II 

111TH CONGRESS 

1ST SESSION S. 1278 

To establish the Consumers Choice Health Plan, a public health insurance 

plan that provides an affordable and accountable health insurance option 

for consumers. 

IN THE SENATE OF THE UNITED STATES 

JUNE 17, 2009 

Mr. ROCKEFELLER (for himself and Mr. BROWN) introduced the following bill; 

which was read twice and referred to the Committee on Finance 

A BILL 

To establish the Consumers Choice Health Plan, a public 

health insurance plan that provides an affordable and 

accountable health insurance option for consumers. 

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 ‘‘Consumers Health 

5 Care Act of 2009’’. 

6 SEC. 2. FINDINGS. 

7 Congress makes the following findings: 

8 (1) Americans need health care coverage that is 

9 always affordable. 


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1 (2) Americans need health care coverage that is 

2 always adequate. 

3 (3) Americans need health care coverage that is 

4 always accountable. 

5 (4) A public health insurance plan option that 

6 can compete with private insurance plans is the only 

7 way to guarantee that all consumers have affordable, 

8 adequate, and accountable options available in the 

9 insurance marketplace. 

10 SEC. 3. OFFICE OF HEALTH PLAN MANAGEMENT. 

11 (a) ESTABLISHMENT.—Not later than July 1, 2010, 

12 there shall be established within the Department of Health 

13 and Human Services an Office of Health Plan Manage14 ment (referred to in this Act as the ‘‘Office’’). The Office 

15 shall be headed by a Director (referred to in this Act as 

16 the ‘‘Director’’) who shall be appointed by the President, 

17 by and with the advice and consent of the Senate. 

18 (b) COMPENSATION.—The Director shall be paid at 

19 the annual rate of pay for a position at level II of the 

20 Executive Schedule under section 5313 of title 5, United 

21 States Code. 

22 (c) LIMITATION.—Neither the Director nor the Office 

23 shall participate in the administration of the National 

24 Health Insurance Exchange (as defined in section 7) or 


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1 the promulgation or administration of any regulation re2 garding the health insurance industry. 

3 (d) PERSONNEL AND OPERATIONS AUTHORITY.— 

4 The Director shall have the same general authorities with 

5 respect to personnel and operations of the Office as the 

6 heads of other agencies and departments of the Federal 

7 Government have with respect to such agencies and de8 partments. 

9 SEC. 4. CONSUMER CHOICE HEALTH PLAN. 

10 (a) IN GENERAL.—The Office shall establish and ad11 minister the Consumer Choice Health Plan (referred to 

12 in this Act as the ‘‘Plan’’) to provide for health insurance 

13 coverage that is made available to all eligible individuals 

14 (as described in subsection (d)(1)) in the United States 

15 and its territories. 

16 (b) REGULATORY COMPLIANCE.—The Plan shall 

17 comply with— 

18 (1) all regulations and requirements that are 

19 applicable with respect to other health insurance 

20 plans that are offered through the National Health 

21 Insurance Exchange; and 

22 (2) any additional regulations and require23 ments, as determined by the Director. 

24 (c) BENEFITS.— 


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1 (1) IN GENERAL.—The Plan shall offer health 

2 insurance coverage at different benefit levels, pro3 vided that such benefits are commensurate with the 

4 required benefit levels to be provided by a health in5 surance plan under the National Health Insurance 

6 Exchange. 

7 (2) MINIMUM BENEFITS FOR CHILDREN.— 

8 (A) IN GENERAL.—The minimum benefit 

9 level available under the Plan for children shall 

10 include at least the services described in the 

11 most recently published version of the ‘‘Mater12 nal and Child Health Plan Benefit Model’’ de13 veloped by the National Business Group on 

14 Health. 

15 (B) AMENDMENT OF BENEFIT LEVEL.— 

16 The Secretary of Health and Human Services, 

17 acting through the Director of the Agency for 

18 Healthcare Research and Quality, may amend 

19 the benefits described in subparagraph (A) 

20 based on the most recent peer-reviewed and evi21 dence-based data. 

22 (d) ELIGIBILITY AND ENROLLMENT.— 

23 (1) ELIGIBILITY.—An individual who is eligible 

24 to purchase coverage from a health insurance plan 


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1 through the National Health Insurance Exchange 

2 shall be eligible to enroll in the Plan. 

3 (2) ENROLLMENT PROCESS.—An individual 

4 may enroll in the Plan only in such manner and 

5 form as may be prescribed by applicable regulations, 

6 and only during an enrollment period as prescribed 

7 by the Director. 

8 (3) EMPLOYER ENROLLMENT.—An employer 

9 shall be eligible to purchase health insurance cov10 erage for their employees and the employees’ de11 pendents to the extent provided for all health bene12 fits plans under the National Health Insurance Ex13 change. 

14 (4) SATISFACTION OF INDIVIDUAL MANDATE

15 REQUIREMENT.—An individual’s enrollment with the 

16 Plan shall be treated as satisfying any requirement 

17 under Federal law for such individual to dem18 onstrate enrollment in health insurance or benefits 

19 coverage. 

20 (e) PROVIDERS.— 

21 (1) NETWORK REQUIREMENT.— 

22 (A) MEDICARE.—A participating provider 

23 who is voluntarily providing health care services 

24 under the Medicare program established under 

25 title XVIII of the Social Security Act (42 


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1 U.S.C. 1395 et seq.) shall be required to pro2 vide services to any individual enrolled in the 

3 Plan. 

4 (B) MEDICAID AND CHIP.—A provider of 

5 health care services under the Medicaid pro6 gram established under title XIX of the Social 

7 Security Act (42 U.S.C. 1396 et seq.), or the 

8 CHIP program established under title XXI of 

9 such Act (42 U.S.C. 1397aa et seq.), shall be 

10 required to provide services to any individual 

11 enrolled in the Plan. 

