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[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2400 Introduced in House (IH)]

104th CONGRESS
  1st Session
                                H. R. 2400

 To establish standards for health plan relationships with enrollees, 
                  health professionals, and providers.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                           September 27, 1995

  Mr. Norwood (for himself and Mr. Brewster) introduced the following 
         bill; which was referred to the Committee on Commerce

_______________________________________________________________________

                                 A BILL

 
 To establish standards for health plan relationships with enrollees, 
                  health professionals, and providers.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Family Health Care 
Fairness Act of 1995''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
                TITLE I--DEFINITIONS; GENERAL PROVISIONS

Sec. 101. Definitions.
Sec. 102. Certification of health plans.
Sec. 103. Effect on certain State laws.
                TITLE II--CERTIFICATION OF HEALTH PLANS

Sec. 201. Enrollee access to care.
Sec. 202. Enrollee choice of health professionals and providers.
Sec. 203. Nondiscrimination; equitable access to networks.
Sec. 204. Development of plan policies.
Sec. 205. Due process for enrollees.
Sec. 206. Due process for health professionals and providers.
Sec. 207. Information reporting and disclosure by network plans.
Sec. 208. Other health plan requirements.
Sec. 209. Quality assurance program; case review.
Sec. 210. Related provisions.
                         TITLE III--ENFORCEMENT

Sec. 301. Health plan standards.
Sec. 302. Health plan liability.

                TITLE I--DEFINITIONS; GENERAL PROVISIONS

SEC. 101. DEFINITIONS.

    For purposes of this Act:
            (1) Emergency medical condition.--The term ``emergency 
        medical condition'' means a medical condition (including 
        emergency labor and delivery) manifesting itself by acute 
        symptoms of sufficient severity (including severe pain) such 
        that the absence of immediate medical attention could 
        reasonably be expected to result in--
                    (A) placing the patient's health in serious 
                jeopardy,
                    (B) serious impairment to bodily functions, or
                    (C) serious dysfunction of any bodily organ or 
                part.
            (2) Emergency services.--The term ``emergency services'' 
        means health care items and services that are necessary for the 
        treatment of an emergency medical condition.
            (3) Enrollee.--The term ``enrollee'' means, with respect to 
        a health plan, an individual enrolled with the health plan.
            (4) Enrollee with special health care needs.--The term 
        ``enrollee with special health care needs'' means an enrollee 
        who is an individual or a member of a family that includes an 
        individual with a disability or chronic condition.
                    (A) For purposes of section 202(c)(2)(A), relating 
                to the Point-of-Service Option, such enrollee shall be 
                additionally defined as having an adjusted gross income 
                that does not exceed 250 percent of the official 
                poverty line (as defined by the Office of Management 
                and Budget, and revised annually in accordance with 
                section 673(2) of the Omnibus Budget Reconciliation Act 
                of 1981) applicable to a family of the size involved.
            (5) Health plan.--The term ``health plan'' or ``plan'' 
        refers to any plan or arrangement that provides, or pays the 
        cost of, health benefits, whether through insurance, 
        reimbursement, or otherwise.
            (6) Health professional.--The term ``health professional'' 
        means only an individual who is licensed, certified, 
        accredited, or otherwise credentialed to provide health care 
        items and services as authorized by State law (or a State 
        regulatory mechanism provided by State law).
            (7) Individually identifiable information.--The term 
        ``individually identifiable information'' means, with respect 
        to an enrollee, a health professional, or a provider, any 
        information, whether oral or recorded in any medium or form, 
        that identifies or can readily be associated with the identity 
        of the enrollee, the health professional, or the provider.
            (8) Medically underserved area.--The term ``medically 
        underserved area'' means an area that is designated as a health 
        professional shortage area under section 332 of the Public 
        Health Service Act or as a medically underserved area for 
        purposes of section 330 or 1302(7) of such Act.
            (9) Network.--The term ``network'' means, with respect to a 
        network plan, the participating health professionals and 
        providers through whom the plan provides health care items and 
        services to enrollees.
            (10) Network plan.--The term ``network plan'' means a 
        health plan that provides or arranges for the provision of 
        health care items and services to enrollees through 
        participating health professionals and providers.
            (11) Participating.--The term ``participating'' means, with 
        respect to a health professional or provider, a health 
        professional or provider that provides health care items and 
        services to enrollees of a network plan under an agreement with 
        the plan.
            (12) Provider.--The term ``provider'' means a health 
        organization, health facility, or health agency that is 
        licensed, certified, credentialed, or otherwise authorized to 
        provide health care items and services under applicable State 
        law.
            (13) Rural area.--The term ``rural area'' means an area 
        that is not within a Standard Metropolitan Statistical Area or 
        a New England County Metropolitan Area (as defined by the 
        Office of Management and Budget).
            (14) Secretary.--The term ``Secretary'' means the Secretary 
        of Health and Human Services.
            (15) Service area.--The term ``service area'' means, with 
        respect to a health plan, the geographic area served by the 
        plan.
            (16) Specialized treatment expertise.--The term 
        ``specialized treatment expertise'' means--
                    (A) expertise in diagnosing and treating unusual 
                diseases and conditions,
                    (B) diagnosing and treating diseases and conditions 
                that are unusually difficult to diagnose or treat, and
                    (C) providing other specialized health care.
            (17) Urgent care services.--The term ``urgent care 
        services'' means health care items and services that are 
        necessary for the treatment of a condition that--
                    (A) is not an emergency medical condition,
                    (B) requires prompt medical or clinical treatment, 
                and
                    (C) poses a danger to the patient if not treated in 
                a timely manner (as defined by the Secretary).
            (18) Utilization review.--The term ``utilization review'' 
        means prospective, concurrent, or retrospective review of 
        health care items and services for medical necessity, 
        appropriateness, or quality of care that includes 
        preauthorization requirements for coverage of such items and 
        services.

