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[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4220 Introduced in House (IH)]

104th CONGRESS
  2d Session
                                H. R. 4220

To amend the Internal Revenue Code of 1986 and titles XVIII and XIX of 
the Social Security Act to ensure access to services and prevent fraud 
 and abuse for enrollees of managed care plans, to amend standards for 
Medicare supplemental policies, to modify the Medicare select program, 
  and to provide other protections for beneficiaries of health plans 
                   generally, and for other purposes.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                           September 26, 1996

  Mr. Stark introduced the following bill; which was referred to the 
   Committee on Ways and Means, and in addition to the Committee on 
Commerce, for a period to be subsequently determined by the Speaker, in 
   each case for consideration of such provisions as fall within the 
                jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL

 
To amend the Internal Revenue Code of 1986 and titles XVIII and XIX of 
the Social Security Act to ensure access to services and prevent fraud 
 and abuse for enrollees of managed care plans, to amend standards for 
Medicare supplemental policies, to modify the Medicare select program, 
  and to provide other protections for beneficiaries of health plans 
                   generally, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Managed Care 
Consumer Protection Act of 1996''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
 TITLE I--PROTECTIONS FOR BENEFICIARIES ENROLLED IN MANAGED CARE PLANS

  ``Subtitle L--Protections for Beneficiaries Under Managed Care Plans

 ``CHAPTER 101--PRO``subchapter a--imposition of taxMANAGED CARE PLANS
        ``Sec. 9901. Excise tax on failure to meet requirement of 
                            beneficiary protection.
        ``Sec. 9902. D``subchapter b--requirements
        ``Sec. 9911. Requirements relating to managed care 
                            organizations and providers of health 
                            services.
        ``Sec. 9912. Grievance procedures and deadline for responding 
                            to requests for coverage of services.
        ``Sec. 9913. Requirements for organization service areas; 
                            nondiscrimination.
        ``Sec. 9914. Providing information.
        ``Sec. 9915. Restrictions on commissions for agents.
        ``Sec. 9916. Protection of patient right to know.
        ``Sec. 9917. Patient access to clinical studies.
        ``Sec. 9918. Required minimum childbirth benefits.
        ``Sec. 9919. Assuring equitable health plan coverage with 
                            respect to emergency services.
                       Subtitle C--Effective Date

Sec. 121. Effective date.
                           TITLE II--MEDICARE

Sec. 201. Prohibition on payments under Medicare until completion of 
                            orientation and medical profile.
Sec. 202. Changes in requirements for Medicare supplemental policies 
                            relating to community rating and loss 
                            ratios.
Sec. 203. Other additional consumer protections for Medicare 
                            supplemental insurance.
Sec. 204. Application of standards to Medicare select policies.
Sec. 205. Arrangements for out-of-area dialysis services.
Sec. 206. Coordination of Medicare enrollment.
                          TITLE III--MEDICAID

Sec. 301. Prohibition on payments under Medicaid until completion of 
                            orientation, medical profile, and 
                            immunization.
Sec. 302. Requirement for Medicaid capitated plans to assure 
                            appropriate childhood immunizations.

 TITLE I--PROTECTIONS FOR BENEFICIARIES ENROLLED IN MANAGED CARE PLANS

    (a) In General.--The Internal Revenue Code of 1986 (as amended by 
the Health Insurance Portability and Accountability Act of 1996) is 
amended by adding at the end the following:

  ``Subtitle L--Protections for Beneficiaries Under Managed Care Plans

 ``CHAPTER 101--PROTECTIONS FOR BENEFICIARIES UNDER MANAGED CARE PLANS

                              ``Subchapter A. Imposition of tax.
                              ``Subchapter B. Requirements.

                   ``Subchapter A--Imposition of Tax

                              ``Sec. 9901. Excise tax on failure to 
                                        meet requirement of beneficiary 
                                        protection.
                              ``Sec. 9902. Definitions.

``SEC. 9901. EXCISE TAX ON FAILURE TO MEET REQUIREMENT OF BENEFICIARY 
              PROTECTION.

    ``(a) Imposition of Tax.--There is hereby imposed a tax on the 
failure of--
            ``(1) a managed care group health plan to meet the 
        requirements of subchapter B; and
            ``(2) an insurer that offers managed care health insurance 
        coverage (other than to a group health plan subject to 
        paragraph (1)) to meet the requirements of such subchapter.
    ``(b) Amount of Tax.--
            ``(1) Group health plan.--
                    ``(A) In general.--The amount of tax imposed by 
                subsection (a)(1) on any failure with respect to a 
                participant or beneficiary of a group health plan shall 
                be 25 percent of each premium received by the group 
                health plan for the plan year in which such failure 
                occurs.
                    ``(B) Self-insured plans.--In the case that the 
                group health plan is self-insured, the cost to the plan 
                of the coverage of participants and beneficiaries shall 
                be treated as the premium received for the purposes of 
                subparagraph (A).
            ``(2) Insurer offering individual health insurance 
        coverage.--The amount of tax imposed by subsection (a)(2) on 
        any failure of an insurer with respect to an individual 
        described in paragraph (1) or (2) of section 9902(b) shall be 
        25 percent of the total amount of the premiums paid to the 
        insurer for such coverage for the plan year in which such 
        failure occurs.
    ``(c) Limitations on Amount of Tax.--
            ``(1) Tax not to apply where failure not discovered 
        exercising reasonable diligence.--No tax shall be imposed by 
        subsection (a) on any failure during any period for which it is 
        established to the satisfaction of the Secretary that none of 
        the persons referred to in subsection (e) knew, or exercising 
        reasonable diligence would have known, that such failure 
        existed.
            ``(2) Tax not to apply to failures corrected within 30 
        days.--No tax shall be imposed by subsection (a) on any failure 
        if--
                    ``(A) such failure was due to reasonable cause and 
                not to willful neglect, and
                    ``(B) such failure is corrected during the 30-day 
                period beginning on the 1st date any of the persons 
                referred to in subsection (e) knew, or exercising 
                reasonable diligence would have known, that such 
                failure existed.
            ``(3) Waiver.--In the case of a failure which is due to 
        reasonable cause and not to willful neglect, the Secretary may 
        waive part or all of the tax imposed by subsection (a) to the 
        extent that the payment of such tax would be excessive relative 
        to the failure involved.
    ``(d) Tax Not To Apply to Certain Plans.--This section shall not 
apply to--
            ``(1) any governmental plan (within the meaning of section 
        414(d)), or
            ``(2) any church plan (within the meaning of section 
        414(e)).
    ``(e) Liability for Tax.--The following shall be responsible for 
the tax imposed by subsection (a):
            ``(1) In the case of the tax imposed by subsection (a)(1) 
        on a group health plan, the plan.
            ``(2) In the case of the tax imposed by subsection (a)(2) 
        on an insurer offering health insurance coverage, the insurer.

``SEC. 9902. DEFINITIONS.

    ``(a) Definitions Relating to Managed Care.--For purposes of this 
chapter--
            ``(1) Enrollee.--The term `enrollee' means, with respect to 
        a group health plan or health insurance issuer offering health 
        insurance coverage, an individual enrolled with the plan or 
        enrolled with the issuer with respect to such coverage.
            ``(2) Managed care.--The term `managed care' means, with 
        respect to a group health plan or health insurance coverage 
        offered by a health insurance issuer, such a plan or coverage 
        that--
                    ``(A) provides or arranges for the provision of 
                health care items and services to enrollees primarily 
                through participating physicians and providers, or
                    ``(B) provides financial incentives (such as 
                variable copayments and deductibles) to induce 
                enrollees to obtain benefits primarily through 
                participating physicians and providers,
        or both.
            ``(3) Participating.--The term `participating' means, with 
        respect to a physician or provider in relation to a group 
        health plan or health insurance coverage offered by a health 
        insurance issuer, a physician or provider that furnishes health 
        care items and services to enrollees of the plan or issuer 
        under an agreement with the plan or issuer.
            ``(4) Provider network.--The term `provider network' means, 
        with respect to a plan or issuer, providers of health care 
        services provided by or through the plan or issuer who have 
        entered into an agreement with the plan or issuer or an 
        agreement with a subcontracting organization under which the 
        providers are obligated to provide such services to individuals 
        enrolled with the plan or issuer.
    ``(b) Additional Definitions.--The provisions of section 9805 apply 
for purposes of this chapter in the same manner as they apply for 
purposes of chapter 100.

                      ``Subchapter B--Requirements

                              ``Sec. 9911. Requirements relating to 
                                        managed care plans and coverage 
                                        and providers of health 
                                        services.
                              ``Sec. 9912. Grievance procedures and 
                                        deadline for responding to 
                                        requests for coverage of 
                                        services.
                              ``Sec. 9913. Requirements for service 
                                        areas; nondiscrimination.
                              ``Sec. 9914. Providing information.
                              ``Sec. 9915. Restrictions on commissions 
                                        for agents.
                              ``Sec. 9916. Protection of patient right 
                                        to know.
                              ``Sec. 9917. Patient access to clinical 
                                        studies.
                              ``Sec. 9918. Required minimum childbirth 
                                        benefits.
                              ``Sec. 9919. Assuring equitable health 
                                        plan coverage with respect to 
                                        emergency services.

``SEC. 9911. REQUIREMENTS RELATING TO MANAGED CARE PLANS AND COVERAGE 
              AND PROVIDERS OF HEALTH SERVICES.

