I

103D CONGRESS

2D SESSION H. R. 4960

To provide health care quality safeguards for consumers of health care

insurance and health care products and services.

IN THE HOUSE OF REPRESENTATIVES

AUGUST 12, 1994

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

on Energy and Commerce

A BILL

To provide health care quality safeguards for consumers of

health care insurance and health care products and services.

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

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Consumer Health

5 Quality Protection Act of 1994’’.
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1 TITLE I—DUTIES OF THE SECRETARY AND

2 THE STATES

3 SEC. 101. RESPONSIBILITIES OF THE SECRETARY.

4 The responsibilities of the Secretary of Health and

5 Human Services (hereinafter referred to as ‘‘the Sec6 retary’’) under this Act are the following:

7 (1) STATE QUALITY MANAGEMENT PROGRAM.—

8 Determination of initial and ongoing compliance of

9 each State health quality management program with

10 the requirements of section 102.

11 (2) NATIONAL QUALITY MANAGEMENT PRO12 GRAM.—Establish a national quality management

13 program (in accordance with section 201).

14 (3) HEALTH QUALITY IMPROVEMENT FOUNDA15 TIONS.—Establishment of health quality improve16 ment foundations (in accordance with section 202).

17 (4) CONSUMER HEALTH CARE ADVOCATE.—Es18 tablishment of consumer health care advocate in

19 each State (in accordance with section 203).

20 (5) NATIONAL CONSUMER REPRESENTATIVE

21 SUPPORT CENTER.—Establishment of a national

22 consumer representative support center (in accord23 ance with section 204).

24 (6) NATIONAL MEASURES OF QUALITY PER25 FORMANCE.—Establishment of national measures of
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1 quality performance for health plans (in accordance

2 with section 205).

3 (7) RELATIVE VALUE SCALE FOR PHARMACY

4 COUNSELING.—Establishment of a relative value

5 scale for the purpose of reimbursing pharmacists for

6 the certain patient counseling services (in accord7 ance with section 206).

8 SEC. 102. RESPONSIBILITIES OF THE STATES.

9 STATE RESPONSIBILITIES.—As a condition of receipt

10 of Federal medical assistance payments under title XIX

11 of the Social Security Act, a State must comply with the

12 following requirements of this section:

13 (1) HEALTH PLANS.—Certifying health plan

14 compliance with the quality standards of section

15 301.

16 (2) MEDICAL LICENSURE BOARD.—Assuring

17 State medical licensure board compliance with the

18 requirements of section 302.

19 TITLE II—NATIONAL HEALTH QUALITY

20 MANAGEMENT PROGRAM

21 SEC. 201. ESTABLISHMENT OF NATIONAL QUALITY MAN22 AGEMENT PROGRAM.

23 (a) IN GENERAL.—Not later than one year after the

24 date of enactment of this Act, the Secretary shall establish

25 and oversee a performance-based program of quality man-
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1 agement and improvement designed to enhance the qual2 ity, appropriateness, and effectiveness of health care items

3 and services, to be known as the national quality manage4 ment program.

5 (b) FUNDING.—

6 (1) IN GENERAL.—Beginning with the first

7 quarter of the first calendar year following enact8 ment of this Act and quarterly thereafter, the Sec9 retary shall collect from each health plan certified

10 under section 301 a fee amounting to 0.25 percent

11 of the premiums received by the plan.

12 (2) FUNDED ACTIVITIES.—Funds collected

13 under the authority of paragraph (1) shall be uti14 lized by the Secretary solely to support the activities

15 described under section 101.

16 SEC. 202. HEALTH QUALITY IMPROVEMENT FOUNDATIONS.

17 (a) IN GENERAL.—The Secretary shall, no later than

18 two years after the date of enactment of this Act, establish

19 a program of grants to eligible organizations to serve as

20 health quality improvement foundations and perform the

21 duties specified in subsection (d) for the population of

22 each State, and shall oversee the operation of such founda23 tions.
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1 (b) ELIGIBILITY.—To be eligible for a grant under

2 this section, entities must demonstrate compliance with

3 the criteria of subparagraphs (1) through (5).

4 (1) GOVERNING BODY.—Each entity shall be

5 governed by a board consisting of health profes6 sionals and public members, no fewer than 51 per7 cent of whom shall be public members.

8 (2) DEFINITION OF PUBLIC MEMBER.—For

9 purposes of this paragraph, the term ‘‘public mem10 ber’’ means an individual who resides in the State

11 and is a person of integrity and good reputation who

12 has lived in the State for at least five years imme13 diately preceding appointment to the board, and has

14 not in the preceding five years been authorized to

15 practice a healing art or had a substantial personal,

16 business, professional, or pecuniary connection with

17 a health plan, healing art or with a medical edu18 cation or health care facility, except as a patient or

19 a potential patient.

20 (3) STAFFING.—Each entity shall be staffed by

21 individuals expert in quality improvement, and ex22 perts in the fields of epidemiology, measurement of

23 risk adjusted health outcomes, use of clinical prac24 tice guidelines, health services data analysis, and

25 provider education.
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1 (4) CONTRACT WITH ACADEMIC HEALTH CEN2 TER.—

3 (A) IN GENERAL.—Each entity shall have

4 a contract with an academic health center to

5 assist in fulfilling the duties described under

6 subsection (d).

7 (B) DEFINITION.—For purposes of this

8 paragraph, an ‘‘academic health center’’ means

9 an entity that—

10 (i) operates a school of medicine or

11 osteopathic medicine accredited by the Li12 aison Committee on Medical Education of

13 the Association of American Medical Col14 leges and the American Medical Associa15 tion, or the American Osteopathic Associa16 tion;

17 (ii) operates or is affiliated with one

18 or more schools of nursing; and

19 (iii) operates or is affiliated with one

20 or more teaching hospitals.