SEC. 102. CERTIFICATION OF HEALTH PLANS.

    (a) In General.--The Secretary, shall establish a process under 
which--
            (1) a health plan may apply to be certified under this Act;
            (2) such certification is periodically reviewed; and
            (3) such certification is terminated or not renewed if the 
        health plan fails substantially to meet the requirements of 
        this Act.
To the extent practicable, the process shall be the same as the process 
used to determine if an entity is an eligible organization under 
section 1876 of the Social Security Act. To the extent the Secretary 
does not use that process, the Secretary shall submit a report to 
Congress that explains the reasons for the differences.
    (b) Conditions of Certification.--The Secretary shall certify a 
health plan under this Act if the Secretary finds that the plan meets 
the applicable requirements of--
            (1) section 201 (relating to enrollee access to care);
            (2) section 202 (relating to enrollee choice for network 
        plans);
            (3) section 203 (relating to nondiscrimination and health 
        professional and provider equity);
            (4) section 204 (relating to development of plan policies);
            (5) section 205 (relating to due process for enrollees);
            (6) section 206 (relating to due process for health 
        professionals and providers);
            (7) section 207 (relating to information reporting and 
        disclosure by network plans);
            (8) section 208 (relating to other health plan 
        requirements), and
            (9) section 209 (relating to quality assurance program and 
        case review).

SEC. 103. EFFECT ON CERTAIN STATE LAWS.

    Nothing in this Act shall be construed as preempting or otherwise 
superseding any State law that requires--
            (1) a health plan to cover any item or service furnished by 
        a health professional or provider belonging to a category, 
        class, or type of health professional or provider that is 
        authorized under State law to provide the item or service if 
        the plan covers such item or service when furnished by a health 
        professional or provider belonging to another such category, 
        class, or type;
            (2) a network plan to include as a participating health 
        professional or provider any health professional or provider 
        that accepts the terms and conditions established by the plan 
        for other participating providers; or
            (3) a health plan to permit enrollees access to a specified 
        category, class, or type of health professional or provider 
        without a referral from a physician.

                TITLE II--CERTIFICATION OF HEALTH PLANS

SEC. 201. ENROLLEE ACCESS TO CARE.

