I 

114TH CONGRESS 

1ST SESSION H. R. 2756 

To reform the provision of health insurance coverage by promoting health 

savings accounts, State-based alternatives to coverage under the Affordable Care Act, and price transparency, in order to promote a more 

market-based health care system, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 12, 2015 

Mr. ABRAHAM introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committees on 

Ways and Means and Education and the Workforce, for a period to be 

subsequently determined by the Speaker, in each case for consideration 

of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To reform the provision of health insurance coverage by 

promoting health savings accounts, State-based alternatives to coverage under the Affordable Care Act, and 

price transparency, in order to promote a more marketbased health care system, 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; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Patient Freedom Act of 2015’’. 


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1 (b) TABLE OF CONTENTS.—The table of contents for 

2 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Sense of Congress. 

TITLE I—HEALTH REFORM 

Sec. 100. Definitions. 

Subtitle A—Insurance Reforms 

Sec. 101. State options in response to Burwell decision. 

Sec. 102. State alternative option. 

Sec. 103. Computation of monthly HSA deposit amount for deposit qualifying 

residents. 

Sec. 104. State options for improved access to health insurance coverage in 

each State. 

Sec. 105. Expanded access and patient protections. 

Sec. 106. Sunsetting certain ACA provisions; continuation of policies of covering adult children and not applying lifetime or annual limits. 

Subtitle B—Medicaid 

Sec. 111. Application of health savings accounts in relation to Medicaid. 

Subtitle C—Provider Price Transparency 

Sec. 121. Ensuring access to emergency services without excessive charges for 

out-of-network services. 

TITLE II—REFORM OF TAX PROVISIONS RELATING TO HEALTH 

CARE 

Subtitle A—Promotion of Health Savings Accounts 

Sec. 201. Repeal of high deductible health plan requirement. 

Sec. 202. Treatment of HSA after death of account beneficiary. 

Sec. 203. Purchase of health insurance from HSA account. 

Sec. 204. Publishing of cash price for care paid through health savings accounts. 

Subtitle B—Health Care Tax Credits 

Sec. 211. Limited application of PPACA health premium credit. 

Sec. 212. New HSA credit. 

3 SEC. 2. SENSE OF CONGRESS. 

4 It is the sense of Congress that there is a need for 

5 legislation providing temporary transition funding for 

6 those who lose health insurance subsidies in the aftermath 


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1 of a Supreme Court decision in favor of the plaintiffs-ap2 pellants in the case of King v. Burwell. 

3 TITLE I—HEALTH REFORM 

4 SEC. 100. DEFINITIONS. 

5 In this title: 

6 (1) PATIENT-GRANT ELECTING STATE.—The 

7 term ‘‘patient-grant electing State’’ means an elect8 ing State that specifies under section 102(a)(4)(B) 

9 that it will carry out section 102(b) itself (and not 

10 to have section 102(b) carried out by means of the 

11 credit under section 36C of the Internal Revenue 

12 Code of 1986). 

13 (2) CHIP.—The term ‘‘CHIP’’ means the chil14 dren’s health insurance program established under 

15 title XXI of the Social Security Act (42 U.S.C. 1396 

16 et seq.). 

17 (3) CREDITABLE COVERAGE.—The term ‘‘cred18 itable coverage’’ has the meaning given such term in 

19 section 2704(c)(1) of the Public Health Service Act 

20 (42 U.S.C. 300gg–3(c)(1)), as in effect as of the day 

21 before the date of the enactment of this Act. 

22 (4) DEFAULT HEALTH INSURANCE COV23 ERAGE.—The term ‘‘default health insurance cov24 erage’’ has the meaning given such term in section 

25 104(c)(2). 


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1 (5) DEPOSIT QUALIFYING RESIDENT.—The 

2 term ‘‘deposit qualifying resident’’ has the meaning 

3 given such term in section 102(b)(2). 

4 (6) ELECTING STATE.—The term ‘‘electing 

5 State’’ means a State that elects under section 

6 101(a)(3) the alternative option described in section 

7 102. 

8 (7) HEALTH INSURANCE COVERAGE.—The term 

9 ‘‘health insurance coverage’’ has the meaning given 

10 such term in section 2791(b)(1) of the Public Health 

11 Service Act (42 U.S.C. 300gg–91(b)(1)). 

12 (8) HEALTH SAVINGS ACCOUNT; HSA.—The 

13 terms ‘‘health savings account’’ and ‘‘HSA’’ mean a 

14 health savings account established under section 223 

15 of the Internal Revenue Code of 1986. 

16 (9) HEALTH SAVINGS DEPOSIT.—The term 

17 ‘‘health savings deposit’’ means a deposit made into 

18 a health savings account pursuant to section 102. 

19 (10) MEDICAID.—The term ‘‘Medicaid’’ means 

20 the program under title XIX of the Social Security 

21 Act (42 U.S.C. 1396 et seq.). 

22 (11) MEDICARE.—The term ‘‘Medicare’’ means 

23 the program under part A or B of title XVIII of the 

24 Social Security Act (42 U.S.C. 1395 et seq.). 


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1 (12) PPACA.—The term ‘‘PPACA’’ means the 

2 Patient Protection and Affordable Care Act (Public 

3 Law 111–148), as in effect before the date of the 

4 enactment of this Act, unless otherwise specified. 

5 (13) QUALIFIED HEALTH PLAN COVERAGE.— 

6 The term ‘‘qualified health plan coverage’’ means, 

7 with respect to residents of a State, health insurance 

8 coverage that meets applicable standards under 

9 State law, which standards need not be the same as 

10 that previously required of qualified health plans 

11 under title I of PPACA, and includes a high deduct12 ible health plan (as defined in section 223(c)(2) of 

13 the Internal Revenue Code of 1986) and includes 

14 coverage under a group health plan. 

15 (14) QUALIFIED RESIDENT.—The term ‘‘quali16 fied resident’’ means, with respect to a State for a 

17 month, an individual who is a resident of the State 

18 as of the first day of the month and is a citizen or 

19 national of the United States or otherwise lawfully 

20 residing in the State under color of law. 

21 (15) SECRETARY.—The term ‘‘Secretary’’ 

22 means the Secretary of Health and Human Services. 

23 (16) STATE.—The term ‘‘State’’ means the 50 

24 States and the District of Columbia. 


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1 (17) UNINSURED.—The term ‘‘uninsured’’ 

2 means, with respect to an individual, that the indi3 vidual does not have creditable coverage. 

4 Subtitle A—Insurance Reforms 

5 SEC. 101. STATE OPTIONS IN RESPONSE TO BURWELL DECI6 SION. 

7 (a) IN GENERAL.—Each State may elect, through 

8 written notice to the Secretary after the date of the enact9 ment of this Act and in accordance with this subtitle, one 

10 of the following three options in relation to the implemen11 tation of title I of the Patient Protection and Affordable 

12 Care Act after the decision of the Supreme Court in King 

13 v. Burwell: 

14 (1) CONTINUING IMPLEMENTATION OF PPACA, 

15 INCLUDING FEDERAL SUBSIDIES THROUGH A STATE16 ESTABLISHED EXCHANGE.—Under current law, the 

17 State establishing a health insurance Exchange 

18 under title I of PPACA, which thereby permits the 

19 continuation of Federal premium and cost-sharing 

20 subsidies for coverage offered through the Exchange 

21 as well as continuation of insurance and other re22 quirements under such title. 

23 (2) REJECTION OF PPACA, INCLUDING ELIMI24 NATION OF FEDERAL SUBSIDIES NOW PROVIDED

25 THROUGH FEDERALLY ESTABLISHED EXCHANGE.— 


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1 Under current law, the State not establishing such 

2 an Exchange, potentially resulting, post-Burwell, in 

3 the loss of such Federal premium and cost-sharing 

4 subsidies and the continued application of other re5 quirements under such title. 

