II

106TH CONGRESS

1ST SESSION S. 300

To improve the access and choice of patients to quality, affordable health

care.

IN THE SENATE OF THE UNITED STATES

JANUARY 22, 1999

Mr. LOTT (for himself, Mr. NICKLES, Ms. COLLINS, Mr. FRIST, Mr. GRAMM,

Mr. HAGEL, Mr. JEFFORDS, Mr. ROTH, Mr. SANTORUM, Mr. MACK, Mr.

CRAIG, Mr. COVERDELL, Mr. MCCONNELL, Mr. ABRAHAM, Mr. ALLARD,

Mr. ASHCROFT, Mr. BENNETT, Mr. BOND, Mr. BROWNBACK, Mr.

BUNNING, Mr. BURNS, Mr. CAMPBELL, Mr. COCHRAN, Mr. DEWINE, Mr.

DOMENICI, Mr. ENZI, Mr. GORTON, Mr. GRAMS, Mr. GRASSLEY, Mr.

GREGG, Mr. HATCH, Mr. HELMS, Mr. HUTCHINSON, Mrs. HUTCHISON,

Mr. INHOFE, Mr. LUGAR, Mr. MCCAIN, Mr. MURKOWSKI, Mr. ROBERTS,

Mr. SESSIONS, Mr. SHELBY, Mr. SMITH of New Hampshire, Mr. SMITH

of Oregon, Ms. SNOWE, Mr. STEVENS, Mr. THOMAS, Mr. THOMPSON, Mr.

THURMOND, Mr. VOINOVICH, and Mr. WARNER) introduced the following

bill; which was read twice and referred to the Committee on Finance

A BILL

To improve the access and choice of patients to quality,

affordable health care.

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 ‘‘Patients’ Bill of Rights Plus Act’’.
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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.

TITLE I—PATIENTS’ BILL OF RIGHTS

Subtitle A—Right to Advice and Care

Sec. 101. Patient right to medical advice and care.

‘‘SUBPART C—PATIENT RIGHT TO MEDICAL ADVICE AND CARE

‘‘Sec. 721. Patient access to emergency medical care.

‘‘Sec. 722. Offering of choice of coverage options.

‘‘Sec. 723. Patient access to obstetric and gynecological care.

‘‘Sec. 724. Patient access to pediatric care.

‘‘Sec. 725. Continuity of care.

‘‘Sec. 726. Protection of patient-provider communications.

‘‘Sec. 727. Generally applicable provision.

Sec. 102. Effective date and related rules.

Subtitle B—Right to Information About Plans and Providers

Sec. 111. Information about plans.

Sec. 112. Information about providers.

Subtitle C—Right to Hold Health Plans Accountable

Sec. 121. Amendment to Employee Retirement Income Security Act of 1974.

Subtitle D—Miscellaneous Provisions

Sec. 131. Amendments to the Internal Revenue Code of 1986.

TITLE II—INDIVIDUAL RIGHTS WITH RESPECT TO PERSONAL

MEDICAL INFORMATION

Sec. 201. Short title.

Subtitle A—Access to Medical Records

Sec. 211. Inspection and copying of protected health information.

Sec. 212. Amendment of protected health information.

Sec. 213. Notice of confidentiality practices.

Subtitle B—Establishment of Safeguards

Sec. 221. Establishment of safeguards.

Subtitle C—Enforcement; Definitions

Sec. 231. Civil penalty.

Sec. 232. Definitions.

Sec. 233. Effective date.

TITLE III—GENETIC INFORMATION AND SERVICES

Sec. 301. Short title.
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Sec. 302. Amendments to Employee Retirement Income Security Act of 1974.

Sec. 303. Amendments to the Public Health Service Act.

Sec. 304. Amendments to the Internal Revenue Code of 1986.

TITLE IV—HEALTHCARE RESEARCH AND QUALITY

Sec. 401. Short title.

Sec. 402. Amendment to the Public Health Service Act.

‘‘TITLE IX—AGENCY FOR HEALTHCARE RESEARCH AND QUALITY

‘‘PART A—ESTABLISHMENT AND GENERAL DUTIES

‘‘Sec. 901. Mission and duties.

‘‘Sec. 902. General authorities.

‘‘PART B—HEALTHCARE IMPROVEMENT RESEARCH

‘‘Sec. 911. Healthcare outcome improvement research.

‘‘Sec. 912. Private-public partnerships to improve organization and delivery.

‘‘Sec. 913. Information on quality and cost of care.

‘‘Sec. 914. Information systems for healthcare improvement.

‘‘Sec. 915. Research supporting primary care and access in underserved

areas.

‘‘Sec. 916. Clinical practice and technology innovation.

‘‘Sec. 917. Coordination of Federal Government quality improvement efforts.

‘‘PART C—GENERAL PROVISIONS

‘‘Sec. 921. Advisory Council for Healthcare Research and Quality.

‘‘Sec. 922. Peer review with respect to grants and contracts.

‘‘Sec. 923. Certain provisions with respect to development, collection, and

dissemination of data.

‘‘Sec. 924. Dissemination of information.

‘‘Sec. 925. Additional provisions with respect to grants and contracts.

‘‘Sec. 926. Certain administrative authorities.

‘‘Sec. 927. Funding.

‘‘Sec. 928. Definitions.

Sec. 403. References.

Sec. 404. Study.

TITLE V—ENHANCED ACCESS TO HEALTH INSURANCE

COVERAGE

Sec. 501. Full deduction of health insurance costs for self-employed individuals.

Sec. 502. Full availability of medical savings accounts.

Sec. 503. Carryover of unused benefits from cafeteria plans, flexible spending

arrangements, and health flexible spending accounts.

Sec. 504. Permitting contribution towards medical savings account through

Federal employees health benefits program (FEHBP).
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1 TITLE I—PATIENTS’ BILL OF

2 RIGHTS

3 Subtitle A—Right to Advice and

4 Care

5 SEC. 101. PATIENT RIGHT TO MEDICAL ADVICE AND CARE.

6 (a) IN GENERAL.—Part 7 of subtitle B of title I of

7 the Employee Retirement Income Security Act of 1974

8 (29 U.S.C. 1185 et seq.) is amended—

9 (1) by redesignating subpart C as subpart D;

10 and

11 (2) by inserting after subpart B the following:

12 ‘‘Subpart C—Patient Right to Medical Advice and

13 Care

14 ‘‘SEC. 721. PATIENT ACCESS TO EMERGENCY MEDICAL

15 CARE.

16 ‘‘(a) IN GENERAL.—To the extent that the group

17 health plan (other than a fully insured group health plan)

18 provides coverage for benefits consisting of emergency

19 medical care (as defined in subsection (c)), except for

20 items or services specifically excluded—

21 ‘‘(1) the plan shall provide coverage for bene22 fits, without requiring preauthorization, for appro23 priate emergency medical screening examinations

24 (within the capability of the emergency facility, in25 cluding ancillary services routinely available to the
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1 emergency facility) to the extent that a prudent

2 layperson, who possesses an average knowledge of

3 health and medicine, would determine such examina4 tions to be necessary to determine whether emer5 gency medical care (as so defined) is necessary, and

6 ‘‘(2) the plan shall provide coverage for benefits

7 for additional emergency medical care to stabilize an

8 emergency medical condition following an emergency

9 medical screening examination (if determined nec10 essary under paragraph (1)), pursuant to the defini11 tion of stabilize under section 1867(e)(3) of the So12 cial Security Act (42 U.S.C. 1395dd(e)(3)).

13 ‘‘(b) UNIFORM COST-SHARING REQUIRED.—Nothing

14 in this section shall be construed as preventing a group

15 health plan (other than a fully insured group health plan)

16 from imposing any form of cost-sharing applicable to any

17 participant or beneficiary (including coinsurance, copay18 ments, deductibles, and any other charges) in relation to

19 coverage for benefits described in subsection (a), if such

20 form of cost-sharing is uniformly applied under such plan,

21 with respect to similarly situated participants and bene22 ficiaries, to all benefits consisting of emergency medical

23 care (as defined in subsection (c)) provided to such simi24 larly situated participants and beneficiaries under the

25 plan.
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1 ‘‘(c) DEFINITION OF EMERGENCY MEDICAL CARE.—

2 In this section:

3 ‘‘(1) IN GENERAL.—The term ‘‘emergency med4 ical care’’ means, with respect to a participant or

5 beneficiary under a group health plan (other than a

6 fully insured group health plan), covered inpatient

7 and outpatient services that—

8 ‘‘(A) are furnished by any provider, includ9 ing a nonparticipating provider, that is qualified

10 to furnish such services; and

11 ‘‘(B) are needed to evaluate or stabilize (as

12 such term is defined in section 1867(e)(3) of

13 the Social Security Act (42 U.S.C. 1395dd)) an

14 emergency medical condition (as defined in

15 paragraph (2)).

16 ‘‘(2) EMERGENCY MEDICAL CONDITION.—The

17 term ‘‘emergency medical condition’’ means a medi18 cal condition manifesting itself by acute symptoms

19 of sufficient severity (including severe pain) such

20 that a prudent layperson, who possesses an average

21 knowledge of health and medicine, could reasonably

22 expect the absence of immediate medical attention to

23 result in—

24 ‘‘(A) placing the health of the participant

25 or beneficiary (or, with respect to a pregnant
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1 woman, the health of the woman or her unborn

2 child) in serious jeopardy,

3 ‘‘(B) serious impairment to bodily func4 tions, or

5 ‘‘(C) serious dysfunction of any bodily

6 organ or part.

7 ‘‘SEC. 722. OFFERING OF CHOICE OF COVERAGE OPTIONS.

8 ‘‘(a) REQUIREMENT.—

9 ‘‘(1) OFFERING OF POINT-OF-SERVICE COV10 ERAGE OPTION.—Except as provided in paragraph

11 (2), if a group health plan (other than a fully in12 sured group health plan) provides coverage for bene13 fits only through a defined set of participating

14 health care professionals, the plan shall offer the

15 participant the option to purchase point-of-service

16 coverage (as defined in subsection (b)) for all such

17 benefits for which coverage is otherwise so limited.

18 Such option shall be made available to the partici19 pant at the time of enrollment under the plan and

20 at such other times as the plan offers the participant

21 a choice of coverage options.

22 ‘‘(2) EXCEPTION IN THE CASE OF MULTIPLE

23 ISSUER OR COVERAGE OPTIONS.—Paragraph (1)

24 shall not apply with respect to a participant in a
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1 group health plan (other than a fully insured group

2 health plan) if the plan offers the participant—

3 ‘‘(A) a choice of health insurance coverage

4 through more than one health insurance issuer;

5 or

6 ‘‘(B) two or more coverage options that

7 differ significantly with respect to the use of

8 participating health care professionals or the

9 networks of such professionals that are used.

10 ‘‘(b) POINT-OF-SERVICE COVERAGE DEFINED.—In

11 this section, the term ‘point-of-service coverage’ means,

12 with respect to benefits covered under a group health plan

13 (other than a fully insured group health plan), coverage

14 of such benefits when provided by a nonparticipating

15 health care professional.

16 ‘‘(c) SMALL EMPLOYER EXEMPTION.—

17 ‘‘(1) IN GENERAL.—This section shall not apply

18 to any group health plan (other than a fully insured

19 group health plan) of a small employer.

20 ‘‘(2) SMALL EMPLOYER.—For purposes of

21 paragraph (1), the term ‘small employer’ means, in

22 connection with a group health plan (other than a

23 fully insured group health plan) with respect to a

24 calendar year and a plan year, an employer who em25 ployed an average of at least 2 but not more than
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1 50 employees on business days during the preceding

2 calendar year and who employs at least 2 employees

3 on the first day of the plan year. For purposes of

4 this paragraph, the provisions of subparagraph (C)

5 of section 712(c)(1) shall apply in determining em6 ployer size.

7 ‘‘(d) RULE OF CONSTRUCTION.—Nothing in this sec8 tion shall be construed—

9 ‘‘(1) as requiring coverage for benefits for a

10 particular type of health care professional;

11 ‘‘(2) as requiring an employer to pay any costs

12 as a result of this section or to make equal contribu13 tions with respect to different health coverage op14 tions;

15 ‘‘(3) as preventing a group health plan (other

16 than a fully insured group health plan) from impos17 ing higher premiums or cost-sharing on a partici18 pant for the exercise of a point-of-service coverage

19 option; or

20 ‘‘(4) to require that a group health plan (other

21 than a fully insured group health plan) include cov22 erage of health care professionals that the plan ex23 cludes because of fraud, quality of care, or other

24 similar reasons with respect to such professionals.
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1 ‘‘SEC. 723. PATIENT ACCESS TO OBSTETRIC AND GYNECO2 LOGICAL CARE.

3 ‘‘(a) IN GENERAL.—In any case in which a group

4 health plan (other than a fully insured group health

5 plan)—

6 ‘‘(1) provides coverage for benefits consisting

7 of—

8 ‘‘(A) gynecological care (such as preventive

9 women’s health examinations); or

10 ‘‘(B) obstetric care (such as pregnancy-re11 lated services);

12 provided by a participating physician who specializes

13 in such care; and

14 ‘‘(2) requires or provides for designation by a

15 participant or beneficiary of a participating primary

16 care provider;

17 if the primary care provider designated by such a partici18 pant or beneficiary is not such a physician as described

19 in paragraph (1), then the plan shall meet the require20 ments of subsection (b).

21 ‘‘(b) REQUIREMENTS.—A group health plan (other

22 than a fully insured group health plan) meets the require23 ments of this subsection, in connection with the coverage

24 of benefits described in subsection (a) consisting of care

25 described in subparagraph (A) or (B) of subsection (a)(1),

26 if the plan—
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1 ‘‘(1) does not require authorization or a referral

2 by the primary care provider in order to obtain cov3 erage for such benefits, and

4 ‘‘(2) treats the ordering of other routine care

5 related to the care described in subparagraph (A) or

6 (B) of subsection (a)(1), by the participating physi7 cian providing the care described in either such sub8 paragraph, as the authorization of the primary care

9 provider with respect to such care.

10 ‘‘(c) RULE OF CONSTRUCTION.—Nothing in sub11 section (b)(2) shall waive any requirements of coverage re12 lating to medical necessity or appropriateness with respect

13 to coverage of gynecological or obstetric care so ordered.

14 Nothing in subsection (b) shall be construed to preclude

15 the health plan from requiring that the obstetrician or

16 gynecologist notify the primary care provider or the plan

17 of treatment decisions.

18 ‘‘SEC. 724. PATIENT ACCESS TO PEDIATRIC CARE.

19 ‘‘(a) IN GENERAL.—In any case in which a group

20 health plan (other than a fully insured group health

21 plan)—

22 ‘‘(1) provides coverage for benefits consisting of

23 pediatric care by a participating pediatrician; and
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1 ‘‘(2) requires or provides for designation by a

2 participant or beneficiary of a participating primary

3 care provider;

4 if the primary care provider designated by such a partici5 pant or beneficiary is not a physician as described in para6 graph (1), then the plan shall meet the requirements of

7 subsection (b).

8 ‘‘(b) REQUIREMENTS.—A group health plan (other

9 than a fully insured group health plan) meets the require10 ments of this subsection, in connection with the coverage

11 of benefits described in subsection (a) consisting of care

12 described in subsection (a)(1), if the plan—

13 ‘‘(1) does not require authorization or a referral

14 by the primary care provider in order to obtain cov15 erage for such benefits, and

16 ‘‘(2) treats the ordering of other routine care of

17 the same type, by the participating physician provid18 ing the care described in subsection (a)(1), as the

19 authorization of the primary care provider with re20 spect to such care.

21 ‘‘(c) CONSTRUCTION.—Nothing in subsection (b)(2)

22 shall waive any requirements of coverage relating to medi23 cal necessity or appropriateness with respect to coverage

24 of pediatric care so ordered.
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1 ‘‘SEC. 725. CONTINUITY OF CARE.

2 ‘‘(a) IN GENERAL.—

3 ‘‘(1) TERMINATION OF PROVIDER.—If a con4 tract between a group health plan (other than a fully

5 insured group health plan) and a health care pro6 vider is terminated (as defined in paragraph (2)), or

7 benefits or coverage provided by a health care pro8 vider are terminated because of a change in the

9 terms of provider participation in such group health

10 plan, and an individual who is a participant or bene11 ficiary in the plan is undergoing a course of treat12 ment from the provider at the time of such termi13 nation, the plan shall—

14 ‘‘(A) notify the individual on a timely basis

15 of such termination;

16 ‘‘(B) provide the individual with an oppor17 tunity to notify the plan of a need for transi18 tional care; and

19 ‘‘(C) in the case of termination described

20 in paragraph (2), (3), or (4) of subsection (b),

21 and subject to subsection (c), permit the indi22 vidual to continue or be covered with respect to

23 the course of treatment with the provider’s con24 sent during a transitional period (as provided

25 under subsection (b)).
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1 ‘‘(2) TERMINATED.—In this section, the term

2 ‘terminated’ includes, with respect to a contract, the

3 expiration or nonrenewal of the contract by the

4 group health plan, but does not include a termi5 nation of the contract by the plan for failure to meet

6 applicable quality standards or for fraud.

7 ‘‘(3) CONTRACTS.—For purposes of this sec8 tion, the term ‘contract between a group health plan

9 (other than a fully insured group health plan) and

10 a health care provider’ shall include a contract be11 tween such a plan and an organized network of pro12 viders.

13 ‘‘(b) TRANSITIONAL PERIOD.—

14 ‘‘(1) GENERAL RULE.—Except as provided in

15 paragraph (3), the transitional period under this

16 subsection shall extend for up to 90 days from the

17 date of the notice described in subsection (a)(1)(A)

18 of the provider’s termination.

19 ‘‘(2) INSTITUTIONAL CARE.—Subject to para20 graph (1), the transitional period under this sub21 section for institutional or inpatient care from a pro22 vider shall extend until the discharge or termination

23 of the period of institutionalization and also shall in24 clude institutional care provided within a reasonable

25 time of the date of termination of the provider sta-
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1 tus if the care was scheduled before the date of the

2 announcement of the termination of the provider

3 status under subsection (a)(1)(A) or if the individual

4 on such date was on an established waiting list or

5 otherwise scheduled to have such care.

6 ‘‘(3) PREGNANCY.—Notwithstanding paragraph

7 (1), if—

8 ‘‘(A) a participant or beneficiary has en9 tered the second trimester of pregnancy at the

10 time of a provider’s termination of participa11 tion; and

12 ‘‘(B) the provider was treating the preg13 nancy before the date of the termination;

14 the transitional period under this subsection with re15 spect to provider’s treatment of the pregnancy shall

16 extend through the provision of post-partum care di17 rectly related to the delivery.

18 ‘‘(4) TERMINAL ILLNESS.—Subject to para19 graph (1), if—

20 ‘‘(A) a participant or beneficiary was de21 termined to be terminally ill (as determined

22 under section 1861(dd)(3)(A) of the Social Se23 curity Act) prior to a provider’s termination of

24 participation; and
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1 ‘‘(B) the provider was treating the termi2 nal illness before the date of termination;

3 the transitional period under this subsection shall be

4 for care directly related to the treatment of the ter5 minal illness.