    (a) In General.--A health plan meets the requirements of this 
section if the plan meets--
            (1) the general access requirements of subsection (b);
            (2) the requirements for access to emergency and urgent 
        care services of subsection (c); and
            (3) in the case of a network plan--
                    (A) the requirements for access to specialized 
                services of subsection (d); and
                    (B) the requirements of subsection (e) relating to 
                incentive plans.
    (b) General Access.--
            (1) In general.--Subject to paragraphs (2), (3), and (4), a 
        health plan meets the requirements of this subsection if the 
        plan establishes and maintains adequate arrangements with a 
        sufficient number, mix, and distribution of health 
        professionals and providers to assure that covered items and 
        services are available and accessible to each enrollee--
                    (A) in the service area of the plan;
                    (B) in a variety of sites of service;
                    (C) with reasonable promptness (including 
                reasonable hours of operation and after-hours 
                services);
                    (D) with reasonable proximity to the residences and 
                workplaces of enrollees; and
                    (E) in a manner that--
                            (i) takes into account the diverse needs of 
                        enrollees, and
                            (ii) reasonably assures continuity of care.
            (2) Exclusive contracts.--A health plan that has an 
        arrangement with only 1 provider to furnish a particular 
        service or category of services to enrollees may not be treated 
        as meeting the requirements of this subsection unless such 
        provider is the only provider of such service or category of 
        service in the service area of the plan and otherwise meets the 
        requirements of this Act.
            (3) Rural and underserved areas.--A health plan that serves 
        a geographic area that is rural or medically underserved shall 
        be treated as meeting the requirement that it have a sufficient 
        number, mix, and distribution of health professionals and 
        providers with respect to such area if the plan--
                    (A) has arrangements with a sufficient number of 
                health professionals and providers in those categories 
                of health professionals and providers specified by the 
                Secretary as having a history of serving rural or 
                medically underserved areas, or
                    (B) meets such other conditions as the Secretary 
                may establish.
            (4) Rule of construction.--Nothing in this subsection shall 
        be construed as requiring a health plan to have arrangements 
        that conflict with its responsibilities to establish measures 
        designed to maintain quality and control costs.
    (c) Emergency and Urgent Care.--A health plan meets the 
requirements of this subsection if the plan--
            (1) assures the availability and accessibility of medically 
        or clinically necessary emergency services and urgent care 
        services within the service area of the plan 24 hours a day, 7 
        days a week;
            (2) requires no preauthorization for items and services 
        furnished in a hospital emergency department to an enrollee 
        with symptoms that reasonably suggest an emergency medical 
        condition (including items and services described in paragraph 
        (3)(C));
            (3) covers (and makes reasonable payments for)--
                    (A) emergency services,
                    (B) services that are not emergency services but 
                are described in paragraph (2),
                    (C) medical screening examinations and other 
                ancillary services necessary to determine if a medical 
                condition is an emergency medical condition, and
                    (D) urgent care services,
        without regard to whether the health professional or provider 
        furnishing such services has a contractual (or other) 
        arrangement with the plan; and
            (4) make preauthorization determinations for--
                    (A) services that are furnished in a hospital 
                emergency department (other than services described in 
                paragraph (3)), and
                    (B) urgent care services,
        within the time periods specified in (or pursuant to) section 
        205(b)(8).
    (d) Specialized Services.--
            (1) In general.--A network plan meets the requirement of 
        this subsection if the plan demonstrates that enrollees have 
        access to specialized treatment expertise when such treatment 
        is medically or clinically indicated in the professional 
        judgment of the treating health professional, in consultation 
        with the enrollee.
            (2) Method of meeting requirement.--A network plan may meet 
        the requirement of this subsection by entering into agreements 
        with, and demonstrating sufficient referrals to, centers of 
        specialized treatment expertise designated by the Secretary.
    (e) Incentive Plans.--A network plan meets the requirements of this 
subsection if any health professional or provider incentive plan 
operated by the plan meets the requirements of section 1876(i)(8)(A) of 
the Social Security Act.

SEC. 202. ENROLLEE CHOICE OF HEALTH PROFESSIONALS AND PROVIDERS.