    ``(a) Utilization Review.--
            ``(1) Meeting requirements.--
                    ``(A) In general.--A managed care group health plan 
                (or health insurance issuer that offers managed care 
                health insurance coverage) may not deny coverage of or 
                payment for items and services on the basis of a 
                utilization review program unless the Secretary of 
                Health and Human Services certifies (and periodically 
                recertifies) that the program meets the standards 
                established by such Secretary under this subsection.
                    ``(B) Certification.--The Secretary of Health and 
                Human Services may certify a managed care plan or 
                coverage as meeting such standards if the Secretary 
                determines that the plan or coverage has met the 
                utilization standards required for accreditation as 
                applied by a nationally recognized, independent, 
                nonprofit accreditation entity. Such Secretary shall 
                periodically review the standards used by the private 
                accreditation entity to ensure that such standards meet 
                or exceed the standards established by the Secretary 
                under this subsection.
            ``(2) Standards.--Such Secretary shall establish standards 
        for utilization review programs of managed care group health 
        plans and managed care health insurance coverage, consistent 
        with paragraph (3), and shall periodically review and update 
        such standards to reflect changes in the delivery of health 
        care services. Such Secretary shall establish such standards in 
        consultation with appropriate parties.
            ``(3) Description.--Under the standards established under 
        paragraph (2)--
                    ``(A) the plan or issuer offering the coverage 
                shall have a written description of the utilization 
                review program of the plan or relating to the coverage, 
                including a description of--
                            ``(i) the delegated and nondelegated 
                        activities under the program;
                            ``(ii) the policies and procedures used 
                        under the program to evaluate medical 
                        necessity; and
                            ``(iii) the clinical review criteria, 
                        information sources, and the process used to 
                        review and approve the provision of medical 
                        services under the program;
                    ``(B) with respect to the administration of the 
                utilization review program, the plan or issuer may not 
                employ utilization reviewers or contract with a 
                utilization management organization if the conditions 
                of employment or the contract terms include financial 
                incentives to reduce or limit the medically necessary 
                or appropriate services provided to covered individuals 
                and individuals performing utilization review may not 
                receive financial compensation based upon the number of 
                denials of coverage;
                    ``(C) the plan or issuer shall develop procedures 
                for periodically reviewing and modifying the 
                utilization review of the plan or relating to the 
                coverage under which providers may participate in the 
                plan or coverage in the development and review of 
                utilization review policies and procedures;
                    ``(D) utilization review--
                            ``(i) shall be conducted in accordance with 
                        uniformly applied standards that are based on 
                        the most currently available medical evidence,
                            ``(ii) shall develop and apply recorded 
                        (written or otherwise) utilization review 
                        decision protocols based on sound medical 
                        evidence;
                    ``(E) the clinical review criteria used under the 
                utilization review decision protocols to assess the 
                appropriateness of medical services shall be clearly 
                documented and available to participating health 
                professionals upon request and shall include a 
                mechanism for assessing the consistency of the 
                application of the criteria used under the protocols 
                across reviewers, and a mechanism for periodically 
                updating such criteria;
                    ``(F) the procedures applied under a utilization 
                review program with respect to the preauthorization and 
                concurrent review of the necessity and appropriateness 
                of medical items, services or procedures, shall require 
                that qualified medical professionals supervise review 
                decisions and, with respect to a decision to deny the 
                provision of medical items, services or procedures, a 
                provider licensed in the same field shall conduct a 
                subsequent review to determine the medical 
                appropriateness of such a denial and physicians from 
                the same medical branch (allopathic or osteopathic 
                medicine) and specialty (recognized by the American 
                Board of Medical Specialties or the American 
                Osteopathic Association) shall be utilized in the 
                review process as needed;
                    ``(G) negative determinations of the medical 
                necessity or appropriateness of services or the site at 
                which services are furnished may be made only by 
                clinically qualified personnel;
                    ``(H) the utilization review program shall provide 
                for a process under which an enrollee or provider may 
                obtain timely review of a denial of coverage under 
                section 9912; and
                    ``(I) the plan or issuer shall provide each covered 
                individual, at the time of enrollment and not less 
frequently than annually thereafter, an explanation of the utilization 
review requirements of the plan or under the coverage offered by the 
issuer.
    ``(b) Assurance of Access.--
            ``(1) In general.--Each managed care group health plan, and 
        each health insurance issuer offering managed care health 
        insurance coverage, shall demonstrate that the plan or issuer 
        (in relation to the coverage) has a sufficient number, 
        distribution, and variety of qualified health care providers to 
        ensure that all covered health care services will be available 
        and accessible in a timely manner to all individuals enrolled 
        under the plan or such coverage.
            ``(2) Access to specialized treatment expertise.--Such a 
        plan or issuer shall demonstrate that enrollees have access, 
        when medically or clinically indicated in the judgment of the 
        treating health professional, to specialized treatment 
        expertise.
            ``(3) Coordination of care.--
                    ``(A) In general.--Any process established by such 
                a plan or issuer to coordinate care and control costs 
                may not impose an undue burden on enrollees with 
                chronic health conditions. Such a plan or issuer shall 
                ensure a continuity of care and shall, when medically 
                or clinically indicated in the judgment of the treating 
                health professional, ensure direct access to relevant 
                specialists for continued care.
                    ``(B) Complex conditions.--In the case of an 
                enrollee who has a severe, complex, or chronic 
                condition, such a plan or issuer shall determine, based 
                on the judgment of the treating health professional, 
                whether it is medically or clinically necessary or 
                appropriate to use a care coordinator from an 
                interdisciplinary team or a specialist to ensure 
                continuity of care.
            ``(4) No waiver.--
                    ``(A) In general.--The requirements of this 
                subsection may not be waived and shall be met in all 
                areas where the plan or issuer (in relation to managed 
                care health insurance coverage) has enrollees, 
                including rural areas.
                    ``(B) Out-of-plan coverage.--If such a plan or 
                issuer fails to meet the requirements of this 
                subsection, the plan or issuer shall arrange for the 
                provision of out-of-plan or out-of-issuer services to 
                enrollees in a manner that provides enrollees with 
                access to services in accordance with this subsection.
    ``(c) Access to Centers of Excellence.--
            ``(1) In general.--Each managed care group health plan or 
        health insurance issuer offering managed care health insurance 
        coverage shall demonstrate that individuals enrolled with the 
        plan or under such coverage who have chronic diseases or 
        otherwise require specialized services have access through the 
        plan or issuer to specialized treatment expertise of designated 
        centers of excellence. Such a plan or issuer shall demonstrate 
        such access according to standards developed by the Secretary 
        of Health and Human Services, including requirements relating 
        to arrangements with such centers and referral of enrollees to 
        such centers.
            ``(2) Designation process.--Such Secretary shall establish 
        a process for the designation of facilities as centers of 
        excellence for purposes of this subsection. A facility may not 
        be designated unless the facility is determined--
                    ``(A) to provide specialty care,
                    ``(B) to deliver care for complex cases requiring 
                specialized treatment or for individuals with chronic 
                diseases, and
                    ``(C) to meet other requirements that may be 
                established by such Secretary relating to specialized 
                education and training of health professionals, 
                participation in peer-reviewed research, or treatment 
                of patients from outside the geographic area of the 
                facility.
    ``(d) Recognition of Trauma Centers.--
            ``(1) In general.--A managed care group health plan or 
        health insurance issuer offering managed care health insurance 
        coverage shall provide for health services contracted for and 
        which are provided to such an individual other than through the 
        plan or coverage (including trauma services provided by 
        designated trauma centers), if (A) the services were medically 
        necessary and immediately required because of an unforeseen 
        illness, injury, or condition and (B) it was not reasonable 
        given the circumstances to obtain the services through the plan 
        or participating providers in relation to such coverage.
            ``(2) Definition.--In paragraph (1), the term `designated 
        trauma center' has the meaning given such term in section 1231 
        of the Public Health Service Act, and includes a trauma center 
        which the Secretary finds meets the standards under section 
        1213 of such Act to be a designated trauma center but is 
located in a State that has not designated trauma centers under such 
section.
    ``(e) No Referral Required for Obstetrics and Gynecology.--A 
managed care group health plan or health insurance issuer offering 
managed care health insurance coverage may not require an individual to 
obtain a referral from a physician in order to obtain covered items and 
services from a physician who specializes in obstetrics and gynecology.
    ``(f) Coverage of Services of Essential Community Providers.--
            ``(1) In general.--The Secretary of Health and Human 
        Services may require a managed care group health plan or health 
        insurance issuer that offers managed health insurance coverage 
        to enter into agreements with essential community providers 
        serving the plan's or issuer's service area (in relation to the 
        coverage) to join the plan's or issuer's provider network if 
        such Secretary finds that such agreements are necessary for the 
        plan or issuer to make contracted for services (A) available 
        and accessible to each enrollee, within the area served by the 
        plan or issuer (in relation to such coverage), with reasonable 
        promptness and in a manner which assures continuity, and (B) 
        when medically necessary, available and accessible twenty-four 
        hours a day and seven days a week.
            ``(2) Essential community provider defined.--For purposes 
        of paragraph (1), the term `essential community provider' means 
        a rural health clinic (described in section 1861(aa)(2) of the 
        Social Security Act), a Federally qualified health center 
        (described in section 1861(aa)(4) of such Act), and any other 
        provider meeting such standards as the Secretary of Health and 
        Human Services may require.
    ``(g) Due Process Protections for Providers.--
            (1) In general.--In consultation with providers of health 
        care services who are members of the plan's or issuer's 
        provider network, each managed care group health plan and each 
        health insurance issuer offering managed care health insurance 
        coverage shall establish standards to be used by the plan or 
        issuer (in relation to such coverage) for contracting with 
        providers, and shall make descriptive information regarding 
        these standards available to enrollees, providers who are 
        members of the network, and prospective enrollees and 
        prospective members of the network.
            ``(2) Limitation on termination.--
                    ``(A) In general.--Such a group health plan or 
                health insurance issuer may not terminate or refuse to 
                renew an agreement with a provider of health care 
                services to participate in the plan's or issuer's 
                provider network unless the plan or issuer provides 
                written notification to the provider of the decision to 
                terminate or refuse to renew the agreement. The 
                notification shall include a statement of the reasons 
                for the plan's or issuer's decision, consistent with 
                the standards established under paragraph (1).
                    ``(B) Notice.--Such a plan or issuer shall provide 
                the notification required under subparagraph (A) at 
                least 45 days prior to the effective date of the 
                termination or expiration of the agreement (whichever 
                is applicable). The previous sentence shall not apply 
                if failure to terminate the agreement prior to the 
                deadline would adversely affect the health or safety of 
                an individual enrolled with the plan or issuer.
            ``(3) Review process.--
                    ``(A) In general.--Each such plan or issuer shall 
                provide a process under which a provider of health care 
                services may request a review of the plan's or issuer's 
                decision to terminate or refuse to renew the provider's 
                participation agreement. Such review shall be conducted 
                by a group of individuals the majority of whom are 
                providers of health care services who are members of 
                the plan's or issuer's provider network or employees of 
                the plan or issuer, and, to the extent possible, who 
                are members of the same profession as the provider who 
                requests the review and, for physicians, the same 
                medical branch (allopathic or osteopathic medicine).
                    ``(B) Representation.--If the provider requests in 
                advance, the plan or issuer shall permit an attorney 
                representing the provider to be present at the 
                provider's review.
                    ``(C) Advisory findings.--The findings and 
                conclusions of a review under this paragraph shall be 
                advisory and non-binding.
                    ``(D) Construction.--Nothing in this paragraph 
                shall be construed to affect any other provision of law 
                that provides an appeals process or other form of 
                relief to a provider of health care services.