21 (5) CONFLICT OF INTEREST.—

22 (A) IN GENERAL.—An entity seeking to re23 ceive a designation under this section shall be

24 considered a ‘‘disclosing entity’’ for purposes of
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1 section 1124 (42 U.S.C. 1320a–3) of the Social

2 Security Act;

3 (B) Such entity may not—

4 (i) directly or indirectly (as deter5 mined by the regulations promulgated

6 under section 1124(a)(3) of the Social Se7 curity Act) possess an ownership interest

8 of one (1) percent or more in a health care

9 facility, a health plan, or association of

10 such;

11 (ii) own a whole or part interest in

12 any mortgage, deed of trust, note, or other

13 obligation secured (in whole or in part) by

14 a health care facility, health plan, associa15 tion of such, or any of the property or as16 sets thereof, which whole or part interest is

17 equal to or exceeds (1) percent of the total

18 property and assets of the facility, plan, or

19 association; or

20 (iii) utilize officers or members of the

21 governing body more than 10 percent of

22 whom are the officers or members of the

23 governing board of one or more health fa24 cilities, plans, or associations).

25 (c) GRANTS TO ENTITIES.—
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1 (1) IN GENERAL.—The Secretary shall select,

2 through a competitive grantmaking process, no more

3 than one entity to serve as a health quality improve4 ment foundation in each State, and may designate

5 one entity to serve multiple contiguous States.

6 (2) PREFERENCES.—In making its designation,

7 the Secretary shall give preference to an entity—

8 (A) which can demonstrate the capacity to

9 fulfill the duties described under subsection (d)

10 for enrollees of health plans certified under sec11 tion 301, as well as enrollees of title XVIII of

12 the Social Security Act; and

13 (B) for which the primary place of busi14 ness is located in the State within which the

15 functions of the foundation will be conducted,

16 or, if one entity is to be designated to serve

17 multiple States, preference shall be given to an

18 entity for which the primary place of business

19 is located in one of the States.

20 (3) SCOPE OF WORK.—Each grant with an en21 tity under this section shall be pursuant to an agree22 ment providing—

23 (A) the entity shall perform the duties de24 scribed in subsection (d) for the benefit of—
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1 (i) enrollees in health plans certified

2 under section 301,

3 (ii) individuals enrolled under title

4 XVIII of the Social Security Act, and

5 (iii) recipients entitled to benefits

6 under title XIX of the Social Security Act.

7 (B) the Secretary shall evaluate the per8 formance of the entity in carrying out the func9 tions specified in the grant;

10 (C) the grant shall be for a term of four

11 years and shall be renewable, based upon evi12 dence of successful quality improvement per13 formance, without reopening the competitive se14 lection process, except that an entity subject to

15 subsection (e)(3) shall have term(s) limited to

16 two years and shall be subject to competition at

17 the end of each contract period;

18 (D) if the Secretary decides not to renew

19 a grant with a foundation, the foundation shall

20 be notified of the decision at least one hundred

21 and eighty days prior to the expiration of the

22 grant term, and shall be afforded an oppor23 tunity to present information for the purposes

24 of appeal of the decision not to renew the grant;
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1 (E) based on a finding by the Secretary

2 that the foundation has not met or no longer

3 meets the requirements of this section, the Sec4 retary may terminate the grant prior to its ex5 piration upon one hundred and eighty days no6 tice, during which notice period the Secretary

7 shall provide the foundation an opportunity to

8 seek an nonbinding opinion on the Secretary’s

9 finding before a panel of representatives of

10 foundations convened by the Secretary;

11 (F) the entity may terminate the grant

12 upon one hundred and eighty days notice to the

13 Secretary; and

14 (G) the amount of the grant to be allo15 cated under a grant shall consist of a sum nec16 essary to perform the duties under paragraph

17 (d), which may be augmented with additional

18 funds for the performance of research by a

19 foundation selected by the Secretary for exem20 plary performance and the merit of research

21 proposals submitted.

22 (d) DUTIES.—A health quality improvement founda23 tion shall carry out the following duties in the State in

24 which the foundation operates:
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1 (1) QUALITY IMPROVEMENT.—Collaboration

2 with physicians and other health care professionals

3 in ongoing efforts to improve the quality of health

4 care provided to individuals in the State, giving pri5 ority to health conditions and interventions which

6 are likely to produce the greatest impact in prevent7 ing or reducing morbidity, mortality, and functional

8 impairment.

9 (2) OVERSIGHT.—Analyze data obtained under

10 section 205 and other information obtained by the

11 foundation pertaining to health care delivered in the

12 State, for the purpose of—

13 (A) identifying opportunities for quality

14 improvement;

15 (B) documenting that such improvement is

16 being realized; and

17 (C) auditing samples of such information

18 and its source documents to assure the informa19 tion is valid, reliable, and comparable between

20 plans, and to inform recommendations for im21 proving the validity, reliability, and comparabil22 ity of the information.

23 (3) TECHNICAL ASSISTANCE.—Provide tech24 nical assistance to health plans and providers, in25 cluding—
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1 (A) feedback to providers of information

2 on patterns of health care delivery, health sta3 tus, and outcomes;

4 (B) assistance in fulfilling the data report5 ing requirement of section 205;

6 (C) assistance in the development of pa7 tient education systems that enhance patient in8 volvement in decisions relating to their health

9 care;

10 (D) entering into agreements with selected

11 health plans to provide educational programs

12 for health care professionals.

