II 

113TH CONGRESS 

1ST SESSION S. 1164 

To amend the Patient Protection and Affordable Care Act to clarify provisions 

with respect to church plans. 

IN THE SENATE OF THE UNITED STATES 

JUNE 13, 2013 

Mr. PRYOR (for himself and Mr. COONS) introduced the following bill; which 

was read twice and referred to the Committee on Finance 

A BILL 

To amend the Patient Protection and Affordable Care Act 

to clarify provisions with respect to church plans. 

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 ‘‘Church Health Plan 

5 Act of 2013’’. 

6 SEC. 2. CHURCH PLANS AS QUALIFIED HEALTH PLANS. 

7 (a) IN GENERAL.—Section 1301(a) of the Patient 

8 Protection and Affordable Care Act (42 U.S.C. 18021(a)) 

9 is amended— 


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1 (1) by redesignating paragraphs (3) and (4) as 

2 paragraphs (4) and (5), respectively; and 

3 (2) by inserting after paragraph (2), the fol4 lowing: 

5 ‘‘(3) INCLUSION OF QUALIFIED CHURCH

6 PLANS.— 

7 ‘‘(A) IN GENERAL.—Any reference in this 

8 title to a qualified health plan shall be deemed 

9 to include a qualified church plan, unless spe10 cifically provided for otherwise. 

11 ‘‘(B) REQUIREMENTS OF QUALIFIED

12 CHURCH PLANS.—A qualified church plan is a 

13 church plan, as defined in section 414(e) of the 

14 Internal Revenue Code of 1986, that— 

15 ‘‘(i) is a welfare plan, as defined in 

16 section 2(c) of Public Law 106–244, and 

17 provides health care coverage for the em18 ployees of ten or more eligible common law 

19 employers, and if a majority of employees 

20 covered by the plan are employees of 

21 churches or qualified church-controlled or22 ganizations within the meaning of sections 

23 3121(w)(3) (A) and (B) of the Internal 

24 Revenue Code of 1986, respectively; 


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1 ‘‘(ii) provides an essential health bene2 fits package, as defined in section 1302(a); 

3 ‘‘(iii) complies with the requirements 

4 under sections 2703, 2706, 2708, 2709, 

5 2711, 2712, 2713, 2714, 2715, 2719, and 

6 2719A of the Public Health Service Act; 

7 ‘‘(iv) prohibits exclusions based on 

8 preexisting conditions or other health sta9 tus, and prohibits discrimination against 

10 individual participants and beneficiaries 

11 based on health status for the purposes of 

12 enrollment, within the meaning of sections 

13 2704 and 2705 of the Public Health Serv14 ice Act, except as provided under subpara15 graph (C)(ii); and 

16 ‘‘(v) limits, on average, the ratio of in17 curred losses plus loss adjustment expenses 

18 to earned premiums, within the meaning of 

19 section 2718 of the Public Health Service 

20 Act, as calculated across the entire church 

21 plan, except that, for purposes of this 

22 paragraph, earned premiums include pay23 ments by, or on behalf of, employees of a 

24 church, as defined in 414(e)(3)(B) of the 

25 Internal Revenue Code of 1986. 


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1 ‘‘(C) EXCLUSION OF QUALIFIED CHURCH

2 PLANS FROM AMERICAN HEALTH BENEFIT EX3 CHANGES.— 

4 ‘‘(i) IN GENERAL.—A qualified church 

5 plan may not participate in an American 

6 Health Benefit Exchange established by a 

7 State under section 1311(b) or by the Sec8 retary of Health and Human Services (re9 ferred to in this paragraph as the ‘Sec10 retary’) under 1321(c). The Secretary shall 

11 not assess a charge or make a payment to 

12 a qualified church plan to reflect actuarial 

13 risk pursuant to section 1343, and a quali14 fied church plan shall be exempt from any 

15 other subsidies, payments, or requirements 

16 under this Act that apply to qualified 

17 health plans offered on American Health 

18 Benefit Exchanges, except as provided by 

19 this paragraph. 

20 ‘‘(ii) PREMIUMS.—A qualified church 

21 plan may differentiate premiums using 

22 methods and criteria consistent with those 

23 that the Secretary uses to assess charges 

24 and payments to other qualified health 

25 plans based on the actuarial risks of enrollVerDate Mar 15 2010 01:44 Jun 18, 2013 Jkt 029200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S1164.IS S1164

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1 ees of such plans pursuant to section 1343 

2 and those described in section 422.308 of 

3 title 42, Code of Federal Regulations. A 

4 qualified church plan may develop addi5 tional methods and criteria to define and 

6 account for the actuarial risk associated 

7 with the prohibition against qualified 

8 church plans enrolling a larger number 

9 and more diverse pool of enrollees as long 

10 as such additional methods and criteria are 

11 not inconsistent with the risk adjusters de12 scribed in section 1343 and those described 

13 in section 422.308 of title 42, Code of 

14 Federal Regulations. 

15 ‘‘(D) DEEMED STATUS OF QUALIFIED

16 CHURCH PLANS.—A qualified church plan shall 

17 be deemed to be— 

18 ‘‘(i) minimum essential coverage 

19 under an eligible employer-sponsored plan, 

20 as defined under section 5000A(f)(2) of 

21 the Internal Revenue Code of 1986; and 

22 ‘‘(ii) for the purposes of subparagraph 

23 (F), equivalent to a health plan offered 

24 through an American Health Benefit ExVerDate Mar 15 2010 01:44 Jun 18, 2013 Jkt 029200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S1164.IS S1164

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1 change, within the meaning of section 

2 1311(b). 