``SEC. 9912. GRIEVANCE PROCEDURES AND DEADLINE FOR RESPONDING TO 
              REQUESTS FOR COVERAGE OF SERVICES.

    ``(a) Grievance Procedures.--A managed care group health plan and a 
health insurance issuer offering managed care health insurance coverage 
shall provide meaningful procedures for hearing and resolving 
grievances between the plan or issuer (any entity or individual through 
which the plan or issuer provides health care services) and members 
enrolled with the plan or issuer.
    ``(b) Details.--The procedures provided under subsection (a) shall 
include--
            ``(1) recorded (written or otherwise) procedures for 
        registering and responding to complaints and grievances in a 
        timely manner;
            ``(2) documentation concerning the substance of complaints, 
        grievances, and actions taken concerning such complaints and 
        grievances, which shall be in writing.
            ``(3) procedures to ensure a resolution of a complaint or 
        grievance;
            ``(4) the compilation and analysis of complaint and 
        grievance data;
            ``(5) procedures to expedite the complaint process if the 
        complaint involves a dispute about the coverage of an 
        immediately and urgently needed service; and
            ``(6) procedures to ensure that if an enrollee orally 
        notifies the plan or issuer about a complaint, the plan or 
        issuer (if requested) must send the enrollee a complaint form 
        that includes the telephone numbers and addresses of member 
        services, and a description of the plan's or issuer's grievance 
        procedure.
The Secretary of Health and Human Services may establish deadlines for 
the complaint procedures under paragraph (5) in order to ensure timely 
resolution of disputes involving immediately and urgently needed 
services.
    ``(c) Appeals Process.--Such a plan or issuer shall adopt an 
appeals process to enable covered individuals to appeal decisions that 
are adverse to the individuals. Such a process shall include--
            ``(1) the right to a review by a grievance panel;
            ``(2) the right to a second review with a different panel, 
        independent of the plan or issuer, or to a review through an 
        impartial arbitration process which shall be described in 
        writing by the plan or issuer; and
            ``(3) an expedited process for review in emergency cases.
The Secretary of Health and Human Services shall develop guidelines for 
the structure and requirements applicable to the independent review 
panel and impartial arbitration process described in paragraph (2).
    ``(d) Written Decision.--With respect to the complaint, grievance, 
and appeals processes required under this section, the plan or issuer 
shall, upon the request of an enrollee, provide the enrollee a written 
decision concerning a complaint, grievance, or appeal in a timely 
fashion.
    ``(e) Construction.--The complaint, grievance, and appeals 
processes established in accordance with this section may not be used 
in any fashion to discourage or prevent an enrollee from receiving 
medically necessary care in a timely manner.
    ``(f) Prompt Response to Requests for Services.--In addition to the 
procedures available pursuant to the previous provisions of this 
section, in the case of the request of an enrollee with such a plan or 
issuer--
            ``(i) the plan or issuer shall respond to the request not 
        later than 24 hours after the request is made; and
            ``(ii) the plan or issuer shall hear and resolve the 
        enrollee's appeal of a denial of coverage of such services in 
        accordance with a process meeting standards established by the 
        Secretary of Health and Human Services.

``SEC. 9913. REQUIREMENTS FOR SERVICE AREAS; NONDISCRIMINATION.

    ``(a) Service Area Requirements.--
            ``(1) In general.--Except as provided in paragraph (2), if 
        the service area of a group health plan or health insurance 
        issuer offering health insurance coverage includes any part of 
        a metropolitan statistical area, the service area shall include 
        the entire metropolitan statistical area (including any area 
        designated by the Secretary of Health and Human Services as a 
        health professional shortage area under section 332(a)(1)(A) of 
        the Public Health Service Act within such metropolitan 
        statistical area).
            ``(2) Exception.--The Secretary of Health and Human 
        Services may permit a plan's or issuer's service area to 
        exclude any portion of a metropolitan statistical area (other 
        than the central county of such metropolitan statistical area) 
        if--
                    ``(A) the plan or issuer demonstrates that it lacks 
                the financial or administrative capacity to serve the 
                entire metropolitan statistical area; and
                    ``(B) such Secretary finds that the composition of 
                the plan's or issuer's service area does not reduce the 
                financial risk to the plan or issuer of providing 
                services to enrollees because of the health status or 
                other demographic characteristics of individuals 
                residing in the service area (as compared to the health 
                status or demographic characteristics of individuals 
                residing in the portion of the metropolitan statistical 
                area not included in the plan's or issuer's service 
                area).
    ``(b) Nondiscrimination.--No group health plan and no health 
insurance issuer offering health insurance coverage may discriminate 
(directly or through contractual arrangements) in any activity, 
including the selection of a service area, that has the effect of 
discriminating against an individual on the basis of race, national 
origin, gender, language, socioeconomic status, age, disability, health 
status, or anticipated need for health services.

``SEC. 9914. PROVIDING INFORMATION.

    ``(a) Information on Physician Incentive Plans.--
            ``(1) In general.--Upon the request of an enrollee of a 
        managed care group health plan or under managed care health 
        insurance coverage offered by a health insurance issuer or an 
        individual considering enrollment with such a plan or for such 
        coverage, the plan or issuer shall provide the enrollee or 
        individual with descriptive information regarding any physician 
        incentive plan of the plan or issuer applicable to such 
        enrollment.
            ``(2) Physician incentive plan defined.--In this 
        subsection, the term `physician incentive plan' means any 
        compensation arrangement between a managed care group health 
        plan or health insurance issuer offering managed care health 
        insurance coverage and a physician or physician group that may 
        directly or indirectly have the effect of reducing or limiting 
        services provided with respect to individuals enrolled with the 
        plan or under such coverage.
    ``(b) Information on Provider Credentials.--Each managed care group 
health plan and each health insurance issuer offering managed care 
health insurance coverage shall provide each enrollee, at the time of 
enrollment and not less frequently than annually thereafter, an 
explanation of the credentials of the individuals and entities 
providing services to enrollees under the plan or coverage.
    ``(c) Other Information.--Each such plan and issuer shall provide 
prospective enrollees with written information concerning the following 
with respect to coverage offered under the plan or coverage:
            ``(1) Coverage provisions, benefits, and any exclusions by 
        category of service or product, including premiums, 
        deductibles, and copayments associated with any point-of-
        service benefits.
            ``(2) Loss ratios with an explanation that such ratios 
        reflect the percentage of the premiums expended for health 
        services.
            ``(3) Prior authorization or other review requirements 
        including preauthorization review, concurrent review, post-
        service review, post-payment review, and procedures that may 
        lead the patient to be denied coverage for, or not be provided, 
        a particular service or product.
            ``(4) Covered individual satisfaction statistics, including 
        disenrollment statistics.
            ``(5) Advance directives and organ donation.
            ``(6) The characteristics and availability of health care 
        professionals and institutions participating in the plan or 
        coverage, including descriptions of the financial arrangements 
        or contractual provisions with hospitals, utilization review 
        organizations, physicians, or any other provider of health care 
        services that would affect the services offered, referral or 
        treatment options, or physician's fiduciary responsibility to 
        patients, including financial incentives regarding the 
        provision of medical or other services.
            ``(7) Quality indicators for the plan or issuer and for 
        participating health professionals and providers under the plan 
        or coverage, including population-based statistics such as 
        immunization rates and other preventive care and health 
        outcomes measures such as survival after surgery, adjusted for 
        case mix.
            ``(8) An explanation of the appeals process and the 
        grievance procedure.
            ``(9) Salaries and other compensation for key executives of 
        the plan or issuer.
            ``(10) Physician ownership and investment structure of the 
        plan or issuer.
            ``(11) Fiscal year reports of the plan or issuer.
            ``(12) A description of lawsuits that are filed against the 
        plan or issuer, insofar as they may have a material bearing on 
        the financial circumstances of the plan or issuer or reveal 
        quality and medical coverage issues.
Information under this subsection shall be disclosed in a standard 
format, specified by the Secretary of Health and Human Services, so 
that prospective covered individuals may compare the attributes of all 
such plans and coverage offered within an area.

