II

106TH CONGRESS

1ST SESSION S. 374

To amend the Public Health Service Act, the Employee Retirement Income

Security Act of 1974, and the Internal Revenue Code of 1986 to protect

consumers in managed care plans and other health coverage.

IN THE SENATE OF THE UNITED STATES

FEBRUARY 4, 1999

Mr. CHAFEE (for himself, Mr. GRAHAM, Mr. LIEBERMAN, Mr. SPECTER, Mr.

BAUCUS, Mr. ROBB and Mr. BAYH) introduced the following bill; which

was read twice and referred to the Committee on Health, Education,

Labor, and Pensions

A BILL

To amend the Public Health Service Act, the Employee Retirement Income Security Act of 1974, and the Internal

Revenue Code of 1986 to protect consumers in managed

care plans and other health coverage.

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 ‘‘Promoting Responsible Managed Care Act of 1999’’.

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

7 this Act is as follows:
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Sec. 1. Short title; table of contents.

Sec. 2. Definitions.

Sec. 3. Preemption; State flexibility; construction.

Sec. 4. Regulations.

TITLE I—PROMOTING RESPONSIBLE MANAGED CARE

Subtitle A—Grievance and Appeals

Sec. 101. Definitions and general provisions relating to grievance and appeals.

Sec. 102. Utilization review activities.

Sec. 103. Establishment of process for grievances.

Sec. 104. Coverage determinations.

Sec. 105. Internal appeals (reconsiderations).

Sec. 106. External appeals (reviews).

Subtitle B—Consumer Information

Sec. 111. Health plan information.

Sec. 112. Health care quality information.

Sec. 113. Confidentiality and accuracy of enrollee records.

Sec. 114. Quality assurance.

Subtitle C—Patient Protection Standards

Sec. 121. Emergency services.

Sec. 122. Enrollee choice of health professionals and providers.

Sec. 123. Access to approved services.

Sec. 124. Nondiscrimination in delivery of services.

Sec. 125. Prohibition of interference with certain medical communications.

Sec. 126. Provider incentive plans.

Sec. 127. Provider participation.

Sec. 128. Required coverage for appropriate hospital stay for mastectomies and

lymph node dissections for the treatment of breast cancer.

Sec. 129. Promoting good medical practice.

Subtitle D—Enhanced Enforcement Authority

Sec. 141. Investigations and reporting authority, injunctive relief authority, and

increased civil money penalty authority for Secretary of Health

and Human Services for violations of patient protection standards.

Sec. 142. Authority for Secretary of Labor to impose civil penalties for violations of patient protection standards.

TITLE II—PATIENT PROTECTION STANDARDS UNDER THE

PUBLIC HEALTH SERVICE ACT

Sec. 201. Application to group health plans and group health insurance coverage.

Sec. 202. Application to individual health insurance coverage.

TITLE III—PATIENT PROTECTION STANDARDS UNDER THE

EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974

Sec. 301. Application of patient protection standards to group health plans and

group health insurance coverage under the Employee Retirement Income Security Act of 1974.
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Sec. 302. Enforcement for economic loss caused by coverage determinations.

TITLE IV—PATIENT PROTECTION STANDARDS UNDER THE

INTERNAL REVENUE CODE OF 1986

Sec. 401. Amendments to the Internal Revenue Code of 1986.

TITLE V—EFFECTIVE DATES; COORDINATION IN

IMPLEMENTATION

Sec. 501. Effective dates.

Sec. 502. Coordination in implementation.

1 SEC. 2. DEFINITIONS.

2 (a) INCORPORATION OF GENERAL DEFINITIONS.—

3 The provisions of section 2971 of the Public Health Serv4 ice Act shall apply for purposes of this section, section

5 3, and title I in the same manner as they apply for pur6 poses of title XXVII of such Act.

7 (b) SECRETARY.—Except as otherwise provided, for

8 purposes of this section and title I, the term ‘‘Secretary’’

9 means the Secretary of Health and Human Services, in

10 consultation with the Secretary of Labor and the Sec11 retary of the Treasury, and the term ‘‘appropriate Sec12 retary’’ means the Secretary of Health and Human Serv13 ices in relation to carrying out title I under sections 2707

14 and 2751 of the Public Health Service Act, the Secretary

15 of Labor in relation to carrying out title I under section

16 714 of the Employee Retirement Income Security Act of

17 1974, and the Secretary of the Treasury in relation to car18 rying out title I under chapter 100 and section 4980D

19 of the Internal Revenue Code of 1986.
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1 (c) ADDITIONAL DEFINITIONS.—For purposes of this

2 section and title I:

3 (1) APPLICABLE AUTHORITY.—The term ‘‘ap4 plicable authority’’ means—

5 (A) in the case of a group health plan, the

6 Secretary of Health and Human Services and

7 the Secretary of Labor; and

8 (B) in the case of a health insurance issuer

9 with respect to a specific provision of title I, the

10 applicable State authority (as defined in section

11 2791(d) of the Public Health Service Act), or

12 the Secretary of Health and Human Services, if

13 such Secretary is enforcing such specific provi14 sion under section 2722(a)(2) or 2761(a)(2) of

15 the Public Health Service Act.

16 (2) CLINICAL PEER.—The term ‘‘clinical peer’’

17 means, with respect to a review or appeal, a physi18 cian (allopathic or osteopathic) or other health care

19 professional who holds a non-restricted license in a

20 State and who is appropriately credentialed, li21 censed, certified, or accredited in the same or similar

22 specialty as manages (or typically manages) the

23 medical condition, procedure, or treatment under re24 view or appeal and includes a pediatric specialist

25 where appropriate; except that only a physician may
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1 be a clinical peer with respect to the review or ap2 peal of treatment rendered by a physician.

3 (3) HEALTH CARE PROVIDER.—The term

4 ‘‘health care provider’’ includes a physician or other

5 health care professional, as well as an institutional

6 provider of health care services.

7 (4) NONPARTICIPATING.—The term ‘‘non8 participating’’ means, with respect to a health care

9 provider that provides health care items and services

10 to a participant, beneficiary, or enrollee under a

11 group health plan or health insurance coverage, a

12 health care provider that is not a participating

13 health care provider with respect to such items and

14 services.

15 (5) PARTICIPATING.—The term ‘‘participating’’

16 means, with respect to a health care provider that

17 provides health care items and services to a partici18 pant, beneficiary, or enrollee under a group health

19 plan or health insurance coverage offered by a

20 health insurance issuer, a health care provider that

21 furnishes such items and services under a contract

22 or other arrangement with the plan or issuer.

23 SEC. 3. PREEMPTION; STATE FLEXIBILITY; CONSTRUCTION.

24 (a) CONTINUED APPLICABILITY OF STATE LAW

25 WITH RESPECT TO HEALTH INSURANCE ISSUERS.—
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1 (1) IN GENERAL.—Subject to paragraphs (2)

2 and (3), title I shall not be construed to supersede

3 any provision of State law which establishes, imple4 ments, or continues in effect any standard or re5 quirement solely relating to health insurance issuers

6 in connection with group health insurance coverage

7 except to the extent that such standard or require8 ment prevents the application of a requirement of

9 such title.

10 (2) CONTINUED PREEMPTION WITH RESPECT

11 TO GROUP HEALTH PLANS.—Nothing in title I shall

12 be construed to affect or modify the provisions of

13 section 514 of the Employee Retirement Income Se14 curity Act of 1974 with respect to group health

15 plans.

16 (3) CONSTRUCTION WITH RESPECT TO TIME

17 PERIODS.—Subject to paragraph (2), nothing in title

18 I shall be construed to prohibit a State from estab19 lishing, implementing, or continuing in effect any re20 quirement or standard that uses a shorter period of

21 time, than that provided under such title, for any in22 ternal or external appeals process to be used by

23 health insurance issuers.

24 (b) RULES OF CONSTRUCTION.—Nothing in title I

25 (other than section 128) shall be construed as requiring
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1 a group health plan or health insurance coverage to pro2 vide specific benefits under the terms of such plan or cov3 erage.

4 (c) DEFINITIONS.—For purposes of this section:

5 (1) STATE LAW.—The term ‘‘State law’’ in6 cludes all laws, decisions, rules, regulations, or other

7 State action having the effect of law, of any State.

8 A law of the United States applicable only to the

9 District of Columbia shall be treated as a State law

10 rather than a law of the United States.

11 (2) INCLUSION OF POLITICAL SUBDIVISIONS OF

12 A STATE.—The term ‘‘State’’ also includes any polit13 ical subdivisions of a State or any agency or instru14 mentality thereof.

15 (d) TREATMENT OF RELIGIOUS NONMEDICAL PRO16 VIDERS.—

17 (1) IN GENERAL.—Nothing in this Act (or the

18 amendments made thereby) shall be construed to—

19 (A) restrict or limit the right of group

20 health plans, and of health insurance issuers of21 fering health insurance coverage in connection

22 with group health plans, to include as providers

23 religious nonmedical providers;

24 (B) require such plans or issuers to—
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1 (i) utilize medically based eligibility

2 standards or criteria in deciding provider

3 status of religious nonmedical providers;

4 (ii) use medical professionals or cri5 teria to decide patient access to religious

6 nonmedical providers;

7 (iii) utilize medical professionals or

8 criteria in making decisions in internal or

9 external appeals from decisions denying or

10 limiting coverage for care by religious non11 medical providers; or

12 (iv) compel a participant or bene13 ficiary to undergo a medical examination

14 or test as a condition of receiving health

15 insurance coverage for treatment by a reli16 gious nonmedical provider; or

17 (C) require such plans or issuers to ex18 clude religious nonmedical providers because

19 they do not provide medical or other data other20 wise required, if such data is inconsistent with

21 the religious nonmedical treatment or nursing

22 care provided by the provider.

23 (2) RELIGIOUS NONMEDICAL PROVIDER.—For

24 purposes of this subsection, the term ‘‘religious non25 medical provider’’ means a provider who provides no
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1 medical care but who provides only religious non2 medical treatment or religious nonmedical nursing

3 care.

4 SEC. 4. REGULATIONS.

5 The Secretaries of Health and Human Services,

6 Labor, and the Treasury shall issue such regulations as

7 may be necessary or appropriate to carry out this Act.

8 Such regulations shall be issued consistent with section

9 104 of Health Insurance Portability and Accountability

10 Act of 1996. Such Secretaries may promulgate any in11 terim final rules as the Secretaries determine are appro12 priate to carry out this Act.

13 TITLE I—PROMOTING

14 RESPONSIBLE MANAGED CARE

15 Subtitle A—Grievance and Appeals

16 SEC. 101. DEFINITIONS AND GENERAL PROVISIONS RELAT17 ING TO GRIEVANCE AND APPEALS.

18 (a) DEFINITIONS.—In this subtitle:

19 (1) AUTHORIZED REPRESENTATIVE.—The term

20 ‘‘authorized representative’’ means, with respect to a

21 covered individual, an individual who—

22 (A) is—

23 (i) any treating health care profes24 sional of the covered individual (acting

25 within the scope of the professional’s li-
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1 cense or certification under applicable

2 State law), or

3 (ii) any legal representative of the

4 covered individual (or, in the case of a de5 ceased individual, the legal representative

6 of the estate of the individual),

7 regardless of whether such professional or rep8 resentative is affiliated with the plan or issuer

9 involved; and

10 (B) is acting on behalf of the covered indi11 vidual with the individual’s consent.

12 (2) COVERAGE DETERMINATION.—The term

13 ‘‘coverage determination’’ means any of the follow14 ing:

15 (A) A decision by a group health plan or

16 health insurance issuer as to whether to provide

17 benefits or payment for such benefits, including

18 such a decision resulting from the application of

19 utilization review (as defined in section

20 102(a)(3)) or relating to benefits required

21 under section 121 or 128.

22 (B) A decision of a group health plan or

23 health insurance issuer (or the failure of such

24 a plan or issuer) with respect to meeting a re-
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1 quirement described in section 122(a), 122(b),

2 122(c), 122(d), 123, or 124.

3 (C) Pursuant to section 104(d)(2), the fail4 ure of a group health plan or health insurance

5 issuer to provide timely notice under section

6 104(d).

7 (3) COVERED INDIVIDUAL.—The term ‘‘covered

8 individual’’ means an individual who is a participant

9 or beneficiary in a group health plan or an enrollee

10 in health insurance coverage offered by a health in11 surance issuer.

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

13 any complaint or dispute other than one involving a

14 coverage determination.

15 (5) RECONSIDERATION.—The term ‘‘reconsider16 ation’’ is defined in section 105(a)(7).

17 (6) UTILIZATION REVIEW.—The term ‘‘utiliza18 tion review’’ is defined in section 102(a)(3).

19 (b) SUMMARY OF RIGHTS OF INDIVIDUALS.—In ac20 cordance with the provisions of this subtitle, a covered in21 dividual has the following rights with respect to a group

22 health plan and with respect to a health insurance issuer

23 in connection with the provision of health insurance cov24 erage:
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1 (1) The right to have grievances between the

2 covered individual and the plan or issuer heard and

3 resolved as provided in section 103.

4 (2) The right to a timely coverage determina5 tion as provided in section 104.

6 (3) The right to request expedited treatment of

7 a coverage determination as provided in section

8 104(c).

9 (4) If dissatisfied with any part of a coverage

10 determination, the following appeal rights:

11 (A) The right to a timely reconsideration

12 of an adverse coverage determination as pro13 vided in section 105.

14 (B) The right to request expedited treat15 ment of such a reconsideration as provided in

16 section 105(c).

17 (C) If, as a result of a reconsideration of

18 the adverse coverage determination, the plan or

19 issuer affirms, in whole or in part, its adverse

20 coverage determination, the right to request

21 and receive a review of, and decision on, such

22 determination by a qualified external appeal en23 tity as provided in section 106.

24 (c) REQUIREMENTS.—
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1 (1) PROCEDURES.—A group health plan, and a

2 health insurance issuer in connection with the provi3 sion of health insurance coverage shall, with respect

4 to the provision of benefits under such plan or

5 coverage—

6 (A) establish and maintain—

7 (i) grievance procedures in accordance

8 with section 103;

9 (ii) procedures for coverage deter10 minations consistent with section 104; and

11 (iii) appeals procedures for adverse

12 coverage determinations in accordance with

13 sections 105 and 106; and

14 (B) provide for utilization review consistent

15 with section 102.

16 (2) DELEGATION.—A group health plan or a

17 health insurance issuer in connection with the provi18 sion of health insurance coverage that delegates any

19 of its responsibilities under this subtitle to another

20 entity or individual through which the plan or issuer

21 provides health care services shall ultimately be re22 sponsible for ensuring that such entity or individual

23 satisfies the relevant requirements of this subtitle.

24 SEC. 102. UTILIZATION REVIEW ACTIVITIES.

25 (a) COMPLIANCE WITH REQUIREMENTS.—
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1 (1) IN GENERAL.—A group health plan, and a

2 health insurance issuer in connection with the provi3 sion of health insurance coverage, shall conduct utili4 zation review activities in connection with the provi5 sion of benefits under such plan or coverage only in

6 accordance with a utilization review program that

7 meets the requirements of this section.

8 (2) USE OF OUTSIDE AGENTS.—Nothing in this

9 section shall be construed as preventing a group

10 health plan or health insurance issuer from arrang11 ing through a contract or otherwise for persons or

12 entities to conduct utilization review activities on be13 half of the plan or issuer, so long as such activities

14 are conducted in accordance with a utilization review

15 program that meets the requirements of this section.

16 (3) UTILIZATION REVIEW DEFINED.—For pur17 poses of this section, the terms ‘‘utilization review’’

18 and ‘‘utilization review activities’’ mean procedures

19 used to monitor or evaluate the clinical necessity,

20 appropriateness, efficacy, or efficiency of health care

21 services, procedures or settings, and includes pro22 spective review, concurrent review, second opinions,

23 case management, discharge planning, or retrospec24 tive review.

25 (b) WRITTEN POLICIES AND CRITERIA.—
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1 (1) WRITTEN POLICIES.—A utilization review

2 program shall be conducted consistent with written

3 policies and procedures that govern all aspects of the

4 program.

5 (2) USE OF WRITTEN CRITERIA.—

6 (A) IN GENERAL.—Such a program shall

7 utilize written clinical review criteria developed

8 pursuant to the program with the input of ap9 propriate physicians. Such criteria shall include

10 written clinical review criteria described in sec11 tion 114(b)(4)(B).