13 (4) ANNUAL REPORT.—Submit to the Secretary

14 and make publicly available an annual report con15 cerning—

16 (A) recommendations for improving the

17 utility of clinical practice guidelines as a means

18 of identifying opportunities for improvement

19 and bringing about quality improvement;

20 (B) recommendations for improving the re21 liability and validity of the national measures of

22 quality performance and consumer survey data

23 described in section 205;

24 (C) selected measures of the health care

25 status of the population of the State, including
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1 a description of activities underway and

2 progress achieved; and

3 (D) a description of activities undertaken

4 during the preceding year pursuant to sub5 section (b)(3) and subsection (d)(3)(D).

6 (5) MULTIPLAN COLLABORATIONS.—Sponsor of

7 statewide and other collaborations involving multiple

8 plans or providers to identify opportunities for qual9 ity improvement, and to bring about improvements

10 in health care.

11 (6) REFERRALS.—

12 (A) IN GENERAL.—If a health quality im13 provement foundation finds, after affording rea14 sonable opportunities for improvement, that a

15 provider or plan—

16 (i) continues to furnish services char17 acterized by underuse, overuse or poor

18 technical quality, or

19 (ii) is unwilling or unable to success20 fully engage in quality improvement activi21 ties related to the services described in

22 subparagraph (A),

23 the foundation shall provide notice of such finding to

24 the officials and entities described in subparagraph

25 (B), and shall make available to such officials and
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1 entities upon request data and information relied

2 upon by the foundation in making the referral.

3 (B) NOTIFICATION.—A finding under

4 clause (i) shall be forwarded—

5 (i) if the finding pertains to a health

6 plan, to the appropriate alliance(s), accred7 itation organization(s), State officials re8 sponsible for plan certification under sec9 tion 301, the consumer health care advo10 cate authorized under section 203, and the

11 public;

12 (ii) if the finding pertains to a pro13 vider, to the appropriate State health facil14 ity or State professional licensure board(s),

15 the consumer health care advocate author16 ized under section 203, and health plan(s)

17 with which the provider is associated.

18 (iii) IMMINENT RISK.—If a foundation

19 identifies a provider who posses an immi20 nent risk to the health of patients receiving

21 or likely to receive health care from the

22 provider, the foundation shall immediately

23 notify the appropriate authorities listed

24 under clause (ii).
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1 (e) LIMITATION ON LIABILITY.—No organization

2 having a grant from the Secretary under this section, and

3 no person who is employed by, or who has a fiduciary rela4 tionship with any such organization, or who furnishes pro5 fessional services to such organization, shall be held by

6 reason of the performance of any duty or activity author7 ized pursuant to this part to have violated any criminal

8 law, or to be civilly liable under any law of the United

9 States or of any State (or political subdivision thereof)

10 provided that the performance of such duty or activity was

11 not conducted in bad faith.

12 SEC. 203 CONSUMER HEALTH CARE ADVOCATE.

13 (a) IN GENERAL.—The Secretary shall, no later than

14 two years after the date of enactment of this Act, make

15 grants to an entity in each State which shall serve as the

16 consumer health care advocate for the population of the

17 State.

18 (b) SELECTION OF GRANTEES.—

19 (1) COMPETITION.—Grants shall be awarded

20 under subsection (a) on a competitive basis to appli21 cants meeting the criteria in paragraph (2).

22 (2) CRITERIA.—In awarding grants under sub23 section (a)—

24 (A) preference shall be given to private or25 ganizations which are exempt from taxation
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1 under section 501(c)(3) or (4) of the Internal

2 Revenue Act of 1986;

3 (B) preference shall be given to organiza4 tions with a governing body which includes rep5 resentation of ethnic and low-income popu6 lations of the State;

7 (C) preference shall be given to an organi8 zation which has previously received, and satis9 factorily performed under the terms of a grant

10 from the Secretary for the purpose of providing

11 health insurance counseling for enrollees under

12 title XVIII of the Social Security Act; and

13 (D) an applicant for a grant under sub14 section (a) shall be ineligible if the applicant is,

15 or is affiliated with (through ownership, man16 agement, or common control), a health plan,

17 provider, State office responsible for health fa18 cilities or health professional licensing or certifi19 cation, health alliance, or association of such

20 entities.

21 (c) GRANT PROVISIONS.—Each grant with an organi22 zation under this section shall provide that—

23 (1) the organization shall perform the duties set

24 forth in subsection (d);
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1 (2) the Secretary shall have access to docu2 ments and personnel necessary to evaluate the effec3 tiveness of the organization in fulfilling the provi4 sions of the grant;

5 (3) the grant shall be for an initial term of four

6 years and shall be renewable thereafter based upon

7 favorable performance without reopening the com8 petitive selection process;

9 (4) if the Secretary intends not to renew a

10 grant to an organization under this section, the or11 ganization shall be notified of the decision at least

12 one hundred and eighty days prior to the expiration

13 of the grant, and be afforded an opportunity to

14 present information for the purpose of appeal;

15 (5) the Secretary may terminate a grant to an

16 organization under this section if it determines that

17 the organization does not meet the requirements of

18 this section, and provides an opportunity for the or19 ganization to appeal its determination;

20 (6) an organization which has received a grant

21 under this section may terminate the grant upon one

22 hundred and eighty days notice to the Secretary;

23 (d) DUTIES.—An organization which has received a

24 grant under this section shall have the following duties—
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1 (1) investigate and resolve complaints made by

2 or on behalf of individuals;

3 (2) provide information, referral and assistance

4 to individuals on the availability of health insurance

5 coverage and health care items and services;

6 (3) identify, investigate and promote solutions

7 to problems arising from public or private practices

8 and policies which adversely affect individuals’ ac9 cess to quality health care, including—