``SEC. 9915. RESTRICTIONS ON COMMISSIONS FOR AGENTS.

    ``In the case of a managed care group health plan or health 
insurance issuer that offers managed care health insurance coverage 
which employs or otherwise compensates agents to enroll individuals 
under the plan or coverage and which pays an agent a commission with 
respect to the enrollment of an individual--
            ``(1) such commissions may not constitute the predominant 
        source of the agent's total compensation from the plan or 
        issuer (in accordance with standards established by the 
        Secretary of Health and Human Services); and
            ``(2) if an agent receives a commission from the plan or 
        issuer with respect to an individual who enrolls with the plan 
        or under such coverage and the individual terminates enrollment 
        with the plan or such coverage during the 90-day period 
        beginning on the date of the individual's enrollment, the plan 
        or issuer shall recoup the commission from the agent.

``SEC. 9916. PROTECTION OF PATIENT RIGHT TO KNOW.

    ``(a) In General.--
            ``(1) Prohibition of certain provision.--A managed care 
        group health plan and health insurance issuer offering managed 
        care health insurance coverage may not include as part of such 
        plan or in relation to such coverage any provision that 
        prohibits, restricts, or interferes with any medical 
        communication (as defined in subsection (b)) as part of--
                    ``(A) a written contract or agreement with a health 
                care provider,
                    ``(B) a written statement to such a provider, or
                    ``(C) an oral communication to such a provider.
            ``(2) Prohibition of adverse action.--Such a plan or issuer 
        may not take any of the following actions against a health care 
        provider on the basis of a medical communication:
                    ``(A) Refusal to contract with the health care 
                provider.
                    ``(B) Termination or refusal to renew a contract 
                with the health care provider.
                    ``(C) Refusal to refer patients to or allow others 
                to refer patients to the health care provider.
                    ``(D) Refusal to compensate the health care 
                provider for covered services.
                    ``(E) Any other retaliatory action against the 
                health care provider.
            ``(3) Nullification.--Any provision that is prohibited 
        under paragraph (1) is null and void.
    ``(b) Medical Communication Defined.--For purposes of this section, 
the term `medical communication'--
            ``(1) means any communication, other than a knowing and 
        willful misrepresentation, made by the health care provider--
                    ``(A) regarding the mental or physical health care 
                needs or treatment of a patient and the provisions, 
                terms, or requirements of the managed care group health 
                plan or managed care health insurance coverage or 
                another plan or coverage relating to such needs or 
                treatment, and
                    ``(B) between--
                            ``(i) the provider and a current, former, 
                        or prospective patient (or the guardian or 
                        legal representative of a patient),
                            ``(ii) the provider and any employee or 
                        representative of the plan or issuer, or
                            ``(iii) the provider and any employee or 
                        representative of any State or Federal 
                        authority with responsibility for the licensing 
                        or oversight with respect to the plan or 
                        issuer; and
            ``(2) includes communications concerning--
                    ``(A) any tests, consultations, and treatment 
                options,
                    ``(B) any risks or benefits associated with such 
                tests, consultations, and options,
                    ``(C) variation among any health care providers and 
                any institutions providing such services in experience, 
                quality, or outcomes,
                    ``(D) the basis or standard for the decision of a 
                managed care group health plan or health insurance 
                issuer in relation to managed care health insurance 
                coverage to authorize or deny health care services or 
                benefits,
                    ``(E) the process used by the plan or issuer to 
                determine whether to authorize or deny health care 
                services or benefits, and
                    ``(F) any financial incentives or disincentives 
                provided by the plan or issuer to a health care 
                provider that are based on service utilization.
    ``(c) Non-Preemption of State Law.--A State may establish or 
enforce requirements with respect to the subject matter of this 
section, but only if such requirements are more protective of medical 
communications than the requirements established under this section.
    ``(d) Construction.--Nothing in this section shall be construed 
as--
            ``(1) requiring a managed care group health plan or health 
        insurance issuer in relation to managed care health insurance 
        coverage to enter into or renew a contract or agreement with 
        any willing health care provider, or
            ``(2) preventing such a plan or issuer from acting on 
        information relating to treatment actually provided to a 
        patient or the failure of a health care provider to comply with 
        legal standards relating to the provision of care.

``SEC. 9917. PATIENT ACCESS TO CLINICAL STUDIES.

    ``(a) Permitting Participation in Approved Clinical Studies.--A 
managed care group health plan and a health insurance issuer offering 
managed care health insurance coverage health plan may not deny (or 
limit or impose additional conditions on) coverage of items and 
services furnished to an enrollee if--
            ``(1) the enrollee is participating in an approved clinical 
        study,
            ``(2) the items and services are furnished according to the 
        design of the study or to treat conditions resulting from 
        participation in the study, and
            ``(3) the items and services would otherwise be covered 
        under the plan or coverage except for the fact that they are 
        provided in connection with participation in such a study.
Such a plan or issuer may not discriminate against an enrollee on the 
basis of the enrollee's participation in such a study.
    ``(b) Construction.--Nothing in subsection (a) shall be construed 
as requiring a plan or issuer to provide for payment for items and 
services routinely paid for as part of an approved clinical study.
    ``(c) Approved Clinical Study Defined.--For purposes of this 
section, the term `approved clinical study' means--
            ``(1) a research study approved by the Secretary of Health 
        and Human Services, the Director of the National Institutes of 
        Health, the Commissioner of the Food and Drug Administration, 
        the Secretary of Veterans Affairs, the Secretary of Defense, or 
        a qualified nongovernmental research entity (as defined in 
        guidelines of the National Institute of Health), or
            ``(2) a peer-reviewed and approved research program, as 
        defined by the Secretary of Health and Human Services, 
        conducted for the primary purpose of determining whether or not 
        a treatment is safe, efficacious, or having any other 
        characteristic of a treatment which must be demonstrated in 
        order for the treatment to be medically necessary or 
        appropriate.

``SEC. 9918. REQUIRED MINIMUM CHILDBIRTH BENEFITS.

    ``(a) Minimum Childbirth Benefits.--If a managed care group health 
plan or managed care health insurance coverage offered by a health 
insurance issuer provides coverage that includes any benefits for 
inpatient care for childbirth for a mother or newborn child, the plan 
or issuer (in relation to such coverage) shall meet the following 
requirements:
            ``(1) Minimum length of stay for inpatient care benefits.--
        The plan or coverage shall provide benefits for inpatient care 
        for childbirth for a minimum length of stay of 48 hours 
        following a vaginal delivery and a minimum length of stay of 96 
        hours following a caesarean section.
            ``(2) Coverage of post-delivery follow-up care.--If an 
        attending provider, in consultation with the mother, decides to 
        discharge a covered mother or newborn child from an inpatient 
        setting before the expiration of the minimum length of stay 
        period described in paragraph (1), the plan or coverage shall 
        include benefits for timely post-delivery care by a registered 
        nurse, physician, nurse practitioner, nurse midwife or 
        physician assistant experienced in maternal and child health in 
        the home, a provider's office, a hospital, a federally 
        qualified health center, a federally qualified rural health 
        clinic, a State health department maternity clinic, or another 
        setting (such as a birthing center or an intermediate care 
        facility) determined appropriate under regulations promulgated 
        by the Secretary of Health and Human Services.
            ``(3) Notice.--The plan or issuer shall provide notice to 
        each enrollee eligible for childbirth benefits under this 
        subsection regarding the requirements of this section.
    (b) Prohibitions.--In implementing the requirements of subsection 
(a), such a plan or issuer may not--
            ``(1) require or condition the provision of benefits under 
        subsection (a) on any authorization or approval of an attending 
        or other provider;
            ``(2) deny enrollment, renewal, or continued coverage to a 
        mother and her newborn child who are otherwise eligible to be 
        so covered based on compliance with this section;
            ``(3) provide monetary incentives to mothers to encourage 
        such mothers to request less than the minimum coverage required 
        under subsection (a);
            ``(4) provide incentives (monetary or otherwise) to an 
        attending provider to induce such provider to provide treatment 
        in a manner inconsistent with this section; or
            ``(5) penalize or otherwise reduce or limit the 
        reimbursement of an attending provider because such provider 
        provided treatment in accordance with this section.
    ``(c) Additional Terms and Conditions.--
            ``(1) Attending provider.--As used in this section, the 
        term `attending provider' means, with respect to a mother and 
        her newborn child, an obstetrician-gynecologist, pediatrician, 
        family physician, or other physician, or any other health care 
        provider (such as a nurse midwife or nurse practitioner), who, 
        acting in accordance with applicable State law, is primarily 
        responsible for the care of the mother and child.
            (2) Timely care defined.--As used in subsection (a)(2), the 
        term `timely post-delivery care' means health care that is 
        provided--
                    ``(A) following the discharge of a mother and her 
                newborn child from the inpatient setting following 
                childbirth; and
                    ``(B) in a manner that meets the health care needs 
                of the mother and her newborn child, that provides for 
                the appropriate monitoring of the conditions of the 
                mother and child, and that occurs within the 72-hour 
                period immediately following discharge.
            ``(3) Regulations regarding appropriate post-care delivery 
        settings.--The Secretary of Health and Human Services, with 
        respect to regulations promulgated under subsection (a)(2) 
        concerning appropriate post-delivery care settings--
                    ``(A) shall ensure that, to the extent practicable, 
                such regulations are consistent with State licensing 
                and practice laws,
                    ``(B) shall consider telemedicine and other 
                innovative means to provide follow-up care, and
                    ``(C) shall consider both urban and rural settings.
            ``(4) Rule of construction.--Nothing in this section shall 
        be construed to require that a mother--
                    ``(A) give birth in a hospital; or
                    ``(B) stay in the hospital for a fixed period of 
                time following the birth of her child.
            ``(5) Requirements.--The notice required under subsection 
        (a)(3) shall be in accordance with regulations promulgated by 
        the Secretary of Health and Human Services. Such regulations 
        shall provide that the notice shall be in writing, shall be 
        conspicuous and prominently positioned, and shall be required 
        to be provided as follows:
                    ``(A) Health insurance coverage.--By a health 
                insurance issuer in relation to managed care health 
                insurance coverage--
                            ``(i) to enrollees described in subsection 
                        (a) who are enrolled on the effective date of 
                        this chapter within 120 days after such 
                        effective date and annually thereafter, and
                            ``(ii) to other enrollees at the time of 
                        enrollment and annually thereafter.
                    ``(B) Group health plans.--By a managed care group 
                health plan--
                            ``(i) to enrollees described in subsection 
                        (a) who are enrolled on the effective date of 
                        this chapter within 120 days after such 
                        effective date, and
                            ``(ii) for plan years beginning on or after 
                        such effective date, as part of its summary 
                        plan description.