12 (B) CONTINUING USE OF STANDARDS IN

13 RETROSPECTIVE REVIEW.—If a health care

14 service has been specifically pre-authorized or

15 approved for a covered individual under such a

16 program, the program shall not, pursuant to

17 retrospective review, revise or modify the spe18 cific standards, criteria, or procedures used for

19 the utilization review for procedures, treatment,

20 and services delivered to the individual during

21 the same course of treatment.

22 (c) CONDUCT OF PROGRAM ACTIVITIES.—

23 (1) ADMINISTRATION BY HEALTH CARE PRO24 FESSIONALS.—
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1 (A) IN GENERAL.—A utilization review

2 program shall be administered by qualified

3 health care professionals who shall oversee re4 view decisions.

5 (B) HEALTH CARE PROFESSIONAL DE6 FINED.—In this section, the term ‘‘health care

7 professional’’ means a physician or other health

8 care practitioner licensed, accredited, or cer9 tified to perform specified health services con10 sistent with State law.

11 (2) USE OF QUALIFIED, INDEPENDENT PER12 SONNEL.—

13 (A) IN GENERAL.—A utilization review

14 program shall provide for the conduct of utiliza15 tion review activities only through personnel

16 who are qualified and, to the extent required,

17 who have received appropriate training in the

18 conduct of such activities under the program.

19 (B) PEER REVIEW OF SAMPLE OF AD20 VERSE CLINICAL DETERMINATIONS.—Such a

21 program shall provide that clinical peers (as de22 fined in section 2(c)(2)) shall evaluate the clini23 cal appropriateness of at least a sample of ad24 verse clinical determinations.
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1 (C) PROHIBITION OF CONTINGENT COM2 PENSATION ARRANGEMENTS.—Such a program

3 shall not, with respect to utilization review ac4 tivities, permit or provide compensation or any5 thing of value to its employees, agents, or con6 tractors in a manner that—

7 (i) provides direct or indirect incen8 tives for such persons to make inappropri9 ate review decisions; or

10 (ii) is based, directly or indirectly, on

11 the quantity or type of adverse determina12 tions rendered.

13 (D) PROHIBITION OF CONFLICTS.—Such a

14 program shall not permit a health care profes15 sional who provides health care services to a

16 covered individual to perform utilization review

17 activities in connection with the health care

18 services being provided to the individual. A

19 group health plan, or a health insurance issuer

20 in connection with the provision of health insur21 ance coverage, may not retaliate against a cov22 ered individual or health care provider based on

23 such individual’s or provider’s use of, or partici24 pation in, the utilization review program under

25 this section.
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1 (3) ACCESSIBILITY OF REVIEW.—Such a pro2 gram shall provide that appropriate personnel per3 forming utilization review activities under the pro4 gram are reasonably accessible by toll-free telephone

5 during normal business hours to discuss patient care

6 and allow response to telephone requests, and that

7 appropriate provision is made to receive and respond

8 promptly to calls received during other hours.

9 (4) LIMITS ON FREQUENCY.—Such a program

10 shall not provide for the performance of utilization

11 review activities with respect to a class of services

12 furnished to a covered individual more frequently

13 than is reasonably required to assess whether the

14 services under review are medically necessary or ap15 propriate.

16 (5) LIMITATION ON INFORMATION REQUESTS.—

17 Such a program shall provide that information shall

18 be required to be provided by health care providers

19 only to the extent it is necessary to perform the uti20 lization review activity involved.

21 (6) REVIEW OF PRELIMINARY UTILIZATION RE22 VIEW DECISION.—Such a program shall provide that

23 a covered individual who is dissatisfied with a pre24 liminary utilization review decision has the oppor25 tunity to discuss the decision with, and have such
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1 decision reviewed by, the medical director of the plan

2 or issuer involved (or the director’s designee) who

3 has the authority to reverse the decision.

4 SEC. 103. ESTABLISHMENT OF PROCESS FOR GRIEVANCES.

5 (a) ESTABLISHMENT.—A group health plan, and a

6 health insurance issuer in connection with the provision

7 of health insurance coverage, shall provide meaningful

8 procedures for timely hearing and resolution of grievances

9 brought by covered individuals regarding any aspect of the

10 plan’s or issuer’s services, including a decision not to expe11 dite a coverage determination or reconsideration under

12 section 104(c)(4)(B)(ii)(II) or 105(c)(4)(B)(ii)(II).

13 (b) GUIDELINES.—The grievance procedures re14 quired under subsection (a) shall meet all guidelines estab15 lished by the appropriate Secretary.

16 (c) DISTINGUISHED FROM COVERAGE DETERMINA17 TIONS AND APPEALS.—The grievance procedures required

18 under subsection (a) shall be separate and distinct from

19 procedures regarding coverage determinations under sec20 tion 104 and reconsiderations under section 105 and ex21 ternal reviews by a qualified external appeal entity under

22 section 106 (which address appeals of coverage determina23 tions).

24 SEC. 104. COVERAGE DETERMINATIONS.

25 (a) REQUIREMENT.—
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1 (1) RESPONSIBILITIES.—A group health plan,

2 and a health insurance issuer in connection with the

3 provision of health insurance coverage, shall estab4 lish and maintain procedures for making timely cov5 erage determinations (in accordance with the re6 quirements of this section) regarding the benefits a

7 covered individual is entitled to receive from the plan

8 or issuer, including the amount of any copayments,

9 deductibles, or other cost sharing applicable to such

10 benefits. Under this section, the plan or issuer shall

11 have a standard procedure for making such deter12 minations, and procedures for expediting such deter13 minations in cases in which application of the stand14 ard deadlines could seriously jeopardize the covered

15 individual’s life, health, or ability to regain or main16 tain maximum function or (in the case of a child

17 under the age of 6) development.

18 (2) PARTIES WHO MAY REQUEST COVERAGE

19 DETERMINATIONS.—Any of the following may re20 quest a coverage determination relating to a covered

21 individual and are parties to such determination:

22 (A) The covered individual.

23 (B) Any provider or other person acting on

24 behalf of the covered individual with the indi25 vidual’s consent.
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1 (3) EFFECT OF COVERAGE DETERMINATION.—

2 A coverage determination is binding on all parties

3 unless it is reconsidered pursuant to section 105 or

4 reviewed pursuant to section 106.

5 (b) NOTICE OF COVERAGE DETERMINATIONS.—

6 (1) IN GENERAL.—In the case of a request for

7 a coverage determination, the group health plan or

8 health insurance issuer shall provide notice pursuant

9 to subsection (c) to the person submitting the re10 quest of its determination as expeditiously as the

11 health condition of the covered individual involved

12 requires, but in no case later than deadline estab13 lished under paragraph (2) or (3) (as the case may

14 be) in the case of certain coverage determinations

15 described in such paragraphs.

16 (2) DEADLINE FOR COVERAGE DETERMINA17 TIONS INVOLVING PRIOR AUTHORIZATION SERVICES

18 AND CONTINUED CARE.—In the case of a coverage

19 determination described in section 101(a)(2)(A) in20 volving the prior authorization of health care items

21 and services for an individual or authorization for

22 continued or extended health care services for an in23 dividual, or additional services for an individual un24 dergoing a course of continued treatment prescribed

25 by a health care provider, the deadline established
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1 under this paragraph is 3 business days after the

2 date of receipt of information that is reasonably nec3 essary to make such determination.

4 (3) DEADLINE FOR PREVIOUSLY PROVIDED

5 SERVICES.—In the case of a coverage determination

6 (as so described) involving retrospective review of

7 health care services previously provided for an indi8 vidual, the deadline established under this paragraph

9 is 30 days of the date of receipt of information that

10 is reasonably necessary to make such determination.

11 (c) NOTICE OF COVERAGE DETERMINATIONS.—

12 (1) REQUIREMENT.—

13 (A) IN GENERAL.—A group health plan or

14 health insurance issuer that makes a coverage

15 determination that—

16 (i) is completely favorable to the cov17 ered individual shall provide the party sub18 mitting the request for the coverage deter19 mination with notice of such determina20 tion; or

21 (ii) is adverse, in whole or in part, to

22 the covered individual shall provide such

23 party with written notice of the determina24 tion, including the information described in

25 subparagraph (B).
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1 (B) CONTENT OF WRITTEN NOTICE.—A

2 written notice under subparagraph (A)(ii)

3 shall—

4 (i) provide the specific reasons for the

5 determination (including, in the case of a

6 determination relating to utilization review,

7 the clinical rationale for the determination)

8 in clear and understandable language;

9 (ii) include notice, in clear and under10 standable language, of the availability of

11 the clinical review criteria relied upon in

12 making the coverage determination;

13 (iii) describe, in clear and understand14 able language, the reconsideration and re15 view processes established to carry out sec16 tions 105 and 106, including the right to,

17 and conditions for, obtaining expedited

18 consideration of requests for reconsider19 ation or review; and

20 (iv) comply with any other require21 ments specified by the appropriate Sec22 retary.

23 (2) FAILURE TO PROVIDE TIMELY NOTICE.—

24 Any failure of a group health plan or health insur25 ance issuer to provide a covered individual with
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1 timely notice of a coverage determination as speci2 fied in this section shall constitute an adverse cov3 erage determination and a timely request for a re4 consideration with respect to such determination

5 shall be deemed to have been made pursuant to the

6 section 105(a)(2).

7 (3) PROVISION OF ORAL NOTICE WITH WRIT8 TEN CONFIRMATION IN CASE OF EXPEDITED TREAT9 MENT.—If a group health plan or health insurance

10 issuer grants a request for expedited treatment

11 under subsection (c), the plan or issuer may first

12 provide notice of the coverage determination orally

13 within the deadlines established under subsection

14 (b)(3) and then shall mail written confirmation of

15 the determination within 2 business days of the date

16 of oral notification.

17 SEC. 105. INTERNAL APPEALS (RECONSIDERATIONS).

18 (a) REQUIREMENT.—

19 (1) RESPONSIBILITIES.—A group health plan,

20 and a health insurance issuer in connection with the

21 provision of health insurance coverage, shall estab22 lish and maintain procedures for making timely re23 considerations of coverage determinations in accord24 ance with this section. Under this section, the plan

25 or issuer shall have a standard procedure for making
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1 such determinations, and procedures for expediting

2 such determinations in cases in which application of

3 the standard deadlines could seriously jeopardize the

4 covered individual’s life, health, or ability to regain

5 or maintain maximum function or (in the case of a

6 child under the age of 6) development.

7 (2) PARTIES WHO MAY REQUEST RECONSIDER8 ATION.—Any party to a coverage determination may

9 request a reconsideration of the determination under

10 this section. Such party shall submit an oral or writ11 ten request directly with the group health plan or

12 health insurance issuer that made the determination.

13 The party who files a request for reconsideration

14 may withdraw it by filing a written request for with15 drawal with the group health plan or health insur16 ance issuer involved.

17 (3) DEADLINE FOR FILING REQUEST.—

18 (A) IN GENERAL.—Except as provided in

19 subparagraph (B), a party to a coverage deter20 mination shall submit the request for a recon21 sideration within 60 calendar days from the

22 date of the written notice of the coverage deter23 mination.

24 (B) EXTENDING TIME FOR FILING RE25 QUEST.—Such a party may submit a written re-
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1 quest to the plan or issuer to extend the dead2 line specified in subparagraph (A). If such a

3 party demonstrates in the request for the exten4 sion good cause for such extension, the plan or

5 issuer may extend the deadline.

6 (4) PARTIES TO THE RECONSIDERATION.—

7 (A) IN GENERAL.—The parties to the re8 consideration are the parties to the coverage de9 termination, as described in section 104(a)(2),

10 and any other provider or entity (other than the

11 plan or issuer) whose rights with respect to the

12 coverage determination may be affected by the

13 reconsideration (as determined by the entity

14 that conducts the reconsideration).

15 (B) OPPORTUNITY TO SUBMIT EVI16 DENCE.—A group health plan and a health in17 surance issuer shall provide the parties to the

18 reconsideration with a reasonable opportunity

19 to present evidence and allegations of fact or

20 law, related to the issue in dispute, in person as

21 well as in writing. The plan or issuer shall in22 form the parties of the conditions for submit23 ting the evidence, especially any time limita24 tions.
27

•S 374 IS

1 (5) EFFECT OF RECONSIDERATION.—A decision

2 of a plan or issuer after reconsideration is binding

3 on all parties unless it is reviewed pursuant to sec4 tion 106.

5 (6) LIMITATION ON CONDUCTING RECONSIDER6 ATION.—In conducting the reconsideration under

7 this subsection, the following rules shall apply:

8 (A) The person or persons conducting the

9 reconsideration shall not have been involved in

10 making the underlying coverage determination

11 that is the basis for such reconsideration.

12 (B) If the issuer involved in the reconsider13 ation is the plan’s or issuer’s denial of coverage

14 based on a lack of medical necessity, a clinical

15 peer (as defined in section 2(c)(2)) shall make

16 the reconsidered determination.

17 (7) RECONSIDERATION DEFINED.—In this sub18 title, the term ‘‘reconsideration’’ means a review

19 under this section of a coverage determination that

20 is adverse to the covered individual involved, or of

21 the imposition of a limitation that is prohibited

22 under section 129, including a review of the evidence

23 and findings upon which it was based and any other

24 evidence the parties submit or the group health plan

25 or health insurance issuer obtains.
28

•S 374 IS

1 (b) DETERMINATION BY DEADLINE.—

2 (1) IN GENERAL.—In the case of a request for

3 a reconsideration, the group health plan or health

4 insurance issuer shall provide notice pursuant to

5 subsection (d) to the person submitting the request

6 of its determination as expeditiously as the health

7 condition of the covered individual involved requires,

8 but in no case later than the deadline established

9 under paragraph (2) or, if a request for expedited

10 treatment of a reconsideration is granted under sub11 section (c), the deadline established under paragraph

12 (3).

13 (2) STANDARD DEADLINE.—

14 (A) IN GENERAL.—The deadline estab15 lished under this paragraph is, subject to sub16 paragraph (B)—

17 (i) in the case of a reconsideration re18 garding a coverage determination described

19 in section 104(b)(2), 30 calendar days

20 after the date the plan or issuer receives

21 the request for the reconsideration, or

22 (ii) in other cases, 60 days after such

23 date.
29

•S 374 IS

1 (B) EXTENSION.—The plan or issuer may

2 extend the deadline under subparagraph (A) by

3 up to 14 calendar days if—

4 (i) the covered individual (or an au5 thorized representative of the individual)

6 requests the extension; or

7 (ii) the plan or issuer justifies to the

8 applicable authority a need for additional

9 information to make the reconsideration

10 and how the delay is in the interest of the

11 covered individual.

12 (3) EXPEDITED TREATMENT DEADLINE.—

13 (A) IN GENERAL.—The deadline estab14 lished under this paragraph is, subject to sub15 paragraphs (B) and (C), 72 hours after the

16 date the plan or issuer receives the request for

17 the expedited treatment under subsection (d).

18 (B) EXTENSION.—The plan or issuer may

19 extend the deadline under subparagraph (A) by

20 up to 5 calendar days if—

21 (i) the covered individual (or an au22 thorized representative of the individual)

23 requests the extension; or

24 (ii) the plan or issuer justifies to the

25 applicable authority a need for additional
30

•S 374 IS

1 information to make the reconsideration

2 and how the delay is in the interest of the

3 covered individual.

4 (C) HOW INFORMATION FROM NON5 PARTICIPATING PROVIDERS AFFECTS DEAD6 LINES FOR EXPEDITED RECONSIDERATIONS.—

7 In the case of a group health plan or health in8 surance issuer that requires medical informa9 tion from nonparticipating providers in order to

10 make a reconsideration, the deadline specified

11 under subparagraph (A) shall begin when the

12 plan or issuer receives such information. Non13 participating providers shall make reasonable

14 and diligent efforts to expeditiously gather and

15 forward all necessary information to the plan or

16 issuer in order to receive timely payment.

17 (c) EXPEDITED TREATMENT.—

18 (1) REQUEST FOR EXPEDITED TREATMENT.—A

19 covered individual (or an authorized representative

20 of the individual) may request that the plan or

21 issuer expedite a reconsideration involving the issues

22 described in section 101(a)(2).