6 (3) ESTABLISHING NEW STATE AND MARKET7 BASED ALTERNATIVE, WITH ALTERNATIVE PER CAP8 ITA FEDERAL DEPOSIT SYSTEM.—The State imple9 menting the alternative option described in section 

10 102, which includes— 

11 (A) the waiver of most requirements im12 posed under such title; and 

13 (B) the provision of a new, HSA- and mar14 ket-based deposit system for individuals who do 

15 not otherwise qualify for Federal or State sub16 sidies for health benefits coverage. 

17 If a State fails to make an election described in this sub18 section, the State shall be deemed to have made the elec19 tion described in paragraph (2). A State may, through 

20 written notice to the Secretary, change an election pre21 viously made under this subsection. 

22 (b) RELATION TO CURRENT MEDICAID ACA COV23 ERAGE OPTION.—Nothing in this section shall be con24 strued to change the option of a State with respect to the 

25 implementation of Medicaid ACA coverage under section 


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1 1902(a)(10)(A)(i)(VIII) of the Social Security Act (42 

2 U.S.C. 1395a(a)(10)(A)(i)(VIII)), except that a State that 

3 elects not to provide medical assistance to individuals 

4 under such section may make such individuals deposit 

5 qualifying residents under this title. 

6 SEC. 102. STATE ALTERNATIVE OPTION. 

7 (a) IN GENERAL.—In the case of a State that elects 

8 under section 101(a)(3) the alternative option under this 

9 section, subject to subsection (d) and section 105, the fol10 lowing shall apply: 

11 (1) NO FEDERAL EXCHANGE.—The Federal 

12 Government shall not establish or maintain an Ex13 change in the State under title I of PPACA. 

14 (2) ELIMINATION OF INDIVIDUAL AND EM15 PLOYER SHARED RESPONSIBILITY FOR HEALTH

16 CARE TAX REQUIREMENTS FOR RESIDENTS AND EM17 PLOYEES IN STATE.—The individual and employer 

18 health care responsibilities under the amendments 

19 made by title I of PPACA (including under sections 

20 5000A and 4980H of the Internal Revenue Code of 

21 1986) shall no longer apply pursuant to section 106 

22 with respect to individuals who are residents of such 

23 State and with respect to individuals who are em24 ployed in such State, respectively. 


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1 (3) MODIFICATION OF INSURANCE REQUIRE2 MENTS.—Except as specifically provided in this title, 

3 the requirements under title I of PPACA (including 

4 amendments made by such title) relating to health 

5 insurance coverage offered in the State shall not 

6 apply except to the extent specified by the State. 

7 (4) NEW DEPOSIT SYSTEM THROUGH FUNDING

8 HSAS.— 

9 (A) IN GENERAL.—Deposit qualifying resi10 dents (as defined in subsection (b)(2)) who are 

11 residing in the State are eligible for a deposit 

12 to a health savings account that may be used 

13 for premiums and cost-sharing for health insur14 ance coverage in accordance with subsection 

15 (b). 

16 (B) STATE SPECIFICATION OF MANNER OF

17 CARRYING OUT HSA DEPOSIT SYSTEM (PATIENT18 GRANT ELECTING STATE).—In making the elec19 tion under this subsection, a State shall specify 

20 whether the State will carry out subsection (b) 

21 or if such subsection shall be carried out by 

22 means of the credit under section 36C of the 

23 Internal Revenue Code of 1986. 

24 (5) ADDITIONAL AMOUNTS FOR POPULATION

25 HEALTH INITIATIVES FOR STATE ADMINISTERED


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1 HSA DEPOSIT SYSTEM.—A patient-grant electing 

2 State (as defined in section 100(1)) is entitled to re3 ceive additional funding under subsection (c) for 

4 population health initiatives. 

5 (b) DEPOSIT THROUGH PAYMENT INTO HSA FOR

6 DEPOSIT QUALIFYING RESIDENTS.— 

7 (1) IN GENERAL.—The subsidies described in 

8 subsection (a)(4) for an electing State shall be fur9 nished for each deposit qualifying resident through 

10 the deposit of a contribution into an HSA of the in11 dividual in the amount determined under section 

12 103. 

13 (2) DEPOSIT QUALIFYING RESIDENT DE14 FINED.—In this title, the term ‘‘deposit qualifying 

15 resident’’ means, with respect to a State and a 

16 month, an individual— 

17 (A) who is a qualified resident (as defined 

18 in section 100(14)) of the State as of the first 

19 day of the month (or such other day in the 

20 month as the Secretary may specify); 

21 (B) with respect to whom an HSA has 

22 been established, which HSA may have been es23 tablished by the State in carrying out this sec24 tion; 


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1 (C) who is enrolled in qualified health plan 

2 coverage (as defined in section 100(13)), which 

3 enrollment may have been effected by the State 

4 in carrying out this section; and 

5 (D) who is not eligible for coverage under 

6 Medicare, is not enrolled for benefits under 

7 Medicaid or CHIP, and is not enrolled for bene8 fits under chapter 55 of title 10, United States 

9 Code (relating to TRICARE), or title 39 of 

10 such Code (relating to veterans’ benefits) or 

11 chapter 89 of title 5 of such Code (relating to 

12 the Federal Employees Health Benefits Pro13 gram). 

14 (3) PAYMENT ADMINISTRATION.— 

15 (A) STATE.—In the case of an electing 

16 State that elects to carry out this subsection 

17 through the State, the Secretary shall provide 

18 for payment to the State in amounts and in a 

19 time and manner sufficient to permit the State 

20 to make timely monthly contributions to HSAs 

21 under this subsection. The Secretary may pro22 vide for payment to the State using the pay23 ment methodology described in subsection (d) of 

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1 plied without regard to any State matching re2 quirement) and may condition such payments 

3 upon the provision of such information as the 

4 Secretary may require to ensure the proper pay5 ments under this subsection. As a condition of 

6 receiving payment under this section, a State 

7 shall submit such information, in such form, 

8 and manner, as the Secretary shall specify, in9 cluding information necessary to make the com10 putations of amounts under this section. 

11 (B) FEDERAL.—In the case of a State 

12 electing to carry out this subsection other than 

13 through the State, subsidies described in sub14 section (a)(4) shall be provided through a re15 fundable tax credit under section 36C of the In16 ternal Revenue Code of 1986. 

17 (4) CONSTRUCTION.—Nothing in this sub18 section shall be construed— 

19 (A) to prevent an individual from affirma20 tively electing not to have an HSA established 

21 on the individual’s behalf and not to be enrolled 

22 under health insurance coverage; 

23 (B) subject to subparagraph (A), to pre24 vent a State from establishing an HSA for each 


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1 deposit qualifying resident who does not other2 wise have an HSA; 

3 (C) subject to subparagraph (A), to pre4 vent a State from establishing a mechanism 

5 whereby individuals who would be deposit quali6 fying residents but for paragraph (2)(C) are en7 rolled under health insurance coverage; and 

8 (D) to prevent a State from changing its 

9 State Medicaid plan to eliminate coverage under 

10 section 1902(a)(10)(A)(i)(VIII) of the Social 

11 Security Act (42 U.S.C. 

12 1396a(a)(10)(A)(i)(VIII)), in order that indi13 viduals otherwise covered under such section 

14 may qualify for subsidies under this section. 

15 (c) POPULATION HEALTH INITIATIVE FUNDING.— 

16 (1) IN GENERAL.—In the case of an electing 

17 State for a year, the State is entitled to receive pay18 ment from the Secretary of Health and Human 

19 Services after the end of such year in an amount 

20 equal to 2 percent of the actual aggregate amount 

21 deposited under subsection (b) into HSAs for resi22 dents of the State for the year. 

23 (2) USE OF FUNDS.—Amounts paid to a State 

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1 lation health initiatives (as defined by the Sec2 retary). 

