘(2) AUTHORIZATION OF APPROPRIATIONS.— 

4 There are authorized to be appropriated for any fis5 cal year such sums as may be necessary for purposes 

6 of making payments to States pursuant to para7 graph (1).’’. 

8 TITLE V—TAX CREDIT FOR 

9 HEALTH INFORMATION TECH10 NOLOGY 

11 SEC. 501. PURCHASE OF QUALIFIED HEALTH CARE INFOR12 MATION TECHNOLOGY. 

13 (a) IN GENERAL.—Section 179 of the Internal Rev14 enue Code of 1986 (relating to election to expense certain 

15 depreciable assets) is amended by adding at the end the 

16 following new subsection: 

17 ‘‘(e) HEALTH CARE INFORMATION TECHNOLOGY.— 

18 ‘‘(1) IN GENERAL.—In the case of qualified 

19 health care information technology purchased by a 

20 medical care provider and placed in service during a 

21 taxable year— 

22 ‘‘(A) subsection (b)(1) shall be applied by 

23 substituting ‘$300,000’ for ‘$100,000’, 

24 ‘‘(B) subsection (b)(2) shall be applied by 

25 substituting ‘$600,000’ for ‘$400,000’, and 

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1 ‘‘(C) subsection (b)(5)(A) shall be applied 

2 by substituting ‘$300,000 and $600,000’ for 

3 ‘$100,000 and $400,000’. 

4 ‘‘(2) DEFINITIONS.—For purposes of this sub5 section— 

6 ‘‘(A) QUALIFIED HEALTH CARE INFORMA7 TION TECHNOLOGY.—The term ‘qualified health 

8 care information technology’ means section 179 

9 property which is used primarily for the elec10 tronic creation, maintenance, and exchange of 

11 medical care information to improve the quality 

12 or efficiency of medical care. 

13 ‘‘(B) MEDICAL CARE PROVIDER.—The 

14 term ‘medical care provider’ means any person 

15 engaged in the trade or business of providing 

16 medical care. 

17 ‘‘(C) MEDICAL CARE.—The term ‘medical 

18 care’ has the meaning given such term by sec19 tion 213(d).’’. 

20 (b) EFFECTIVE DATE.—The amendment made by 

21 this section shall apply to property placed in service after 

22 December 31, 2006. 

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1 SEC. 502. TELECOMMUNICATIONS CREDIT FOR QUALIFIED 

2 MEDICAL CARE PROVIDERS. 

3 (a) IN GENERAL.—Subpart D of part IV of sub4 chapter A of chapter 1 of the Internal Revenue Code of 

5 1986 (relating to business related credits) is amended by 

6 adding at the end the following new section: 

7 ‘‘SEC. 45N. TELECOMMUNICATIONS CREDIT FOR QUALI8 FIED MEDICAL CARE PROVIDERS. 

9 ‘‘(a) GENERAL RULE.—For purposes of section 38, 

10 in the case of a qualified medical care provider, the tele11 communications credit determined under this section for 

12 a taxable year is an amount equal to 50 percent of the 

13 applicable telecommunications charges paid or incurred by 

14 such provider during the taxable year. 

15 ‘‘(b) DOLLAR LIMITATION.—In the case of a qualified 

16 medical care provider, the credit determined under sub17 section (a) for a taxable year shall not exceed $12,500. 

18 ‘‘(c) DEFINITIONS.—For purposes of this section— 

19 ‘‘(1) APPLICABLE TELECOMMUNICATIONS

20 CHARGES.—The term ‘applicable telecommunications 

21 charges’ means expenses paid or incurred for the 

22 purpose of installing or maintaining a communica23 tions network that supports interoperability of elec24 tronic medical record systems. 

25 ‘‘(2) QUALIFIED MEDICAL CARE PROVIDER.— 

26 The term ‘qualified medical care provider’ means 

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1 any person engaged in the trade or business of pro2 viding medical care (as defined in section 213(d)) 

3 who has purchased qualified health care information 

4 technology (as defined in section 179(e)).’’. 

5 (b) CONFORMING AMENDMENTS.— 

6 (1) Section 38(b) of such Code is amended by 

7 striking ‘‘plus’’ at the end of paragraph (25), by 

8 striking the period at the end of paragraph (26) and 

9 inserting ‘‘, plus’’, and by adding at the end the fol10 lowing new paragraph: 

11 ‘‘(27) the telecommunications credit determined 

12 under section 45N.’’. 

13 (2) The table of sections for subpart D of part 

14 IV of subchapter A of chapter 1 of such Code is 

15 amended by adding at the end the following new 

16 item: 

‘‘Sec. 45N. Telecommunications credit for qualified medical care providers.’’. 

17 (c) EFFECTIVE DATE.—The amendments made by 

18 this section shall apply to expenses paid or incurred after 

19 December 31, 2006. 

20 SEC. 503. DEVELOPMENT OF HEALTH CARE INFORMATION 

21 TECHNOLOGY STANDARDS. 

22 Not later than 5 years after the date of the enact23 ment of this Act, the Secretary of Health and Human 

24 Services shall develop standards for health information 

25 technology, including for qualified health care information 

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1 technology (as defined in section 179(e)(2)(A) of the In2 ternal Revenue Code of 1986, as added by section 501(a)). 