23 (2) WHO MAY REQUEST.—To request expedited

24 treatment of a reconsideration, a covered individual

25 (or an authorized representative of the individual)
31

•S 374 IS

1 shall submit an oral or written request directly to

2 the plan or issuer (or, if applicable, to the entity

3 that the plan or issuer has designated as responsible

4 for making the decision relating to the reconsider5 ation).

6 (3) PROVIDER SUPPORT.—

7 (A) IN GENERAL.—A physician or other

8 health care provider may provide oral or written

9 support for a request for expedited treatment

10 under this subsection.

11 (B) PROHIBITION OF PUNITIVE ACTION.—

12 A group health plan and a health insurance

13 issuer in connection with the provision of health

14 insurance coverage shall not take or threaten to

15 take any punitive action against a physician or

16 other health care provider acting on behalf or

17 in support of a covered individual seeking expe18 dited treatment under this subsection.

19 (4) PROCESSING OF REQUESTS.—A group

20 health plan and a health insurance issuer in connec21 tion with the provision of health insurance coverage

22 shall establish and maintain the following procedures

23 for processing requests for expedited treatment of

24 reconsiderations:
32

•S 374 IS

1 (A) An efficient and convenient means for

2 the submission of oral and written requests for

3 expedited treatment. The plan or issuer shall

4 document all oral requests in writing and main5 tain the documentation in the case file of the

6 covered individual involved.

7 (B) A means for deciding promptly wheth8 er to expedite a reconsideration, based on the

9 following requirements:

10 (i) For a request made or supported

11 by a physician, the plan or issuer shall ex12 pedite the reconsideration if the physician

13 indicates that applying the standard dead14 line under subsection (b)(2) for making the

15 reconsideration determination could seri16 ously jeopardize the covered individual’s

17 life, health, or ability to regain or maintain

18 maximum function or (in the case of a

19 child under the age of 6) development.

20 (ii) For another request, the plan or

21 issuer shall expedite the reconsideration if

22 the plan or issuer determines that applying

23 such standard deadline for making the re24 consideration determination could seriously

25 jeopardize the covered individual’s life,
33

•S 374 IS

1 health, or ability to regain or maintain

2 maximum function or (in the case of a

3 child under the age of 6) development.

4 (5) ACTIONS FOLLOWING DENIAL OF REQUEST

5 FOR EXPEDITED TREATMENT.—If a group health

6 plan or a health insurance issuer in connection with

7 the provision of health insurance coverage denies a

8 request for expedited treatment of a reconsideration

9 under this subsection, the plan or issuer shall—

10 (A) make the reconsideration determina11 tion within the standard deadline otherwise ap12 plicable; and

13 (B) provide the individual submitting the

14 request with—

15 (i) prompt oral notice of the denial of

16 the request, and

17 (ii) within 2 business days a written

18 notice that—

19 (I) explains that the plan or

20 issuer will process the reconsideration

21 request within the standard deadlines;

22 (II) informs the requester of the

23 right to file a grievance if the re24 quester disagrees with the plan’s or
34

•S 374 IS

1 issuer’s decision not to expedite the

2 reconsideration; and

3 (III) provides instructions about

4 the grievance process and its time5 frames.

6 (6) ACTION ON ACCEPTED REQUEST FOR EXPE7 DITED TREATMENT.—If a group health plan or

8 health insurance issuer grants a request for expe9 dited treatment of a reconsideration, the plan or

10 issuer shall make the reconsideration determination

11 and provide the notice under subsection (d) within

12 the deadlines specified under subsection (b)(3).

13 (d) NOTICE OF DECISION IN RECONSIDERATIONS.—

14 (1) REQUIREMENT.—

15 (A) IN GENERAL.—A group health plan or

16 health insurance issuer that makes a decision in

17 the reconsideration that—

18 (i) is completely favorable to the cov19 ered individual shall provide the party sub20 mitting the request for the reconsideration

21 with notice of such decision; or

22 (ii) is adverse, in whole or in part, to

23 the covered individual shall—

24 (I) provide such party with writ25 ten notice of the decision, including
35

•S 374 IS

1 the information described in subpara2 graph (B), and

3 (II) prepare the case file (includ4 ing such notice) for the covered indi5 vidual involved, to be available for

6 submission (if requested) under sec7 tion 106(a).

8 (B) CONTENT OF WRITTEN NOTICE.—The

9 written notice under subparagraph (A)(ii)(I)

10 shall—

11 (i) provide the specific reasons for the

12 decision in the reconsideration (including,

13 in the case of a decision relating to utiliza14 tion review, the clinical rationale for the

15 decision) in clear and understandable lan16 guage;

17 (ii) include notice of the availability of

18 the clinical review criteria relied upon in

19 making the decision;

20 (iii) describe the review processes es21 tablished to carry out sections 106, includ22 ing the right to, and conditions for, obtain23 ing expedited consideration of requests for

24 review under such section; and
36

•S 374 IS

1 (iv) comply with any other require2 ments specified by the appropriate Sec3 retary.

4 (2) FAILURE TO PROVIDE TIMELY NOTICE.—

5 Any failure of a group health plan or health insur6 ance issuer to provide a covered individual with

7 timely notice of a decision in a reconsideration as

8 specified in this section shall constitute an affirma9 tion of the adverse coverage determination and the

10 plan or issuer shall submit the case file to the quali11 fied external appeal entity under section 106 within

12 24 hours of expiration of the deadline otherwise ap13 plicable.

14 (3) PROVISION OF ORAL NOTICE WITH WRIT15 TEN CONFIRMATION IN CASE OF EXPEDITED TREAT16 MENT.—If a group health plan or health insurance

17 issuer grants a request for expedited treatment

18 under subsection (c), the plan or issuer may first

19 provide notice of the decision in the reconsideration

20 orally within the deadlines established under sub21 section (b)(3) and then shall mail written confirma22 tion of the decision within 2 business days of the

23 date of oral notification.

24 (4) AFFIRMATION OF AN ADVERSE COVERAGE

25 DETERMINATION UNDER EXPEDITED TREATMENT.—
37

•S 374 IS

1 If, as a result of its reconsideration, the plan or

2 issuer affirms, in whole or in part, a coverage deter3 mination that is adverse to the covered individual

4 and the reconsideration received expedited treatment

5 under subsection (c), the plan or issuer shall submit

6 the case file (including the written notice of the deci7 sion in the reconsideration) to the qualified external

8 appeal entity as expeditiously as the covered individ9 ual’s health condition requires, but in no case later

10 than within 24 hours of its affirmation. The plan or

11 issuer shall make reasonable and diligent efforts to

12 assist in gathering and forwarding information to

13 the qualified external appeal entity.

14 (5) NOTIFICATION OF INDIVIDUAL.—If the plan

15 or issuer refers the matter to an qualified external

16 appeal entity under paragraph (2) or (4), it shall

17 concurrently notify the individual (or an authorized

18 representative of the individual) of that action.

19 SEC. 106. EXTERNAL APPEALS (REVIEWS).

20 (a) REVIEW BY QUALIFIED EXTERNAL APPEAL EN21 TITY.—

22 (1) IN GENERAL.—If a qualified external appeal

23 entity obtains a case file under section 105(d) or

24 under paragraph (2) and determines that such ap25 peal is not so supported but—
38

•S 374 IS

1 (A) there is a significant financial amount

2 in controversy (as defined by the Secretary); or

3 (B) the appeal involves services for the di4 agnosis, treatment, or management of an ill5 ness, disability, or condition which the entity

6 finds, in accordance with standards established

7 by the entity and approved by the Secretary,

8 constitutes a condition that could seriously

9 jeopardize the covered individual’s life, health,

10 or ability to regain or maintain maximum func11 tion or (in the case of a child under the age of

12 6) development;

13 the entity shall review and resolve under this section

14 any remaining issues in dispute.

15 (2) REQUEST FOR REVIEW.—

16 (A) IN GENERAL.—A party to a reconsid17 ered determination under section 105 that re18 ceives notice of an unfavorable determination

19 under section 105(d) may request a review of

20 such determination by a qualified external ap21 peal entity under this section.

22 (B) TIME FOR REQUEST.—To request such

23 a review, such party shall submit an oral or

24 written request directly to the plan or issuer

25 (or, if applicable, to the entity that the plan or
39

•S 374 IS

1 issuer has designated as responsible for making

2 the determination).

3 (C) IF REVIEW IS REQUESTED.—If a party

4 provides the plan or issuer (or such an entity)

5 with notice of a request for such review, the

6 plan or issuer (or such entity) shall submit the

7 case file to the qualified external appeal entity

8 as expeditiously as the covered individual’s

9 health condition requires, but in no case later

10 than 2 business days from the date the plan or

11 issuer (or entity) receives such request. The

12 plan or issuer (or entity) shall make reasonable

13 and diligent efforts to assist in gathering and

14 forwarding information to the qualified external

15 appeal entity.

16 (3) NOTICE AND TIMING FOR REVIEW.—The

17 qualified external appeal entity shall establish and

18 apply rules for the timing and content of notices for

19 reviews under this section (including appropriate ex20 pedited treatment of reviews under this section) that

21 are similar to the applicable requirements for timing

22 and content of notices in the case of reconsiderations

23 under subsections (b), (c), and (d) of section 105.

24 (4) PARTIES.—The parties to the review by a

25 qualified external appeal entity under this section
40

•S 374 IS

1 shall be the same parties listed in section 105(a)(4)

2 who qualified during the plan’s or issuer’s reconsid3 eration, with the addition of the plan or issuer.

4 (b) GENERAL ELEMENTS OF EXTERNAL APPEALS.—

5 (1) CONTRACT WITH QUALIFIED EXTERNAL AP6 PEAL ENTITY.—

7 (A) CONTRACT REQUIREMENT.—Subject to

8 subparagraph (B), the external appeal review

9 under this section of a determination of a plan

10 or issuer shall be conducted under a contract

11 between the plan or issuer and 1 or more quali12 fied external appeal entities.

13 (B) ELIGIBILITY FOR DESIGNATION AS EX14 TERNAL REVIEW ENTITY.—Entities eligible to

15 conduct reviews brought under this subsection

16 shall include—

17 (i) any State licensed or credentialed

18 external review entity;

19 (ii) a State agency established for the

20 purpose of conducting independent exter21 nal reviews; and

22 (iii) an independent, external entity

23 that contracts with the appropriate Sec24 retary.

25 (C) LICENSING AND CREDENTIALING.—
41

•S 374 IS

1 (i) IN GENERAL.—In licensing or

2 credentialing entities described in subpara3 graph (B)(i), the State agent shall use li4 censing and certification procedures devel5 oped by the State in consultation with the

6 National Association of Insurance Commis7 sioners.

8 (ii) SPECIAL RULE.—In the case of a

9 State that—

10 (I) has not established such li11 censing or credentialing procedures

12 within 24 months of the date of enact13 ment of this Act, the State shall li14 cense or credential such entities in ac15 cordance with procedures developed by

16 the Secretary; or

17 (II) refuses to designate such en18 tities, the Secretary shall license or

19 credential such entities.

20 (D) QUALIFICATIONS.—An entity (which

21 may be a governmental entity) shall meet the

22 following requirements in order to be a qualified

23 external appeal entity:

24 (i) There is no real or apparent con25 flict of interest that would impede the en-
42

•S 374 IS

1 tity from conducting external appeal activi2 ties independent of the plan or issuer.

3 (ii) The entity conducts external ap4 peal activities through clinical peers (as de5 fined in section 2(c)(2)).

6 (iii) The entity has sufficient medical,

7 legal, and other expertise and sufficient

8 staffing to conduct external appeal activi9 ties for the plan or issuer on a timely basis

10 consistent with subsection (a)(3).

11 (iv) The entity meets such other re12 quirements as the appropriate Secretary

13 may impose.

14 (E) LIMITATION ON PLAN OR ISSUER SE15 LECTION.—If an applicable authority permits

16 more than 1 entity to qualify as a qualified ex17 ternal appeal entity with respect to a group

18 health plan or health insurance issuer and the

19 plan or issuer may select among such qualified

20 entities, the applicable authority—

21 (i) shall assure that the selection proc22 ess will not create any incentives for quali23 fied external appeal entities to make a de24 cision in a biased manner; and
43

•S 374 IS

1 (ii) shall implement procedures for au2 diting a sample of decisions by such enti3 ties to assure that no such decisions are

4 made in a biased manner.

5 (F) OTHER TERMS AND CONDITIONS.—

6 The terms and conditions of a contract under

7 this paragraph shall be consistent with the

8 standards the appropriate Secretary shall estab9 lish to assure that there is no real or apparent

10 conflict of interest in the conduct of external

11 appeal activities. Such contract shall provide

12 that the direct costs of the process (not includ13 ing costs of representation of a covered individ14 ual or other party) shall be paid by the plan or

15 issuer, and not by the covered individual.

16 (2) ELEMENTS OF PROCESS.—An external ap17 peal process under this section shall be conducted

18 consistent with standards established by the appro19 priate Secretary that include at least the following:

20 (A) FAIR PROCESS; DE NOVO DETERMINA21 TION.—The process shall provide for a fair, de

22 novo determination.

23 (B) OPPORTUNITY TO SUBMIT EVIDENCE,

24 HAVE REPRESENTATION, AND MAKE ORAL
44

•S 374 IS

1 PRESENTATION.—Any party to a review under

2 this section—

3 (i) may submit and review evidence

4 related to the issues in dispute,

5 (ii) may use the assistance or rep6 resentation of 1 or more individuals (any

7 of whom may be an attorney), and

8 (iii) may make an oral presentation.

9 (C) PROVISION OF INFORMATION.—The

10 plan or issuer involved shall provide timely ac11 cess to all its records relating to the matter

12 being reviewed under this section and to all pro13 visions of the plan or health insurance coverage

14 (including any coverage manual) relating to the

15 matter.

16 (3) ADMISSIBLE EVIDENCE.—In addition to

17 personal health and medical information supplied

18 with respect to an individual whose claim for bene19 fits has been appealed and the opinion of the indi20 vidual’s treating physician or health care profes21 sional, an external appeals entity shall take into con22 sideration the following evidence:

23 (A) The results of studies that meet pro24 fessionally recognized standards of validity and
45

•S 374 IS

1 replicability or that have been published in

2 peer-reviewed journals.

3 (B) The results of professional consensus

4 conferences conducted or financed in whole or

5 in part by one or more government agencies.

6 (C) Practice and treatment guidelines pre7 pared or financed in whole or in part by govern8 ment agencies.

9 (D) Government-issued coverage and treat10 ment policies.

11 (E) To the extent that the entity deter12 mines it to be free of any conflict of interest—

13 (i) the opinions of individuals who are

14 qualified as experts in one or more fields

15 of health care which are directly related to

16 the matters under appeal, and

17 (ii) the results of peer reviews con18 ducted by the plan or issuer involved.

19 (c) NOTICE OF DETERMINATION BY EXTERNAL AP20 PEAL ENTITY.—

21 (1) RESPONSIBILITY FOR THE NOTICE.—After

22 the qualified external appeal entity has reviewed and

23 resolved the determination that has been appealed,

24 such entity shall mail a notice of its final decision

25 to the parties.
46

•S 374 IS

1 (2) CONTENT OF THE NOTICE.—The notice de2 scribed in paragraph (1) shall—

3 (A) describe the specific reasons for the

4 entity’s decisions; and

5 (B) comply with any other requirements

6 specified by the appropriate Secretary.

7 (d) EFFECT OF DETERMINATION.—A final decision

8 by the qualified external appeal entity after a review of

9 the determination that has been appealed is final and

10 binding on the group health plan or the health insurance

11 issuer.

12 Subtitle B—Consumer Information

13 SEC. 111. HEALTH PLAN INFORMATION.

14 (a) DISCLOSURE REQUIREMENT.—

15 (1) GROUP HEALTH PLANS.—A group health

16 plan shall—

17 (A) provide to participants and bene18 ficiaries at the time of initial coverage under

19 the plan (or the effective date of this section, in

20 the case of individuals who are participants or

21 beneficiaries as of such date), at least annually

22 thereafter, and at the beginning of any open en23 rollment period provided under the plan, the in24 formation described in subsection (b) in printed

25 form;
47

•S 374 IS

1 (B) provide to participants and bene2 ficiaries information in printed form on mate3 rial changes in the information described in

4 paragraphs (1), (2)(A), (2)(B), (3)(A), (6), and

5 (7) of subsection (b), or a change in the health

6 insurance issuer through which coverage is pro7 vided, within a reasonable period of (as speci8 fied by the Secretary, but not later than 30

9 days after) the effective date of the changes;

10 and

11 (C) upon request, make available to par12 ticipants and beneficiaries, the applicable au13 thority, and prospective participants and bene14 ficiaries, the information described in sub15 sections (b) and (c) in printed form.