3 (3) ENTITLEMENT.—Paragraph (1) constitutes 

4 budget authority in advance of appropriations Acts 

5 and represents the obligation of the Federal Govern6 ment to provide for the payment to States of 

7 amounts provided under such paragraph. 

8 (d) REQUIRING RULES FOR COMPUTING USUAL, 

9 CUSTOMARY, AND REASONABLE (UCR) PRICES.—As a 

10 condition for a State’s election of the alternative option 

11 under this section, the State must provide, through its de12 partment of insurance or equivalent agency, for establish13 ment of rules to carry out section 1867(j)(1)(A)(ii) of the 

14 Social Security Act, as added by section 121(a)(2). 

15 SEC. 103. COMPUTATION OF MONTHLY HSA DEPOSIT 

16 AMOUNT FOR DEPOSIT QUALIFYING RESI17 DENTS. 

18 (a) COMPUTATION.— 

19 (1) IN GENERAL.—The Secretary shall develop 

20 a standardized methodology to determine consistent 

21 with this section a monthly HSA deposit amount for 

22 deposit qualifying residents in each State for months 

23 in each year. Subject to paragraphs (3) and (4), 

such amount shall be equal to 1 24 ⁄12 of the average per 

25 capita annual amount computed under subsection 


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1 (b) for the State for the year, as adjusted for the 

2 deposit qualifying resident involved— 

3 (A) for age and geographic area under 

4 subsection (c); and 

5 (B) for income under subsection (d). 

6 (2) NO VARIATION BASED ON HOW DEPOSIT

7 AMOUNT DISTRIBUTED.—Such amount shall be the 

8 same for a deposit qualifying individual without re9 gard to whether the contribution to the individual’s 

10 HSA is made by a State under this section or by the 

11 Federal Government through the operation of sec12 tion 36C of the Internal Revenue Code of 1986. 

13 (3) PATIENT-GRANT ELECTING STATE HAS

14 FLEXIBILITY TO MAINTAIN LEVEL OF BENEFITS FOR

15 CURRENT ACA BENEFICIARIES.—A patient-grant 

16 electing State may elect to increase the amount of 

17 the deposit for all deposit qualifying individuals 

18 under this section to the amounts that the Secretary 

19 estimates would have been paid with respect to such 

20 individuals under section 36B of the Internal Rev21 enue Code of 1986 and section 1402 of PPACA if 

22 those sections had remained in effect in the State 

23 with respect to such individuals. Such election shall 

24 be made for a year and shall continue from year to 

25 year until the State elects to terminate such election. 


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1 (4) SPECIAL RULE FOR PARTIAL DEPOSIT FOR

2 LOW-INCOME INDIVIDUALS WITH EMPLOYER-SPON3 SORED INSURANCE (ESI).—In the case of an indi4 vidual who is covered under a group health plan and 

5 with respect to such coverage there is a contribution 

6 by an employer which is excluded from the individ7 ual’s gross income under the Internal Revenue Code 

8 of 1986, insofar as the individual is a deposit quali9 fying resident, the amount of the deposit with re10 spect to the individual shall be reduced, in a manner 

11 specified by the Secretary in consultation with the 

12 Secretary of the Treasury and taking into account 

13 the income of the individual’s household, by an 

14 amount that is approximately equivalent to the esti15 mated amount of the reduction in the amount of in16 come tax resulting from such exclusion (and any re17 duction in taxes imposed by chapter 21 or chapter 

18 2 of such Code by reason of any exclusion of such 

19 contributions from wages and self employment in20 come). 

21 (b) COMPUTATION OF UNADJUSTED PER CAPITA.— 

22 (1) FOR STATES THAT CONTINUE PPACA MED23 ICAID COVERAGE.— 

24 (A) IN GENERAL.—In the case of a State 

25 that provides medical assistance under section 


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1 1902(a)(10)(A)(i)(VIII) of the Social Security 

2 Act (42 U.S.C. 1396b(a)(10)(A)(i)(VIII)) dur3 ing a year, subject to paragraphs (3) and (4), 

4 the Secretary shall compute an average per cap5 ita annual amount for the State for the year 

6 equal to— 

7 (i) the amount specified in subpara8 graph (B), divided by 

9 (ii) the average monthly number of 

10 deposit qualifying residents of the State in 

11 the year. 

12 (B) AMOUNT BASED ON PPACA PROJECTED

13 FEDERAL EXPENDITURES.—The amount speci14 fied in this subparagraph for a State for a year 

15 is 95 percent of the Secretary’s estimate of the 

16 total payments that would have been made (as17 suming the existence of a State established Ex18 change in the State) under section 36B of the 

19 Internal Revenue Code of 1986 and under sec20 tion 1402 of PPACA with respect to all quali21 fied residents in the State in the year (or tax22 able year ending with such year, if applicable). 

23 (2) FOR STATES THAT DO NOT PROVIDE PPACA

24 MEDICAID COVERAGE.— 


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1 (A) IN GENERAL.—In the case of a State 

2 not described in paragraph (1) for a year, sub3 ject to paragraphs (3) and (4), the Secretary 

4 shall compute an average per capita annual 

5 amount for the State for the year equal to— 

6 (i) the amount specified in subpara7 graph (B) for the State and year, divided 

8 by 

9 (ii) the average monthly number of 

10 deposit qualifying residents of the State in 

11 the year. 

12 (B) AMOUNT BASED ON PPACA AND MED13 ICAID PROJECTED FEDERAL EXPENDITURES.— 

14 The amount specified in this subparagraph for 

15 a State for a year is equal to the sum of— 

16 (i) 95 percent of the Secretary’s esti17 mate of the total payments that would 

18 have been made (assuming the existence of 

19 a State-established Exchange in the State) 

20 under section 36B of the Internal Revenue 

21 Code of 1986 and under section 1402 of 

22 PPACA with respect to all qualified resi23 dents in the year (or taxable year ending 

24 with such year, if applicable); and 


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1 (ii) the Secretary’s estimate of the 

2 total payments that would have been made 

3 to the State under title XIX of the Social 

4 Security Act for individuals eligible to be 

5 covered under section 

6 1902(a)(10)(A)(i)(VIII) of the Social Secu7 rity Act assuming the election of a State to 

8 provide Medicaid coverage under such sec9 tion and assuming the applicable Federal 

10 medical assistance percentage were 95 per11 cent with respect to such individuals. 

12 (3) BUDGET NEUTRAL ADJUSTMENT IN PAY13 MENTS TO TAKE INTO ACCOUNT ELECTION OF HIGH14 ER DEPOSITS TO MAINTAIN ACA SUBSIDY LEVELS.— 

15 If a State makes the election described in subsection 

16 (a)(3) with respect to providing higher deposit 

17 amounts for certain individuals described in such 

18 subsection, then the Secretary shall adjust the aver19 age per capita annual amount under paragraph (1) 

20 or (2), as applicable to the State, by— 

21 (A) reducing the amount described in 

22 paragraph (1)(B) (or, if applicable, paragraph 

23 (2)(B)(i)) by an amount equal to 95 percent of 

24 the aggregate increased deposit level attrib25 utable to subsection (a)(3); and 


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1 (B) not counting such an individual as a 

2 qualifying resident for purposes of paragraph 

3 (1)(A)(ii) (or, if applicable, paragraph 

4 (2)(A)(ii)). 

5 (4) ADJUSTMENT FOR COSTS OF PARTIAL DE6 POSITS FOR LOW-INCOME ESI INDIVIDUALS.—The 

7 Secretary shall adjust the average per capita annual 

8 amount under paragraph (1) or (2), as applicable to 

9 the State, by— 

10 (A) reducing the amount described in 

11 paragraph (1)(B) (or, if applicable, paragraph 

12 (2)(B)(i)) by an amount equal to 95 percent of 

13 the amount of payments under this section that 

14 are attributable to individuals described in sub15 section (a)(4); and 

16 (B) not counting any individual described 

17 in subsection (a)(4) as a qualifying resident for 

18 purposes of paragraph (1)(A)(ii) (or, if applica19 ble, paragraph (2)(A)(ii)). 