``SEC. 9919. ASSURING EQUITABLE HEALTH PLAN COVERAGE WITH RESPECT TO 
              EMERGENCY SERVICES.

    ``(a) Prohibition of Contractual Limitations on Coverage of 
Emergency Services.--A managed care group health plan or managed care 
health insurance coverage offered by a health insurance issuer that 
provides any coverage with respect to emergency services shall cover 
emergency services furnished to an enrollee of the plan or issuer (with 
respect to such managed care coverage)--
            ``(1) without regard to whether or not the provider 
        furnishing the emergency services has a contractual or other 
        arrangement with the plan or issuer for the provision of such 
        services to such enrollees, and
            ``(2) without regard to prior authorization.
    ``(b) Prohibition of Discriminatory Payment or Cost-Sharing.--
            ``(1) In general.--Such a plan or issuer that provides any 
        coverage with respect to emergency services--
                    ``(A) shall determine and make prompt payment in a 
                reasonable and appropriate amount for such services, 
                and
                    ``(B) subject to paragraph (2), may not impose 
                cost-sharing for services furnished in a hospital 
                emergency department that is calculated in a manner 
                (such as the use of a different percentage) that 
                imposes greater cost sharing with respect to such 
                services compared to comparable services furnished in 
                other settings.
            ``(2) Imposition of reasonable copayment permitted.--Such a 
        plan or issuer may impose a reasonable copayment (as determined 
        in accordance with standards established by the Secretary of 
        Health and Human Services) in lieu of coinsurance to deter 
        inappropriate use of services of hospital emergency 
        departments.
    ``(c) Assuring Timeliness of Prior Authorization Determination for 
Needed Care Identified in Initial Evaluation.--
            ``(1) In general.--
                    ``(A) Access to process.--If an enrollee of a 
                managed care group health plan or health insurance 
                issuer in relation to managed care health insurance 
                coverage receives emergency services from an emergency 
                department pursuant to a screening evaluation conducted 
                by a treating physician or other emergency department 
                personnel and pursuant to the evaluation such physician 
                or personnel identifies items and services (other than 
                emergency services) promptly needed by the enrollee, 
                the plan or issuer shall provide access 24 hours a day, 
                7 days a week, to such persons as may be authorized to 
                make any prior authorization determinations respecting 
                coverage of such promptly needed items and services.
                    ``(B) Deemed approval.--Such a plan or issuer is 
                deemed to have approved a request for a prior 
                authorization for such promptly needed items and 
                services if such physician or other personnel--
                            ``(i) has attempted to contact such a 
                        person for authorization--
                                    ``(I) to provide an appropriate 
                                referral for the items and services, or
                                    ``(II) to provide the items and 
                                services to the enrollee,
                        and access to the person has not been provided 
                        (as required under subparagraph (A)), or
                            ``(ii) has requested such authorization 
                        from such a person and the person has not 
                        denied the authorization within 30 minutes 
                        after the time the request is made.
            ``(2) Referral by physician to hospital emergency 
        department deemed prior authorization.--If a participating 
        physician or other person authorized to make prior 
        authorization determinations for such a plan or issuer refers 
        an enrollee to a hospital emergency department for evaluation 
        or treatment, a request for prior authorization of the items 
        and services reasonably furnished the enrollee pursuant to such 
        referral shall be deemed to have been made and approved.
            ``(3) Effect of approval.--
                    ``(A) In general.--Approval of a request for a 
                prior authorization determination (including a deemed 
                approval under paragraph (1) or (2)) shall be treated 
                as approval of any health care items and services 
                required to treat the medical condition identified 
                pursuant to a screening evaluation referred to in 
                paragraph (1)(A).
                    ``(B) Payment.--Such a plan or issuer may not 
                subsequently deny or reduce payment for an item or 
                service furnished pursuant to such an approval unless 
                the approval was based on information about the medical 
                condition of an enrollee that was fraudulent.
    ``(d) Encouraging Appropriate Use of 911 Emergency Telephone 
Number.--Such a plan or issuer--
            ``(1) shall include, in any educational materials the plan 
        makes available to its enrollees on the procedures for 
        obtaining emergency services--
                    ``(A) a statement that it is appropriate for an 
                enrollee to use the 911 emergency telephone number for 
                an emergency medical condition (as defined in 
                subsection (f)(3)), and
                    ``(B) an explanation of what is an emergency 
                medical condition;
            ``(2) shall not discourage appropriate use of the 911 
        emergency telephone number by enrollees with emergency medical 
        conditions; and
            ``(3) shall not deny coverage or payment for an item or 
        service solely on the basis that an enrollee uses the 911 
        emergency telephone number to summon treatment for an emergency 
        medical condition.
    ``(e) Effect on State Law.--
            ``(1) Preemption.--Nothing in this section shall be 
        construed as preempting or otherwise superseding any provision 
        of State law unless such provision directly conflicts with this 
        section.
            ``(2) Consumer protections.--A provision of State law shall 
        not be considered to conflict directly with this section if the 
        provision provides the enrollees with protections that exceed 
        the protections of this section.
    ``(f) Definitions.--For purposes of this section:
            ``(1) Cost-sharing.--The term `cost-sharing' means any 
        deductible, coinsurance amount, copayment, or other out-of-
        pocket payment that an enrollee is responsible for paying with 
        respect to a health care item or service covered under a 
        managed care group health plan or managed care health insurance 
        coverage.
            ``(2) Emergency department.--The term `emergency 
        department' includes, with respect to a hospital, a trauma 
        center in the hospital if the center--
                    ``(A) is designated under section 1213 of the 
                Public Health Service Act, or
                    ``(B) is in a State that has not made such 
                designations and is determined by the Secretary to meet 
                the standards under such section for such designation.
            ``(3) Emergency medical condition.--The term `emergency 
        medical condition' means a medical condition, the onset of 
        which or change in which is sudden, that manifests itself by 
        symptoms of sufficient severity, including severe pain, that a 
        prudent layperson, who possesses an average knowledge of health 
        and medicine, could reasonably expect the absence of immediate 
        medical attention to result in--
                    ``(A) placing the person's health in serious 
                jeopardy,
                    ``(B) serious impairment to bodily functions, or
                    ``(C) serious dysfunction of any bodily organ or 
                part.
            ``(4) Emergency services.--The term `emergency services' 
        means--
                    ``(A) health care items and services furnished in 
                the emergency department of a hospital, and
                    ``(B) ancillary services routinely available to 
                such department,
        to the extent they are required to evaluate and treat an 
        emergency medical condition (as defined in paragraph (3)) until 
        the condition is stabilized.
            ``(5) Prior authorization determination.--The term `prior 
        authorization determination' means, with respect to health care 
        items and services for which coverage may be provided under a 
        group health plan or health insurance coverage, a 
        determination, before the provision of the items and services 
        and as a condition of coverage of the items and services under 
        the plan or coverage, that coverage will be provided for the 
        items and services under the plan or coverage.
            ``(6) Stabilized.--The term `stabilized' means, with 
        respect to an emergency medical condition, that no material 
        deterioration of the condition is likely, within reasonable 
        medical probability, to result or occur before an individual 
        can be transferred in compliance with the requirements of 
        section 1867 of the Social Security Act.
            ``(7) 911 emergency telephone number.--The term `911 
        emergency telephone number' includes, in the case of a 
        geographic area where 911 is not in use for emergencies, such 
        other telephone number as is in use for emergencies.''
    (b) Clerical Amendment.--The table of contents for the Internal 
Revenue Code of 1986 is amended by adding after the item relating to 
subtitle K the following new item:
                              ``Subtitle L. Protection for 
                                        Beneficiaries Under Managed 
                                        Care Plans.''
    (c) Effective Date.--The requirement of section 9902 of the 
Internal Revenue Code of 1986 (as added by subsection (a) of this 
section) shall take effect on January 1, 1998, and shall apply to 
coverage offered on or after such date regardless of whether the plan 
year began before such date.