16 (2) HEALTH INSURANCE ISSUERS.—A health

17 insurance issuer in connection with the provision of

18 health insurance coverage shall—

19 (A) provide to individuals enrolled under

20 such coverage at the time of enrollment, and at

21 least annually thereafter, (and to plan adminis22 trators of group health plans in connection with

23 which such coverage is offered) the information

24 described in subsection (b) in printed form;
48

•S 374 IS

1 (B) provide to enrollees and such plan ad2 ministrators information in printed form on

3 material changes in the information described

4 in paragraphs (1), (2)(A), (2)(B), (3)(A), (6),

5 and (7) of subsection (b), or a change in the

6 health insurance issuer through which coverage

7 is provided, within a reasonable period of (as

8 specified by the Secretary, but not later than

9 30 days after) the effective date of the changes;

10 and

11 (C) upon request, make available to the

12 applicable authority, to individuals who are pro13 spective enrollees, to plan administrators of

14 group health plans that may obtain such cov15 erage, and to the public the information de16 scribed in subsections (b) and (c) in printed

17 form.

18 (3) EXEMPTION AUTHORITY.—Upon application

19 of one or more group health plans or health insur20 ance issuers, the appropriate Secretary, under proce21 dures established by such Secretary, may grant an

22 exemption to one or more plans or issuers from com23 pliance with one or more of the requirements of

24 paragraph (1) or (2). Such an exemption may be

25 granted for plans and issuers as a class with similar
49

•S 374 IS

1 characteristics, such as private fee-for-service plans

2 described in section 1859(b)(2) of the Social Secu3 rity Act.

4 (4) ESTABLISHMENT OF INTERNET SITE.—The

5 appropriate Secretaries shall provide for the estab6 lishment of 1 or more sites on the Internet to pro7 vide technical support and information concerning

8 the rights of participants, beneficiaries, and enrollees

9 under this title.

10 (b) INFORMATION PROVIDED.—The information de11 scribed in this subsection with respect to a group health

12 plan or health insurance coverage offered by a health in13 surance issuer includes the following:

14 (1) SERVICE AREA.—The service area of the

15 plan or issuer.

16 (2) BENEFITS.—Benefits offered under the

17 plan or coverage, including—

18 (A) covered benefits, including benefits for

19 preventive services, benefit limits, and coverage

20 exclusions, any optional supplemental benefits

21 under the plan or coverage and the terms and

22 conditions (including premiums or cost-sharing)

23 for such supplemental benefits, and any out-of24 area coverage;
50

•S 374 IS

1 (B) cost sharing, such as premiums,

2 deductibles, coinsurance, and copayment

3 amounts, including any liability for balance bill4 ing, any maximum limitations on out of pocket

5 expenses, and the maximum out of pocket costs

6 for services that are provided by nonparticipat7 ing providers or that are furnished without

8 meeting the applicable utilization review re9 quirements;

10 (C) the extent to which benefits may be ob11 tained from nonparticipating providers, and any

12 supplemental premium or cost-sharing in so ob13 taining such benefits;

14 (D) the extent to which a participant, ben15 eficiary, or enrollee may select from among par16 ticipating providers and the types of providers

17 participating in the plan or issuer network;

18 (E) process for determining experimental

19 coverage or coverage in cases of investigational

20 treatments and clinical trials; and

21 (F) use of a prescription drug formulary.

22 (3) ACCESS.—A description of the following:

23 (A) The number, mix, and distribution of

24 health care providers under the plan or cov25 erage.
51

•S 374 IS

1 (B) The procedures for participants, bene2 ficiaries, and enrollees to select, access, and

3 change participating primary and specialty pro4 viders.

5 (C) The rights and procedures for obtain6 ing referrals (including standing referrals) to

7 participating and nonparticipating providers.

8 (D) Any limitations imposed on the selec9 tion of qualifying participating health care pro10 viders, including any limitations imposed under

11 section 122(a)(2)(B).

12 (E) How the plan or issuer addresses the

13 needs of participants, beneficiaries, and enroll14 ees and others who do not speak English or

15 who have other special communications needs in

16 accessing providers under the plan or coverage,

17 including the provision of information described

18 in this subsection and subsection (c) to such in19 dividuals, including the provision of information

20 in a language other than English if 5 percent

21 of the number of participants, beneficiaries, and

22 enrollees communicate in that language instead

23 of English, and including the availability of in24 terpreters, audio tapes, and information in
52

•S 374 IS

1 braille to meet the needs of people with special

2 communications needs.

3 (4) OUT-OF-AREA COVERAGE.—Out-of-area cov4 erage provided by the plan or issuer.

5 (5) EMERGENCY COVERAGE.—Coverage of

6 emergency services, including—

7 (A) the appropriate use of emergency serv8 ices, including use of the 911 telephone system

9 or its local equivalent in emergency situations

10 and an explanation of what constitutes an

11 emergency situation;

12 (B) the process and procedures of the plan

13 or issuer for obtaining emergency services; and

14 (C) the locations of (i) emergency depart15 ments, and (ii) other settings, in which plan

16 physicians and hospitals provide emergency

17 services and post-stabilization care.

18 (6) PRIOR AUTHORIZATION RULES.—Rules re19 garding prior authorization or other review require20 ments that could result in noncoverage or non21 payment.

22 (7) GRIEVANCE AND APPEALS PROCEDURES.—

23 All appeal or grievance rights and procedures under

24 the plan or coverage, including the method for filing

25 grievances and the time frames and circumstances
53

•S 374 IS

1 for acting on grievances and appeals, the name, ad2 dress, and telephone number of the applicable au3 thority with respect to the plan or issuer, and the

4 availability of assistance through an ombudsman to

5 individuals in relation to group health plans and

6 health insurance coverage.

7 (8) QUALITY ASSURANCE.—A summary descrip8 tion of the data on quality indicators and measures

9 submitted under section 112(a) for the plan or

10 issuer, including a summary description of the data

11 on process and outcome satisfaction of participants,

12 beneficiaries, and enrollees (including data on indi13 vidual voluntary disenrollment and grievances and

14 appeals) described in section 112(b)(3)(D), and no15 tice that information comparing such indicators and

16 measures for different plans and issuers is available

17 through the Agency for Health Care Policy and Re18 search.

19 (9) SUMMARY OF PROVIDER FINANCIAL INCEN20 TIVES.—A summary description of the information

21 on the types of financial payment incentives (de22 scribed in section 1852(j)(4) of the Social Security

23 Act) provided by the plan or issuer under the cov24 erage.
54

•S 374 IS

1 (10) INFORMATION ON ISSUER.—Notice of ap2 propriate mailing addresses and telephone numbers

3 to be used by participants, beneficiaries, and enroll4 ees in seeking information or authorization for treat5 ment.

6 (11) INFORMATION ON LICENSURE.—Informa7 tion on the licensure, certification, or accreditation

8 status of the plan or issuer.

9 (12) AVAILABILITY OF TECHNICAL SUPPORT

10 AND INFORMATION.—Notice that technical support

11 and information concerning the rights of partici12 pants, beneficiaries, and enrollees under this title are

13 available from the Secretary of Labor (in the case

14 of group health plans) or the Secretary of Health

15 and Human Services (in the case of health insurance

16 issuers), including the telephone numbers and mail17 ing address of the regional offices of the appropriate

18 Secretary and the Internet address to obtain such

19 information and support.

20 (13) ADVANCE DIRECTIVES AND ORGAN DONA21 TION DECISIONS.—Information regarding the use of

22 advance directives and organ donation decisions

23 under the plan or coverage.

24 (14) PARTICIPATING PROVIDER LIST.—A list of

25 current participating health care providers for the
55

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1 relevant geographic area, including the name, ad2 dress and telephone number of each provider.

3 (15) AVAILABILITY OF INFORMATION ON RE4 QUEST.—Notice that the information described in

5 subsection (c) is available upon request and how and

6 where (such as the telephone number and Internet

7 website) such information may be obtained.

8 (c) INFORMATION MADE AVAILABLE UPON RE9 QUEST.—The information described in this subsection is

10 the following:

11 (1) UTILIZATION REVIEW ACTIVITIES.—A de12 scription of procedures used and requirements (in13 cluding circumstances, time frames, and appeal

14 rights) under any utilization review program under

15 section 102(a), including under any drug formulary

16 program under section 123(b).

17 (2) GRIEVANCE AND APPEALS INFORMATION.—

18 Information on the number of grievances and inter19 nal and external appeals and on the disposition in

20 the aggregate of such matters, including information

21 on the reasons for the disposition of external appeal

22 cases.

23 (3) METHOD OF COMPENSATION.—A summary

24 description as to the method of compensation of par25 ticipating health care professionals and health care
56

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1 facilities, including information on the types of fi2 nancial payment incentives (described in section

3 1852(j)(4) of the Social Security Act) provided by

4 the plan or issuer under the coverage and on the

5 proportion of participating health care professionals

6 who are compensated under each type of incentive

7 under the plan or coverage.

8 (4) CONFIDENTIALITY POLICIES AND PROCE9 DURES.—A description of the policies and proce10 dures established to carry out section 112.

11 (5) FORMULARY RESTRICTIONS.—A description

12 of the nature of any drug formula restrictions, in13 cluding the specific prescription medications in14 cluded in any formulary and any provisions for ob15 taining off-formulary medications.

16 (6) ADDITIONAL INFORMATION ON PARTICIPAT17 ING PROVIDERS.—For each current participating

18 health care provider described in subsection

19 (b)(14)—

20 (A) the licensure or accreditation status of

21 the provider;

22 (B) to the extent possible, an indication of

23 whether the provider is available to accept new

24 patients;
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1 (C) in the case of medical personnel, the

2 education, training, speciality qualifications or

3 certification, speciality focus, affiliation ar4 rangements, and specialty board certification (if

5 any) of the provider; and

6 (D) any measures of consumer satisfaction

7 and quality indicators for the provider.

8 (7) PERCENTAGE OF PREMIUMS USED FOR

9 BENEFITS (LOSS-RATIOS).—In the case of health in10 surance coverage only (and not with respect to group

11 health plans that do not provide coverage through

12 health insurance coverage), a description of the over13 all loss-ratio for the coverage (as defined in accord14 ance with rules established or recognized by the Sec15 retary of Health and Human Services).

16 (8) QUALITY INFORMATION DEVELOPED.—

17 Quality information on processes and outcomes de18 veloped as part of an accreditation or licensure proc19 ess for the plan or issuer to the extent the informa20 tion is publicly available.

21 (d) FORM OF DISCLOSURE.—

22 (1) UNIFORMITY.—Information required to be

23 disclosed under this section shall be provided in ac24 cordance with uniform, national reporting standards

25 specified by the Secretary, after consultation with
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•S 374 IS

1 applicable State authorities, so that prospective en2 rollees may compare the attributes of different

3 issuers and coverage offered within an area within a

4 type of coverage. Such information shall be provided

5 in an accessible format that is understandable to the

6 average participant, beneficiary, or enrollee involved.

7 (2) INFORMATION INTO HANDBOOK.—Nothing

8 in this section shall be construed as preventing a

9 group health plan or health insurance issuer from

10 making the information under subsections (b) and

11 (c) available to participants, beneficiaries, and en12 rollees through an enrollee handbook or similar pub13 lication.

14 (3) UPDATING PARTICIPATING PROVIDER IN15 FORMATION.—The information on participating

16 health care providers described in subsections

17 (b)(14) and (c)(6) shall be updated within such rea18 sonable period as determined appropriate by the

19 Secretary. A group health plan or health insurance

20 issuer shall be considered to have complied with the

21 provisions of such subsection if the plan or issuer

22 provides the directory or listing of participating pro23 viders to participants and beneficiaries or enrollees

24 once a year and such directory or listing is updated

25 within such a reasonable period to reflect any mate-
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1 rial changes in participating providers. Nothing in

2 this section shall prevent a plan or issuer from

3 changing or updating other information made avail4 able under this section.

5 (4) RULE OF MAILING TO LAST ADDRESS.—For

6 purposes of this section, a plan or issuer, in reliance

7 on records maintained by the plan or issuer, shall be

8 deemed to have met the requirements of this section

9 with respect to the disclosure of information to a

10 participant, beneficiary, or enrollee if the plan or

11 issuer transmits the information requested to the

12 participant, beneficiary, or enrollee at the address

13 contained in such records with respect to such par14 ticipant, beneficiary, or enrollee.

15 (e) ENROLLEE ASSISTANCE.—

16 (1) IN GENERAL.—Each State that obtains a

17 grant under paragraph (3) shall provide for creation

18 and operation of a Health Insurance Ombudsman

19 through a contract with a not-for-profit organization

20 that operates independent of group health plans and

21 health insurance issuers. Such Ombudsman shall be

22 responsible for at least the following:

23 (A) To provide consumers in the State

24 with information about health insurance cov-
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1 erage options or coverage options offered within

2 group health plan.

3 (B) To provide counseling and assistance

4 to enrollees dissatisfied with their treatment by

5 health insurance issuers and group health plans

6 in regard to such coverage or plans and with re7 spect to grievances and appeals regarding deter8 minations under such coverage or plans.

9 (2) FEDERAL ROLE.—In the case of any State

10 that does not provide for such an Ombudsman under

11 paragraph (1), the Secretary may provide for the

12 creation and operation of a Health Insurance Om13 budsman through a contract with a not-for-profit or14 ganization that operates independent of group health

15 plans and health insurance issuers and that is to

16 provide consumers in the State with information

17 about health insurance coverage options or coverage

18 options offered within group health plans.

19 (3) ELIGIBILITY.—To be eligible to serve as a

20 Health Insurance Ombudsman under this section, a

21 not-for-profit organization shall provide assurances

22 that—

23 (A) the organization has no real or per24 ceived conflict of interest in providing advice
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1 and assistance to consumers regarding health

2 insurance coverage, and

3 (B) the organization is independent of

4 health insurance issuers, health care providers,

5 health care payors, and regulators of health

6 care or health insurance.

7 (4) AUTHORIZATION OF APPROPRIATIONS.—

8 There are authorized to be appropriated to the Sec9 retary of Health and Human Services such amounts

10 as may be necessary to provide for grants to States

11 for contracts for Health Insurance Ombudsmen

12 under paragraph (1) or contracts for such Ombuds13 men under paragraph (2).

14 (5) CONSTRUCTION.—Nothing in this section

15 shall be construed to prevent the use of other forms

16 of enrollee assistance.

17 (f) CONSTRUCTION.—Nothing in this section shall be

18 construed as requiring public disclosure of individual con19 tracts or financial arrangements between a group health

20 plan or health insurance issuer and any provider.

21 SEC. 112. HEALTH CARE QUALITY INFORMATION.

22 (a) COLLECTION AND SUBMISSION OF INFORMATION

23 ON QUALITY INDICATORS AND MEASURES.—

24 (1) IN GENERAL.—A group health plan and a

25 health insurance issuer that offers health insurance
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1 coverage shall collect and submit to the Director for

2 the Agency for Health Care Policy and Research (in

3 this section referred to as the ‘‘Director’’) aggregate

4 data on quality indicators and measures (as defined

5 in subsection (g)) that includes the minimum uni6 form data set specified under subsection (b). Such

7 data shall not include patient identifiers.

8 (2) DATA SAMPLING METHODS.—The Director

9 shall develop data sampling methods for the collec10 tion of data under this subsection.

11 (3) EXEMPTION AUTHORITY.—The provisions

12 of section 111(a)(3) shall apply to the requirements

13 of paragraph (1) in the same manner as they apply

14 to the requirements referred to in such section.

15 (b) MINIMUM UNIFORM DATA SET.—

16 (1) IN GENERAL.—The Secretary shall specify

17 (and may from time to time update) by rule the data

18 required to be included in the minimum uniform

19 data set under subsection (a) and the standard for20 mat for such data.