3 TITLE VI—MEDICAL LIABILITY 

4 REFORMS 

5 SEC. 601. CONSTITUTIONAL AUTHORITY. 

6 The constitutional authority upon which this title 

7 rests is the power of the Congress to provide for the gen8 eral welfare, to regulate commerce, and to make all laws 

9 which shall be necessary and proper for carrying into exe10 cution Federal powers, as enumerated in section 8 of arti11 cle I of the Constitution of the United States. 

12 SEC. 602. PROTECTION AGAINST LEGAL LIABILITY FOR 

13 EMERGENCY AND RELATED SERVICES FUR14 NISHED TO ANY INDIVIDUAL. 

15 Section 224(g) of the Public Health Service Act (42 

16 U.S.C. 233(g)) is amended— 

17 (1) in paragraph (4), by striking ‘‘An entity’’ 

18 and inserting in lieu thereof ‘‘Subject to paragraph 

19 (6), an entity’’; and 

20 (2) by adding at the end the following: 

21 ‘‘(6)(A) For purposes of this section— 

22 ‘‘(i) an entity described in subparagraph (B) 

23 shall be considered to be an entity described in para24 graph (4); and 

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1 ‘‘(ii) the provisions of this section shall apply to 

2 an entity described in subparagraph (B) in the same 

3 manner as such provisions apply to an entity de4 scribed in paragraph (4), except that— 

5 ‘‘(I) notwithstanding paragraph (1)(B), the 

6 deeming of any entity described in subpara7 graph (B), or of an officer, governing board 

8 member, employee, or contractor of such an en9 tity, to be an employee of the Public Health 

10 Service for purposes of this section shall apply 

11 only with respect to items and services that are 

12 furnished to an individual pursuant to section 

13 1867 of the Social Security Act and to post-sta14 bilization services (as defined in subparagraph 

15 (C)) furnished to such an individual; 

16 ‘‘(II) nothing in paragraph (1)(D) shall be 

17 construed as preventing a physician or physi18 cian group described in subparagraph (B)(ii) 

19 from making the application referred to in such 

20 paragraph or as conditioning the deeming of a 

21 physician or physician group that makes such 

22 an application upon receipt by the Secretary of 

23 an application from the hospital or emergency 

24 department that employs or contracts with the 

25 physician or group; 

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1 ‘‘(III) notwithstanding paragraph (3), this 

2 paragraph shall apply only with respect to 

3 causes of action arising from acts or omissions 

4 that occur on or after January 1, 2008; 

5 ‘‘(IV) paragraph (5) shall not apply to a 

6 physician or physician group described in sub7 paragraph (B)(ii); 

8 ‘‘(V) the Attorney General, in consultation 

9 with the Secretary, shall make separate esti10 mates under subsection (k)(1) with respect to 

11 entities described in subparagraph (B) and enti12 ties described in paragraph (4) (other than 

13 those described in subparagraph (B)), and the 

14 Secretary shall establish separate funds under 

15 subsection (k)(2) with respect to such groups of 

16 entities, and any appropriations under this sub17 section for entities described in subparagraph 

18 (B) shall be separate from the amounts author19 ized by subsection (k)(2); 

20 ‘‘(VI) notwithstanding subsection (k)(2), 

21 the amount of the fund established by the Sec22 retary under such subsection with respect to en23 tities described in subparagraph (B) may ex24 ceed a total of $10,000,000 for a fiscal year; 

25 and 

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1 ‘‘(VII) subsection (m) shall not apply to 

2 entities described in subparagraph (B). 

3 ‘‘(B) An entity described in this subparagraph is— 

4 ‘‘(i) a hospital or an emergency department to 

5 which section 1867 of the Social Security Act ap6 plies; and 

7 ‘‘(ii) a physician or physician group that is em8 ployed by, or under contract with, such hospital or 

9 department to furnish items and services to individ10 uals under such section, including so-called ‘on call 

11 physicians’ . 

12 ‘‘(C) For purposes of this paragraph, the term ‘post13 stabilization services’ means, with respect to an individual 

14 who has been treated by an entity described in subpara15 graph (B) for purposes of complying with section 1867 

16 of the Social Security Act, services that are— 

17 ‘‘(i) related to the condition that was so treated; 

18 and 

19 ‘‘(ii) provided after the individual is stabilized 

20 in order to maintain the stabilized condition or to 

21 improve or resolve the individual’s condition. 

22 ‘‘(D)(i) Nothing in this paragraph (or in any other 

23 provision of this section as such provision applies to enti24 ties described in subparagraph (B) by operation of sub25 paragraph (A)) shall be construed as authorizing or remstockstill on PROD1PC66 with BILLS

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1 quiring the Secretary to make payments to such entities, 

2 the budget authority for which is not provided in advance 

3 by appropriation Acts. 