6 ‘‘(c) PERMISSIBLE TERMS AND CONDITIONS.—A

7 group health plan (other than a fully insured group health

8 plan) may condition coverage of continued treatment by

9 a provider under subsection (a)(1)(B) upon the provider

10 agreeing to the following terms and conditions:

11 ‘‘(1) The provider agrees to accept reimburse12 ment from the plan and individual involved (with re13 spect to cost-sharing) at the rates applicable prior to

14 the start of the transitional period as payment in

15 full (or, in the case described in subsection (b)(2),

16 at the rates applicable under the replacement plan

17 after the date of the termination of the contract with

18 the group health plan) and not to impose cost-shar19 ing with respect to the individual in an amount that

20 would exceed the cost-sharing that could have been

21 imposed if the contract referred to in subsection

22 (a)(1) had not been terminated.

23 ‘‘(2) The provider agrees to adhere to the qual24 ity assurance standards of the plan responsible for

25 payment under paragraph (1) and to provide to such
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1 plan necessary medical information related to the

2 care provided.

3 ‘‘(3) The provider agrees otherwise to adhere to

4 such plan’s policies and procedures, including proce5 dures regarding referrals and obtaining prior au6 thorization and providing services pursuant to a

7 treatment plan (if any) approved by the plan.

8 ‘‘(d) RULE OF CONSTRUCTION.—Nothing in this sec9 tion shall be construed to require the coverage of benefits

10 which would not have been covered if the provider involved

11 remained a participating provider.

12 ‘‘(e) DEFINITION.—In this section, the term ‘health

13 care provider’ or ‘provider’ means—

14 ‘‘(1) any individual who is engaged in the deliv15 ery of health care services in a State and who is re16 quired by State law or regulation to be licensed or

17 certified by the State to engage in the delivery of

18 such services in the State; and

19 ‘‘(2) any entity that is engaged in the delivery

20 of health care services in a State and that, if it is

21 required by State law or regulation to be licensed or

22 certified by the State to engage in the delivery of

23 such services in the State, is so licensed.
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1 ‘‘SEC. 726. PROTECTION OF PATIENT-PROVIDER COMMU2 NICATIONS.

3 ‘‘(a) IN GENERAL.—Subject to subsection (b), a

4 group health plan (other than a fully insured group health

5 plan and in relation to a participant or beneficiary) shall

6 not prohibit or otherwise restrict a health care professional

7 from advising such a participant or beneficiary who is a

8 patient of the professional about the health status of the

9 participant or beneficiary or medical care or treatment for

10 the condition or disease of the participant or beneficiary,

11 regardless of whether coverage for such care or treatment

12 are provided under the contract, if the professional is act13 ing within the lawful scope of practice.

14 ‘‘(b) RULE OF CONSTRUCTION.—Nothing in this sec15 tion shall be construed as requiring a group health plan

16 (other than a fully insured group health plan) to provide

17 specific benefits under the terms of such plan.

18 ‘‘SEC. 727. GENERALLY APPLICABLE PROVISION.

19 ‘‘In the case of a group health plan that provides ben20 efits under 2 or more coverage options, the requirements

21 of sections 721, 723, 724, 725 and 726 shall apply sepa22 rately with respect to each coverage option.’’.

23 (b) RULE WITH RESPECT TO CERTAIN PLANS.—

24 (1) IN GENERAL.—Notwithstanding any other

25 provision of law, health insurance issuers may offer,

26 and eligible individuals may purchase, high deduct-
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1 ible health plans described in section 220(c)(2)(A) of

2 the Internal Revenue Code of 1986. Effective for the

3 4-year period beginning on the date of the enact4 ment of this Act, such health plans shall not be re5 quired to provide payment for any health care items

6 or services that are exempt from the plan’s deduct7 ible.

8 (2) EXISTING STATE LAWS.—A State law relat9 ing to payment for health care items and services in

10 effect on the date of enactment of this Act that is

11 preempted under paragraph (1), shall not apply to

12 high deductible health plans after the expiration of

13 the 4-year period described in such paragraph unless

14 the State reenacts such law after such period.

15 (c) DEFINITION.—Section 733(a) of the Employee

16 Retirement Income Security Act of 1974 (42 U.S.C.

17 1186(a)) is amended by adding at the end the following:

18 ‘‘(3) FULLY INSURED GROUP HEALTH PLAN.—

19 The term ‘fully insured group health plan’ means a

20 group health plan where benefits are provided pursu21 ant to the terms of an arrangement between a group

22 health plan and a health insurance issuer and are

23 guaranteed by the health insurance issuer under a

24 contract or policy of insurance.’’.
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1 (d) CONFORMING AMENDMENT.—The table of con2 tents in section 1 of such Act is amended—

3 (1) in the item relating to subpart C, by strik4 ing ‘‘Subpart C’’ and inserting ‘‘Subpart D’’; and

5 (2) by adding at the end of the items relating

6 to subpart B of part 7 of subtitle B of title I of such

7 Act the following new items:

‘‘SUBPART C—PATIENT RIGHT TO MEDICAL ADVICE AND CARE

‘‘Sec. 721. Patient access to emergency medical care.

‘‘Sec. 722. Offering of choice of coverage options.

‘‘Sec. 723. Patient access to obstetric and gynecological care.

‘‘Sec. 724. Patient access to pediatric care.

‘‘Sec. 725. Continuity of care.

‘‘Sec. 726. Protection of patient-provider communications.

‘‘Sec. 727. Generally applicable provisions.’’.

8 SEC. 102. EFFECTIVE DATE AND RELATED RULES.

9 (a) IN GENERAL.—The amendments made by this

10 subtitle shall apply with respect to plan years beginning

11 on or after January 1 of the second calendar year follow12 ing the date of the enactment of this Act. The Secretary

13 shall issue all regulations necessary to carry out the

14 amendments made by this section before the effective date

15 thereof.

16 (b) LIMITATION ON ENFORCEMENT ACTIONS.—No

17 enforcement action shall be taken, pursuant to the amend18 ments made by this subtitle, against a group health plan

19 with respect to a violation of a requirement imposed by

20 such amendments before the date of issuance of regula21 tions issued in connection with such requirement, if the
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1 plan has sought to comply in good faith with such require2 ment.

3 Subtitle B—Right to Information

4 About Plans and Providers

5 SEC. 111. INFORMATION ABOUT PLANS.

6 (a) IN GENERAL.—Subpart B of part 7 of subtitle

7 B of title I of the Employee Retirement Income Security

8 Act of 1974, as amended by the Omnibus Consolidated

9 and Emergency Supplemental Appropriations Act, 1999

10 (Public Law 105-277), is amended by adding at the end

11 the following:

12 ‘‘SEC. 714. HEALTH PLAN COMPARATIVE INFORMATION.

13 ‘‘(a) REQUIREMENT.—A group health plan, or health

14 insurance issuer in connection with group health insurance

15 coverage, shall, not later than 12 months after the date

16 of enactment of this section, provide for the disclosure,

17 in a clear and accurate form to each enrollee, or upon re18 quest to a potential enrollee eligible to receive benefits

19 under the plan, or plan sponsor with which the plan or

20 issuer has contracted, of the information described in sub21 section (b).

22 ‘‘(b) REQUIRED INFORMATION.—The informational

23 materials to be distributed under this section shall include

24 for each health benefit plan the following:
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1 ‘‘(1) A description of the covered items and

2 services under each such plan and any in- and out3 of-network features of each such plan.

4 ‘‘(2) A description of any cost-sharing, includ5 ing premiums, deductibles, coinsurance, and copay6 ment amounts, for which the enrollee will be respon7 sible, including any annual or lifetime limits on ben8 efits, for each such plan.

9 ‘‘(3) A description of any optional supplemental

10 benefits offered by each such plan and the terms

11 and conditions (including premiums or cost-sharing)

12 for such supplemental coverage.

13 ‘‘(4) A description of any restrictions on pay14 ments for services furnished to an enrollee by a

15 health care professional that is not a participating

16 professional and the liability of the enrollee for addi17 tional payments for these services.

18 ‘‘(5) A description of the service area of each

19 such plan, including the provision of any out-of-area

20 coverage.

21 ‘‘(6) A description of the extent to which enroll22 ees may select the primary care provider of their

23 choice, including providers both within the network

24 and outside the network of each such plan (if the

25 plan permits out-of-network services).
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1 ‘‘(7) A description of the procedures for ad2 vance directives and organ donation decisions if the

3 plan maintains such procedures.

4 ‘‘(8) A description of the requirements and pro5 cedures to be used to obtain preauthorization for

6 health services (including telephone numbers and

7 mailing addresses), including referrals for specialty

8 care.

9 ‘‘(9) A summary of the rules and methods for

10 appealing coverage decisions and filing grievances

11 (including telephone numbers and mailing address12 es), as well as other available remedies.

13 ‘‘(10) A summary of the rules for access to

14 emergency room care. Also, any available edu15 cational material regarding proper use of emergency

16 services.

17 ‘‘(11) A description of whether or not coverage

18 is provided for experimental treatments, investiga19 tional treatments, or clinical trials and the cir20 cumstances under which access to such treatments

21 or trials is made available.

22 ‘‘(12) A description of the specific preventative

23 services covered under the plan if such services are

24 covered.

25 ‘‘(13) A statement regarding—
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1 ‘‘(A) the manner in which an enrollee may

2 access an obstetrician, gynecologist, or pediatri3 cian in accordance with section 723 or 724;

4 ‘‘(B) the manner in which an enrollee ob5 tains continuity of care as provided for in sec6 tion 725; and

7 ‘‘(C) the manner in which an enrollee has

8 access to the medical records of the enrollee in

9 accordance with subtitle A of title II of the Pa10 tients’ Bill of Rights Plus Act.

11 ‘‘(14) A statement that the following informa12 tion, and instructions on obtaining such information

13 (including telephone numbers and, if available,

14 Internet websites), shall be made available upon re15 quest:

16 ‘‘(A) The names, addresses, telephone

17 numbers, and State licensure status of the

18 plan’s participating health care professionals

19 and participating health care facilities, and, if

20 available, the education, training, speciality

21 qualifications or certifications of such profes22 sionals.

23 ‘‘(B) A summary description of the meth24 ods used for compensating participating health

25 care professionals, such as capitation, fee-for-
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1 service, salary, or a combination thereof. The

2 requirement of this subparagraph shall not be

3 construed as requiring plans to provide infor4 mation concerning proprietary payment meth5 odology.

6 ‘‘(C) A summary description of the meth7 ods used for compensating health care facilities,

8 including per diem, fee-for-service, capitation,

9 bundled payments, or a combination thereof.

10 The requirement of this subparagraph shall not

11 be construed as requiring plans to provide in12 formation concerning proprietary payment

13 methodology.

14 ‘‘(D) A summary description of the proce15 dures used for utilization review.

16 ‘‘(E) The list of the specific prescription

17 medications included in the formulary of the

18 plan, if the plan uses a defined formulary, and

19 any provision for obtaining off-formulary medi20 cations.

21 ‘‘(F) A description of the specific exclu22 sions from coverage under the plan.

23 ‘‘(G) Any available information related to

24 the availability of translation or interpretation

25 services for non-English speakers and people
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1 with communication disabilities, including the

2 availability of audio tapes or information in

3 Braille.

4 ‘‘(H) Any information that is made public

5 by accrediting organizations in the process of

6 accreditation if the plan is accredited, or any

7 additional quality indicators that the plan

8 makes available.

9 ‘‘(c) MANNER OF DISTRIBUTION.—

10 ‘‘(1) IN GENERAL.—The information described

11 in this section shall be distributed in an accessible

12 format that is understandable to an average plan en13 rollee.

14 ‘‘(2) RULE OF CONSTRUCTION.—For purposes

15 of this section, a group health plan, or health insur16 ance issuer in connection with group health insur17 ance coverage, in reliance on records maintained by

18 the plan or issuer, shall be deemed to have met the

19 requirements of this section if the plan or issuer pro20 vides the information requested under this section—

21 ‘‘(A) in the case of the plan, to partici22 pants and beneficiaries at the address contained

23 in such records with respect to such partici24 pants and beneficiaries; or
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1 ‘‘(B) in the case of the issuer, to the em2 ployer of a participant if the employer provides

3 for the coverage of such participant under the

4 plan involved or to participants and bene5 ficiaries at the address contained in such

6 records with respect to such participants and

7 beneficiaries.

8 ‘‘(d) RULE OF CONSTRUCTION.—Nothing in this sec9 tion may be construed to prohibit a group health plan,

10 or health insurance issuer in connection with group health

11 insurance coverage, from distributing any other additional

12 information determined by the plan or issuer to be impor13 tant or necessary in assisting participants and bene14 ficiaries enrollees or upon request potential participants

15 in the selection of a health plan or from providing informa16 tion under subsection (b)(13) as part of the required infor17 mation.

18 ‘‘(e) HEALTH CARE PROFESSIONAL.—In this section,

19 the term ‘health care professional’ means a physician (as

20 defined in section 1861(r) of the Social Security Act) or

21 other health care professional if coverage for the profes22 sional’s services is provided under the health plan involved

23 for the services of the professional. Such term includes a

24 podiatrist, optometrist, chiropractor, psychologist, dentist,

25 physician assistant, physical or occupational therapist and
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1 therapy assistant, speech-language pathologist, audiol2 ogist, registered or licensed practical nurse (including

3 nurse practitioner, clinical nurse specialist, certified reg4 istered nurse anesthetist, and certified nurse-midwife), li5 censed certified social worker, registered respiratory thera6 pist, and certified respiratory therapy technician.’’.

7 (b) CONFORMING AMENDMENTS.—

8 (1) Section 732(a) of the Employee Retirement

9 Income Security Act of 1974 (29 U.S.C. 1185(a)) is

10 amended by striking ‘‘section 711, and inserting

11 ‘‘sections 711 and 714’’.

12 (2) The table of contents in section 1 of the

13 Employee Retirement Income Security Act of 1974

14 (29 U.S.C. 1001) is amended by inserting after the

15 item relating to section 713, the following:

‘‘Sec. 714. Health plan comparative information.’’.

16 SEC. 112. INFORMATION ABOUT PROVIDERS.

17 (a) STUDY.—The Secretary of Health and Human

18 Services shall enter into a contract with the Institute of

19 Medicine for the conduct of a study, and the submission

20 to the Secretary of a report, that includes—

21 (1) an analysis of information concerning health

22 care professionals that is currently available to pa23 tients, consumers, States, and professional societies,

24 nationally and on a State-by-State basis, including
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1 patient preferences with respect to information

2 about such professionals and their competencies;

3 (2) an evaluation of the legal and other barriers

4 to the sharing of information concerning health care

5 professionals; and

6 (3) recommendations for the disclosure of infor7 mation on health care professionals, including the

8 competencies and professional qualifications of such

9 practitioners, to better facilitate patient choice, qual10 ity improvement, and market competition.

11 (b) REPORT.—Not later than 18 months after the

12 date of enactment of this Act, the Secretary of Health and

13 Human Services shall forward to the appropriate commit14 tees of Congress a copy of the report and study conducted

15 under subsection (a).

16 Subtitle C—Right to Hold Health

17 Plans Accountable

18 SEC. 121. AMENDMENT TO EMPLOYEE RETIREMENT IN19 COME SECURITY ACT OF 1974.

20 (a) IN GENERAL.—Section 503 of the Employee Re21 tirement Income Security Act of 1974 (29 U.S.C. 1133)

22 is amended to read as follows:
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1 ‘‘SEC. 503. CLAIMS PROCEDURE, COVERAGE DETERMINA2 TION, GRIEVANCES AND APPEALS.

3 ‘‘(a) CLAIMS PROCEDURE.—In accordance with regu4 lations of the Secretary, every employee benefit plan

5 shall—

6 ‘‘(1) provide adequate notice in writing to any

7 participant or beneficiary whose claim for benefits

8 under the plan has been denied, setting forth the

9 specific reasons for such denial, written in a manner

10 calculated to be understood by the participant, and

11 ‘‘(2) afford a reasonable opportunity to any

12 participant whose claim for benefits has been denied

13 for a full and fair review by the appropriate named

14 fiduciary of the decision denying the claim.

15 ‘‘(b) COVERAGE DETERMINATIONS UNDER GROUP

16 HEALTH PLANS.—

17 ‘‘(1) PROCEDURES.—

18 ‘‘(A) IN GENERAL.—A group health plan

19 or health insurance issuer conducting utilization

20 review shall ensure that procedures are in place

21 for—

22 ‘‘(i) making determinations regarding

23 whether an enrollee is eligible to receive a

24 payment or coverage for health services

25 under the plan or coverage involved and

26 any cost-sharing amount that the enrollee
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1 is required to pay with respect to such

2 service;

3 ‘‘(ii) notifying covered enrollees (or

4 the legal representative of such enrollees)

5 and the treating health care professionals

6 involved regarding determinations made

7 under the plan or issuer and any addi8 tional payments that the enrollee may be

9 required to make with respect to such serv10 ice; and

11 ‘‘(iii) responding to requests, either

12 written or oral, for coverage determina13 tions or for internal appeals from an en14 rollee (or the legal representative of such

15 enrollee) or the treating health care profes16 sional.

17 ‘‘(B) ORAL REQUESTS.—With respect to

18 an oral request described in subparagraph

19 (A)(iii), a group health plan or health insurance

20 issuer may require that the requesting individ21 ual provide written evidence of such request.

22 ‘‘(2) TIMELINE FOR MAKING DETERMINA23 TIONS.—

24 ‘‘(A) ROUTINE DETERMINATION.—A group

25 health plan or a health insurance issuer shall
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1 maintain procedures to ensure that prior au2 thorization determinations concerning the provi3 sion of non-emergency items or services are

4 made within 30 days from the date on which

5 the request for a determination is submitted,

6 except that such period may be extended where

7 certain circumstances exist that are determined

8 by the Secretary to be beyond control of the

9 plan or issuer.

10 ‘‘(B) EXPEDITED DETERMINATION.—

11 ‘‘(i) IN GENERAL.—A prior authoriza12 tion determination under this subsection

13 shall be made within 72 hours after a re14 quest is received by the plan or issuer

15 under clause (ii) or (iii).

16 ‘‘(ii) REQUEST BY ENROLLEE.—A

17 plan or issuer shall maintain procedures

18 for expediting a prior authorization deter19 mination under this subsection upon the

20 request of an enrollee if, based on such a

21 request, the plan or issuer determines that

22 the normal time for making such a deter23 mination could seriously jeopardize the life

24 or health of the enrollee.
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1 ‘‘(iii) DOCUMENTATION BY HEALTH

2 CARE PROFESSIONAL.—A plan or issuer

3 shall maintain procedures for expediting a

4 prior authorization determination under

5 this subsection if the request involved indi6 cates that the treating health care profes7 sional has documented, based on the medi8 cal exigencies, that a determination under

9 the procedures described in subparagraph

10 (A) could seriously jeopardize the life or

11 health of the enrollee.

12 ‘‘(C) CONCURRENT DETERMINATIONS.—A

13 plan or issuer shall maintain procedures to cer14 tify or deny coverage of an extended stay or ad15 ditional services.

16 ‘‘(D) RETROSPECTIVE DETERMINATION.—

17 A plan or issuer shall maintain procedures to

18 ensure that, with respect to the retrospective re19 view of a determination made under paragraph

20 (1), the determination shall be made within 30

21 working days of the date on which the plan or

22 issuer receives all necessary information.

