II

105TH CONGRESS

2D SESSION S. 1712

To amend title XXVII of the Public Health Service Act and part 7 of

subtitle B of title I of the Employee Retirement Income Security Act

of 1974 to improve the quality of health plans and provide protections

for consumers enrolled in such plans.

IN THE SENATE OF THE UNITED STATES

MARCH 5, 1998

Mr. JEFFORDS (for himself and Mr. LIEBERMAN) introduced the following

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

Human Resources

A BILL

To amend title XXVII of the Public Health Service Act

and part 7 of subtitle B of title I of the Employee

Retirement Income Security Act of 1974 to improve the

quality of health plans and provide protections for consumers enrolled in such plans.

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 ‘‘Health Care Quality, Education, Security, and Trust

6 Act’’ or the ‘‘Health Care QUEST Act’’.
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1 (b) TABLE OF CONTENTS.—The table of contents of

2 this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Findings and purpose.

Sec. 3. Definitions.

Sec. 4. Effect on other laws.

TITLE I—HEALTH QUALITY OVERSIGHT

Sec. 101. Health Quality Council.

Sec. 102. Members of the Council.

Sec. 103. Personnel matters.

Sec. 104. Powers.

Sec. 105. General duties.

Sec. 106. National benchmarks of quality.

Sec. 107. National report cards.

Sec. 108. Evaluating provider quality in fee-for-service.

Sec. 109. Studies.

Sec. 110. Authorization of appropriations.

TITLE II—QUALITY IMPROVEMENT

Sec. 201. Investment in quality measurement.

‘‘Sec. 915. National health care quality information.

TITLE III—HEALTH CARE INFORMATION

Subtitle A—Plan Sponsor Responsibilities

Sec. 301. Employee Retirement Income Security Act of 1974.

Subtitle B—Health Plan Requirements And Consumer Protection

Sec. 311. Amendment to Public Health Service Act.

‘‘PART C—PROTECTION FOR CONSUMERS

‘‘Sec. 2770. Exemption.

‘‘SUBPART 1—CONSUMER INFORMATION

‘‘Sec. 2771. Health plan comparative information.

‘‘SUBPART 2—CONSUMER PROTECTION AND PLAN STANDARDS

‘‘Sec. 2775. Emergency services.

‘‘Sec. 2776. Advance directives and organ donation.

‘‘Sec. 2777. Coverage determination, grievances and appeals.

‘‘Sec. 2778. Confidentiality and accuracy of enrollees records.

‘‘SUBPART 3—HEALTH CARE PROFESSIONAL PROTECTIONS

‘‘Sec. 2781. Health care professional communications.

Sec. 312. Amendments to the Employee Retirement Income Security Act of

1974.

‘‘SUBPART B—PROTECTION FOR CONSUMERS
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‘‘Sec. 720. Exemption.

‘‘CHAPTER 1—CONSUMER INFORMATION

‘‘Sec. 721. Health plan comparative information.

‘‘CHAPTER 2—CONSUMER PROTECTION AND PLAN STANDARDS

‘‘Sec. 725. Emergency services.

‘‘Sec. 726. Advance directives and organ donation.

‘‘Sec. 727. Coverage determination, grievances and appeals.

‘‘Sec. 728. Confidentiality and accuracy of participants and beneficiaries

records.

‘‘CHAPTER 3—HEALTH CARE PROFESSIONAL PROTECTIONS

‘‘Sec. 730. Health care professional communications.

1 SEC. 2. FINDINGS AND PURPOSE.

2 (a) FINDINGS.—Congress makes the following find3 ings:

4 (1) While the health care delivered in the

5 United States is of high quality, the variations in

6 quality are large.

7 (2) The problems arising from the delivery of

8 poor health care quality are serious and raise the

9 cost of health care for all Americans.

10 (3) Health care quality can be defined and

11 measured, but additional resources are needed to

12 fully develop and implement the necessary tools.

13 (4) Inadequate information currently exists in

14 the health care marketplace to guide and inform

15 purchasing decisions.

16 (5) Health care professionals should act as ad17 vocates for their patients.
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1 (6) Coverage determinations should be made in

2 a timely manner.

3 (7) Procedures should be available to consumers

4 of health care for dispute resolution.

5 (8) Consumers of health care should be able to

6 access emergency services for those conditions when

7 a ‘‘prudent layperson’’ would be concerned that lack

8 of such services would result in serious con9 sequences.

10 (9) Currently, there is no unified strategy for

11 obtaining quality indicators for health care in the

12 fee-for-service market.

13 (b) PURPOSE.—It is the purpose of this Act to—

14 (1) provide for the continuous quality improve15 ment of the health care delivered in the United

16 States;

17 (2) provide for the development and implemen18 tation of the tools necessary to measure health care

19 quality;

20 (3) provide consumers with the information nec21 essary to guide and inform consumers regarding

22 health care purchasing decisions;

23 (4) ensure that health care professionals can

24 act as advocates for their patients;
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1 (5) provide consumers with timely coverage de2 cisions and defined procedures for appealing adverse

3 determinations; and

4 (6) provide a ‘‘prudent layperson’’ standard for

5 emergency care throughout the United States.

6 SEC. 3. DEFINITIONS.

7 (a) APPLICATION OF CERTAIN DEFINITIONS.—Ex8 cept as otherwise provided in subsection (b), the defini9 tions in section 2791 of the Public Health Service Act (42

10 U.S.C. 300gg–91) shall apply to this Act.

11 (b) OTHER DEFINITIONS.—In this Act:

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

13 Health Quality Council established under section

14 101.

15 (2) PLAN ADMINISTRATOR.—The term ‘‘plan

16 administrator’’ has the meaning given the term ‘‘ad17 ministrator’’ by section 3(16)(A) of the Employee

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

19 1002(16)(A)).

20 (3) PLAN FIDUCIARY.—The term ‘‘plan fidu21 ciary’’ means a person named as a fiduciary in ac22 cordance with section 402(a) of the Employee Re23 tirement Income Security Act of 1974 (42 U.S.C.

24 1102(a)).
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1 (4) PLAN SPONSOR.—The term ‘‘plan sponsor’’

2 has the meaning given that term by section

3 2791(d)(13) of the Public Health Service Act (42

4 U.S.C. 300gg–91(d)(13)).

5 SEC. 4. EFFECT ON OTHER LAWS.

6 (a) ERISA.—Nothing in this Act (or an amendment

7 made by this Act) shall be construed as affecting or modi8 fying section 514 of the Employee Retirement Income Se9 curity Act of 1974 (29 U.S.C. 1144) with respect to a

10 group health plan.

11 (b) PHSA.—Nothing in this Act (or an amendment

12 made by this Act) shall be construed to prohibit a State

13 from establishing, implementing or continuing in effect re14 quirements relating to the regulation of insurance as per15 mitted under section 514(b)(2)(A) of the Employee In16 come Security Act of 1974 (29 U.S.C. 1144(b)(2)(A)).

17 TITLE I—HEALTH QUALITY

18 OVERSIGHT

19 SEC. 101. HEALTH QUALITY COUNCIL.

20 There is established a council to be known as the

21 ‘‘Health Quality Council’’ to provide advice to the Presi22 dent and the Congress concerning health care quality and

23 to otherwise carry out the duties described in this title.

24 SEC. 102. MEMBERS OF THE COUNCIL.

25 (a) APPOINTMENT.—
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1 (1) IN GENERAL.—The Council shall be com2 posed of 9 members to be appointed by the Comp3 troller General from among individuals having exper4 tise relating to—

5 (A) the measurement and improvement of

6 the quality of health care;

7 (B) the purchase of health care in the pri8 vate sector;

9 (C) the purchase of health care in the pub10 lic sector (Federal and State);

11 (D) the delivery and provision of health

12 care;

13 (E) health economics;

14 (F) medical ethics; and

15 (G) the needs of participants and bene16 ficiaries in health care plans (including children

17 and individuals with disabilities).

18 (2) TERMS AND VACANCIES.—

19 (A) TERMS.—A member of the Council

20 (other than the Chairperson) shall be appointed

21 for a term of 4 years, except that of the mem22 bers initially appointed to the Council—

23 (i) 3 members shall be appointed for

24 a term of 1 year;
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1 (ii) 3 members shall be appointed for

2 a term of 2 years; and

3 (iii) 3 members shall be appointed for

4 a term of 3 years.

5 (B) LIMITATION.—At the expiration of the

6 term of office of a member of the Council ap7 pointed under subsection (a), that member shall

8 continue to hold office until a successor for

9 such member is appointed, except that such

10 member shall not continue to serve beyond the

11 expiration of the next session of Congress sub12 sequent to the expiration of the fixed term of

13 office.

14 (C) VACANCIES.—A vacancy in the mem15 bership of the Council shall not affect the pow16 ers of the Council and shall be filled in the

17 same manner as the original appointment, ex18 cept that any member appointed to fill a va19 cancy that occurs prior to the expiration of the

20 term for which the predecessor of the member

21 was appointed shall be appointed for the re22 mainder of such term.

23 (b) CHAIRPERSON.—The Comptroller General shall

24 select a Chairperson from among the members of the
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1 Council appointed under section (a)(1). A member may

2 not serve as Chairperson for longer than 8 years.

3 (c) EXECUTIVE DIRECTOR.—The Chairperson of the

4 Council shall appoint an individual to serve as the Execu5 tive Director of the Council. The Executive Director shall

6 serve at the discretion of the Chairperson.

7 (d) MEETINGS.—

8 (1) INITIAL MEETING.—Not later than 90 days

9 after the date on which all members of the Council

10 have been appointed, the Council shall hold its first

11 meeting.

12 (2) MEETINGS.—The Council shall meet at the

13 call of the Chairperson but in no case less than

14 quarterly.

15 (3) QUORUM.—A majority of the members of

16 the Council shall constitute a quorum, but a lesser

17 number of members may hold hearings.

18 (e) COMPENSATION OF MEMBERS.—

19 (1) FULL-TIME MEMBERS.—The Chairperson

20 and Executive Director of the Council shall be com21 pensated as provided for in title 5, United States

22 Code.

23 (2) OTHER MEMBERS.—Each member of the

24 Council not described in paragraph (1) who is not

25 an officer or employee of the Federal Government
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1 shall be compensated at a rate equal to the daily

2 equivalent of the annual rate of basic pay prescribed

3 for level IV of the Executive Schedule under section

4 5315 of title 5, United States Code, for each day

5 (including travel time) during which such member is

6 engaged in the performance of the duties of the

7 Council. All such members of the Council who are

8 officers or employees of the United States shall serve

9 without compensation in addition to that received for

10 their services as officers or employees of the United

11 States.

12 (3) TRAVEL EXPENSES.—The members of the

13 Council shall be allowed travel expenses, including

14 per diem in lieu of subsistence, at rates authorized

15 for employees of agencies under subchapter I of

16 chapter 57 of title 5, United States Code, while

17 away from their homes or regular places of business

18 in the performance of services for the Council.

19 (f) CONFLICT OF INTEREST.—The Chairperson and

20 the Executive Director of the Council shall not engage in

21 any other business, vocation, or employment than that of

22 serving as the Chairperson or Executive Director of the

23 Council.
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1 SEC. 103. PERSONNEL MATTERS.

2 (a) GENERAL SUPPORT.—Administrative and sci3 entific support for the Council shall be provided by the

4 Agency for Health Care Policy and Research.

5 (b) STAFF.—If determined necessary by the Council,

6 the Council may appoint and fix the compensation of such

7 officers and other experts and employees as may be nec8 essary for carrying out the functions of the Council under

9 this title and shall fix the salaries of such officers, experts,

10 and employees in accordance with chapter 51 and sub11 chapter III of chapter 53 of title 5, United States Code.

12 (c) DETAIL OF GOVERNMENT EMPLOYEES.—Any

13 Federal Government employee may be detailed to the

14 Council without reimbursement (other than the regular

15 compensation of the employee), and such detail shall be

16 without interruption or loss of civil service status or privi17 lege.

18 (d) PROCUREMENT OF TEMPORARY AND INTERMIT19 TENT SERVICES.—The Chairperson of the Council may

20 procure temporary and intermittent services under section

21 3109(b) of title 5, United States Code, at rates for individ22 uals which do not exceed the daily equivalent of the annual

23 rate of basic pay prescribed for level V of the Executive

24 Schedule under section 5316 of such title.

25 (e) LEASING AUTHORITY.—Notwithstanding any

26 other provision of law, the Council may enter directly into
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1 leases for real property for office, meeting, storage, and

2 such other space as may be necessary to carry out the

3 functions of the Council under this title, and shall be ex4 empt from any General Services Administration space

5 management regulations or directives.

6 (f) CONTRACTING AUTHORITY.—Notwithstanding

7 any other provision of law, the Council may enter directly

8 into contracts with entities as the Council determines nec9 essary to carry out the duties of the Council under this

10 title.

11 (g) ACCEPTANCE OF PAYMENTS.—

12 (1) IN GENERAL.—Notwithstanding any other

13 provision of law, in accordance with regulations

14 which the Council shall prescribe to prevent conflicts

15 of interest, the Council may accept payment and re16 imbursement, in cash or in kind, from non-Federal

17 agencies, organizations, and individuals for travel,

18 subsistence, and other necessary expenses incurred

19 by members of the Council in attending meetings

20 and conferences concerning the functions or activi21 ties of the Council.

22 (2) CREDIT OF ACCOUNT.—Any payment or re23 imbursement accepted shall be credited to the appro24 priated funds of the Council.
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1 SEC. 104. POWERS.

2 (a) HEARINGS.—The Council may hold such hear3 ings, sit and act at such times and places, take such testi4 mony, and receive such evidence as the Council considers

5 advisable to carry out the purposes of this title.

6 (b) ADVISORY COMMITTEES.—The Council may es7 tablish such advisory committees as the Council deter8 mines necessary to carry out its duties under this title.