4 ‘‘(ii) The Secretary shall limit the total amount of 

5 payments under this paragraph for a fiscal year to the 

6 total amount appropriated in advance by appropriation 

7 Acts for such purpose for such fiscal year. If the total 

8 amount of payments that would otherwise be made under 

9 this paragraph for a fiscal year exceeds such total amount 

10 appropriated, the Secretary shall take such steps as may 

11 be necessary to ensure that the total amount of payments 

12 under this paragraph for such fiscal year does not exceed 

13 such total amount appropriated.’’. 

14 TITLE VII—TAX DEDUCTION FOR 

15 UNCOMPENSATED CARE IN 

16 EMERGENCY ROOMS 

17 SEC. 701. BAD DEBT DEDUCTION FOR DOCTORS TO PAR18 TIALLY OFFSET THE COST OF PROVIDING UN19 COMPENSATED CARE REQUIRED TO BE PRO20 VIDED UNDER AMENDMENTS MADE BY THE 

21 EMERGENCY MEDICAL TREATMENT AND 

22 LABOR ACT. 

23 (a) IN GENERAL.—Section 166 of the Internal Rev24 enue Code of 1986 (relating to bad debts) is amended by 

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1 redesignating subsection (f) as subsection (g) and by in2 serting after subsection (e) the following new subsection: 

3 ‘‘(f) BAD DEBT TREATMENT FOR DOCTORS TO PAR4 TIALLY OFFSET COST OF PROVIDING UNCOMPENSATED

5 CARE REQUIRED TO BE PROVIDED.— 

6 ‘‘(1) AMOUNT OF DEDUCTION.— 

7 ‘‘(A) IN GENERAL.—For purposes of sub8 section (a), the basis for determining the 

9 amount of any deduction for an eligible 

10 EMTALA debt shall be treated as being equal 

11 to the Medicare payment amount. 

12 ‘‘(B) MEDICARE PAYMENT AMOUNT.—For 

13 purposes of subparagraph (A), the Medicare 

14 payment amount with respect to an eligible 

15 EMTALA debt is the fee schedule amount es16 tablished under section 1848 of the Social Secu17 rity Act for the physicians’ service (to which 

18 such debt relates) as if the service were pro19 vided to an individual enrolled under part B of 

20 title XVIIII of such Act. 

21 ‘‘(2) ELIGIBLE EMTALA DEBT.—For purposes 

22 of this section, the term ‘eligible EMTALA debt’ 

23 means any debt if— 

24 ‘‘(A) such debt arose as a result of physi25 cians’ services— 

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1 ‘‘(i) which were performed in an 

2 EMTALA hospital by a board-certified 

3 physician (whether as part of medical 

4 screening or necessary stabilizing treat5 ment and whether as an emergency depart6 ment physician, as an on-call physician, or 

7 otherwise), and 

8 ‘‘(ii) which were required to be pro9 vided under section 1867 of the Social Se10 curity Act (42 U.S.C. 1395dd), and 

11 ‘‘(B) such debt is owed— 

12 ‘‘(i) to such physician, or 

13 ‘‘(ii) to an entity if— 

14 ‘‘(I) such entity is a corporation 

15 and the sole shareholder of such cor16 poration is such physician, or 

17 ‘‘(II) such entity is a partnership 

18 and any deduction under this sub19 section with respect to such debt is al20 located to such physician or to an en21 tity described in subclause (I). 

22 ‘‘(3) BOARD-CERTIFIED PHYSICIAN.—For pur23 poses of this subsection, the term ‘board-certified 

24 physician’ means any physician (as defined in sec25 tion 1861(r) of the Social Security Act (42 U.S.C. 

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1 1395x(r)) who is certified by the American Board of 

2 Emergency Medicine or other appropriate medical 

3 specialty board for the specialty in which the physi4 cian practices, or who meets comparable require5 ments, as identified by the Secretary of the Treasury 

6 in consultation with Secretary of Health and Human 

7 Services. 

8 ‘‘(4) OTHER DEFINITIONS.—For purposes of 

9 this subsection— 

10 ‘‘(A) EMTALA HOSPITAL.—The term 

11 ‘EMTALA hospital’ means any hospital having 

12 a hospital emergency department which is re13 quired to comply with section 1867 of the So14 cial Security Act (42 U.S.C. 1395dd) (relating 

15 to examination and treatment for emergency 

16 medical conditions and women in labor). 

17 ‘‘(B) PHYSICIANS’ SERVICES.—The term 

18 ‘physicians’ services’ has the meaning given 

19 such term in section 1861(q) of the Social Se20 curity Act (42 U.S.C. 1395x(q)).’’. 

21 (b) EFFECTIVE DATE.—The amendments made by 

22 this section shall apply to debts arising from services per23 formed in taxable years beginning after the date of the 

24 enactment of this Act. 

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1 TITLE VIII—ADDITIONAL 

2 CHANGES 

3 SEC. 801. APPLICATION OF SECTION 1115 WAIVERS BY 

4 OTHER STATES. 

5 Section 1115 of the Social Security Act (42 U.S.C. 

6 1315) is amended by adding at the end the following new 

7 subsection: 

8 ‘‘(g) If the Secretary has waived under subsection (a) 

9 compliance with one or more requirements of title XIX 

10 in connection with a project of a State and such waiver 

11 has not been terminated, the Secretary shall also waive 

12 compliance with such requirements in connection with a 

13 project conducted by another State that is consistent with 

14 the terms and conditions for the original project.’’. 