                       Subtitle C--Effective Date

SEC. 121. EFFECTIVE DATE.

    The amendments made by this title shall apply with respect to 
contract years beginning on or after January 1, 1998.

                           TITLE II--MEDICARE

SEC. 201. PROHIBITION ON PAYMENTS UNDER MEDICARE UNTIL COMPLETION OF 
              ORIENTATION AND MEDICAL PROFILE.

    (a) In General.--Section 1876(c)(3) of the Social Security Act (42 
U.S.C. 1395mm(c)(3)) is amended by adding at the end the following:
    ``(G)(i) The Secretary may not make a payment to an eligible 
organization under a risk-sharing contract under this section with 
respect to an enrollee until the eligible organization certifies to the 
Secretary that the organization--
            ``(I) has provided the enrollee an orientation as described 
        in clause (ii), and
            ``(II) has a medical profile described in clause (iii) with 
        respect to the enrollee.
    ``(ii) The orientation required under this subparagraph includes an 
explanation of the following features of the health plan offered by 
such organization:
            ``(I) Access to care, including choice of physician, 
        physician location, and hospital coverage.
            ``(II) The information required under section 9914 of the 
        Internal Revenue Code of 1986.
    ``(iii) The medical profile described in this clause is such 
profile of the medical condition of the enrollee as the Secretary shall 
specify by regulation.''.
    (b) Promulgation of Requirements for Orientation and Medical 
Profile.--Not later that 180 days after the date of the enactment of 
this Act, the Secretary of Health and Human Services shall, by rule, 
first specify the elements of the orientation and of the medical 
profile described in clauses (ii) and (iii) of section 1876(c)(3)(G) of 
the Social Security Act (as added by subsection (a)). Chapter 8 of 
title 5, United States Code, shall not apply to such rule. Such rule 
shall apply on a final basis, pending notice and opportunity for public 
comment.
    (c) Effective Date.--The amendment made by subsection (a) applies 
with respect to enrollees as of the first day of the first month that 
begins more than 60 days after the date on which the Secretary first 
publishes the rule under subsection (b) in the Federal Register.

SEC. 202. CHANGES IN REQUIREMENTS FOR MEDICARE SUPPLEMENTAL POLICIES 
              RELATING TO COMMUNITY RATING AND LOSS RATIOS.

    (a) Requirement of Community Rating.--
            (1) In general.--Section 1882(s) of the Social Security Act 
        (42 U.S.C. 1395ss(s)) is amended--
                    (A) in paragraph (3), by striking ``paragraphs (1) 
                and (2)'' and inserting ``this subsection'', and by 
                redesignating such paragraph as paragraph (4), and
                    (B) by inserting after paragraph (2) the following 
                new paragraph:
    ``(3)(A) Except as provided in this paragraph, the issuer of a 
Medicare supplemental policy may not vary the premium among individuals 
who reside in the same community rating area.
    ``(B)(i) In the first year for which this paragraph applies to such 
an issuer in a State, the premium rate charged by the issuer for such a 
policy in a community may vary so long as the premium range percentage 
(as defined in clause (iii)) does not exceed \2/3\ of the premium range 
percentage of premium rates charged by the insurer for such policies in 
the community rating area in the previous year.
    ``(ii) In the second year for which this paragraph applies to such 
an issuer in a State, the premium rate charged by the issuer for such a 
policy in a community may vary so long as the premium range percentage 
(as defined in clause (iii)) does not exceed \1/2\ of the maximum 
premium range percentage permitted under clause (i) for the previous 
year.
    ``(iii) In this paragraph, the term `premium range percentage' 
means--
            ``(I) the highest premium rate minus the lowest premium 
        rate, divided by
            ``(II) the lowest premium rate,
expressed as a percentage.
    ``(C) For purposes of this paragraph, each of the following is 
considered to be a separate `community rating area':
            ``(1) Each metropolitan statistical area.
            ``(2) The area of each State that is not within a 
        metropolitan statistical area.
            (2) Conforming amendment.--Section 1882(s)(2)(A) of such 
        Act (42 U.S.C. 1395ss(s)(2)(A)) is amended by striking ``, or 
        discriminate in the pricing of the policy,''.
    (b) Increase in Loss Ratio.--Section 1882(r)(1)(A) of such Act (42 
U.S.C. 1395ss(r)(1)(A)) is amended by striking ``75 percent'' and all 
that follows through the semicolon and inserting ``85 percent;''.
    (c) Effective Date.--
            (1) NAIC standards.--If, within 6 months after the date of 
        the enactment of this Act, the National Association of 
        Insurance Commissioners (in this section referred to as the 
        ``NAIC'') makes changes in the 1991 NAIC Model Regulation (as 
defined in section 1882(p)(1)(A) of the Social Security Act) to 
incorporate the additional requirements imposed by the amendments made 
by this section, section 1882(g)(2)(A) of such Act shall be applied in 
each State, effective for policies issued to policyholders on and after 
the date specified in paragraph (3), as if the reference to the Model 
Regulation adopted on June 6, 1979, were a reference to the 1991 NAIC 
Model Regulation (as so defined) as changed under this section (such 
changed Regulation referred to in this section as the ``1996 NAIC Model 
Regulation'').
            (2) Secretary standards.--If the NAIC does not make changes 
        in the 1991 NAIC Model Regulation (as so defined) within the 6-
        month period specified in paragraph (1), the Secretary of 
        Health and Human Services (in this subsection as the 
        ``Secretary'') shall promulgate a regulation and section 
        1882(g)(2)(A) of the Social Security Act shall be applied in 
        each State, effective for policies issued to policyholders on 
        and after the date specified in paragraph (3), as if the 
        reference to the Model Regulation adopted in June 6, 1979, were 
        a reference to the 1991 NAIC Model Regulation (as so defined) 
        as changed by the Secretary under this subsection (such changed 
        Regulation referred to in this subsection as the ``1996 Federal 
        Regulation'').
            (3) Date specified.--
                    (A) In general.--Subject to subparagraph (B), the 
                date specified in this paragraph for a State is the 
                earlier of--
                            (i) the date the State adopts the 1996 NAIC 
                        Model Regulation or the 1996 Federal 
                        Regulation; or
                            (ii) 1 year after the date the NAIC or the 
                        Secretary first adopts such regulations.
                    (B) Additional legislative action required.--In the 
                case of a State which the Secretary identifies, in 
                consultation with the NAIC, as--
                            (i) requiring State legislation (other than 
                        legislation appropriating funds) in order for 
                        medicare supplemental policies to meet the 1996 
                        NAIC Model Regulation or the 1996 Federal 
                        Regulation, but
                            (ii) having a legislature which is not 
                        scheduled to meet in 1997 in a legislative 
                        session in which such legislation may be 
                        considered,
                the date specified in this paragraph is the first day 
                of the first calendar quarter beginning after the close 
                of the first legislative session of the State 
                legislature that begins on or after January 1, 1997. 
                For purposes of the previous sentence, in the case of a 
                State that has a 2-year legislative session, each year 
                of such session shall be deemed to be a separate 
                regular session of the State legislature.

SEC. 203. OTHER ADDITIONAL CONSUMER PROTECTIONS FOR MEDICARE 
              SUPPLEMENTAL INSURANCE.

