I 

113TH CONGRESS 

1ST SESSION H. R. 3504 

To provide improved consumer protection and rate review for health insurance 

coverage in the individual market, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

NOVEMBER 15, 2013 

Ms. SCHAKOWSKY introduced the following bill; which was referred to the 

Committee on Energy and Commerce 

A BILL 

To provide improved consumer protection and rate review 

for health insurance coverage in the individual market, 

and for other purposes. 

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 ‘‘Consumer Protection 

5 and Rate Review Act of 2013’’. 


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1 SEC. 2. REQUIRING STATE INSURANCE COMMISSIONERS TO 

2 INVESTIGATE INSTANCES OF INADEQUATE 

3 NOTICES OF CANCELLATION OR CONVER4 SION OF INDIVIDUAL HEALTH INSURANCE 

5 POLICIES. 

6 (a) IN GENERAL.—Each State insurance commis7 sioner shall investigate and take appropriate administra8 tive or other actions (such as the imposition of a fine) 

9 on cases of inadequate notices of cancellations or conver10 sions of health insurance coverage in the individual market 

11 that take effect on or after January 1, 2014. 

12 (b) INADEQUATE NOTICE.—In this section, a notice 

13 of the cancellation or conversion of individual health insur14 ance coverage shall be treated as inadequate if the no15 tice— 

16 (1) fails to contain information— 

17 (A) on obtaining health insurance coverage 

18 through an Exchange under the Patient Protec19 tion and Affordable Care Act; 

20 (B) on the possible availability of assist21 ance under such Act towards payment of the 

22 premiums and cost-sharing for such coverage; 

23 and 

24 (C) on the improved benefits for coverage 

25 through an Exchange, compared to health inVerDate Mar 15 2010 01:51 Nov 16, 2013 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3504.IH H3504

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1 surance coverage not offered through an Ex2 change; 

3 (2) fails to be transparent by inappropriately 

4 steering individuals to more expensive plans provided 

5 by the cancelling issuer; or 

6 (3) fails to otherwise comply with requirements 

7 of law. 

8 (c) REPORTS.— 

9 (1) STATE COMMISSIONERS TO HHS.—Not later 

10 than March 31, 2014, each State insurance commis11 sioner shall submit to the Secretary of Health and 

12 Human Services a report on the investigations and 

13 actions described in subsection (a). 

14 (2) HHS REPORT TO CONGRESS.—Not later 

15 than April 30, 2014, the Secretary shall submit to 

16 Congress a report on such investigations and ac17 tions. 

18 (d) DEFINITIONS OF STATE, HEALTH INSURANCE

19 COVERAGE, AND INDIVIDUAL MARKET.—In this section, 

20 the terms ‘‘State’’, ‘‘health insurance coverage’’, and ‘‘in21 dividual market’’ have the meanings given such terms for 

22 purposes of title I of the Patient Protection and Afford23 able Care Act. 


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1 SEC. 3. PROTECTION OF CONSUMERS FROM EXCESSIVE, 

2 UNJUSTIFIED, OR UNFAIRLY DISCRIMINA3 TORY RATES øFROM H.R. 1019¿. 

4 (a) PROTECTION FROM EXCESSIVE, UNJUSTIFIED, 

5 OR UNFAIRLY DISCRIMINATORY RATES.—The first sec6 tion 2794 of the Public Health Service Act (42 U.S.C. 

7 300gg–94), as added by section 1003 of the Patient Pro8 tection and Affordable Care Act (Public Law 111–148), 

9 is amended by adding at the end the following new sub10 section: 

11 ‘‘(e) PROTECTION FROM EXCESSIVE, UNJUSTIFIED, 

12 OR UNFAIRLY DISCRIMINATORY RATES.— 

13 ‘‘(1) AUTHORITY OF STATES.—Nothing in this 

14 section shall be construed to prohibit a State from 

15 imposing requirements (including requirements re16 lating to rate review standards and procedures and 

17 information reporting) on health insurance issuers 

18 with respect to rates that are in addition to the re19 quirements of this section and are more protective of 

20 consumers than such requirements. 

21 ‘‘(2) CONSULTATION IN RATE REVIEW PROC22 ESS.—In carrying out this section, the Secretary 

23 shall consult with the National Association of Insur24 ance Commissioners and consumer groups. 

25 ‘‘(3) DETERMINATION OF WHO CONDUCTS RE26 VIEWS FOR EACH STATE.—The Secretary shall deVerDate Mar 15 2010 01:51 Nov 16, 2013 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H3504.IH H3504

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1 termine, after the date of enactment of this section 

2 and periodically thereafter, the following: 

3 ‘‘(A) In which markets in each State the 

4 State insurance commissioner or relevant State 

5 regulator shall undertake the corrective actions 

6 under paragraph (4), as a condition of the 

7 State receiving the grant in subsection (c), 

8 based on the Secretary’s determination that the 

9 State regulator is adequately undertaking and 

10 utilizing such actions in that market. 

11 ‘‘(B) In which markets in each State the 

12 Secretary shall undertake the corrective actions 

13 under paragraph (4), in cooperation with the 

14 relevant State insurance commissioner or State 

15 regulator, based on the Secretary’s determina16 tion that the State is not adequately under17 taking and utilizing such actions in that mar18 ket. 