21 (2) DESIGN.—Such specification shall—

22 (A) take into consideration the different

23 populations served (such as children and indi24 viduals with disabilities);
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•S 374 IS

1 (B) be consistent where appropriate with

2 requirements applicable to Medicare+Choice

3 health plans under 1851(d)(4)(D) of the Social

4 Security Act;

5 (C) take into consideration such dif6 ferences in the delivery system among group

7 health plans and health insurance issuers as the

8 Secretary deems appropriate;

9 (D) be consistent with standards adopted

10 to carry out part C of title XI of the Social Se11 curity Act; and

12 (E) be consistent where feasible with exist13 ing health plan quality indicators and measures

14 used by employers and purchasers.

15 (3) MINIMUM DATA.—The data in such set

16 shall include, to the extent determined feasible by

17 the appropriate Secretary, at least—

18 (A) data on process measures of clinical

19 performance for health care services provided

20 by health care professionals and facilities;

21 (B) data on outcomes measures of morbid22 ity and mortality including to the extent fea23 sible and appropriate data for pediatric and

24 gender-specific measures; and
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•S 374 IS

1 (C) data on data on satisfaction of such in2 dividuals, including data on voluntary

3 disenrollment and grievances.

4 The minimum data set under this paragraph shall

5 be established by the appropriate Secretaries using

6 a negotiated rulemaking process under subchapter

7 III of chapter 5 of title 5, United States Code.

8 (c) DISSEMINATION OF INFORMATION.—

9 (1) IN GENERAL.—The Director shall publicly

10 disseminate (through printed media and the Inter11 net) information on the aggregate data submitted

12 under this section.

13 (2) FORMATS.—The information shall be dis14 seminated in a manner that provides for a compari15 son of health care quality among different group

16 health plans and health insurance issuers, with ap17 propriate differentiation by delivery system. In dis18 seminating the information, the Director may ref19 erence an appropriate benchmark (or benchmarks)

20 for performance with respect to specific quality indi21 cators and measures (or groups of such measures).

22 (d) HEALTH CARE QUALITY RESEARCH AND INFOR23 MATION.—The Secretary of Health and Human Services,

24 acting through the Director, shall conduct and support re25 search demonstration projects, evaluations, and the dis-
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•S 374 IS

1 semination of information with respect to measurement,

2 status, improvement, and presentation of quality indica3 tors and measures and other health care quality informa4 tion.

5 (e) NATIONAL REPORTS ON HEALTH CARE QUAL6 ITY.—

7 (1) REPORT ON NATIONAL GOALS.—Not later

8 than 18 months after the date of enactment of this

9 Act, and every 2 years thereafter, the Secretary of

10 Health and Human Services shall prepare and sub11 mit to the appropriate committees of Congress and

12 the President a report that—

13 (A) establishes national goals for the im14 provement of the quality of health care; and

15 (B) contains recommendations for achiev16 ing the national goals established under para17 graph (1).

18 (2) REPORT ON HEALTH RELATED TOPICS.—

19 Not later than 30 months after the date of enact20 ment of this Act and every 2 years thereafter, such

21 Secretary shall prepare and submit to Congress and

22 the President a report that addresses at least 1 of

23 the following (or a related matter):
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1 (A) The availability, applicability, and ap2 propriateness of information to consumers re3 garding the quality of their health care.

4 (B) The state of information systems and

5 data collecting capabilities for measuring and

6 reporting on quality indicators.

7 (C) The impact of quality measurement on

8 access to and the cost of medical care.

9 (D) Barriers to continuous quality im10 provement in medical care.

11 (E) The state of health care quality meas12 urement research and development.

13 (f) AUTHORIZATION OF APPROPRIATIONS.—There

14 are authorized to be appropriated $25,000,000 for each

15 fiscal year (beginning with fiscal year 2000) to carry out

16 this section. Any such amounts appropriated for a fiscal

17 year shall remain available, without fiscal year limitation,

18 until expended.

19 (g) QUALITY INDICATORS AND MEASURES DE20 FINED.—For purposes of this section, the term ‘‘quality

21 indicators and measures’’ means structural characteris22 tics, patient-encounter data, and the subsequent health

23 status change of a patient as a result of health care serv24 ices provided by health care professionals and facilities.
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1 SEC. 113. CONFIDENTIALITY AND ACCURACY OF ENROLLEE

2 RECORDS.

3 A group health plan or a health insurance issuer shall

4 establish procedures with respect to medical records or

5 other health information maintained regarding partici6 pants, beneficiaries, and enrollees to safeguard the privacy

7 of any individually identifiable information about them.

8 SEC. 114. QUALITY ASSURANCE.

9 (a) REQUIREMENT.—A group health plan, and a

10 health insurance issuer that offers health insurance cov11 erage, shall establish and maintain an ongoing, internal

12 quality assurance and continuous quality improvement

13 program that meets the requirements of subsection (b).

14 (b) PROGRAM REQUIREMENTS.—The requirements of

15 this subsection for a quality improvement program of a

16 plan or issuer are as follows:

17 (1) ADMINISTRATION.—The plan or issuer has

18 an identifiable unit with responsibility for adminis19 tration of the program.

20 (2) WRITTEN PLAN.—The plan or issuer has a

21 written plan for the program that is updated annu22 ally and that specifies at least the following:

23 (A) The activities to be conducted.

24 (B) The organizational structure.

25 (C) The duties of the medical director.
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1 (D) Criteria and procedures for the assess2 ment of quality.

3 (3) SYSTEMATIC REVIEW.—The program pro4 vides for systematic review of the type of health

5 services provided, consistency of services provided

6 with good medical practice, and patient outcomes.

7 (4) QUALITY CRITERIA.—The program—

8 (A) uses criteria that are based on per9 formance and patient outcomes where feasible

10 and appropriate;

11 (B) includes criteria that are directed spe12 cifically at meeting the needs of at-risk popu13 lations and covered individuals with chronic

14 conditions or severe illnesses, including gender15 specific criteria and pediatric-specific criteria

16 where available and appropriate;

17 (C) includes methods for informing covered

18 individuals of the benefit of preventive care and

19 what specific benefits with respect to preventive

20 care are covered under the plan or coverage;

21 and

22 (D) makes available to the public a de23 scription of the criteria used under subpara24 graph (A).
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1 (5) SYSTEM FOR IDENTIFYING.—The program

2 has procedures for identifying possible quality con3 cerns by providers and enrollees and for remedial ac4 tions to correct quality problems, including written

5 procedures for responding to concerns and taking

6 appropriate corrective action.

7 (6) DATA ANALYSIS.—The program provides,

8 using data that include the data collected under sec9 tion 112, for an analysis of the plan’s or issuer’s

10 performance on quality measures.

11 (7) DRUG UTILIZATION REVIEW.—The program

12 provides for a drug utilization review program

13 which—

14 (A) encourages appropriate use of prescrip15 tion drugs by participants, beneficiaries, and

16 enrollees and providers, and

17 (B) takes appropriate action to reduce the

18 incidence of improper drug use and adverse

19 drug reactions and interactions.

20 (c) DEEMING.—For purposes of subsection (a), the

21 requirements of—

22 (1) subsection (b) (other than paragraph (5))

23 are deemed to be met with respect to a health insur24 ance issuer that is a qualified health maintenance
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1 organization (as defined in section 1310(c) of the

2 Public Health Service Act); or

3 (2) subsection (b) are deemed to be met with

4 respect to a health insurance issuer that is accred5 ited by a national accreditation organization that the

6 Secretary certifies as applying, as a condition of cer7 tification, standards at least a stringent as those re8 quired for a quality improvement program under

9 subsection (b).

10 (d) VARIATION PERMITTED.—The Secretary may

11 provide for variations in the application of the require12 ments of this section to group health plans and health in13 surance issuers based upon differences in the delivery sys14 tem among such plans and issuers as the Secretary deems

15 appropriate.

16 (e) CONSULTATION IN MEDICAL POLICIES.—A group

17 health plan, and health insurance issuer that offers health

18 insurance coverage, shall consult with participating physi19 cians (if any) regarding the plan’s or issuer’s medical pol20 icy, quality, and medical management procedures.

21 Subtitle C—Patient Protection

22 Standards

23 SEC. 121. EMERGENCY SERVICES.

24 (a) COVERAGE OF EMERGENCY SERVICES.—
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1 (1) IN GENERAL.—If a group health plan, or

2 health insurance coverage offered by a health insur3 ance issuer, provides any benefits with respect to

4 emergency services (as defined in paragraph (2)(B)),

5 the plan or issuer shall cover emergency services fur6 nished under the plan or coverage—

7 (A) without the need for any prior author8 ization determination;

9 (B) whether or not the health care pro10 vider furnishing such services is a participating

11 provider with respect to such services;

12 (C) in a manner so that, if such services

13 are provided to a participant, beneficiary, or en14 rollee by a nonparticipating health care provider

15 the participant, beneficiary, or enrollee is not

16 liable for amounts that exceed the amounts of

17 liability that would be incurred if the services

18 were provided by a participating health care

19 provider; and

20 (D) without regard to any other term or

21 condition of such plan or coverage (other than

22 exclusion or coordination of benefits, or an af23 filiation or waiting period, permitted under sec24 tion 2701 of the Public Health Service Act, sec25 tion 701 of the Employee Retirement Income
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•S 374 IS

1 Security Act of 1974, or section 9801 of the

2 Internal Revenue Code of 1986, and other than

3 applicable cost-sharing).

4 (2) DEFINITIONS.—In this section:

5 (A) EMERGENCY MEDICAL CONDITION

6 BASED ON PRUDENT LAYPERSON STANDARD.—

7 The term ‘‘emergency medical condition’’ means

8 a medical condition manifesting itself by acute

9 symptoms of sufficient severity (including se10 vere pain) such that a prudent layperson, who

11 possesses an average knowledge of health and

12 medicine, could reasonably expect the absence

13 of immediate medical attention to result in a

14 condition described in clause (i), (ii), or (iii) of

15 section 1867(e)(1)(A) of the Social Security

16 Act.

17 (B) EMERGENCY SERVICES.—The term

18 ‘‘emergency services’’ means—

19 (i) a medical screening examination

20 (as required under section 1867 of the So21 cial Security Act) that is within the capa22 bility of the emergency department of a

23 hospital, including ancillary services rou24 tinely available to the emergency depart25 ment to evaluate an emergency medical
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•S 374 IS

1 condition (as defined in subparagraph

2 (A)), and

3 (ii) within the capabilities of the staff

4 and facilities available at the hospital, such

5 further medical examination and treatment

6 as are required under section 1867 of such

7 Act to stabilize the patient.

8 (b) REIMBURSEMENT FOR MAINTENANCE CARE AND

9 POST-STABILIZATION CARE.—In the case of services

10 (other than emergency services) for which benefits are

11 available under a group health plan, or under health insur12 ance coverage offered by a health insurance issuer, the

13 plan or issuer shall provide for reimbursement with re14 spect to such services provided to a participant, bene15 ficiary, or enrollee other than through a participating

16 health care provider in a manner consistent with sub17 section (a)(1)(C) if the services are maintenance care or

18 post-stabilization care covered under the guidelines estab19 lished under section 1852(d)(2) of the Social Security Act

20 (relating to promoting efficient and timely coordination of

21 appropriate maintenance and post-stabilization care of an

22 enrollee after an enrollee has been determined to be sta23 ble), in accordance with regulations established to carry

24 out such section.
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1 SEC. 122. ENROLLEE CHOICE OF HEALTH PROFESSIONALS

2 AND PROVIDERS.

3 (a) CHOICE OF PERSONAL HEALTH PROFES4 SIONAL.—

5 (1) PRIMARY CARE.—A group health plan, and

6 a health insurance issuer that offers health insur7 ance coverage, shall permit each participant, bene8 ficiary, and enrollee—

9 (A) to receive primary care from any par10 ticipating primary care provider who is avail11 able to accept such individual, and

12 (B) in the case of a participant, bene13 ficiary, or enrollee who has a child who is also

14 covered under the plan or coverage, to des15 ignate a participating physician who specializes

16 in pediatrics as the child’s primary care pro17 vider.

18 (2) SPECIALISTS.—

19 (A) IN GENERAL.—Subject to subpara20 graph (B), a group health plan and a health in21 surance issuer that offers health insurance cov22 erage shall permit each participant, beneficiary,

23 or enrollee to receive medically necessary or ap24 propriate specialty care, pursuant to appro25 priate referral procedures, from any qualified
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•S 374 IS

1 participating health care provider who is avail2 able to accept such individual for such care.

3 (B) LIMITATION.—Subparagraph (A) shall

4 not apply to specialty care if the plan or issuer

5 clearly informs participants, beneficiaries, and

6 enrollees of the limitations on choice of partici7 pating providers with respect to such care.

8 (b) SPECIALIZED SERVICES.—

9 (1) OBSTETRICAL AND GYNECOLOGICAL

10 CARE.—

11 (A) IN GENERAL.—If a group health plan,

12 or a health insurance issuer in connection with

13 the provision of health insurance coverage, re14 quires or provides for a participant, beneficiary,

15 or enrollee to designate a participating primary

16 care provider, and an individual who is female

17 has not designated a participating physician

18 specializing in obstetrics and gynecology as a

19 primary care provider, the plan or issuer—

20 (i) may not require authorization or a

21 referral by the individual’s primary care

22 provider or otherwise for coverage of rou23 tine gynecological care (such as preventive

24 women’s health examinations) and preg25 nancy-related services provided by a par-
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•S 374 IS

1 ticipating health care professional who spe2 cializes in obstetrics and gynecology to the

3 extent such care is otherwise covered, and

4 (ii) may treat the ordering of other

5 gynecological care by such a participating

6 physician as the authorization of the pri7 mary care provider with respect to such

8 care under the plan or coverage.

9 (B) CONSTRUCTION.—Nothing in subpara10 graph (A)(ii) shall waive any requirements of

11 coverage relating to medical necessity or appro12 priateness with respect to coverage of gyneco13 logical care so ordered.

14 (2) SPECIALTY CARE.—

15 (A) SPECIALTY CARE FOR COVERED SERV16 ICES.—

17 (i) IN GENERAL.—If—

18 (I) an individual is a participant

19 or beneficiary under a group health

20 plan or an enrollee who is covered

21 under health insurance coverage of22 fered by a health insurance issuer,

23 (II) the individual has a condi24 tion or disease of sufficient serious-
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•S 374 IS

1 ness and complexity to require treat2 ment by a specialist, and

3 (III) benefits for such treatment

4 are provided under the plan or cov5 erage,

6 the plan or issuer shall make or provide for

7 a referral to a specialist who is available

8 and accessible to provide the treatment for

9 such condition or disease.

10 (ii) SPECIALIST DEFINED.—For pur11 poses of this paragraph, the term ‘‘special12 ist’’ means, with respect to a condition, a

13 health care practitioner, facility, or center

14 (such as a center of excellence) that has

15 adequate expertise through appropriate

16 training and experience (including, in the

17 case of a child, appropriate pediatric exper18 tise) to provide high quality care in treat19 ing the condition.

20 (iii) CARE UNDER REFERRAL.—A

21 group health plan or health insurance

22 issuer may require that the care provided

23 to an individual pursuant to such referral

24 under clause (i) be—
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1 (I) pursuant to a treatment plan,

2 only if the treatment plan is developed

3 by the specialist and approved by the

4 plan or issuer, in consultation with

5 the designated primary care provider

6 or specialist and the individual (or the

7 individual’s designee), and

8 (II) in accordance with applicable

9 quality assurance and utilization re10 view standards of the plan or issuer.

11 Nothing in this paragraph shall be con12 strued as preventing such a treatment plan

13 for an individual from requiring a special14 ist to provide the primary care provider

15 with regular updates on the specialty care

16 provided, as well as all necessary medical

17 information.

18 (iv) REFERRALS TO PARTICIPATING

19 PROVIDERS.—A group health plan or

20 health insurance issuer is not required

21 under clause (i) to provide for a referral to

22 a specialist that is not a participating pro23 vider, unless the plan or issuer does not

24 have an appropriate specialist that is avail25 able and accessible to treat the individual’s
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1 condition and that is a participating pro2 vider with respect to such treatment.

3 (v) TREATMENT OF NONPARTICIPAT4 ING PROVIDERS.—If a plan or issuer refers

5 an individual to a nonparticipating special6 ist pursuant to clause (i), services provided

7 pursuant to the approved treatment plan

8 (if any) shall be provided at no additional

9 cost to the individual beyond what the indi10 vidual would otherwise pay for services re11 ceived by such a specialist that is a partici12 pating provider.