9 (c) INFORMATION FROM FEDERAL AGENCIES.—The

10 Council may secure directly from any Federal department

11 or agency such information as the Council considers nec12 essary to carry out the provisions of this title. Upon re13 quest of the Chairperson of the Council, the head of such

14 department or agency shall furnish such information to

15 the Council. Any information furnished to the Council

16 under this subsection shall, upon the request of the de17 partment or agency, be kept confidential and be used only

18 for the purpose for which such information was provided.

19 (d) POSTAL SERVICES.—The Council may use the

20 United States mails in the same manner and under the

21 same conditions as other departments and agencies of the

22 Federal Government.

23 (e) GIFTS.—The Council may accept, use, and dis24 pose of gifts or donations of services or property.

25 SEC. 105. GENERAL DUTIES.

26 The Council shall—
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1 (1) serve as a resource for the appropriate com2 mittees of Congress and the President in providing

3 information and scientific evidence with respect to

4 health care quality and consumer protection legisla5 tion;

6 (2) at the request of the appropriate commit7 tees of Congress or the President, develop financial

8 and socioeconomic impact statements for health care

9 quality and consumer protection legislation;

10 (3) develop, using the process recommended by

11 the National Academy of Sciences (Institute of Med12 icine) and the studies carried out under section 109,

13 update, and disseminate population-based bench14 marks and indicators of health care quality;

15 (4) in accordance with section 107, provide the

16 appropriate committees of Congress and the Presi17 dent with an annual report on the State of the Na18 tion’s health care quality or related topics;

19 (5) in accordance with section 108, develop rec20 ommendations for measuring and reporting quality

21 indicators for use in the fee-for-service market;

22 (6) develop, in consultation with the Agency for

23 Health Care Policy and Research and appropriate

24 experts, the data sampling methods to be used in

25 data reporting for monitoring quality indicators and
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1 health outcomes measures as required under section

2 915(c) of the Public Health Service Act (as added

3 by this Act); and

4 (7) carry out such other activities as the Coun5 cil determines appropriate to carry out its duties

6 under this Act.

7 SEC. 106. NATIONAL BENCHMARKS OF QUALITY.

8 (a) DEVELOPMENT.—

9 (1) IN GENERAL.—The Council shall develop

10 population-based benchmarks of health care quality.

11 (2) REVISIONS AND DISSEMINATION.—The pop12 ulation-based benchmarks developed under para13 graph (1) shall be revised, updated and disseminated

14 biennially.

15 (3) PROCESS FOR DEVELOPMENT.—The devel16 opment of the population-based benchmarks under

17 paragraph (1) shall follow the process recommended

18 by the National Academy of Sciences (Institute of

19 Medicine) under section 109, be consistent with ad20 vice and testimony received under subsection (b).

21 (b) EXPERTS.—

22 (1) CONTRACTS.—The Council may enter into a

23 contract with such experts as the Council determines

24 are necessary to carry out its duties under this Act.
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1 (2) EXPERTS.—Consistent with sections 103

2 and 104, the Council shall have the authority to con3 vene expert panels, conduct hearings, and contract

4 for services to obtain information as necessary to

5 carry out its duties under this Act.

6 (c) MODEL STANDARD FORMAT.—The Council, in

7 conjunction with the Agency for Health Care Policy and

8 Research, shall develop model standard formats for pro9 viding health plan information to consumers that may be

10 used by employers or health insurance issuers. In develop11 ing such model formats, the Council shall take into consid12 eration the recommendations of the National Academy of

13 Sciences (Institute of Medicine) following the study au14 thorized under paragraph (4) of section 109(a).

15 (d) QUALITY INDICATORS AND OUTCOMES MEAS16 URES.—

17 (1) IN GENERAL.—The Council shall rec18 ommend to the Secretary of Health and Human

19 Services and the Secretary of Labor, a set of quality

20 indicators (including health services delivery and

21 processes) and health outcomes measures to be used

22 for the reporting of information under this Act (or

23 an amendment made by this Act) by health care pro24 viders and health plans. Such measures shall take

25 into consideration the different populations served
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1 (such as children and the disabled) and where ap2 propriate shall be consistent with requirements ap3 plicable to Medicare+Choice plans under title XVIII

4 of the Social Security Act (42 U.S.C. 1395 et seq.).

5 (2) DIFFERENT INDICATORS AND OUTCOMES

6 MEASURES.—The Secretary of Health and Human

7 Services and the Secretary of Labor may adopt qual8 ity indicators or health outcomes measures that are

9 in a different form than the indicators or outcomes

10 measures recommended by the Council under para11 graph (1) if—

12 (A) the Secretary of Health and Human

13 Services or the Secretary of Labor finds that

14 different indicators or outcomes measures will

15 substantially reduce administrative costs to

16 health care providers and health plans as com17 pared to the alternatives, or that such indica18 tors or measures are demonstrated or proven to

19 be more appropriate for the populations served;

20 and

21 (B) the indicators or outcomes measures

22 are adopted in accordance with the rulemaking

23 procedures of subchapter III of chapter 5 of

24 title 5, United States Code.
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1 SEC. 107. NATIONAL REPORT CARDS.

2 (a) REPORT ON NATIONAL GOALS.—Not later than

3 18 months after the date of enactment of this Act, and

4 every 2 years thereafter, the Council shall prepare and

5 submit to the appropriate committees of Congress and the

6 President a report that—

7 (1) establishes national goals for the improve8 ment of the quality of health care; and

9 (2) contains the recommendations of the Coun10 cil for achieving the national goals.

11 (b) REPORT ON HEALTH RELATED TOPICS.—Not

12 later than 30 months after the date of enactment of this

13 Act and every 2 years thereafter, the Council shall prepare

14 and submit to the Congress and the President a report

15 that addresses at least 1 of the following (or a related mat16 ter):

17 (1) The availability, applicability and appro18 priateness of information to consumers regarding

19 the quality of their health care.

20 (2) The state of information systems and data

21 collecting capabilities for measuring and reporting

22 on quality indicators.

23 (3) The impact of quality measurement on ac24 cess to and the cost of medical care.

25 (4) Barriers to continuous quality improvement

26 in medical care.
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1 (5) The state of health care quality measure2 ment research and development.

3 SEC. 108. EVALUATING PROVIDER QUALITY IN FEE-FOR4 SERVICE.

5 (a) DEVELOPMENT.—The Council shall develop rec6 ommendations for measuring and reporting provider

7 health care quality indicators in the fee-for-service market.

8 (b) REPORT.—Not later than 24 months after the

9 date of enactment of this Act, the Council shall prepare

10 and submit to the Congress and the President a report

11 concerning the strategy developed under this section.

12 SEC. 109. STUDIES.

13 (a) NATIONAL ACADEMY OF SCIENCE.—The Sec14 retary of Health and Human Services shall enter into a

15 contract with the Institute of Medicine of the National

16 Academy of Sciences to conduct studies to—

17 (1) determine what standards should be used in

18 the development of population-based benchmarks

19 against which health care quality can be compared

20 and measured;

21 (2) determine the optimal process for establish22 ing such population-based benchmarks;

23 (3) validate the process determined most appro24 priate under paragraph (2);
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1 (4) assess the optimal application of population2 based benchmarks and how information concerning

3 health care quality should be presented to users, in4 cluding consumers, providers, and purchasers;

5 (5) analyze the next steps necessary for a na6 tional continuous health care quality improvement

7 process;

8 (6) develop recommendations for linking pay9 ment for health services to health outcomes meas10 ures in order to recognize and reimburse health

11 plans and health care providers that provide quality

12 health care, particularly with respect to individuals

13 with special needs or chronic health problems; and

14 (7) consider the relationship between the need

15 for public information to help consumers make in16 formed health care choices and the processes nec17 essary to create an environment that will promote

18 the use of continuous quality improvement tech19 niques.

20 (b) REPORT.—During the period beginning 24

21 months after the date of enactment of this Act, but not

22 later than 36 months after such date of enactment, the

23 Institute of Medicine shall prepare and submit to the Con24 gress and the President a report concerning each study

25 conducted under subsection (a).
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1 (c) REVIEW BY GAO.—The General Accounting Of2 fice shall conduct a periodic review of the conduct of the

3 Council and report its findings to the appropriate commit4 tees of Congress and the President.

5 SEC. 110. AUTHORIZATION OF APPROPRIATIONS.

6 (a) IN GENERAL.—There are authorized to be appro7 priated to the Council such sums as may be necessary to

8 carry out this title.

9 (b) AVAILABILITY.—Any amounts appropriated

10 under subsection (a) shall remain available, without fiscal

11 year limitation, until expended.

12 TITLE II—QUALITY

13 IMPROVEMENT

14 SEC. 201. INVESTMENT IN QUALITY MEASUREMENT.

15 Part B of title IX of the Public Health Service Act

16 (42 U.S.C. 299b et seq.) is amended by adding at the end

17 the following:

18 ‘‘SEC. 915. NATIONAL HEALTH CARE QUALITY INFORMA19 TION.

20 ‘‘(a) PURPOSE.—It is the purpose of this section to

21 expand the duties and responsibilities of the Agency to in22 clude the collection, analysis, and dissemination of health

23 care quality information.

24 ‘‘(b) DUTIES.—In carrying out this section, the

25 Agency shall—
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1 ‘‘(1) provide administrative and scientific sup2 port to the Health Quality Council established under

3 section 101 of the Health Care Quality, Education,

4 Security and Trust Act;

5 ‘‘(2) develop risk and case mix adjustment

6 methodology for use in comparing health outcomes

7 data;

8 ‘‘(3) compile and publicly disseminate aggregate

9 data regarding health care quality indicators and

10 outcomes;

11 ‘‘(4) develop a model standard format that may

12 be used by health insurance issuers in reporting the

13 information required under part C of title XXVII;

14 ‘‘(5) provide assistance in the development of

15 improved information systems, including computer16 ized formats that may be used by health plans in

17 providing the information required under title

18 XXVII;

19 ‘‘(6) collect, maintain and publicly distribute

20 health care quality population-based benchmarks es21 tablished by the Health Quality Council;

22 ‘‘(7) coordinate its activities with respect to

23 health care quality with health plan accrediting bod24 ies, the National Committee on Vital and Health
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1 Statistics, the National Center for Health Statistics,

2 and State and local governments.

3 ‘‘(8) develop survey tools to measure participant

4 and beneficiary satisfaction as required under sec5 tion 101(j)(4) of the Employee Retirement Income

6 Security Act of 1974.

7 ‘‘(c) SUBMISSION OF DATA.—

8 ‘‘(1) IN GENERAL.—Health insurance issuers,

9 group health plans, and health insurance issuers of

10 group health plans shall submit aggregate data,

11 without patient identifiers, obtained in the process of

12 reporting quality indicators and health outcomes

13 measures to the Agency for the purpose of the

14 Health Quality Council’s report as required in sec15 tion 107(a) of the Health Care Quality, Education,

16 Security and Trust Act.

17 ‘‘(2) DATA SAMPLING METHODS.—The Sec18 retary of Health and Human Services and the Sec19 retary of Labor shall develop data sampling methods

20 for the submission of aggregate data under this sec21 tion. Such methods shall be based on the rec22 ommendation of the Health Quality Council estab23 lished under section 101 of the Health Care Quality,

24 Education, Security, and Trust Act.
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1 ‘‘(3) DIFFERENT METHODS.—The Secretary of

2 Health and Human Services and the Secretary of

3 Labor may adopt data sampling methods that are in

4 a different form than the methods recommended by

5 the Council under paragraph (2) if—

6 ‘‘(A) the Secretary of Health and Human

7 Services or the Secretary of Labor finds that

8 different methods will substantially reduce ad9 ministrative costs to health care providers and

10 health plans as compared to the alternatives, or

11 that such methods are demonstrated or proven

12 to be more appropriate; and

13 ‘‘(B) the methods are adopted in accord14 ance with the rulemaking procedures of sub15 chapter III of chapter 5 of title 5, United

16 States Code.’’.

17 TITLE III—HEALTH CARE

18 INFORMATION

19 Subtitle A—Plan Sponsor

20 Responsibilities

21 SEC. 301. EMPLOYEE RETIREMENT INCOME SECURITY ACT

22 OF 1974.

23 (a) IN GENERAL.—Section 101 of the Employee Re24 tirement Income Security Act of 1974 (29 U.S.C. 1021)

25 is amended—
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1 (1) by redesignating the second subsection (h)

2 (relating to cross reference) as subsection (i); and

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

4 ‘‘(j) GROUP HEALTH PLAN DISTRIBUTION OF IN5 FORMATION.—

6 ‘‘(1) SUMMARY PLAN DESCRIPTION.—

7 ‘‘(A) IN GENERAL.—Notwithstanding sec8 tion 102, or any other provision of this Act,

9 with respect to a group health plan (as defined

10 in section 733(a)(1)), the plan administrator of

11 such plan shall furnish to each participant

12 under the group health plan, a copy of the most

13 recent summary plan description for each plan

14 option under which the participant or bene15 ficiary may elect to receive benefits—

16 ‘‘(i) upon the employment of the par17 ticipant or at the time the group health

18 plan first becomes subject to this title,

19 whichever is later; and

20 ‘‘(ii) at the beginning of an open en21 rollment period, if the plan sponsor pro22 vides such a period.

23 Plan sponsors that provide such information in

24 an accessible centralized location and notify
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1 participants of that location shall be deemed to

2 meet the requirements of clause (ii).

3 ‘‘(B) ADDITIONAL REQUIREMENTS.—

4 ‘‘(i) IN GENERAL.—The plan adminis5 trator shall ensure that the most recent

6 summary plan description for a group

7 health plan is provided to participants and

8 beneficiaries—

9 ‘‘(I) at least annually if the plan

10 has been materially modified or

11 amended; and

12 ‘‘(II) upon the request of a par13 ticipant or beneficiary.

14 ‘‘(ii) REQUIRED INFORMATION.—A

15 summary plan description shall inform par16 ticipants and beneficiaries of the availabil17 ity of technical support and information

18 concerning the rights of such participants

19 and beneficiaries under this Act from the

20 Department of Labor, including the phone

21 numbers and location of the Department’s

22 regional offices, and Internet access to in23 formation.