23 ‘‘(3) NOTICE OF DETERMINATIONS.—

24 ‘‘(A) ROUTINE DETERMINATION.—With re25 spect to a coverage determination of a plan or
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1 issuer under paragraph (2)(A), the plan or

2 issuer shall issue notice of such determination

3 to the enrollee (or the legal representative of

4 the enrollee), and consistent with the medical

5 exigencies of the case, to the treating health

6 care professional involved not later than 2

7 working days after the date on which the deter8 mination is made.

9 ‘‘(B) EXPEDITED DETERMINATION.—With

10 respect to a coverage determination of a plan or

11 issuer under paragraph (2)(B), the plan or

12 issuer shall issue notice of such determination

13 to the enrollee (or the legal representative of

14 the enrollee), and consistent with the medical

15 exigencies of the case, to the treating health

16 care professional involved within the 72 hour

17 period described in paragraph (2)(B).

18 ‘‘(C) CONCURRENT REVIEWS.—With re19 spect to the determination under a plan or

20 issuer under paragraph (1) to certify or deny

21 coverage of an extended stay or additional serv22 ices, the plan or issuer shall issue notice of such

23 determination to the treating health care pro24 fessional and to the enrollee involved (or the

25 legal representative of the enrollee) within 1
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1 working day of the date on which the initial no2 tice was issued.

3 ‘‘(D) RETROSPECTIVE REVIEWS.—With re4 spect to the retrospective review under a plan

5 or issuer of a determination made under para6 graph (1), a determination shall be made within

7 30 working days of the date on which the plan

8 or issuer receives all necessary information. The

9 plan or issuer shall issue written notice of an

10 approval or disapproval of a determination

11 under this subparagraph to the enrollee (or the

12 legal representative of the enrollee) and health

13 care provider involved within 5 working days of

14 the date on which such determination is made.

15 ‘‘(E) REQUIREMENTS OF NOTICE OF AD16 VERSE COVERAGE DETERMINATIONS.—A writ17 ten or electronic notice of an adverse coverage

18 determination under this subsection, or of an

19 expedited adverse coverage determination under

20 paragraph (2)(B), shall be provided to the en21 rollee (or the legal representative of the en22 rollee) and treating health care professional (if

23 any) involved and shall include—

24 ‘‘(i) the reasons for the determination

25 (including the clinical or scientific-evidence
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1 based rationale used in making the deter2 mination) written in a manner to be under3 standable to the average enrollee;

4 ‘‘(ii) the procedures for obtaining ad5 ditional information concerning the deter6 mination; and

7 ‘‘(iii) notification of the right to ap8 peal the determination and instructions on

9 how to initiate an appeal in accordance

10 with subsection (d).

11 ‘‘(c) GRIEVANCES.—A group health plan or a health

12 insurance issuer shall have written procedures for address13 ing grievances between the plan and enrollees. Determina14 tions under such procedures shall be non-appealable.

15 ‘‘(d) INTERNAL APPEAL OF COVERAGE DETERMINA16 TIONS.—

17 ‘‘(1) IN GENERAL.—An enrollee (or the legal

18 representative of the enrollee) and the treating

19 health care professional with the consent of the en20 rollee (or the legal representative of the enrollee),

21 may appeal any adverse coverage determination

22 under subsection (b) under the procedures described

23 in this subsection.

24 ‘‘(2) RECORDS.—A group health plan and a

25 health insurance issuer shall maintain written
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1 records, for at least 6 years, with respect to any ap2 peal under this subsection for purposes of internal

3 quality assurance and improvement.

4 ‘‘(3) ROUTINE DETERMINATIONS.—A group

5 health plan or a health insurance issuer shall provide

6 for the consideration of an appeal of an adverse rou7 tine determination under this subsection not later

8 than 30 working days after the date on which a re9 quest for such appeal is received.

10 ‘‘(4) EXPEDITED DETERMINATION.—

11 ‘‘(A) IN GENERAL.—An expedited deter12 mination with respect to an appeal under this

13 subsection shall be made in accordance with the

14 medical exigencies of the case, but in no case

15 more than 72 hours after the request for such

16 appeal is received by the plan or issuer under

17 subparagraph (B) or (C).

18 ‘‘(B) REQUEST BY ENROLLEE.—A plan or

19 issuer shall maintain procedures for expediting

20 a prior authorization determination under this

21 subsection upon the request of an enrollee if,

22 based on such a request, the plan or issuer de23 termines that the normal time for making such

24 a determination could seriously jeopardize the

25 life or health of the enrollee.
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1 ‘‘(C) DOCUMENTATION BY HEALTH CARE

2 PROFESSIONAL.—A plan or issuer shall main3 tain procedures for expediting a prior author4 ization determination under this subsection if

5 the request involved indicates that the treating

6 health care professional has documented, based

7 on the medical exigencies that a determination

8 under the procedures described in paragraph

9 (2) could seriously jeopardize the life or health

10 of the enrollee.

11 ‘‘(5) CONDUCT OF REVIEW.—A review of an ad12 verse coverage determination under this subsection

13 shall be conducted by an individual with appropriate

14 expertise who was not involved in the initial deter15 mination.

16 ‘‘(6) LACK OF MEDICAL NECESSITY.—A review

17 of an appeal under this subsection relating to a de18 termination to deny coverage based on a lack of

19 medical necessity or appropriateness, or based on an

20 experimental or investigational treatment, shall be

21 made only by a physician with appropriate expertise

22 in the field of medicine involved who was not in23 volved in the initial determination.

24 ‘‘(7) NOTICE.—
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1 ‘‘(A) IN GENERAL.—Written notice of a

2 determination made under an internal review

3 process shall be issued to the enrollee (or the

4 legal representative of the enrollee) and the

5 treating health care professional not later than

6 2 working days after the completion of the re7 view (or within the 72-hour period referred to

8 in paragraph (4) if applicable).

9 ‘‘(B) ADVERSE COVERAGE DETERMINA10 TIONS.—With respect to an adverse coverage

11 determination made under this subsection, the

12 notice described in subparagraph (A) shall

13 include—

14 ‘‘(i) the reasons for the determination

15 (including the clinical or scientific-evidence

16 based rationale used in making the deter17 mination) written in a manner to be under18 standable to the average enrollee;

19 ‘‘(ii) the procedures for obtaining ad20 ditional information concerning the deter21 mination; and

22 ‘‘(iii) notification of the right to an

23 external review under subsection (e) and

24 instructions on how to initiate such a re25 view.
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1 ‘‘(e) EXTERNAL REVIEW.—

2 ‘‘(1) IN GENERAL.—A group health plan or a

3 health insurance issuer shall have written procedures

4 to permit an enrollee (or the legal representative of

5 the enrollee) access to an external review with re6 spect to a coverage determination concerning a par7 ticular item or service where—

8 ‘‘(A) the particular item or service in9 volved, when medically appropriate and nec10 essary, is a covered benefit under the terms and

11 conditions of the contract between the plan or

12 issuer and the enrollee;

13 ‘‘(B) the coverage determination involved

14 denied coverage for such item or service because

15 the provision of such item or service—

16 ‘‘(i) does not meet the plan’s or

17 issuer’s requirements for medical appro18 priateness or necessity and the amount in19 volved exceeds a significant financial

20 threshold; or

21 ‘‘(ii) would constitute experimental or

22 investigational treatment and there is a

23 significant risk of placing the life or health

24 of the enrollee in jeopardy; and
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1 ‘‘(C) the enrollee has completed the inter2 nal appeals process with respect to such deter3 mination.

4 ‘‘(2) INITIATION OF THE EXTERNAL REVIEW

5 PROCESS.—

6 ‘‘(A) FILING OF REQUEST.—An enrollee

7 (or the legal representative of the enrollee) who

8 desires to have an external review conducted

9 under this subsection shall file a written request

10 for such a review with the plan or issuer in11 volved not later than 30 working days after the

12 receipt of a final denial of a claim under sub13 section (d). Any such request shall include the

14 consent of the enrollee (or the legal representa15 tive of the enrollee) for the release of medical

16 information and records to external reviewers

17 regarding the enrollee if such information is

18 necessary for the proper conduct of the external

19 review.

20 ‘‘(B) INFORMATION AND NOTICE.—Not

21 later than 5 working days after the receipt of

22 a request under subparagraph (A), or earlier in

23 accordance with the medical exigencies of the

24 case, the plan or issuer involved shall select an

25 external appeals entity under paragraph (3)(A)
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1 that shall be responsible for designating an ex2 ternal reviewer under paragraph (3)(B).

3 ‘‘(C) PROVISION OF INFORMATION.—The

4 plan or issuer involved shall forward all nec5 essary information (including medical records,

6 any relevant review criteria, the clinical ration7 ale consistent with the terms and conditions of

8 the contract between the plan or issuer and the

9 enrollee for the coverage denial, and evidence of

10 the enrollee’s coverage) to the external reviewer

11 selected under paragraph (3)(B).

12 ‘‘(D) NOTIFICATION.—The plan or issuer

13 involved shall send a written notification to the

14 enrollee (or the legal representative of the en15 rollee) and the plan administrator, indicating

16 that an external review has been initiated.

17 ‘‘(3) CONDUCT OF EXTERNAL REVIEW.—

18 ‘‘(A) DESIGNATION OF EXTERNAL AP19 PEALS ENTITY BY PLAN OR ISSUER.—A plan or

20 issuer that receives a request for an external re21 view under paragraph (2)(A) shall designate

22 one of the following entities to serve as the ex23 ternal appeals entity:

24 ‘‘(i) An external review entity licensed

25 or credentialed by a State.
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1 ‘‘(ii) A State agency established for

2 the purpose of conducting independent ex3 ternal reviews.

4 ‘‘(iii) Any entity under contract with

5 the Federal Government to provide exter6 nal review services.

7 ‘‘(iv) Any entity accredited as an ex8 ternal review entity by an accrediting body

9 recognized by the Secretary for such pur10 pose.

11 ‘‘(v) Any fully accredited teaching

12 hospital.

13 ‘‘(vi) Any other entity meeting criteria

14 established by the Secretary for purposes

15 of this subparagraph.

16 ‘‘(B) DESIGNATION OF EXTERNAL RE17 VIEWER BY EXTERNAL APPEALS ENTITY.—The

18 external appeals entity designated under sub19 paragraph (A) shall, not later than 30 days

20 after the date on which such entity is des21 ignated under subparagraph (A), or earlier in

22 accordance with the medical exigencies of the

23 case, designate one or more individuals to serve

24 as external reviewers with respect to a request

25 receives under paragraph (2)(A). Such review-
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1 ers shall be independent medical experts who

2 shall—

3 ‘‘(i) be appropriately credentialed or

4 licensed in any State to deliver health care

5 services;

6 ‘‘(ii) not have any material, profes7 sional, familial, or financial affiliation with

8 the case under review, the enrollee in9 volved, the treating health care profes10 sional, the institution where the treatment

11 would take place, or the manufacturer of

12 any drug, device, procedure, or other ther13 apy proposed for the enrollee whose treat14 ment is under review;

15 ‘‘(iii) be experts in the diagnosis or

16 treatment under review and, when reason17 ably available, be of the same speciality of

18 the physician prescribing the treatment in

19 question;

20 ‘‘(iv) receive only reasonable and cus21 tomary compensation from the group

22 health plan or health insurance issuer in

23 connection with the external review that is

24 not contingent on the decision rendered by

25 the reviewer; and
45

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1 ‘‘(v) not be held liable for decisions re2 garding medical determinations (but may

3 be held liable for actions that are arbitrary

4 and capricious).

5 ‘‘(4) STANDARD OF REVIEW.—

6 ‘‘(A) IN GENERAL.—An external reviewer

7 shall—

8 ‘‘(i) make a determination based on

9 the medical necessity, appropriateness, ex10 perimental or investigational nature of the

11 coverage denial;

12 ‘‘(ii) take into consideration any evi13 dence-based decision making or clinical

14 practice guidelines used by the group

15 health plan or health insurance issuer in

16 conducting utilization review; and

17 ‘‘(iii) submit a report on the final de18 terminations of the review involved to—

19 ‘‘(I) the plan or issuer involved;

20 ‘‘(II) the enrollee involved (or the

21 legal representative of the enrollee);

22 and

23 ‘‘(III) the health care profes24 sional involved.
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1 ‘‘(B) NOTICE.—The plan or issuer involved

2 shall ensure that the enrollee receives notice,

3 within 30 days after the determination of the

4 independent medical expert, regarding the ac5 tions of the plan or issuer with respect to the

6 determination of such expert under the external

7 review.

8 ‘‘(5) TIMEFRAME FOR REVIEW.—

9 ‘‘(A) IN GENERAL.—An external reviewer

10 shall complete a review of an adverse coverage

11 determination in accordance with the medical

12 exigencies of the case.

13 ‘‘(B) LIMITATION.—Notwithstanding sub14 paragraph (A), a review described in such sub15 paragraph shall be completed not later than 30

16 working days after the later of—

17 ‘‘(i) the date on which such reviewer

18 is designated; or

19 ‘‘(ii) the date on which all information

20 necessary to completing such review is re21 ceived.

22 ‘‘(6) BINDING DETERMINATION.—The deter23 mination of an external reviewer under this sub24 section shall be binding upon the plan or issuer if

25 the provisions of this subsection or the procedures
47

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1 implemented under such provisions were complied

2 with by the external reviewer.

3 ‘‘(7) STUDY.—Not later than 2 years after the

4 date of enactment of this section, the General Ac5 counting Office shall conduct a study of a statis6 tically appropriate sample of completed external re7 views. Such study shall include an assessment of the

8 process involved during an external review and the

9 basis of decisionmaking by the external reviewer.

10 The results of such study shall be submitted to the

11 appropriate committees of Congress.

12 ‘‘(8) EFFECT ON CERTAIN PROVISIONS.—Noth13 ing in this section shall be construed as affecting or

14 modifying section 514 of this Act with respect to a

15 group health plan.

16 ‘‘(f) RULE OF CONSTRUCTION.—Nothing in this sec17 tion shall be construed to prohibit a plan administrator

18 or plan fiduciary or health plan medical director from re19 questing an external review by an external reviewer with20 out first completing the internal review process.

21 ‘‘(g) DEFINITIONS.—In this section:

22 ‘‘(1) ADVERSE COVERAGE DETERMINATION.—

23 The term ‘adverse coverage determination’ means a

24 coverage determination under the plan which results

25 in a denial of coverage or reimbursement.
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1 ‘‘(2) COVERAGE DETERMINATION.—The term

2 ‘coverage determination’ means with respect to items

3 and services for which coverage may be provided

4 under a health plan, a determination of whether or

5 not such items and services are covered or reimburs6 able under the coverage and terms of the contract.

7 ‘‘(3) ENROLLEE.—The term enrollee means a

8 participant or beneficiary.

9 ‘‘(4) GRIEVANCE.—The term ‘grievance’ means

10 any enrollee complaint that does not involve a cov11 erage determination.

12 ‘‘(5) GROUP HEALTH PLAN.—The term ‘group

13 health plan’ shall have the meaning given such term

14 in section 733(a). In applying this paragraph, ex15 cepted benefits described in section 733(c) shall not

16 be treated as benefits consisting of medical care.

17 ‘‘(6) HEALTH INSURANCE COVERAGE.—The

18 term ‘health insurance coverage’ has the meaning

19 given such term in section 733(b)(1). In applying

20 this paragraph, excepted benefits described in sec21 tion 733(c) shall not be treated as benefits consist22 ing of medical care.

23 ‘‘(7) HEALTH INSURER.—The term ‘health in24 surer’ means an insurance company, insurance serv25 ice, or an insurance organization that meets the re-
49

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1 quirements of section 733(b)(2) and that offers

2 health insurance coverage in connection with a group

3 health plan.

4 ‘‘(8) PRIOR AUTHORIZATION DETERMINA5 TION.—The term ‘prior authorization determination’

6 means a coverage determination prior to the provi7 sion of the items and services as a condition of cov8 erage of the items and services under the coverage.

9 ‘‘(9) TREATING HEALTH CARE PROFES10 SIONAL.—The term ‘treating health care profes11 sional’ with respect to a group health plan, health

12 insurance issuer or provider sponsored organization

13 means a practitioner who is acting within the scope

14 of their State licensure or certification for the deliv15 ery of health care services and who is primarily re16 sponsible for delivering those services to the enrollee.

17 ‘‘(10) UTILIZATION REVIEW.—The term ‘utili18 zation review’ with respect to a group health plan or

19 health insurance coverage means a set of formal

20 techniques designed to monitor the use of, or evalu21 ate the clinical necessity, appropriateness, efficacy,

22 or efficiency of, health care services, procedures, or

23 settings. Techniques may include ambulatory review,

24 prospective review, second opinion, certification, con-
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1 current review, case management, discharge plan2 ning or retrospective review.’’

3 (b) ENFORCEMENT.—Section 502(c)(1) of the Em4 ployee Retirement Income Security Act of 1974 (29

5 U.S.C. 1132(c)(1)) is amended by inserting after ‘‘or sec6 tion 101(e)(1)’’ the following: ‘‘, or fails to comply with

7 a coverage determination as required under section

8 503(e)(6),’’.

9 (c) CONFORMING AMENDMENT.—The table of con10 tents in section 1 of the Employee Retirement Income Se11 curity Act of 1974 is amended by striking the item relat12 ing to section 503 and inserting the following new item:

‘‘Sec. 503. Claims procedures, coverage determination, grievances and appeals.’’.

13 (d) EFFECTIVE DATE.—The amendments made by

14 this section shall apply with respect to plan years begin15 ning on or after 1 year after the date of enactment of

16 this Act. The Secretary shall issue all regulations nec17 essary to carry out the amendments made by this section

18 before the effective date thereof.

19 Subtitle D—Miscellaneous

20 Provisions

21 SEC. 131. AMENDMENTS TO THE INTERNAL REVENUE CODE

22 OF 1986.

23 Subchapter B of chapter 100 of the Internal Revenue

24 Code of 1986 (as amended by section 1531(a) of the Tax25 payer Relief Act of 1997) is amended—
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1 (1) in the table of sections, by inserting after

2 the item relating to section 9812 the following new

3 item:

‘‘Sec. 9813. Standard relating to Patients’ bill of rights.’’; and

4 (2) by inserting after section 9812 the follow5 ing:

6 ‘‘SEC. 9813. STANDARD RELATING TO PATIENTS’ BILL OF

7 RIGHTS.

8 ‘‘A group health plan shall comply with the require9 ments of section 714 and subpart C of part 7 of subtitle

10 B of title I of the Employee Retirement Income Security

11 Act of 1974 (as in effect as of the date of the enactment

12 of the Patients’ Bill of Rights Plus Act), and such require13 ments shall be deemed to be incorporated into this sec14 tion.’’.