    (a) In General.--A health plan meets the requirements of this 
section if the plan meets--
            (1) the requirement of subsection (b) that enrollees have a 
        choice of personal health professional;
            (2) the requirement of subsection (c) that a plan cover 
        services furnished by out-of-network providers; and
            (3) the requirements of subsection (d) that the plan assure 
        continuity of care.
    (b) Choice of Personal Health Professional.--The requirement of 
this subsection is that a network plan permit each enrollee--
            (1) to select a personal health professional from among the 
        participating health professionals of the plan, and
            (2) to change that selection as appropriate.
    (c) Point-of-Service Option.--
            (1) In general.--The requirement of this subsection is that 
        a network plan--
                    (A) cover items and services furnished to an 
                enrollee by a health professional or provider that is 
                not a participating health professional or provider; 
                and
                    (B) establish cost-sharing requirements for items 
                and services described in subparagraph (A) that do not 
                exceed the limits on such cost sharing established 
                under paragraph (2).
            (2) Limits.--The Secretary shall establish--
                    (A) a schedule of limits on cost sharing for items 
                and services described in paragraph (1)(A) for 
                enrollees with special health care needs or a chronic 
                condition, as defined in section 101(4)(A), and
                    (B) a schedule of limits on cost sharing for such 
                items and services for other enrollees.
        The limits established under subparagraph (A) shall, on 
        average, provide for cost-sharing requirements that are at 
        least 40 percent lower than the limits established under 
        subparagraph (B).
    (d) Continuity of Care.--The requirements of this subsection are 
that a network plan--
            (1) ensure that any process established by the plan to 
        coordinate care and control costs does not create an undue 
        burden for enrollees with special health care needs or chronic 
        conditions;
            (2) ensure direct access to relevant specialists for the 
        continued care of such enrollees when medically or clinically 
        indicated in the judgment of the treating health professional, 
in consultation with the enrollee;
            (3) in the case of an enrollee with special health care 
        needs or a chronic condition, determine whether, based on the 
        judgment of the treating health professional, in consultation 
        with the enrollee, it is medically or clinically necessary or 
        appropriate to use a specialist or a care coordinator from an 
        interdisciplinary team to ensure continuity of care; and
            (4) in circumstances under which a change of health 
        professional or provider might disrupt the continuity of care 
        for an enrollee, such as--
                    (A) hospitalization, or
                    (B) dependency on high-technology home medical 
                equipment,
        provide for continued coverage of items and services furnished 
        by the health professional or provider that was treating the 
        enrollee before such change for a reasonable period of time (as 
        specified by the Secretary) after such change would otherwise 
        occur.
For purposes of paragraph (4), the Secretary shall specify such 
reasonable period of time, ranging from no fewer than 1 to no greater 
than 150 days (or not greater than 60 days after delivery in the case 
of a pregnancy), with extension of such a period permitted in the cases 
of medical necessity. For purposes of such paragraph a change of health 
professional or provider may be due to changes in the membership of a 
plan's health professional and provider network, changes in the health 
plan made available by an employer, and other similar circumstances 
specified by the Secretary as beyond the control of an enrollee.

SEC. 203. NONDISCRIMINATION; EQUITABLE ACCESS TO NETWORKS.

    (a) In General.--A health plan meets the requirements of this 
section if the plan--
            (1) meets the requirement of subsection (b) that the plan 
        not discriminate;
            (2) in the case of a network plan, meets the requirement of 
        subsection (c) that the plan not discriminate in the selection 
        of providers and health professionals; and
            (3) meets the requirement of subsection (d) that the plan 
        not discriminate in the payment of health professionals and 
        providers.
    (b) Nondiscrimination.--No health plan may discriminate (directly 
or through contractual arrangements) in any activity, including the 
selection of a service area, that has the effect of discriminating 
against an individual on the basis of race, national origin, gender, 
language, socioeconomic status, age, disability, health status, or 
anticipated need for health services.
    (c) Nondiscrimination in Selection of Network Members.--The 
requirement of this subsection is that a network plan does not 
discriminate in selecting the members of its health professional and 
provider network (or in establishing the terms and conditions for 
membership in such network) on the basis of--
            (1) the race, national origin, gender, language, age or 
        disability of the health professional;
            (2) the socioeconomic status, disability, health status, or 
        anticipated need for health services of the patients of a 
        health professional or provider; or
            (3) the health professional or provider's lack of 
        affiliation with, or admitting privileges at, a hospital 
        (unless such lack of affiliation is a result of infractions of 
        quality standards and is not due to a provider's type of 
        license).
    (d) Nondiscrimination in Access to Health Plans.--A health plan 
meets the requirements of this subsection if the plan--
            (1) does not--
                    (A) in the case of a network plan, discriminate in 
                participation of, and
                    (B) in the case of a health plan that is not a 
                network plan, deny reimbursement or indemnification to,
        a health professional who is acting within the scope of the 
        health professional's license under applicable State law solely 
        on the basis of such license or certification; and
            (2) does not--
                    (A) in the case of a network plan, discriminate in 
                participation of, and
                    (B) in the case of a health plan that is not a 
                network plan, deny reimbursement or indemnification to,
        a provider that is providing services that are within the scope 
        of services that the provider is authorized to provide under 
        State law.