3 ‘‘(E) EMPLOYERS PARTICIPATING IN

4 QUALIFIED CHURCH PLANS.— 

5 ‘‘(i) ELIGIBLE SMALL EMPLOYERS.— 

6 An employer participating in a qualified 

7 church plan shall be deemed an eligible 

8 small employer under section 45R(d) of the 

9 Internal Revenue Code of 1986, if— 

10 ‘‘(I) the employer has not more 

11 than 25 full-time equivalent employ12 ees, as defined under section 

13 45R(d)(2) of the Internal Revenue 

14 Code of 1986, for the taxable year; 

15 and 

16 ‘‘(II) the average annual wages 

17 of such full-time equivalent employees 

18 do exceed an amount equal to twice 

19 the dollar amount in effect under sec20 tion 45R(d)(3)(B) of the Internal 

21 Revenue Code of 1986 for the taxable 

22 year, and if no employee of the em23 ployer who is enrolled in the qualified 

24 church plan receives premium tax 


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1 credits or reductions in cost-sharing 

2 under subparagraph (F). 

3 ‘‘(ii) NO EXCLUSION FROM WAGES.— 

4 Any employer participating in a qualified 

5 church plan shall not exclude from wages 

6 and other compensation, for any individual 

7 receiving premium tax credits under sec8 tion 1401, any employer contribution for 

9 minimum essential coverage under a quali10 fied church plan under section 106 of the 

11 Internal Revenue Code of 1986. 

12 ‘‘(iii) EMPLOYERS PARTICIPATING IN

13 QUALIFIED CHURCH PLANS.—Any em14 ployer participating in a qualified church 

15 plan shall be deemed to be a ‘religious em16 ployer’ as defined in section 147.131 of 

17 title 45, Code of Federal Regulations. 

18 ‘‘(F) PREMIUM TAX CREDITS, REDUCTIONS

19 IN COST-SHARING, AND QUALIFIED CHURCH

20 PLANS.—An individual receiving minimum es21 sential coverage under a qualified church 

22 plan— 

23 ‘‘(i) shall be deemed to satisfy the in24 dividual responsibility requirements under 


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1 section 5000A of the Internal Revenue 

2 Code of 1986; 

3 ‘‘(ii) shall be deemed to qualify as an 

4 applicable taxpayer eligible to receive pre5 mium tax credits under section 1401, if 

6 the individual’s household income for the 

7 taxable year equals or exceeds 100 percent 

8 but does not exceed 400 percent of an 

9 amount equal to the poverty line for a fam10 ily of the size involved; and 

11 ‘‘(iii) shall be deemed to qualify as an 

12 eligible insured eligible to receive reduc13 tions in cost-sharing under section 

14 1402(b), if the individual’s household in15 come exceeds 100 percent but does not ex16 ceed 400 percent of the poverty line for a 

17 family of the size involved. 

18 ‘‘(G) REGULATIONS.—The Secretary and 

19 the Secretary of the Treasury shall promulgate 

20 regulations— 

21 ‘‘(i) under subparagraph (E) to en22 sure that an eligible small employer offer23 ing a qualified church plan receives the 

24 same tax credit as any other eligible small 


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1 employer under section 45R of the Internal 

2 Revenue Code of 1986; 

3 ‘‘(ii) under subparagraph (F)(ii) to 

4 ensure that an applicable taxpayer receiv5 ing minimum essential coverage under a 

6 qualified church plan receives the same 

7 premium tax credit as any other applicable 

8 taxpayer under section 1401; 

9 ‘‘(iii) under subparagraph (F)(iii) to 

10 ensure that an eligible insured receiving 

11 minimum essential coverage under a quali12 fied church plan receives the same reduc13 tion in cost-sharing as any other eligible 

14 insured under section 1402; and 

15 ‘‘(iv) providing church plans sufficient 

16 opportunity to make appropriate transi17 tions in order to meet the definition of 

18 qualified church plan under subparagraph 

19 (B).’’. 

20 (b) EFFECTIVE DATE.—The amendments made by 

21 this Act shall take effect as if enacted as part of the Pa22 tient Protection and Affordable Care Act (Public Law 

23 111–148). 

Æ 


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