12 (2) EXCEPTION.—Paragraph (1) shall not be 

13 construed as requiring a provider to accept new pa14 tients due to bona fide capacity limitations of the 

15 provider. 

16 (3) OPT-OUT PROVISION.— 

17 (A) MEDICARE.—A participating provider 

18 as described under paragraph (1)(A) shall be 

19 required to provide services to any individual 

20 enrolled in the Plan for the 3-year period fol21 lowing the establishment of the Plan. Upon the 

22 expiration of the 3-year period, a participating 

23 provider in the Plan may elect to become a non24 participating provider without affecting their 


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1 status as a participating provider under the 

2 Medicare program. 

3 (B) MEDICAID AND CHIP.—A provider as 

4 described under paragraph (1)(B) shall be re5 quired to provide services to any individual en6 rolled in the Plan for the 3-year period fol7 lowing the establishment of the Plan. Upon the 

8 expiration of the 3-year period, a provider in 

9 the Plan may elect to cease provision of services 

10 under the Plan without affecting their status as 

11 a provider under the Medicaid program or the 

12 CHIP program. 

13 (4) PAYMENT RATES.— 

14 (A) INITIAL PAYMENT RATES.— 

15 (i) IN GENERAL.—During the 2-year 

16 period following the establishment of the 

17 Plan, providers shall be reimbursed at such 

18 payment rates as are applicable under the 

19 Medicare program. 

20 (ii) ADJUSTMENT.—The Director may 

21 reimburse providers at rates lower or high22 er than applicable under the Medicare pro23 gram if the Director determines that the 

24 adjusted rates are appropriate and ensure 

25 that enrollees in the Plan are provided 


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1 with adequate access to health care serv2 ices. 

3 (B) SUBSEQUENT PAYMENT RATES.—Sub4 ject to subparagraph (C), upon the expiration 

5 of the 2-year period following the establishment 

6 of the Plan, the Director shall develop payment 

7 rates for reimbursement of providers in order to 

8 maintain an adequate provider network nec9 essary to assure that enrollees in the Plan have 

10 adequate access to health care. In determining 

11 such payment rates, the Director shall con12 sider— 

13 (i) competitive provider payment rates 

14 in both the public and private sectors; 

15 (ii) best practices among providers; 

16 (iii) integrated models of care delivery 

17 (including medical home and chronic care 

18 coordination models); 

19 (iv) geographic variation in health 

20 care costs; 

21 (v) evidence-based practices; 

22 (vi) quality improvement; 

23 (vii) use of health information tech24 nology; and 


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1 (viii) any additional measures, as de2 termined by the Director. 

3 (C) PAYMENT RATE CONSULTATION.—The 

4 Director shall determine payment rates under 

5 subparagraph (B) in consultation with pro6 viders participating under the Plan, the Direc7 tor of the Office of Personnel Management, the 

8 Medicare Payment Advisory Commission, and 

9 the Medicaid and CHIP Payment and Access 

10 Commission. 

11 (5) ADOPTION OF MEDICARE REFORMS.—The 

12 Plan may adopt Medicare system delivery reforms 

13 that provide patients with a coordinated system of 

14 care and make changes to the provider payment 

15 structure. 

16 (f) SUBSIDIES.—The Plan shall be eligible to accept 

17 subsidies, including subsidies for the enrollment of individ18 uals under the Plan, in the same manner and to the same 

19 extent as other health insurance plans offered through the 

20 National Health Insurance Exchange. 

21 (g) FINANCING.— 

22 (1) TRANSITIONAL FUNDING.— 

23 (A) IN GENERAL.—In order to provide for 

24 adequate funding of the Plan in advance of re25 ceipt of payments as described in paragraph 


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1 (2), beginning July 1, 2010, there are trans2 ferred to the Plan from the general fund of the 

3 Treasury such amounts as may be necessary for 

4 operation of the Plan until the end of the 3- 

5 year period following the establishment of the 

6 Plan. 

7 (B) RETURN OF FUNDS.—Upon the expi8 ration of the 3-year period following the estab9 lishment of the Plan, the Director shall enter 

10 into a repayment schedule with the Secretary of 

11 the Treasury to provide for repayment of funds 

12 provided under subparagraph (A). Any expendi13 tures made by the Plan pursuant to a repay14 ment schedule established under this subpara15 graph shall not constitute administrative ex16 penses as described in paragraph (2)(B). 

17 (2) SELF-FINANCING.— 

18 (A) IN GENERAL.—The Plan shall be fi19 nancially self-sustaining insofar as funds used 

20 for operation of the Plan (including benefits, 

21 administration, and marketing) shall be derived 

22 from— 

23 (i) insurance premium payments and 

24 subsidies for individuals enrolled in the 

25 Plan; and 


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1 (ii) payments made to the Plan by 

2 employers that do not offer health insur3 ance coverage to their employees. 

4 (B) LIMITATION ON ADMINISTRATIVE EX5 PENSES.—Not more than 5 percent of the 

6 amounts provided under subparagraph (A) may 

7 be used for the annual administrative costs of 

8 the Plan. 

9 (3) CONTINGENCY RESERVE.— 

10 (A) IN GENERAL.—The Director shall es11 tablish and fund a contingency reserve for the 

12 Plan in a form similar to the contingency re13 serve provided for health benefits plans under 

14 the Federal Employees Health Benefits Pro15 gram under chapter 89 of title 5, United States 

16 Code. 

17 (B) REVENUE.—Any revenue generated 

18 through the contingency reserve established in 

19 subparagraph (A) shall be transferred to the 

20 Plan for the purpose of reducing enrollee pre21 miums, reducing enrollee cost-sharing, increas22 ing enrollee benefits, or any combination there23 of. 