13 (B) SPECIALISTS AS PRIMARY CARE PRO14 VIDERS.—

15 (i) IN GENERAL.—A group health

16 plan, or a health insurance issuer, in con17 nection with the provision of health insur18 ance coverage, shall have a procedure by

19 which an individual who is a participant,

20 beneficiary, or enrollee and who has an on21 going special condition (as defined in

22 clause (iii)) may receive a referral to a spe23 cialist for such condition who shall be re24 sponsible for and capable of providing and

25 coordinating the individual’s primary and
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•S 374 IS

1 specialty care. If such an individual’s care

2 would most appropriately be coordinated

3 by such a specialist, such plan or issuer

4 shall refer the individual to such specialist.

5 (ii) TREATMENT AS PRIMARY CARE

6 PROVIDER.—Such specialist shall be per7 mitted to treat the individual without a re8 ferral from the individual’s primary care

9 provider and may authorize such referrals,

10 procedures, tests, and other medical serv11 ices as the individual’s primary care pro12 vider would otherwise be permitted to pro13 vide or authorize, subject to the terms of

14 the treatment plan (referred to in subpara15 graph (A)(iii)(I)).

16 (iii) ONGOING SPECIAL CONDITION

17 DEFINED.—In this subparagraph, the term

18 ‘‘special condition’’ means a condition or

19 disease that—

20 (I) is life-threatening, degenera21 tive, or disabling, and

22 (II) requires specialized medical

23 care over a prolonged period of time.

24 (iv) TERMS OF REFERRAL.—The pro25 visions of clauses (iii) through (v) of sub-
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1 paragraph (A) apply with respect to refer2 rals under clause (i) of this subparagraph

3 in the same manner as they apply to refer4 rals under subparagraph (A)(i).

5 (C) STANDING REFERRALS.—

6 (i) IN GENERAL.—A group health

7 plan, and a health insurance issuer in con8 nection with the provision of health insur9 ance coverage, shall have a procedure by

10 which an individual who is a participant,

11 beneficiary, or enrollee and who has a con12 dition that requires ongoing care from a

13 specialist may receive a standing referral

14 to such specialist for treatment of such

15 condition. If the plan or issuer, or if the

16 primary care provider in consultation with

17 the medical director of the plan or issuer

18 and the specialist (if any), determines that

19 such a standing referral is appropriate, the

20 plan or issuer shall make such a referral to

21 such a specialist.

22 (ii) TERMS OF REFERRAL.—The pro23 visions of clauses (iii) through (v) of sub24 paragraph (A) apply with respect to refer25 rals under clause (i) of this subparagraph
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1 in the same manner as they apply to refer2 rals under subparagraph (A)(i).

3 (c) CONTINUITY OF CARE.—

4 (1) IN GENERAL.—

5 (A) TERMINATION OF PROVIDER.—If a

6 contract between a group health plan, or a

7 health insurance issuer in connection with the

8 provision of health insurance coverage, and a

9 health care provider is terminated (as defined

10 in subparagraph (C)), or benefits or coverage

11 provided by a health care provider are termi12 nated because of a change in the terms of pro13 vider participation in a group health plan, and

14 an individual who is a participant, beneficiary,

15 or enrollee in the plan or coverage is under16 going a course of treatment from the provider

17 at the time of such termination, the plan or

18 issuer shall—

19 (i) notify the individual on a timely

20 basis of such termination, and

21 (ii) subject to paragraph (3), permit

22 the individual to continue or be covered

23 with respect to the course of treatment

24 with the provider during a transitional pe25 riod (provided under paragraph (2)) if the
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1 plan or issuer is notified orally or in writ2 ing of the facts and circumstances concern3 ing the course of treatment.

4 (B) TREATMENT OF TERMINATION OF

5 CONTRACT WITH HEALTH INSURANCE

6 ISSUER.—If a contract for the provision of

7 health insurance coverage between a group

8 health plan and a health insurance issuer is ter9 minated and, as a result of such termination,

10 coverage of services of a health care provider is

11 terminated with respect to an individual, the

12 provisions of subparagraph (A) (and the suc13 ceeding provisions of this section) shall apply

14 under the group health plan in the same man15 ner as if there had been a direct contract be16 tween the group health plan and the provider

17 that had been terminated, but only with respect

18 to benefits that are covered under the group

19 health plan after the contract termination.

20 (C) TERMINATION.—In this section, the

21 term ‘‘terminated’’ includes, with respect to a

22 contract, the expiration or nonrenewal of the

23 contract, but does not include a termination of

24 the contract by the plan or issuer for failure to

25 meet applicable quality standards or for fraud.
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1 (2) TRANSITIONAL PERIOD.—

2 (A) IN GENERAL.—Except as provided in

3 subparagraphs (B) through (D), the transi4 tional period under this subsection shall extend

5 for at least 90 days from the date of the notice

6 described in paragraph (1)(A)(i) of the provid7 er’s termination.

8 (B) INSTITUTIONAL CARE.—The transi9 tional period under this subsection for institu10 tional or inpatient care from a provider shall

11 extend until the discharge or termination of the

12 period of institutionalization and also shall in13 clude institutional care provided within a rea14 sonable time of the date of termination of the

15 provider status.

16 (C) PREGNANCY.—If—

17 (i) a participant, beneficiary, or en18 rollee has entered the second trimester of

19 pregnancy at the time of a provider’s ter20 mination of participation, and

21 (ii) the provider was treating the

22 pregnancy before date of the termination,

23 the transitional period under this subsection

24 with respect to provider’s treatment of the

25 pregnancy shall extend through the provision of
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1 post-partum care directly related to the deliv2 ery.

3 (D) TERMINAL ILLNESS.—If—

4 (i) a participant, beneficiary, or en5 rollee was determined to be terminally ill

6 (as determined under section

7 1861(dd)(3)(A) of the Social Security Act)

8 at the time of a provider’s termination of

9 participation, and

10 (ii) the provider was treating the ter11 minal illness before the date of termi12 nation,

13 the transitional period under this subsection

14 shall extend for the remainder of the individ15 ual’s life for care directly related to the treat16 ment of the terminal illness, but in no case is

17 the transitional period required to extend for

18 longer than 180 days.

19 (3) PERMISSIBLE TERMS AND CONDITIONS.—A

20 group health plan or health insurance issuer may

21 condition coverage of continued treatment by a pro22 vider under paragraph (1)(A)(ii) upon the provider

23 agreeing to the following terms and conditions:

24 (A) The provider agrees to accept reim25 bursement from the plan or issuer and individ-
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1 ual involved (with respect to cost-sharing) at

2 the rates applicable prior to the start of the

3 transitional period as payment in full (or, in the

4 case described in paragraph (1)(B), at the rates

5 applicable under the replacement plan or issuer

6 after the date of the termination of the contract

7 with the health insurance issuer) and not to im8 pose cost-sharing with respect to the individual

9 in an amount that would exceed the cost-shar10 ing that could have been imposed if the contract

11 referred to in paragraph (1)(A) had not been

12 terminated.

13 (B) The provider agrees to adhere to the

14 quality assurance standards of the plan or

15 issuer responsible for payment under subpara16 graph (A) and to provide to such plan or issuer

17 necessary medical information related to the

18 care provided.

19 (C) The provider agrees otherwise to ad20 here to such plan’s or issuer’s policies and pro21 cedures, including procedures regarding utiliza22 tion review and referrals, and obtaining prior

23 authorization and providing services pursuant

24 to a treatment plan (if any) approved by the

25 plan or issuer.
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1 (4) CONSTRUCTION.—Nothing in this sub2 section shall be construed to require the coverage of

3 benefits which would not have been covered if the

4 provider involved remained a participating provider.

5 (d) PROTECTION AGAINST INVOLUNTARY

6 DISENROLLMENT BASED ON CERTAIN CONDITIONS.—

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

8 group health plan and a health insurance issuer in

9 connection with the provision of health insurance

10 coverage may not disenroll an individual under the

11 plan or coverage because the individual’s behavior is

12 considered disruptive, unruly, abusive, or uncoopera13 tive to the extent that the individual’s continued en14 rollment under the coverage seriously impairs the

15 plan’s or issuer’s ability to furnish covered services

16 if the circumstances for the individual’s behavior is

17 directly related to diminished mental capacity, severe

18 and persistent mental illness, or a serious childhood

19 mental and emotional disorder.

20 (2) EXCEPTION.—Paragraph (1) shall not

21 apply if the behavior engaged in directly threatens

22 bodily injury to any person.

23 (e) GENERAL ACCESS.—

24 (1) IN GENERAL.—Each group health plan, and

25 each health insurance issuer offering health insur-
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1 ance coverage, that provides benefits, in whole or in

2 part, through participating health care providers

3 shall have (in relation to the coverage) a sufficient

4 number, distribution, and variety of qualified partici5 pating health care providers to ensure that all cov6 ered health care services, including specialty serv7 ices, will be available and accessible in a timely man8 ner to all participants, beneficiaries, and enrollees

9 under the plan or coverage.

10 (2) TREATMENT OF CERTAIN PROVIDERS.—The

11 qualified health care providers under paragraph (1)

12 may include Federally qualified health centers, rural

13 health clinics, migrant health centers, high-volume,

14 disproportionate share hospitals, and other essential

15 community providers located in the service area of

16 the plan or issuer and shall include such providers

17 if necessary to meet the standards established to

18 carry out such subsection.

19 SEC. 123. ACCESS TO APPROVED SERVICES.

20 (a) COVERAGE FOR INDIVIDUALS PARTICIPATING IN

21 APPROVED CLINICAL TRIALS.—

22 (1) COVERAGE.—

23 (A) IN GENERAL.—If a group health plan,

24 or health insurance issuer that is providing

25 health insurance coverage, provides coverage to
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1 a qualified individual (as defined in paragraph

2 (2)), the plan or issuer—

3 (i) may not deny the individual par4 ticipation in the clinical trial referred to in

5 paragraph (2)(B);

6 (ii) subject to paragraph (3), may not

7 deny (or limit or impose additional condi8 tions on) the coverage of routine patient

9 costs for items and services furnished in

10 connection with participation in the trial;

11 and

12 (iii) may not discriminate against the

13 individual on the basis of the enrollee’s

14 participation in such trial.

15 (B) EXCLUSION OF CERTAIN COSTS.—For

16 purposes of subparagraph (A)(ii), routine pa17 tient costs do not include the cost of the tests

18 or measurements conducted primarily for the

19 purpose of the clinical trial involved.

20 (C) USE OF IN-NETWORK PROVIDERS.—If

21 one or more participating providers is partici22 pating in a clinical trial, nothing in subpara23 graph (A) shall be construed as preventing a

24 plan or issuer from requiring that a qualified

25 individual participate in the trial through such
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1 a participating provider if the provider will ac2 cept the individual as a participant in the trial.

3 (2) QUALIFIED INDIVIDUAL DEFINED.—For

4 purposes of paragraph (1), the term ‘‘qualified indi5 vidual’’ means an individual who is a participant or

6 beneficiary in a group health plan, or who is an en7 rollee under health insurance coverage, and who

8 meets the following conditions:

9 (A)(i) The individual has a life-threatening

10 or serious illness for which no standard treat11 ment is effective.

12 (ii) The individual is eligible to participate

13 in an approved clinical trial according to the

14 trial protocol with respect to treatment of such

15 illness.

16 (iii) The individual’s participation in the

17 trial offers meaningful potential for significant

18 clinical benefit for the individual.

19 (B) Either—

20 (i) the referring physician is a partici21 pating health care professional and has

22 concluded that the individual’s participa23 tion in such trial would be appropriate

24 based upon the individual meeting the con25 ditions described in subparagraph (A); or
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1 (ii) the participant, beneficiary, or en2 rollee provides medical and scientific infor3 mation establishing that the individual’s

4 participation in such trial would be appro5 priate based upon the individual meeting

6 the conditions described in subparagraph

7 (A).

8 (3) PAYMENT.—

9 (A) IN GENERAL.—Under this subsection a

10 group health plan or health insurance issuer

11 shall provide for payment for routine patient

12 costs described in paragraph (1)(A) but is not

13 required to pay for costs of items and services

14 that are reasonably expected (as determined by

15 the Secretary) to be paid for by the sponsors of

16 an approved clinical trial.

17 (B) PAYMENT RATE.—In the case of cov18 ered items and services provided by—

19 (i) a participating provider, the pay20 ment rate shall be at the agreed upon rate,

21 or

22 (ii) a nonparticipating provider, the

23 payment rate shall be at the rate the plan

24 or issuer would normally pay for com25 parable services under clause (i).
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1 (4) APPROVED CLINICAL TRIAL DEFINED.—

2 (A) IN GENERAL.—In this subsection, the

3 term ‘‘approved clinical trial’’ means a clinical

4 research study or clinical investigation approved

5 and funded (which may include funding through

6 in-kind contributions) by one or more of the fol7 lowing:

8 (i) The National Institutes of Health.

9 (ii) A cooperative group or center of

10 the National Institutes of Health.

11 (iii) Either of the following if the con12 ditions described in subparagraph (B) are

13 met:

14 (I) The Department of Veterans

15 Affairs.

16 (II) The Department of Defense.

17 (B) CONDITIONS FOR DEPARTMENTS.—

18 The conditions described in this subparagraph,

19 for a study or investigation conducted by a De20 partment, are that the study or investigation

21 has been reviewed and approved through a sys22 tem of peer review that the Secretary

23 determines—

24 (i) to be comparable to the system of

25 peer review of studies and investigations
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1 used by the National Institutes of Health,

2 and

3 (ii) assures unbiased review of the

4 highest scientific standards by qualified in5 dividuals who have no interest in the out6 come of the review.

7 (5) CONSTRUCTION.—Nothing in this sub8 section shall be construed to limit a plan’s or

9 issuer’s coverage with respect to clinical trials.

10 (b) ACCESS TO PRESCRIPTION DRUGS.—

11 (1) IN GENERAL.—If a group health plan, or

12 health insurance issuer that offers health insurance

13 coverage, provides benefits with respect to prescrip14 tion drugs but the coverage limits such benefits to

15 drugs included in a formulary, the plan or issuer

16 shall—

17 (A) ensure participation of participating

18 physicians and pharmacists in the development

19 of the formulary; and

20 (B) disclose to providers and, disclose upon

21 request under section 111(c)(5) to participants,

22 beneficiaries, and enrollees, the nature of the

23 formulary restrictions; and

24 (C) consistent with the standards for a uti25 lization review program under section 102(a),
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1 provide for exceptions from the formulary limi2 tation when a non-formulary alternative is

3 medically indicated.

4 (2) CONSTRUCTION.—Nothing in this sub5 section shall be construed as requiring a group

6 health plan (or health insurance issuer in connection

7 with health insurance coverage) to provide any cov8 erage of prescription drugs or as preventing such a

9 plan or issuer from negotiating higher cost-sharing

10 in the case a non-formulary alternative is provided

11 under paragraph (1)(C).

12 SEC. 124. NONDISCRIMINATION IN DELIVERY OF SERVICES.

13 (a) APPLICATION TO DELIVERY OF SERVICES.—Sub14 ject to subsection (b), a group health plan, and health in15 surance issuer in relation to health insurance coverage,

16 may not discriminate against a participant, beneficiary, or

17 enrollee in the delivery of health care services consistent

18 with the benefits covered under the plan or coverage or

19 as required by law based on race, color, ethnicity, national

20 origin, religion, sex, age, mental or physical disability, sex21 ual orientation, genetic information, or source of payment.

22 (b) CONSTRUCTION.—Nothing in subsection (a) shall

23 be construed as relating to the eligibility to be covered,

24 or the offering (or guaranteeing the offer) of coverage,

25 under a plan or health insurance coverage, the application
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1 of any pre-existing condition exclusion consistent with ap2 plicable law, or premiums charged under such plan or cov3 erage. To the extent that health care providers are per4 mitted under State and Federal law to prioritize the ad5 mission or treatment of patients based on such patients’

6 individual religious affiliation, group health plans and

7 health insurance issuers may reflect those priorities in re8 ferring patients to such providers.

9 SEC. 125. PROHIBITION OF INTERFERENCE WITH CERTAIN

10 MEDICAL COMMUNICATIONS.

11 (a) IN GENERAL.—An organization on behalf of a

12 group health plan (as described in subsection (a)(2)) or

13 a health insurance issuer shall not penalize (financially or

14 otherwise) a health care professional for advocating on be15 half of his or her patient or for providing information or

16 referral for medical care (as defined in section 2791(a)(2)

17 of the Public Health Service Act) consistent with the

18 health care needs of the patient and with the code of ethi19 cal conduct, professional responsibility, conscience, medi20 cal knowledge, and license of the health care professional.