10 (A) marketing of health plans, and

11 (B) accessibility of services, subsidies or

12 other resources;

13 (4) monitor, analyze, and comment on the de14 velopment and implementation of Federal, State, or

15 local laws affecting access to quality health care;

16 (5) facilitate public comment on Federal, State,

17 or local laws affecting access to quality health care;

18 (6) compile and report to the Secretary and na19 tional consumer representative support center data

20 regarding complaints received and actions taken, in

21 a form defined by the Secretary;

22 (7) protect the identity of any complainant, un23 less released from this responsibility by the com24 plainant;
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1 (8) coordinate activities and advocacy with

2 other organizations, including legal assistance pro3 viders, State and local long-term care ombudsman

4 programs, and protection and advocacy programs es5 tablished for persons with disabilities under—

6 (A) part A of the Developmental Disabil7 ities Assistance and Bill of Rights Act (42

8 U.S.C. 6001 et seq.),

9 (B) the Protection and Advocacy for Men10 tally Ill Individuals Act of 1986 (42 U.S.C.

11 10801 et seq.), and

12 (C) the Americans with Disabilities Act;

13 (9) perform such other duties the Secretary

14 may specify.

15 (e) AUTHORITY OF CONSUMER HEALTH CARE ADVO16 CATE.—The consumer health care advocate in each State

17 shall be vested with the following powers and authorities:

18 (1) The advocate may establish local programs

19 with the same powers and authorities, subject to the

20 same restrictions regarding eligibility and conflict of

21 interest.

22 (2) Representatives of the consumer health care

23 advocate shall have access to health care facilities

24 for the purpose of communicating with individuals

25 receiving care on the premises.
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1 (3) Representatives of the consumer health care

2 advocate shall have access to the medical and social

3 records of an individual if the individual, or the legal

4 representative of the individual, has granted permis5 sion to do so.

6 (4) The consumer health care advocate shall

7 have access to, and upon request copies of, all licens8 ing and certification reports and data pertaining to

9 health care providers and developed by a State.

10 (f) LIMITED LIABILITY.—No consumer health care

11 advocate or its local programs or representatives shall be

12 liable under State or Federal law for the good faith per13 formance of official duties.

14 (g) FUNDING.—The Secretary shall provide funding

15 for the entities described under this section through the

16 following mechanisms:

17 (1) BASE FUNDING.—The Secretary shall pro18 vide grants to the consumer health care advocate in

19 each State and the Center described under sub20 section (g) from the proceeds of the assessment

21 under section 201, up to a total of $50,000,000; and

22 (2) VOLUNTARY CONTRIBUTIONS.—The Sec23 retary shall assist States in ensuring that consumer

24 health care advocate entities are permitted to seek

25 voluntary contributions through a prominent solicita-
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1 tion in the enrollment materials distributed by or on

2 behalf of each health plan.

3 SEC. 204 NATIONAL CONSUMER REPRESENTATIVE SUP4 PORT CENTER

5 The Secretary shall, no later than six months after

6 the date of enactment of this Act, make one or more

7 grants of a total amount not exceeding $5,000,000 per

8 annum to establish national consumer representative sup9 port center(s) to assist consumer representatives serving

10 on State medical boards, quality improvement foundation

11 governing boards, and consumer health care advocates in

12 performing their duties. Entities eligible for a grant under

13 this section shall be nonprofit organizations with dem14 onstrated expertise in training and representing diverse

15 consumers of health care insurance, and health care items

16 and services.

17 SEC. 205. NATIONAL MEASURES OF QUALITY PERFORM18 ANCE.

19 (a) IN GENERAL.—The Secretary shall develop a set

20 of national measures of quality performance, which shall

21 be used to assess the provision if health care services and

22 access to such services.

23 (b) SUBJECT OF MEASURES.—National measures of

24 quality performance shall be selected in a manner that

25 provides information on the following subjects:
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1 (1) Access to health care services by consumers;

2 (2) Appropriateness of health care services pro3 vided to consumers;

4 (3) Outcomes of health care services and proce5 dures;

6 (4) Health promotion;

7 (5) Prevention of diseases, disorders, and other

8 health conditions;

9 (6) Consumer satisfaction with care, including

10 satisfaction of consumers who disenroll from health

11 plans and those who utilize services from providers

12 not included in their plan network.

13 (c) SELECTION OF MEASURES.—

14 (1) CONSULTATION.—In developing and select15 ing the national measures of quality performance,

16 the Secretary shall consult with appropriate inter17 ested parties, including—

18 (A) States;

19 (B) health plans;

20 (C) employers and individuals purchasing

21 health care through regional and corporate alli22 ances;

23 (D) health care providers;

24 (E) health care consumers;
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1 (F) the quality improvement foundations

2 established under section 202;

3 (G) the consumer health care advocate es4 tablished under section 203;

5 (H) nationally recognized accreditation or6 ganizations.

7 (2) CRITERIA.—The following criteria shall be

8 used in developing and selecting national measures

9 of quality performance:

10 (A) SIGNIFICANCE.—When a measure re11 lates to a specific disease, disorder, or other

12 health condition, the disease, disorder, or condi13 tion shall be of significance in terms of preva14 lence, morbidity, mortality, or the costs associ15 ated with the prevention, diagnosis, treatment,

16 or clinical management of the disease, disorder,

17 or condition.

18 (B) RANGE OF SERVICES.—The set of

19 measures, taken as a whole, shall be representa20 tive of the range of items and services provided

21 to consumers of health care by health care pro22 viders and suppliers.

23 (C) RELIABILITY AND VALIDITY.—The

24 measures shall be reliable and valid.
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1 (D) UNDUE BURDEN.—The data needed to

2 calculate the measures shall be obtained with3 out undue burden on the entity or individual

4 providing the data.