    (a) Guaranteeing Issue Without Preexisting Conditions for 
Continuously Covered Individuals.--Section 1882(s) of the Social 
Security Act (42 U.S.C. 1395ss(s)), as amended by section 202(a), is 
amended--
            (1) by redesignating paragraph (4) as paragraph (5), and
            (2) by inserting after paragraph (3) the following new 
        paragraph:
    ``(4)(A) The issuer of a Medicare supplemental policy--
            ``(i) may not deny or condition the issuance or 
        effectiveness of a Medicare supplemental policy described in 
        subparagraph (C);
            ``(ii) may not discriminate in the pricing of the policy on 
        the basis of the individual's health status, medical condition 
        (including both physical and mental illnesses), claims 
        experience, receipt of health care, medical history, genetic 
        information, evidence of insurability (including conditions 
        arising out of acts of domestic violence), or disability; and
            ``(iii) may not impose an exclusion of benefits based on a 
        pre-existing condition,
in the case of an individual described in subparagraph (B) who seeks to 
enroll under the policy not later than 63 days after the date of the 
termination of enrollment described in such subparagraph.
    ``(B) An individual described in this subparagraph is an individual 
described in any of the following clauses:
            ``(i) The individual is enrolled with an eligible 
        organization under a contract under section 1876 or with an 
        organization under an agreement under section 1833(a)(1)(A) and 
        such enrollment ceases either because the individual moves 
        outside the service area of the organization under the contract 
        or agreement or because of the termination or nonrenewal of the 
        contract or agreement.
            ``(ii) The individual is enrolled with an organization 
        under a policy described in subsection (t) and such enrollment 
ceases either because the individual moves outside the service area of 
the organization under the policy, because of the bankruptcy or 
insolvency of the insurer, or because the insurer closes the block of 
business to new enrollment.
            ``(iii) The individual is covered under a Medicare 
        supplemental policy and such coverage is terminated because of 
        the bankruptcy or insolvency of the insurer issuing the policy, 
        because the insurer closes the block of business to new 
        enrollment, or because the individual changes residence so that 
        the individual no longer resides in a State in which the issuer 
        of the policy is licensed.
            ``(iv) The individual is enrolled under an employee welfare 
        benefit plan that provides health benefits that supplement the 
        benefits under this title and the plan terminates or ceases to 
        provide (or significantly reduces) such supplemental health 
        benefits to the individual.
            ``(v)(I) The individual is enrolled with an eligible 
        organization under a contract under section 1876 or with an 
        organization under an agreement under section 1833(a)(1)(A) and 
        such enrollment is terminated by the enrollee during the first 
        12 months of such enrollment, but only if the individual never 
        was previously enrolled with an eligible organization under a 
        contract under section 1876 or with an organization under an 
        agreement under section 1833(a)(1)(A).
            ``(II) The individual is enrolled under a policy described 
        in subsection (t) and such enrollment is terminated during the 
        first 12 months of such enrollment, but only if the individual 
        never was previously enrolled under such a policy under such 
        subsection.
    ``(C)(i) Subject to clause (ii), a Medicare supplemental policy 
described in this subparagraph, with respect to an individual described 
in subparagraph (B), is a policy the benefits under which are 
comparable or lesser in relation to the benefits under the enrollment 
described in subparagraph (B) (or, in the case of an individual 
described in clause (ii), under the most recent Medicare supplemental 
policy described in clause (ii)(II)).
    ``(ii) An individual described in this clause is an individual 
who--
            ``(I) is described in subparagraph (B)(v), and
            ``(II) was enrolled in a Medicare supplemental policy 
        within the 63 day period before the enrollment described in 
        such subparagraph.
    ``(iii) As a condition for approval of a State regulatory program 
under subsection (b)(1) and for purposes of applying clause (i) to 
policies to be issued in the State, the regulatory program shall 
provide for the method of determining whether policy benefits are 
comparable or lesser in relation to other benefits. With respect to a 
State without such an approved program, the Secretary shall establish 
such method.
    ``(D) At the time of an event described in subparagraph (B) because 
of which an individual ceases enrollment or loses coverage or benefits 
under a contract or agreement, policy, or plan, the organization that 
offers the contract or agreement, the insurer offering the policy, or 
the administrator of the plan, respectively, shall notify the 
individual of the rights of the individual, and obligations of issuers 
of Medicare supplemental policies, under subparagraph (A).''.
    (b) Limitation on Imposition of Preexisting Condition Exclusion 
During Initial Open Enrollment Period.--Section 1882(s)(2)(B) of such 
Act (42 U.S.C. 1395ss(s)(2)(B)) is amended to read as follows:
    ``(B) In the case of a policy issued during the 6-month period 
described in subparagraph (A), the policy may not exclude benefits 
based on a pre-existing condition.''.
    (c) Clarifying the Nondiscrimination Requirements During the 6-
Month Initial Enrollment Period.--Section 1882(s)(2)(A) of such Act (42 
U.S.C. 1395ss(s)(2)(A)) is amended to read as follows:
    ``(2)(A)(i) In the case of an individual described in clause (ii), 
the issuer of a Medicare supplemental policy--
            ``(I) may not deny or condition the issuance or 
        effectiveness of a Medicare supplemental policy, and
            ``(II) may not discriminate in the pricing of the policy on 
        the basis of the individual's health status, medical condition 
        (including both physical and mental illnesses), claims 
        experience, receipt of health care, medical history, genetic 
        information, evidence of insurability (including conditions 
        arising out of acts of domestic violence), or disability.
    ``(ii) An individual described in this clause is an individual for 
whom an application is submitted before the end of the 6-month period 
beginning with the first month as of the first day on which the 
individual is 65 years of age or older and is enrolled for benefits 
under part B.''.
    (d) Extending 6-Month Initial Enrollment Period to Non-Elderly 
Medicare Beneficiaries.--Section 1882(s)(2)(A)(ii) of such Act (42 
U.S.C. 1395ss(s)(2)(A)), as amended by subsection (c), is amended by 
striking ``is submitted'' and all that follows and inserting the 
following: ``is submitted--
            ``(I) before the end of the 6-month period beginning with 
        the first month as of the first day on which the individual is 
        65 years of age or older and is enrolled for benefits under 
        part B; and
            ``(II) for each time the individual becomes eligible for 
        benefits under part A pursuant to section 226(b) or 226A and is 
        enrolled for benefits under part B, before the end of the 6-
        month period beginning with the first month as of the first day 
        on which the individual is so eligible and so enrolled.''.
    (e) Effective Dates.--
            (1) Guaranteed issue.--The amendment made by subsection (a) 
        shall take effect on July 1, 1997.
            (2) Limit on preexisting condition exclusions.--The 
        amendment made by subsection (b) shall apply to policies issued 
        on or after July 1, 1997.
            (3) Clarification of nondiscrimination requirements.--The 
        amendment made by subsection (c) shall apply to policies issued 
        on or after July 1, 1997.
            (4) Extension of enrollment period to disabled 
        individuals.--
                    (A) In general.--The amendment made by subsection 
                (d) shall take effect on July 1, 1997.
                    (B) Transition rule.--In the case of an individual 
                who first became eligible for benefits under part A of 
                title XVIII of the Social Security Act pursuant to 
                section 226(b) or 226A of such Act and enrolled for 
                benefits under part B of such title before July 1, 
                1997, the 6-month period described in section 
                1882(s)(2)(A) of such Act shall begin on July 1, 1997. 
                Before July 1, 1997, the Secretary of Health and Human 
                Services shall notify any individual described in the 
                previous sentence of their rights in connection with 
                Medicare supplemental policies under section 1882 of 
                such Act, by reason of the amendment made by subsection 
                (d).
    (f) Transition Provisions.--
            (1) In general.--If the Secretary of Health and Human 
        Services identifies a State as requiring a change to its 
        statutes or regulations to conform its regulatory program to 
        the changes made by this section, the State regulatory program 
        shall not be considered to be out of compliance with the 
        requirements of section 1882 of the Social Security Act due 
        solely to failure to make such change until the date specified 
        in paragraph (4).
            (2) NAIC standards.--If, within 9 months after the date of 
        the enactment of this Act, the National Association of 
        Insurance Commissioners (in this subsection referred to as the 
        ``NAIC'') modifies its NAIC Model Regulation relating to 
        section 1882 of the Social Security Act (referred to in such 
        section as the 1991 NAIC Model Regulation, as modified pursuant 
        to section 171(m)(2) of the Social Security Act Amendments of 
        1994 (Public Law 103-432) and as modified pursuant to section 
        1882(d)(3)(A)(vi)(IV) of the Social Security Act, as added by 
        section 271(a) of the Health Care Portability and 
        Accountability Act of 1996 (Public Law 104-191) to conform to 
        the amendments made by this section, such revised regulation 
        incorporating the modifications shall be considered to be the 
        applicable NAIC model regulation (including the revised NAIC 
        model regulation and the 1991 NAIC Model Regulation) for the 
        purposes of such section.
            (3) Secretary standards.--If the NAIC does not make the 
        modifications described in paragraph (2) within the period 
        specified in such paragraph, the Secretary of Health and Human 
        Services shall make the modifications described in such 
        paragraph and such revised regulation incorporating the 
        modifications shall be considered to be the appropriate 
        Regulation for the purposes of such section.
            (4) Date specified.--
                    (A) In general.--Subject to subparagraph (B), the 
                date specified in this paragraph for a State is the 
                earlier of--
                            (i) the date the State changes its statutes 
                        or regulations to conform its regulatory 
                        program to the changes made by this section, or
                            (ii) 1 year after the date the NAIC or the 
                        Secretary first makes the modifications under 
                        paragraph (2) or (3), respectively.
                    (B) Additional legislative action required.--In the 
                case of a State which the Secretary identifies as--
                            (i) requiring State legislation (other than 
                        legislation appropriating funds) to conform its 
                        regulatory program to the changes made in this 
                        section, but
                            (ii) having a legislature which is not 
                        scheduled to meet in 1998 in a legislative 
                        session in which such legislation may be 
                        considered,
                the date specified in this paragraph is the first day 
                of the first calendar quarter beginning after the close 
                of the first legislative session of the State 
                legislature that begins on or after July 1, 1998. For 
                purposes of the previous sentence, in the case of a 
                State that has a 2-year legislative session, each year 
                of such session shall be deemed to be a separate 
                regular session of the State legislature.

SEC. 204. APPLICATION OF STANDARDS TO MEDICARE SELECT POLICIES.