21 (b) CONSTRUCTION.—Nothing in subsection (a) shall

22 be construed as requiring a health insurance issuer or a

23 group health plan to pay for medical care not otherwise

24 paid for or covered by the plan provided by nonparticipat25 ing health care professionals, except in those instances and
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1 to the extent that the issuer or plan would normally pay

2 for such medical care.

3 (c) ASSISTANCE AND SUPPORT.—A group health plan

4 or a health insurance issuer shall not prohibit or otherwise

5 restrict a health care professional from providing letters

6 of support to, or in any way assisting, enrollees who are

7 appealing a denial, termination, or reduction of service in

8 accordance with the procedures under subtitle A.

9 SEC. 126. PROVIDER INCENTIVE PLANS.

10 (a) PROHIBITION OF TRANSFER OF INDEMNIFICA11 TION.—

12 (1) IN GENERAL.—No contract or agreement

13 between a group health plan or health insurance

14 issuer (or any agent acting on behalf of such a plan

15 or issuer) and a health care provider shall contain

16 any provision purporting to transfer to the health

17 care provider by indemnification or otherwise any li18 ability relating to activities, actions, or omissions of

19 the plan, issuer, or agent (as opposed to the pro20 vider).

21 (2) NULLIFICATION.—Any contract or agree22 ment provision described in paragraph (1) shall be

23 null and void.

24 (b) PROHIBITION OF IMPROPER PHYSICIAN INCEN25 TIVE PLANS.—
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1 (1) IN GENERAL.—A group health plan and a

2 health insurance issuer offering health insurance

3 coverage may not operate any physician incentive

4 plan (as defined in subparagraph (B) of section

5 1876(i)(8) of the Social Security Act) unless the re6 quirements described in subparagraph (A) of such

7 section are met with respect to such a plan.

8 (2) APPLICATION.—For purposes of carrying

9 out paragraph (1), any reference in section

10 1876(i)(8) of the Social Security Act to the Sec11 retary, an eligible organization, or an individual en12 rolled with the organization shall be treated as a ref13 erence to the applicable authority, a group health

14 plan or health insurance issuer, respectively, and a

15 participant, beneficiary, or enrollee with the plan or

16 organization, respectively.

17 SEC. 127. PROVIDER PARTICIPATION.

18 (a) IN GENERAL.—A group health plan and a health

19 insurance issuer that offers health insurance coverage

20 shall, if it provides benefits through participating health

21 care professionals, have a written process for the selection

22 of participating health care professionals under the plan

23 or coverage. Such process shall include—

24 (1) minimum professional requirements;
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1 (2) providing notice of the rules regarding par2 ticipation;

3 (3) providing written notice of participation de4 cisions that are adverse to professionals; and

5 (4) providing a process within the plan or issuer

6 for appealing such adverse decisions, including the

7 presentation of information and views of the profes8 sional regarding such decision.

9 (b) VERIFICATION OF BACKGROUND.—Such process

10 shall include verification of a health care provider’s license

11 and a history of suspension or revocation.

12 (c) RESTRICTION.—Such process shall not use a

13 high-risk patient base or location of a provider in an area

14 with residents with poorer health status as a basis for ex15 cluding providers from participation.

16 (d) GENERAL NONDISCRIMINATION.—

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

18 such process shall not discriminate with respect to

19 selection of a health care professional to be a partici20 pating health care provider, or with respect to the

21 terms and conditions of such participation, based on

22 the professional’s race, color, religion, sex, national

23 origin, age, sexual orientation, or disability (consist24 ent with the Americans with Disabilities Act of

25 1990).
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1 (2) RULES.—The appropriate Secretary may

2 establish such definitions, rules, and exceptions as

3 may be appropriate to carry out paragraph (1), tak4 ing into account comparable definitions, rules, and

5 exceptions in effect under employment-based non6 discrimination laws and regulations that relate to

7 each of the particular bases for discrimination de8 scribed in such paragraph.

9 SEC. 128. REQUIRED COVERAGE FOR APPROPRIATE HOS10 PITAL STAY FOR MASTECTOMIES AND LYMPH

11 NODE DISSECTIONS FOR THE TREATMENT OF

12 BREAST CANCER.

13 (a) COVERAGE OF INPATIENT CARE FOR SURGICAL

14 TREATMENT OF BREAST CANCER.—

15 (1) IN GENERAL.—A group health plan, and a

16 health insurance issuer providing health insurance

17 coverage, that provides medical and surgical benefits

18 shall ensure that inpatient coverage with respect to

19 the surgical treatment of breast cancer (including a

20 mastectomy, lumpectomy, or lymph node dissection

21 for the treatment of breast cancer) is provided for

22 a period of time as is determined by the attending

23 physician, in his or her professional judgment con24 sistent with generally accepted principles of profes-
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1 sional medical practice, in consultation with the pa2 tient, to be medically necessary or appropriate.

3 (2) EXCEPTION.—Nothing in this section shall

4 be construed as requiring the provision of inpatient

5 coverage if the attending physician in consultation

6 with the patient determine that a shorter period of

7 hospital stay is medically necessary or appropriate.

8 (b) NO AUTHORIZATION REQUIRED.—

9 (1) IN GENERAL.—An attending physician shall

10 not be required to obtain authorization from the

11 plan or issuer for prescribing any length of stay in

12 connection with a mastectomy, a lumpectomy, or a

13 lymph node dissection for the treatment of breast

14 cancer.

15 (2) PRENOTIFICATION.—Nothing in this section

16 shall be construed as preventing a group health plan

17 or health insurance issuer from requiring

18 prenotification of an inpatient stay referred to in

19 this section if such requirement is consistent with

20 terms and conditions applicable to other inpatient

21 benefits under the plan or health insurance coverage,

22 except that the provision of such inpatient stay bene23 fits shall not be contingent upon such notification.
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1 (c) PROHIBITIONS.—A group health plan and a

2 health insurance issuer offering health insurance coverage

3 may not—

4 (1) deny to a patient eligibility, or continued

5 eligibility, to enroll or to renew coverage under the

6 terms of the plan or coverage, solely for the purpose

7 of avoiding the requirements of this section;

8 (2) provide monetary payments or rebates to in9 dividuals to encourage such individuals to accept less

10 than the minimum protections available under this

11 section;

12 (3) penalize or otherwise reduce or limit the re13 imbursement of an attending provider because such

14 provider provided care to an individual participant,

15 beneficiary, or enrollee in accordance with this sec16 tion;

17 (4) provide incentives (monetary or otherwise)

18 to an attending provider to induce such provider to

19 provide care to an individual participant, beneficiary,

20 or enrollee in a manner inconsistent with this sec21 tion; and

22 (5) subject to subsection (d)(2), restrict benefits

23 for any portion of a period within a hospital length

24 of stay required under subsection (a) in a manner
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1 which is less favorable than the benefits provided for

2 any preceding portion of such stay.

3 (d) RULES OF CONSTRUCTION.—

4 (1) IN GENERAL.—Nothing in this section shall

5 be construed to require a patient who is a partici6 pant, beneficiary, or enrollee—

7 (A) to undergo a mastectomy or lymph

8 node dissection in a hospital; or

9 (B) to stay in the hospital for a fixed pe10 riod of time following a mastectomy or lymph

11 node dissection.

12 (2) COST SHARING.—Nothing in this section

13 shall be construed as preventing a group health plan

14 or issuer from imposing deductibles, coinsurance, or

15 other cost-sharing in relation to benefits for hospital

16 lengths of stay in connection with a mastectomy or

17 lymph node dissection for the treatment of breast

18 cancer under the plan or health insurance coverage,

19 except that such coinsurance or other cost-sharing

20 for any portion of a period within a hospital length

21 of stay required under subsection (a) may not be

22 greater than such coinsurance or cost-sharing for

23 any preceding portion of such stay.

24 (3) LEVEL AND TYPE OF REIMBURSEMENTS.—

25 Nothing in this section shall be construed to prevent
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1 a group health plan or a health insurance issuer

2 from negotiating the level and type of reimburse3 ment with a provider for care provided in accordance

4 with this section.

5 SEC. 129. PROMOTING GOOD MEDICAL PRACTICE.

6 (a) PROHIBITING ARBITRARY LIMITATIONS OR CON7 DITIONS FOR THE PROVISION OF SERVICES.—

8 (1) IN GENERAL.—A group health plan, and a

9 health insurance issuer in connection with the provi10 sion of health insurance coverage, may not arbitrar11 ily interfere with or alter the decision of the treating

12 physician regarding the manner or setting in which

13 particular services are delivered if the services are

14 medically necessary or appropriate for treatment or

15 diagnosis to the extent that such treatment or diag16 nosis is otherwise a covered benefit.

17 (2) CONSTRUCTION.—Paragraph (1) shall not

18 be construed as prohibiting a plan or issuer from

19 limiting the delivery of services to one or more

20 health care providers within a network of such pro21 viders.

22 (3) MANNER OR SETTING DEFINED.—In para23 graph (1), the term ‘‘manner or setting’’ means the

24 location of treatment, such as whether treatment is

25 provided on an inpatient or outpatient basis, and the
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1 duration of treatment, such as the number of days

2 in a hospital. Such term does not include the cov3 erage of a particular service or treatment.

4 (b) NO CHANGE IN COVERAGE.—Subsection (a) shall

5 not be construed as requiring coverage of particular serv6 ices the coverage of which is otherwise not covered under

7 the terms of the plan or coverage or from conducting utili8 zation review activities consistent with this subsection.

9 (c) MEDICAL NECESSITY OR APPROPRIATENESS DE10 FINED.—In subsection (a), the term ‘‘medically necessary

11 or appropriate’’ means, with respect to a service or benefit,

12 a service or benefit which is consistent with generally ac13 cepted principles of professional medical practice.

14 Subtitle D—Enhanced Enforcement

15 Authority

16 SEC. 141. INVESTIGATIONS AND REPORTING AUTHORITY,

17 INJUNCTIVE RELIEF AUTHORITY, AND IN18 CREASED CIVIL MONEY PENALTY AUTHORITY

19 FOR SECRETARY OF HEALTH AND HUMAN

20 SERVICES FOR VIOLATIONS OF PATIENT PRO21 TECTION STANDARDS.

22 (a) INVESTIGATIONS AND REPORTING AUTHORITY.—

23 (1) IN GENERAL.—For purposes of carrying out

24 sections 2722(b) and 2761(b) of the Public Health

25 Service Act with respect to enforcement of the provi-
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1 sions of sections 2707 and 2753, respectively, of

2 such Act (as added by title II of this Act)—

3 (A) the Secretary of Health and Human

4 Services shall have the same authorities with

5 respect to compelling health insurance issuers

6 to produce information and to conducting inves7 tigations in cases of violations of such provi8 sions as the Secretary of Labor has under sec9 tion 504 of the Employee Retirement Income

10 Security Act of 1974 with respect to violations

11 of title I of such Act; and

12 (B) section 504(c) of the Employee Retire13 ment Income Security Act of 1974 shall apply

14 to investigations conducted under paragraph (1)

15 in the same manner as it applies to investiga16 tions conducted under title I of such Act.

17 (2) REPORTING AUTHORITY.—In exercising au18 thority under paragraph (1), the Secretary may

19 require—

20 (A) States that have indicated an intention

21 to assume authority under section 2722(a)(1)

22 or 2761(a) of the Public Health Service Act to

23 report to the Secretary on enforcement efforts

24 undertaken to assure compliance with the re-
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1 quirements of sections 2707 and 2753, respec2 tively, of such Act; and

3 (B) health insurance issuers to submit re4 ports to assure compliance with such require5 ments.

6 (b) AUTHORITY FOR INJUNCTIVE RELIEF.—In addi7 tion to the authority referred to in subsection (a), the Sec8 retary of Health and Human Services has the same au9 thority with respect to enforcement of the provisions of

10 this title as the Secretary of Labor has under subsection

11 (a)(5) of section 502 of the Employee Retirement Income

12 Security Act of 1974 (as applied without regard to sub13 section (b) of that section) and the related provisions of

14 part 5 of subtitle B of title I of such Act with respect

15 to enforcement of such title I of such Act.

16 (c) INCREASE IN CIVIL MONEY PENALTIES.—

17 (1) IN GENERAL.—In the case of a civil money

18 penalty that may be imposed under section

19 2722(b)(2) or 2761(b) of the Public Health Service

20 Act with respect to a failure to meet the provisions

21 of sections 2707 and 2753, respectively, of such Act,

22 the maximum amount of penalty otherwise provided

23 under section 2722(b)(2)(C)(i) of such Act may, not24 withstanding the amounts specified in such section,
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1 and subject to paragraph (2), be up to the greatest

2 of the following:

3 (A) FAILURES INVOLVING UNREASONABLE

4 DENIAL OR DELAY IN BENEFITS IMPACTING ON

5 LIFE OR HEALTH.—In the case of a failure that

6 results in an unreasonable denial or delay in

7 benefits that has seriously jeopardized (or has

8 substantial likelihood of seriously jeopardizing)

9 the individual’s life, health, or ability to regain

10 or maintain maximum function or (in the case

11 of a child under the age of 6) development, the

12 greater of the following:—

13 (i) PATTERN OR PRACTICE FAIL14 URE.—If the failure reflects a pattern or

15 practice of wrongful conduct, $250,000,

16 plus the amount (if any) determined under

17 paragraph (2).

18 (ii) OTHER FAILURES.—In the case of

19 a failure that does not reflect a pattern or

20 practice of wrongful conduct, $50,000 for

21 each individual involved, plus the amount

22 (if any) determined under paragraph (2).

23 (B) OTHER FAILURES.—In the case of a

24 failure not described in subparagraph (A), the

25 greater of the following:
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1 (i) PATTERN AND PRACTICE FAIL2 URES.—In the case of a failure that re3 flects a pattern or practice of wrongful

4 conduct $50,000, plus the amount (if any)

5 determined under paragraph (2).

6 (ii) OTHER FAILURES.—In the case of

7 a failure that does not reflect a pattern or

8 practice of wrongful conduct, $10,000 for

9 each individual involved, plus the amount

10 (if any) determined under paragraph (2).

11 (2) CONTINUING FAILURE WITHOUT CORREC12 TION.—In the case of a failure which is not cor13 rected within the first week beginning with the date

14 on which the failure is established, the maximum

15 amount of the penalty under paragraph (1) shall be

16 increased by $10,000 for each full succeeding week

17 in which the failure is not so corrected.

18 (d) AUTHORIZATION OF APPROPRIATIONS.—In addi19 tion to any other amounts authorized to be appropriated,

20 there are authorized to be appropriated to the Secretary

21 of Health and Human Services such sums as may be nec22 essary to carry out this section.
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1 SEC. 142. AUTHORITY FOR SECRETARY OF LABOR TO IM2 POSE CIVIL PENALTIES FOR VIOLATIONS OF

3 PATIENT PROTECTION STANDARDS.

4 (a) IN GENERAL.—Section 502(c) of the Employee

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

6 1132(c)) is amended by redesignating paragraphs (6) and

7 (7) as paragraphs (7) and (8), respectively, and by insert8 ing after paragraph (5) the following new paragraph:

9 ‘‘(6)(A) The Secretary may assess a civil penalty

10 against a person acting in the capacity of a fiduciary of

11 a group health plan (as defined in 733(a)) so as to cause

12 a violation of section 714.

13 ‘‘(B) Subject to subparagraph (C), the maximum

14 amount which may be assessed under subparagraph (A)

15 is the greatest of the following:

16 ‘‘(i) In the case of a failure that results in an

17 unreasonable denial or delay in benefits that seri18 ously jeopardized (or has substantial likelihood of se19 riously jeopardizing) the individual’s life, health, or

20 ability to regain or maintain maximum function or

21 (in the case of a child under the age of 6) develop22 ment, the greater of the following:

23 ‘‘(I) If the failure reflects a pattern or

24 practice of wrongful conduct, $250,000, plus

25 the amount (if any) determined under subpara26 graph (C).
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1 ‘‘(II) In the case of a failure that does not

2 reflect a pattern or practice of wrongful con3 duct, $50,000 for each individual involved, plus

4 the amount (if any) determined under subpara5 graph (C).