5 (E) LINKAGE TO HEALTH OUTCOME.—

6 When a measure is a rate of a process of care,

7 the process shall, to the extent practicable, be

8 linked to a health outcome based upon the best

9 available scientific evidence.

10 (F) CONTROL AND RISK ADJUSTMENT.—

11 When a measure of a provider or plan is an

12 outcome of the provision of care, the outcome

13 shall be within the control of the provider or

14 plan and shall be one with respect to which an

15 adequate risk adjustment can be made.

16 (G) PUBLIC HEALTH.—The measures shall

17 incorporate standards identified by the Sec18 retary of Health and Human Services for meet19 ing public health objectives.

20 (d) UPDATING.—The Secretary shall review and up21 date the set of national measures of quality performance

22 annually to reflect changing goals for quality improve23 ment. The Secretary shall establish and maintain a prior24 ity list of performance measures that within a five-year

25 period it intends to consider for inclusion within the set
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1 through the updating process. The Secretary may select

2 different performance measures for inclusion within the

3 set from year to year.

4 (e) CONSUMER SURVEYS.—

5 (1) IN GENERAL.—The Secretary shall conduct

6 periodic surveys of health care consumers to gather

7 information concerning access to care, use of health

8 services, health outcomes, and patient satisfaction.

9 The surveys shall monitor consumer reaction to the

10 implementation of this Act and be designed to assess

11 the impact of this Act on the general population of

12 the United States and potentially vulnerable popu13 lations.

14 (2) SURVEY ADMINISTRATION.—The Secretary

15 shall develop and approve a standard design for the

16 surveys, which shall be administered by the Adminis17 trator for Health Care Policy and Research on a

18 plan-by-plan and State-by-State basis. A State may

19 add survey questions on quality measures of local in20 terest to surveys conducted in the State.

21 (3) SAMPLING STRATEGIES.—The Secretary

22 shall develop sampling strategies that ensure survey

23 samples adequately measure populations considered

24 by the Secretary to be at risk of receiving inad25 equate health care or who may be difficult to reach
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1 through consumer sampling methods, including indi2 viduals who—

3 (A) fail to enroll in a health plan;

4 (B) resign from a plan;

5 (C) are members of a vulnerable popu6 lation, as defined by the Secretary; or

7 (D) have received health care items or

8 services from providers or suppliers which were

9 not members of the network maintained by the

10 plan in which the individual was enrolled.

11 (f) EFFECTIVE DATE.—The requirements of this sec12 tion taken effect upon the date of enactment of this Act,

13 with the first publication for comment of draft perform14 ance measures defined under subsection (a), and the sur15 veys described under subsection (e), to take place no later

16 than two years after the date of enactment of this Act.

17 The Secretary shall publish, for use by the public in evalu18 ating health plans and providers, the first set of perform19 ance measures no later than three years after the date

20 of enactment of this Act.

21 SEC. 206 PAYMENT FOR PHARMACIST COUNSELING.

22 (a) RELATIVE VALUE SCALE FOR EVALUATION AND

23 MANAGEMENT SERVICES BY PHARMACISTS.—The Sec24 retary shall develop and publish, no later than three years

25 from the date of enactment of this Act, a relative value
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1 scale that defines and establishes a numerical relationship

2 among various evaluation and management services per3 formed by pharmacists, taking into account—

4 (1) differences in skill levels and training re5 quired to perform the services;

6 (2) differences in level of risk associated with

7 use of individual drugs or groups of drugs; and

8 (3) differences in the level of risk associated

9 with drug use by certain individuals.

10 (b) REPORT TO CONGRESS.—No later than three

11 years after the date of enactment of this subsection, the

12 Secretary shall provide to Congress a report on the rel13 ative value scale developed under paragraph (1), together

14 with recommendations regarding adoption of such scale by

15 Federal health insurance programs and by health plans

16 certified under section 301.

17 TITLE III—STATE HEALTH QUALITY

18 MANAGEMENT PROGRAMS

19 SEC. 301 CERTIFICATION OF HEALTH PLANS.

20 (a) IN GENERAL.—(1) To be certified by a State, a

21 plan must be determined to be in substantial compliance

22 with the standards described in this section.

23 (2) OVERSIGHT.—The Secretary may conduct onsite

24 inspections and inspect documents generated by or in the

25 possession of a plan, accreditation organization, or State,
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1 to verify the compliance of a plan with the requirements

2 of this section.

3 (b) ACCREDITATION.—A State may accept, in lieu of

4 making its own determination of compliance with these

5 standards, the determination of compliance by an accredi6 tation organization designated by the Secretary as utiliz7 ing a process consistent with subsection (c).

8 (c) PROCESS.—A State or accreditation organization

9 making a determination under subsection (a)—

10 (1) shall verify compliance with each of the

11 standards under this section.

12 (2) shall make available to the public its find13 ings related to a plan’s compliance with each of the

14 standards under this section.

15 (3) may charge plans fees sufficient to cover the

16 cost of assuring compliance with the standards

17 under this section.