20 (c) ADJUSTMENT FOR AGE, GEOGRAPHIC AREA, AND

21 INCOME DISTRIBUTION WITHIN STATE.— 

22 (1) IN GENERAL.—The Secretary shall apply 

23 such adjustments to the per capita amount com24 puted under subsection (b) as is designed to take 

25 into account, in a budget neutral manner and based 


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1 on the costs estimated under paragraph (2), actu2 arial differences in health care costs attributable to 

3 individuals in different age categories and different 

4 geographic locations of primary residences in the 

5 State and the reductions based on income under 

6 subsection (d). No such adjustment shall be made 

7 based on sex. 

8 (2) DATA ON AVERAGE COSTS OF SERVICES.— 

9 Not later than December 15 before the beginning of 

10 each year, the Agency for Healthcare Research and 

11 Quality shall estimate the average cost of health 

12 care for such year for individuals under 65 years of 

13 age and may estimate how such average varies for 

14 different populations of individuals under age 65. 

15 The adjustments under paragraph (1) for age cat16 egories for a year shall be based on such estimates 

17 made. Not later than such date, the Secretary shall 

18 prescribe tables for purposes of making adjustments 

19 based on age under paragraph (1) based on such de20 termination which shall apply for taxable years be21 ginning in the succeeding calendar year. 

22 (d) INCOME-RELATED PHASE-OUT.— 

23 (1) IN GENERAL.—The per capita amount as 

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1 section (c) shall be multiplied by a phase-out per2 centage equal to 100 percent reduced by 1 percent3 age point for each $1,000 (or fraction thereof) by 

4 which the taxpayer’s modified adjusted gross income 

5 for the taxable year exceeds $90,000 (or, in the case 

6 of a joint return, $150,000), multiplied, for a tax7 able year ending in a year beginning after December 

8 31, 2015, by the cost-of-living adjustment for the 

9 year as described in section 1(f)(3) of the Internal 

10 Revenue Code of 1986, but substituting ‘‘2015’’ for 

11 ‘‘1992’’ in subparagraph (B) of such section. 

12 (2) ZERO PER CAPITA AMOUNT FOR MARRIED

13 FILING SEPARATELY.—The per capita amount under 

14 this section shall be zero in the case of a married 

15 couple filing separately. 

16 SEC. 104. STATE OPTIONS FOR IMPROVED ACCESS TO 

17 HEALTH INSURANCE COVERAGE IN EACH 

18 STATE. 

19 (a) STATE OPTIONS TO IMPROVE ACCESS.— 

20 (1) IN GENERAL.—Each State may carry out 

21 any of the functions described in succeeding sub22 sections in order to improve the access of residents 

23 of the State to health insurance coverage. 

24 (2) REPURPOSING STATE EXCHANGES.—A 

25 State may use or adapt an Exchange that the State 


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1 has established under title I of PPACA to carry out 

2 the any of such functions. 

3 (3) REPURPOSING FEDERAL EXCHANGE.—The 

4 Federal Government shall make available to States 

5 current capabilities of the Federal Exchange, includ6 ing the Federal Data Services Hub and Agent 

7 Broker Portal, to the extent requested by a State for 

8 activities related to enrollment of citizens of the 

9 State into health insurance coverage. 

10 (b) TRANSPARENCY PORTAL.—Each State may es11 tablish and operate an open and transparent marketplace 

12 mechanism whereby qualified residents of the State can 

13 readily compare, through the use of the Internet, the bene14 fits and prices between different health insurance coverage 

15 options made available to them. 

16 (c) ENROLLMENT, SUBJECT TO INDIVIDUAL OPT17 OUT.— 

18 (1) IN GENERAL.—Subject to paragraph (2), a 

19 State may provide for the enrollment of qualified 

20 residents of the State who are uninsured in default 

21 health insurance coverage offered under section 

22 105(c) and establishing an HSA for such residents 

23 who do not have an HSA unless the resident has af24 firmatively elected not to be so enrolled and not to 

25 have an HSA, respectively. Any such enrollment 


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1 under this paragraph shall be coordinated with the 

2 annual open enrollment periods provided under sec3 tion 105(b). 

4 (2) SIMPLE PROCESS FOR INDIVIDUALS TO OPT5 OUT.—As a condition of a State providing for the 

6 enrollment function described in paragraph (1), the 

7 State must establish an easy-to-use and transparent 

8 means by which individuals may elect not to be en9 rolled in default health insurance coverage or to 

10 have an HSA established on the individual’s behalf, 

11 or both. 

12 (d) RISK MITIGATION MECHANISMS AND REINSUR13 ANCE AND RISK-CORRIDOR PROGRAMS.— 

14 (1) IN GENERAL.—Notwithstanding any other 

15 provision of this title or section 223(c)(2) of the In16 ternal Revenue Code of 1986, a State may estab17 lish— 

18 (A) mechanisms for risk mitigation or risk 

19 adjustment in order to limit volatility in the 

20 premiums based on health experience to class21 average premiums; and 

22 (B) a reinsurance and risk-corridor pro23 gram that involves no Federal funds with re24 spect to coverage both in the individual market 

25 and in the small group market. 


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1 (2) BASIS FOR RISK ADJUSTMENT.—Mecha2 nisms and programs under paragraph (1) may be 

3 based on the health status score of each individual 

4 enrolled in health insurance coverage in the indi5 vidual market and not solely based on the aggregate 

6 risk of the risk pool with respect to each plan of 

7 health insurance coverage. 

8 SEC. 105. EXPANDED ACCESS AND PATIENT PROTECTIONS. 

9 (a) IN GENERAL.—As a condition for the election of 

10 the alternative option under section 102 in a State, the 

11 State must meet the requirements of this section. 

12 (b) ANNUAL AND OTHER OPEN ENROLLMENT PERI13 ODS.— 

14 (1) IN GENERAL.—The State shall require, in 

15 connection with the offering of health insurance cov16 erage in the individual market in the State, that 

17 there are uniform annual and other open enrollment 

18 periods (such as those for changes in life events, 

19 changes in State residency, and involuntary changes 

20 in eligibility for coverage under a group health plan) 

21 in order to permit qualified residents to enroll in 

22 qualified health plan coverage in a manner that pro23 motes continuity of coverage. Such periods shall be 

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1 lished under title I of PPACA, as in effect before the 

2 date of the enactment of this Act. 

3 (2) INITIAL OPEN ENROLLMENT PERIOD.—In 

4 addition, the State shall establish an initial open en5 rollment period during which qualified residents may 

6 enroll in qualified health plan coverage without the 

7 imposition of any underwriting described in sub8 section (d)(1)(B). Such period shall be a period of 

9 not less than 45 days and shall provide for enroll10 ment to become effective on January 1 of the year 

11 specified by the State in which such State election 

12 first becomes effective. 

13 (c) OFFERING OF DEFAULT HEALTH INSURANCE

14 COVERAGE.— 

15 (1) IN GENERAL.—The State shall provide for 

16 the offering, through one or more contracts with one 

17 or more health insurance issuers in the State, of de18 fault health insurance coverage (as defined in para19 graph (2)) to qualified residents of the State who 

20 are otherwise uninsured. Such default coverage shall 

21 be made available on a continuous basis during a 

22 year. Failure of a qualified resident to enroll in such 

23 default coverage or other creditable coverage during 

24 a year results in adverse consequences described in 

25 subsection (d)(1)(B) to the resident. 