24 (4) GAO FINANCIAL AUDIT AND REPORT.—Be25 ginning not later than October 1, 2011, the CompVerDate Nov 24 2008 02:23 Jun 18, 2009 Jkt 079200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S1278.IS S1278

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1 troller General shall conduct an annual audit of the 

2 financial statements and records of the Plan, in ac3 cordance with generally accepted government audit4 ing standards, and submit an annual report on such 

5 audit to the Congress. 

6 (5) SUPERMAJORITY REQUIREMENT FOR SUP7 PLEMENTAL FUNDING.—Upon certification by the 

8 Comptroller General that the financial audit de9 scribed in paragraph (4) indicates that the Plan is 

10 insolvent, supplemental funding may be appropriated 

11 for the Plan if such measure receives not less than 

12 a three-fifths vote of approval of the total number 

13 of Members of the House of Representatives and the 

14 Senate. 

15 (h) TRANSPARENCY.— 

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

17 year of operation of the Plan through the National 

18 Health Insurance Exchange, the Director shall pro19 vide standards and undertake activities for pro20 moting transparency in costs, benefits, and other 

21 factors for health insurance coverage provided under 

22 the Plan. 

23 (2) STANDARD DEFINITIONS OF INSURANCE

24 AND MEDICAL TERMS.— 


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1 (A) IN GENERAL.—The Director shall pro2 vide for the development of standards for the 

3 definitions of terms used in health insurance 

4 coverage under the Plan, including insurance5 related terms (including the insurance-related 

6 terms described in subparagraph (B)) and med7 ical terms (including the medical terms de8 scribed in subparagraph (C)). 

9 (B) INSURANCE-RELATED TERMS.—The 

10 insurance-related terms described in this sub11 paragraph are premium, deductible, co-insur12 ance, co-payment, out-of-pocket limit, preferred 

13 provider, non-preferred provider, out-of-network 

14 co-payments, UCR (usual, customary and rea15 sonable) fees, excluded services, grievance and 

16 appeals, and such other terms as the Director 

17 determines are important to define so that con18 sumers may compare health insurance coverage 

19 and understand the terms of their coverage. 

20 (C) MEDICAL TERMS.—The medical terms 

21 described in this subparagraph are hospitaliza22 tion, hospital outpatient care, emergency room 

23 care, physician services, prescription drug cov24 erage, durable medical equipment, home health 

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1 ices, hospice services, emergency medical trans2 portation, and such other terms as the Director 

3 determines are important to define so that con4 sumers may compare the medical benefits of5 fered by health insurance plans and understand 

6 the extent of those medical benefits (or excep7 tions to those benefits). 

8 (3) DISCLOSURE.— 

9 (A) IN GENERAL.—In carrying out this 

10 subsection, the Director shall disclose to Plan 

11 enrollees, potential enrollees, in-network health 

12 care providers, and others (through a publically 

13 available Internet website and other appropriate 

14 means) relevant information regarding each pol15 icy of health insurance coverage marketed or in 

16 force (in such standardized manner as deter17 mined by the Director), including— 

18 (i) full policy contract language; and 

19 (ii) a summary of the information de20 scribed in paragraph (4). 

21 (B) PERSONALIZED STATEMENT.—The Di22 rector shall disclose to enrollees (in such stand23 ardized manner as determined by the Director) 

24 an annual personalized statement that summa25 rizes use of health care services and payment of 


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1 claims with respect to an enrollee (and covered 

2 dependents) under health insurance coverage 

3 provided through the Plan in the preceding 

4 year. 

5 (4) REQUIRED INFORMATION.—The informa6 tion described in this paragraph includes, but is not 

7 limited to, the following: 

8 (A) Data on the price of each new policy 

9 of health insurance coverage and renewal rating 

10 practices. 

11 (B) Claims payment policies and practices, 

12 including how many and how quickly claims 

13 were paid. 

14 (C) Provider fee schedules and usual, cus15 tomary, and reasonable fees (for both in-net16 work and out-of-network providers). 

17 (D) Provider participation and provider di18 rectories. 

19 (E) Loss ratios, including detailed infor20 mation about amount and type of non-claims 

21 expenses. 

22 (F) Covered benefits, cost-sharing, and 

23 amount of payment provided toward each type 

24 of service identified as a covered benefit, includ25 ing preventive care services recommended by 


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1 the United States Preventive Services Task 

2 Force. 

3 (G) Civil or criminal actions successfully 

4 concluded against the Plan by any govern5 mental entity. 

6 (H) Benefit exclusions and limits. 

7 (5) DEVELOPMENT OF PATIENT CLAIMS SCE8 NARIOS.— 

9 (A) IN GENERAL.—In order to improve the 

10 ability of individuals and employers to compare 

11 the coverage and relative value provided under 

12 the Plan, the Director shall develop and make 

13 publically available a series of patient claims 

14 scenarios under which benefits (including out15 of-pocket costs) under the Plan are simulated 

16 for certain common or expensive conditions or 

17 courses of treatment (including maternity care, 

18 breast cancer, heart disease, diabetes manage19 ment, and well-child visits). 

20 (B) CONSULTATION.—The Director shall 

21 develop the patient claims scenarios described 

22 in subparagraph (A)— 

23 (i) in consultation with the Secretary 

24 of Health and Human Services, the Na25 tional Institutes of Health, the Centers for 


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1 Disease Control and Prevention, the Agen2 cy for Healthcare Research and Quality, 

3 health professional societies, patient advo4 cates, and other entities as deemed nec5 essary by the Director; and 

6 (ii) based upon recognized clinical 

7 practice guidelines. 

8 (6) MANNER OF DISCLOSURE.—The Director 

9 shall disclose the information under this sub10 section— 

11 (A) with all marketing materials; 

12 (B) on the website for the Plan; and 

13 (C) at other times upon request. 