15 TITLE II—INDIVIDUAL RIGHTS

16 WITH RESPECT TO PERSONAL

17 MEDICAL INFORMATION

18 SEC. 201. SHORT TITLE.

19 This title may be cited as the ‘‘Personal Medical In20 formation Access Act’’.
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1 Subtitle A—Access to Medical

2 Records

3 SEC. 211. INSPECTION AND COPYING OF PROTECTED

4 HEALTH INFORMATION.

5 (a) IN GENERAL.—At the request of an individual

6 and except as provided in subsection (b), a health care

7 provider, health plan, employer, health or life insurer,

8 school, or university shall permit an individual who is the

9 subject of protected health information or the individual’s

10 designee, to inspect and copy protected health information

11 concerning the individual, including records created under

12 section 212 that such entity maintains. Such entity may

13 set forth appropriate procedures to be followed for such

14 inspection or copying and may require an individual to pay

15 reasonable costs associated with such inspection or copy16 ing.

17 (b) EXCEPTIONS.—Unless ordered by a court of com18 petent jurisdiction, an entity described in subsection (a)

19 is not required to permit the inspection or copying of pro20 tected health information if any of the following conditions

21 are met:

22 (1) ENDANGERMENT TO LIFE OR SAFETY.—

23 The entity determines that the disclosure of the in24 formation could reasonably be expected to endanger

25 the life or physical safety of an individual.
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1 (2) CONFIDENTIAL SOURCE.—The information

2 identifies, or could reasonably lead to the identifica3 tion of, a person who provided information under a

4 promise of confidentiality concerning the individual

5 who is the subject of the information.

6 (3) INFORMATION COMPILED IN ANTICIPATION

7 OF LITIGATION.—The information is compiled

8 principally—

9 (A) in the reasonable anticipation of a

10 civil, criminal, or administrative action or pro11 ceeding; or

12 (B) for use in such an action or proceed13 ing.

14 (4) RESEARCH PURPOSES.—The information

15 was collected for a research project monitored by an

16 institutional review board, such project is not com17 plete, and the researcher involved reasonably believes

18 that access to such information would harm the con19 duct of the research or invalidate or undermine the

20 validity of the research.

21 (c) DENIAL OF A REQUEST FOR INSPECTION OR

22 COPYING.—If an entity described in subsection (a) denies

23 a request for inspection or copying pursuant to subsection

24 (b), the entity shall inform the individual in writing of—
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1 (1) the reasons for the denial of the request for

2 inspection or copying;

3 (2) any procedures for further review of the de4 nial; and

5 (3) the individual’s right to file with the entity

6 a concise statement setting forth the request for in7 spection or copying.

8 (d) STATEMENT REGARDING REQUEST.—If an indi9 vidual has filed a statement under subsection (c)(3), the

10 entity in any subsequent disclosure of the portion of the

11 information requested under subsection (a) shall include—

12 (1) a copy of the individual’s statement; and

13 (2) a concise statement of the reasons for deny14 ing the request for inspection or copying.

15 (e) INSPECTION AND COPYING OF SEGREGABLE POR16 TION.—An entity described in subsection (a) shall permit

17 the inspection and copying under subsection (a) of any

18 reasonably segregable portion of protected health informa19 tion after deletion of any portion that is exempt under

20 subsection (b).

21 (f) DEADLINE.—An entity described in subsection (a)

22 shall comply with or deny, in accordance with subsection

23 (c), a request for inspection or copying of protected health

24 information under this section not later than 45 days after

25 the date on which the entity receives the request.
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1 (g) RULES GOVERNING AGENTS.—An agent of an en2 tity described in subsection (a) shall not be required to

3 provide for the inspection and copying of protected health

4 information, except where—

5 (1) the protected health information is retained

6 by the agent; and

7 (2) the agent has received in writing a request

8 from the entity involved to fulfill the requirements of

9 this section;

10 at which time such information shall be provided to the

11 requesting entity. Such requesting entity shall comply with

12 subsection (f) with respect to any such information.

13 (h) RULE OF CONSTRUCTION.—This section shall not

14 be construed to require an entity described in subsection

15 (a) to conduct a formal, informal, or other hearing or pro16 ceeding concerning a request for inspection or copying of

17 protected health information.

18 SEC. 212. AMENDMENT OF PROTECTED HEALTH INFORMA19 TION.

20 (a) REQUIREMENT.—

21 (1) IN GENERAL.—Except as provided in sub22 section (b) and subject to paragraph (2), a health

23 care provider, health plan, employer, health or life

24 insurer, school, or university that receives from an
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1 individual a request in writing to amend protected

2 health information shall—

3 (A) amend such information as requested;

4 (B) inform the individual of the amend5 ment that has been made; and

6 (C) make reasonable efforts to inform any

7 person to whom the unamended portion of the

8 information was previously disclosed, of any

9 nontechnical amendment that has been made.

10 (2) COMPLIANCE.—An entity described in para11 graph (1) shall comply with the requirements of

12 such paragraph within 45 days of the date on which

13 the request involved is received if the entity—

14 (A) created the protected health informa15 tion involved; and

16 (B) determines that such information is in

17 fact inaccurate.

18 (b) REFUSAL TO AMEND.—If an entity described in

19 subsection (a) refuses to make the amendment requested

20 under such subsection, the entity shall inform the individ21 ual in writing of—

22 (1) the reasons for the refusal to make the

23 amendment;

24 (2) any procedures for further review of the re25 fusal; and
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1 (3) the individual’s right to file with the entity

2 a concise statement setting forth the requested

3 amendment and the individual’s reasons for dis4 agreeing with the refusal.

5 (c) STATEMENT OF DISAGREEMENT.—If an individ6 ual has filed a statement of disagreement under subsection

7 (b)(3), the entity involved, in any subsequent disclosure

8 of the disputed portion of the information—

9 (1) shall include a copy of the individual’s

10 statement; and

11 (2) may include a concise statement of the rea12 sons for not making the requested amendment.

13 (d) RULES GOVERNING AGENTS.—The agent of an

14 entity described in subsection (a) shall not be required to

15 make amendments to protected health information, except

16 where—

17 (1) the protected health information is retained

18 by the agent; and

19 (2) the agent has been asked by such entity to

20 fulfill the requirements of this section.

21 If the agent is required to comply with this section as pro22 vided for in paragraph (2), such agent shall be subject

23 to the 45-day deadline described in subsection (a).

24 (e) REPEATED REQUESTS FOR AMENDMENTS.—If an

25 entity described in subsection (a) receives a request for
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1 an amendment of information as provided for in such sub2 section and a statement of disagreement has been filed

3 pursuant to subsection (c), the entity shall inform the indi4 vidual of such filing and shall not be required to carry

5 out the procedures required under this section.

6 (f) RULES OF CONSTRUCTION.—This section shall

7 not be construed to—

8 (1) require that an entity described in sub9 section (a) conduct a formal, informal, or other

10 hearing or proceeding concerning a request for an

11 amendment to protected health information;

12 (2) require a provider to amend an individual’s

13 protected health information as to the type, dura14 tion, or quality of treatment the individual believes

15 he or she should have been provided; or

16 (3) permit any deletions or alterations of the

17 original information.

18 SEC. 213. NOTICE OF CONFIDENTIALITY PRACTICES.

19 (a) PREPARATION OF WRITTEN NOTICE.—A health

20 care provider, health plan, health oversight agency, public

21 health authority, employer, health or life insurer, health

22 researcher, school or university shall post or provide, in

23 writing and in a clear and conspicuous manner, notice of

24 the entity’s confidentiality practices, that shall include—
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1 (1) a description of an individual’s rights with

2 respect to protected health information;

3 (2) the procedures established by the entity for

4 the exercise of the individual’s rights; and

5 (3) the right to obtain a copy of the notice of

6 the confidentiality practices required under this sub7 title.

8 (b) MODEL NOTICE.—The Secretary, in consultation

9 with the National Committee on Vital and Health Statis10 tics and the National Association of Insurance Commis11 sioners, and after notice and opportunity for public com12 ment, shall develop and disseminate model notices of con13 fidentiality practices. Use of the model notice shall serve

14 as a defense against claims of receiving inappropriate no15 tice.

16 Subtitle B—Establishment of

17 Safeguards

18 SEC. 221. ESTABLISHMENT OF SAFEGUARDS.

19 A health care provider, health plan, health oversight

20 agency, public health authority, employer, health or life

21 insurer, health researcher, law enforcement official, school

22 or university shall establish and maintain appropriate ad23 ministrative, technical, and physical safeguards to protect

24 the confidentiality, security, accuracy, and integrity of

25 protected health information created, received, obtained,
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1 maintained, used, transmitted, or disposed of by such en2 tity.

3 Subtitle C—Enforcement;

4 Definitions

5 SEC. 231. CIVIL PENALTY.

6 (a) VIOLATION.—A health care provider, health re7 searcher, health plan, health oversight agency, public

8 health agency, law enforcement agency, employer, health

9 or life insurer, school, or university, or the agent of any

10 such individual or entity, who the Secretary, in consulta11 tion with the Attorney General, determines has substan12 tially and materially failed to comply with this Act shall,

13 for a violation of this title, be subject, in addition to any

14 other penalties that may be prescribed by law, to a civil

15 penalty of not more than $500 for each such violation,

16 but not to exceed $5,000 in the aggregate for multiple vio17 lations.

18 (b) PROCEDURES FOR IMPOSITION OF PENALTIES.—

19 Section 1128A of the Social Security Act, other than sub20 sections (a) and (b) and the second sentence of subsection

21 (f) of that section, shall apply to the imposition of a civil,

22 monetary, or exclusionary penalty under this section in the

23 same manner as such provisions apply with respect to the

24 imposition of a penalty under section 1128A of such Act.
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1 SEC. 232. DEFINITIONS.

2 In this title:

3 (1) AGENT.—The term ‘‘agent’’ means a person

4 who represents and acts for another under the con5 tract or relation of agency, or whose function is to

6 bring about, modify, affect, accept performance of,

7 or terminate contractual obligations between the

8 principal and a third person, including a contractor.

9 (2) DISCLOSE.—The term ‘‘disclose’’ means to

10 release, transfer, provide access to, or otherwise di11 vulge protected health information to any person

12 other than the individual who is the subject of such

13 information. Such term includes the initial disclosure

14 and any subsequent redisclosures of protected health

15 information.

16 (3) EMPLOYER.—The term ‘‘employer’’ has the

17 meaning given such term under section 3(5) of the

18 Employee Retirement Income Security Act of 1974

19 (29 U.S.C. 1002(5)), except that such term shall in20 clude only employers of 2 or more employees.

21 (4) HEALTH CARE PROVIDER.—The term

22 ‘‘health care provider’’ means a person who, with re23 spect to a specific item of protected health informa24 tion, receives, creates, uses, maintains, or discloses

25 the information while acting in whole or in part in

26 the capacity of—
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1 (A) a person who is licensed, certified, reg2 istered, or otherwise authorized by Federal or

3 State law to provide an item or service that

4 constitutes health care in the ordinary course of

5 business, or practice of a profession;

6 (B) a Federal, State, or employer-spon7 sored program that directly provides items or

8 services that constitute health care to bene9 ficiaries; or

10 (C) an officer, employee, or agent of a per11 son described in subparagraph (A) or (B).

12 (5) HEALTH OR LIFE INSURER.—The term

13 ‘‘health or life insurer’’ means a health insurance

14 issuer as defined in section 2791 of the Public

15 Health Service Act (42 U.S.C. 300gg–91) or a life

16 insurance company as defined in section 816 of the

17 Internal Revenue Code of 1986.

18 (6) HEALTH PLAN.—The term ‘‘health plan’’

19 means any health insurance plan, including any hos20 pital or medical service plan, dental or other health

21 service plan or health maintenance organization

22 plan, provider sponsored organization, or other pro23 gram providing or arranging for the provision of

24 health benefits, whether or not funded through the

25 purchase of insurance.
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1 (7) PERSON.—The term ‘‘person’’ means a gov2 ernment, governmental subdivision, agency or au3 thority; corporation; company; association; firm;

4 partnership; society; estate; trust; joint venture; indi5 vidual; individual representative; tribal government;

6 and any other legal entity.

7 (8) PROTECTED HEALTH INFORMATION.—The

8 term ‘‘protected health information’’ means any in9 formation (including demographic information)

10 whether or not recorded in any form or medium—

11 (A) that relates to the past, present or

12 future—

13 (i) physical or mental health or condi14 tion of an individual (including the condi15 tion or other attributes of individual cells

16 or their components);

17 (ii) provision of health care to an indi18 vidual; or

19 (iii) payment for the provision of

20 health care to an individual;

21 (B) that is created by a health care pro22 vider, health plan, health researcher, health

23 oversight agency, public health authority, em24 ployer, law enforcement official, health or life

25 insurer, school or university; and
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1 (C) that is not nonidentifiable health infor2 mation.

3 (9) SCHOOL OR UNIVERSITY.—The term

4 ‘‘school or university’’ means an institution or place

5 for instruction or education, including an elementary

6 school, secondary school, or institution of higher

7 learning, a college, or an assemblage of colleges

8 united under one corporate organization or govern9 ment.

10 (10) SECRETARY.—The term ‘‘Secretary’’

11 means the Secretary of Health and Human Services.

12 (11) WRITING.—The term ‘‘writing’’ means

13 writing in either a paper-based or computer-based

14 form, including electronic signatures.

15 SEC. 233. EFFECTIVE DATE.

16 The provisions of this title shall become effective be17 ginning on the date that is 1 year after the date of enact18 ment of this Act. The Secretary shall issue regulations

19 necessary to carry out this title before the effective date

20 thereof.

21 TITLE III—GENETIC

22 INFORMATION AND SERVICES

23 SEC. 301. SHORT TITLE.

24 This title may be cited as the ‘‘Genetic Information

25 Nondiscrimination in Health Insurance Act of 1999’’.
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1 SEC. 302. AMENDMENTS TO EMPLOYEE RETIREMENT IN2 COME SECURITY ACT OF 1974.

3 (a) PROHIBITION OF HEALTH DISCRIMINATION ON

4 THE BASIS OF GENETIC INFORMATION OR GENETIC

5 SERVICES.—

6 (1) NO ENROLLMENT RESTRICTION FOR GE7 NETIC SERVICES.—Section 702(a)(1)(F) of the Em8 ployee Retirement Income Security Act of 1974 (29

9 U.S.C. 1182(a)(1)(F)) is amended by inserting be10 fore the period the following: ‘‘(including informa11 tion about a request for or receipt of genetic serv12 ices)’’.

13 (2) NO DISCRIMINATION IN GROUP PREMIUMS

14 BASED ON PREDICTIVE GENETIC INFORMATION.—

15 Subpart B of part 7 of subtitle B of title I of the

16 Employee Retirement Income Security Act of 1974

17 (29 U.S.C. 1185 et seq.) (as amended by section

18 111) is further amended by adding at the end the

19 following:

20 ‘‘SEC. 714. PROHIBITING PREMIUM DISCRIMINATION

21 AGAINST GROUPS ON THE BASIS OF PRE22 DICTIVE GENETIC INFORMATION.

23 ‘‘A group health plan, or a health insurance issuer

24 offering group health insurance coverage in connection

25 with a group health plan, shall not adjust premium or con26 tribution amounts for a group on the basis of predictive
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1 genetic information concerning an individual in the group

2 or a family member of the individual (including informa3 tion about a request for or receipt of genetic services).’’.

4 (3) CONFORMING AMENDMENT.—Section

5 702(b) of the Employee Retirement Income Security

6 Act of 1974 (29 U.S.C. 1182(b)) is amended by

7 adding at the end the following:

8 ‘‘(3) REFERENCE TO RELATED PROVISION.—

9 For a provision prohibiting the adjustment of pre10 mium or contribution amounts for a group under a

11 group health plan on the basis of predictive genetic

12 information (including information about a request

13 for or receipt of genetic services), see section 714.’’.

14 (b) LIMITATION ON COLLECTION OF PREDICTIVE

15 GENETIC INFORMATION.—Section 702 of the Employee

16 Retirement Income Security Act of 1974 (29 U.S.C. 1182)

17 is amended by adding at the end the following:

18 ‘‘(c) COLLECTION OF PREDICTIVE GENETIC INFOR19 MATION.—

20 ‘‘(1) LIMITATION ON REQUESTING OR REQUIR21 ING PREDICTIVE GENETIC INFORMATION.—Except

22 as provided in paragraph (2), a group health plan,

23 or a health insurance issuer offering health insur24 ance coverage in connection with a group health

25 plan, shall not request or require predictive genetic
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1 information concerning an individual or a family

2 member of the individual (including information

3 about a request for or receipt of genetic services).

4 ‘‘(2) INFORMATION NEEDED FOR DIAGNOSIS,

5 TREATMENT, OR PAYMENT.—

6 ‘‘(A) IN GENERAL.—Notwithstanding para7 graph (1), a group health plan or health insur8 ance issuer that provides health care items and

9 services to an individual or dependent may re10 quest (but may not require) that such individ11 ual or dependent disclose, or authorize the col12 lection or disclosure of, predictive genetic infor13 mation for purposes of diagnosis, treatment, or

14 payment relating to the provision of health care

15 items and services to such individual or depend16 ent.

17 ‘‘(B) NOTICE OF CONFIDENTIALITY PRAC18 TICES AND DESCRIPTION OF SAFEGUARDS.—As

19 a part of a request under subparagraph (A),

20 the group health plan or health insurance issuer

21 shall provide to the individual or dependent a

22 description of the procedures in place to safe23 guard the confidentiality, as described in sec24 tions 213 and 221 of the Patients’ Bill of
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1 Rights Plus Act, of such individually identifi2 able information.’’.

3 (c) DEFINITIONS.—Section 733(d) of the Employee

4 Retirement Income Security Act of 1974 (29 U.S.C.

5 1191b(d)) is amended by adding at the end the following:

6 ‘‘(5) FAMILY MEMBER.—The term ‘family

7 member’ means with respect to an individual—

8 ‘‘(A) the spouse of the individual;

9 ‘‘(B) a dependent child of the individual,

10 including a child who is born to or placed for

11 adoption with the individual; and

12 ‘‘(C) all other individuals related by blood

13 to the individual or the spouse or child de14 scribed in subparagraph (A) or (B).

15 ‘‘(6) GENETIC INFORMATION.—The term ‘ge16 netic information’ means information about genes,

17 gene products, or inherited characteristics that may

18 derive from an individual or a family member (in19 cluding information about a request for or receipt of

20 genetic services).

21 ‘‘(7) GENETIC SERVICES.—The term ‘genetic

22 services’ means health services provided to obtain,

23 assess, or interpret genetic information for diag24 nostic and therapeutic purposes, and for genetic

25 education and counseling.
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1 ‘‘(8) PREDICTIVE GENETIC INFORMATION.—

2 ‘‘(A) IN GENERAL.—The term ‘predictive

3 genetic information’ means—

4 ‘‘(i) information about an individual’s

5 genetic tests which are associated with a

6 statistically significant increased risk of

7 developing a disease or disorder;

8 ‘‘(ii) information about genetic tests

9 of family members of the individual; or

10 ‘‘(iii) information about the occur11 rence of a disease or disorder in family

12 members that predicts a statistically sig13 nificant increased risk of a disease or dis14 order in the individual.

15 ‘‘(B) EXCEPTIONS.—The term ‘predictive

16 genetic information’ shall not include—

17 ‘‘(i) information about the sex or age

18 of the individual;

19 ‘‘(ii) information derived from routine

20 physical tests, such as the chemical, blood,

21 or urine analyses of the individual, unless

22 such analyses are genetic tests; and

23 ‘‘(iii) information about physical

24 exams of the individual and other informa25 tion relevant to determining the current
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1 health status of the individual so long as

2 such information does not include informa3 tion described in clauses (i), (ii), or (iii) of

4 subparagraph (A).