19 ‘‘(4) CORRECTIVE ACTION FOR EXCESSIVE, UN20 JUSTIFIED, OR UNFAIRLY DISCRIMINATORY

21 RATES.—In accordance with the process established 

22 under this section, the Secretary or the relevant 

23 State insurance commissioner or State regulator 

24 shall take corrective actions to ensure that any ex25 cessive, unjustified, or unfairly discriminatory rates 


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1 are corrected prior to implementation, or as soon as 

2 possible thereafter, through mechanisms such as— 

3 ‘‘(A) denying rates; 

4 ‘‘(B) modifying rates; or 

5 ‘‘(C) requiring rebates to consumers. 

6 ‘‘(5) NONCOMPLIANCE.—Failure to comply with 

7 any corrective action taken by the Secretary under 

8 this subsection may result in the application of civil 

9 monetary penalties and, if the Secretary determines 

10 appropriate, make the plan involved ineligible for 

11 classification as a Qualified Health Plan.’’. 

12 (b) CLARIFICATION OF REGULATORY AUTHORITY.— 

13 Such section is further amended— 

14 (1) in subsection (a)— 

15 (A) in the heading, by striking ‘‘PRE16 MIUM’’ and inserting ‘‘RATE’’; 

17 (B) in paragraph (1), by striking ‘‘unrea18 sonable increases in premiums’’ and inserting 

19 ‘‘potentially excessive, unjustified, or unfairly 

20 discriminatory rates, including premiums,’’; and 

21 (C) in paragraph (2)— 

22 (i) by striking ‘‘an unreasonable pre23 mium increase’’ and inserting ‘‘a poten24 tially excessive, unjustified, or unfairly dis25 criminatory rate’’; 


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1 (ii) by striking ‘‘the increase’’ and in2 serting ‘‘the rate’’; and 

3 (iii) by striking ‘‘such increases’’ and 

4 inserting ‘‘such rates’’; 

5 (2) in subsection (b)— 

6 (A) by striking ‘‘premium increases’’ each 

7 place it appears and inserting ‘‘rates’’; and 

8 (B) in paragraph (2)(B), by striking ‘‘pre9 mium’’ and inserting ‘‘rate’’; and 

10 (3) in subsection (c)(1)— 

11 (A) in the heading, by striking ‘‘PRE12 MIUM’’ and inserting ‘‘RATE’’; 

13 (B) by inserting ‘‘that satisfy the condition 

14 under subsection (e)(3)(A)’’ after ‘‘award 

15 grants to States’’; and 

16 (C) in subparagraph (A), by striking ‘‘pre17 mium increases’’ and inserting ‘‘rates’’. 

18 (c) CONFORMING AMENDMENT.—Title XXVII of the 

19 Public Health Service Act (42 U.S.C. 300gg et seq.) is 

20 amended— 

21 (1) in section 2723 (42 U.S.C. 300gg–22), as 

22 redesignated by the Patient Protection and Afford23 able Care Act— 

24 (A) in subsection (a)— 


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1 (i) in paragraph (1), by inserting 

2 ‘‘and section 2794’’ after ‘‘this part’’; and 

3 (ii) in paragraph (2), by inserting ‘‘or 

4 section 2794’’ after ‘‘this part’’; and 

5 (B) in subsection (b)— 

6 (i) in paragraph (1), by inserting 

7 ‘‘and section 2794’’ after ‘‘this part’’; and 

8 (ii) in paragraph (2)— 

9 (I) in subparagraph (A), by in10 serting ‘‘or section 2794 that is’’ after 

11 ‘‘this part’’; and 

12 (II) in subparagraph (C)(ii), by 

13 inserting ‘‘or section 2794’’ after 

14 ‘‘this part’’; and 

15 (2) in section 2761 (42 U.S.C. 300gg–61)— 

16 (A) in subsection (a)— 

17 (i) in paragraph (1), by inserting 

18 ‘‘and section 2794’’ after ‘‘this part’’; and 

19 (ii) in paragraph (2)— 

20 (I) by inserting ‘‘or section 

21 2794’’ after ‘‘set forth in this part’’; 

22 and 

23 (II) by inserting ‘‘and section 

24 2794’’ after ‘‘the requirements of this 

25 part’’; and 


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1 (B) in subsection (b)— 

2 (i) by inserting ‘‘and section 2794’’ 

3 after ‘‘this part’’; and 

4 (ii) by inserting ‘‘and section 2794’’ 

5 after ‘‘part A’’. 

6 (d) APPLICABILITY TO GRANDFATHERED PLANS.— 

7 Section 1251(a)(4)(A) of the Patient Protection and Af8 fordable Care Act (Public Law 111–148), as added by sec9 tion 2301 of the Health Care and Education Reconcili10 ation Act of 2010 (Public Law 111–152), is amended by 

11 adding at the end the following: 

12 ‘‘(v) Section 2794 (relating to reason13 ableness of rates with respect to health in14 surance coverage).’’. 

15 (e) AUTHORIZATION OF APPROPRIATIONS.—There 

16 are authorized to be appropriated to carry out this section, 

17 such sums as may be necessary. 

18 (f) EFFECTIVE DATE.—The amendments made by 

19 this section shall take effect on the date of enactment of 

20 this Act and shall be implemented with respect to health 

21 plans beginning not later than January 1, 2014. 

Æ 


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