14 SEC. 5. ESTABLISHMENT OF AMERICA’S HEALTH INSUR15 ANCE TRUST. 

16 (a) ESTABLISHMENT.—As of the date of enactment 

17 of this Act, there is authorized to be established a non18 profit corporation that shall be known as the ‘‘America’s 

19 Health Insurance Trust’’ (referred to in this Act as the 

20 ‘‘Trust’’), which is neither an agency nor establishment 

21 of the United States Government. 

22 (b) LOCATION; SERVICE OF PROCESS.—The Trust 

23 shall maintain its principal office within the District of 

24 Columbia and have a designated agent in the District of 

25 Columbia to receive service of process for the Trust. NoVerDate Nov 24 2008 02:23 Jun 18, 2009 Jkt 079200 PO 00000 Frm 00017 Fmt 6652 Sfmt 6201 E:\BILLS\S1278.IS S1278

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1 tice to or service on the agent shall be deemed as notice 

2 to or service on the corporation. 

3 (c) APPLICATION OF PROVISIONS.—The Trust shall 

4 be subject to the provisions of this section and, to the ex5 tent consistent with this section, to the District of Colum6 bia Nonprofit Corporation Act. 

7 (d) TAX EXEMPT STATUS.—The Trust shall be treat8 ed as a nonprofit organization described under section 

9 170(c)(2)(B) and section 501(c)(3) of the Internal Rev10 enue Code of 1986 that is exempt from taxation under 

11 section 501(a) of the Internal Revenue Code of 1986. 

12 (e) BOARD OF DIRECTORS.— 

13 (1) IN GENERAL.—The Board of Directors of 

14 the Trust (referred to in this Act as the ‘‘Board’’) 

15 shall consist of 19 voting members appointed by the 

16 Comptroller General. 

17 (2) TERMS.— 

18 (A) IN GENERAL.—Subject to subpara19 graph (C), each member of the Board shall 

20 serve for a term of 6 years. 

21 (B) LIMITATION.—No individual shall be 

22 appointed to the Board for more than 2 con23 secutive terms. 

24 (C) INITIAL MEMBERS.—The initial mem25 bers of the Board shall be appointed by the 


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1 Comptroller General not later than October 1, 

2 2010, and shall serve terms as follows: 

3 (i) 8 members shall be appointed for 

4 a term of 5 years. 

5 (ii) 8 members shall be appointed for 

6 a term of 3 years. 

7 (iii) 3 members shall be appointed for 

8 a term of 1 year. 

9 (D) EXPIRATION OF TERM.—Any member 

10 of the Board whose term has expired may serve 

11 until such member’s successor has taken office, 

12 or until the end of the calendar year in which 

13 such member’s term has expired, whichever is 

14 earlier. 

15 (E) VACANCIES.— 

16 (i) IN GENERAL.—Any member ap17 pointed to fill a vacancy prior to the expi18 ration of the term for which such mem19 ber’s predecessor was appointed shall be 

20 appointed for the remainder of such term. 

21 (ii) VACANCIES NOT TO AFFECT

22 POWER OF BOARD.—A vacancy on the 

23 Board shall not affect its powers, but shall 

24 be filled in the same manner as the origi25 nal appointment was made. 


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1 (3) CHAIRPERSON AND VICE-CHAIRPERSON.— 

2 (A) IN GENERAL.—The Comptroller Gen3 eral shall designate a Chairperson and Vice4 Chairperson of the Board from among the 

5 members of the Board. 

6 (B) TERM.—The members designated as 

7 Chairperson and Vice-Chairperson shall serve 

8 for a period of 3 years. 

9 (4) CONFLICTS OF INTEREST.—An individual 

10 may not serve on the Board if such individual (or an 

11 immediate family member of such individual) is em12 ployed by or has a financial interest in— 

13 (A) an organization that provides a health 

14 insurance plan; 

15 (B) a pharmaceutical manufacturer; or 

16 (C) any subsidiary entities of an organiza17 tion described in subparagraphs (A) or (B). 

18 (5) COMPOSITION OF THE BOARD.— 

19 (A) POLITICAL PARTIES.—Not more than 

20 10 members of the Board may be affiliated with 

21 the same political party. 

22 (B) DIVERSITY.—In appointing members 

23 under this paragraph, the Comptroller General 

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1 priately diverse representation with respect to 

2 race, ethnicity, age, gender, and geography. 

3 (C) CONSUMER REPRESENTATION.—10 

4 members of the Board shall be independent and 

5 non-conflicted individuals representing the in6 terests of health care consumers. Each member 

7 selected under this subparagraph shall rep8 resent 1 of the 10 Department of Health and 

9 Human Services regions in the United States. 

10 (D) REMAINING REPRESENTATION.— 

11 (i) IN GENERAL.—9 members of the 

12 Board shall be selected based on relevant 

13 experience, including expertise in— 

14 (I) community affairs; 

15 (II) Federal, State, and local 

16 government; 

17 (III) health professions and ad18 ministration; 

19 (IV) business, finance, and ac20 counting; 

21 (V) legal affairs; 

22 (VI) insurance; 

23 (VII) trade unions; 

24 (VIII) social services; and 


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1 (IX) any additional areas as de2 termined by the Comptroller General. 

3 (ii) INCOME FROM HEALTH CARE IN4 DUSTRY.—Not more than 4 of the mem5 bers selected under this subparagraph shall 

6 earn more than 10 percent of their income 

7 from the health care industry. 

8 (6) MEETINGS AND HEARINGS.—The Board 

9 shall meet and hold hearings at the call of the 

10 Chairperson or a majority of its members. Meetings 

11 of the Board on matters not related to personnel 

12 shall be open to the public and advertised through 

13 public notice at least 7 days prior to the meeting. 

14 (7) QUORUM.—A majority of the members of 

15 the Board shall constitute a quorum for purposes of 

16 conducting the duties of the Trust, but a lesser 

17 number of members may meet and hold hearings. 