18 (d) QUALITY STANDARDS.—

19 (1) QUALITY IMPROVEMENT.—

20 (A) IN GENERAL.—Each health plan shall

21 establish a quality improvement program to sys22 tematically measure, assess and improve en23 rollee health status, patient outcomes, processes

24 of care, and enrollee satisfaction associated with

25 health care provided under the plan.
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1 (B) FUNCTIONS.—Each quality improve2 ment program shall perform the following func3 tions—

4 (i) measure performance of the plan

5 and its member providers, using at least

6 the quality measures developed under sec7 tion 5003, and communicate findings of

8 such monitoring to such providers and plan

9 administrative personnel;

10 (ii) furnish the information required

11 under subtitle B of this title and provide

12 such other reports and information on the

13 quality of care delivered by providers as

14 may be required under this Act;

15 (iii) demonstrate measureable im16 provement in medical outcomes (including

17 morbidity, mortality, functional impair18 ment, and quality of life), as measured by

19 the plan and as assessed by plan enrollees

20 and patients;

21 (iv) establish procedures for—

22 (I) educational intervention when

23 services characterized by underuse,

24 overuse, or poor technical quality are

25 provided, and
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1 (II) referral to State licensure

2 board or other appropriate regulatory

3 authorities if the interventions de4 scribed in subclause (I) are unsuccess5 ful; and

6 (v) cooperate with the health quality

7 improvement foundation established under

8 section 5008, including providing access to

9 appropriate medical records and quality

10 performance data upon the request of such

11 foundation, and undertaking investigation

12 of quality problems and opportunities for

13 quality improvement identified by the foun14 dation.

15 (2) COMMUNITY HEALTH IMPROVEMENT.—

16 (A) IN GENERAL.—Each health plan shall

17 establish a community health improvement pro18 gram that meets the requirements of subpara19 graph (C) for the benefit of—

20 (i) plan enrollees; and

21 (ii) uninsured individuals residing in

22 the geographic area served by the plan, or,

23 with respect to self-insured plans, the geo24 graphic area served by insured plans in
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1 which the plan’s principle place of business

2 is located.

3 (B) REQUIREMENTS.—A community

4 health improvement program shall consist of:

5 (i) identification of baseline health

6 status problems in the population ad7 dressed by the program;

8 (ii) development of measures to ad9 dress such problems in consultation with

10 local public health officials, community or11 ganizations, and other health plans operat12 ing in the service area of the plan;

13 (iii) implementation of measures de14 veloped under clause (ii);

15 (iv) evaluation of the effectiveness of

16 such measures in improvement of health

17 status in the population; and

18 (v) an annual report of the results of

19 the evaluation.

20 (3) UTILIZATION MANAGEMENT.—

21 (A) IN GENERAL.—The utilization man22 agement activities of a plan are subject to the

23 requirements of this paragraph to the extent

24 such activities involve case by case review of

25 care proposed for or provided to individual pa-
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1 tients. A plan may satisfy the requirements of

2 subparagraphs (C) through (G) by conducting

3 its utilization management efforts through its

4 quality improvement program.

5 (B) Disclosure of utilization management

6 criteria upon the request of practitioners or en7 rollees.

8 (C) Inclusion of utilization management

9 criteria to identify underutilization as well as

10 overutilization.

11 (D) Systematic updating of utilization re12 view criteria to reflect current scientific and

13 medical findings.

14 (E) Supervision of utilization determina15 tions by qualified medical professionals.

16 (F) Consistency in the application of utili17 zation review criteria.

18 (G) Personnel responsible for utilization

19 management shall—

20 (i) monitor the outcome of utilization

21 management decisions which are appealed

22 by an enrollee or provider, and

23 (ii) revise utilization management cri24 teria and procedures to eliminate future

25 reversed decisions to the extent practicable,
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1 except where such reversals were not the

2 result of deficiencies in such criteria or

3 procedures.

4 (4) PHYSICIAN INCENTIVE PLANS.—

5 (A) IN GENERAL.—A health plan may es6 tablish and operate a physician incentive plan

7 (as defined in subparagraph (B)) if—

8 (i) the requirements specified in

9 clauses (i) through (iii) of section

10 1876(i)(8)(A) of the Social Security Act

11 are met (in the same manner as they apply

12 to eligible organizations under section

13 1876 of such Act); and

14 (ii) the plan prominently discloses to

15 the public, in its enrollment information,

16 the nature of the incentives provided to

17 providers under the plan.

18 (B) DEFINITION.—For purposes of this

19 paragraph, the term ‘‘physician incentive plan’’

20 means any compensation or other financial ar21 rangement between a health plan and a physi22 cian or physician group that may directly or in23 directly have the effect of reducing or limiting

24 services provided with respect to individuals en25 rolled under the plan.
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1 (5) ENROLLEE RIGHTS AND RESPONSIBIL2 ITIES.—

3 (A) IN GENERAL.—A plan shall provide to

4 all enrollees written information, translated for

5 the benefit of any population representing 5

6 percent or more of the plan’s enrollees whose

7 primary language is other than English, de8 scribing—

9 (i) enrollee rights and responsibilities,

10 including the grievance and appeals rights

11 defined in subpart C of this title, the

12 rights defined in subparagraphs (B)

13 through (H), and

14 (ii) any limitations of coverage, exclu15 sions, and out-of-pocket costs (including

16 any copayment, coinsurance, deductible)

17 and any limit(s) on out-of-pocket costs.

18 (B) WAIVER OF RIGHTS.—No health plan

19 or provider may require an individual or en20 rollee to waive the rights set forth in this para21 graph as a condition of enrollment in a plan,

22 admission to a health care facility, or provision

23 of treatment.

24 (C) RIGHT TO REFUSE TREATMENT.—

25 Each enrollee shall have the right—
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1 (i) to refuse any health care item or

2 service;

3 (ii) to refuse to receive any health

4 care item or service from a specified pro5 vider;

6 (iii) to leave the premises of any pro7 vider, except as otherwise provided under

8 law;

9 (iv) to refuse participation in experi10 mental research, and to have either a re11 fusal or consent documented in the medical

12 record, except the (HHS) Secretary may

13 define in regulations circumstances under

14 which obtaining consent directly from a pa15 tient is not possible; and

16 (v) to receive an explanation of any

17 available alternative item, service, or pro18 vider, and any likely medical consequences

19 of the exercise of the rights described in

20 clauses (i)–(iv).