24 ‘‘(2) REQUIRED ANNUAL INFORMATION.—
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1 ‘‘(A) IN GENERAL.—Notwithstanding any

2 other provision of this Act, with respect to a

3 group health plan (as defined in section

4 733(a)(1)), the plan administrator of such plan

5 shall ensure that the information described in

6 subparagraph (B) with respect to material

7 modifications, will be provided not later than 30

8 days after the date on which the change in9 volved becomes effective, to participants and

10 beneficiaries.

11 ‘‘(B) INFORMATION.—The information re12 quired under this subparagraph includes infor13 mation with respect to—

14 ‘‘(i) any material changes in benefit

15 coverage including any new exclusions from

16 coverage or new optional supplemental cov17 erage (including the associated premiums,

18 deductibles, coinsurance, copayments for

19 which the enrollee will be responsible, and

20 any annual or lifetime limits on benefits);

21 ‘‘(ii) any material changes in the

22 health insurance issuer’s service area, in23 cluding any changes in the number, mix,

24 and geographic distribution of participat25 ing providers, including specialists;
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•S 1712 IS

1 ‘‘(iii) any material changes in out-of2 area coverage or out-of-network services (if

3 previously provided) or changes in addi4 tional payments required for these services;

5 ‘‘(iv) any material changes in prior

6 authorization rules; and

7 ‘‘(v) any material changes in plan

8 grievance and appeals procedures.

9 ‘‘(C) PERMISSIBLE PROVISION OF INFOR10 MATION.—A group health plan shall be consid11 ered to have complied with the provisions of

12 subparagraph (B)(ii) if the plan administrator

13 distributes a directory or listing of participating

14 providers to participants and beneficiaries and

15 such directory of list is updated to reflect any

16 material changes in participating providers.

17 ‘‘(D) PARTICIPANT SATISFACTION.—

18 ‘‘(i) IN GENERAL.—With respect to a

19 plan sponsor described in clause (ii) that

20 provides a group health plan, the plan

21 sponsor shall annually provide to partici22 pants and beneficiaries a summary report

23 of participant satisfaction and

24 disenrollment rates (if applicable) regard-
29

•S 1712 IS

1 ing each enrollment option offered to par2 ticipants and beneficiaries.

3 ‘‘(ii) PLAN SPONSOR DESCRIBED.—A

4 plan sponsor described in this clause is a

5 plan sponsor—

6 ‘‘(I) with 100 or more partici7 pants enrolled in a group health plan

8 during a plan year; and

9 ‘‘(II) with a contracting relation10 ship with the health insurance issuer

11 involved for at least 2 years.

12 ‘‘(3) NOTIFICATIONS BY PLAN ADMINIS13 TRATOR.—With respect to a group health plan, a

14 plan administrator shall notify participants and

15 beneficiaries under the plan that the plan sponsor

16 involved—

17 ‘‘(A) has stopped paying plan premiums or

18 has terminated reimbursement for services cov19 ered under the plan not later than 30 days

20 after the date of the first nonpayment by the

21 plan sponsor; or

22 ‘‘(B) in the case of a plan sponsor involved

23 in a sale or merger, has made changes in the

24 group health plan involved not later than the
30

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1 date on which the assets of the plan sponsor

2 are transferred following such sale or merger.

3 ‘‘(4) USE OF CERTAIN INFORMATION.—In order

4 to meet the requirements of paragraph (2)(D), a

5 group health plan sponsor may use satisfaction sur6 vey measurement tools that have been developed and

7 made available by the Agency for Health Care Policy

8 and Research.

9 ‘‘(5) ESTABLISHMENT OF INTERNET SITE.—

10 The Secretary shall provide for the establishment of

11 a site on the Internet to provide technical support

12 and information concerning the rights of partici13 pants and beneficiaries under this Act.

14 ‘‘(6) NO LIMITATION.—Nothing in this sub15 section shall be construed to prohibit a plan sponsor

16 from distributing any additional information that

17 such plan sponsor considers important or necessary

18 in assisting participants and beneficiaries with

19 changes to the group health plan.

20 ‘‘(7) RULE OF CONSTRUCTION.—For purposes

21 of this subsection, a plan administrator, in reliance

22 on records maintained by the administrator, shall be

23 deemed to have met the requirements of this sub24 section if the administrator provides the information

25 requested under this subsection to participants and
31

•S 1712 IS

1 beneficiaries at the address contained in such

2 records with respect to such participants and bene3 ficiaries.’’.

4 Subtitle B—Health Plan Require5 ments And Consumer Protection

6 SEC. 311. AMENDMENT TO PUBLIC HEALTH SERVICE ACT.

7 (a) CONSUMER PROTECTION STANDARDS.—Title

8 XXVII of the Public Health Service Act is amended—

9 (1) by redesignating part C as part D, and

10 (2) by inserting after part B the following:

11 ‘‘PART C—PROTECTION FOR CONSUMERS

12 ‘‘SEC. 2770. EXEMPTION.

13 ‘‘(a) IN GENERAL.—Upon the application of a group

14 health plan or a health insurance issuer, the Secretary

15 may exempt such plan or issuer from compliance with 1

16 or more of the requirements of this part.

17 ‘‘(b) REQUIREMENTS.—The Secretary may grant an

18 exemption under this section if—

19 ‘‘(1) the Secretary—

20 ‘‘(A) publishes a notice of the pendency of

21 such exemption in the Federal Register; and

22 ‘‘(B) provides notice, and an opportunity

23 for comment, of the pendency of such exemp24 tion to interested individuals; and
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•S 1712 IS

1 ‘‘(2) the Secretary determines that the exemp2 tion—

3 ‘‘(A) is administratively feasible;

4 ‘‘(B) is in the interests of the group health

5 plan and the participants and beneficiaries

6 under such plan, or in the interests of the

7 health insurance issuer and the enrollees in8 volved; and

9 ‘‘(C) is protective of the rights of partici10 pants and beneficiaries or enrollees, as the case

11 may be.

12 ‘‘(c) SCOPE OF EXEMPTION.—An exemption provided

13 under this section—

14 ‘‘(1) shall apply only to those requirements

15 identified by the Secretary in approving the exemp16 tion;

17 ‘‘(2) may be conditional; and

18 ‘‘(3) may be provided to a class of plans or

19 issuers.

20 ‘‘(d) PROCEDURES.—The Secretary shall develop

21 procedures to provide exemptions under this section.

22 ‘‘SUBPART 1—CONSUMER INFORMATION

23 ‘‘SEC. 2771. HEALTH PLAN COMPARATIVE INFORMATION.

24 ‘‘(a) REQUIREMENT.—A health insurance issuer in

25 connection with the provision of health insurance coverage,
33

•S 1712 IS

1 shall, not later than 12 months after the date of enact2 ment of this part, provide for the disclosure, in a clear

3 and accurate form to each plan sponsor, with which the

4 issuer has contracted, each enrollee, or upon request to

5 a potential enrollee or plan sponsor, of the information

6 described in subsection (b).

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

8 materials to be distributed under this section shall include

9 for each plan the following:

10 ‘‘(1) A description of the covered items and

11 services under each such plan and the in- and out12 of-network features of each such plan.

13 ‘‘(2) A description of any cost sharing, includ14 ing premiums, deductibles, coinsurance, and copay15 ment amounts, for which the enrollee will be respon16 sible, including any annual or lifetime limits on ben17 efits, for each such plan.

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

19 benefits offered by each such plan and the terms

20 and conditions (including premiums or cost-sharing)

21 for such supplemental coverage.

22 ‘‘(4) A description of any restrictions on pay23 ments for services furnished to an enrollee by a

24 health care professional that is not a participating
34

•S 1712 IS

1 professional and the liability of the enrollee for addi2 tional payments for these services.

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

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

5 coverage.

6 ‘‘(6) A description of the extent to which enroll7 ees may select the primary care provider of their

8 choice, including providers both within the network

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

10 plan permits out-of-network services) as well as pro11 cedures for obtaining specialist referral.

12 ‘‘(7) A summary of data concerning enrollee

13 satisfaction with the plan, including disenrollment

14 rates for the previous 2 plan years (excluding

15 disenrollments due to the death of an enrollee or the

16 enrollee moving outside of the service area of the

17 plan), based on the health plan’s ‘book-of-business’.

18 Health plans may elect to provide specific informa19 tion regarding disenrollment rates.

20 ‘‘(8) A description of the procedures for ad21 vance directives and organ donation decisions.

22 ‘‘(9) A description of the requirements and pro23 cedures to be used to obtain preauthorization for

24 health services (including telephone numbers and
35

•S 1712 IS

1 mailing addresses), including referrals for specialty

2 care.

3 ‘‘(10) A summary of the rules and methods for

4 appealing coverage decisions and filing grievances

5 (including telephone numbers and mailing address6 es), as well as other available remedies.

7 ‘‘(11) A summary of the rules for access to

8 emergency room care, including educational material

9 regarding proper use of emergency services.

10 ‘‘(12) A description of licensure, certification or

11 accreditation status of the health plan and the name

12 and address of the State or Federal regulatory agen13 cy with oversight responsibilities.

14 ‘‘(13) A description of whether or not access is

15 provided to experimental treatments, investigational

16 treatments, or clinical trials and the circumstances

17 under which access to such treatments or trials is

18 made available.

19 ‘‘(14) A description of whether or not access is

20 provided to specialists without referral and the cir21 cumstances under which access to such specialists is

22 provided.

23 ‘‘(15) A description of the quality indicators

24 and health outcomes measures of the plan in accord25 ance with subsection (c).
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•S 1712 IS

1 ‘‘(16) A statement that the following informa2 tion, and instructions on obtaining such information

3 (including telephone numbers and Internet

4 websites), shall be made available upon request:

5 ‘‘(A) Additional information on the quality

6 of care and health outcomes under the plan.

7 ‘‘(B) The names, credentials, addresses,

8 and telephone numbers and the availability

9 (such as whether professionals accept patients),

10 speciality focus, affiliation arrangements, num11 ber and mix of the health care professionals in

12 the network of the plan, and any measures of

13 consumer satisfaction if such satisfaction meas14 ures are available.

15 ‘‘(C) The names and locations of partici16 pating health care facilities, the accreditation

17 status, the for-profit or not-for-profit status of

18 such facilities, and any measures of consumer

19 satisfaction if such satisfaction measures are

20 available.

21 ‘‘(D) A summary description of the meth22 ods used for compensating participating health

23 care professionals (including capitation, finan24 cial incentives or bonuses, fee-for-service, group

25 practice, salary and withholdings), including the
37

•S 1712 IS

1 proportions of participating health care profes2 sionals who are compensated under each type of

3 arrangement under the plan.

4 ‘‘(E) A summary description of the proce5 dures used for utilization review, including the

6 process by which specific determinations are

7 made.

8 ‘‘(F) The list of the specific prescription

9 medications included in the formulary of the

10 plan, if the plan uses a defined formulary.

11 ‘‘(G) A description of the specific exclu12 sions from coverage under the plan.

13 ‘‘(H) A description of the specific prevent14 ative services covered under the plan.

15 ‘‘(I) A description of the availability of

16 translation or interpretation services for non17 English speakers and people with communica18 tion disabilities, including the availability of

19 audio tapes or information in Braille.

20 ‘‘(J) A description of the number of exter21 nal review requests that have been filed with an

22 external review panel designated in accordance

23 with section 2777(e) and the outcome of such

24 requests by an external review panel in the pre25 ceding calendar year.
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•S 1712 IS

1 ‘‘(c) DETERMINATION OF INDICATORS AND MEAS2 URES.—

3 ‘‘(1) IN GENERAL.—The Secretary of Health

4 and Human Services, in consultation with the Sec5 retary of Labor, shall develop quality indicators and

6 health outcomes measures for use by health insur7 ance issuers in providing the information required

8 under section (b), taking into consideration the rec9 ommendations of the Health Quality Council. Such

10 quality indicators and health outcomes measures

11 shall, while taking into consideration the different

12 populations served (such as children and individuals

13 with disabilities), be consistent where appropriate

14 with requirements applicable to Medicare+Choice

15 health plans under title XVIII of the Social Security

16 Act (42 U.S.C. 1395 et seq.).

17 ‘‘(2) DIFFERENT INDICATORS AND OUTCOMES

18 MEASURES.—The Secretary of Health and Human

19 Services and the Secretary of Labor may adopt qual20 ity indicators or health outcomes measures that are

21 in a different form than the indicators or outcomes

22 measures recommended by the Council under para23 graph (1) if—

24 ‘‘(A) the Secretary of Health and Human

25 Services or the Secretary of Labor finds that
39

•S 1712 IS

1 different indicators or outcomes measures will

2 substantially reduce administrative costs to

3 health care providers and health plans as com4 pared to the alternatives, or that such indica5 tors or measures are demonstrated or proven to

6 be more appropriate for the populations served;

7 and

8 ‘‘(B) the indicators or outcomes measures

9 are adopted in accordance with the rulemaking

10 procedures of subchapter III of chapter 5 of

11 title 5, United States Code.

12 ‘‘(d) MANNER OF DISTRIBUTION.—

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

14 in this section shall—

15 ‘‘(A) be distributed in an accessible format

16 that is understandable to an average plan en17 rollee; and

18 ‘‘(B) with respect to populations of individ19 uals whose primary language is other than

20 English, be provided in the primary language of

21 such population if that population comprises

22 not less than 20 percent of the total population

23 of the geographic area served by the health plan

24 involved.
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1 ‘‘(2) RULE OF CONSTRUCTION.—For purposes

2 of this section, a health insurance issuer, in reliance

3 on records maintained by the issuer, in reliance on

4 records maintained by the issuer, shall be deemed to

5 have met the requirements of this section if the

6 issuer provides the information requested under this

7 section to enrollees at the address contained in such

8 records with respect to such enrollees.

9 ‘‘(e) RULE OF CONSTRUCTION.—Nothing in this sec10 tion may be construed to prohibit a health insurance

11 issuer from distributing any other information determined

12 to be important or necessary in assisting enrollees or upon

13 request potential enrollees in the selection of a health plan.

14 ‘‘SUBPART 2—CONSUMER PROTECTION AND PLAN

15 STANDARDS

16 ‘‘SEC. 2775. EMERGENCY SERVICES.