15 SEC. 802. HIPAA TECHNICAL ADVISORY GROUP. 

16 (a) ESTABLISHMENT.—The Secretary shall establish 

17 a Technical Advisory Group (in this section referred to 

18 as the ‘‘Advisory Group’’) to review issues related to the 

19 HIPAA regulations and their implementation. In this sec20 tion, the term ‘‘HIPAA regulations’’ refers to the regula21 tions promulgated pursuant to section 264(c) of the 

22 Health Insurance Portability and Accountability Act of 

23 1996 (42 U.S.C. 1320d–1 note). 

24 (b) MEMBERSHIP.—The Advisory Group shall be 

25 composed of 19 members, including the Administrator of 

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1 the Centers for Medicare & Medicaid Services and the In2 spector General of the Department of Health and Human 

3 Services and of which— 

4 (1) 2 shall be representatives of hospitals, in5 cluding at least one public hospital, that have experi6 ence with the application of HIPAA regulations; 

7 (2) 9 shall be practicing physicians drawn from 

8 the fields of emergency medicine, cardiology or 

9 cardiothoracic surgery, orthopaedic surgery, neuro10 surgery, general surgery with expertise in trauma, 

11 internal medicine, pediatrics or a pediatric sub12 specialty, obstetrics-gynecology, and psychiatry, with 

13 not more than one physician from any particular 

14 field; 

15 (3) 2 shall be non-physician representatives 

16 from private medical practices with significant pa17 tient volume; 

18 (4) 2 shall represent patients; 

19 (5) 2 shall be staff involved in HIPAA regula20 tions investigations from different regional offices of 

21 the Centers for Medicare & Medicaid Services; and 

22 (6) 1 shall be from a State survey office in23 volved in HIPAA regulations investigations and 1 

24 shall be from a peer review organization, both of 

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1 whom shall be from areas other than the regions 

2 represented under paragraph (5). 

3 In selecting members described in paragraphs (1) through 

4 (4), the Secretary shall consider qualified individuals nom5 inated by organizations representing providers and pa6 tients. 

7 (c) GENERAL RESPONSIBILITIES.—The Advisory 

8 Group— 

9 (1) shall review HIPAA regulations; 

10 (2) may provide advice and recommendations to 

11 the Secretary with respect to those regulations and 

12 their application to hospitals, medical practices, out13 patient services and physicians; 

14 (3) shall solicit comments and recommendations 

15 from hospitals, physicians, and the public regarding 

16 the implementation of such regulations; 

17 (4) may disseminate information on the applica18 tion of such regulations to hospitals, physicians, and 

19 the public; and 

20 (5) shall make recommendations to Congress 

21 regarding any reforms recommended that may ease 

22 the regulatory burden on those caring for patients. 

23 (d) ADMINISTRATIVE MATTERS.— 

24 (1) CHAIRPERSON.—The members of the Advi25 sory Group shall elect a member to serve as chairmstockstill on PROD1PC66 with BILLS

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1 person of the Advisory Group for the life of the Ad2 visory Group. 

3 (2) MEETINGS.—The Advisory Group shall first 

4 meet at the direction of the Secretary. The Advisory 

5 Group shall then meet twice per year and at such 

6 other times as the Advisory Group may provide. 

7 (e) TERMINATION.—The Advisory Group shall termi8 nate 30 months after the date of its first meeting. 

9 (f) WAIVER OF ADMINISTRATIVE LIMITATION.—The 

10 Secretary shall establish the Advisory Group notwith11 standing any limitation that may apply to the number of 

12 advisory committees that may be established (within the 

13 Department of Health and Human Services or otherwise). 

14 SEC. 803. MEDICARE PHYSICIAN PAYMENT UPDATE RE15 FORM. 

16 (a) SUBSTITUTION OF MEI INCREASE FOR SGR AD17 JUSTMENTS.—Section 1848(d) of the Social Security Act 

18 (42 U.S.C. 1395w–4(d)) is amended— 

19 (1) in paragraph (1)(A), by inserting ‘‘and be20 fore 2008’’ after ‘‘beginning with 2001’’; 

21 (2) in paragraph (1)(A), by inserting before the 

22 period at the end the following: ‘‘, and for years be23 ginning with 2008, multiplied by the update estab24 lished under paragraph (7) applicable to the year in25 volved’’; and 

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1 (3) in paragraph (4)— 

2 (A) in the heading by striking ‘‘YEARS BE3 GINNING WITH 2001’’ and inserting ‘‘2001, 2002, 

4 AND 2003’’; and 

5 (B) in subparagraph (A), by inserting 

6 ‘‘and ending with 2003’’ after ‘‘beginning with 

7 2001’’; and 

8 (4) by adding at the end the following new 

9 paragraph: 

10 ‘‘(8) UPDATE BEGINNING WITH 2008.—The up11 date to the single conversion factor established in 

12 paragraph (1)(C) for 2008 and each succeeding year 

13 shall be the percentage increase in the MEI (as de14 fined in section 1842(i)(3)) for the year involved.’’. 

