IB 

Union Calendar No. 334 

116TH CONGRESS 

2D SESSION H. R. 1425 

[Report No. 116–414] 

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 

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

was referred to the Committee on Energy and Commerce 

MARCH 9, 2020 

Additional sponsors: Ms. UNDERWOOD, Mr. SCHRADER, Ms. KUSTER of New 

Hampshire, Mr. LIPINSKI, Mr. CARBAJAL, Mr. HECK, Ms. BROWNLEY of 

California, Ms. SCHAKOWSKY, Mr. HIMES, Ms. BLUNT ROCHESTER, Mr. 

CISNEROS, Ms. SCHRIER, Mrs. LEE of Nevada, Mr. LUJA ́N, Mr. ALLRED, 

Mr. ROUDA, Ms. HILL of California, Mrs. BUSTOS, Mr. TRONE, Mr. 

BERA, Mr. ROSE of New York, Ms. FINKENAUER, Mr. LARSEN of Washington, Mr. COSTA, Mrs. DINGELL, Mr. RUIZ, Mr. RUSH, Mr. SCHIFF, 

Mr. PALLONE, Ms. ESHOO, Mr. KENNEDY, Ms. MATSUI, Ms. 

SPANBERGER, Mr. PHILLIPS, Mr. VAN DREW, Mr. CASE, Ms. CLARKE

of New York, Mr. BRINDISI, Mr. NEGUSE, Ms. MCCOLLUM, Mr. 

MCADAMS, Ms. MOORE, Mr. KILMER, Ms. STEVENS, Ms. MUCARSELPOWELL, Mr. TONKO, Ms. KELLY of Illinois, Ms. BARRAGA ́N, Mr. 

CA ́RDENAS, Mr. WELCH, Mr. RASKIN, Ms. LOFGREN, Ms. DAVIDS of 

Kansas, Mrs. LURIA, Mr. FORTENBERRY, Mrs. KIRKPATRICK, Miss RICE

of New York, Ms. WEXTON, Ms. SPEIER, and Mr. CONNOLLY


pamtmann on DSKBC07HB2PROD with BILLS
2 

•HR 1425 RH

MARCH 9, 2020 

Reported with an amendment; committed to the Committee of the Whole 

House on the State of the Union and ordered to be printed 

[Strike out all after the enacting clause and insert the part printed in italic] 

[For text of introduced bill, see copy of bill as introduced on February 28, 2019] 

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. 


pamtmann on DSKBC07HB2PROD with BILLS
3 

•HR 1425 RH

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’’. 

6 SEC. 2. IMPROVE HEALTH INSURANCE AFFORDABILITY 

7 FUND. 

8 Subtitle D of title I of the Patient Protection and Af9 fordable Care Act is amended by inserting after part 5 (42 

10 U.S.C. 18061 et seq.) the following new part: 

11 ‘‘PART 6—IMPROVE HEALTH INSURANCE 

12 AFFORDABILITY FUND 

13 ‘‘SEC. 1351. ESTABLISHMENT OF PROGRAM. 

14 ‘‘There is hereby established the ‘Improve Health In15 surance Affordability Fund’ to be administered by the Sec16 retary of Health and Human Services, acting through the 

17 Administrator of the Centers for Medicare & Medicaid Serv18 ices (in this section referred to as the ‘Administrator’), to 

19 provide funding, in accordance with this part, to the 50 

20 States and the District of Columbia (each referred to in 

21 this section as a ‘State’) beginning on January 1, 2020, 

22 for the purposes described in section 1352. 


pamtmann on DSKBC07HB2PROD with BILLS
4 

•HR 1425 RH

1 ‘‘SEC. 1352. USE OF FUNDS. 

2 ‘‘(a) IN GENERAL.—A State shall use the funds allo3 cated to the State under this part for one of the following 

4 purposes: 

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

6 insurance issuers with respect to individuals enrolled 

7 under individual health insurance coverage (other 

8 than through a plan described in subsection (b)) of9 fered by such issuers. 

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

11 payments described in paragraph (1)) to reduce out12 of-pocket costs, such as copayments, coinsurance, pre13 miums, and deductibles, of individuals enrolled under 

14 qualified health plans offered on the individual mar15 ket through an Exchange. 

16 ‘‘(b) EXCLUSION OF CERTAIN GRANDFATHERED AND

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

18 plan described in this subsection is the following: 

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

20 section 1251). 