17 ‘‘(a) ACCESS TO SERVICES.—A group health plan,

18 health insurance issuer offering group health insurance,

19 or a health insurance issuer who provides coverage for

20 emergency service shall ensure that emergency services are

21 available and accessible 24 hours a day and 7 days a week.

22 ‘‘(b) PAYMENT FOR SERVICES.—A group health plan,

23 health insurance issuer offering group health insurance,

24 or a health insurance issuer described in subsection (a),
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•S 1712 IS

1 shall cover emergency services furnished under the plan

2 or coverage—

3 ‘‘(1) in a manner so that, if such services are

4 provided to an enrollee by a non-participating health

5 care provider—

6 ‘‘(A) the enrollee shall not be liable for

7 amounts paid for such services in excess of the

8 amount that would have been paid if the serv9 ices were provided by a participating health

10 care provider; and

11 ‘‘(B) the plan or issuer shall pay an

12 amount for such services that is not less than

13 the amount that would be paid to a participat14 ing health care provider for the same services;

15 and

16 ‘‘(2) without regard to any other term or condi17 tion of such plan or coverage (other than exclusion

18 or coordination of benefits, or an affiliation or wait19 ing period permitted under section 2701, and other

20 than applicable cost-sharing requirements).

21 ‘‘(c) PRIOR AUTHORIZATION.—A group health plan,

22 health insurance issuer offering group health insurance,

23 or a health insurance issuer described in subsection (a)

24 shall provide coverage for emergency services without re-
42

•S 1712 IS

1 gard to prior authorization or the emergency care provid2 er’s contractual relationship with the plan involved.

3 ‘‘(d) GUIDELINES RESPECTING COORDINATION OF

4 POST-STABILIZATION CARE.—

5 ‘‘(1) IN GENERAL.—A group health plan, a

6 health insurance issuer offering group health insur7 ance, or a health insurance issuer shall comply with

8 guidelines established by the Secretary of Health

9 and Human Services (with respect to health insur10 ance issuers) and the Secretary of Labor (with re11 spect to group health plans) relating to promoting

12 efficient and timely coordination of appropriate

13 maintenance and post-stabilization care of an en14 rollee after the enrollee has been determined to be

15 stable (as defined for purposes of section 1867 of

16 the Social Security Act).

17 ‘‘(2) GUIDELINES.—The guidelines established

18 by the Secretary of Health and Human Services and

19 the Secretary of Labor under paragraph (1) shall be

20 the guidelines adopted with respect to appropriate

21 maintenance and post-stabilization care for

22 Medicare+Choice plans under part C of title XVIII

23 of the Social Security Act.

24 ‘‘(e) DEFINITIONS.—In this section:
43

•S 1712 IS

1 ‘‘(1) EMERGENCY SERVICES.—The term ‘emer2 gency services’ means, with respect to an enrollee in

3 a health plan, covered inpatient and outpatient serv4 ices that are needed to evaluate or stabilize an emer5 gency medical condition (as defined in paragraph

6 (2)).

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

8 term ‘emergency medical condition’ means a medical

9 condition manifesting itself by acute symptoms of

10 sufficient severity (including severe pain) such that

11 a prudent layperson, who possesses an average

12 knowledge of health and medicine, could reasonably

13 expect the absence of immediate medical attention to

14 result in—

15 ‘‘(i) placing the health of the individ16 ual (or, with respect to a pregnant woman,

17 the health of the woman or her unborn

18 child) in serious jeopardy;

19 ‘‘(ii) serious impairment to bodily

20 functions; or

21 ‘‘(iii) serious dysfunction of any bodily

22 organ or part.

23 ‘‘(2) POST-STABILIZATION CARE.—The term

24 ‘post-stabilization care’ means, with respect to an in25 dividual who is determined to be stable under section
44

•S 1712 IS

1 1867 of the Social Security Act pursuant to a medi2 cal screening examination or who is stabilized after

3 provision of emergency services, medically necessary

4 items and services (other than emergency services

5 and other than maintenance care) that are required

6 by the individual.

7 ‘‘SEC. 2776. ADVANCE DIRECTIVES AND ORGAN DONATION.

8 ‘‘A group health plan or health insurance issuer shall

9 maintain written policies and procedures with respect to

10 advance directives (as such term is defined in section

11 1866(f)(3) of the Social Security Act (42 U.S.C.

12 1395cc(f)(3))) and organ donation decisions on the part

13 of an enrollee. Nothing in the preceding sentence shall be

14 construed to require the provision of information regard15 ing assisted suicide, euthanasia, or mercy killing.

16 ‘‘SEC. 2777. COVERAGE DETERMINATION, GRIEVANCES AND

17 APPEALS.

18 ‘‘(a) COVERAGE DETERMINATIONS.—

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

20 health insurance issuer shall ensure that procedures

21 are in place for—

22 ‘‘(A) making determinations regarding

23 whether an enrollee is eligible to receive a pay24 ment or coverage for health service under the

25 plan or coverage involved and the amount (if
45

•S 1712 IS

1 any) that the enrollee is required to pay with

2 respect to such service;

3 ‘‘(B) notifying covered enrollees (or indi4 viduals acting on behalf of such enrollees) and

5 health care professionals providing the service

6 involved regarding determinations made by the

7 plan or issuer and any additional payments that

8 the enrollee may be required to make with re9 spect to such service; and

10 ‘‘(C) responding to either written or oral

11 requests for coverage determinations from an

12 enrollee (or an individual acting on behalf of an

13 enrollee) or a treating health care professional.

14 ‘‘(2) ROUTINE DETERMINATION.—

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

16 or a health insurance issuer shall ensure that

17 prior authorization determinations concerning

18 the provision of non-emergency items or serv19 ices are made within 15 days of the date on

20 which the plan or issuer receives a request for

21 such a determination.

22 ‘‘(B) INCOMPLETE INFORMATION.—If a

23 determination cannot be made under subpara24 graph (A) within the 15 day period referred to

25 in such subparagraph, because of the incom-
46

•S 1712 IS

1 plete nature of the medical or coverage informa2 tion involved, the plan or issuer shall provide a

3 written notification of such fact to the enrollee

4 (or individual acting on behalf of the enrollee)

5 and the treating health care professional.

6 ‘‘(C) SUBMISSION OF ADDITIONAL INFOR7 MATION.—Upon receipt of a notification under

8 subparagraph (B), an enrollee (or individual

9 acting on behalf of an enrollee) or the treating

10 health care professional shall submit the addi11 tional information required within the 30-day

12 period beginning on the date on which such no13 tification is received.

14 ‘‘(D) DETERMINATION.—A group health

15 plan or health insurance issuer shall make a de16 termination under this paragraph within 2

17 working days of the date on which complete in18 formation is obtained.

19 ‘‘(3) EXPEDITED DETERMINATION.—

20 ‘‘(A) IN GENERAL.—A prior authorization

21 determination under this subsection shall be

22 made within 72 hours after a request is re23 ceived by the plan or issuer if the request indi24 cates that the treating health care professional

25 (regardless of whether the professional is affili-
47

•S 1712 IS

1 ated with the plan or issuer involved) certifies

2 that a determination under the procedures de3 scribed in paragraph (2) could seriously jeop4 ardize the life or health of the enrollee or the

5 ability of the enrollee to regain maximum func6 tion.

7 ‘‘(B) INFORMATION.—In an expedited re8 view under this paragraph, all necessary infor9 mation shall be transmitted between the plan or

10 issuer and the enrollee (or individual acting on

11 behalf of the enrollee) and the treating health

12 care professional by the most expeditious meth13 od available.

14 ‘‘(C) NOTICE.—Notice of a determination

15 under an expedited review shall be provided to

16 the enrollee (or individual acting on behalf of

17 the enrollee) and the treating health care pro18 fessional within the 72-hour period referred to

19 in subparagraph (A) by the most expedient

20 method available. Written confirmation of such

21 determination shall be provided to the enrollee

22 (or individual) or treating health care profes23 sional within 2 working days of the initial no24 tice.

25 ‘‘(4) NOTICE OF DETERMINATIONS.—
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1 ‘‘(A) APPROVAL.—With respect to the rou2 tine determination of a plan or issuer under

3 paragraph (2) to certify an admission, proce4 dure or service, with respect to an enrollee, the

5 plan or issuer shall provide notice of such deter6 mination to the treating health care profes7 sional involved within 24 hours of making such

8 determination. A written or electronic confirma9 tion of such determination shall be made to

10 such professional and enrollee (or individual

11 acting on behalf of the enrollee) within 2 work12 ing days of the date on which the initial notice

13 was provided.

14 ‘‘(B) ADVERSE DETERMINATIONS.—With

15 respect to a routine adverse determination by a

16 plan or issuer under paragraph (2), the plan or

17 issuer shall provide notice of such determination

18 to the treating health care professional within

19 24 hours of making the determination. A writ20 ten or electronic confirmation of such deter21 mination shall be made to such professional,

22 and a written notice of such determination shall

23 be made to the enrollee involved (or individual

24 acting on behalf of an individual), within 1
49

•S 1712 IS

1 working day of the date on which the initial no2 tice was provided.

3 ‘‘(C) CONCURRENT REVIEWS.—With re4 spect to the determination of a plan or issuer

5 under paragraph (1) to certify or deny an ex6 tended stay or additional services, the plan or

7 issuer shall provide notice of such determination

8 to the health care provider rendering the service

9 involved within 1 working day of making such

10 determination. A written or electronic confirma11 tion of such determination shall be made to

12 such professional and to the enrollee involved

13 (or individual acting on behalf of the enrollee)

14 within 1 working day of the date on which the

15 initial notice was provided.

16 ‘‘(D) RETROSPECTIVE REVIEWS.—With re17 spect to the retrospective review by a plan or

18 issuer of a determination made under para19 graph (1), a determination shall be made within

20 30 working days of the date on which the plan

21 or issuer receives all necessary information. The

22 plan or issuer shall provide written notice of an

23 approval or disapproval of a determination

24 under this subparagraph to the enrollee (or in25 dividual acting on behalf of the enrollee) and
50

•S 1712 IS

1 health care provider involved within 5 working

2 days of the date on which such determination is

3 made.

4 ‘‘(E) REQUIREMENT OF NOTICE.—A writ5 ten or electronic notice of an adverse deter6 mination under subparagraph (B), (C) or (D),

7 or of an expedited adverse determination under

8 paragraph (3), shall be provided to the enrollee

9 (or individual acting on behalf of the enrollee)

10 and health care provider (if any) involved and

11 shall include—

12 ‘‘(i) the reasons for the determination

13 (including the clinical rationale) written in

14 a manner to be understandable (to the ex15 tent possible) to the average enrollee;

16 ‘‘(ii) the procedures for obtaining ad17 ditional information concerning the deter18 mination; and

19 ‘‘(iii) notification of the right to ap20 peal the determination and instructions on

21 how to initiate an appeal in accordance

22 with subsection (d)(2).

23 ‘‘(5) DEFINITION.—As used in this section, the

24 term ‘adverse determination’ with respect to a group

25 health plan or health insurance coverage means a
51

•S 1712 IS

1 determination to deny, reduce or terminate services,

2 deny payment for services, or any decision to deny

3 coverage based on a lack of medical necessity, under

4 the terms and conditions of such plan or coverage.

5 ‘‘(b) NOTICE FOR OTHER DETERMINATIONS.—A

6 group health plan or a health insurance issuer shall pro7 vide written notice to an enrollee (or individual acting on

8 behalf of an enrollee) and a health care professional in9 volved of a determination by the plan or issuer to deny,

10 reduce or terminate services or deny payment for services.

11 Such notification shall include a brief explanation (written

12 in a manner to be understood by an average enrollee) of

13 the reasons for the determination, procedures for obtain14 ing additional information, and procedures for appealing

15 the determination.

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

17 insurance issuer shall have written procedures for address18 ing grievances between the plan and enrollees, including

19 grievances relating to waiting periods, operating hours,

20 the demeanor of personnel, and the adequacy of facilities.

21 Determinations under such procedures shall be non22 appealable.

23 ‘‘(d) INTERNAL APPEAL OF COVERAGE DETERMINA24 TIONS.—
52

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1 ‘‘(1) IN GENERAL.—An enrollee (or an individ2 ual acting on behalf of an enrollee) and the treating

3 health care professional with the consent of the en4 rollee (or an individual acting on behalf of the en5 rollee), may appeal (orally or in writing) any adverse

6 determination under subsection (a) or (b) under the

7 procedures described in this subsection.

8 ‘‘(2) APPEAL.—A group health plan and a

9 health insurance issuer shall establish and maintain

10 an internal appeal process under which any enrollee

11 (or an individual acting on behalf of an enrollee) or

12 the treating health care professional with the con13 sent of the enrollee (or an individual acting on be14 half of the enrollee), who is dissatisfied with any ad15 verse determination has the opportunity to discuss

16 and appeal (either orally or in writing) that decision.

17 ‘‘(3) RECORDS.—A group health plan and a

18 health insurance issuer shall maintain written

19 records with respect to any appeal under this sub20 section for purposes of internal quality assurance

21 and improvement.

22 ‘‘(4) WRITTEN REQUEST.—With respect to an

23 oral request under paragraph (1), a group health

24 plan or a health insurance issuer may require that

25 the requesting individual provide written evidence of
53

•S 1712 IS

1 such request for record keeping purposes. A request

2 for written evidence under the preceding sentence

3 shall not be used by a group health plan or health

4 insurance issuer to delay the initiation of the appeals

5 process under this subsection pending the receipt of

6 such evidence.

7 ‘‘(5) ROUTINE DETERMINATIONS.—Except as

8 provided for in paragraph (6), a group health plan

9 or a health insurance issuer shall provide for the

10 consideration of an appeal of an adverse determina11 tion under this subsection not later than 30 days

12 after the date on which a request for such appeal is

13 received.