SEC. 204. DEVELOPMENT OF PLAN POLICIES.

    The requirement of this section is that a network plan establish 
mechanisms to incorporate the recommendations, suggestions, and views 
of enrollees and participating health professionals and providers 
into--
            (1) the medical policies of the plan (including policies 
        relating to coverage of new technologies, treatments, and 
        procedures);
            (2) the utilization review criteria and procedures of the 
        plan;
            (3) the quality and credentialing criteria of the plan; and
            (4) the medical management procedures of the plan.

SEC. 205. DUE PROCESS FOR ENROLLEES.

    (a) In General.--A health plan meets the requirements of this 
section if the plan meets--
            (1) the requirements of subsection (b) relating to 
        utilization review and payment of claims;
            (2) the requirements of subsection (c) relating to external 
        appeals; and
            (3) the requirements of subsection (d) relating to internal 
        grievance procedures.
    (b) Utilization Review.--The requirements of this subsection are 
that the utilization review program of a health plan--
            (1) is developed (including any screening criteria used by 
        such program) with the involvement of participating health 
        professionals and providers;
            (2) to the extent consistent with the protection of 
        proprietary business information (as defined for purposes of 
        section 552 of title 5, United States Code), releases, upon 
        request, to affected health professionals, providers, and 
        enrollees the screening criteria, weighting elements, and 
        computer algorithms used in reviews and a description of the 
        method by which they were developed;
            (3) uniformly applies review criteria that are based on 
        sound scientific principles and the most recent medical 
        evidence;
            (4) uses licensed, certified, or otherwise credentialed 
        health professionals to make review determinations (and for 
        services requiring specialized training for their delivery, 
        uses a health professional who is qualified through equivalent 
        specialized training);
            (5) subject to reasonable safeguards specified by the 
        Secretary, discloses to health professionals and providers, 
        upon request, the names and credentials of individuals 
        conducting utilization review;
            (6) does not compensate individuals conducting utilization 
        review for denials of payment or coverage of benefits;
            (7) complies with the requirement of section 201(c)(2) that 
        preauthorization not be required for emergency and related 
        services furnished in a hospital emergency department;
            (8) makes preauthorization determinations--
                    (A) in the case of services to be furnished in a 
                hospital emergency department that are not services 
                described in section 201(c)(2), within 30 minutes of a 
                request for such determination, and
                    (B) in the case of other services, within 24 hours 
                after the time of a request for determination;
            (9) includes in any notice of such determination an 
        explanation of the basis of the determination and the right to 
        an immediate appeal;
            (10) treats a favorable preauthorization review 
        determination as a final determination for purposes of making 
        payment for a claim submitted for the item or service involved 
        unless such determination was based on fraudulent information 
        supplied by the person requesting the determination;
            (11) provides timely access to review personnel and, if 
        such personnel are not available, waives any preauthorization 
        that would otherwise be required; and
            (12) provides notice of an initial determination on payment 
        of a claim within 30 days after the date the claim is submitted 
        for such item or service, and includes in such notice an 
        explanation of the reasons for such determination and of the 
        right to an immediate appeal.
For purposes of paragraph (10), failure of a plan to make a 
determination described in paragraph (8)(A) within the period of time 
specified in such paragraph shall be treated as a favorable 
determination for the items and services for which the determination 
was requested.
    (c) Appeals Process.--A health plan meets the requirements of this 
subsection if the plan establishes and maintains an accessible appeals 
process that--
            (1) reviews an adverse preauthorization determination--
                    (A) for services described in subsection (b)(8)(A) 
                and urgent care services, within 1 hour after the time 
                of a request for such review, and
                    (B) for other services, within 24 hours after the 
                time of a request for such review;
            (2) reviews an initial determination on payment of claims 
        described in subsection (b)(12) within 30 days after the date 
        of a request for such review;
            (3) provides for review of determinations described in 
        paragraphs (1) and (2) by an appropriate clinical peer 
        professional who is in the same or similar specialty as would 
        typically provide the item or service involved (or another 
        licensed, certified, or otherwise credentialed health 
        professional acceptable to the plan and the person requesting 
        such review); and
            (4) provides for review of--
                    (A) the determinations described in paragraphs (1), 
                (2), and (3), and
                    (B) enrollee complaints about inadequate access to 
                any category, class, or type of health professional or 
                provider in the network of the plan and other matters 
                specified by this Act,
        by a person that is not involved in the operation of the plan 
        or in making the determination or policy being appealed.
The procedures specified in this subsection shall not be construed as 
preempting or superseding any other reviews or appeals a plan is 
required by law to make available.