21 ‘‘(2) A plan (commonly referred to as a ‘transi22 tional plan’) continued under the letter issued by the 

23 Centers for Medicare & Medicaid Services on Novem24 ber 14, 2013, to the State Insurance Commissioners 

25 outlining a transitional policy for coverage in the in26 dividual and small group markets to which section 


pamtmann on DSKBC07HB2PROD with BILLS
5 

•HR 1425 RH

1 1251 does not apply, and under the extension of the 

2 transitional policy for such coverage set forth in the 

3 Insurance Standards Bulletin Series guidance issued 

4 by the Centers for Medicare & Medicaid Services on 

5 March 5, 2014, February 29, 2016, February 13, 

6 2017, April 9, 2018, and March 25, 2019, or under 

7 any subsequent extensions thereof. 

8 ‘‘(3) Student health insurance coverage (as de9 fined in section 147.145 of title 45, Code of Federal 

10 Regulations). 

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

12 SAFEGUARD. 

13 ‘‘(a) ENCOURAGING STATE OPTIONS FOR ALLOCA14 TIONS.— 

15 ‘‘(1) IN GENERAL.—To be eligible for an alloca16 tion of funds under this part for a year (beginning 

17 with 2020), a State shall submit to the Administrator 

18 an application at such time (but, in the case of allo19 cations for 2020, not later than 90 days after the date 

20 of the enactment of this part and, in the case of allo21 cations for a subsequent year, not later than March 

22 1 of the previous year) and in such form and manner 

23 as specified by the Administrator containing— 

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

25 used; and 


pamtmann on DSKBC07HB2PROD with BILLS
6 

•HR 1425 RH

1 ‘‘(B) such other information as the Admin2 istrator may require. 

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

4 submitted is approved unless the Administrator noti5 fies the State submitting the application, not later 

6 than 60 days after the date of the submission of such 

7 application, that the application has been denied for 

8 not being in compliance with any requirement of this 

9 part and of the reason for such denial. 

10 ‘‘(3) 5-YEAR APPLICATION APPROVAL.—If an ap11 plication of a State is approved for a purpose de12 scribed in section 1352 for a year, such application 

13 shall be treated as approved for such purpose for each 

14 of the subsequent 4 years. 

15 ‘‘(4) REVOCATION OF APPROVAL.—The approval 

16 of an application of a State, with respect to a pur17 pose described in section 1352, may be revoked if the 

18 State fails to use funds provided to the State under 

19 this section for such purpose or otherwise fails to com20 ply with the requirements of this section. 

21 ‘‘(b) DEFAULT FEDERAL SAFEGUARD.— 

22 ‘‘(1) 2020.—For 2020, in the case of a State that 

23 does not submit an application under subsection (a) 

24 by the 90-day submission date applicable to such year 

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


pamtmann on DSKBC07HB2PROD with BILLS
7 

•HR 1425 RH

1 that does submit such an application by such date 

2 that is not approved, the Administrator, in consulta3 tion with the State insurance commissioner, shall, 

4 from the amount calculated under paragraph (4) for 

5 such year, carry out the purpose described in para6 graph (3) in such State for such year. 

7 ‘‘(2) 2021 AND SUBSEQUENT YEARS.—For 2021 

8 or a subsequent year, in the case of a State that does 

9 not have in effect an approved application under this 

10 section for such year, the Administrator, in consulta11 tion with the State insurance commissioner, shall, 

12 from the amount calculated under paragraph (4) for 

13 such year, carry out the purpose described in para14 graph (3) in such State for such year. 

15 ‘‘(3) SPECIFIED USE.—The amount described in 

16 paragraph (4), with respect to 2020 or a subsequent 

17 year, shall be used to carry out the purpose described 

18 in section 1352(a)(1) in each State described in para19 graph (1) or (2) for such year, as applicable, by pro20 viding reinsurance payments to health insurance 

21 issuers with respect to attachment range claims (as 

22 defined in section 1354(b)(2)), using the dollar 

23 amounts specified in subparagraph (B) of such sec24 tion for such year) in an amount equal to, subject to 

25 paragraph (5), the percentage (specified for such year 


pamtmann on DSKBC07HB2PROD with BILLS
8 

•HR 1425 RH

1 by the Secretary under such subparagraph) of the 

2 amount of such claims. 

3 ‘‘(4) AMOUNT DESCRIBED.—The amount de4 scribed in this paragraph, with respect to 2020 or a 

5 subsequent year, is the amount equal to the total sum 

6 of amounts that the Secretary would otherwise esti7 mate under section 1354(b)(2)(A)(i) for such year for 

8 each State described in paragraph (1) or (2) for such 

9 year, as applicable, if each such State were not so de10 scribed for such year. 