14 ‘‘(6) EXPEDITED DETERMINATION.—A deter15 mination with respect to an appeal under this sub16 section shall, upon the written or oral request of an

17 enrollee (or an individual acting on behalf of the en18 rollee) or the treating health care professional, be

19 made within 72 hours after the request for such ap20 peal is received by the plan or issuer if the request

21 indicates that the treating health care professional

22 (regardless of whether the professional is affiliated

23 with the plan or issuer involved) certifies that a de24 termination under the procedures described in para25 graph (5) could seriously jeopardize the life or
54

•S 1712 IS

1 health of the enrollee or the ability of the enrollee

2 to regain maximum function.

3 ‘‘(7) CONDUCT OF REVIEW.—A review of a de4 termination under this subsection shall be conducted

5 by health care professionals who are knowledgeable

6 about the enrollee’s condition and the treatment or

7 service involved, including physicians and other

8 trained health care professionals. Such review shall

9 not be conducted by an individual who was involved

10 in the initial decision.

11 ‘‘(8) LACK OF MEDICAL NECESSITY.—An ap12 peal under this subsection relating to a determina13 tion to deny coverage based on a lack of medical ne14 cessity or appropriateness shall be made only by a

15 physician with appropriate expertise in the field of

16 medicine involved who is not involved in the initial

17 determination.

18 ‘‘(9) NOTICE.—

19 ‘‘(A) IN GENERAL.—Written notice—

20 ‘‘(i) of a determination made under

21 paragraph (6) shall be provided to the en22 rollee (or individual acting on behalf of the

23 enrollee) and the treating health care pro24 fessional within the 72-hour period re-
55

•S 1712 IS

1 ferred to in such paragraph in the most ex2 peditious manner possible; and

3 ‘‘(ii) of a determination under para4 graph (5), shall be provided in writing to

5 the enrollee (or individual acting on behalf

6 of the enrollee) and the treating health

7 care professional within 2 working days

8 after the completion of the review referred

9 to in such paragraph.

10 ‘‘(B) ADVERSE DETERMINATIONS.—With

11 respect to an adverse determination made under

12 paragraph (5) or (6), the notice described in

13 subparagraph (A) shall include written informa14 tion on how the determination may be appealed

15 to an external entity under subsection (e).

16 ‘‘(e) EXTERNAL REVIEW.—

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

18 health insurance issuer shall have written procedures

19 to permit an enrollee (or an individual acting on be20 half of an enrollee) or the treating health care pro21 fessional with the consent of the enrollee (or individ22 ual), the right to an external appeal of an adverse

23 determination if such determination involves treat24 ments or services covered by the terms and condition

25 of the plan that cost at least $1,000.
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•S 1712 IS

1 ‘‘(2) ELIGIBILITY FOR DESIGNATION AS EXTER2 NAL REVIEW PANEL.—

3 ‘‘(A) DESIGNATION.—The appropriate

4 State agent shall designate individuals who are

5 eligible to serve on, or entities eligible to act as,

6 an external review panel to review external ap7 peals brought under this subsection.

8 ‘‘(B) REQUIREMENTS.—In designating in9 dividuals or entities under subparagraph (A),

10 the State agent shall ensure that the individual

11 or entity is licensed or certified to conduct ex12 ternal reviews by—

13 ‘‘(i) the State agent, in accordance

14 with licensing and certification procedures

15 to be developed by the State in consulta16 tion with the National Association of In17 surance Commissioners; or

18 ‘‘(ii) in the case of a State that—

19 ‘‘(I) has not established such li20 censing and certification procedures

21 within 24 months of the date of enact22 ment of this subpart, the State in ac23 cordance with procedures to be devel24 oped by the Secretary; or
57

•S 1712 IS

1 ‘‘(II) refuses to designate such

2 panels, the Secretary.

3 ‘‘(C) LIABILITY.—An individual designated

4 to an external review panel under this sub5 section shall not be held liable for any decision

6 made by such panel.

7 ‘‘(3) INITIATION OF THE EXTERNAL REVIEW

8 PROCESS.—

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

10 (or individual acting on behalf of an enrollee) or

11 the treating health care professional with the

12 consent of the enrollee (or individual) who de13 sires to have an external review conducted

14 under this subsection shall file a written request

15 for such a review with the plan or issuer in16 volved and the appropriate State agent not later

17 than 30 days after the receipt of a final denial

18 of a claim under subsection (d). Any such re19 quest shall include the consent of the enrollee

20 (or individual) for the release of confidential

21 medical information regarding the enrollee (or

22 individual) if such information is necessary for

23 the proper conduct of the external review.

24 ‘‘(B) INFORMATION AND NOTICE.—Not

25 later than 5 working days after the receipt of
58

•S 1712 IS

1 a request under subparagraph (A), the plan or

2 issuer involved shall—

3 ‘‘(i) forward all necessary information

4 (including medical records, any relevant re5 view criteria, the clinical rationale for the

6 denial, and evidence of the enrollee’s cov7 erage) to the appropriate State agent (or

8 the designee of such agent); and

9 ‘‘(ii) send a written notification to the

10 enrollee (or individual acting on behalf of

11 the enrollee), the treating health care pro12 fessional, and the plan administrator, indi13 cating that an external review has been ini14 tiated.

15 ‘‘(C) APPOINTMENT OF PANEL.—Not later

16 than 30 days after the information and notifica17 tion are provided under subsection (b)—

18 ‘‘(i) the State agent, in the case of a

19 plan or issuer involved that is fully in20 sured, shall appoint an external review

21 panel from among the individuals and enti22 ties eligible under paragraph (2);

23 ‘‘(ii) the plan fiduciary, in the case of

24 a plan or issuer involved that is self-in25 sured, shall appoint an external review
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•S 1712 IS

1 panel from among the individuals and enti2 ties eligible under paragraph (2); or

3 ‘‘(iii) the State agent, in the case of

4 a group health plan where the plan spon5 sor directly provided health care under

6 such plan.

7 ‘‘(D) REQUIREMENTS.—A review panel ap8 pointed under subparagraph (C) shall—

9 ‘‘(i) consist of at least 3 physicians or

10 other health care professionals who are ex11 perts in the treatment of the enrollee’s

12 condition and knowledgeable about the rec13 ommended treatment; or

14 ‘‘(ii) be an impartial review entity in15 cluding a medical peer review organization

16 or an independent utilization review com17 pany.

18 ‘‘(E) APPROVAL OF ENROLLEE.—Not later

19 than 15 days after the date on which an exter20 nal review panel is designated under this para21 graph, the enrollee involved shall, in writing—

22 ‘‘(i) approve such panel; or

23 ‘‘(ii) object to such panel and select

24 alternative individuals or entities who are
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•S 1712 IS

1 eligible under paragraph (2) to serve on

2 such panel.

3 Individuals or entities approved or selected

4 under this subparagraph shall serve as the ex5 ternal review panel under this subsection with

6 respect to the enrollee involved.

7 ‘‘(F) CONFLICT OF INTEREST.—An exter8 nal review panel designated under this para9 graph shall not have any material, professional,

10 familial, or financial affiliation with the health

11 plan, health insurance issuer or the enrollee in12 volved, or any officer, director, or management

13 employee of the plan, issuer, physician, medical

14 group, or association recommending the treat15 ment, the institution where the treatment would

16 take place, or the manufacturer of any drug,

17 device, procedure, or other therapy proposed for

18 the enrollee whose treatment is under review.

19 ‘‘(4) STANDARD OF REVIEW.—An external re20 view panel designated under paragraph (3) shall—

21 ‘‘(A) complete a review of an adverse de22 termination not later than 30 days after the

23 later of—

24 ‘‘(i) the date on which such panel is

25 approved under paragraph (4)(E); or
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•S 1712 IS

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

2 necessary to completing such review is re3 ceived;

4 ‘‘(B) take into consideration the benefits

5 and coverage provided under the terms and con6 ditions of the plan involved;

7 ‘‘(C) follow a standard of review that pro8 motes evidence-based decision making; and

9 ‘‘(D) submit a report on the final deter10 minations of the panel to—

11 ‘‘(i) the plan or issuer involved;

12 ‘‘(ii) the enrollee involved (or individ13 ual acting on behalf of the enrollee);

14 ‘‘(iii) the health care professional in15 volved; and

16 ‘‘(iv) the State agent responsible for

17 designating review panels under paragraph

18 (2).

19 ‘‘(5) FILING FEE.—A State may impose a filing

20 fee to be applied to an enrollee initiating an external

21 review under this subsection. If a State elects to im22 pose such a filing fee, the State must include a pro23 cedure to provide for a fee reduction if the enrollee

24 demonstrates financial hardship through status or
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•S 1712 IS

1 evidence of participation in a State or Federal cash

2 assistance program.

3 ‘‘(6) PAYMENT FOR EXTERNAL REVIEW.—A

4 health plan, or health insurance issuer shall be fi5 nancially responsible for any reasonable costs associ6 ated with the conduct of an external review under

7 this subsection.

8 ‘‘(7) ANNUAL REPORTING.—The appropriate

9 State agent shall conduct annual reviews of the

10 number of external reviews requested under this sub11 section and the outcomes of such reviews. A report

12 concerning such annual reviews shall be made public

13 and forwarded to the Secretary of Health and

14 Human Services (with respect to health insurance

15 issuers) and the Secretary of Labor (with respect to

16 reports on group health plans). Such reports shall

17 breakdown the results by relevance to group health

18 plans and health insurance issuers.

19 ‘‘(8) AUDITS.—Not later than 2 years after the

20 date of enactment of this subpart, the General Ac21 counting Office shall conduct a review of all licensed,

22 certified, or appointed review panels under para23 graph (3). Such review shall include an assessment

24 of the process involved during an external review
63

•S 1712 IS

1 and the basis of decisionmaking by the board or

2 panel.

3 ‘‘(9) RULE OF CONSTRUCTION.—The deter4 mination of an external review panel shall be binding

5 on the plan or issuer involved, except that nothing

6 in this subsection shall be construed to preclude the

7 right of a group health plan, health insurance issuer,

8 or an enrollee from commencing a civil action based

9 on the plan or coverage involved.

10 ‘‘(f) PRIOR AUTHORIZATION DETERMINATION.—For

11 purposes of this section, the term ‘prior authorization de12 termination’ means, with respect to items and services for

13 which coverage may be provided under a health plan, a

14 determination (before the provision of the items and serv15 ices and as a condition of coverage of the items and serv16 ices under the coverage) of whether or not such items and

17 services will be covered under the coverage.

18 ‘‘SEC. 2778. CONFIDENTIALITY AND ACCURACY OF ENROLL19 EES RECORDS.

20 ‘‘A group health plan or a health insurance issuer

21 shall establish procedures with respect to medical records

22 or other health information maintained regarding enroll23 ees to safeguard the privacy of any individually identifiable

24 enrollee information.
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•S 1712 IS

1 ‘‘SUBPART 3—HEALTH CARE PROFESSIONAL

2 PROTECTIONS

3 ‘‘SEC. 2781. HEALTH CARE PROFESSIONAL COMMUNICA4 TIONS.

5 ‘‘(a) PROVISION OF INFORMATION TO PROFES6 SIONALS.—

7 ‘‘(1) HEALTH INSURANCE ISSUERS.—A health

8 insurance issuer shall establish procedures concern9 ing the participation of health care professionals

10 under coverage provided by the issuer under which

11 such professionals will be provided with written no12 tice of—

13 ‘‘(A) the rules of the issuer concerning

14 participation;

15 ‘‘(B) any participation decisions that are

16 adverse to health care professionals; and

17 ‘‘(C) the process of the issuer for appealing

18 such adverse decisions, including the presen19 tation of information and the views of the

20 health care professional regarding such deci21 sion.

22 ‘‘(2) GROUP HEALTH PLANS.—A group health

23 plan shall ensure that the organization that is re24 sponsible for maintaining the provider network in25 volved under the plan provides health care profes-
65

•S 1712 IS

1 sionals with the information described in paragraph

2 (1).

3 ‘‘(3) RULE OF CONSTRUCTION.—Nothing in

4 this subsection shall be construed to in any way ef5 fect a provision in a contract between a plan or

6 issuer and a health care professional that permits ei7 ther party to the contract to terminate the employ8 ment or participation of the professional under the

9 plan or issuer without cause.

10 ‘‘(b) COMMUNICATIONS.—

11 ‘‘(1) IN GENERAL.—An organization on behalf

12 of a group health plan (as described in subsection

13 (a)(2)) or a health insurance issuer shall not penal14 ize (financially or otherwise) a health care profes15 sional for advocating on behalf of his or her patient

16 or for providing information or referral for medical

17 care (as defined in section 2791(a)(2)) consistent

18 with the health care needs of the patient and with

19 the code of ethical conduct, professional responsibil20 ity, conscience, medical knowledge, and license of the

21 health care professional.

22 ‘‘(2) CONSTRUCTION.—Nothing in paragraph

23 (1) shall be construed as requiring a health insur24 ance issuer or a group health plan to pay for medi25 cal care not otherwise paid for or covered by the
66

•S 1712 IS

1 plan provided by nonparticipating health care profes2 sionals, except in those instances and to the extent

3 that the issuer or plan would normally pay for such

4 medical care.

5 ‘‘(3) ASSISTANCE AND SUPPORT.—A group

6 health plan or a health insurance issuer shall not

7 prohibit or otherwise restrict a health care profes8 sional from providing letters of support to, or in any

9 way assisting, enrollees who are appealing a denial,

10 termination, or reduction of service in accordance

11 with the procedures under section 2777.’’.

12 (b) APPLICATION TO GROUP HEALTH INSURANCE

13 COVERAGE.—

14 (1) IN GENERAL.—Subpart 2 of part A of title

15 XXVII of the Public Health Service Act is amended

16 by adding at the end the following new section:

17 ‘‘SEC. 2706. PROTECTION FOR CONSUMERS.

18 ‘‘(a) IN GENERAL.—Each health insurance issuer

19 shall comply with the protections and requirements under

20 part C with respect to group health insurance coverage

21 it offers.