5 ‘‘(9) GENETIC TEST.—The term ‘genetic test’

6 means the analysis of human DNA, RNA, chro7 mosomes, proteins, and certain metabolites, in order

8 to detect disease-related genotypes, mutations,

9 phenotypes, or karyotypes.’’.

10 (d) EFFECTIVE DATE.—Except as provided in this

11 section, this section and the amendments made by this

12 section shall apply with respect to group health plans for

13 plan years beginning 1 year after the date of the enact14 ment of this Act.

15 SEC. 303. AMENDMENTS TO THE PUBLIC HEALTH SERVICE

16 ACT.

17 (a) AMENDMENTS RELATING TO THE GROUP MAR18 KET.—

19 (1) PROHIBITION OF HEALTH DISCRIMINATION

20 ON THE BASIS OF GENETIC INFORMATION IN THE

21 GROUP MARKET.—

22 (A) IN GENERAL.—Subpart 2 of part A of

23 title XXVII of the Public Health Service Act,

24 as amended by the Omnibus Consolidated and

25 Emergency Supplemental Appropriations Act,
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1 1999 (Public Law 105-277), is amended by

2 adding at the end the following new section:

3 ‘‘SEC. 2707. PROHIBITING PREMIUM DISCRIMINATION

4 AGAINST GROUPS ON THE BASIS OF PRE5 DICTIVE GENETIC INFORMATION IN THE

6 GROUP MARKET.

7 ‘‘A group health plan, or a health insurance issuer

8 offering group health insurance coverage in connection

9 with a group health plan shall not adjust premium or con10 tribution amounts for a group on the basis of predictive

11 genetic information concerning an individual in the group

12 or a family member of the individual (including informa13 tion about a request for or receipt of genetic services).’’.

14 (B) CONFORMING AMENDMENT.—Section

15 2702(b) of the Public Health Service Act (42

16 U.S.C. 300gg–1(b)) is amended by adding at

17 the end the following:

18 ‘‘(3) REFERENCE TO RELATED PROVISION.—

19 For a provision prohibiting the adjustment of pre20 mium or contribution amounts for a group under a

21 group health plan on the basis of predictive genetic

22 information (including information about a request

23 for or receipt of genetic services), see section 2707.’’.

24 (C) LIMITATION ON COLLECTION AND DIS25 CLOSURE OF PREDICTIVE GENETIC INFORMA-
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1 TION.—Section 2702 of the Public Health Serv2 ice Act (42 U.S.C. 300gg–1) is amended by

3 adding at the end the following:

4 ‘‘(c) COLLECTION OF PREDICTIVE GENETIC INFOR5 MATION.—

6 ‘‘(1) LIMITATION ON REQUESTING OR REQUIR7 ING PREDICTIVE GENETIC INFORMATION.—Except

8 as provided in paragraph (2), a group health plan,

9 or a health insurance issuer offering health insur10 ance coverage in connection with a group health

11 plan, shall not request or require predictive genetic

12 information concerning an individual or a family

13 member of the individual (including information

14 about a request for or receipt of genetic services).

15 ‘‘(2) INFORMATION NEEDED FOR DIAGNOSIS,

16 TREATMENT, OR PAYMENT.—

17 ‘‘(A) IN GENERAL.—Notwithstanding para18 graph (1), a group health plan or health insur19 ance issuer that provides health care items and

20 services to an individual or dependent may re21 quest (but may not require) that such individ22 ual or dependent disclose, or authorize the col23 lection or disclosure of, predictive genetic infor24 mation for purposes of diagnosis, treatment, or

25 payment relating to the provision of health care
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1 items and services to such individual or depend2 ent.

3 ‘‘(B) NOTICE OF CONFIDENTIALITY PRAC4 TICES AND DESCRIPTION OF SAFEGUARDS.—As

5 a part of a request under subparagraph (A),

6 the group health plan or health insurance issuer

7 shall provide to the individual or dependent a

8 description of the procedures in place to safe9 guard the confidentiality, as described in sec10 tions 213 and 221 of the Patients’ Bill of

11 Rights Plus Act, of such individually identifi12 able information.’’.

13 (2) DEFINITIONS.—Section 2791(d) of the Pub14 lic Health Service Act (42 U.S.C. 300gg–91(d)) is

15 amended by adding at the end the following:

16 ‘‘(15) FAMILY MEMBER.—The term ‘family

17 member’ means, with respect to an individual—

18 ‘‘(A) the spouse of the individual;

19 ‘‘(B) a dependent child of the individual,

20 including a child who is born to or placed for

21 adoption with the individual; and

22 ‘‘(C) all other individuals related by blood

23 to the individual or the spouse or child de24 scribed in subparagraph (A) or (B).
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1 ‘‘(16) GENETIC INFORMATION.—The term ‘ge2 netic information’ means information about genes,

3 gene products, or inherited characteristics that may

4 derive from an individual or a family member.

5 ‘‘(17) GENETIC SERVICES.—The term ‘genetic

6 services’ means health services provided to obtain,

7 assess, or interpret genetic information for diag8 nostic and therapeutic purposes, and for genetic

9 education and counseling.

10 ‘‘(18) PREDICTIVE GENETIC INFORMATION.—

11 ‘‘(A) IN GENERAL.—The term ‘predictive

12 genetic information’ means—

13 ‘‘(i) information about an individual’s

14 genetic tests which is associated with a

15 statistically significant increased risk of

16 developing a disease or disorder;

17 ‘‘(ii) information about genetic tests

18 of family members of the individual; or

19 ‘‘(iii) information about the occur20 rence of a disease or disorder in family

21 members that predicts a statistically sig22 nificant increased risk of a disease or dis23 order in the individual.

24 ‘‘(B) EXCEPTIONS.—The term ‘predictive

25 genetic information’ shall not include—
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1 ‘‘(i) information about the sex or age

2 of the individual;

3 ‘‘(ii) information derived from routine

4 physical tests, such as the chemical, blood,

5 or urine analyses of the individual, unless

6 such analyses are genetic tests; and

7 ‘‘(iii) information about physical

8 exams of the individual and other informa9 tion relevant to determining the current

10 health status of the individual so long as

11 such information does not include informa12 tion described in clauses (i), (ii), or (iii) of

13 subparagraph (A).

14 ‘‘(19) GENETIC TEST.—The term ‘genetic test’

15 means the analysis of human DNA, RNA, chro16 mosomes, proteins, and certain metabolites, in order

17 to detect disease-related genotypes, mutations,

18 phenotypes, or karyotypes.’’.

19 (b) AMENDMENT RELATING TO THE INDIVIDUAL

20 MARKET.—The first subpart 3 of part B of title XXVII

21 of the Public Health Service Act (42 U.S.C. 300gg–11 et

22 seq.) (relating to other requirements), as amended by the

23 Omnibus Consolidated and Emergency Supplemental

24 Appropriations Act, 1999 (Public Law 105-277) is

25 amended—
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1 (1) by redesignating such subpart as subpart 2;

2 and

3 (2) by adding at the end the following:

4 ‘‘SEC. 2753. PROHIBITION OF HEALTH DISCRIMINATION ON

5 THE BASIS OF PREDICTIVE GENETIC INFOR6 MATION.

7 ‘‘(a) PROHIBITION ON PREDICTIVE GENETIC INFOR8 MATION AS A CONDITION OF ELIGIBILITY.—A health in9 surance issuer offering health insurance coverage in the

10 individual market may not use predictive genetic informa11 tion as a condition of eligibility of an individual to enroll

12 in individual health insurance coverage (including infor13 mation about a request for or receipt of genetic services).

14 ‘‘(b) PROHIBITION ON PREDICTIVE GENETIC INFOR15 MATION IN SETTING PREMIUM RATES.—A health insur16 ance issuer offering health insurance coverage in the indi17 vidual market shall not adjust premium rates for individ18 uals on the basis of predictive genetic information concern19 ing such an enrollee or a family member of the enrollee

20 (including information about a request for or receipt of

21 genetic services).

22 ‘‘(c) COLLECTION OF PREDICTIVE GENETIC INFOR23 MATION.—

24 ‘‘(1) LIMITATION ON REQUESTING OR REQUIR25 ING PREDICTIVE GENETIC INFORMATION.—Except
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1 as provided in paragraph (2), a health insurance

2 issuer offering health insurance coverage in the indi3 vidual market shall not request or require predictive

4 genetic information concerning an individual or a

5 family member of the individual (including informa6 tion about a request for or receipt of genetic serv7 ices).

8 ‘‘(2) INFORMATION NEEDED FOR DIAGNOSIS,

9 TREATMENT, OR PAYMENT.—

10 ‘‘(A) IN GENERAL.—Notwithstanding para11 graph (1), a health insurance issuer that pro12 vides health care items and services to an indi13 vidual or dependent may request (but may not

14 require) that such individual or dependent dis15 close, or authorize the collection or disclosure

16 of, predictive genetic information for purposes

17 of diagnosis, treatment, or payment relating to

18 the provision of health care items and services

19 to such individual or dependent.

20 ‘‘(B) NOTICE OF CONFIDENTIALITY PRAC21 TICES AND DESCRIPTION OF SAFEGUARDS.—As

22 a part of a request under subparagraph (A),

23 the health insurance issuer shall provide to the

24 individual or dependent a description of the

25 procedures in place to safeguard the confiden-
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1 tiality, as described in sections 213 and 221 of

2 the Patients’ Bill of Rights Plus Act, of such

3 individually identifiable information.’’.

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

5 this section shall apply with respect to—

6 (1) group health plans, and health insurance

7 coverage offered in connection with group health

8 plans, for plan years beginning after 1 year after the

9 date of enactment of this Act; and

10 (2) health insurance coverage offered, sold,

11 issued, renewed, in effect, or operated in the individ12 ual market after 1 year after the date of enactment

13 of this Act.

14 SEC. 304. AMENDMENTS TO THE INTERNAL REVENUE CODE

15 OF 1986.

16 (a) PROHIBITION OF HEALTH DISCRIMINATION ON

17 THE BASIS OF PREDICTIVE GENETIC INFORMATION.—

18 (1) IN GENERAL.—Subchapter B of chapter

19 100 of the Internal Revenue Code of 1986 (as

20 amended by section 131) is further amended by add21 ing at the end the following:
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1 ‘‘SEC. 9814. PROHIBITING HEALTH DISCRIMINATION

2 AGAINST GROUPS ON THE BASIS OF PRE3 DICTIVE GENETIC INFORMATION.

4 ‘‘A group health plan shall not adjust premium or

5 contribution amounts for a group on the basis of predictive

6 genetic information concerning an individual in the group

7 or a family member of the individual (including informa8 tion about a request for or receipt of genetic services).’’.

9 (2) CONFORMING AMENDMENT.—Section

10 9802(b) of the Internal Revenue Code of 1986 is

11 amended by adding at the end the following:

12 ‘‘(3) REFERENCE TO RELATED PROVISION.—

13 For a provision prohibiting the adjustment of pre14 mium or contribution amounts for a group under a

15 group health plan on the basis of predictive genetic

16 information (including information about a request

17 for or the receipt of genetic services), see section

18 9814.’’.

19 (3) AMENDMENT TO TABLE OF SECTIONS.—

20 The table of sections for subchapter B of chapter

21 100 of the Internal Revenue Code of 1986 (as

22 amended by section 131) is further amended by add23 ing at the end the following:

‘‘Sec. 9814. Prohibiting premium discrimination against groups on the basis of

predictive genetic information.’’.
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1 (b) LIMITATION ON COLLECTION OF PREDICTIVE

2 GENETIC INFORMATION.—Section 9802 of the Internal

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

4 the following:

5 ‘‘(c) COLLECTION OF PREDICTIVE GENETIC INFOR6 MATION.—

7 ‘‘(1) LIMITATION ON REQUESTING OR REQUIR8 ING PREDICTIVE GENETIC INFORMATION.—Except

9 as provided in paragraph (2), a group health plan

10 shall not request or require predictive genetic infor11 mation concerning an individual or a family member

12 of the individual (including information about a re13 quest for or receipt of genetic services).

14 ‘‘(2) INFORMATION NEEDED FOR DIAGNOSIS,

15 TREATMENT, OR PAYMENT.—

16 ‘‘(A) IN GENERAL.—Notwithstanding para17 graph (1), a group health plan that provides

18 health care items and services to an individual

19 or dependent may request (but may not re20 quire) that such individual or dependent dis21 close, or authorize the collection or disclosure

22 of, predictive genetic information for purposes

23 of diagnosis, treatment, or payment relating to

24 the provision of health care items and services

25 to such individual or dependent.
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1 ‘‘(B) NOTICE OF CONFIDENTIALITY PRAC2 TICES; DESCRIPTION OF SAFEGUARDS.—As a

3 part of a request under subparagraph (A), the

4 group health plan shall provide to the individual

5 or dependent a description of the procedures in

6 place to safeguard the confidentiality, as de7 scribed in sections 213 and 221 of the Patients’

8 Bill of Rights Plus Act, of such individually

9 identifiable information.’’.

10 (c) DEFINITIONS.—Section 9832(d) of the Internal

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

12 the following:

13 ‘‘(6) FAMILY MEMBER.—The term ‘family

14 member’ means, with respect to an individual—

15 ‘‘(A) the spouse of the individual;

16 ‘‘(B) a dependent child of the individual,

17 including a child who is born to or placed for

18 adoption with the individual; and

19 ‘‘(C) all other individuals related by blood

20 to the individual or the spouse or child de21 scribed in subparagraph (A) or (B).

22 ‘‘(7) GENETIC INFORMATION.—The term ‘ge23 netic information’ means information about genes,

24 gene products, or inherited characteristics that may

25 derive from an individual or a family member.
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1 ‘‘(8) GENETIC SERVICES.—The term ‘genetic

2 services’ means health services provided to obtain,

3 assess, or interpret genetic information for diag4 nostic and therapeutic purposes, and for genetic

5 education and counseling.

6 ‘‘(9) PREDICTIVE GENETIC INFORMATION.—

7 ‘‘(A) IN GENERAL.—The term ‘predictive

8 genetic information’ means—

9 ‘‘(i) information about an individual’s

10 genetic tests which is associated with a

11 statistically significant increased risk of

12 developing a disease or disorder;

13 ‘‘(ii) information about genetic tests

14 of family members of the individual; or

15 ‘‘(iii) information about the occur16 rence of a disease or disorder in family

17 members that predicts a statistically sig18 nificant increased risk of a disease or dis19 order in the individual.

20 ‘‘(B) EXCEPTIONS.—The term ‘predictive

21 genetic information’ shall not include—

22 ‘‘(i) information about the sex or age

23 of the individual;

24 ‘‘(ii) information derived from routine

25 physical tests, such as the chemical, blood,
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1 or urine analyses of the individual, unless

2 such analyses are genetic tests; and

3 ‘‘(iii) information about physical

4 exams of the individual and other informa5 tion relevant to determining the current

6 health status of the individual so long as

7 such information does not include informa8 tion described in clauses (i), (ii), or (iii) of

9 subparagraph (A).

10 ‘‘(10) GENETIC TEST.—The term ‘genetic test’

11 means the analysis of human DNA, RNA, chro12 mosomes, proteins, and certain metabolites, in order

13 to detect disease-related genotypes, mutations,

14 phenotypes, or karyotypes.’’.

15 (d) EFFECTIVE DATE.—Except as provided in this

16 section, this section and the amendments made by this

17 section shall apply with respect to group health plans for

18 plan years beginning after 1 year after the date of the

19 enactment of this Act.

20 TITLE IV—HEALTHCARE

21 RESEARCH AND QUALITY

22 SEC. 401. SHORT TITLE.

23 This title may be cited as the ‘‘Healthcare Research

24 and Quality Act of 1999’’.
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1 SEC. 402. AMENDMENT TO THE PUBLIC HEALTH SERVICE

2 ACT.

3 Title IX of the Public Health Service Act (42 U.S.C.

4 299 et seq.) is amended to read as follows:

5 ‘‘TITLE IX—AGENCY FOR

6 HEALTHCARE RESEARCH

7 AND QUALITY

8 ‘‘PART A—ESTABLISHMENT AND GENERAL

9 DUTIES

10 ‘‘SEC. 901. MISSION AND DUTIES.

11 ‘‘(a) IN GENERAL.—There is established within the

12 Public Health Service an agency to be known as the Agen13 cy for Healthcare Research and Quality. In carrying out

14 this subsection, the Secretary shall redesignate the Agency

15 for Health Care Policy and Research as the Agency for

16 Healthcare Research and Quality.

17 ‘‘(b) MISSION.—The purpose of the Agency is to en18 hance the quality, appropriateness, and effectiveness of

19 healthcare services, and access to such services, through

20 the establishment of a broad base of scientific research

21 and through the promotion of improvements in clinical

22 and health system practice, including the prevention of

23 diseases and other health conditions. The Agency shall

24 promote healthcare quality improvement by—
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1 ‘‘(1) conducting and supporting research that

2 develops and presents scientific evidence regarding

3 all aspects of healthcare, including—

4 ‘‘(A) the development and assessment of

5 methods for enhancing patient participation in

6 their own care and for facilitating shared pa7 tient-physician decision-making;

8 ‘‘(B) the outcomes, effectiveness, and cost9 effectiveness of healthcare practices, including

10 preventive measures and primary, acute and

11 long-term care;

12 ‘‘(C) existing and innovative technologies;

13 ‘‘(D) the costs and utilization of, and ac14 cess to healthcare;

15 ‘‘(E) the ways in which healthcare services

16 are organized, delivered, and financed and the

17 interaction and impact of these factors on the

18 quality of patient care;

19 ‘‘(F) methods for measuring quality and

20 strategies for improving quality; and

21 ‘‘(G) ways in which patients, consumers,

22 purchasers, and practitioners acquire new infor23 mation about best practices and health benefits,

24 the determinants and impact of their use of this

25 information;
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1 ‘‘(2) synthesizing and disseminating available

2 scientific evidence for use by patients, consumers,

3 practitioners, providers, purchasers, policy makers,

4 and educators; and

5 ‘‘(3) advancing private and public efforts to im6 prove healthcare quality.

7 ‘‘(c) REQUIREMENTS WITH RESPECT TO RURAL

8 AREAS AND PRIORITY POPULATIONS.—In carrying out

9 subsection (b), the Director shall undertake and support

10 research, demonstration projects, and evaluations with re11 spect to—

12 ‘‘(1) the delivery of health services in rural

13 areas (including frontier areas);

14 ‘‘(2) health services for low-income groups, and

15 minority groups;

16 ‘‘(3) the health of children;

17 ‘‘(4) the elderly; and

18 ‘‘(5) people with special healthcare needs, in19 cluding disabilities, chronic care and end-of-life

20 healthcare.

21 ‘‘(d) APPOINTMENT OF DIRECTOR.—There shall be

22 at the head of the Agency an official to be known as the

23 Director for Healthcare Research and Quality. The Direc24 tor shall be appointed by the Secretary. The Secretary,
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1 acting through the Director, shall carry out the authorities

2 and duties established in this title.

3 ‘‘SEC. 902. GENERAL AUTHORITIES.