SEC. 206. DUE PROCESS FOR HEALTH PROFESSIONALS AND PROVIDERS.

    (a) In General.--The requirements of this section are that a 
network plan--
            (1) allow all health professionals and providers in its 
        service area to apply to become a participating health 
        professional or provider during at least one period in each 
        calendar year;
            (2) provide reasonable notice to such health professionals 
        and providers of the opportunity to apply and of the period 
        during which applications are accepted;
            (3) provide for review of each application by a 
        credentialing committee with appropriate representation of the 
        category, class, or type of health professional or provider;
            (4) select participating health professionals and providers 
        based on objective standards of quality developed with the 
        suggestions and advice of professional associations, health 
        professionals, and providers;
            (5) make such standards available to--
                    (A) those applying to become a participating 
                provider or health professional;
                    (B) health plan purchasers, and
                    (C) enrollees;
            (6) when economic considerations are taken into account in 
        selecting participating health professionals and providers, 
        uses objective criteria that are available to those applying to 
        become a participating provider or health professional and 
        enrollees;
            (7) adjust any economic profiling to take into account 
        patient characteristics (such as severity of illness) that may 
        result in atypical utilization of services;
            (8) make the results of such profiling available to plan 
        purchasers, enrollees, and the health professional or provider 
        involved;
            (9) notify any health professional or provider being 
        reviewed under the process referred to in paragraph (3) of any 
        information indicating that the health professional or provider 
        fails to meet the standards of the plan;
            (10) offer a health professional or provider receiving 
        notice pursuant to the requirement of paragraph (9) with an 
        opportunity to--
                    (A) review the information referred to in such 
                paragraph, and
                    (B) submit supplemental or corrected information;
            (11) not include in its contracts with participating health 
        professionals and providers a provision permitting the plan to 
        terminate the contract ``without cause'';
            (12) provide a due process appeal that conforms to the 
        process specified in section 412 of the Health Care Quality 
        Improvement Act of 1986 (42 U.S.C. 11112) for all 
        determinations that are adverse to a health professional or 
        provider; and
            (13) unless a health professional or provider poses an 
        imminent harm to enrollees or an adverse action by a 
        governmental agency effectively impairs the ability to provide 
        health care items and services, provide--
                    (A) reasonable notice of any determination to 
                terminate a health professional or provider ``for 
                cause'' (including an explanation of the reasons for 
                the determination),
                    (B) an opportunity to review and discuss all of the 
                information on which the determination is based, and
                    (C) an opportunity to enter into a corrective 
                action plan,
        before the determination becomes subject to appeal under the 
        process referred to in paragraph (12).
    (b) Rule of Construction.--The requirements of subsection (a) shall 
not be construed as preempting or superseding any other reviews and 
appeals a plan is required by law to make available.

SEC. 207. INFORMATION REPORTING AND DISCLOSURE BY NETWORK PLANS.