22 ‘‘(b) ASSURING COORDINATION.—The Secretary of

23 Health and Human Services and the Secretary of Labor

24 shall ensure, through the execution of an interagency
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•S 1712 IS

1 memorandum of understanding between such Secretaries,

2 that—

3 ‘‘(1) regulations, rulings, and interpretations

4 issued by such Secretaries relating to the same mat5 ter over which such Secretaries have responsibility

6 under part C (and this section) and section 713 of

7 the Employee Retirement Income Security Act of

8 1974 are administered so as to have the same effect

9 at all times; and

10 ‘‘(2) coordination of policies relating to enforc11 ing the same requirements through such Secretaries

12 in order to have a coordinated enforcement strategy

13 that avoids duplication of enforcement efforts and

14 assigns priorities in enforcement.’’.

15 (2) CONFORMING AMENDMENT.—Section 2792

16 of such Act (42 U.S.C. 300gg–92) is amended by in17 serting ‘‘and section 2706(b)’’ after ‘‘of 1996’’.

18 (c) APPLICATION TO INDIVIDUAL HEALTH INSUR19 ANCE COVERAGE.—Part B of title XXVII of the Public

20 Health Service Act is amended by inserting after section

21 2751 the following new section:

22 ‘‘SEC. 2752. PROTECTION FOR CONSUMERS.

23 ‘‘Each health insurance issuer shall comply with the

24 protections and requirements under part C with respect

25 to individual health insurance coverage it offers.’’.
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•S 1712 IS

1 (d) DEFINITIONS.—Section 2791(d) of the Public

2 Health Service Act (42 U.S.C. 300gg–91(d)) is amend3 ed—

4 (1) by redesignating paragraphs (9) through

5 (14) as paragraphs (10) through (15), respectively;

6 and

7 (2) by inserting after paragraph (8), the follow8 ing:

9 ‘‘(9) HEALTH CARE PROFESSIONAL.—The term

10 ‘health care professional’ means a physician (as de11 fined in section 1861(r) of the Social Security Act)

12 or other health care professional if coverage for the

13 professional’s services is provided under the health

14 plan involved for the services of the professional.

15 Such term includes a podiatrist, optometrist, chiro16 practor, psychologist, dentist, physician assistant,

17 physical or occupational therapist and therapy as18 sistant, speech-language pathologist, audiologist,

19 registered or licensed practical nurse (including

20 nurse practitioner, clinical nurse specialist, certified

21 registered nurse anesthetist, and certified nurse-mid22 wife), licensed certified social worker, registered res23 piratory therapist, and certified respiratory therapy

24 technician.’’.
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•S 1712 IS

1 SEC. 312. AMENDMENTS TO THE EMPLOYEE RETIREMENT

2 INCOME SECURITY ACT OF 1974.

3 (a) IN GENERAL.—The Employee Retirement Income

4 Security Act of 1974 (29 U.S.C. 1001 et seq.) is amend5 ed—

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

7 and

8 (2) by inserting after subpart B, the following:

9 ‘‘SUBPART B—PROTECTION FOR CONSUMERS

10 ‘‘SEC. 720. EXEMPTION.

11 ‘‘(a) IN GENERAL.—Upon the application of a group

12 health plan or a health insurance issuer offering health

13 insurance coverage, the Secretary may exempt such plan

14 or issuer from compliance with 1 or more of the require15 ments of this part.

16 ‘‘(b) REQUIREMENTS.—The Secretary may grant an

17 exemption under this section if—

18 ‘‘(1) the Secretary—

19 ‘‘(A) publishes a notice of the pendency of

20 such exemption in the Federal Register; and

21 ‘‘(B) provides notice, and an opportunity

22 for comment, of the pendency of such exemp23 tion to interested individuals; and

24 ‘‘(2) the Secretary determines that the exemp25 tion—

26 ‘‘(A) is administratively feasible;
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•S 1712 IS

1 ‘‘(B) is in the interests of the group health

2 plan and the participants and beneficiaries

3 under such plan, or in the interests of the

4 health insurance issuer and the participants

5 and beneficiaries involved; and

6 ‘‘(C) is protective of the rights of partici7 pants and beneficiaries, as the case may be.

8 ‘‘(c) SCOPE OF EXEMPTION.—An exemption provided

9 under this section—

10 ‘‘(1) shall apply only to those requirements

11 identified by the Secretary in approving the exemp12 tion;

13 ‘‘(2) may be conditional; and

14 ‘‘(3) may be provided to a class of plans or

15 issuers.

16 ‘‘(d) PROCEDURES.—The Secretary shall develop

17 procedures to provide exemptions under this section.

18 ‘‘CHAPTER 1—CONSUMER INFORMATION

19 ‘‘SEC. 721. HEALTH PLAN COMPARATIVE INFORMATION.

20 ‘‘(a) REQUIREMENT.—A health insurance issuer in

21 connection with group health insurance coverage, shall,

22 not later than 12 months after the date of enactment of

23 this part, provide for the disclosure, in a clear and accu24 rate form to each plan sponsor, with which the issuer has

25 contracted, each participant or beneficiary, or upon re-
71

•S 1712 IS

1 quest to a potential participant or beneficiary or plan

2 sponsor, of the information described in subsection (b).

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

4 materials to be distributed under this section shall include

5 for each plan the following:

6 ‘‘(1) A description of the covered items and

7 services under each such plan and the in- and out8 of-network features of each such plan.

9 ‘‘(2) A description of any cost sharing, includ10 ing premiums, deductibles, coinsurance, and copay11 ment amounts, for which the participant or bene12 ficiary will be responsible, including any annual or

13 lifetime limits on benefits, for each such plan.

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

15 benefits offered by each such plan and the terms

16 and conditions (including premiums or cost-sharing)

17 for such supplemental coverage.

18 ‘‘(4) A description of any restrictions on pay19 ments for services furnished to a participant or ben20 eficiary by a health care professional that is not a

21 participating professional and the liability of the

22 participant or beneficiary for additional payments

23 for these services.
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1 ‘‘(5) A description of the service area of each

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

3 coverage.

4 ‘‘(6) A description of the extent to which par5 ticipants or beneficiaries may select the primary care

6 provider of their choice, including providers both

7 within the network and outside the network of each

8 such plan (if the plan permits out-of-network serv9 ices) as well as procedures for obtaining specialist

10 referral.

11 ‘‘(7) A summary of data concerning participant

12 or beneficiary satisfaction with the plan, including

13 disenrollment rates for the previous 2 plan years

14 (excluding disenrollments due to the death of a par15 ticipant or beneficiary or the participant or bene16 ficiary moving outside of the service area of the

17 plan), based on the health plan’s ‘book-of-business’.

18 Health plans may elect to provide specific informa19 tion regarding disenrollment rates.

20 ‘‘(8) A description of the procedures for ad21 vance directives and organ donation decisions.

22 ‘‘(9) A description of the requirements and pro23 cedures to be used to obtain preauthorization for

24 health services (including telephone numbers and
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•S 1712 IS

1 mailing addresses), including referrals for specialty

2 care.

3 ‘‘(10) A summary of the rules and methods for

4 appealing coverage decisions and filing grievances

5 (including telephone numbers and mailing address6 es), as well as other available remedies.

7 ‘‘(11) A summary of the rules for access to

8 emergency room care, including educational material

9 regarding proper use of emergency services.

10 ‘‘(12) A description of licensure, certification or

11 accreditation status of the health plan and the name

12 and address of the State or Federal regulatory agen13 cy with oversight responsibilities.

14 ‘‘(13) A description of whether or not access is

15 provided to experimental treatments, investigational

16 treatments, or clinical trials and the circumstances

17 under which access to such treatments or trials is

18 made available.

19 ‘‘(14) A description of whether or not access is

20 provided to specialists without referral and the cir21 cumstances under which assess to such specialists is

22 provided.

23 ‘‘(15) A description of the quality indicators

24 and health outcomes measures of the plan in accord25 ance with subsection (c).
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•S 1712 IS

1 ‘‘(16) A statement that the following informa2 tion, and instructions on obtaining such information

3 (including telephone numbers and Internet

4 websites), shall be made available upon request:

5 ‘‘(A) Additional information on the quality

6 of care and health outcomes under the plan.

7 ‘‘(B) The names, credentials, addresses,

8 and telephone numbers and the availability

9 (such as whether professionals accept patients),

10 speciality focus, affiliation arrangements, num11 ber and mix of the health care professionals in

12 the network of the plan, and any measures of

13 consumer satisfaction if such satisfaction meas14 ures are available.

15 ‘‘(C) The names and locations of partici16 pating health care facilities, the accreditation

17 status, the for-profit or not-for-profit status of

18 such facilities, and any measures of consumer

19 satisfaction if such satisfaction measures are

20 available.

21 ‘‘(D) A summary description of the meth22 ods used for compensating participating health

23 care professionals (including capitation, finan24 cial incentives or bonuses, fee-for-service, group

25 practice, salary and withholdings), including the
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•S 1712 IS

1 proportions of participating health care profes2 sionals who are compensated under each type of

3 arrangement under the plan.

4 ‘‘(E) A summary description of the proce5 dures used for utilization review, including the

6 process by which specific determinations are

7 made.

8 ‘‘(F) The list of the specific prescription

9 medications included in the formulary of the

10 plan, if the plan uses a defined formulary.

11 ‘‘(G) A description of the specific exclu12 sions from coverage under the plan.

13 ‘‘(H) A description of the specific prevent14 ative services covered under the plan.

15 ‘‘(I) A description of the availability of

16 translation or interpretation services for non17 English speakers and people with communica18 tion disabilities, including the availability of

19 audio tapes or information in Braille.

20 ‘‘(J) A description of the number of exter21 nal review requests that have been filed with an

22 external review panel designated in accordance

23 with section 727(e) and the outcome of such re24 quests by an external review panel in the pre25 ceding calendar year.
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•S 1712 IS

1 ‘‘(c) DETERMINATION OF INDICATORS AND MEAS2 URES.—

3 ‘‘(1) IN GENERAL.—The Secretary, in consulta4 tion with the Secretary of Health and Human Serv5 ices, shall develop quality indicators and health out6 comes measures for use by health insurance issuers

7 offering group health insurance coverage in provid8 ing the information required under section (b), tak9 ing into consideration the recommendations of the

10 Health Quality Council established under section

11 101 of the Health Care Quality, Education, Secu12 rity, and Trust Act (referred to in this subpart as

13 the ‘Council’). Such quality indicators and health

14 outcomes measures shall, while taking into consider15 ation the different populations served (such as chil16 dren and individuals with disabilities), be consistent

17 where appropriate with requirements applicable to

18 Medicare+Choice health plans under title XVIII of

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

20 ‘‘(2) DIFFERENT INDICATORS AND OUTCOMES

21 MEASURES.—The Secretary of Health and Human

22 Services and the Secretary of Labor may adopt qual23 ity indicators or health outcomes measures that are

24 in a different form than the indicators or outcomes
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•S 1712 IS

1 measures recommended by the Council under para2 graph (1) if—

3 ‘‘(A) the Secretary of Health and Human

4 Services or the Secretary of Labor finds that

5 different indicators or outcomes measures will

6 substantially reduce administrative costs to

7 health care providers and health plans as com8 pared to the alternatives, or that such indica9 tors or measures are demonstrated or proven to

10 be more appropriate for the populations served;

11 and

12 ‘‘(B) the indicators or outcomes measures

13 are adopted in accordance with the rulemaking

14 procedures of subchapter III of chapter 5 of

15 title 5, United States Code.

16 ‘‘(d) MANNER OF DISTRIBUTION.—

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

18 in this section shall—

19 ‘‘(A) be distributed in an accessible format

20 that is understandable to an average plan par21 ticipant or beneficiary; and

22 ‘‘(B) with respect to populations of individ23 uals whose primary language is other than

24 English, be provided in the primary language of

25 such population if that population comprises
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•S 1712 IS

1 not less than 20 percent of the total population

2 of the geographic area served by the health plan

3 involved.

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

5 of this section, a health insurance issuer, in reliance

6 on records maintained by the issuer, shall be deemed

7 to have met the requirements of this section if the

8 issuer provides the information requested under this

9 section to enrollees at the address contained in such

10 records with respect to such enrollees.

11 ‘‘(e) RULE OF CONSTRUCTION.—Nothing in this sec12 tion may be construed to prohibit a health insurnace

13 issuer offering group health insurance coverage from dis14 tributing any other information determined to be impor15 tant or necessary in assisting participants or beneficiaries

16 or upon request potential participants or beneficiaries in

17 the selection of a health plan.

18 ‘‘CHAPTER 2—CONSUMER PROTECTION

19 AND PLAN STANDARDS

20 ‘‘SEC. 725. EMERGENCY SERVICES.

21 ‘‘(a) ACCESS TO SERVICES.—A group health plan or

22 a health insurance issuer offering group health insurance

23 coverage who provides coverage for emergency service

24 shall ensure that emergency services are available and ac25 cessible 24 hours a day and 7 days a week.
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•S 1712 IS

1 ‘‘(b) PAYMENT FOR SERVICES.—A group health plan

2 or a health insurance issuer offering group health insur3 ance coverage described in subsection (a), shall cover

4 emergency services furnished under the plan or coverage—

5 ‘‘(1) in a manner so that, if such services are

6 provided to a participant or beneficiary by a non7 participating health care provider—

8 ‘‘(A) the participant or beneficiary shall

9 not be liable for amounts paid for such services

10 in excess of the amount that would have been

11 paid if the services were provided by a partici12 pating health care provider; and

13 ‘‘(B) the plan or issuer shall pay an

14 amount for such services that is not less than

15 the amount that would be paid to a participat16 ing health care provider for the same services;

17 and

18 ‘‘(2) without regard to any other term or condi19 tion of such plan or coverage (other than exclusion

20 or coordination of benefits, or an affiliation or wait21 ing period permitted under section 701, and other

22 than applicable cost-sharing requirements).

23 ‘‘(c) PRIOR AUTHORIZATION.—A group health plan

24 or a health insurance issuer offering group health insur25 ance coverage described in subsection (a) shall provide
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1 coverage for emergency services without regard to prior

2 authorization or the emergency care provider’s contractual

3 relationship with the plan involved.