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1 (2) DEFAULT HEALTH INSURANCE PLAN DE2 FINED.—In this title, the term ‘‘default health in3 surance plan’’ means, with respect to a State, health 

4 insurance coverage that— 

5 (A) is a high deductible health plan (within 

6 the meaning of section 223(c)(2) of the Internal 

7 Revenue Code of 1986) with prescription drug 

8 coverage limited to generic drugs for a limited 

9 number of chronic conditions (commonly re10 ferred to as tier I pharmacy benefit); 

11 (B) meets such requirements as may apply 

12 to qualify for the payment of plan premiums 

13 from a health savings account under section 

14 223 of such Code (such as age-related pre15 miums and limitation on imposition of pre16 existing condition exclusions); 

17 (C) has a provider network for covered 

18 benefits that is adequate (as determined con19 sistent with guidelines issued by the Secretary) 

20 to ensure access to health benefits under such 

21 plan; 

22 (D) provides for coverage of childhood im23 munizations without cost sharing requirements 

24 to the extent such immunizations have in effect 

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1 mittee on Immunization Practices of the Cen2 ters for Disease Control and Prevention with 

3 respect to the individual involved; and 

4 (E) meets such other requirements as the 

5 State may specify. 

6 (d) CONSEQUENCES RESPECTING CONTINUOUS COV7 ERAGE.— 

8 (1) CONSEQUENCES FOR NOT MAINTAINING

9 CONTINUOUS COVERAGE.— 

10 (A) AVOIDANCE OF CONSEQUENCES BY

11 MAINTAINING CONTINUOUS COVERAGE.—All 

12 qualified residents of a State are eligible during 

13 the initial open enrollment period provided 

14 under subsection (b)(2) to enroll in qualified 

15 health plan coverage and, thereafter, to main16 tain continuous coverage in order to avoid the 

17 adverse consequences described in the suc18 ceeding provisions of this paragraph. 

19 (B) UNDERWRITING PERMITTED.—In the 

20 case of a qualified resident of the State who 

21 fails to maintain continuous creditable coverage 

22 (not including any breaks in coverage of less 

23 than 63 days), the State shall— 

24 (i) permit health insurance issuers for 

25 the period specified in subparagraph (C) to 


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1 medically underwrite (through denial of 

2 health insurance coverage, application of 

3 preexisting condition limitations, differen4 tial premiums, or otherwise) the issuance 

5 of health insurance coverage, other than 

6 with respect to the issuance of default 

7 health insurance coverage under subsection 

8 (c); and 

9 (ii) require health insurance issuers, 

10 during the subsequent 2-year period in the 

11 case of issuance of health insurance cov12 erage other than such default health insur13 ance coverage, to impose a monthly late 

14 enrollment penalty in the amount specified 

15 in subparagraph (D)(i) and to remit the 

16 amount of such penalty collected to the 

17 Federal Treasury in accordance with sub18 paragraph (D)(ii). 

19 (C) PERIOD FOR APPLICATION OF UNDER20 WRITING.—For purposes of subparagraph 

21 (B)(i), the period specified in this subparagraph 

22 is, with respect to an uninsured individual as of 

23 a date, a period (not to exceed 18 months) 

24 equivalent to number of months in the previous 

25 18-month period in which the individual did not 


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1 have continuous creditable coverage described in 

2 subparagraph (B). 

3 (D) MONTHLY LATE ENROLLMENT PEN4 ALTY AMOUNT.— 

5 (i) IN GENERAL.—The monthly late 

6 enrollment penalty amount specified in this 

7 clause for a month is equal to the lesser of 

8 10 percent or the product of— 

9 (I) 1 percent of the monthly pre10 mium amount for default health in11 surance coverage with respect to the 

12 individual and month; and 

13 (II) the number of months dur14 ing the 2-year period (preceding the 

15 18-month period described in subpara16 graph (B)(i)) in which the resident 

17 failed to maintain the continuous cov18 erage described in paragraph (1)(D). 

19 (ii) PAYMENT OF PENALTY AMOUNT

20 TO FEDERAL TREASURY.—The amount of 

21 the monthly late enrollment penalty col22 lected under this subparagraph shall be 

23 paid to the Treasury of the United States 

24 in a form and manner specified by the Sec25 retary of the Treasury. 


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1 (2) CHANGES IN ENROLLMENT PERMITTED

2 WITHOUT MEDICAL UNDERWRITING DURING ANNUAL

3 OPEN ENROLLMENT PERIODS FOR THOSE MAINTAIN4 ING CONTINUOUS COVERAGE.— 

5 (A) DURING SECOND OPEN ENROLLMENT

6 PERIOD.—In the case of a qualified resident 

7 who maintains continuous coverage (not includ8 ing any breaks in coverage of less than 63 

9 days) during the period after the initial open 

10 enrollment period under subsection (b)(2) and 

11 through the second annual open enrollment pe12 riod established by the State consistent with 

13 subsection (b)(1), the State shall require health 

14 insurance issuers to permit such residents dur15 ing such second annual open enrollment period 

16 to change the qualified health plan coverage in 

17 which the individual is enrolled without medical 

18 underwriting. 

19 (B) DURING THIRD AND SUBSEQUENT

20 OPEN ENROLLMENT PERIODS.—In the case of a 

21 qualified resident who maintains continuous 

22 coverage for a period of 18 months or longer 

23 (not including any breaks in coverage of less 

24 than 63 days) as of the initial date of a third 

25 or subsequent annual open enrollment period 


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1 established by the State under subsection 

2 (b)(1), the State shall require health insurance 

3 issuers to permit such residents during such an 

4 open enrollment period to change the qualified 

5 health plan coverage in which the individual is 

6 enrolled without medical underwriting. 

7 SEC. 106. SUNSETTING CERTAIN ACA PROVISIONS; CON8 TINUATION OF POLICIES OF COVERING 

9 ADULT CHILDREN AND NOT APPLYING LIFE10 TIME OR ANNUAL LIMITS. 

11 (a) IN GENERAL.—Subject to subsections (b) and (c), 

12 title I of the Patient Protection and Affordable Care Act 

13 (including the amendments made by such title) shall not 

14 apply (and the provisions of law amended by such title 

15 are restored as if such title had not been enacted) in the 

16 case of any State that does not have in effect the election 

17 described in section 101(a)(1). 

18 (b) CONTINUATION OF POLICIES FOR EXTENSION OF

19 DEPENDENT COVERAGE FOR ADULT CHILDREN AND

20 PROHIBITION OF LIFETIME AND ANNUAL COVERAGE

21 LIMITS.—Subsection (a) shall not apply with respect to 

22 the following: 

23 (1) Section 2711 of the Public Health Service 

24 Act (relating to no lifetime or annual limits). 


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1 (2) Section 2714 of such Act (relating to exten2 sion of dependent coverage). 

3 (c) CONTINUATION OF POLICIES FOR CERTAIN

4 STATES OPERATING EXCHANGES.—Subsection (a) shall 

5 not apply with respect to health insurance coverage in a 

6 State that has in effect the election described in section 

7 101(a)(1). 

8 Subtitle B—Medicaid 

9 SEC. 111. APPLICATION OF HEALTH SAVINGS ACCOUNTS IN 

10 RELATION TO MEDICAID. 

11 (a) IN GENERAL.—Title XIX of the Social Security 

12 Act (42 U.S.C. 1396 et seq.) is amended by adding at 

13 the end the following new section: 

14 ‘‘SEC. 1947. PROVISIONS RELATING TO HEALTH SAVINGS 

15 ACCOUNTS. 

16 ‘‘(a) DISREGARDING HSA IN DETERMINING ASSETS

17 AND INCOME FOR MEDICAID ELIGIBILITY DETERMINA18 TIONS OTHER THAN FOR LONG-TERM CARE SERVICES.— 

19 The assets in a health savings account under section 223 

20 of the Internal Revenue Code of 1986, and any income 

21 from such assets in such account, shall be disregarded for 

22 purposes of determining eligibility and amount of medical 

23 assistance under this title, other than for purposes of de24 termining eligibility and the amount of medical assistance 


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1 for long-term care services (described in section 

2 1917(c)(1)(C)(i)). 

