I 

116TH CONGRESS 

1ST SESSION H. R. 1425 

To amend the Patient Protection and Affordable Care Act to provide for 

a Improve Health Insurance Affordability Fund to provide for certain 

reinsurance payments to lower premiums in the individual health insurance market. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 28, 2019 

Mrs. CRAIG (for herself and Mr. PETERS) introduced the following bill; which 

was referred to the Committee on Energy and Commerce 

A BILL 

To amend the Patient Protection and Affordable Care Act 

to provide for a Improve Health Insurance Affordability 

Fund to provide for certain reinsurance payments to 

lower premiums in the individual health insurance market. 

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 ‘‘State Health Care Pre5 mium Reduction Act’’. 


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1 SEC. 2. IMPROVE HEALTH INSURANCE AFFORDABILITY 

2 FUND. 

3 Subtitle D of title I of the Patient Protection and 

4 Affordable Care Act is amended by inserting after part 

5 5 (42 U.S.C. 18061 et seq.) the following new part: 

6 ‘‘PART 6—IMPROVE HEALTH INSURANCE 

7 AFFORDABILITY FUND 

8 ‘‘SEC. 1351. ESTABLISHMENT OF PROGRAM. 

9 ‘‘There is hereby established the ‘Improve Health In10 surance Affordability Fund’ to be administered by the Sec11 retary of Health and Human Services, acting through the 

12 Administrator of the Centers for Medicare & Medicaid 

13 Services (in this section referred to as the ‘Adminis14 trator’), to provide funding, in accordance with this title, 

15 to the 50 States and the District of Columbia (each re16 ferred to in this section as a ‘State’) beginning on January 

17 1, 2020, for the purposes described in section 1352. 

18 ‘‘SEC. 1352. USE OF FUNDS. 

19 ‘‘(a) IN GENERAL.—A State shall use the funds allo20 cated to the State under this part for one of the following 

21 purposes: 

22 ‘‘(1) To provide reinsurance payments to health 

23 insurance issuers with respect to individuals enrolled 

24 under individual health insurance coverage (other 

25 than through a plan described in subsection (b)) of26 fered by such issuers. 


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1 ‘‘(2) To provide assistance (other than through 

2 payments described in paragraph (1)) to reduce out3 of-pocket costs, such as copayments, coinsurance, 

4 premiums, and deductibles, of individuals enrolled 

5 under qualified health plans offered on the indi6 vidual market through an Exchange. 

7 ‘‘(b) EXCLUSION OF CERTAIN GRANDFATHERED AND

8 TRANSITIONAL PLANS.—For purposes of subsection (a), 

9 a plan described in this subsection is the following: 

10 ‘‘(1) A grandfathered health plan (as defined in 

11 section 1251). 

12 ‘‘(2) A plan (commonly referred to as a ‘transi13 tional plan’) continued under the letter issued by the 

14 Centers for Medicare & Medicaid Services on No15 vember 14, 2013, to the State Insurance Commis16 sioners outlining a transitional policy for coverage in 

17 the individual and small group markets to which sec18 tion 1251 does not apply, and under the extension 

19 of the transitional policy for such coverage set forth 

20 in the Insurance Standards Bulletin Series guidance 

21 issued by the Centers for Medicare & Medicaid Serv22 ices on March 5, 2014, February 29, 2016, Feb23 ruary 13, 2017, and April 9, 2018, or under any 

24 subsequent extensions thereof. 


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1 ‘‘SEC. 1353. STATE ELIGIBILITY AND APPROVAL; DEFAULT 

2 SAFEGUARD. 

3 ‘‘(a) ENCOURAGING STATE OPTIONS FOR ALLOCA4 TIONS.— 

5 ‘‘(1) IN GENERAL.—To be eligible for an alloca6 tion of funds under this part for a year (beginning 

7 with 2020), a State shall submit to the Adminis8 trator an application at such time (but, in the case 

9 of allocations for 2020, not later than 90 days after 

10 the date of the enactment of this title and, in the 

11 case of allocations for a subsequent year, not later 

12 than March 31 of the previous year) and in such 

13 form and manner as specified by the Administrator 

14 containing— 

15 ‘‘(A) a description of how the funds will be 

16 used; and 

17 ‘‘(B) such other information as the Admin18 istrator may require. 

19 ‘‘(2) AUTOMATIC APPROVAL.—An application so 

20 submitted is approved unless the Administrator noti21 fies the State submitting the application, not later 

22 than 60 days after the date of the submission of 

23 such application, that the application has been de24 nied for not being in compliance with any require25 ment of this part and of the reason for such denial. 


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1 ‘‘(3) 5-YEAR APPLICATION APPROVAL.—If an 

2 application of a State is approved for a purpose de3 scribed in section 1352 for a year, such application 

4 shall be treated as approved for such purpose for 

5 each of the subsequent 4 years. 

6 ‘‘(b) DEFAULT FEDERAL SAFEGUARD.— 

7 ‘‘(1) 2020.—For allocations made under this 

8 part for 2020, in the case of a State that does not 

9 submit an application under subsection (a) by the 

10 90-day submission date applicable to such year 

11 under subsection (a)(1) and in the case of a State 

12 that does submit such an application by such date 

13 that is not approved, the Administrator, in consulta14 tion with the State insurance commissioner, shall 

15 use, in accordance with paragraph (3), the allocation 

16 that would otherwise be provided to the State under 

17 this part for such year for such State. 