6 ‘‘(ii) In the case of a failure not described in

7 clause (i), the greater of the following:

8 ‘‘(I) In the case of a failure that reflects

9 a pattern or practice of wrongful conduct

10 $50,000, plus the amount (if any) determined

11 under subparagraph (C).

12 ‘‘(II) In the case of a failure that does not

13 reflect a pattern or practice of wrongful con14 duct, $10,000 for each individual involved, plus

15 the amount (if any) determined under subpara16 graph (C).

17 ‘‘(C) In the case of a failure which is not corrected

18 within the first week beginning with the date on which

19 the failure is established, the maximum amount of the

20 penalty under subparagraph (B) shall be increased by

21 $10,000 for each full succeeding week in which the failure

22 is not so corrected.’’.

23 (b) CONFORMING AMENDMENT.—Section 502(a)(6)

24 of such Act (29 U.S.C. 1132(a)(6)) is amended by striking
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1 ‘‘paragraph (2), (4), (5), or (6)’’ and inserting ‘‘paragraph

2 (2), (4), (5), (6), or (7)’’.

3 (c) AUTHORIZATION OF APPROPRIATIONS.—In addi4 tion to any other amounts authorized to be appropriated,

5 there are authorized to be appropriated to the Secretary

6 of Labor such sums as may be necessary to carry out the

7 amendments made by this section.

8 TITLE II—PATIENT PROTECTION

9 STANDARDS UNDER PUBLIC

10 HEALTH SERVICE ACT

11 SEC. 201. APPLICATION TO GROUP HEALTH PLANS AND

12 GROUP HEALTH INSURANCE COVERAGE.

13 (a) IN GENERAL.—Subpart 2 of part A of title

14 XXVII of the Public Health Service Act, as amended by

15 the Omnibus Consolidated and Emergency Supplemental

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

17 amended by adding at the end the following new section:

18 ‘‘SEC. 2707. PATIENT PROTECTION STANDARDS.

19 ‘‘(a) IN GENERAL.—Each group health plan shall

20 comply with patient protection requirements under title I

21 of the Promoting Responsible Managed Care Act of 1999,

22 and each health insurance issuer shall comply with patient

23 protection requirements under such title with respect to

24 group health insurance coverage it offers, and such re-
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1 quirements shall be deemed to be incorporated into this

2 subsection.

3 ‘‘(b) NOTICE.—A group health plan shall comply with

4 the notice requirement under section 711(d) of the Em5 ployee Retirement Income Security Act of 1974 with re6 spect to the requirements referred to in subsection (a) and

7 a health insurance issuer shall comply with such notice

8 requirement as if such section applied to such issuer and

9 such issuer were a group health plan.’’.

10 (b) CONFORMING AMENDMENT.—Section

11 2721(b)(2)(A) of such Act (42 U.S.C. 300gg–21(b)(2)(A))

12 is amended by inserting ‘‘(other than section 2707)’’ after

13 ‘‘requirements of such subparts’’.

14 (c) REFERENCE TO ENHANCED ENFORCEMENT AU15 THORITY.—For provisions providing for enhanced author16 ity to enforce the patient protection requirements of title

17 I under the Public Health Service Act, see section 141.

18 SEC. 202. APPLICATION TO INDIVIDUAL HEALTH INSUR19 ANCE COVERAGE.

20 Part B of title XXVII of the Public Health Service

21 Act, as amended by the Omnibus Consolidated and Emer22 gency Supplemental Appropriations Act, 1999 (Public

23 Law 105-277), is amended by inserting after section 2753

24 the following new section:
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1 ‘‘SEC. 2753. PATIENT PROTECTION STANDARDS.

2 ‘‘(a) IN GENERAL.—Each health insurance issuer

3 shall comply with patient protection requirements under

4 title I of the Promoting Responsible Managed Care Act

5 of 1999 with respect to individual health insurance cov6 erage it offers, and such requirements shall be deemed to

7 be incorporated into this subsection.

8 ‘‘(b) NOTICE.—A health insurance issuer under this

9 part shall comply with the notice requirement under sec10 tion 711(d) of the Employee Retirement Income Security

11 Act of 1974 with respect to the requirements of such title

12 as if such section applied to such issuer and such issuer

13 were a group health plan.’’.

14 TITLE III—PATIENT PROTEC15 TION STANDARDS UNDER

16 THE EMPLOYEE RETIREMENT

17 INCOME SECURITY ACT OF

18 1974

19 SEC. 301. APPLICATION OF PATIENT PROTECTION STAND20 ARDS TO GROUP HEALTH PLANS AND GROUP

21 HEALTH INSURANCE COVERAGE UNDER THE

22 EMPLOYEE RETIREMENT INCOME SECURITY

23 ACT OF 1974.

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

25 B of title I of the Employee Retirement Income Security

26 Act of 1974, as amended by the Omnibus Consolidated
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1 and Emergency Supplemental Appropriations Act, 1999

2 (Public Law 105–277), is amended by adding at the end

3 the following new section:

4 ‘‘SEC. 714. PATIENT PROTECTION STANDARDS.

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

6 group health plan (and a health insurance issuer offering

7 group health insurance coverage in connection with such

8 a plan) shall comply with the requirements of title I of

9 the Promoting Responsible Managed Care Act of 1999 (as

10 in effect as of the date of the enactment of such Act),

11 and such requirements shall be deemed to be incorporated

12 into this subsection.

13 ‘‘(b) PLAN SATISFACTION OF CERTAIN REQUIRE14 MENTS.—

15 ‘‘(1) SATISFACTION OF CERTAIN REQUIRE16 MENTS THROUGH INSURANCE.—For purposes of

17 subsection (a), insofar as a group health plan pro18 vides benefits in the form of health insurance cov19 erage through a health insurance issuer, the plan

20 shall be treated as meeting the following require21 ments of title I of the Promoting Responsible Man22 aged Care Act of 1999 with respect to such benefits

23 and not be considered as failing to meet such re24 quirements because of a failure of the issuer to meet

25 such requirements so long as the plan sponsor or its
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1 representatives did not cause such failure by the

2 issuer:

3 ‘‘(A) Section 121 (relating to access to

4 emergency care).

5 ‘‘(B) Section 122 (relating to choice of

6 providers).

7 ‘‘(C) Section 122(b) (relating to specialized

8 services).

9 ‘‘(D) Section 122(c)(1)(A) (relating to con10 tinuity in case of termination of provider con11 tract) and section 122(c)(1)(B) (relating to

12 continuity in case of termination of issuer con13 tract), but only insofar as a replacement issuer

14 assumes the obligation for continuity of care.

15 ‘‘(E) Section 123(a) (relating to coverage

16 for individuals participating in approved clinical

17 trials.)

18 ‘‘(F) Section 123(b) (relating to access to

19 needed prescription drugs).

20 ‘‘(G) Section 122(e) (relating to adequacy

21 of provider network).

22 ‘‘(H) Subtitle B (relating to consumer in23 formation).

24 ‘‘(2) INFORMATION.—With respect to informa25 tion required to be provided or made available under
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1 section 111 of such Act, in the case of a group

2 health plan that provides benefits in the form of

3 health insurance coverage through a health insur4 ance issuer, the Secretary shall determine the cir5 cumstances under which the plan is not required to

6 provide or make available the information (and is

7 not liable for the issuer’s failure to provide or make

8 available the information), if the issuer is obligated

9 to provide and make available (or provides and

10 makes available) such information.

11 ‘‘(3) GRIEVANCE AND INTERNAL APPEALS.—

12 With respect to the grievance system and internal

13 appeals process required to be established under sec14 tions 102 and 103 of such Act, in the case of a

15 group health plan that provides benefits in the form

16 of health insurance coverage through a health insur17 ance issuer, the Secretary shall determine the cir18 cumstances under which the plan is not required to

19 provide for such system and process (and is not lia20 ble for the issuer’s failure to provide for such system

21 and process), if the issuer is obligated to provide for

22 (and provides for) such system and process.

23 ‘‘(4) EXTERNAL APPEALS.—Pursuant to rules

24 of the Secretary, insofar as a group health plan en25 ters into a contract with a qualified external appeal
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1 entity for the conduct of external appeal activities in

2 accordance with section 106 of such Act, the plan

3 shall be treated as meeting the requirement of such

4 section and is not liable for the entity’s failure to

5 meet any requirements under such section.

6 ‘‘(5) APPLICATION TO PROHIBITIONS.—Pursu7 ant to rules of the Secretary, if a health insurance

8 issuer offers health insurance coverage in connection

9 with a group health plan and takes an action in vio10 lation of any of the following sections of such Act,

11 the group health plan shall not be liable for such

12 violation unless the plan caused such violation:

13 ‘‘(A) Section 124 (relating to non14 discrimination in delivery of services).

15 ‘‘(B) Section 125 (relating to prohibition

16 of interference with certain medical communica17 tions).

18 ‘‘(C) Section 126 (relating to provider in19 centive plans).

20 ‘‘(D) Section 102(b) (relating to providing

21 medically necessary care).

22 ‘‘(6) CONSTRUCTION.—Nothing in this sub23 section shall be construed to affect or modify the re24 sponsibilities of the fiduciaries of a group health

25 plan under part 4 of subtitle B.
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1 (b) SATISFACTION OF ERISA CLAIMS PROCEDURE

2 REQUIREMENT.—Section 503 of such Act (29 U.S.C.

3 1133) is amended by inserting ‘‘(a)’’ after ‘‘SEC. 503.’’

4 and by adding at the end the following new subsection:

5 ‘‘(b) In the case of a group health plan (as defined

6 in section 733) compliance with the requirements of sub7 title D (and section 113) of title I of the Promoting Re8 sponsible Managed Care Act of 1999 in the case of a

9 claims denial shall be deemed compliance with subsection

10 (a) with respect to such claims denial.’’.

11 (c) CONFORMING AMENDMENTS.—(1) Section 732(a)

12 of such Act (29 U.S.C. 1185(a)) is amended by striking

13 ‘‘section 711’’ and inserting ‘‘sections 711 and 714’’.

14 (2) The table of contents in section 1 of such Act

15 is amended by inserting after the item relating to section

16 713 the following new item:

‘‘Sec. 714. Patient protection standards.’’.

17 (3) Section 502(b)(3) of such Act (29 U.S.C.

18 1132(b)(3)) is amended by inserting ‘‘(other than section

19 144(b))’’ after ‘‘part 7’’.

20 (d) REFERENCE TO ENHANCED ENFORCEMENT AU21 THORITY.—For provisions providing for enhanced author22 ity to enforce the patient protection requirements of title

23 I under the Employee Retirement Income Security Act of

24 1974, see section 142.
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1 SEC. 302. ENFORCEMENT FOR ECONOMIC LOSS CAUSED BY

2 COVERAGE DETERMINATIONS.

3 (a) IN GENERAL.—Section 502(c) of the Employee

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

5 1132), as amended by section 142(a) of this Act, is

6 amended by redesignating paragraphs (7) and (8) as para7 graphs (8) and (9), respectively, and by inserting after

8 paragraph (6) the following new paragraph:

9 ‘‘(7)(A) In any case in which—

10 ‘‘(i) a coverage determination (as defined in

11 section 101(a)(2) of the Promoting Responsible

12 Managed Care Act of 1999) under a group health

13 plan (as defined in section 503(b)(8)) is not made

14 on a timely basis or is made on such a basis but is

15 not made in accordance with the terms of the plan,

16 this title, or title I of such Act, and

17 ‘‘(ii) a participant or beneficiary suffers per18 sonal injury (including loss of life, health, or the

19 ability to regain or maintain maximum function or

20 (in the case of a child under the age of 6) develop21 ment) as a result of such coverage determination,

22 any person or persons who are responsible under the terms

23 of the plan for the making of such coverage determination

24 are liable to the aggrieved participant or beneficiary for

25 the amount of the economic loss suffered by the partici26 pant or beneficiary caused by such coverage determina-
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1 tion. Any question of fact in any cause of action under

2 this paragraph shall be based on the preponderance of the

3 evidence after de novo review.

4 ‘‘(B) For purposes of subparagraph (A), the term

5 ‘economic loss’ means any pecuniary loss (including the

6 loss of earnings or other benefits related to employment,

7 medical expense loss, replacement services loss, loss due

8 to death, burial costs, and loss of business or employment

9 opportunities) caused by the coverage determination. Such

10 term does not include punitive damages or damages for

11 pain and suffering, inconvenience, emotional distress,

12 mental anguish, loss of consortium, injury to reputation,

13 humiliation, and other nonpecuniary losses.

14 ‘‘(C) Nothing in this paragraph shall be construed as

15 requiring exhaustion of administrative process in the case

16 of severe bodily injury or death.

17 ‘‘(D) For purposes of subparagraph (A), the term

18 ‘personal injury’ means a physical injury and includes an

19 injury arising out of the treatment (or failure to treat)

20 a mental illness or disease.’’.

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

22 subsection (a) apply to coverage determinations made on

23 or after the date of the enactment of this Act.
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1 TITLE IV—PATIENT PROTEC2 TION STANDARDS UNDER

3 THE INTERNAL REVENUE

4 CODE OF 1986

5 SEC. 401. AMENDMENTS TO THE INTERNAL REVENUE CODE

6 OF 1986

7 Subchapter B of chapter 100 of the Internal Revenue

8 Code of 1986 (as amended by section 1531(a) of the Tax9 payer Relief Act of 1997) is amended—

10 (1) in the table of sections, by inserting after

11 the item relating to section 9812 the following new

12 item:

‘‘Sec. 9813. Standard relating to patient protection standards.’’;

and

13 (2) by inserting after section 9812 the follow14 ing:

15 ‘‘SEC. 9813. STANDARD RELATING TO PATIENT PROTEC16 TION STANDARDS.

17 ‘‘A group health plan shall comply with the require18 ments of title I of the Promoting Responsible Managed

19 Care Act of 1999 (as in effect as of the date of the enact20 ment of such Act), and such requirements shall be deemed

21 to be incorporated into this section.’’.
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1 TITLE V—EFFECTIVE DATES; CO2 ORDINATION IN IMPLEMEN3 TATION

4 SEC. 501. EFFECTIVE DATES.

5 (a) GROUP HEALTH COVERAGE.—

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

7 the amendments made by sections 201(a), 301, and

8 401 (and title I insofar as it relates to such sections)

9 shall apply with respect to group health plans, and

10 health insurance coverage offered in connection with

11 group health plans, for plan years beginning on or

12 after January 1, 2000 (in this section referred to as

13 the ‘‘general effective date’’) and also shall apply to

14 portions of plan years occurring on and after such

15 date.

16 (2) TREATMENT OF COLLECTIVE BARGAINING

17 AGREEMENTS.—In the case of a group health plan

18 maintained pursuant to 1 or more collective bargain19 ing agreements between employee representatives

20 and 1 or more employers ratified before the date of

21 enactment of this Act, the amendments made by sec22 tions 201(a), 301, and 401 (and title I insofar as it

23 relates to such sections) shall not apply to plan

24 years beginning before the later of—
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1 (A) the date on which the last collective

2 bargaining agreement relating to the plan ter3 minates (determined without regard to any ex4 tension thereof agreed to after the date of en5 actment of this Act), or

6 (B) the general effective date.

7 For purposes of subparagraph (A), any plan amend8 ment made pursuant to a collective bargaining

9 agreement relating to the plan which amends the

10 plan solely to conform to any requirement added by

11 this Act shall not be treated as a termination of

12 such collective bargaining agreement.

13 (b) INDIVIDUAL HEALTH INSURANCE COVERAGE.—

14 The amendments made by section 202 shall apply with

15 respect to individual health insurance coverage offered,

16 sold, issued, renewed, in effect, or operated in the individ17 ual market on or after the general effective date.

18 SEC. 502. COORDINATION IN IMPLEMENTATION.

19 Section 104(1) of Health Insurance Portability and

20 Accountability Act of 1996 is amended by striking ‘‘this

21 subtitle (and the amendments made by this subtitle and

22 section 401)’’ and inserting ‘‘the provisions of part 7 of

23 subtitle B of title I of the Employee Retirement Income

24 Security Act of 1974, the provisions of parts A and C of

25 title XXVII of the Public Health Service Act, chapter 100
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1 of the Internal Revenue Code of 1986, and title I of the

2 Promoting Responsible Managed Care Act of 1999’’.

Æ