11 ‘‘(5) ADJUSTMENT.—For purposes of this sub12 section, the Secretary may apply a percentage under 

13 paragraph (3) with respect to a year that is less than 

14 the percentage otherwise specified in section 

15 1354(b)(2)(B) for such year, if the cost of paying the 

16 total eligible attachment range claims for States de17 scribed in this subsection for such year at such per18 centage otherwise specified would exceed the amount 

19 calculated under paragraph (4) for such year. 

20 ‘‘SEC. 1354. ALLOCATIONS. 

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

22 allocations for States under subsection (b) and payments 

23 under section 1353(b) there is appropriated, out of any 

24 money in the Treasury not otherwise appropriated, 

25 $10,000,000,000 for 2020 and each subsequent year. 


pamtmann on DSKBC07HB2PROD with BILLS
9 

•HR 1425 RH

1 ‘‘(b) ALLOCATIONS.— 

2 ‘‘(1) PAYMENT.— 

3 ‘‘(A) IN GENERAL.—From amounts appro4 priated under subsection (a) for a year, the Sec5 retary shall, with respect to a State not described 

6 in section 1353(b) for such year and not later 

7 than the date specified under subparagraph (B) 

8 for such year, allocate for such State the amount 

9 determined for such State and year under para10 graph (2). 

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

12 subparagraph (A), the date specified in this sub13 paragraph is— 

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

15 after the date of the enactment of this part; 

16 and 

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

18 January 1 of the respective year. 

19 ‘‘(C) NOTIFICATIONS OF ALLOCATION

20 AMOUNTS.—For 2021 and each subsequent year, 

21 the Secretary shall notify each State of the 

22 amount determined for such State under para23 graph (2) for such year by not later than Janu24 ary 1 of the previous year. 

25 ‘‘(2) ALLOCATION AMOUNT DETERMINATIONS.— 


pamtmann on DSKBC07HB2PROD with BILLS
10 

•HR 1425 RH

1 ‘‘(A) IN GENERAL.—For purposes of para2 graph (1), the amount determined under this 

3 paragraph for a year for a State described in 

4 paragraph (1)(A) for such year is the amount 

5 equal to— 

6 ‘‘(i) the amount that the Secretary esti7 mates would be expended under this part 

8 for such year on attachment range claims of 

9 individuals residing in such State if such 

10 State used such funds only for the purpose 

11 described in paragraph (1) of section 

12 1352(a) at the dollar amounts and percent13 age specified under subparagraph (B) for 

14 such year; minus 

15 ‘‘(ii) the amount, if any, by which the 

16 Secretary determines— 

17 ‘‘(I) the estimated amount of pre18 mium tax credits under section 36B of 

19 the Internal Revenue Code of 1986 that 

20 would be attributable to individuals re21 siding in such State for such year 

22 without application of this part; ex23 ceeds 

24 ‘‘(II) the estimated amount of pre25 mium tax credits under section 36B of 


pamtmann on DSKBC07HB2PROD with BILLS
11 

•HR 1425 RH

1 the Internal Revenue Code of 1986 that 

2 would be attributable to individuals re3 siding in such State for such year if 

4 such State were a State described in 

5 section 1353(b) for such year. 

6 For purposes of the previous sentence and section 

7 1353(b)(3), the term ‘attachment range claims’ 

8 means, with respect to an individual, the claims 

9 for such individual that exceed a dollar amount 

10 specified by the Secretary for a year, but do not 

11 exceed a ceiling dollar amount specified by the 

12 Secretary for such year, under subparagraph 

13 (B). 

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

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

16 Secretary shall determine the dollar amounts 

17 and the percentage to be specified under this sub18 paragraph for a year in a manner to ensure that 

19 the total amount of expenditures under this part 

20 for such year is estimated to equal the total 

21 amount appropriated for such year under sub22 section (a) if such expenditures were used solely 

23 for the purpose described in paragraph (1) of 

24 section 1352(a) for attachment range claims at 


pamtmann on DSKBC07HB2PROD with BILLS
12 

•HR 1425 RH

1 the dollar amounts and percentage so specified 

2 for such year. 

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

4 under this subsection for a year shall remain avail5 able through the end of the subsequent year.’’. 


pamtmann on DSKBC07HB2PROD with BILLS

pamtmann on DSKBC07HB2PROD with BILLS
Union Calendar No. 334 

116TH CONGRESS 

2D SESSION H. R. 1425 

[Report No. 116–414] 

A BILL 

To amend the Patient Protection and Affordable 

dividual health insurance market. insurance payments to lower premiums in the inance Affordability Fund to provide for certain reCare Act to provide for a Improve Health InsurMARCH 9, 2020 

Reported with an amendment; committed to the Comand ordered to be printed mittee of the Whole House on the State of the Union 


pamtmann on DSKBC07HB2PROD with BILLS