18 ‘‘(2) 2021 AND SUBSEQUENT YEARS.—In the 

19 case of a State that does not have in effect an ap20 proved application under this section for 2021 or a 

21 subsequent year, the Administrator, in consultation 

22 with the State insurance commissioner, shall use, in 

23 accordance with paragraph (3), the allocation that 

24 would otherwise be provided to the State under this 

25 part for such year for such State. 


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1 ‘‘(3) SPECIFIED USE.—An allocation for a 

2 State made pursuant to paragraph (1) or (2) for a 

3 year shall be used to carry out the purpose described 

4 in section 1352(1) in such State by providing rein5 surance payments to health insurance issuers with 

6 respect to attachment range claims (as defined in 

7 section 1354(b)(2), using the dollar amounts speci8 fied in subparagraph (B) of such section for such 

9 year) in an amount equal to the percentage (speci10 fied for such year by the Secretary under such sub11 paragraph) of the amount of such claims. 

12 ‘‘SEC. 1354. ALLOCATIONS. 

13 ‘‘(a) APPROPRIATION.—For the purpose of providing 

14 allocations for States under this part there is appro15 priated, out of any money in the Treasury not otherwise 

16 appropriated $10,000,000,000 for 2020 and each subse17 quent year. 

18 ‘‘(b) ALLOCATIONS.— 

19 ‘‘(1) PAYMENT.— 

20 ‘‘(A) IN GENERAL.—From amounts appro21 priated under subsection (a) for a year, the 

22 Secretary shall, with respect to a State and not 

23 later than the date specified under subpara24 graph (B) for such year, allocate for such State 


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1 the amount determined for such State and year 

2 under paragraph (2). 

3 ‘‘(B) SPECIFIED DATE.—For purposes of 

4 subparagraph (A), the date specified in this 

5 subparagraph is— 

6 ‘‘(i) for 2020, the date that is 45 days 

7 after the date of the enactment of this 

8 title; and 

9 ‘‘(ii) for 2021 or a subsequent year, 

10 January 1 of the respective year. 

11 ‘‘(C) NOTIFICATIONS OF ALLOCATION

12 AMOUNTS.—For 2021 and each subsequent 

13 year, the Secretary shall notify each State of 

14 the amount determined for such State under 

15 paragraph (2) for such year by not later than 

16 January 1 of the previous year. 

17 ‘‘(2) ALLOCATION AMOUNT DETERMINA18 TIONS.— 

19 ‘‘(A) IN GENERAL.—For purposes of para20 graph (1), the amount determined under this 

21 paragraph for a year for a State is the amount 

22 that the Secretary estimates would be expended 

23 under this part for such year on attachment 

24 range claims of individuals residing in such 

25 State if all States used such funds only for the 


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1 purpose described in paragraph (1) of section 

2 1352 at the dollar amounts and percentage 

3 specified under subparagraph (B) for such year. 

4 For purposes of the previous sentence and sec5 tion 1353(b)(3), the term ‘attachment range 

6 claims’ means, with respect to an individual, the 

7 claims for such individual that exceed a dollar 

8 amount specified by the Secretary for a year, 

9 but do not exceed a ceiling dollar amount speci10 fied by the Secretary for such year, under sub11 paragraph (B). 

12 ‘‘(B) SPECIFICATIONS.—For purposes of 

13 subparagraph (A) and section 1353(b)(3), the 

14 Secretary shall determine the dollar amounts 

15 and the percentage to be specified under sub16 paragraph (A) for a year in a manner to ensure 

17 that the total amount of expenditures under 

18 this part for such year is estimated to equal the 

19 total amount appropriated for such year under 

20 subsection (a) if such expenditures were used 

21 solely for the purpose described in paragraph 

22 (1) of section 1352 for attachment range claims 

23 at the dollar amounts and percentage so speci24 fied for such year. 


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1 ‘‘(3) AVAILABILITY.—Funds allocated to a 

2 State under this subsection for a year shall remain 

3 available through the end of the subsequent year. 

4 ‘‘(c) ANNUAL DISTRIBUTION OF PREVIOUS YEAR’S

5 REMAINING FUNDS.— 

6 ‘‘(1) IN GENERAL.— In carrying out subsection 

7 (b), the Secretary shall, with respect to a year (be8 ginning with 2021), not later than March 31 of such 

9 year— 

10 ‘‘(A) determine the amount of funds, if 

11 any, from the amounts appropriated under sub12 section (a) for the previous year but not allo13 cated for such previous year; and 

14 ‘‘(B) if the Secretary determines that any 

15 funds were not so allocated for such previous 

16 year, allocate such remaining funds to States 

17 for such year, in accordance with paragraph 

18 (2). 

19 ‘‘(2) ALLOCATION METHODOLOGY.—For pur20 poses of paragraph (1), of the total remaining funds 

21 to be allocated for a year pursuant to such para22 graph, the Secretary shall allocate to each State an 

23 amount that bears the same ratio to such total re24 maining funds as the amount allocated pursuant to 

25 subsection (b) to such State for such year bears to 


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1 the total allocations made under such subsection for 

2 such year.’’. 

Æ 


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