3 ‘‘(b) NOTIFICATIONS OF TREASURY OF MEDICAID

4 ELIGIBILITY.—In order to meet the requirements of this 

5 subsection (for purposes of section 1902(a)(78)), a State 

6 shall provide such notice to the Secretary of the Treasury, 

7 in such form and manner as such Secretary shall specify, 

8 as may be necessary to identify individuals who are eligible 

9 for, and receiving, medical assistance under this title in 

10 a month in order to carry out section 223 of the Internal 

11 Revenue Code of 1986.’’. 

12 (b) IMPLEMENTATION OF NOTIFICATION REQUIRE13 MENT THROUGH STATE PLAN.—Section 1902(a) of the 

14 Social Security Act (42 U.S.C. 1396a(a)) is amended by 

15 inserting after paragraph (77) the following new para16 graph: 

17 ‘‘(78) provide for notice in accordance with sec18 tion 1947(b) to the Secretary of the Treasury of the 

19 identity of individuals who are determined eligible 

20 for (and receiving) medical assistance under this 

21 title;’’. 

22 (c) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to eligibility determinations with 

24 respect to medical assistance for periods beginning on or 

25 after January 1, 2016. 


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1 Subtitle C—Provider Price 

2 Transparency 

3 SEC. 121. ENSURING ACCESS TO EMERGENCY SERVICES 

4 WITHOUT EXCESSIVE CHARGES FOR OUT-OF5 NETWORK SERVICES. 

6 (a) IN GENERAL.—Section 1867 of the Social Secu7 rity Act (42 U.S.C. 1395dd) is amended— 

8 (1) in subsection (d), by adding at the end the 

9 following new paragraph: 

10 ‘‘(5) ENFORCEMENT WITH RESPECT TO EXCES11 SIVE CHARGES.—A hospital, physician, or other enti12 ty that violates the requirements of subsection (j)(1) 

13 with respect to the furnishing of items and services 

14 is subject to a civil money penalty of not more than 

15 $25,000 for each such violation. The provisions of 

16 section 1128A (other than subsections (a) and (b)) 

17 shall apply to a civil money penalty under this para18 graph in the same manner as such provisions apply 

19 with respect to a penalty or proceeding under section 

20 1128A(a).’’; and 

21 (2) by adding at the end the following new sub22 section: 

23 ‘‘(j) PROTECTIONS AGAINST EXCESSIVE OUT-OF24 NETWORK CHARGES FOR EMERGENCY SERVICES.— 


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1 ‘‘(1) IN GENERAL.—If items or services to 

2 screen or treat an emergency medical condition are 

3 furnished under this section in a participating hos4 pital with respect to an individual and the individual 

5 has not, directly or through a health insurance 

6 issuer, group health plan, or other third party, nego7 tiated a payment rate for such items and services, 

8 subject to paragraph (2), the charges imposed for 

9 such items and services may not be in excess of the 

10 following: 

11 ‘‘(A) PHYSICIANS’ AND OTHER PROFES12 SIONAL SERVICES.—For physicians’ services or 

13 services of a health care provider to which sec14 tion 223(e)(9) of the Internal Revenue Code of 

15 1986 applies (and including drugs and 

16 biologicals furnished in conjunction with and 

17 billed as part of such services), the lesser of— 

18 ‘‘(i) the cash price for such services 

19 posted pursuant to such section; or 

20 ‘‘(ii) 85 percent of the usual, cus21 tomary, and reasonable (UCR) charge for 

22 such services, as determined under rules 

23 established by the department of insurance 

24 for the State in which the services are fur25 nished. 


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1 ‘‘(B) HOSPITAL SERVICES.—For inpatient 

2 and outpatient hospital services for which pay3 ment rates are established under this title (and 

4 including drugs and biologicals furnished in 

5 conjunction with and billed as part of such 

6 services), the lesser of— 

7 ‘‘(i) the cash price for such services 

8 posted pursuant to section 223(e)(9) of the 

9 Internal Revenue Code of 1986; or 

10 ‘‘(ii) 110 percent of the payment rate 

11 applicable to such services in the case of 

12 an individual entitled to benefits under 

13 part A and enrolled under part B. 

14 ‘‘(C) DRUGS AND BIOLOGICALS.—For 

15 drugs and other pharmaceuticals furnished to 

16 which a previous subparagraph does not apply, 

17 the lesser of— 

18 ‘‘(i) twice the acquisition cost to the 

19 hospital or other provider for the dose in20 volved; or 

21 ‘‘(ii) the acquisition cost to the hos22 pital or other provider plus $250. 

23 The dollar amount in clause (ii) shall be in24 creased from year to year (beginning with the 

25 year after the first year in which this subsection 


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1 applies) by the same percentage as the percent2 age increase in the consumer price index for all 

3 urban consumers (all items; U.S. city average) 

4 for the year involved (as determined by the Sec5 retary). Any such dollar amount as so increased 

6 that is not a multiple of $5 shall be rounded to 

7 the nearest multiple of $5 (or, if a multiple of 

8 $2.50, to the next highest multiple of $5). 

9 ‘‘(D) OTHER ITEMS AND SERVICES.—For 

10 any other items or services, the lesser of— 

11 ‘‘(i) the cash price for such items and 

12 services posted pursuant to section 

13 223(e)(9) of the Internal Revenue Code of 

14 1986; or 

15 ‘‘(ii) 110 percent of the payment basis 

16 that would be applicable to payment for 

17 such items and services under this title in 

18 the case of an individual entitled to bene19 fits under part A and enrolled under part 

20 B. 

21 ‘‘(2) SPECIAL RULE FOR ITEMS AND SERVICES

22 FURNISHED AS A BUNDLE.—In the case of items 

23 and services for which there is a single price for a 

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1 imum charge permitted under paragraph (1) may 

2 not exceed the lesser of— 

3 ‘‘(A) the price charged for such bundled 

4 services; or 

5 ‘‘(B) the aggregate of the maximum 

6 charges permitted under paragraph (1) with re7 spect to items and services included in such 

8 bundle.’’. 

9 (b) REFERENCE TO PRICE DISCLOSURE PROVI10 SION.—For requirements relating to the posting of health 

11 care prices on the Internet, see section 223(e)(9) of the 

12 Internal Revenue Code of 1986, as added by section 

13 204(a). 

14 (c) EFFECTIVE DATE.—The amendments made by 

15 this section shall apply to charges imposed for items and 

16 services furnished on or after January 1, 2016. 

17 TITLE II—REFORM OF TAX PRO18 VISIONS RELATING TO 

19 HEALTH CARE 

20 Subtitle A—Promotion of Health 

21 Savings Accounts 

22 SEC. 201. REPEAL OF HIGH DEDUCTIBLE HEALTH PLAN RE23 QUIREMENT. 

24 (a) IN GENERAL.—Section 223(a) of the Internal 

25 Revenue Code of 1986 is amended to read as follows: 


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1 ‘‘(a) DEDUCTION ALLOWED.—In the case of an indi2 vidual, there shall be allowed as a deduction for a taxable 

3 year an amount equal to the aggregate amount paid in 

4 cash during such taxable year by or on behalf of such indi5 vidual to a health savings account of such individual.’’. 

6 (b) CONFORMING AMENDMENTS.— 

7 (1) Section 223(b)(1) of such Code is amended 

8 by striking ‘‘that the individual is an eligible indi9 vidual’’. 

10 (2) Section 223(b)(2) of such Code is amended 

11 by striking ‘‘under a high deductible health plan’’ 

12 each place it appears. 

13 (3) Section 223(b) of such Code is amended by 

14 striking paragraph (8). 