15 (b) ENDING APPLICATION OF SUSTAINABLE

16 GROWTH RATE (SGR).—Section 1848(f)(1)(B) of such 

17 Act (42 U.S.C. 1395w–4(f)(1)(B)) is amended by insert18 ing ‘‘(and before 2007)’’ after ‘‘each succeeding year’’. 

19 (c) EFFECTIVE DATE.—The amendments made by 

20 this section shall apply to payment for services furnished 

21 on or after January 1, 2008. 

22 SEC. 804. REMOVING LIMITATIONS ON BALANCE BILLING 

23 WITH BENEFICIARY NOTICE. 

24 (a) IN GENERAL.—Section 1848(g) of the Social Se25 curity Act (42 U.S.C. 1395w–4(g)) is amended— 

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1 (1) in paragraph (1)(A), in the matter before 

2 clause (i), by inserting ‘‘, subject to subparagraph 

3 (D),’’ after ‘‘enrolled under this part’’; 

4 (2) in paragraph (1), by adding at the end the 

5 following new subparagraph: 

6 ‘‘(D) EXCEPTION.—Subparagraph (A) 

7 shall not apply with respect to physicians’ serv8 ices furnished in a month to an individual if the 

9 individual furnishing such services provides the 

10 advance notice of such non-participation and 

11 non-acceptance of assignment under paragraph 

12 (8) and (for services furnished on or after Jan13 uary 1, 2008) submits information in accord14 ance with subsection (k)(4).’’; and 

15 (3) by adding at the end the following new 

16 paragraph: 

17 ‘‘(8) NOTICE OF NON-PARTICIPATION AND NON18 ACCEPTANCE OF ASSIGNMENT.—For purposes of 

19 paragraph (1)(D), the advance notice of non-partici20 pation and non-acceptance of assignment shall be, 

21 with respect to an item or service furnished under 

22 this part by (or under the supervision of) a physi23 cian, a notice (that may be in the form of a posting 

24 in a conspicuous place in a physician’s office or on 

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1 wise furnished in a manner so as to inform the indi2 vidual receiving the item or service that— 

3 ‘‘(A) the physician furnishing (or super4 vising the furnishing of) the items or service is 

5 not a participating physician and does not ac6 cept assignment with respect to the service; and 

7 ‘‘(B) because of such non-acceptance, in 

8 the case of physicians’ services furnished in a 

9 month to an individual, the charge imposed is 

10 not limited and may exceed the limiting charge 

11 described in paragraph (2).’’. 

12 (b) CONFORMING AMENDMENT TO PRIVATE CON13 TRACT PROVISIONS.—Section 1802 of such Act (42 

14 U.S.C. 1395a) is amended by adding at the end the fol15 lowing new paragraph: 

16 ‘‘(6) EXCEPTION.—The previous provisions of 

17 this subsection shall not apply to physicians’ services 

18 furnished in a month to an individual if the advance 

19 notice described in section 1848(g)(8) has been pro20 vided and (for services furnished on or after Janu21 ary 1, 2008) the physician furnishing the services 

22 submits information in accordance with section 

23 1848(k)(4).’’. 

24 (c) CONFORMING AMENDMENT TO PARTICIPATION

25 PROVISIONS.—Section 1842(h) of such Act (42 U.S.C. 

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1 1395u) is amended by adding at the end the following new 

2 paragraph: 

3 ‘‘(8) The previous provisions of this subsection, inso4 far as they limit the charges that a participating physician 

5 may impose, shall not apply to physicians’ services fur6 nished in a month to an individual if the advance notice 

7 described in section 1848(g)(8) has been provided and (for 

8 services furnished on or after January 1, 2008) the physi9 cian furnishing the services submits information in accord10 ance with section 1848(k)(4).’’. 

11 (d) EFFECTIVE DATE.—The amendments made by 

12 this section shall apply to services furnished on or after 

13 January 1, 2008. 

14 SEC. 805. ELECTION OF TAX CREDIT INSTEAD OF ALTER15 NATIVE GOVERNMENT BENEFITS. 

16 (a) IN GENERAL.—Notwithstanding any other provi17 sion of law, an individual who is otherwise eligible for ben18 efits under a Federal health program (as defined in sub19 section (c)) may elect, in a form and manner specified by 

20 the Secretary of Health and Human Services in consulta21 tion with the Secretary of the Treasury, to receive a tax 

22 credit described in section 36 of the Internal Revenue 

23 Code of 1986 (which may be used for the purpose of 

24 health insurance coverage) in lieu of receiving any benefits 

25 under such program. 

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1 (b) EFFECTIVE DATE.—An election under subsection 

2 (a) may first be made for calendar year 2009 and any 

3 such election shall be effective for such period (not less 

4 than one calendar year) as the Secretary of Health and 

5 Human Services shall specify, in consultation with the 

6 Secretary of the Treasury. 

7 (c) FEDERAL HEALTH PROGRAM DEFINED.—For 

8 purposes of this section, the term ‘‘Federal health pro9 gram’’ means any of the following: 

10 (1) MEDICARE.—The medicare program under 

11 part A of title XVIII of the Social Security Act, in12 cluding any benefits under any other part of such 

13 title. 