    (a) In General.--The requirement of this section is that a network 
plan provide enrollees and prospective enrollees with truthful, 
accurate, and easily understandable marketing materials and information 
about--
            (1) coverage provisions, benefits, and any exclusions--
                    (A) by category of service,
                    (B) by category, class, or type of health 
                professional or provider, and
                    (C) if applicable, by specific service, including 
                experimental treatments;
            (2) the specific amount of the premium charged by the plan 
        that is set aside for administration and marketing of the plan;
            (3) the specific amount of such premium that is expended 
        directly for patient care;
            (4) the number, mix, and distribution of participating 
        health professionals and providers;
            (5) the ratio of enrollees to participating health 
        professionals and providers by category, class, and type of 
        health professional and provider,
            (6) the expenditures and utilization per enrollee by 
        category, class, and type of health professional and provider;
            (7) the financial obligations of the enrollee and the plan, 
        including premiums, copayments, deductibles, and established 
        aggregate maximums on out-of-pocket costs, for all items and 
        services, including--
                    (A) those furnished by health professionals and 
                providers that are not participating health 
                professionals and providers, and
                    (B) those furnished to an enrollee who is outside 
                the service area of the plan;
            (8) utilization review requirements of the plan (including 
        preauthorization review, concurrent review, post-service 
        review, post-payment review, and any other procedures that may 
        lead to denial of coverage or payment for a service);
            (9) financial arrangements and incentives that may--
                    (A) limit the items and services furnished to an 
                enrollee,
                    (B) restrict referral or treatment options, or
                    (C) negatively affect the fiduciary responsibility 
                of a health professional or provider to an enrollee;
            (10) other incentives for health professionals and 
        providers to control costs;
            (11) the loss ratio of the plan;
            (12) enrollee satisfaction statistics (that include data 
        for enrollees receiving services from health professionals and 
        providers that are not participating health professionals and 
        providers), including--
                    (A) the percentage of enrollees reenrolling with 
                the plan, and
                    (B) the percentage of enrollees disenrolling from 
                the plan;
            (13) quality indicators for the plan and participating 
        health professionals and providers, including--
                    (A) population-based statistics such as 
                immunization rates, and
                    (B) performance measures, such as--
                            (i) survival after surgery (adjusted for 
                        case mix),
                            (ii) hospital readmissions, and
                            (iii) appropriate referrals and prevention 
                        of secondary complications following treatment;
            (14) grievance procedures and appeals rights under the 
        plan, and summary information about the number and disposition 
        of grievances and appeals in the most recent period for which 
        complete and accurate information is available; and
            (15) the percentage of utilization review determinations 
        made by the plan that disagree with the judgment of the 
        treating health professional or provider and the percentage of 
        such determinations that are reversed on appeal.
    (b) Uniform Format.--The information required to be provided 
pursuant to this section shall be displayed in a uniform format 
specified by the State that includes the service area of a plan. If a 
State fails to establish such a format, such information shall be 
displayed in a uniform format specified by the Secretary.

SEC. 208. OTHER HEALTH PLAN REQUIREMENTS.

    (a) In General.--A health plan meets the requirements of this 
section if the plan meets--
            (1) the requirement of subsection (b) for preserving 
        confidentiality of records; and
            (2) the requirements established pursuant to subsection (c) 
        to ensure the continued operation of the plan.
    (b) Confidentiality.--The requirement of this subsection is that a 
health plan establish mechanisms and procedures to ensure compliance 
with applicable Federal and State laws to protect the confidentiality 
of individually identifiable information held by the plan with respect 
to an enrollee, health professional, or provider.
    (c) Financial Reserves; Solvency.--A health plan meets the 
requirements of this subsection if the plan--
            (1) meets such financial reserve or other solvency-related 
        requirements as the Secretary may establish to assure the 
        continued availability of (and appropriate payment for) covered 
        items and services for enrollees; and
            (2) establishes mechanisms specified by the Secretary to 
        protect enrollees, health professionals, and providers in the 
        event of plan failure.
Such requirements shall not unduly impede the establishment of health 
plans owned and operated by health care professionals or providers or 
by non-profit community-based organizations.

SEC. 209. QUALITY ASSURANCE PROGRAM; CASE REVIEW.