21 (D) RIGHT TO PARTICIPATE IN PLANNING

22 TREATMENT.—Enrollees shall have the right to

23 participate in the planning of their health care,

24 including the opportunity to discuss treatment

25 alternatives with providers and to be rep-
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1 resented in such discussions by a family mem2 ber or other chosen representative.

3 (E) RIGHT TO CHOOSE PRIMARY CARE

4 PHYSICIAN.—Each plan shall permit enrollees

5 to choose a primary care physician from among

6 providers who are members of the plan, and

7 permit enrollees to change physicians upon re8 quest.

9 (F) RIGHT TO PRIVACY.—Enrollees shall

10 have the right—

11 (i) to privacy in regard to their health

12 care during discussion or consultation

13 among providers regarding their care,

14 physical examination, and treatment; and

15 (ii) while admitted to a health facility,

16 to associate and communicate privately

17 with persons of their choice, including

18 being afforded opportunities to commu19 nicate privately with a representative of

20 the consumer ombudsman or protection

21 and advocacy organization, upon the re22 quest of such representative.

23 (G) RIGHT TO MEDICAL RECORDS.—En24 rollees shall have a right to review and, for a
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1 nominal charge, copy, their own medical records

2 during business hours.

3 (H) RIGHT TO CONFIDENTIALITY OF

4 RECORDS.—Enrollees shall be assured confiden5 tial treatment of their medical records, and

6 shall be afforded the opportunity to approve or

7 refuse their release to any individual other than

8 providers involved in their care, except the Sec9 retary, entities authorized under section 5008

10 of this Act, or others granted access to such

11 records by law.

12 (6) PRACTITIONER CREDENTIALING AND COM13 PETENCY.—Each health plan shall—

14 (A) establish an ongoing credentialing and

15 recredentialing process for all physicians and

16 other licensed practitioners which are members

17 of the plan;

18 (B) require practitioners applying for

19 membership to complete an application and

20 statement attesting to their professional stand21 ing and the accuracy of all information pro22 vided;

23 (C) assure the demonstrated competence of

24 member practitioners to perform the duties

25 under the plan’s membership agreement, and
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1 establish policies and procedures for educational

2 intervention or reduction, suspension, or termi3 nation of privileges of practitioners failing to

4 demonstrate competence.

5 (7) INFORMATION MANAGEMENT.—Each health

6 plan shall—

7 (A) protect the confidentiality and security

8 of information identifying any individual en9 rollee;

10 (B) standardize throughout the health plan

11 and its member providers, to the extent prac12 ticable and consistent with the requirements of

13 section 205, data sets, codes, definitions, classi14 fications, and terminology.

15 (8) DISCLOSURES RELATED TO MARKETING IN16 FORMATION.—

17 (A) Each health plan which sponsors or

18 distributes any comparative information per19 taining to plans marketed in an area shall

20 prominently disclose in such information—

21 (i) the identity of the plan (or related

22 organization) sponsoring or distributing

23 the comparative information, and whether

24 the performance of the plan (or organiza25 tion) is included in the comparative infor-
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1 mation being sponsored or distributed by

2 such plan; and

3 (ii) if clinical outcomes or other clini4 cal performance data are included in such

5 information, whether such data were ad6 justed to reflect the health status and se7 verity of illness of enrollees or patients in8 cluded in such comparisons, and the meth9 od by which any severity adjustment was

10 accomplished.

11 (B) Enrollment materials provided to po12 tential enrollees by each health plan shall make

13 a prominent disclosure of the features, avail14 ability, cost sharing and the additional premium

15 cost (if any) associated with purchase of the

16 self-referral option described in paragraph (11).

17 (9) COUNSELING REQUIREMENTS FOR PHAR18 MACIES.—Each health plan shall ensure that no

19 pharmacy may receive payment from the plan for

20 dispensing a covered outpatient drug unless the

21 pharmacy agrees that a pharmacist employed by the

22 pharmacy will ask individuals enrolled in the plan

23 who receive a covered outpatient drug from the

24 pharmacy questions regarding—

25 (A) the appropriate use of the drug,
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1 (B) major potential interactions between

2 the drug and other drugs used by the individ3 ual, and

4 (C) other questions necessary to determine,

5 in the professional judgment of the phar6 macist—

7 (i) whether the individual understands

8 and is likely to comply with instructions

9 for the safe and effective use of such

10 drugs, and

11 (ii) if any counseling or other action

12 by the pharmacist is needed.

13 (10) VOLUNTARY CONTRIBUTIONS.—Each

14 health plan shall, upon the request of the consumer

15 health care advocate described under section 203—

16 (A) publish in a prominent location in its

17 enrollment document a solicitation for voluntary

18 contributions for the consumer health care ad19 vocate designated by the Secretary to serve the

20 State; and

21 (B) collect such contributions, through the

22 same mechanism as periodic premium payments

23 of the enrollee are collected, and forward them

24 to the consumer health care advocate no less

25 frequently than monthly.
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1 (11) POINT OF SERVICE OPTION.—

2 (A) IN GENERAL.—Each health plan which

3 utilizes a network of providers or suppliers shall

4 offer potential enrollees a point of service op5 tion, permitting such enrollees to receive all

6 covered items and services from suppliers and

7 providers that are not members of the plan’s

8 network, subject to the conditions described in

9 paragraphs (B) through (D).