14 (2) MEDICAID.—The Medicaid program under 

15 title XIX of such Act (including such a program op16 erating under a Statewide waiver under section 1115 

17 of such Act). 

18 (3) SCHIP.—The State children’s health insur19 ance program under title XXI of such Act. 

20 (4) TRICARE.—The TRICARE program 

21 under chapter 55 of title 10, United States Code. 

22 (5) VETERANS BENEFITS.—Coverage for bene23 fits under chapter 17 of title 38, United States 

24 Code. 

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1 SEC. 806. USE OF PRIVATE CONTRACTS BY MEDICARE 

2 BENEFICIARIES FOR PROFESSIONAL SERV3 ICES. 

4 (a) IN GENERAL.—Section 1802 of the Social Secu5 rity Act (42 U.S.C. 1395a) is amended by striking sub6 section (b) and inserting the following: 

7 ‘‘(b) CLARIFICATION OF USE OF PRIVATE CON8 TRACTS BY MEDICARE BENEFICIARIES FOR PROFES9 SIONAL SERVICES.— 

10 ‘‘(1) IN GENERAL.—Nothing in this title shall 

11 prohibit a medicare beneficiary from entering into a 

12 private contract with a physician or health care 

13 practitioner for the provision of medicare covered 

14 professional services (as defined in paragraph 

15 (5)(C)) if— 

16 ‘‘(A) the services are covered under a pri17 vate contract that is between the beneficiary 

18 and the physician or practitioner and meets the 

19 requirements of paragraph (2); 

20 ‘‘(B) under the private contract no claim 

21 for payment for services covered under the con22 tract is to be submitted (and no payment made) 

23 under part A or B under a contract under sec24 tion 1876, or under a Medicare Advantage plan 

25 (other than an MSA plan); and 

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1 ‘‘(C)(i) the Secretary has been provided 

2 with the minimum information necessary to 

3 avoid any payment under part A or B for serv4 ices covered under the contract, or 

5 ‘‘(ii) in the case of an individual enrolled 

6 under a contract under section 1876 or a Medi7 care Advantage plan (other than an MSA plan) 

8 under part C, the eligible organization under 

9 the contract or the Medicare Advantage organi10 zation offering the plan has been provided the 

11 minimum information necessary to avoid any 

12 payment under such contract or plan for serv13 ices covered under the contract. 

14 ‘‘(2) REQUIREMENTS FOR PRIVATE CON15 TRACTS.—The requirements in this paragraph for a 

16 private contract between a medicare beneficiary and 

17 a physician or health care practitioner are as fol18 lows: 

19 ‘‘(A) GENERAL FORM OF CONTRACT.—The 

20 contract is in writing and is signed by the medi21 care beneficiary. 

22 ‘‘(B) NO CLAIMS TO BE SUBMITTED FOR

23 COVERED SERVICES.—The contract provides 

24 that no party to the contract (and no entity on 

25 behalf of any party to the contract) shall submstockstill on PROD1PC66 with BILLS

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1 mit any claim for (or request) payment for 

2 services covered under the contract under part 

3 A or B, under a contract under section 1876, 

4 or under a Medicare Advantage plan (other 

5 than an MSA plan). 

6 ‘‘(C) SCOPE OF SERVICES.—The contract 

7 identifies the medicare covered professional 

8 services and the period (if any) to be covered 

9 under the contract, but does not cover any serv10 ices furnished— 

11 ‘‘(i) before the contract is entered 

12 into; or 

13 ‘‘(ii) for the treatment of an emer14 gency medical condition (as defined in sec15 tion 1867(e)(1)(A)), unless the contract 

16 was entered into before the onset of the 

17 emergency medical condition. 

18 ‘‘(D) CLEAR DISCLOSURE OF TERMS.—The 

19 contract clearly indicates that by signing the 

20 contract the medicare beneficiary— 

21 ‘‘(i) agrees not to submit a claim (or 

22 to request that anyone submit a claim) 

23 under part A or B (or under section 1876 

24 or under a Medicare Advantage plan, other 

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1 than an MSA plan) for services covered 

2 under the contract; 

3 ‘‘(ii) agrees to be responsible, whether 

4 through insurance or otherwise, for pay5 ment for such services and understands 

6 that no reimbursement will be provided 

7 under such part, contract, or plan for such 

8 services; 

9 ‘‘(iii) acknowledges that no limits 

10 under this title (including limits under 

11 paragraph (1) and (3) of section 1848(g)) 

12 will apply to amounts that may be charged 

13 for such services; 

14 ‘‘(iv) acknowledges that medicare sup15 plemental policies under section 1882 do 

16 not, and other supplemental health plans 

17 and policies may elect not to, make pay18 ments for such services because payment is 

19 not made under this title; and 

20 ‘‘(v) acknowledges that the beneficiary 

21 has the right to have such services pro22 vided by (or under the supervision of) 

23 other physicians or health care practi24 tioners for whom payment would be made 

25 under such part, contract, or plan. 

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1 Such contract shall also clearly indicate whether 

2 the physician or practitioner involved is ex3 cluded from participation under this title. 