18 (8) EXECUTIVE DIRECTOR AND STAFF; PER19 FORMANCE OF DUTIES.—The Board may— 

20 (A) employ and fix the compensation of an 

21 Executive Director and such other personnel as 

22 may be necessary to carry out the duties of the 

23 Trust; 

24 (B) seek such assistance and support as 

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1 ties of the Trust from appropriate departments 

2 and agencies of the Federal Government; 

3 (C) enter into contracts or other arrange4 ments and make such payments as may be nec5 essary for performance of the duties of the 

6 Trust; 

7 (D) provide travel, subsistence, and per 

8 diem compensation for individuals performing 

9 the duties of the Trust, including members of 

10 the Advisory Council (as described in subsection 

11 (f)); and 

12 (E) prescribe such rules, regulations, and 

13 bylaws as the Board determines necessary with 

14 respect to the internal organization and oper15 ation of the Trust. 

16 (9) LOBBYING COOLING-OFF PERIOD FOR MEM17 BERS OF THE BOARD.—Section 207(c) of title 18, 

18 United States Code, is amended by inserting at the 

19 end the following: 

20 ‘‘(3) MEMBERS OF THE BOARD OF DIRECTORS

21 OF THE AMERICA’S HEALTH INSURANCE TRUST.— 

22 Paragraph (1) shall apply to a member of the Board 

23 of Directors of the America’s Health Insurance 

24 Trust who was appointed to the Board as of the day 


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1 before the date of enactment of the Consumers 

2 Health Care Act of 2009.’’. 

3 (f) ADVISORY COUNCIL.— 

4 (1) ESTABLISHMENT.—The Board shall estab5 lish an advisory council that shall be comprised of 

6 the insurance commissioners of each State (includ7 ing the District of Columbia) to advise the Board on 

8 the development and impact of measures to improve 

9 the transparency and accountability of health insur10 ance plans provided through the National Health In11 surance Exchange. 

12 (2) MEETINGS.—The advisory council shall 

13 meet not less than twice a year and at the request 

14 of the Board. 

15 (g) FINANCIAL OVERSIGHT.— 

16 (1) CONTRACT FOR AUDITS.—The Trust shall 

17 provide for financial audits of the Trust on an an18 nual basis by a private entity with expertise in con19 ducting financial audits. 

20 (2) REVIEW AND REPORT ON AUDITS.—The 

21 Comptroller General shall— 

22 (A) review and evaluate the results of the 

23 audits conducted pursuant to paragraph (1); 

24 and 


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1 (B) submit a report to Congress containing 

2 the results and review of such audits, including 

3 an analysis of the adequacy and use of the 

4 funding for the Trust and its activities. 

5 (h) RULES ON GIFTS AND OUTSIDE CONTRIBU6 TIONS.— 

7 (1) GIFTS.—The Trust (including the Board 

8 and any staff acting on behalf of the Trust) shall 

9 not accept gifts, bequeaths, or donations of services 

10 or property. 

11 (2) PROHIBITION ON OUTSIDE FUNDING OR

12 CONTRIBUTIONS.—The Trust shall not— 

13 (A) establish a corporation other than as 

14 provided under this section; or 

15 (B) accept any funds or contributions 

16 other than as provided under this section. 

17 (i) AMERICA’S HEALTH INSURANCE TRUST FUND.— 

18 (1) IN GENERAL.—There is established in the 

19 Treasury a trust fund to be known as the ‘‘Amer20 ica’s Health Insurance Trust Fund’’ (referred to in 

21 this section as the ‘‘Trust Fund’’), consisting of 

22 such amounts as may be credited to the Trust Fund 

23 as provided under this subsection. 

24 (2) TRANSFER.—The Secretary of the Treasury 

25 shall transfer to the Trust Fund out of the general 


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1 fund of the Treasury amounts determined by the 

2 Secretary to be equivalent to the amounts received 

3 into such general fund that are attributable to the 

4 fees collected under sections 4375 and 4376 of the 

5 Internal Revenue Code of 1986 (relating to fees on 

6 health insurance policies and self-insured health 

7 plans). 

8 (3) FINANCING FOR FUND FROM FEES ON IN9 SURED AND SELF-INSURED HEALTH PLANS.— 

10 (A) GENERAL RULE.—Chapter 34 of the 

11 Internal Revenue Code of 1986 is amended by 

12 adding at the end the following new subchapter: 

13 ‘‘Subchapter B—Insured and Self-Insured 

14 Health Plans 

‘‘Sec. 4375. Health insurance. 

‘‘Sec. 4376. Self-insured health plans. 

‘‘Sec. 4377. Definitions and special rules. 

15 ‘‘SEC. 4375. HEALTH INSURANCE. 

16 ‘‘(a) IMPOSITION OF FEE.—In the case of any speci17 fied health insurance policy issued after October 1, 2009, 

18 there is hereby imposed a fee equal to— 

19 ‘‘(1) for policies issued during fiscal years 2010 

20 through 2013, 50 cents multiplied by the average 

21 number of lives covered under the policy; and 

22 ‘‘(2) for policies issued after September 30, 

23 2013, $1 multiplied by the average number of lives 

24 covered under the policy. 


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1 ‘‘(b) LIABILITY FOR FEE.—The fee imposed by sub2 section (a) shall be paid by the issuer of the policy. 

3 ‘‘(c) SPECIFIED HEALTH INSURANCE POLICY.—For 

4 purposes of this section: 

5 ‘‘(1) IN GENERAL.—Except as otherwise pro6 vided in this section, the term ‘specified health in7 surance policy’ means any accident or health insur8 ance policy (including a policy under a group health 

9 plan) issued with respect to individuals residing in 

10 the United States. 

11 ‘‘(2) EXEMPTION FOR CERTAIN POLICIES.—The 

12 term ‘specified health insurance policy’ does not in13 clude any insurance if substantially all of its cov14 erage is of excepted benefits described in section 

15 9832(c). 