4 ‘‘(a) IN GENERAL.—In carrying out section 901(b),

5 the Director shall support demonstration projects, conduct

6 and support research, evaluations, training, research net7 works, multi-disciplinary centers, technical assistance, and

8 the dissemination of information, on healthcare, and on

9 systems for the delivery of such care, including activities

10 with respect to—

11 ‘‘(1) the quality, effectiveness, efficiency, appro12 priateness and value of healthcare services;

13 ‘‘(2) quality measurement and improvement;

14 ‘‘(3) the outcomes, cost, cost-effectiveness, and

15 use of healthcare services and access to such serv16 ices;

17 ‘‘(4) clinical practice, including primary care

18 and practice-oriented research;

19 ‘‘(5) healthcare technologies, facilities, and

20 equipment;

21 ‘‘(6) healthcare costs, productivity, organiza22 tion, and market forces;

23 ‘‘(7) health promotion and disease prevention,

24 including clinical preventive services;
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1 ‘‘(8) health statistics, surveys, database devel2 opment, and epidemiology; and

3 ‘‘(9) medical liability.

4 ‘‘(b) HEALTH SERVICES TRAINING GRANTS.—

5 ‘‘(1) IN GENERAL.—The Director may provide

6 training grants in the field of health services re7 search related to activities authorized under sub8 section (a), to include pre- and post-doctoral fellow9 ships and training programs, young investigator

10 awards, and other programs and activities as appro11 priate. In carrying out this subsection, the Director

12 shall make use of funds made available under sec13 tion 487.

14 ‘‘(2) REQUIREMENTS.—In developing priorities

15 for the allocation of training funds under this sub16 section, the Director shall take into consideration

17 shortages in the number of trained researchers ad18 dressing the priority populations.

19 ‘‘(c) MULTIDISCIPLINARY CENTERS.—The Director

20 may provide financial assistance to assist in meeting the

21 costs of planning and establishing new centers, and oper22 ating existing and new centers, for multidisciplinary

23 health services research, demonstration projects, evalua24 tions, training, and policy analysis with respect to the mat25 ters referred to in subsection (a).
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1 ‘‘(d) RELATION TO CERTAIN AUTHORITIES REGARD2 ING SOCIAL SECURITY.—Activities authorized in this sec3 tion may include, and shall be appropriately coordinated

4 with experiments, demonstration projects, and other relat5 ed activities authorized by the Social Security Act and the

6 Social Security Amendments of 1967. Activities under

7 subsection (a)(2) of this section that affect the programs

8 under titles XVIII, XIX and XXI of the Social Security

9 Act shall be carried out consistent with section 1142 of

10 such Act.

11 ‘‘(e) DISCLAIMER.—The Agency shall not mandate

12 national standards of clinical practice or quality

13 healthcare standards. Recommendations resulting from

14 projects funded and published by the Agency shall include

15 a corresponding disclaimer.

16 ‘‘(f) RULE OF CONSTRUCTION.—Nothing in this sec17 tion shall be construed to imply that the Agency’s role is

18 to mandate a national standard or specific approach to

19 quality measurement and reporting. In research and qual20 ity improvement activities, the Agency shall consider a

21 wide range of choices, providers, healthcare delivery sys22 tems, and individual preferences.
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1 ‘‘PART B—HEALTHCARE IMPROVEMENT

2 RESEARCH

3 ‘‘SEC. 911. HEALTHCARE OUTCOME IMPROVEMENT RE4 SEARCH.

5 ‘‘(a) EVIDENCE RATING SYSTEMS.—In collaboration

6 with experts from the public and private sector, the Agen7 cy shall identify and disseminate methods or systems used

8 to assess healthcare research results, particularly to rate

9 the strength of the scientific evidence behind healthcare

10 practice, recommendations in the research literature, and

11 technology assessments. The Agency shall make methods

12 or systems for evidence rating widely available. Agency

13 publications containing healthcare recommendations shall

14 indicate the level of substantiating evidence using such

15 methods or systems.

16 ‘‘(b) HEALTHCARE IMPROVEMENT RESEARCH CEN17 TERS AND PROVIDER-BASED RESEARCH NETWORKS.—

18 ‘‘(1) IN GENERAL.—In order to address the full

19 continuum of care and outcomes research, to link re20 search to practice improvement, and to speed the

21 dissemination of research findings to community

22 practice settings, the Agency shall employ research

23 strategies and mechanisms that will link research di24 rectly with clinical practice in geographically diverse

25 locations throughout the United States, including—
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1 ‘‘(A) Healthcare Improvement Research

2 Centers that combine demonstrated multidisci3 plinary expertise in outcomes or quality im4 provement research with linkages to relevant

5 sites of care;

6 ‘‘(B) Provider-based Research Networks,

7 including plan, facility, or delivery system sites

8 of care (especially primary care), that can

9 evaluate and promote quality improvement; and

10 ‘‘(C) other innovative mechanisms or strat11 egies to link research with clinical practice.

12 ‘‘(2) REQUIREMENTS.—The Director is author13 ized to establish the requirements for entities apply14 ing for grants under this subsection.

15 ‘‘SEC. 912. PRIVATE-PUBLIC PARTNERSHIPS TO IMPROVE

16 ORGANIZATION AND DELIVERY.

17 ‘‘(a) SUPPORT FOR EFFORTS TO DEVELOP INFOR18 MATION ON QUALITY.—

19 ‘‘(1) SCIENTIFIC AND TECHNICAL SUPPORT.—

20 In its role as the principal agency for healthcare re21 search and quality, the Agency may provide sci22 entific and technical support for private and public

23 efforts to improve healthcare quality, including the

24 activities of accrediting organizations.
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1 ‘‘(2) ROLE OF THE AGENCY.—With respect to

2 paragraph (1), the role of the Agency shall include—

3 ‘‘(A) the identification and assessment

4 of—

5 ‘‘(i) methods for the evaluation of the

6 health of enrollees in health plans by type

7 of plan, provider, and provider arrange8 ments; and

9 ‘‘(ii) other populations, including

10 those receiving long-term care services;

11 ‘‘(B) the ongoing development, testing, and

12 dissemination of quality measures, including

13 measures of health and functional outcomes;

14 ‘‘(C) the compilation and dissemination of

15 healthcare quality measures developed in the

16 private and public sector;

17 ‘‘(D) assistance in the development of im18 proved healthcare information systems;

19 ‘‘(E) the development of survey tools for

20 the purpose of measuring participant and bene21 ficiary assessments of their healthcare; and

22 ‘‘(F) identifying and disseminating infor23 mation on mechanisms for the integration of in24 formation on quality into purchaser and con25 sumer decision-making processes.
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1 ‘‘(b) CENTERS FOR EDUCATION AND RESEARCH ON

2 THERAPEUTICS.—

3 ‘‘(1) IN GENERAL.—The Secretary, acting

4 through the Director and in consultation with the

5 Commissioner of Food and Drugs, shall establish a

6 program for the purpose of making one or more

7 grants for the establishment and operation of one or

8 more centers to carry out the activities specified in

9 paragraph (2).

10 ‘‘(2) REQUIRED ACTIVITIES.—The activities re11 ferred to in this paragraph are the following:

12 ‘‘(A) The conduct of state-of-the-art clini13 cal research for the following purposes:

14 ‘‘(i) To increase awareness of—

15 ‘‘(I) new uses of drugs, biological

16 products, and devices;

17 ‘‘(II) ways to improve the effec18 tive use of drugs, biological products,

19 and devices; and

20 ‘‘(III) risks of new uses and risks

21 of combinations of drugs and biologi22 cal products.

23 ‘‘(ii) To provide objective clinical in24 formation to the following individuals and

25 entities:
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1 ‘‘(I) Healthcare practitioners and

2 other providers of Healthcare goods or

3 services.

4 ‘‘(II) Pharmacists, pharmacy

5 benefit managers and purchasers.

6 ‘‘(III) Health maintenance orga7 nizations and other managed

8 healthcare organizations.

9 ‘‘(IV) Healthcare insurers and

10 governmental agencies.

11 ‘‘(V) Patients and consumers.

12 ‘‘(iii) To improve the quality of

13 healthcare while reducing the cost of

14 Healthcare through—

15 ‘‘(I) an increase in the appro16 priate use of drugs, biological prod17 ucts, or devices; and

18 ‘‘(II) the prevention of adverse

19 effects of drugs, biological products,

20 and devices and the consequences of

21 such effects, such as unnecessary hos22 pitalizations.

23 ‘‘(B) The conduct of research on the com24 parative effectiveness, cost-effectiveness, and

25 safety of drugs, biological products, and devices.
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1 ‘‘(C) Such other activities as the Secretary

2 determines to be appropriate, except that a

3 grant may not be expended to assist the Sec4 retary in the review of new drugs.

5 ‘‘(c) REDUCING ERRORS IN MEDICINE.—The Direc6 tor shall conduct and support research and build private7 public partnerships to—

8 ‘‘(1) identify the causes of preventable

9 healthcare errors and patient injury in healthcare

10 delivery;

11 ‘‘(2) develop, demonstrate, and evaluate strate12 gies for reducing errors and improving patient safe13 ty; and

14 ‘‘(3) promote the implementation of effective

15 strategies throughout the healthcare industry.

16 ‘‘SEC. 913. INFORMATION ON QUALITY AND COST OF CARE.

17 ‘‘(a) IN GENERAL.—In carrying out 902(a), the Di18 rector shall—

19 ‘‘(1) collect data on a nationally representative

20 sample of the population on the cost, use and, for

21 fiscal year 2000 and subsequent fiscal years, quality

22 of healthcare, including the types of healthcare serv23 ices Americans use, their access to healthcare serv24 ices, frequency of use, how much is paid for the

25 services used, the source of those payments, the
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1 types and costs of private health insurance, access,

2 satisfaction, and quality of care for the general pop3 ulation and also for children, uninsured persons,

4 poor and near-poor individuals, and persons with

5 special healthcare needs;

6 ‘‘(2) develop databases and tools that enable

7 States to track the quality, access, and use of

8 healthcare services provided to their residents; and

9 ‘‘(3) enter into agreements with public or pri10 vate entities to use, link, or acquire databases for re11 search authorized under this title.

12 ‘‘(b) QUALITY AND OUTCOMES INFORMATION.—

13 ‘‘(1) IN GENERAL.—To enhance the under14 standing of the quality of care, the determinants of

15 health outcomes and functional status, the needs of

16 special populations as well as an understanding of

17 these changes over time, their relationship to

18 healthcare access and use, and to monitor the overall

19 national impact of Federal and State policy changes

20 on healthcare, the Director, beginning in fiscal year

21 2000, shall ensure that the survey conducted under

22 subsection (a)(1) will—

23 ‘‘(A) provide information on the quality of

24 care and patient outcomes for frequently occur-
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1 ring clinical conditions for a nationally rep2 resentative sample of the population; and

3 ‘‘(B) provide reliable national estimates for

4 children and persons with special healthcare

5 needs through the use of supplements or peri6 odic expansions of the survey.

7 In expanding the Medical Expenditure Panel Survey,

8 as in existence on the date of enactment of this title)

9 in fiscal year 2000 to collect information on the

10 quality of care, the Director shall take into account

11 any outcomes measurements generally collected by

12 private sector accreditation organizations.

13 ‘‘(2) ANNUAL REPORT.—Beginning in fiscal

14 year 2002, the Secretary, acting through the Direc15 tor, shall submit to Congress an annual report on

16 national trends in the quality of healthcare provided

17 to the American people.

18 ‘‘SEC. 914. INFORMATION SYSTEMS FOR HEALTHCARE IM19 PROVEMENT.

20 ‘‘In order to foster a range of innovative approaches

21 to the management and communication of health informa22 tion, the Agency shall support research, evaluations and

23 initiatives to advance—

24 ‘‘(1) the use of information systems for the

25 study of healthcare quality, including the generation
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1 of both individual provider and plan-level compara2 tive performance data;

3 ‘‘(2) training for healthcare practitioners and

4 researchers in the use of information systems;

5 ‘‘(3) the creation of effective linkages between

6 various sources of health information, including the

7 development of information networks;

8 ‘‘(4) the delivery and coordination of evidence9 based healthcare services, including the use of real10 time healthcare decision-support programs;

11 ‘‘(5) the structure, content, definition, and cod12 ing of health information data and medical vocabu13 laries in consultation with appropriate Federal and

14 private entities;

15 ‘‘(6) the use of computer-based health records

16 in outpatient and inpatient settings as a personal

17 health record for individual health assessment and

18 maintenance, and for monitoring public health and

19 outcomes of care within populations; and

20 ‘‘(7) the protection of individually identifiable

21 information in health services research and

22 healthcare quality improvement.

23 ‘‘SEC. 915. RESEARCH SUPPORTING PRIMARY CARE AND

24 ACCESS IN UNDERSERVED AREAS.

25 ‘‘(a) PREVENTIVE SERVICES TASK FORCE.—
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1 ‘‘(1) PURPOSE.—The Agency shall provide on2 going administrative, research, and technical support

3 for the operation of the Preventive Services Task

4 Force. The Agency shall coordinate and support the

5 dissemination of the Preventive Services Task Force

6 recommendations.

7 ‘‘(2) OPERATION.—The Preventive Services

8 Task Force shall review the scientific evidence relat9 ed to the effectiveness, appropriateness, and cost-ef10 fectiveness of clinical preventive services for the pur11 pose of developing recommendations, and updating

12 previous recommendations, regarding their useful13 ness in daily clinical practice. In carrying out its re14 sponsibilities under paragraph (1), the Task Force

15 shall not be subject to the provisions of Appendix 2

16 of title 5, United States Code.

17 ‘‘(b) PRIMARY CARE RESEARCH.—

18 ‘‘(1) IN GENERAL.—There is established within

19 the Agency a Center for Primary Care Research (re20 ferred to in this subsection as the ‘Center’) that

21 shall serve as the principal source of funding for pri22 mary care research in the Department of Health and

23 Human Services. For purposes of this paragraph,

24 primary care research focuses on the first contact

25 when illness or health concerns arise, the diagnosis,
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1 treatment or referral to specialty care, preventive

2 care, and the relationship between the clinician and

3 the patient in the context of the family and commu4 nity.

5 ‘‘(2) RESEARCH.—In carrying out this section,

6 the Center shall conduct and support research on—

7 ‘‘(A) the nature and characteristics of pri8 mary care practice;

9 ‘‘(B) the management of commonly occur10 ring clinical problems;

11 ‘‘(C) the management of undifferentiated

12 clinical problems; and

13 ‘‘(D) the continuity and coordination of

14 health services.

15 ‘‘(3) DEMONSTRATION.—The Agency shall sup16 port demonstrations into the use of new information

17 tools aimed at improving shared decision-making be18 tween patients and their care-givers.

19 ‘‘SEC. 916. CLINICAL PRACTICE AND TECHNOLOGY INNOVA20 TION.

21 ‘‘(a) IN GENERAL.—The Director shall promote inno22 vation in evidence-based clinical practice and healthcare

23 technologies by—
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1 ‘‘(1) conducting and supporting research on the

2 development, diffusion, and use of healthcare tech3 nology;

4 ‘‘(2) developing, evaluating, and disseminating

5 methodologies for assessments of healthcare prac6 tices and healthcare technologies;

7 ‘‘(3) conducting intramural and supporting ex8 tramural assessments of existing and new healthcare

9 practices and technologies;

10 ‘‘(4) promoting education, training, and provid11 ing technical assistance in the use of healthcare

12 practice and healthcare technology assessment meth13 odologies and results; and

14 ‘‘(5) working with the National Library of Med15 icine and the public and private sector to develop an

16 electronic clearinghouse of currently available assess17 ments and those in progress.

18 ‘‘(b) SPECIFICATION OF PROCESS.—

19 ‘‘(1) IN GENERAL.—Not later than December

20 31, 2000, the Director shall develop and publish a

21 description of the methods used by the Agency and

22 its contractors for practice and technology assess23 ment.

24 ‘‘(2) CONSULTATIONS.—In carrying out this

25 subsection, the Director shall cooperate and consult
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1 with the Assistance Secretary for Health, the Ad2 ministrator of the Health Care Financing Adminis3 tration, the Director of the National Institutes of

4 Health, the Commissioner of Food and Drugs, and

5 the heads of any other interested Federal depart6 ment or agency, professional societies, and other pri7 vate and public entities.

8 ‘‘(3) METHODOLOGY.—The methods employed

9 in practice and technology assessments under para10 graph (1) shall consider—

11 ‘‘(A) safety, efficacy, and effectiveness;

12 ‘‘(B) legal, social, and ethical implications;

13 ‘‘(C) costs, benefits, and cost-effectiveness;

14 ‘‘(D) comparisons to alternative tech15 nologies and practices; and

16 ‘‘(E) requirements of Food and Drug Ad17 ministration approval to avoid duplication.

18 ‘‘(c) SPECIFIC ASSESSMENTS.—

19 ‘‘(1) IN GENERAL.—The Director shall conduct

20 or support specific assessments of healthcare tech21 nologies and practices.

22 ‘‘(2) REQUESTS FOR ASSESSMENTS.—The Di23 rector is authorized to conduct or support assess24 ments, on a reimbursable basis, for the Health Care

25 Financing Administration, the Department of De-
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1 fense, the Department of Veterans Affairs, the Of2 fice of Personnel Management, and other public or

3 private entities.

4 ‘‘(3) GRANTS AND CONTRACTS.—In addition to

5 conducting assessments, the Director may make

6 grants to, or enter into cooperative agreements or

7 contracts with, entities described in paragraph (4)

8 for the purpose of conducting assessments of experi9 mental, emerging, existing, or potentially outmoded

10 healthcare technologies, and for related activities.

11 ‘‘(4) ELIGIBLE ENTITIES.—An entity described

12 in this paragraph is an entity that is determined to

13 be appropriate by the Director, including academic

14 medical centers, research institutions, professional

15 organizations, third party payers, other govern16 mental agencies, and consortia of appropriate re17 search entities established for the purpose of con18 ducting technology assessments.

19 ‘‘SEC. 917. COORDINATION OF FEDERAL GOVERNMENT

20 QUALITY IMPROVEMENT EFFORTS.

21 ‘‘(a) REQUIREMENT.—

22 ‘‘(1) IN GENERAL.—To avoid duplication and

23 ensure that Federal resources are used efficiently

24 and effectively, the Secretary, acting through the Di25 rector, shall coordinate all research, evaluations, and
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1 demonstrations related to health services research

2 and quality measurement and improvement activities

3 undertaken and supported by the Federal Govern4 ment.

5 ‘‘(2) SPECIFIC ACTIVITIES.—The Director, in

6 collaboration with the appropriate Federal officials

7 representing all concerned executive agencies and de8 partments, shall develop and manage a process to—

9 ‘‘(A) improve interagency coordination, pri10 ority setting, and the use and sharing of re11 search findings and data pertaining to Federal

12 quality improvement programs and health serv13 ices research;

14 ‘‘(B) strengthen the research information

15 infrastructure, including databases, pertaining

16 to Federal health services research and

17 healthcare quality improvement initiatives;

18 ‘‘(C) set specific goals for participating

19 agencies and departments to further health

20 services research and healthcare quality im21 provement; and

22 ‘‘(D) strengthen the management of Fed23 eral healthcare quality improvement programs.