4 ‘‘(3) MODIFICATIONS.—The parties to a private 

5 contract may mutually agree at any time to modify 

6 or terminate the contract on a prospective basis, 

7 consistent with the provisions of paragraphs (1) and 

8 (2). 

9 ‘‘(4) NO REQUIREMENTS FOR SERVICES FUR10 NISHED TO MSA PLAN ENROLLEES.—The require11 ments of paragraphs (1) and (2) do not apply to any 

12 contract or arrangement for the provision of services 

13 to a medicare beneficiary enrolled in an MSA plan 

14 under part C. 

15 ‘‘(5) DEFINITIONS.—In this subsection: 

16 ‘‘(A) HEALTH CARE PRACTITIONER.—The 

17 term ‘health care practitioner’ means a practi18 tioner described in section 1842(b)(18)(C). 

19 ‘‘(B) MEDICARE BENEFICIARY.—The term 

20 ‘medicare beneficiary’ means an individual who 

21 is enrolled under part B. 

22 ‘‘(C) MEDICARE COVERED PROFESSIONAL

23 SERVICES.—The term ‘medicare covered profes24 sional services’ means— 

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1 ‘‘(i) physicians’ services (as defined in 

2 section 1861(q), and including services de3 scribed in section 1861(s)(2)(A)), and 

4 ‘‘(ii) professional services of health 

5 care practitioners, including services de6 scribed in section 1842(b)(18)(D), 

7 for which payment may be made under part A 

8 or B, under a contract under section 1876, or 

9 under a Medicare Advantage plan but for the 

10 provisions of a private contract that meets the 

11 requirements of paragraph (2). 

12 ‘‘(D) MEDICARE ADVANTAGE PLAN; MSA

13 PLAN.—The terms ‘Medicare Advantage plan’ 

14 and ‘MSA plan’ have the meanings given the 

15 terms ‘Medicare+Choice plan’ and ‘MSA plan’ 

16 in section 1859. 

17 ‘‘(E) PHYSICIAN.—The term ‘physician’ 

18 has the meaning given such term in section 

19 1861(r).’’. 

20 (b) CONFORMING AMENDMENTS CLARIFYING EX21 EMPTION FROM LIMITING CHARGE AND FROM REQUIRE22 MENT FOR SUBMISSION OF CLAIMS.—Section 1848(g) of 

23 the Social Security Act (42 U.S.C. 1395w–4(g)) is amend24 ed— 

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1 (1) in paragraph (1)(A), by striking ‘‘In’’ and 

2 inserting ‘‘Subject to paragraph (8), in’’; 

3 (2) in paragraph (3)(A), by striking ‘‘Payment’’ 

4 and inserting ‘‘Subject to paragraph (8), payment’’; 

5 (3) in paragraph (4)(A), by striking ‘‘For’’ and 

6 inserting ‘‘Subject to paragraph (8), for’’; and 

7 (4) by adding at the end the following new 

8 paragraph: 

9 ‘‘(8) EXEMPTION FROM REQUIREMENTS FOR

10 SERVICES FURNISHED UNDER PRIVATE CON11 TRACTS.— 

12 ‘‘(A) IN GENERAL.—Pursuant to section 

13 1802(b)(1), paragraphs (1), (3), and (4) do not 

14 apply with respect to physicians’ services (and 

15 services described in section 1861(s)(2)(A)) fur16 nished to an individual by (or under the super17 vision of) a physician if the conditions described 

18 in section 1802(b)(1) are met with respect to 

19 the services. 

20 ‘‘(B) NO RESTRICTIONS FOR ENROLLEES

21 IN MSA PLANS.—Such paragraphs do not apply 

22 with respect to services furnished to individuals 

23 enrolled with MSA plans under part C, without 

24 regard to whether the conditions described in 

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1 subparagraphs (A) through (C) of section 

2 1802(b)(1) are met. 

3 ‘‘(C) APPLICATION TO ENROLLEES IN

4 OTHER PLANS.—Subject to subparagraph (B) 

5 and section 1852(k)(2), the provisions of sub6 paragraph (A) shall apply in the case of an in7 dividual enrolled under a contract under section 

8 1876 or under a Medicare Advantage plan 

9 (other than an MSA plan) under part C, in the 

10 same manner as they apply to individuals not 

11 enrolled under such a contract or plan.’’. 

12 (c) CONFORMING AMENDMENTS.— 

13 (1) Section 1842(b)(18) of the Social Security 

14 Act (42 U.S.C. 1395u(b)(18)) is amended by adding 

15 at the end the following: 

16 ‘‘(E) The provisions of section 1848(g)(8) 

17 shall apply with respect to exemption from limi18 tations on charges and from billing require19 ments for services of health care practitioners 

20 described in this paragraph in the same manner 

21 as such provisions apply to exemption from the 

22 requirements referred to in section 

23 1848(g)(8)(A) for physicians’ services.’’. 

24 (2) Section 1866(a)(1)(O) of such Act (42 

25 U.S.C. 1395cc(a)(1)(O)) is amended by inserting 

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1 ‘‘(other than under an MSA plan)’’ after 

2 ‘‘Medicare+Choice organization under part C’’. 

3 (d) EFFECTIVE DATE.—The amendments made by 

4 this section shall be effective on the date of the enactment 

5 of this Act. 