16 ‘‘(3) TREATMENT OF PREPAID HEALTH COV17 ERAGE ARRANGEMENTS.— 

18 ‘‘(A) IN GENERAL.—In the case of any ar19 rangement described in subparagraph (B)— 

20 ‘‘(i) such arrangement shall be treated 

21 as a specified health insurance policy, and 

22 ‘‘(ii) the person referred to in such 

23 subparagraph shall be treated as the 

24 issuer. 


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1 ‘‘(B) DESCRIPTION OF ARRANGEMENTS.— 

2 An arrangement is described in this subpara3 graph if under such arrangement fixed pay4 ments or premiums are received as consider5 ation for any person’s agreement to provide or 

6 arrange for the provision of accident or health 

7 coverage to residents of the United States, re8 gardless of how such coverage is provided or ar9 ranged to be provided. 

10 ‘‘(d) ADJUSTMENTS FOR INCREASES IN HEALTH

11 CARE SPENDING.—In the case of any policy issued in any 

12 fiscal year beginning after September 30, 2014, the dollar 

13 amount in effect under subsection (a) for such policy shall 

14 be equal to the sum of such dollar amount for policies 

15 issued in the previous fiscal year (determined after the ap16 plication of this subsection), plus an amount equal to the 

17 product of— 

18 ‘‘(1) such dollar amount for policies issued in 

19 the previous fiscal year, multiplied by 

20 ‘‘(2) the percentage increase in the projected 

21 per capita amount of National Health Expenditures 

22 from the calendar year in which the previous fiscal 

23 year ends to the calendar year in which the fiscal 

24 year involved ends, as most recently published by the 


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1 Secretary of Health and Human Services before the 

2 beginning of the fiscal year. 

3 ‘‘(e) TERMINATION.—This section shall not apply to 

4 policy years ending after September 30, 2019. 

5 ‘‘SEC. 4376. SELF-INSURED HEALTH PLANS. 

6 ‘‘(a) IMPOSITION OF FEE.—In the case of any appli7 cable self-insured health plan issued after October 1, 

8 2009, there is hereby imposed a fee equal to— 

9 ‘‘(1) for plans issued during fiscal years 2010 

10 through 2013, 50 cents multiplied by the average 

11 number of lives covered under the plan; and 

12 ‘‘(2) for plans issued after September 30, 2013, 

13 $1 multiplied by the average number of lives covered 

14 under the plans. 

15 ‘‘(b) LIABILITY FOR FEE.— 

16 ‘‘(1) IN GENERAL.—The fee imposed by sub17 section (a) shall be paid by the plan sponsor. 

18 ‘‘(2) PLAN SPONSOR.—For purposes of para19 graph (1) the term ‘plan sponsor’ means— 

20 ‘‘(A) the employer in the case of a plan es21 tablished or maintained by a single employer, 

22 ‘‘(B) the employee organization in the case 

23 of a plan established or maintained by an em24 ployee organization, 

25 ‘‘(C) in the case of— 


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1 ‘‘(i) a plan established or maintained 

2 by 2 or more employers or jointly by 1 or 

3 more employers and 1 or more employee 

4 organizations, 

5 ‘‘(ii) a multiple employer welfare ar6 rangement, or 

7 ‘‘(iii) a voluntary employees’ bene8 ficiary association described in section 

9 501(c)(9), 

10 the association, committee, joint board of trust11 ees, or other similar group of representatives of 

12 the parties who establish or maintain the plan, 

13 or 

14 ‘‘(D) the cooperative or association de15 scribed in subsection (c)(2)(F) in the case of a 

16 plan established or maintained by such a coop17 erative or association. 

18 ‘‘(c) APPLICABLE SELF-INSURED HEALTH PLAN.— 

19 For purposes of this section, the term ‘applicable self-in20 sured health plan’ means any plan for providing accident 

21 or health coverage if— 

22 ‘‘(1) any portion of such coverage is provided 

23 other than through an insurance policy, and 

24 ‘‘(2) such plan is established or maintained— 


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1 ‘‘(A) by one or more employers for the 

2 benefit of their employees or former employees, 

3 ‘‘(B) by one or more employee organiza4 tions for the benefit of their members or former 

5 members, 

6 ‘‘(C) jointly by 1 or more employers and 1 

7 or more employee organizations for the benefit 

8 of employees or former employees, 

9 ‘‘(D) by a voluntary employees’ beneficiary 

10 association described in section 501(c)(9), 

11 ‘‘(E) by any organization described in sec12 tion 501(c)(6), or 

13 ‘‘(F) in the case of a plan not described in 

14 the preceding subparagraphs, by a multiple em15 ployer welfare arrangement (as defined in sec16 tion 3(40) of Employee Retirement Income Se17 curity Act of 1974), a rural electric cooperative 

18 (as defined in section 3(40)(B)(iv) of such Act), 

19 or a rural telephone cooperative association (as 

20 defined in section 3(40)(B)(v) of such Act). 

21 ‘‘(d) ADJUSTMENTS FOR INCREASES IN HEALTH

22 CARE SPENDING.—In the case of any plan issued in any 

23 fiscal year beginning after September 30, 2014, the dollar 

24 amount in effect under subsection (a) for such plan shall 

25 be equal to the sum of such dollar amount for plans issued 


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1 in the previous fiscal year (determined after the applica2 tion of this subsection), plus an amount equal to the prod3 uct of— 

4 ‘‘(1) such dollar amount for plans issued in the 

5 previous fiscal year, multiplied by 

6 ‘‘(2) the percentage increase in the projected 

7 per capita amount of National Health Expenditures 

8 from the calendar year in which the previous fiscal 

9 year ends to the calendar year in which the fiscal 

10 year involved ends, as most recently published by the 

11 Secretary of Health and Human Services before the 

12 beginning of the fiscal year. 

13 ‘‘(e) TERMINATION.—This section shall not apply to 

14 plans issued after September 30, 2019. 