    (a) Quality Assurance Program.--
            (1) In general.--A health plan meets the requirements of 
        this section if the plan establishes a quality improvement 
        program (consistent with subsection (b)) that systematically 
        and continuously assesses and improves--
                    (A) enrollee health status, patient outcomes, 
                processes of care, and enrollee satisfaction associated 
                with health care provided by the plan; and
                    (B) the administrative and funding capacity of the 
                plan to support and emphasize preventive care, 
                utilization, access and availability, cost 
                effectiveness, acceptable treatment modalities, 
                specialists referrals, the peer review process, and the 
                efficiency of the administrative process.
            (2) Functions.--A quality improvement program established 
        pursuant to paragraph (1) shall--
                    (A) assess the performance of the plan and its 
                participating health professionals and providers and 
                report the results of such assessment to plan 
                purchasers, participating health professionals and 
                providers, and administrative personnel;
                    (B) demonstrate measurable improvements in clinical 
                outcomes and plan performance measured by identified 
                criteria, including those specified in paragraph 
                (1)(A); and
                    (C) analyze quality assessment data to determine 
                specific interactions in the delivery system (both the 
                design and funding of the plan and the clinical 
                provision of care) that have an adverse impact on the 
                quality of care.
            (3) Collaboration.--(A) Congress shall appoint a time-
        limited commission, consisting of health care consumers, 
        providers, and experts in the field, to devise and recommend to 
        the Secretary a mechanism for ongoing collaboration among 
        health professionals and providers, consumers, and experts on 
        quality assurance to provide for--
                    (i) educational intervention when services are 
                characterized by underutilization, overutilization, or 
                poor clinical quality;
                    (ii) organizational and financial consultation when 
                a health plan is characterized by poor access, 
                availability, and utilization of services, limitations 
                in the scope of acceptable treatment modalities, or 
                high administrative costs; and
                    (iii) other remedies if the interventions described 
                in subparagraphs (A) and (B) are unsuccessful.
            (B) The Secretary shall, in consultation with the 
        commission created in section (A), develop a mechanism for 
        ongoing collaboration among health professionals and providers, 
        consumers, and experts on quality assurance, for the purposes 
        delineated in Section (A) subparts (i), (ii), and (iii).
    (b) Case Review.--By January 1, 1998, a health plan meets the 
requirements of this section only if the plan has replaced individual 
case review with the analysis of practice profiles, except for cases of 
health professionals and providers identified as outliers which would 
require individual case review to explain the health professional's or 
provider's outlier status.

SEC. 210. RELATED PROVISIONS.

    (a) Incentives To Serve Underserved Areas.--The Secretary shall 
study and report to the Congress on the feasibility and desirability of 
voluntary participation by health plans in a system that--
            (1) uses a risk adjustment mechanism to arrive at 
        appropriately enhanced premium payments to health plans serving 
        high risk or underserved populations, and
            (2) requires part of such premiums to be passed through to 
        health professionals and providers serving such populations in 
        the form of bonus payments or higher reimbursement rates.

                         TITLE III--ENFORCEMENT

SEC. 301. HEALTH PLAN STANDARDS.

    The Secretary shall promulgate such regulations as are necessary 
and appropriate to provide for the enforcement of the requirements of 
this Act. The remedies specified in subsection (i) of section 1876 of 
the Social Security Act shall apply to health plans under this Act in 
the same manner as they apply to eligible organizations under title 
XVIII of such Act.

SEC. 302. HEALTH PLAN LIABILITY.

    (a) Health Plan Liability.--No health plan may engage in any 
activity that has the effect of inappropriately limiting or denying 
care to any individual enrolled in such plan through any utilization 
review or cost containment technique. Any such individual who alleges 
an injury caused by the application of a clinically or medically 
inappropriate decision resulting from defects in the design or 
application of any utilization review or cost containment technique by 
a health plan may commence a civil action against the health plan in 
the appropriate State court or district court of the United States.
    (b) Indemnity Restriction.--No health plan may require any health 
professional or provider to indemnify the plan for any recovery by an 
individual in an action brought under subsection (a).
    (c) Relief.--In any action commenced under subsection (a), a court 
that finds for the individual commencing the action may award 
appropriate relief to such individual.
    (d) Preemption.--Notwithstanding any other provision of law, no 
State may limit the liability of a health plan for any claim that is 
brought under subsection (a).
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