6 SEC. 807. EMTALA TECHNICAL ADVISORY GROUP. 

7 (a) AUTHORIZATION FOR EXTENSION.—Subsection 

8 (e) of section 945 of the Medicare Prescription Drug, Im9 provement, and Modernization Act of 2003 (Public Law 

10 108–173; 42 U.S.C. 1395dd note) is amended by inserting 

11 before the period at the end the following: ‘‘, except that 

12 the Secretary may extend the Advisory Group beyond such 

13 date in order to permit the Advisory Group to continue 

14 to carry out its responsibilities’’. 

15 (b) SECRETARIAL RESPONSIVE REPORT ON GROUP

16 RECOMMENDATIONS.—Such section is further amended 

17 by adding at the end the following new subsection: 

18 ‘‘(g) SECRETARIAL RESPONSE TO RECOMMENDA19 TIONS.—The Secretary shall review the recommendations 

20 made to the Secretary by the Advisory Group and shall 

21 submit to Congress a report that contains a description 

22 of any actions the Secretary intends to take in response 

23 to such recommendations and problems identified by the 

24 Advisory Group with regard to the EMTALA regulations 

25 and their application.’’. 

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1 SEC. 808. FEDERALLY-SUPPORTED STUDENT LOAN FUNDS 

2 FOR MEDICAL STUDENTS. 

3 (a) PRIMARY HEALTH CARE MEDICAL STUDENTS.— 

4 Subpart II of part A of the Public Health Service Act (42 

5 U.S.C. 292q et seq.) is amended— 

6 (1) by redesignating section 735 as section 729; 

7 and 

8 (2) in subsection (f) of section 729 (as so redes9 ignated), by striking ‘‘is authorized to be appro10 priated to be appropriated $10,000,000 for each of 

11 the fiscal years 1994 through 1996’’ and inserting 

12 ‘‘are authorized to be appropriated such sums as 

13 may be necessary for fiscal year 2008 and each fis14 cal year thereafter’’. 

15 (b) OTHER MEDICAL STUDENTS.—Part A of title VII 

16 of the Public Health Service Act (42 U.S.C. 292 et seq.) 

17 is amended by adding at the end the following: 

18 ‘‘Subpart III—Federally-Supported Student Loan 

19 Funds for Certain Medical Students 

20 ‘‘SEC. 730. SCHOOL LOAN FUNDS FOR CERTAIN MEDICAL 

21 STUDENTS. 

22 ‘‘(a) FUND AGREEMENTS.—For the purpose de23 scribed in subsection (b), the Secretary is authorized to 

24 enter into an agreement for the establishment and oper25 ation of a student loan fund with any public or nonprofit 

26 school of medicine or osteopathic medicine. 

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1 ‘‘(b) PURPOSE.—The purpose of this subpart is to 

2 provide for loans to medical students who would be eligible 

3 for a loan under subpart II, except for the student’s deci4 sion to enter a residency training program in a field other 

5 than primary health care. 

6 ‘‘(c) COMMENCEMENT OF REPAYMENT PERIOD.— 

7 The repayment period for a loan under this section shall 

8 not begin before the end of any period during which the 

9 student is participating in an internship, residency, or fel10 lowship training program directly related to the field of 

11 medicine which the student agrees to enter pursuant to 

12 subsection (d). 

13 ‘‘(d) REQUIREMENTS FOR STUDENTS.—Each agree14 ment under this section for the establishment of a student 

15 loan fund shall provide that the school of medicine or os16 teopathic medicine will make a loan to a student from such 

17 fund only if the student agrees— 

18 ‘‘(1) to enter and complete a residency training 

19 program (in a field of medicine other than primary 

20 health care) not later than a period determined by 

21 the Secretary to be reasonable after the date on 

22 which the student graduates from such school; and 

23 ‘‘(2) to practice medicine through the date on 

24 which the loan is repaid in full. 

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1 ‘‘(e) REQUIREMENTS FOR SCHOOLS.—The provisions 

2 of section 723(b) (regarding graduates in primary health 

3 care) shall not apply to a student loan fund established 

4 under this section. 

5 ‘‘(f) APPLICABILITY OF OTHER PROVISIONS.—Ex6 cept as inconsistent with this section, the provisions of 

7 subpart II shall apply to the program of student loan 

8 funds established under this section to the same extent 

9 and in the same manner as such provisions apply to the 

10 program of student loan funds established under subpart 

11 II. 

12 ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—To 

13 carry out this section, there are authorized to be appro14 priated such sums as may be necessary for fiscal year 

15 2008 and each fiscal year thereafter.’’. 

16 SEC. 809. ESTABLISHMENT OF PERFORMANCE-BASED 

17 QUALITY MEASURES. 

18 Not later than January 1, 2009, the Secretary of 

19 Health and Human Services shall submit to Congress a 

20 proposal for a formalized process for the development of 

21 performance-based quality measures that could be applied 

22 to physicians’ services under the Medicare program. Such 

23 proposal shall be in concert with and agreement with the 

24 Physician Consortium for Performance Improvement and 

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1 shall only utilize measures agreed upon by each physician 

2 specialty group. 

Æ 

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