15 ‘‘SEC. 4377. DEFINITIONS AND SPECIAL RULES. 

16 ‘‘(a) DEFINITIONS.—For purposes of this sub17 chapter— 

18 ‘‘(1) ACCIDENT AND HEALTH COVERAGE.—The 

19 term ‘accident and health coverage’ means any cov20 erage which, if provided by an insurance policy, 

21 would cause such policy to be a specified health in22 surance policy (as defined in section 4375(c)). 

23 ‘‘(2) INSURANCE POLICY.—The term ‘insurance 

24 policy’ means any policy or other instrument whereVerDate Nov 24 2008 02:23 Jun 18, 2009 Jkt 079200 PO 00000 Frm 00032 Fmt 6652 Sfmt 6201 E:\BILLS\S1278.IS S1278

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1 by a contract of insurance is issued, renewed, or ex2 tended. 

3 ‘‘(3) UNITED STATES.—The term ‘United 

4 States’ includes any possession of the United States. 

5 ‘‘(b) TREATMENT OF GOVERNMENTAL ENTITIES.— 

6 ‘‘(1) IN GENERAL.—For purposes of this sub7 chapter— 

8 ‘‘(A) the term ‘person’ includes any gov9 ernmental entity, and 

10 ‘‘(B) notwithstanding any other law or rule 

11 of law, governmental entities shall not be ex12 empt from the fees imposed by this subchapter 

13 except as provided in paragraph (2). 

14 ‘‘(2) TREATMENT OF EXEMPT GOVERNMENTAL

15 PROGRAMS.—In the case of an exempt governmental 

16 program, no fee shall be imposed under section 4375 

17 or section 4376 on any covered policy or plan under 

18 such program. 

19 ‘‘(3) EXEMPT GOVERNMENTAL PROGRAM DE20 FINED.—For purposes of this subchapter, the term 

21 ‘exempt governmental program’ means— 

22 ‘‘(A) any insurance program established 

23 under title XVIII of the Social Security Act, 


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1 ‘‘(B) the medical assistance program es2 tablished by title XIX or XXI of the Social Se3 curity Act, 

4 ‘‘(C) the Federal Employees Health Bene5 fits Program under chapter 89 of title 5, 

6 United States Code, 

7 ‘‘(D) the Consumer Choice Health Plan es8 tablished under the Consumers Health Care Act 

9 of 2009, 

10 ‘‘(E) any program established by Federal 

11 law for providing medical care (other than 

12 through insurance policies) to individuals (or 

13 the spouses and dependents thereof) by reason 

14 of such individuals being— 

15 ‘‘(i) members of the Armed Forces of 

16 the United States, or 

17 ‘‘(ii) veterans, and 

18 ‘‘(F) any program established by Federal 

19 law for providing medical care (other than 

20 through insurance policies) to members of In21 dian tribes (as defined in section 4(d) of the In22 dian Health Care Improvement Act). 

23 ‘‘(c) TREATMENT AS TAX.—For purposes of subtitle 

24 F, the fees imposed by this subchapter shall be treated 

25 as if they were taxes. 


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1 ‘‘(d) NO COVER OVER TO POSSESSIONS.—Notwith2 standing any other provision of law, no amount collected 

3 under this subchapter shall be covered over to any posses4 sion of the United States.’’. 

5 (B) CLERICAL AMENDMENTS.— 

6 (i) Chapter 34 of such Code is amend7 ed by striking the chapter heading and in8 serting the following: 

9 ‘‘CHAPTER 34—TAXES ON CERTAIN 

10 INSURANCE POLICIES 

‘‘SUBCHAPTER A. POLICIES ISSUED BY FOREIGN INSURERS

‘‘SUBCHAPTER B. INSURED AND SELF-INSURED HEALTH PLANS

11 ‘‘Subchapter A—Policies Issued By Foreign 

12 Insurers’’. 

13 (ii) The table of chapters for subtitle 

14 D of such Code is amended by striking the 

15 item relating to chapter 34 and inserting 

16 the following new item: 

‘‘CHAPTER 34—TAXES ON CERTAIN INSURANCE POLICIES’’. 

17 SEC. 6. DUTIES OF AMERICA’S HEALTH INSURANCE TRUST. 

18 (a) INSURANCE PLAN RANKINGS AND WEBSITE.— 

19 (1) WEB-BASED MATERIALS.—The Trust shall 

20 establish and maintain a website that provides infor21 mational materials regarding the health insurance 

22 plans provided through the National Health InsurVerDate Nov 24 2008 02:23 Jun 18, 2009 Jkt 079200 PO 00000 Frm 00035 Fmt 6652 Sfmt 6201 E:\BILLS\S1278.IS S1278

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1 ance Exchange, including appropriate links for all 

2 available State insurance commissioner websites. 

3 (2) PLAN RANKINGS.—The Trust shall develop 

4 and publish annual rankings of the health insurance 

5 plans provided through the National Health Insur6 ance Exchange, based on the assignment of a letter 

7 grade between ‘‘grade A’’ (highest) and ‘‘grade F’’ 

8 (lowest). The Trust shall provide for a comparative 

9 evaluation of each plan based upon— 

10 (A) administrative expenditures; 

11 (B) affordability of coverage; 

12 (C) adequacy of coverage; 

13 (D) timeliness and adequacy of consumer 

14 claims processing; 

15 (E) available consumer complaint systems; 

16 (F) grievance and appeals processes; 

17 (G) transparency; 

18 (H) consumer satisfaction; and 

19 (I) any additional measures as determined 

20 by the Board. 

21 (3) INFORMATION AVAILABLE ON WEBSITE BY

22 ZIP CODE.—The annual rankings of the health in23 surance plans (as described in paragraph (2)) shall 

24 be available on the website for the Trust (as de25 scribed in paragraph (1)), and the website for the 


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1 National Health Insurance Exchange, in a manner 

2 that is searchable and sortable by zip code. 