24 ‘‘(b) STUDY BY THE INSTITUTE OF MEDICINE.—
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1 ‘‘(1) IN GENERAL.—To provide the Department

2 of Health and Human Services with an independent,

3 external review of its quality oversight, and quality

4 research programs, the Secretary shall enter into a

5 contract with the Institute of Medicine—

6 ‘‘(A) to describe and evaluate current qual7 ity improvement research and monitoring proc8 esses through—

9 ‘‘(i) an overview of pertinent health

10 services research activities and quality im11 provement efforts including those currently

12 performed by the peer review organizations

13 and the exploration of additional activities

14 that could be undertaken by the peer re15 view organizations to improve quality;

16 ‘‘(ii) an analysis of the various part17 nership activities that the Department of

18 Health and Human Services has pursued

19 with private sector accreditation and other

20 quality measurement organizations;

21 ‘‘(iii) the exploration of programmatic

22 areas where partnership activities between

23 the Federal Government and the private

24 sector or within the Federal Government

25 could be pursued to improve quality over-
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1 sight of the medicare, medicaid and child

2 health insurance programs under titles

3 XVIII, XIX and XXI of the Social Secu4 rity Act; and

5 ‘‘(iv) an identification of opportunities

6 for enhancing health system efficiency

7 through simplification and reduction in re8 dundancy of Federal agency quality im9 provement efforts, including areas in which

10 Federal efforts unnecessarily duplicate ex11 isting private sector efforts; and

12 ‘‘(B) to identify options and make rec13 ommendations to improve the efficiency and ef14 fectiveness of such quality improvement pro15 grams through—

16 ‘‘(i) the improved coordination of ac17 tivities across the medicare, medicaid and

18 child health insurance programs under ti19 tles XVIII, XIX and XXI of the Social Se20 curity Act and various health services re21 search programs;

22 ‘‘(ii) the strengthening of patient

23 choice and participation by incorporating

24 state-of-the-art quality monitoring tools
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1 and making information on quality avail2 able; and

3 ‘‘(iii) the enhancement of the most ef4 fective programs, consolidation as appro5 priate, and elimination of duplicative ac6 tivities within various federal agencies.

7 ‘‘(2) REQUIREMENTS.—

8 ‘‘(A) IN GENERAL.—The Secretary shall

9 enter into a contract with the Institute of Medi10 cine for the preparation—

11 ‘‘(i) not later than 12 months after

12 the date of enactment of this title, of a re13 port providing an overview of the quality

14 improvement programs of the Department

15 of Health and Human Services for the

16 medicare, medicaid, and CHIP programs

17 under titles XVIII, XIX, and XXI of the

18 Social Security Act; and

19 ‘‘(ii) not later than 24 months after

20 the date of enactment of this title, of a

21 final report containing recommendations.

22 ‘‘(B) REPORTS.—The Secretary shall sub23 mit the reports described in subparagraph (A)

24 to the Committee on Finance and the Commit25 tee on Health, Education, Labor, and Pensions
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1 of the Senate and the Committee on Ways and

2 Means and the Committee on Commerce of the

3 House of Representatives.

4 ‘‘PART C—GENERAL PROVISIONS

5 ‘‘SEC. 921. ADVISORY COUNCIL FOR HEALTHCARE RE6 SEARCH AND QUALITY.

7 ‘‘(a) ESTABLISHMENT.—There is established an advi8 sory council to be known as the Advisory Council for

9 Healthcare Research and Quality.

10 ‘‘(b) DUTIES.—

11 ‘‘(1) IN GENERAL.—The Advisory Council shall

12 advise the Secretary and the Director with respect

13 to activities proposed or undertaken to carry out the

14 purpose of the Agency under section 901(b).

15 ‘‘(2) CERTAIN RECOMMENDATIONS.—Activities

16 of the Advisory Council under paragraph (1) shall

17 include making recommendations to the Director

18 regarding—

19 ‘‘(A) priorities regarding healthcare re20 search, especially studies related to quality, out21 comes, cost and the utilization of, and access

22 to, healthcare services;

23 ‘‘(B) the field of healthcare research and

24 related disciplines, especially issues related to
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1 training needs, and dissemination of informa2 tion pertaining to healthcare quality; and

3 ‘‘(C) the appropriate role of the Agency in

4 each of these areas in light of private sector ac5 tivity and identification of opportunities for

6 public-private sector partnerships.

7 ‘‘(c) MEMBERSHIP.—

8 ‘‘(1) IN GENERAL.—The Advisory Council shall,

9 in accordance with this subsection, be composed of

10 appointed members and ex officio members. All

11 members of the Advisory Council shall be voting

12 members other than the individuals designated

13 under paragraph (3)(B) as ex officio members.

14 ‘‘(2) APPOINTED MEMBERS.—The Secretary

15 shall appoint to the Advisory Council 21 appro16 priately qualified individuals. At least 17 members of

17 the Advisory Council shall be representatives of the

18 public who are not officers or employees of the

19 United States. The Secretary shall ensure that the

20 appointed members of the Council, as a group, are

21 representative of professions and entities concerned

22 with, or affected by, activities under this title and

23 under section 1142 of the Social Security Act. Of

24 such members—
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1 ‘‘(A) 4 shall be individuals distinguished in

2 the conduct of research, demonstration projects,

3 and evaluations with respect to healthcare;

4 ‘‘(B) 4 shall be individuals distinguished in

5 the practice of medicine of which at least 1

6 shall be a primary care practitioner;

7 ‘‘(C) 3 shall be individuals distinguished in

8 the other health professions;

9 ‘‘(D) 4 shall be individuals either rep10 resenting the private healthcare sector, includ11 ing health plans, providers, and purchasers or

12 individuals distinguished as administrators of

13 healthcare delivery systems;

14 ‘‘(E) 4 shall be individuals distinguished in

15 the fields of healthcare quality improvement, ec16 onomics, information systems, law, ethics, busi17 ness, or public policy; and

18 ‘‘(F) 2 shall be individuals representing the

19 interests of patients and consumers of

20 healthcare.

21 ‘‘(3) EX OFFICIO MEMBERS.—The Secretary

22 shall designate as ex officio members of the Advisory

23 Council—

24 ‘‘(A) the Assistant Secretary for Health,

25 the Director of the National Institutes of
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1 Health, the Director of the Centers for Disease

2 Control and Prevention, the Administrator of

3 the Health Care Financing Administration, the

4 Assistant Secretary of Defense (Health Af5 fairs), and the Chief Medical Officer of the De6 partment of Veterans Affairs; and

7 ‘‘(B) such other Federal officials as the

8 Secretary may consider appropriate.

9 ‘‘(d) TERMS.—Members of the Advisory Council ap10 pointed under subsection (c)(2) shall serve for a term of

11 3 years. A member of the Council appointed under such

12 subsection may continue to serve after the expiration of

13 the term of the members until a successor is appointed.

14 ‘‘(e) VACANCIES.—If a member of the Advisory

15 Council appointed under subsection (c)(2) does not serve

16 the full term applicable under subsection (d), the individ17 ual appointed to fill the resulting vacancy shall be ap18 pointed for the remainder of the term of the predecessor

19 of the individual.

20 ‘‘(f) CHAIR.—The Director shall, from among the

21 members of the Advisory Council appointed under sub22 section (c)(2), designate an individual to serve as the chair

23 of the Advisory Council.

24 ‘‘(g) MEETINGS.—The Advisory Council shall meet

25 not less than once during each discrete 4-month period
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1 and shall otherwise meet at the call of the Director or the

2 chair.

3 ‘‘(h) COMPENSATION AND REIMBURSEMENT OF EX4 PENSES.—

5 ‘‘(1) APPOINTED MEMBERS.—Members of the

6 Advisory Council appointed under subsection (c)(2)

7 shall receive compensation for each day (including

8 travel time) engaged in carrying out the duties of

9 the Advisory Council unless declined by the member.

10 Such compensation may not be in an amount in ex11 cess of the maximum rate of basic pay payable for

12 GS–18 of the General Schedule.

13 ‘‘(2) EX OFFICIO MEMBERS.—Officials des14 ignated under subsection (c)(3) as ex officio mem15 bers of the Advisory Council may not receive com16 pensation for service on the Advisory Council in ad17 dition to the compensation otherwise received for du18 ties carried out as officers of the United States.

19 ‘‘(i) STAFF.—The Director shall provide to the Advi20 sory Council such staff, information, and other assistance

21 as may be necessary to carry out the duties of the Council.

22 ‘‘SEC. 922. PEER REVIEW WITH RESPECT TO GRANTS AND

23 CONTRACTS.

24 ‘‘(a) REQUIREMENT OF REVIEW.—
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1 ‘‘(1) IN GENERAL.—Appropriate technical and

2 scientific peer review shall be conducted with respect

3 to each application for a grant, cooperative agree4 ment, or contract under this title.

5 ‘‘(2) REPORTS TO DIRECTOR.—Each peer re6 view group to which an application is submitted pur7 suant to paragraph (1) shall report its finding and

8 recommendations respecting the application to the

9 Director in such form and in such manner as the

10 Director shall require.

11 ‘‘(b) APPROVAL AS PRECONDITION OF AWARDS.—

12 The Director may not approve an application described in

13 subsection (a)(1) unless the application is recommended

14 for approval by a peer review group established under sub15 section (c).

16 ‘‘(c) ESTABLISHMENT OF PEER REVIEW GROUPS.—

17 ‘‘(1) IN GENERAL.—The Director shall establish

18 such technical and scientific peer review groups as

19 may be necessary to carry out this section. Such

20 groups shall be established without regard to the

21 provisions of title 5, United States Code, that govern

22 appointments in the competitive service, and without

23 regard to the provisions of chapter 51, and sub24 chapter III of chapter 53, of such title that relate
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1 to classification and pay rates under the General

2 Schedule.

3 ‘‘(2) MEMBERSHIP.—The members of any peer

4 review group established under this section shall be

5 appointed from among individuals who by virtue of

6 their training or experience are eminently qualified

7 to carry out the duties of such peer review group.

8 Officers and employees of the United States may not

9 constitute more than 25 percent of the membership

10 of any such group. Such officers and employees may

11 not receive compensation for service on such groups

12 in addition to the compensation otherwise received

13 for these duties carried out as such officers and em14 ployees.

15 ‘‘(3) DURATION.—Notwithstanding section

16 14(a) of the Federal Advisory Committee Act, peer

17 review groups established under this section may

18 continue in existence until otherwise provided by

19 law.

20 ‘‘(4) QUALIFICATIONS.—Members of any peer21 review group shall, at a minimum, meet the follow22 ing requirements:

23 ‘‘(A) Such members shall agree in writing

24 to treat information received, pursuant to their

25 work for the group, as confidential information,
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1 except that this subparagraph shall not apply to

2 public records and public information.

3 ‘‘(B) Such members shall agree in writing

4 to recuse themselves from participation in the

5 peer-review of specific applications which

6 present a potential personal conflict of interest

7 or appearance of such conflict, including em8 ployment in a directly affected organization,

9 stock ownership, or any financial or other ar10 rangement that might introduce bias in the

11 process of peer-review.

12 ‘‘(d) AUTHORITY FOR PROCEDURAL ADJUSTMENTS

13 IN CERTAIN CASES.—In the case of applications for finan14 cial assistance whose direct costs will not exceed $100,000,

15 the Director may make appropriate adjustments in the

16 procedures otherwise established by the Director for the

17 conduct of peer review under this section. Such adjust18 ments may be made for the purpose of encouraging the

19 entry of individuals into the field of research, for the pur20 pose of encouraging clinical practice-oriented or provider21 based research, and for such other purposes as the Direc22 tor may determine to be appropriate.

23 ‘‘(e) REGULATIONS.—The Director shall issue regula24 tions for the conduct of peer review under this section.
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1 ‘‘SEC. 923. CERTAIN PROVISIONS WITH RESPECT TO DEVEL2 OPMENT, COLLECTION, AND DISSEMINATION

3 OF DATA.

4 ‘‘(a) STANDARDS WITH RESPECT TO UTILITY OF

5 DATA.—

6 ‘‘(1) IN GENERAL.—To ensure the utility, accu7 racy, and sufficiency of data collected by or for the

8 Agency for the purpose described in section 901(b),

9 the Director shall establish standards and methods

10 for developing and collecting such data, taking into

11 consideration—

12 ‘‘(A) other Federal health data collection

13 standards; and

14 ‘‘(B) the differences between types of

15 healthcare plans, delivery systems, healthcare

16 providers, and provider arrangements.

17 ‘‘(2) RELATIONSHIP WITH OTHER DEPARTMENT

18 PROGRAMS.—In any case where standards under

19 paragraph (1) may affect the administration of other

20 programs carried out by the Department of Health

21 and Human Services, including the programs under

22 titles XVIII, XIX and XXI of the Social Security

23 Act, they shall be in the form of recommendations

24 to the Secretary for such program.

25 ‘‘(b) STATISTICS AND ANALYSES.—The Director

26 shall—
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1 ‘‘(1) take appropriate action to ensure that sta2 tistics and analyses developed under this title are of

3 high quality, timely, and duly comprehensive, and

4 that the statistics are specific, standardized, and

5 adequately analyzed and indexed; and

6 ‘‘(2) publish, make available, and disseminate

7 such statistics and analyses on as wide a basis as is

8 practicable.

9 ‘‘(c) AUTHORITY REGARDING CERTAIN REQUESTS.—

10 Upon request of a public or private entity, the Director

11 may conduct or support research or analyses otherwise au12 thorized by this title pursuant to arrangements under

13 which such entity will pay the cost of the services provided.

14 Amounts received by the Director under such arrange15 ments shall be available to the Director for obligation until

16 expended.

17 ‘‘SEC. 924. DISSEMINATION OF INFORMATION.

18 ‘‘(a) IN GENERAL.—The Director shall—

19 ‘‘(1) without regard to section 501 of title 44,

20 United States Code, promptly publish, make avail21 able, and otherwise disseminate, in a form under22 standable and on as broad a basis as practicable so

23 as to maximize its use, the results of research, dem24 onstration projects, and evaluations conducted or

25 supported under this title;
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1 ‘‘(2) ensure that information disseminated by

2 the Agency is science-based and objective and under3 takes consultation as necessary to assess the appro4 priateness and usefulness of the presentation of in5 formation that is targeted to specific audiences;

6 ‘‘(3) promptly make available to the public data

7 developed in such research, demonstration projects,

8 and evaluations;

9 ‘‘(4) provide, in collaboration with the National

10 Library of Medicine where appropriate, indexing, ab11 stracting, translating, publishing, and other services

12 leading to a more effective and timely dissemination

13 of information on research, demonstration projects,

14 and evaluations with respect to healthcare to public

15 and private entities and individuals engaged in the

16 improvement of healthcare delivery and the general

17 public, and undertake programs to develop new or

18 improved methods for making such information

19 available; and

20 ‘‘(5) as appropriate, provide technical assistance

21 to State and local government and health agencies

22 and conduct liaison activities to such agencies to fos23 ter dissemination.

24 ‘‘(b) PROHIBITION AGAINST RESTRICTIONS.—Except

25 as provided in subsection (c), the Director may not restrict
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1 the publication or dissemination of data from, or the re2 sults of, projects conducted or supported under this title.

3 ‘‘(c) LIMITATION ON USE OF CERTAIN INFORMA4 TION.—No information, if an establishment or person sup5 plying the information or described in it is identifiable,

6 obtained in the course of activities undertaken or sup7 ported under this title may be used for any purpose other

8 than the purpose for which it was supplied unless such

9 establishment or person has consented (as determined

10 under regulations of the Secretary) to its use for such

11 other purpose. Such information may not be published or

12 released in other form if the person who supplied the infor13 mation or who is described in it is identifiable unless such

14 person has consented (as determined under regulations of

15 the Secretary) to its publication or release in other form.

16 ‘‘(d) PENALTY.—Any person who violates subsection

17 (c) shall be subject to a civil monetary penalty of not more

18 than $10,000 for each such violation involved. Such pen19 alty shall be imposed and collected in the same manner

20 as civil money penalties under subsection (a) of section

21 1128A of the Social Security Act are imposed and col22 lected.
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1 ‘‘SEC. 925. ADDITIONAL PROVISIONS WITH RESPECT TO

2 GRANTS AND CONTRACTS.

3 ‘‘(a) FINANCIAL CONFLICTS OF INTEREST.—With

4 respect to projects for which awards of grants, cooperative

5 agreements, or contracts are authorized to be made under

6 this title, the Director shall by regulation define—

7 ‘‘(1) the specific circumstances that constitute

8 financial interests in such projects that will, or may

9 be reasonably expected to, create a bias in favor of

10 obtaining results in the projects that are consistent

11 with such interests; and

12 ‘‘(2) the actions that will be taken by the Direc13 tor in response to any such interests identified by

14 the Director.

15 ‘‘(b) REQUIREMENT OF APPLICATION.—The Director

16 may not, with respect to any program under this title au17 thorizing the provision of grants, cooperative agreements,

18 or contracts, provide any such financial assistance unless

19 an application for the assistance is submitted to the Sec20 retary and the application is in such form, is made in such

21 manner, and contains such agreements, assurances, and

22 information as the Director determines to be necessary to

23 carry out the program involved.

24 ‘‘(c) PROVISION OF SUPPLIES AND SERVICES IN

25 LIEU OF FUNDS.—
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1 ‘‘(1) IN GENERAL.—Upon the request of an en2 tity receiving a grant, cooperative agreement, or con3 tract under this title, the Secretary may, subject to

4 paragraph (2), provide supplies, equipment, and

5 services for the purpose of aiding the entity in carry6 ing out the project involved and, for such purpose,

7 may detail to the entity any officer or employee of

8 the Department of Health and Human Services.

9 ‘‘(2) CORRESPONDING REDUCTION IN FUNDS.—

10 With respect to a request described in paragraph

11 (1), the Secretary shall reduce the amount of the fi12 nancial assistance involved by an amount equal to

13 the costs of detailing personnel and the fair market

14 value of any supplies, equipment, or services pro15 vided by the Director. The Secretary shall, for the

16 payment of expenses incurred in complying with

17 such request, expend the amounts withheld.

18 ‘‘(d) APPLICABILITY OF CERTAIN PROVISIONS WITH

19 RESPECT TO CONTRACTS.—Contracts may be entered into

20 under this part without regard to sections 3648 and 3709

21 of the Revised Statutes (31 U.S.C. 529; 41 U.S.C. 5).

22 ‘‘SEC. 926. CERTAIN ADMINISTRATIVE AUTHORITIES.

23 ‘‘(a) DEPUTY DIRECTOR AND OTHER OFFICERS AND

24 EMPLOYEES.—
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1 ‘‘(1) DEPUTY DIRECTOR.—The Director may

2 appoint a deputy director for the Agency.