4 ‘‘(d) GUIDELINES RESPECTING COORDINATION OF

5 POST-STABILIZATION CARE.—

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

7 health insurance issuer offering group health insur8 ance coverage shall comply with guidelines estab9 lished by the Secretary of Health and Human Serv10 ices (with respect to health insurance issuers) and

11 the Secretary of Labor (with respect to group health

12 plans) relating to promoting efficient and timely co13 ordination of appropriate maintenance and post-sta14 bilization care of a participant or beneficiary after

15 the participant or beneficiary has been determined

16 to be stable (as defined for purposes of section 1867

17 of the Social Security Act).

18 ‘‘(2) GUIDELINES.—The guidelines established

19 by the Secretary of Health and Human Services and

20 the Secretary of Labor under paragraph (1) shall be

21 the guidelines adopted with respect to appropriate

22 maintenance and post-stabilization care for

23 Medicare+Choice plans under part C of title XVIII

24 of the Social Security Act.

25 ‘‘(e) DEFINITIONS.—In this section:
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1 ‘‘(1) EMERGENCY SERVICES.—The term ‘emer2 gency services’ means, with respect to a participant

3 or beneficiary in a health plan, covered inpatient and

4 outpatient services that are needed to evaluate or

5 stabilize an emergency medical condition (as defined

6 in paragraph (2)).

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

8 term ‘emergency medical condition’ means a medical

9 condition manifesting itself by acute symptoms of

10 sufficient severity (including severe pain) such that

11 a prudent layperson, who possesses an average

12 knowledge of health and medicine, could reasonably

13 expect the absence of immediate medical attention to

14 result in—

15 ‘‘(A) placing the health of the individual

16 (or, with respect to a pregnant woman, the

17 health of the woman or her unborn child) in se18 rious jeopardy;

19 ‘‘(B) serious impairment to bodily func20 tions; or

21 ‘‘(C) serious dysfunction of any bodily

22 organ or part.

23 ‘‘(2) POST-STABILIZATION CARE.—The term

24 ‘post-stabilization care’ means, with respect to an in25 dividual who is determined to be stable under section
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•S 1712 IS

1 1867 of the Social Security Act pursuant to a medi2 cal screening examination or who is stabilized after

3 provision of emergency services, medically necessary

4 items and services (other than emergency services

5 and other than maintenance care) that are required

6 by the individual.

7 ‘‘SEC. 726. ADVANCE DIRECTIVES AND ORGAN DONATION.

8 ‘‘A group health plan or health insurance issuer offer9 ing group health insurance coverage shall maintain written

10 policies and procedures with respect to advance directives

11 (as such term is defined in section 1866(f)(3) of the Social

12 Security Act (42 U.S.C. 1395cc(f)(3))) and organ dona13 tion decisions on the part of a participant or beneficiary.

14 Nothing in the preceding sentence shall be construed to

15 require the provision of information regarding assisted

16 suicide, euthanasia, or mercy killing.

17 ‘‘SEC. 727. COVERAGE DETERMINATION, GRIEVANCES AND

18 APPEALS.

19 ‘‘(a) COVERAGE DETERMINATIONS.—

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

21 health insurance issuer offering group health insur22 ance coverage shall ensure that procedures are in

23 place for—

24 ‘‘(A) making determinations regarding

25 whether a participant or beneficiary is eligible
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1 to receive a payment or coverage for health

2 service under the plan or coverage involved and

3 the amount (if any) that the participant or ben4 eficiary is required to pay with respect to such

5 service;

6 ‘‘(B) notifying participant or beneficiary

7 (or individuals acting on behalf of such partici8 pants or beneficiaries) and health care profes9 sionals providing the service involved regarding

10 determinations made by the plan or issuer and

11 any additional payments that the participant or

12 beneficiary may be required to make with re13 spect to such service; and

14 ‘‘(C) responding to either written or oral

15 requests for coverage determinations from a

16 participant or beneficiary (or an individual act17 ing on behalf of a participant or beneficiary) or

18 a treating health care professional.

19 ‘‘(2) ROUTINE DETERMINATION.—

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

21 or a health insurance issuer offering group

22 health insurance coverage shall ensure that

23 prior authorization determinations concerning

24 the provision of non-emergency items or serv25 ices are made within 15 days of the date on
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1 which the plan or issuer receives a request for

2 such a determination.

3 ‘‘(B) INCOMPLETE INFORMATION.—If a

4 determination cannot be made under subpara5 graph (A) within the 15 day period referred to

6 in such subparagraph, because of the incom7 plete nature of the medical or coverage informa8 tion involved, the plan or issuer shall provide a

9 written notification of such fact to the partici10 pant or beneficiary (or individual acting on be11 half of the participant or beneficiary) and the

12 treating health care professional.

13 ‘‘(C) SUBMISSION OF ADDITIONAL INFOR14 MATION.—Upon receipt of a notification under

15 subparagraph (B), a participant or beneficiary

16 (or individual acting on behalf of a participant

17 or beneficiary) or the treating health care pro18 fessional shall submit the additional information

19 required within the 30-day period beginning on

20 the date on which such notification is received.

21 ‘‘(D) DETERMINATION.—A group health

22 plan or health insurance issuer offering group

23 health insurance coverage shall make a deter24 mination under this paragraph within 2 work-
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•S 1712 IS

1 ing days of the date on which complete informa2 tion is obtained.

3 ‘‘(3) EXPEDITED DETERMINATION.—

4 ‘‘(A) IN GENERAL.—A prior authorization

5 determination under this subsection shall be

6 made within 72 hours after a request is re7 ceived by the plan or issuer if the request indi8 cates that the treating health care professional

9 (regardless of whether the professional is affili10 ated with the plan or issuer involved) certifies

11 that a determination under the procedures de12 scribed in paragraph (2) could seriously jeop13 ardize the life or health of the participant or

14 beneficiary or the ability of the participant or

15 beneficiary to regain maximum function.

16 ‘‘(B) INFORMATION.—In an expedited re17 view under this paragraph, all necessary infor18 mation shall be transmitted between the plan or

19 issuer and the participant or beneficiary (or in20 dividual acting on behalf of the participant or

21 beneficiary) and the treating health care profes22 sional by the most expeditious method available.

23 ‘‘(C) NOTICE.—Notice of a determination

24 under an expedited review shall be provided to

25 the participant or beneficiary (or individual act-
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1 ing on behalf of the participant or beneficiary)

2 and the treating health care professional within

3 the 72-hour period referred to in subparagraph

4 (A) by the most expedient method available.

5 Written confirmation of such determination

6 shall be provided to the participant or bene7 ficiary (or individual) or treating health care

8 professional within 2 working days of the initial

9 notice.

10 ‘‘(4) NOTICE OF DETERMINATIONS.—

11 ‘‘(A) APPROVAL.—With respect to the rou12 tine determination of a plan or issuer under

13 paragraph (2) to certify an admission, proce14 dure or service, with respect to a participant or

15 beneficiary, the plan or issuer shall provide no16 tice of such determination to the treating health

17 care professional involved within 24 hours of

18 making such determination. A written or elec19 tronic confirmation of such determination shall

20 be made to such professional and participant or

21 beneficiary (or individual acting on behalf of

22 the participant or beneficiary) within 2 working

23 days of the date on which the initial notice was

24 provided.
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•S 1712 IS

1 ‘‘(B) ADVERSE DETERMINATIONS.—With

2 respect to a routine adverse determination by a

3 plan or issuer under paragraph (2), the plan or

4 issuer shall provide notice of such determination

5 to the treating health care professional within

6 24 hours of making the determination. A writ7 ten or electronic confirmation of such deter8 mination shall be made to such professional,

9 and a written notice of such determination shall

10 be made to the participant or beneficiary in11 volved (or individual acting on behalf of an indi12 vidual), within 1 working day of the date on

13 which the initial notice was provided.

14 ‘‘(C) CONCURRENT REVIEWS.—With re15 spect to the determination of a plan or issuer

16 under paragraph (1) to certify or deny an ex17 tended stay or additional services, the plan or

18 issuer shall provide notice of such determination

19 to the health care provider rendering the service

20 involved within 1 working day of making such

21 determination. A written or electronic confirma22 tion of such determination shall be made to

23 such professional and to the participant or ben24 eficiary involved (or individual acting on behalf

25 of the participant or beneficiary) within 1 work-
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•S 1712 IS

1 ing day of the date on which the initial notice

2 was provided.

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

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

7 30 working days of the date on which the plan

8 or issuer receives all necessary information. The

9 plan or issuer shall provide written notice of an

10 approval or disapproval of a determination

11 under this subparagraph to the participant or

12 beneficiary (or individual acting on behalf of

13 the participant or beneficiary) and health care

14 provider involved within 5 working days of the

15 date on which such determination is made.

16 ‘‘(E) REQUIREMENT OF NOTICE.—A writ17 ten or electronic notice of an adverse deter18 mination under subparagraph (B), (C) or (D),

19 or of an expedited adverse determination under

20 paragraph (3), shall be provided to the partici21 pant or beneficiary (or individual acting on be22 half of the participant or beneficiary) and

23 health care provider (if any) involved and shall

24 include—
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•S 1712 IS

1 ‘‘(i) the reasons for the determination

2 (including the clinical rationale) written in

3 a manner to be understandable (to the ex4 tent possible) to the average participant or

5 beneficiary;

6 ‘‘(ii) the procedures for obtaining ad7 ditional information concerning the deter8 mination; and

9 ‘‘(iii) notification of the right to ap10 peal the determination and instructions on

11 how to initiate an appeal in accordance

12 with subsection (d)(2).

13 ‘‘(5) DEFINITION.—As used in this section, the

14 term ‘adverse determination’ with respect to a group

15 health plan or health insurance coverage means a

16 determination to deny, reduce or terminate services,

17 deny payment for services, or any decision to deny

18 coverage based on a lack of medical necessity, under

19 the terms and conditions of such plan or coverage.

20 ‘‘(b) NOTICE FOR OTHER DETERMINATIONS.—A

21 group health plan or a health insurance issuer offering

22 group health insurance coverage shall provide written no23 tice to a participant or beneficiary (or individual acting

24 on behalf of a participant or beneficiary) and a health care

25 professional involved of a determination by the plan or
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•S 1712 IS

1 issuer to deny, reduce or terminate services or deny pay2 ment for services. Such notification shall include a brief

3 explanation (written in a manner to be understood by an

4 average participant or beneficiary) of the reasons for the

5 determination, procedures for obtaining additional infor6 mation, and procedures for appealing the determination.

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

8 insurance issuer offering group health insurance coverage

9 shall have written procedures for addressing grievances

10 between the plan and participants or beneficiaries, includ11 ing grievances relating to waiting periods, operating hours,

12 the demeanor of personnel, and the adequacy of facilities.

13 Determinations under such procedures shall be non-ap14 pealable.

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

17 ‘‘(1) IN GENERAL.—A participant or beneficiary

18 (or an individual acting on behalf of a participant or

19 beneficiary) and the treating health care professional

20 with the consent of the participant or beneficiary (or

21 an individual acting on behalf of an individual or

22 beneficiary), may appeal (orally or in writing) any

23 adverse determination under subsection (a) or (b)

24 under the procedures described in this subsection.
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•S 1712 IS

1 ‘‘(2) APPEAL.—A group health plan and a

2 health insurance issuer offering group health insur3 ance coverage shall establish and maintain an inter4 nal appeal process under which any participant or

5 beneficiary (or an individual acting on behalf of any

6 participant or beneficiary) or the treating health

7 care professional with the consent of the participant

8 or beneficiary (or an individual acting on behalf of

9 the participant or beneficiary), who is dissatisfied

10 with any adverse determination has the opportunity

11 to discuss and appeal (either orally or in writing)

12 that decision.

13 ‘‘(3) RECORDS.—A group health plan and a

14 health insurance issuer offering group health insur15 ance coverage shall maintain written records with re16 spect to any appeal under this subsection for pur17 poses of internal quality assurance and improve18 ment.

19 ‘‘(4) WRITTEN REQUEST.—With respect to an

20 oral request under paragraph (1), a group health

21 plan or a health insurance issuer offering group

22 health insurance coverage may require that the re23 questing individual provide written evidence of such

24 request for record keeping purposes. A request for

25 written evidence under the preceding sentence shall
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•S 1712 IS

1 not be used by a group health plan or health insur2 ance issuer to delay the initiation of the appeals

3 process under this subsection pending the receipt of

4 such evidence.

5 ‘‘(5) ROUTINE DETERMINATIONS.—Except as

6 provided for in paragraph (6), a group health plan

7 or a health insurance issuer offering group health

8 insurance coverage shall provide for the consider9 ation of an appeal of an adverse determination

10 under this subsection not later than 30 days after

11 the date on which a request for such appeal is re12 ceived.

13 ‘‘(6) EXPEDITED DETERMINATION.—A deter14 mination with respect to an appeal under this sub15 section shall, upon the written or oral request of any

16 participant or beneficiary (or an individual acting on

17 behalf of the participant or beneficiary) or the treat18 ing health care professional, be made within 72

19 hours after the request for such appeal is received

20 by the plan or issuer if the request indicates that the

21 treating health care professional (regardless of

22 whether the professional is affiliated with the plan

23 or issuer involved) certifies that a determination

24 under the procedures described in paragraph (5)

25 could seriously jeopardize the life or health of the
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•S 1712 IS

1 participant or beneficiary or the ability of the partic2 ipant or beneficiary to regain maximum function.

3 ‘‘(7) CONDUCT OF REVIEW.—A review of a de4 termination under this subsection shall be conducted

5 by health care professionals who are knowledgeable

6 about the participant’s or beneficiary’s condition and

7 the treatment or service involved, including physi8 cians and other trained health care professionals.

9 Such review shall not be conducted by an individual

10 who was involved in the initial decision.

11 ‘‘(8) LACK OF MEDICAL NECESSITY.—An ap12 peal under this subsection relating to a determina13 tion to deny coverage based on a lack of medical ne14 cessity or appropriateness shall be made only by a

15 physician with appropriate expertise in the field of

16 medicine involved who is not involved in the initial

17 determination.