3 (4) CONSUMER FEEDBACK.— 

4 (A) CONSUMER COMPLAINTS.—The Trust 

5 shall develop written and web-based methods 

6 for individuals to provide recommendations and 

7 complaints regarding the health insurance plans 

8 provided through the National Health Insur9 ance Exchange. 

10 (B) CONSUMER SURVEYS.—The Trust 

11 shall obtain meaningful consumer input, includ12 ing consumer surveys, that measure the extent 

13 to which an individual receives the services and 

14 supports described in the individual’s health in15 surance plan and the individual’s satisfaction 

16 with such services and supports. 

17 (b) DATA SHARING.— 

18 (1) IN GENERAL.—An organization that pro19 vides a health insurance plan through the National 

20 Health Insurance Exchange shall provide the Trust 

21 with all information and data that is necessary for 

22 improving transparency, monitoring, and oversight 

23 of such plans. 

24 (2) ANNUAL DISCLOSURE.—Beginning with the 

25 first full year of operation of the National Health 


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1 Insurance Exchange, an organization that provides a 

2 health insurance plan through the National Health 

3 Insurance Exchange shall annually provide the Trust 

4 with appropriate information regarding the fol5 lowing: 

6 (A) Name of the plan. 

7 (B) Levels of available plan benefits. 

8 (C) Description of plan benefits. 

9 (D) Number of enrollees under the plan. 

10 (E) Demographic profile of enrollees under 

11 the plan. 

12 (F) Number of claims paid to enrollees. 

13 (G) Number of enrollees that terminated 

14 their coverage under the plan. 

15 (H) Total operating cost for the plan (in16 cluding administrative costs). 

17 (I) Patterns of utilization of the plan’s 

18 services. 

19 (J) Availability, accessibility, and accept20 ability of the plan’s services. 

21 (K) Such information as the Trust may re22 quire demonstrating that the organization has a 

23 fiscally sound operation. 

24 (L) Any additional information as deter25 mined by the Trust. 


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1 (3) FORM AND MANNER OF INFORMATION.—In2 formation to be provided to the Trust under para3 graphs (1) and (2) shall be provided— 

4 (A) in such form and manner as specified 

5 by the Trust; and 

6 (B) within 30 days of the date of receipt 

7 of the request for such information, or within 

8 such extended period as the Trust deems appro9 priate. 

10 (4) INFORMATION FROM THE DEPARTMENT OF

11 HEALTH AND HUMAN SERVICES.— 

12 (A) IN GENERAL.—Any information re13 garding the health insurance plans that are of14 fered through the National Health Insurance 

15 Exchange that has been provided to the Sec16 retary of Health and Human Services shall also 

17 be made available (as deemed appropriate by 

18 the Secretary) to the Trust for the purpose of 

19 improving transparency, monitoring, and over20 sight of such plans. Such information may in21 clude, but is not limited to, the following: 

22 (i) Underwriting guidelines to ensure 

23 compliance with applicable Federal health 

24 insurance requirements. 


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1 (ii) Rating practices to ensure compli2 ance with applicable Federal health insur3 ance requirements. 

4 (iii) Enrollment and disenrollment 

5 data, including information the Secretary 

6 may need to detect patterns of discrimina7 tion against individuals based on health 

8 status or other characteristics, to ensure 

9 compliance with applicable Federal health 

10 insurance requirements (including non-dis11 crimination in group coverage, guaranteed 

12 issue, and guaranteed renewability require13 ments applicable in all markets). 

14 (iv) Post-claims underwriting and re15 scission practices to ensure compliance 

16 with applicable Federal health insurance 

17 requirements relating to guaranteed renew18 ability. 

19 (v) Marketing materials and agent 

20 guidelines to ensure compliance with appli21 cable Federal health insurance require22 ments. 

23 (vi) Data on the imposition of pre-ex24 isting condition exclusion periods and 

25 claims subjected to such exclusion periods. 


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1 (vii) Information on issuance of cer2 tificates of creditable coverage. 

3 (viii) Information on cost-sharing and 

4 payments with respect to any out-of-net5 work coverage. 

6 (ix) The application to issuers of pen7 alties for violation of applicable Federal 

8 health insurance requirements (including 

9 failure to produce requested information). 

10 (x) Such other information as the 

11 Trust may determine to be necessary to 

12 verify compliance with the requirements of 

13 this Act. 

14 (B) REQUIRED DISCLOSURE.—The Sec15 retary of Health and Human Services shall pro16 vide the Trust with all consumer claims data or 

17 information that has been provided to the Sec18 retary by any health insurance plan that is of19 fered through the National Health Insurance 

20 Exchange. 

21 (C) PERIOD FOR PROVIDING INFORMA22 TION.—Information to be provided to the Trust 

23 under this paragraph shall be provided by the 

24 Secretary within 30 days of the date of receipt 

25 of the request for such information, or within 


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1 such extended period as the Secretary and the 

2 Trust mutually deem appropriate. 

3 (5) NON-DISCLOSURE OF HEALTH INSURANCE

4 DATA.—The Trust shall prevent disclosure of any 

5 data or information provided under this paragraph 

6 that the Trust determines is proprietary or qualifies 

7 as a trade secret subject to withholding from public 

8 dissemination. Any data or information provided 

9 under this paragraph shall not be subject to disclo10 sure under section 552 of title 5, United States 

11 Code (commonly referred to as the Freedom of In12 formation Act). 

13 SEC. 7. DEFINITION OF NATIONAL HEALTH INSURANCE EX14 CHANGE. 

15 In this Act, the term ‘‘National Health Insurance Ex16 change’’ means a mechanism established or recognized 

17 under Federal law for coordinating the offering of health 

18 insurance coverage to individuals in the United States 

19 through the establishment of standards for benefits, cost20 sharing, and premiums for such health insurance cov21 erage. 

Æ 


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