15 (4) Section 223 of such Code is amended by 

16 striking subsection (c) and redesignating subsections 

17 (d) through (h) as subsections (c) through (g), re18 spectively. 

19 (5) Section 223(c)(1)(A) of such Code, as re20 designated by this Act, is amended by striking ‘‘sub21 section (f)(5)’’ and inserting ‘‘subsection (e)(5)’’. 

22 (6) Section 223(f)(1) of such Code, as redesig23 nated by this Act, is amended— 

24 (A) by striking ‘‘subsections (b)(2) and 

25 (c)(2)(A)’’ and inserting ‘‘subsection (b)(2)’’, 


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1 (B) by striking ‘‘subparagraph (B) there2 of—’’ and all that follows through the end of 

3 subparagraph (B) and inserting ‘‘subparagraph 

4 (B) thereof ‘calendar year 1997’.’’, and 

5 (C) by striking ‘‘amounts under sub6 sections (b)(2) and (c)(2)(A)’’ in the second 

7 sentence and inserting ‘‘amounts under sub8 section (b)(2)’’. 

9 (7) Section 26(b)(2)(U) of such Code is amend10 ed by striking ‘‘section 223(f)(4)’’ and inserting 

11 ‘‘section 223(e)(4)’’. 

12 (8) Sections 35(g)(3), 220(f)(5)(A), 

13 848(e)(1)(B)(v), 4973(a)(5), and 6051(a)(12) of 

14 such Code are each amended by striking ‘‘section 

15 223(d)’’ each place it appears and inserting ‘‘section 

16 223(c)’’. 

17 (9) Section 106(d)(1) of such Code is amend18 ed— 

19 (A) by striking ‘‘who is an eligible indi20 vidual (as defined in section 223(c)(1))’’, and 

21 (B) by striking ‘‘section 223(d)’’ and in22 serting ‘‘section 223(c)’’. 

23 (10) Section 408(d)(9) of such Code is amend24 ed— 


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1 (A) in subparagraph (A) by striking ‘‘who 

2 is an eligible individual (as defined in section 

3 223(c)) and’’, and 

4 (B) in subparagraph (C) by striking ‘‘com5 puted on the basis of the type of coverage under 

6 the high deductible health plan covering the in7 dividual at the time of the qualified HSA fund8 ing distribution’’. 

9 (11) Section 877A(g)(6) of such Code is 

10 amended by striking ‘‘223(f)(4)’’ and inserting 

11 ‘‘223(e)(4)’’. 

12 (12) Section 4973(g) of such Code is amend13 ed— 

14 (A) by striking ‘‘section 223(d)’’ and in15 serting ‘‘section 223(c)’’, 

16 (B) by striking ‘‘223(f)(5)’’ in paragraph 

17 (1) and inserting ‘‘223(e)(5)’’, 

18 (C) by striking ‘‘section 223(f)(2)’’ in 

19 paragraph (2) and inserting ‘‘section 

20 223(e)(2)’’, and 

21 (D) by striking ‘‘section 223(f)(3)’’ in the 

22 second sentence and inserting ‘‘section 

23 223(e)(3)’’. 

24 (13) Section 4975 of such Code is amended— 

25 (A) in subsection (c)(6)— 


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1 (i) by striking ‘‘section 223(d)’’ and 

2 inserting ‘‘section 223(c)’’, and 

3 (ii) by striking ‘‘section 223(e)(2)’’ 

4 and inserting ‘‘section 223(d)(2)’’, and 

5 (B) in subsection (e)(1)(E), by striking 

6 ‘‘section 223(d)’’ and inserting ‘‘section 

7 223(c)’’. 

8 (14) Section 6693(a)(2)(C) of such Code is 

9 amended by striking ‘‘section 223(h)’’ and inserting 

10 ‘‘section 223(g)’’. 

11 (c) EFFECTIVE DATE.—The amendments made by 

12 this section shall apply to taxable years beginning after 

13 December 31, 2015. 

14 SEC. 202. TREATMENT OF HSA AFTER DEATH OF ACCOUNT 

15 BENEFICIARY. 

16 (a) IN GENERAL.—Section 223(e)(8) of the Internal 

17 Revenue Code of 1986, as redesignated by section 

18 201(c)(3) of this Act, is amended to read as follows: 

19 ‘‘(8) TREATMENT AFTER DEATH OF ACCOUNT

20 BENEFICIARY.—If an individual acquires an account 

21 beneficiary’s interest in a health savings account by 

22 reason of the death of the account beneficiary, such 

23 health savings account shall be treated as if the indi24 vidual were the account beneficiary.’’. 


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1 (b) EFFECTIVE DATE.—The amendment made by 

2 this section shall apply with respect to interests acquired 

3 after the date of the enactment of this Act. 

4 SEC. 203. PURCHASE OF HEALTH INSURANCE FROM HSA 

5 ACCOUNT. 

6 (a) IN GENERAL.—Section 223(c)(2) of the Internal 

7 Revenue Code of 1986, as redesignated by section 

8 201(c)(3), is amended— 

9 (1) in subparagraph (C)— 

10 (A) by striking ‘‘or’’ at the end of clause 

11 (iii), 

12 (B) by striking the period at the end of 

13 clause (iv) and inserting ‘‘, and’’, and 

14 (C) by adding at the end the following new 

15 clause: 

16 ‘‘(v) in the case of health insurance 

17 that meets the requirements of subpara18 graph (D).’’; and 

19 (2) by adding at the end the following new sub20 paragraphs: 

21 ‘‘(D) REQUIREMENTS.—The requirements 

22 of this subparagraph are as follows: 

23 ‘‘(i) OPEN ENROLLMENT WITHOUT

24 PREEXISTING CONDITION EXCLUSIONS.— 

25 The health insurance coverage or group 


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1 health plan must permit, during uniform 

2 initial and annual open enrollment periods 

3 and for special enrollment periods (such as 

4 the loss of coverage through the loss of 

5 employment) specified in carrying out sec6 tion 105(b) of the Patient Freedom Act of 

7 2015, any individual who has period of 

8 continuous coverage of not less than 18 

9 months who is otherwise eligible to enroll 

10 under such coverage or plan to be so en11 rolled without the imposition of any pre12 existing condition exclusion (as defined for 

13 purposes of title XXVII of the Public 

14 Health Service Act). 

15 ‘‘(ii) CLASS BASED PREMIUMS FOR

16 BASIC BENEFITS.— 

17 ‘‘(I) IN GENERAL.—The premium 

18 for such coverage or plan shall be es19 tablished based on class-average sta20 tus and may vary by age and geo21 graphic area, but may not vary based 

22 upon the health status of the indi23 vidual, except that in the case of an 

24 individual without continuous cov25 erage for a period of 42 months, such 


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1 premium may be increased above the 

2 class-average in the manner and for 

3 the time period specified in section 

4 105(d)(1)(A)(ii) of the Patient Free5 dom Act of 2015. 

6 ‘‘(II) ESTABLISHMENT OF ACTU7 ARIAL TABLES.—In carrying out sub8 clause (I), the Secretary shall enter 

9 into a contract with a qualified orga10 nization, such as the Academy of Ac11 tuaries, for the development of actu12 arial tables to calculate class-average 

13 rates based on age and geography. 

14 ‘‘(E) CONTINUOUS COVERAGE.—For pur15 poses of this paragraph, an individual shall be 

16 considered to have continuous coverage as of a 

17 time if the individual has no continuous period 

18 in which the individual is uninsured (as defined 

19 in section 100 of the Patient Freedom Act of 

20 2015) for longer than 63 days beginning after 

21 the date of the enactment of such Act.’’. 