10 (B) COST SHARING.—For items and serv11 ices received from out-of-network providers or

12 suppliers, enrollees who have purchased the

13 point of service option shall be subject to—

14 (i) a deductible not to exceed $200,

15 (ii) coinsurance at a rate no greater

16 than 150 percent of the coinsurance rate

17 established for items and services pur18 chased through the plan’s network,

19 except that for individuals with incomes below

20 150 percent of the applicable poverty level, the

21 Secretary shall establish a deductible and coin22 surance level which is higher than the amounts

23 paid by such individuals for items and services

24 received from network providers and suppliers,
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1 but which will not pose an unreasonable barrier

2 to exercise of the point of service option.

3 (C) SELF-REFERRAL.—With respect to an

4 enrollee who has purchased the point of service

5 option, no plan may require a referral from a

6 network provider as a precondition of coverage

7 of out-of-network items and services.

8 (D) MEDICAL NECESSITY.—A plan may

9 deny payment for items or services received

10 from an out-of-network provider or supplier if

11 such items or services were not medically nec12 essary.

13 SEC. 302. STANDARDS FOR STATE MEDICAL BOARDS.

14 (a) REQUIREMENTS FOR STATE BOARD OF MEDICAL

15 EXAMINERS.—

16 (1) PUBLIC ACCOUNTABILITY.—Each State

17 Board of Medical Examiners shall make available to

18 the public upon request:

19 (A) a description of any final actions (in20 cluding those described in paragraph (4)(E))

21 taken by the Board with respect to a physician;

22 (B) an annual performance report indicat23 ing the number and type of investigations un24 dertaken and actions taken by the Board dur25 ing the preceding year.
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1 (2) COMPOSITION OF BOARD OF MEDICAL EX2 AMINERS AND COMMITTEES.—Each State Board

3 shall be structured so as to include:

4 (A) public members in sufficient numbers

5 that no fewer than fifty percent of board mem6 bers are public members;

7 (B) in the membership of each committee

8 or subdivision of the board, at least one public

9 member.

10 (3) FUNDING.—

11 (A) Each State medical licensure board

12 shall be adequately funded to fulfill the require13 ments of this section.

14 (B) All revenue generated by medical licen15 sure fees shall be used to fund the activities of

16 the State medical board, to the extent necessary

17 to fulfill the requirement of subparagraph (A).

18 (4) INVESTIGATIONS.—A State medical licen19 sure board shall—

20 (A) investigate any credible evidence which

21 alleges that a physician—

22 (i) is incompetent to perform the du23 ties reflected in the physician’s license;

24 (ii) engages in unprofessional conduct

25 that jeopardized patients;
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1 (iii) is mentally or physically unable to

2 safely and effectively perform the duties

3 reflected in the physician’s license;

4 (B) employ or arrange for the availability

5 of personnel with the appropriate medical train6 ing necessary to investigate and document find7 ings related to allegations described in subpara8 graph (A);

9 (C) investigate allegations submitted to the

10 board by a health quality improvement founda11 tion established under section 202.

12 (D) possess the following investigative

13 powers:

14 (i) the power to subpoena documents

15 and individuals possessing information rel16 evant to investigations;

17 (ii) the power to require professional

18 competency examinations upon reasonable

19 suspicion of incompetence;

20 (iii) the power to obtain the involun21 tary temporary summary suspension of a

22 licensee from practice, based upon a rea23 sonable belief that the licensee poses an

24 imminent threat to patient health, followed

25 as soon as practicable by a formal hearing;
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1 (E) possess the following authorities relat2 ed to disciplinary action:

3 (i) revocation or suspension of a li4 cense;

5 (ii) restriction or limitation of the ex6 tent, scope, or type of practice, including

7 the authority to order such limited practice

8 to be conducted under the supervision of

9 another licensee;

10 (iii) imposition of civil penalties;

11 (iv) issuance of a warning or rep12 rimand;

13 (v) probation with or without condi14 tions, such as submission to treatment,

15 continuing education, or reexamination;

16 (vi) the authority to condition a rein17 statement of a license or removal of license

18 limitations upon the licensee obtaining

19 minimum results on one or more forms of

20 competency examination, and

21 (vii) assessment of the reasonable

22 costs of investigation, hearings or reviews,

23 and supervision of practice.

24 (b) ELIGIBILITY FOR GRANTS.—
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1 (1) IN GENERAL.—The Secretary may make a

2 grant to a State Board of Medical Examiners for

3 any purpose related to its duties under this section,

4 or for demonstration projects, if such Board dem5 onstrates it is eligible under paragraph (2).

6 (2) ELIGIBILITY.—A State Board of Medical

7 Examiners is eligible for a grant under paragraph

8 (1) if the Secretary determines that the Board is in

9 substantial compliance with this section and the cur10 rent model standards established by the Federation

11 of State Medical Boards.

12 (3) CONSTRUCTION.—If any of the model

13 standards referred to in paragraph (2) are inconsist14 ent with the provisions of this section, the Sec15 retary’s determination of eligibility shall be based

16 upon on compliance with the requirements of this

17 section.

18 (c) DEFINITIONS.—

19 (1) For purposes of this section, a ‘‘Board of

20 Medical Examiners’’ shall have the meaning given in

21 section 431(14) of the Health Care Quality Improve22 ment Act of 1986.

23 (2) For purposes of this section, a ‘‘public

24 member’’ means an individual who resides in the

25 State and is a person of integrity and good reputa-
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1 tion who has lived in the State for at least five years

2 immediately preceding appointment to the Board,

3 and has never been authorized to practice a healing

4 art, and has never had a substantial personal, busi5 ness, professional, or pecuniary connection with a

6 healing art or with a medical education or health

7 care facility, except as a patient or a potential

8 patient.

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