18 ‘‘(9) NOTICE.—

19 ‘‘(A) IN GENERAL.—Written notice—

20 ‘‘(i) of a determination made under

21 paragraph (6) shall be provided to the par22 ticipant or beneficiary (or individual acting

23 on behalf of the participant or beneficiary)

24 and the treating health care professional

25 within the 72-hour period referred to in
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•S 1712 IS

1 such paragraph in the most expeditious

2 manner possible; and

3 ‘‘(ii) of a determination under para4 graph (5), shall be provided to the partici5 pant or beneficiary (or individual acting on

6 behalf of the participant or beneficiary)

7 and the treating health care professional in

8 writing within 2 working days after the

9 completion of the review referred to in

10 such paragraph.

11 ‘‘(B) ADVERSE DETERMINATIONS.—With

12 respect to an adverse determination made under

13 paragraph (5) or (6), the notice described in

14 subparagraph (A) shall include written informa15 tion on how the determination may be appealed

16 to an external entity under subsection (e).

17 ‘‘(e) EXTERNAL REVIEW.—

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

19 health insurance issuer offering group health insur20 ance coverage shall have written procedures to per21 mit a participant or beneficiary (or an individual

22 acting on behalf of a participant or beneficiary) or

23 the treating health care professional with the con24 sent of the participant or beneficiary (or individual),

25 the right to an external appeal of an adverse deter-
95

•S 1712 IS

1 mination if such determination involves treatments

2 or services covered by the terms and condition of the

3 plan that cost at least $1,000.

4 ‘‘(2) ELIGIBILITY FOR DESIGNATION AS EXTER5 NAL REVIEW PANEL.—

6 ‘‘(A) DESIGNATION.—The appropriate

7 State agent shall designate individuals who are

8 eligible to serve on, or entities eligible to act as,

9 an external review panel to review external ap10 peals brought under this subsection.

11 ‘‘(B) REQUIREMENTS.—In designating in12 dividuals or entities under subparagraph (A),

13 the State agent shall ensure that the individual

14 or entity is licensed or certified to conduct ex15 ternal reviews by—

16 ‘‘(i) the State agent, in accordance

17 with licensing and certification procedures

18 to be developed by the State in consulta19 tion with the National Association of In20 surance Commissioners; or

21 ‘‘(ii) in the case of a State that—

22 ‘‘(I) has not established such li23 censing and certification procedures

24 within 24 months of the date of enact25 ment of this subpart, the State in ac-
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•S 1712 IS

1 cordance with procedures to be devel2 oped by the Secretary; or

3 ‘‘(II) refuses to designate such

4 panels, the Secretary.

5 ‘‘(C) LIABILITY.—An individual designated

6 to an external review panel under this sub7 section shall not be held liable for any decision

8 made by such panel.

9 ‘‘(3) INITIATION OF THE EXTERNAL REVIEW

10 PROCESS.—

11 ‘‘(A) FILING OF REQUEST.—A participant

12 or beneficiary (or individual acting on behalf of

13 a participant or beneficiary) or the treating

14 health care professional with the consent of the

15 participant or beneficiary (or individual) who

16 desires to have an external review conducted

17 under this subsection shall file a written request

18 for such a review with the plan or issuer in19 volved and the appropriate State agent not later

20 than 30 days after the receipt of a final denial

21 of a claim under subsection (d). Any such re22 quest shall include the consent of the partici23 pant or beneficiary for the release of confiden24 tial medical information regarding the partici25 pant or beneficiary if such information is nec-
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•S 1712 IS

1 essary for the proper conduct of the external re2 view.

3 ‘‘(B) INFORMATION AND NOTICE.—Not

4 later than 5 working days after the receipt of

5 a request under subparagraph (A), the plan or

6 issuer involved shall—

7 ‘‘(i) forward all necessary information

8 (including medical records, any relevant re9 view criteria, the clinical rationale for the

10 denial, and evidence of the participant’s or

11 beneficiary’s coverage) to the appropriate

12 State agent (or the designee of such

13 agent); and

14 ‘‘(ii) send a written notification to the

15 participant or beneficiary (or individual

16 acting on behalf of the participant or bene17 ficiary), the treating health care profes18 sional, and the plan administrator, indicat19 ing that an external review has been initi20 ated.

21 ‘‘(C) APPOINTMENT OF PANEL.—Not later

22 than 30 days after the information and notifica23 tion are provided under subsection (b)—

24 ‘‘(i) the State agent, in the case of a

25 plan or issuer involved that is fully in-
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•S 1712 IS

1 sured, shall appoint an external review

2 panel from among the individuals and enti3 ties eligible under paragraph (2);

4 ‘‘(ii) the plan fiduciary, in the case of

5 a plan or issuer involved that is self-in6 sured, shall appoint an external review

7 panel from among the individuals and enti8 ties eligible under paragraph (2); or

9 ‘‘(iii) the State agent, in the case of

10 a group health plan where the plan spon11 sor directly provided health care under

12 such plan.

13 ‘‘(D) REQUIREMENTS.—A review panel ap14 pointed under subparagraph (C) shall—

15 ‘‘(i) consist of at least 3 physicians or

16 other health care professionals who are ex17 perts in the treatment of the participant’s

18 or beneficiary’s condition and knowledge19 able about the recommended treatment; or

20 ‘‘(ii) be an impartial review entity in21 cluding a medical peer review organization

22 or an independent utilization review com23 pany.

24 ‘‘(E) APPROVAL OF PARTICIPANT OR BEN25 EFICIARY.—Not later than 15 days after the
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•S 1712 IS

1 date on which an external review panel is des2 ignated under this paragraph, the participant

3 or beneficiary involved shall, in writing—

4 ‘‘(i) approve such panel; or

5 ‘‘(ii) object to such panel and select

6 alternative individuals or entities who are

7 eligible under paragraph (2) to serve on

8 such panel.

9 Individuals or entities approved or selected

10 under this subparagraph shall serve as the ex11 ternal review panel under this subsection with

12 respect to the participant or beneficiary in13 volved.

14 ‘‘(F) CONFLICT OF INTEREST.—An exter15 nal review panel designated under this para16 graph shall not have any material, professional,

17 familial, or financial affiliation with the health

18 plan, health insurance issuer or the participant

19 or beneficiary involved, or any officer, director,

20 or management employee of the plan, issuer,

21 physician, medical group, or association rec22 ommending the treatment, the institution where

23 the treatment would take place, or the manu24 facturer of any drug, device, procedure, or other
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•S 1712 IS

1 therapy proposed for the participant or bene2 ficiary whose treatment is under review.

3 ‘‘(4) STANDARD OF REVIEW.—An external re4 view panel designated under paragraph (3) shall—

5 ‘‘(A) complete a review of an adverse de6 termination not later than 30 days after the

7 later of—

8 ‘‘(i) the date on which such panel is

9 approved under paragraph (4)(E); or

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

11 necessary to completing such review is re12 ceived;

13 ‘‘(B) take into consideration the benefits

14 and coverage provided under the terms and con15 ditions of the plan involved;

16 ‘‘(C) follow a standard of review that pro17 motes evidence-based decision making; and

18 ‘‘(D) submit a report on the final deter19 minations of the panel to—

20 ‘‘(i) the plan or issuer involved;

21 ‘‘(ii) the participant or beneficiary in22 volved (or individual acting on behalf of

23 the participant or beneficiary);

24 ‘‘(iii) the health care professional in25 volved; and
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•S 1712 IS

1 ‘‘(iv) the State agent responsible for

2 designating review panels under paragraph

3 (2).

4 ‘‘(5) FILING FEE.—A State may impose a filing

5 fee to be applied to a participant or beneficiary initi6 ating an external review under this subsection. If a

7 State elects to impose such a filing fee, the State

8 must include a procedure to provide for a fee reduc9 tion if the participant or beneficiary demonstrates fi10 nancial hardship through status or evidence of par11 ticipation in a State or Federal cash assistance pro12 gram.

13 ‘‘(6) PAYMENT FOR EXTERNAL REVIEW.—A

14 group health plan or health insurance issuer offering

15 group health insurance coverage shall be financially

16 responsible for any reasonable costs associated with

17 the conduct of an external review under this sub18 section.

19 ‘‘(7) ANNUAL REPORTING.—The appropriate

20 State agent shall conduct annual reviews of the

21 number of external reviews requested under this sub22 section and the outcomes of such reviews. A report

23 concerning such annual reviews shall be made public

24 and forwarded to the Secretary of Health and

25 Human Services (with respect to health insurance
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•S 1712 IS

1 issuers) and the Secretary of Labor (with respect to

2 reports on group health plans). Such reports shall

3 breakdown the results by relevance to group health

4 plans and health insurance issuers.

5 ‘‘(8) AUDITS.—Not later than 2 years after the

6 date of enactment of this subpart, the General Ac7 counting Office shall conduct a review of all licensed,

8 certified, or appointed review panels under para9 graph (3). Such review shall include an assessment

10 of the process involved during an external review

11 and the basis of decisionmaking by the board or

12 panel.

13 ‘‘(9) RULE OF CONSTRUCTION.—The deter14 mination of an external review panel shall be binding

15 on the plan or issuer involved, except that nothing

16 in this subsection shall be construed to preclude the

17 right of a group health plan, health insurance issuer,

18 or a participant or beneficiary from commencing a

19 civil action based on the plan or coverage involved.

20 ‘‘(f) PRIOR AUTHORIZATION DETERMINATION.—For

21 purposes of this section. the term ‘prior authorization de22 termination’ means, with respect to items and services for

23 which coverage may be provided under a health plan, a

24 determination (before the provision of the items and serv25 ices and as a condition of coverage of the items and serv-
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1 ices under the coverage) of whether or not such items and

2 services will be covered under the coverage.

3 ‘‘SEC. 728. CONFIDENTIALITY AND ACCURACY OF PARTICI4 PANTS AND BENEFICIARIES RECORDS.

5 ‘‘A group health plan or a health insurance issuer of6 fering group health insurance coverage shall establish pro7 cedures with respect to medical records or other health

8 information maintained regarding participants or bene9 ficiaries to safeguard the privacy of any individually iden10 tifiable participant or beneficiary information.

11 ‘‘CHAPTER 3—HEALTH CARE

12 PROFESSIONAL PROTECTIONS

13 ‘‘SEC. 730. HEALTH CARE PROFESSIONAL COMMUNICA14 TIONS.

15 ‘‘(a) PROVISION OF INFORMATION TO PROFES16 SIONALS.—

17 ‘‘(1) HEALTH INSURANCE ISSUERS.—A health

18 insurance issuer offering group health insurance cov19 erage shall establish procedures concerning the par20 ticipation of health care professionals under coverage

21 provided by the issuer under which such profes22 sionals will be provided with written notice of—

23 ‘‘(A) the rules of the issuer concerning

24 participation;
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1 ‘‘(B) any participation decisions that are

2 adverse to health care professionals; and

3 ‘‘(C) the process of the issuer for appealing

4 such adverse decisions, including the presen5 tation of information and the views of the

6 health care professional regarding such deci7 sion.

8 ‘‘(2) GROUP HEALTH PLANS.—A group health

9 plan shall ensure that the organization that is re10 sponsible for maintaining the provider network in11 volved under the plan provides health care profes12 sionals with the information described in paragraph

13 (1).

14 ‘‘(3) RULE OF CONSTRUCTION.—Nothing in

15 this subsection shall be construed to in any way ef16 fect a provision in a contract between a plan or

17 issuer and a health care professional that permits ei18 ther party to the contract to terminate the employ19 ment or participation of the professional under the

20 plan or issuer without cause.

21 ‘‘(b) COMMUNICATIONS.—

22 ‘‘(1) IN GENERAL.—An organization on behalf

23 of a group health plan (as described in subsection

24 (a)(2)) or a health insurance issuer offering group

25 health insurance coverage shall not penalize (finan-
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1 cially or otherwise) a health care professional for ad2 vocating on behalf of his or her patient or for pro3 viding information or referral for medical care (as

4 defined in section 733(a)(2)) consistent with the

5 health care needs of the patient and with the code

6 of ethical conduct, professional responsibility, con7 science, medical knowledge, and license of the health

8 care professional.

9 ‘‘(2) CONSTRUCTION.—Nothing in paragraph

10 (1) shall be construed as requiring a health insur11 ance issuer offering group health insurance coverage

12 or a group health plan to pay for medical care not

13 otherwise paid for or covered by the plan provided

14 by nonparticipating health care professionals, except

15 in those instances and to the extent that the issuer

16 or plan would normally pay for such medical care.

17 ‘‘(3) ASSISTANCE AND SUPPORT.—A group

18 health plan or a health insurance issuer offering

19 group health insurance coverage shall not prohibit or

20 otherwise restrict a health care professional from

21 providing letters of support to, or in any way assist22 ing, participants or beneficiaries who are appealing

23 a denial, termination, or reduction of service in ac24 cordance with the procedures under section 727.’’.

25 (b) CONFORMING AMENDMENTS.—
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1 (1) Section 732(a) of the Employee Retirement

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

3 amended by striking ‘‘section 711, and inserting

4 ‘‘section 711 and subpart C’’.

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

6 Employee Retirement Income Security Act of 1974

7 (29 U.S.C. 1001) is amended—

8 (A) in the item relating to subpart C, by

9 striking ‘‘Subpart C’’ and inserting ‘‘Subpart

10 D’’; and

11 (B) by inserting after the item relating to

12 section 712, the following:

‘‘SUBPART B—PROTECTION FOR CONSUMERS

‘‘Sec. 720. Exemption.

‘‘CHAPTER 1—CONSUMER INFORMATION

‘‘Sec. 721. Health plan comparative information.

‘‘CHAPTER 2—CONSUMER PROTECTION AND PLAN STANDARDS

‘‘Sec. 725. Emergency services.

‘‘Sec. 726. Advance directives and organ donation.

‘‘Sec. 727. Coverage determination, grievances and appeals.

‘‘Sec. 728. Confidentiality and accuracy of participants and beneficiaries

records.

‘‘CHAPTER 3—HEALTH CARE PROFESSIONAL PROTECTIONS

‘‘Sec. 730. Health care professional communications.’’.

Æ