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

23 this section shall apply to taxable years beginning after 

24 December 31, 2015. 


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1 SEC. 204. PUBLISHING OF CASH PRICE FOR CARE PAID 

2 THROUGH HEALTH SAVINGS ACCOUNTS. 

3 (a) IN GENERAL.—Section 223(e) of the Internal 

4 Revenue Code of 1986, as redesignated by section 

5 201(c)(3), is amended by adding at the end the following 

6 new paragraph: 

7 ‘‘(9) CASH PRICE TRANSPARENCY REQUIRED

8 FOR PAYMENTS TO HEALTH CARE PROVIDERS.— 

9 ‘‘(A) IN GENERAL.—A payment to a health 

10 care provider with respect to the furnishing of 

11 health care items and services by such provider 

12 shall not be treated as a qualified medical ex13 pense unless the health care provider provides 

14 for continuing disclosure (such as through post15 ing on a publicly accessible website) of the cash 

16 price the health care provider charges for the 

17 furnishing of such items and services. 

18 ‘‘(B) FORM OF DISCLOSURE.—The disclo19 sure of prices under this subsection shall be in 

20 a form and manner specified by the Secretary 

21 of Health and Human Services, in consultation 

22 with the Secretary, and shall be designed— 

23 ‘‘(i) to establish a single price for re24 lated items and services in a manner simi25 lar to the manner in which pricing and 

26 payment for such items and services is proVerDate Sep 11 2014 23:36 Jun 17, 2015 Jkt 049200 PO 00000 Frm 00047 Fmt 6652 Sfmt 6201 E:\BILLS\H2756.IH H2756

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1 vided under the Medicare program under 

2 title XVIII of the Social Security Act, and 

3 ‘‘(ii) to make it easy for consumers to 

4 compare the prices for similar items and 

5 services furnished by different providers. 

6 ‘‘(C) FAILURE TO FURNISH SERVICES OR

7 CHARGE IN EXCESS OF STATED PRICE.—A 

8 health care provider shall be treated as not 

9 meeting the requirement of subparagraph (A), 

10 in the case of items and services for which the 

11 provider is disclosing a cash price, if the pro12 vider— 

13 ‘‘(i) refuses to furnish such items or 

14 services at the price listed, or 

15 ‘‘(ii) charges more than the price list16 ed for the furnishing of the items and serv17 ices.’’. 

18 (b) ENFORCEMENT.—If the Secretary of Health and 

19 Human Services determines that a health care provider 

20 has not provided for continuing disclosure of the cash 

21 price of health care provider charges under section 

22 223(e)(9) of the Internal Revenue Code of 1986, the Sec23 retary may instruct the Secretary of the Treasury that 

24 payments made to such provider shall be not treated, for 

25 purposes of section 223 of the Internal Revenue Code of 


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1 1986, as an amount used for a qualified medical expense 

2 for a period of not to exceed 1 year. 

3 (c) EFFECTIVE DATE.—The amendments made by 

4 this section shall apply to taxable years beginning after 

5 December 31, 2015. 

6 Subtitle B—Health Care Tax 

7 Credits 

8 SEC. 211. LIMITED APPLICATION OF PPACA HEALTH PRE9 MIUM CREDIT. 

10 (a) IN GENERAL.—Section 36B(c)(1) of the Internal 

11 Revenue Code of 1986 is amended by adding at the end 

12 the following: 

13 ‘‘(E) SPECIAL RULE FOR RESIDENTS OF

14 STATES CONTINUING PPACA IMPLEMENTA15 TION.—No credit shall be allowed under this 

16 section to any individual who is not a qualified 

17 resident (as defined in section 100(14) of the 

18 Patient Freedom Act of 2015) of a State that 

19 has elected the option under section 101(a)(1) 

20 of such Act in relation to the implementation of 

21 title I of the Patient Protection and Affordable 

22 Care Act.’’. 

23 (b) EFFECTIVE DATE.—The amendment made by 

24 this section shall apply to taxable years beginning after 

25 December 31, 2015. 


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1 SEC. 212. NEW HSA CREDIT. 

2 (a) IN GENERAL.—Subpart C of part IV of sub3 chapter A of chapter 1 of the Internal Revenue Code of 

4 1986 is amended by adding at the end the following new 

5 section: 

6 ‘‘SEC. 36C. HSA CREDIT. 

7 ‘‘(a) IN GENERAL.—In the case of a qualified indi8 vidual, there shall be allowed as a credit against the tax 

9 imposed by this subtitle for any taxable year, an amount 

10 equal to the HSA credit amount of the individual for the 

11 taxable year. 

12 ‘‘(b) QUALIFYING INDIVIDUAL.—For purposes of this 

13 section, the term ‘qualifying individual’ means, with re14 spect to any month, any individual who for such month 

15 is deposit qualifying resident (as defined in section 

16 102(b)(2) of the Patient Freedom Act of 2015) of a State 

17 described in section 101(a)(3) of such Act that elects to 

18 have section 102(b) of such Act carried out by way of the 

19 credit determined under this section. 

20 ‘‘(c) HSA CREDIT AMOUNT.—For purposes of this 

21 section, the term ‘HSA credit amount’ means, with respect 

22 to any taxable year, the sum of the HSA deposit amounts 

23 determined under section 103 of the Patient Freedom Act 

24 of 2015 with respect to the individual for all months end25 ing during the taxable year. 


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1 ‘‘(d) SPECIAL RULES.—For purposes of this sec2 tion— 

3 ‘‘(1) RECONCILIATION OF CREDIT AND AD4 VANCE CREDIT.— 

5 ‘‘(A) EXCESS ADVANCE PAYMENTS.—If the 

6 advance payments to an individual for a taxable 

7 year under subsection (e) exceed the credit al8 lowed by this section with respect to such indi9 vidual for such taxable year, the tax imposed by 

10 this chapter for the taxable year shall be in11 creased by the amount of such excess. 

12 ‘‘(B) ADVANCE PAYMENT SHORTFALL.—If 

13 the credit allowed by this section (determined 

14 without regard to this subparagraph) with re15 spect to an individual for a taxable year exceeds 

16 the advance payments to such individual for 

17 such taxable year under subsection (e), the Sec18 retary shall, in lieu of a credit allowed against 

19 the tax imposed by this subtitle, make a pay20 ment on behalf of such individual to such indi21 vidual’s health savings account in an amount 

22 equal to such excess. 

23 ‘‘(2) MARRIED COUPLES MUST FILE JOINT RE24 TURN.—If the taxpayer is married (within the mean25 ing of section 7703) at the close of the taxable year, 


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1 the credit shall be allowed under this section only if 

2 the taxpayer and the taxpayer’s spouse file a joint 

3 return for the taxable year. 

4 ‘‘(e) ADVANCE PAYMENT PROGRAM.— 

5 ‘‘(1) IN GENERAL.—The Secretary of the 

6 Treasury, in consultation with the Secretary of 

7 Health and Human Services, shall establish a pro8 gram— 

9 ‘‘(A) to make advance determinations with 

10 respect to the eligibility of individuals for the 

11 credit allowed under this section, and 

12 ‘‘(B) to make advance payments of the 

13 credit allowed under this section directly to the 

14 health savings account of any such individual so 

15 eligible. 

16 ‘‘(2) PROGRAM REQUIREMENTS.—Such pro17 gram shall be established under rules similar to the 

18 rules of section 1412 of the Patient Protection and 

19 Affordable Care Act, except that advance determina20 tions and advance payments shall be made on re21 quest of the individual with respect to whom the de22 termination is to be made and taking into account 

23 the enrollment process (including any opt-out elec24 tion under such process) established under section 

25 104(c)(1) of the Patient Freedom Act of 2015.’’. 


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1 (b) CLERICAL AMENDMENT.—The table of sections 

2 for such subpart is amended by adding at the end the fol3 lowing: 

‘‘Sec. 36C. HSA credit.’’. 

4 (c) EFFECTIVE DATE.—The amendments made by 

5 this section shall apply to taxable years beginning after 

6 December 31, 2015. 

Æ 


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