3 ‘‘(2) OTHER OFFICERS AND EMPLOYEES.—The

4 Director may appoint and fix the compensation of

5 such officers and employees as may be necessary to

6 carry out this title. Except as otherwise provided by

7 law, such officers and employees shall be appointed

8 in accordance with the civil service laws and their

9 compensation fixed in accordance with title 5,

10 United States Code.

11 ‘‘(b) FACILITIES.—The Secretary, in carrying out

12 this title—

13 ‘‘(1) may acquire, without regard to the Act of

14 March 3, 1877 (40 U.S.C. 34), by lease or otherwise

15 through the Director of General Services, buildings

16 or portions of buildings in the District of Columbia

17 or communities located adjacent to the District of

18 Columbia for use for a period not to exceed 10

19 years; and

20 ‘‘(2) may acquire, construct, improve, repair,

21 operate, and maintain laboratory, research, and

22 other necessary facilities and equipment, and such

23 other real or personal property (including patents)

24 as the Secretary deems necessary.
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1 ‘‘(c) PROVISION OF FINANCIAL ASSISTANCE.—The

2 Director, in carrying out this title, may make grants to

3 public and nonprofit entities and individuals, and may

4 enter into cooperative agreements or contracts with public

5 and private entities and individuals.

6 ‘‘(d) UTILIZATION OF CERTAIN PERSONNEL AND RE7 SOURCES.—

8 ‘‘(1) DEPARTMENT OF HEALTH AND HUMAN

9 SERVICES.—The Director, in carrying out this title,

10 may utilize personnel and equipment, facilities, and

11 other physical resources of the Department of

12 Health and Human Services, permit appropriate (as

13 determined by the Secretary) entities and individuals

14 to utilize the physical resources of such Department,

15 and provide technical assistance and advice.

16 ‘‘(2) OTHER AGENCIES.—The Director, in car17 rying out this title, may use, with their consent, the

18 services, equipment, personnel, information, and fa19 cilities of other Federal, State, or local public agen20 cies, or of any foreign government, with or without

21 reimbursement of such agencies.

22 ‘‘(e) CONSULTANTS.—The Secretary, in carrying out

23 this title, may secure, from time to time and for such peri24 ods as the Director deems advisable but in accordance

25 with section 3109 of title 5, United States Code, the as-
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1 sistance and advice of consultants from the United States

2 or abroad.

3 ‘‘(f) EXPERTS.—

4 ‘‘(1) IN GENERAL.—The Secretary may, in car5 rying out this title, obtain the services of not more

6 than 50 experts or consultants who have appropriate

7 scientific or professional qualifications. Such experts

8 or consultants shall be obtained in accordance with

9 section 3109 of title 5, United States Code, except

10 that the limitation in such section on the duration

11 of service shall not apply.

12 ‘‘(2) TRAVEL EXPENSES.—

13 ‘‘(A) IN GENERAL.—Experts and consult14 ants whose services are obtained under para15 graph (1) shall be paid or reimbursed for their

16 expenses associated with traveling to and from

17 their assignment location in accordance with

18 sections 5724, 5724a(a), 5724a(c), and

19 5726(C) of title 5, United States Code.

20 ‘‘(B) LIMITATION.—Expenses specified in

21 subparagraph (A) may not be allowed in con22 nection with the assignment of an expert or

23 consultant whose services are obtained under

24 paragraph (1) unless and until the expert

25 agrees in writing to complete the entire period
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1 of assignment, or 1 year, whichever is shorter,

2 unless separated or reassigned for reasons that

3 are beyond the control of the expert or consult4 ant and that are acceptable to the Secretary. If

5 the expert or consultant violates the agreement,

6 the money spent by the United States for the

7 expenses specified in subparagraph (A) is recov8 erable from the expert or consultant as a statu9 tory obligation owed to the United States. The

10 Secretary may waive in whole or in part a right

11 of recovery under this subparagraph.

12 ‘‘(g) VOLUNTARY AND UNCOMPENSATED SERV13 ICES.—The Director, in carrying out this title, may accept

14 voluntary and uncompensated services.

15 ‘‘SEC. 927. FUNDING.

16 ‘‘(a) INTENT.—To ensure that the United States’s in17 vestment in biomedical research is rapidly translated into

18 improvements in the quality of patient care, there must

19 be a corresponding investment in research on the most ef20 fective clinical and organizational strategies for use of

21 these findings in daily practice. The authorization levels

22 in subsections (b) and (c) provide for a proportionate in23 crease in healthcare research as the United State’s invest24 ment in biomedical research increases.
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1 ‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—For the

2 purpose of carrying out this title, there are authorized to

3 be appropriated $185,000,000 for fiscal year 2000, and

4 such sums as may be necessary for each of the fiscal years

5 2001 through 2006.

6 ‘‘(c) EVALUATIONS.—In addition to amounts avail7 able pursuant to subsection (b) for carrying out this title,

8 there shall be made available for such purpose, from the

9 amounts made available pursuant to section 241 (relating

10 to evaluations), an amount equal to 40 percent of the max11 imum amount authorized in such section 241 to be made

12 available for a fiscal year.

13 ‘‘SEC. 929. DEFINITIONS.

14 ‘‘In this title:

15 ‘‘(1) ADVISORY COUNCIL.—The term ‘Advisory

16 Council’ means the Advisory Council on Healthcare

17 Research and Quality established under section 921.

18 ‘‘(2) AGENCY.—The term ‘Agency’ means the

19 Agency for Healthcare Research and Quality.

20 ‘‘(3) DIRECTOR.—The term ‘Director’ means

21 the Director for the Agency for Healthcare Research

22 and Quality.’’.

23 SEC. 403. REFERENCES.

24 Effective upon the date of enactment of this Act, any

25 reference in law to the ‘‘Agency for Health Care Policy
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1 and Research’’ shall be deemed to be a reference to the

2 ‘‘Agency for Healthcare Research and Quality’’.

3 SEC. 404. STUDY.

4 (a) STUDY.—Not later than 30 days after the date

5 of enactment of any Act providing for a qualifying health

6 care benefit (as defined in subsection (b), the Secretary

7 of Health and Human Services, in consultation with the

8 Agency for Healthcare Research and Quality, the National

9 Institutes of Health, and the Institute of Medicine, shall

10 conduct a study concerning such benefit that scientifically

11 evaluates—

12 (1) the safety and efficacy of the benefit, par13 ticularly the effect of the benefit on outcomes of

14 care;

15 (2) the cost, benefits and value of such benefit;

16 (3) the benefit in comparison to alternative ap17 proaches in improving care; and

18 (4) the overall impact that such benefit will

19 have on health care as measured through research.

20 (b) QUALIFYING HEALTH CARE BENEFIT.—In this

21 section, the term ‘‘qualifying health care benefit’’ means

22 a health care benefit that—

23 (1) is disease- or health condition-specific;

24 (2) requires the provision of or coverage for

25 health care items or services;
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1 (3) applies to group health plan, individual

2 health plans, or health insurance issuers under part

3 7 of subtitle B of title I of the Employee Retirement

4 Income Security Act of 1974 (29 U.S.C. 1181 et

5 seq.) or under title XXVII of the Public Health

6 Service Act (42 U.S.C. 300gg et seq.); and

7 (4) was provided under an Act (or amendment)

8 enacted on or after January 1, 1999.

9 (c) REPORTS.—Not later than 3 years after the date

10 of enactment of any Act described in subsection (a), the

11 Secretary of Health and Human Services shall prepare

12 and submit to the appropriate committees of Congress a

13 report based on the study conducted under such sub14 section with respect to the qualifying health care benefit

15 involved.

16 TITLE V—ENHANCED ACCESS TO

17 HEALTH INSURANCE COVERAGE

18 SEC. 501. FULL DEDUCTION OF HEALTH INSURANCE COSTS

19 FOR SELF-EMPLOYED INDIVIDUALS.

20 (a) IN GENERAL.—Section 162(l)(1) of the Internal

21 Revenue Code of 1986 (relating to allowance of deduc22 tions) is amended to read as follows:

23 ‘‘(1) ALLOWANCE OF DEDUCTION.—In the case

24 of an individual who is an employee within the

25 meaning of section 401(c)(1), there shall be allowed
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1 as a deduction under this section an amount equal

2 to the amount paid during the taxable year for in3 surance which constitutes medical care for the tax4 payer, his spouse, and his dependents.’’

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

6 this section shall apply to taxable years beginning after

7 December 31, 1999.

8 SEC. 502. FULL AVAILABILITY OF MEDICAL SAVINGS AC9 COUNTS.

10 (a) AVAILABILITY NOT LIMITED TO ACCOUNTS FOR

11 EMPLOYEES OF SMALL EMPLOYERS AND SELF-EM12 PLOYED INDIVIDUALS.—

13 (1) IN GENERAL.—Section 220(c)(1)(A) of the

14 Internal Revenue Code of 1986 (relating to eligible

15 individual) is amended to read as follows:

16 ‘‘(A) IN GENERAL.—The term ‘eligible in17 dividual’ means, with respect to any month, any

18 individual if—

19 ‘‘(i) such individual is covered under a

20 high deductible health plan as of the 1st

21 day of such month, and

22 ‘‘(ii) such individual is not, while cov23 ered under a high deductible health plan,

24 covered under any health plan—
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1 ‘‘(I) which is not a high deduct2 ible health plan, and

3 ‘‘(II) which provides coverage for

4 any benefit which is covered under the

5 high deductible health plan.’’.

6 (2) CONFORMING AMENDMENTS.—

7 (A) Section 220(c)(1) of such Code is

8 amended by striking subparagraphs (C) and

9 (D).

10 (B) Section 220(c) of such Code is amend11 ed by striking paragraph (4) (defining small

12 employer) and by redesignating paragraph (5)

13 as paragraph (4).

14 (C) Section 220(b) of such Code is amend15 ed by striking paragraph (4) (relating to deduc16 tion limited by compensation) and by redesig17 nating paragraphs (5), (6), and (7) as para18 graphs (4), (5), and (6), respectively.

19 (b) REMOVAL OF LIMITATION ON NUMBER OF TAX20 PAYERS HAVING MEDICAL SAVINGS ACCOUNTS.—

21 (1) IN GENERAL.—Section 220 of the Internal

22 Revenue Code of 1986 (relating to medical savings

23 accounts) is amended by striking subsections (i) and

24 (j).
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1 (2) MEDICARE+CHOICE.—Section 138 of such

2 Code (relating to Medicare+Choice MSA) is amend3 ed by striking subsection (f).

4 (c) REDUCTION IN HIGH DEDUCTIBLE PLAN MINI5 MUM ANNUAL DEDUCTIBLE.—Section 220(c)(2)(A) of the

6 Internal Revenue Code of 1986 (relating to high deduct7 ible health plan) is amended—

8 (1) by striking ‘‘$1,500’’ in clause (i) and in9 serting ‘‘$1,000’’, and

10 (2) by striking ‘‘$3,000’’ in clause (ii) and in11 serting ‘‘$2,000’’.

12 (d) INCREASE IN CONTRIBUTION LIMIT TO 100 PER13 CENT OF ANNUAL DEDUCTIBLE.—

14 (1) IN GENERAL.—Section 220(b)(2) of the In15 ternal Revenue Code of 1986 (relating to monthly

16 limitation) is amended to read as follows:

17 ‘‘(2) MONTHLY LIMITATION.—The monthly limitation for any month is the amount equal to 1 18 ⁄12 of

19 the annual deductible of the high deductible health

20 plan of the individual.’’

21 (2) CONFORMING AMENDMENT.—Section

22 220(d)(1)(A) of such Code is amended by striking

23 ‘‘75 percent of’’.

24 (e) LIMITATION ON ADDITIONAL TAX ON DISTRIBU25 TIONS NOT USED FOR QUALIFIED MEDICAL EX-
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1 PENSES.—Section 220(f)(4) of the Internal Revenue Code

2 of 1986 (relating to additional tax on distributions not

3 used for qualified medical expenses) is amended by adding

4 at the end the following:

5 ‘‘(D) EXCEPTION IN CASE OF SUFFICIENT

6 ACCOUNT BALANCE.—Subparagraph (A) shall

7 not apply to any payment or distribution in any

8 taxable year, but only to the extent such pay9 ment or distribution does not reduce the fair

10 market value of the assets of the medical sav11 ings account to an amount less than the annual

12 deductible for the high deductible health plan of

13 the account holder (determined as of January 1

14 of the calendar year in which the taxable year

15 begins).’’.

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

17 this section shall apply to taxable years beginning after

18 December 31, 1999.

19 SEC. 503. CARRYOVER OF UNUSED BENEFITS FROM CAFE20 TERIA PLANS, FLEXIBLE SPENDING AR21 RANGEMENTS, AND HEALTH FLEXIBLE

22 SPENDING ACCOUNTS.

23 (a) IN GENERAL.—Section 125 of the Internal Reve24 nue Code of 1986 (relating to cafeteria plans) is amended

25 by redesignating subsections (h) and (i) as subsections (i)
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1 and (j) and by inserting after subsection (g) the following

2 new subsection:

3 ‘‘(h) ALLOWANCE OF CARRYOVERS OF UNUSED BEN4 EFITS TO LATER TAXABLE YEARS.—

5 ‘‘(1) IN GENERAL.—For purposes of this title—

6 ‘‘(A) notwithstanding subsection (d)(2), a

7 plan or other arrangement shall not fail to be

8 treated as a cafeteria plan or flexible spending

9 or similar arrangement, and

10 ‘‘(B) no amount shall be required to be in11 cluded in gross income by reason of this section

12 or any other provision of this chapter,

13 solely because under such plan or other arrangement

14 any nontaxable benefit which is unused as of the

15 close of a taxable year may be carried forward to 1

16 or more succeeding taxable years.

17 ‘‘(2) LIMITATION.—Paragraph (1) shall not

18 apply to amounts carried from a plan to the extent

19 such amounts exceed $500 (applied on an annual

20 basis). For purposes of this paragraph, all plans and

21 arrangements maintained by an employer or any re22 lated person shall be treated as 1 plan.

23 ‘‘(3) ALLOWANCE OF ROLLOVER.—

24 ‘‘(A) IN GENERAL.—In the case of any un25 used benefit described in paragraph (1) which
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1 consists of amounts in a health flexible spend2 ing account or dependent care flexible spending

3 account, the plan or arrangement shall provide

4 that a participant may elect, in lieu of such car5 ryover, to have such amounts distributed to the

6 participant.

7 ‘‘(B) AMOUNTS NOT INCLUDED IN IN8 COME.—Any distribution under subparagraph

9 (A) shall not be included in gross income to the

10 extent that such amount is transferred in a

11 trustee-to-trustee transfer, or is contributed

12 within 60 days of the date of the distribution,

13 to—

14 ‘‘(i) a qualified cash or deferred ar15 rangement described in section 401(k),

16 ‘‘(ii) a plan under which amounts are

17 contributed by an individual’s employer for

18 an annuity contract described in section

19 403(b),

20 ‘‘(iii) an eligible deferred compensa21 tion plan described in section 457, or

22 ‘‘(iv) a medical savings account (with23 in the meaning of section 220).

24 Any amount rolled over under this subpara25 graph shall be treated as a rollover contribution
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1 for the taxable year from which the unused

2 amount would otherwise be carried.

3 ‘‘(C) TREATMENT OF ROLLOVER.—Any

4 amount rolled over under subparagraph (B)

5 shall be treated as an eligible rollover under

6 section 220, 401(k), 403(b), or 457, whichever

7 is applicable, and shall be taken into account in

8 applying any limitation (or participation re9 quirement) on employer or employee contribu10 tions under such section or any other provision

11 of this chapter for the taxable year of the roll12 over.

13 ‘‘(4) COST-OF-LIVING ADJUSTMENT.—In the

14 case of any taxable year beginning in a calendar

15 year after 1999, the $500 amount under paragraph

16 (2) shall be adjusted at the same time and in the

17 same manner as under section 415(d)(2), except

18 that the base period taken into account shall be the

19 calendar quarter beginning October 1, 1998, and

20 any increase which is not a multiple of $50 shall be

21 rounded to the next lowest multiple of $50.’’

22 ‘‘(5) APPLICABILITY.—This subsection shall

23 apply to taxable years beginning after December 31,

24 1999.’’
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1 (b) EFFECTIVE DATE.—The amendments made by

2 this section shall apply to taxable years beginning after

3 December 31, 1999.

4 SEC. 504. PERMITTING CONTRIBUTION TOWARDS MEDICAL

5 SAVINGS ACCOUNT THROUGH FEDERAL EM6 PLOYEES HEALTH BENEFITS PROGRAM

7 (FEHBP).

8 (a) GOVERNMENT CONTRIBUTION TO MEDICAL SAV9 INGS ACCOUNT.—

10 (1) IN GENERAL.—Section 8906 of title 5,

11 United States Code, is amended by adding at the

12 end the following:

13 ‘‘(j)(1) In the case of an employee or annuitant who

14 is enrolled in a catastrophic plan described by section

15 8903(5), there shall be a Government contribution under

16 this subsection to a medical savings account established

17 or maintained for the benefit of the individual. The con18 tribution under this subsection shall be in addition to the

19 Government contribution under subsection (b).

20 ‘‘(2) The amount of the Government contribution

21 under this subsection with respect to an individual is equal

22 to the amount by which—

23 ‘‘(A) the maximum contribution allowed under

24 subsection (b)(1) with respect to any employee or

25 annuitant, exceeds
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1 ‘‘(B) the amount of the Government contribu2 tion actually made with respect to the individual

3 under subsection (b) for coverage under the cata4 strophic plan.

5 ‘‘(3) The Government contributions under this sub6 section shall be paid into a medical savings account (des7 ignated by the individual involved) in a manner that is

8 specified by the Office and consistent with the timing of

9 contributions under subsection (b).

10 ‘‘(4) Subsections (f) and (g) shall apply to contribu11 tions under this section in the same manner as they apply

12 to contributions under subsection (b).

13 ‘‘(5) For the purpose of this subsection, the term

14 ‘medical savings account’ has the meaning given such term

15 by section 220(d) of the Internal Revenue Code of 1986.’’.

16 (2) ALLOWING PAYMENT OF FULL AMOUNT OF

17 CHARGE FOR CATASTROPHIC PLAN.—Section

18 8906(b)(2) of such title is amended by inserting ‘‘(or

19 100 percent of the subscription charge in the case

20 of a catastrophic plan)’’ after ‘‘75 percent of the

21 subscription charge’’.

22 (b) OFFERING OF CATASTROPHIC PLANS.—

23 (1) IN GENERAL.—Section 8903 of title 5,

24 United States Code, is amended by adding at the

25 end the following:
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1 ‘‘(5) CATASTROPHIC PLANS.—One or more

2 plans described in paragraph (1), (2), or (3), but

3 which provide benefits of the types referred to by

4 paragraph (5) of section 8904(a), instead of the

5 types referred to in paragraphs (1), (2), and (3) of

6 such section.’’.

7 (2) TYPES OF BENEFITS.—Section 8904(a) of

8 such title is amended by inserting after paragraph

9 (4) the following new paragraph:

10 ‘‘(5) CATASTROPHIC PLANS.—Benefits of the

11 types named under paragraph (1) or (2) of this sub12 section or both, to the extent expenses covered by

13 the plan exceed $500.’’.

14 (3) DETERMINING LEVEL OF GOVERNMENT

15 CONTRIBUTIONS.—Section 8906(b) of such title is

16 amended by adding at the end the following: ‘‘Sub17 scription charges for medical savings accounts shall

18 be deemed to be the amount of Government con19 tributions made under subsection (j)(2).’’.

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

21 this section shall apply to contract terms beginning on or

22 after January 1, 2000.

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