    Section 1882(t) of the Social Security Act (42 U.S.C. 1395ss(t)) is 
amended--
            (1) in the matter in paragraph (1) before subparagraph (A), 
        by inserting ``, under the standards established under 
        paragraph (4)'' after ``if'';
            (2) by striking ``and'' at the end of paragraph (1)(E);
            (3) by striking the period at the end of paragraph (1)(F) 
        and inserting a semicolon;
            (4) by adding at the end of paragraph (1) the following new 
        subparagraphs:
                    ``(G) notwithstanding any other provision of this 
                section to the contrary, if the issuer of the policy 
                meet the requirements of paragraph (5).'';
            (5) by adding at the end of paragraph (2) the following: 
        ``The intermediate sanctions described in clauses (ii) and 
        (iii) of section 1876(i)(6)(B) shall apply to actions described 
        in the first sentence of this paragraph in the same manner as 
        they apply to violations described in section 1876(i)(6)(A).''; 
        and
            (6) by adding at the end the following new paragraphs:
    ``(4)(A) The Secretary shall establish by regulation standards for 
policies in order to be provided special treatment under paragraph (1). 
To the extent practicable, such standards shall be the same as the 
standards established by the National Association of Insurance 
Commissioners with respect to such policies. Any additional standards 
shall be developed in consultation with such Association.
    ``(B) If the Secretary determines that a State has established an 
effective program to enforce the standards established under 
subparagraph (A), any policy that a State determines under such program 
to meet such standards shall be deemed to meet such standards for 
purposes of this section.
    ``(5) For purposes of paragraph (1), the requirements of this 
paragraph, with respect to a policy are as follows:
            ``(A) If the issuer of the policy--
                    ``(i) is an eligible organization (as defined in 
                section 1876(a)), the benefits under the policy (in 
                coordination with benefits made available under this 
                title) are the same as the benefits required to be made 
                available by such an organization with a risk-sharing 
                contract under section 1876, or
                    ``(ii) is not such an organization, the benefits 
                under the policy shall be either--
                            ``(I) the benefits required under the 
                        Standardized Medicare supplement benefit plan 
                        `E' (as specified in section 9E(5) of the 1991 
                        NAIC Model Regulation), plus One Hundred 
                        Percent (100%) of the Medicare Part B Excess 
                        Charges (as defined in section 8C(5) of such 
                        Regulation); or
                            ``(II) the benefits required under the 
                        Standardized Medicare supplement benefit plan 
                        `J' (as specified in section 9E(10) of such 
                        Regulation).
            ``(B) The issuer of the policy (in relation to the policy) 
        meets the same requirements under section 1876 that would apply 
        to an eligible organization with a risk-sharing contract under 
        that section (including community rating of premiums and prior 
        approval of marketing materials, but not including provision of 
        benefits).''.

SEC. 205. ARRANGEMENTS FOR OUT-OF-AREA DIALYSIS SERVICES.

    Section 1876(c) of the Social Security Act (42 U.S.C. 1395mm(c)) is 
amended by adding at the end the following new paragraph:
    ``(9) Each eligible organization shall assure that enrollees 
requiring renal dialysis services who are temporarily outside of the 
organization's service area (within the United States) have reasonable 
access to such services by--
            ``(A) making such arrangements with providers of services 
        or renal dialysis facilities outside the service area for the 
        coverage of and payment for such services furnished to 
        enrollees as the Secretary determines necessary to assure 
        reasonable access; or
            ``(B) providing for the reimbursement of any provider of 
        services or renal dialysis facility outside the service area 
        for the furnishing of such services to enrollees.''.

SEC. 206. COORDINATION OF MEDICARE ENROLLMENT.

    (a) Uniform Open Enrollment Periods.--
            (1) For medigap plans.--Section 1882(s) of such Act (42 
        U.S.C. 1395ss(s)), as amended by sections 202(a) and 203(a), is 
        amended--
                    (A) by redesignating paragraph (5) as paragraph 
                (6), and
                    (B) by inserting after paragraph (4) the following 
                new paragraph:
    ``(5) Each issuer of a Medicare supplemental policy shall have an 
open enrollment period (which shall be the period specified by the 
Secretary under section 1876(c)(3)(A)(i)), of at least 30 days duration 
every year, during which the issuer may not deny or condition the 
issuance or effectiveness of a Medicare supplemental policy, or 
discriminate in the pricing of the policy, because of age, health 
status, claims experience, receipt of health care, or medical 
condition. The policy may not provide any time period applicable to 
pre-existing conditions, waiting periods, elimination periods, and 
probationary periods (except as provided by paragraph (2)(B)). The 
Secretary may require enrollment through a third party designated under 
section 1876(c)(3)(B).''.
            (2) For medicare select policies.--Section 1882(t)(5) of 
        such Act (42 U.S.C. 1395ss(t)(5)), as added by section 204(6), 
        is amended by adding at the end the following new subparagraph:
            ``(C) The periods for enrollment applicable for the policy 
        are the same periods applicable to a Medicare supplemental 
        policy under section 1882(s)(4).''.
    (b) Enrollments for New Medicare Beneficiaries and Those Who 
Move.--Section 1876(c)(3)(A) of such Act (42 U.S.C. 1395mm(c)(3)(A)) is 
amended--
            (1) in clause (i), by striking ``clause (ii)'' and 
        inserting ``clauses (ii) through (iv)'', and
            (2) by adding at the end the following:
    ``(iii) Each eligible organization shall have an open enrollment 
period for each individual eligible to enroll under subsection (d) 
during any enrollment period specified by section 1837 that applies to 
that individual. Enrollment under this clause shall be effective as 
specified by section 1838.
    ``(iv) Each eligible organization shall have an open enrollment 
period for each individual eligible to enroll under subsection (d) who 
has previously resided outside the geographic area which the 
organization serves. The enrollment period shall begin with the 
beginning of the month that precedes the month in which the individual 
becomes a resident of that geographic area and shall end at the end of 
the following month. Enrollment under this clause shall be effective as 
of the first of the month following the month in which the individual 
enrolls.''.
    (c) Provision by Secretary of Enrollment Information and Other 
Information on Eligible Organizations and Medicare Supplemental 
Policies.--
            (1) In general.--Section 1804(b) of such Act (42 U.S.C. 
        1395b-2(b)) is amended to read as follows:
    ``(b) The Secretary shall provide information upon request 
(including through the mails and via a toll-free telephone number) to 
any individual entitled to benefits under this title on the programs 
under this title, including--
            ``(1) information to assist individuals in enrolling with 
        eligible organizations under section 1876 and in selecting 
        among such organizations for enrollment, including information 
        on the premiums charged by such organizations for enrollment; 
        and
            ``(2) information on Medicare supplemental policies under 
        section 1882, including the relationship of State programs 
        under title XIX to such policies and the premiums charged by 
        such policies for enrollment (to the extent information on such 
        premiums is available to the Secretary).''.
            (2) Conforming amendment.--Section 1882(f) of such Act (42 
        U.S.C. 1395ss(f)) is repealed.
    (d) Effective Date.--The amendments made by this section apply to 
enrollments occurring after 1997 (but only after the Secretary of 
Health and Human Services has prescribed the relevant annual period), 
except that the amendments made by subsection (b)(2) apply to 
enrollments for a Medicare supplemental policy made after 1997.

                          TITLE III--MEDICAID

SEC. 301. PROHIBITION ON PAYMENTS UNDER MEDICAID UNTIL COMPLETION OF 
              ORIENTATION, MEDICAL PROFILE, AND IMMUNIZATION.

    (a) Requirement for Orientation and Medical Profile.--
            (1) In general.--Notwithstanding any other provision of 
        law, no payment shall be made to a State under title XIX of the 
        Social Security Act with respect to expenditures incurred by it 
        for payment (determined under a prepaid capitation basis or 
        under any other risk basis) for services provided by any entity 
        (including a health insuring organization) for an individual 
        enrolled with the entity until the entity certifies to the 
        Secretary of Health and Human Services that--
                    (A) the entity has provided the enrollee with such 
                orientation as the Secretary of Health and Human 
                Services specifies, which orientation shall include the 
                explanation of rights described in paragraph (2) and 
                the explanation of access to care described in 
                paragraph (3);
                    (B) the entity has a medical profile described in 
                section 1876(c)(3)(G)(iii) of the Social Security Act 
                (as added by section 201(a)) with respect to the 
                enrollee; and
                    (C) if the entity is responsible for the provision 
                (directly or through arrangements with providers of 
                services) of immunizations for an enrollee who is a 
                child--
                            (i) the entity has obtained the 
                        immunization status of such child, and
                            (ii) the entity has begun to provide (or is 
                        providing) for immunizations of such child in 
                        accordance with the standards established for 
                        early and periodic screening, diagnostic, and 
                        treatment services under such title.
            (2) Explanation of rights.--The explanation of rights 
        described in this paragraph shall include an explanation of an 
        enrollee's rights under such title in relation to enrollment 
        with the entity, including an explanation of--
            (A) the enrollee's rights to benefits from the entity,
            (B) the restrictions on payments under such title for 
        services furnished other than by or through the entity,
            (C) out-of-area coverage provided by the entity,
            (D) the entity's coverage of emergency services and 
        urgently needed care, and
            (E) appeal rights of enrollees.
            (3) Explanation of access to care.--The explanation of 
        access to care described in this paragraph includes an 
        explanation of the following features of the benefits offered 
        by the entity under such title:
                    (A) Access to care, including choice of physician, 
                physician location, and hospital coverage.
                    (B) The information required under section 9914 of 
                the Internal Revenue Code of 1986.
    (b) Promulgation of Requirements for Orientation and Medical 
Profile.--Not later that 180 days after the date of the enactment of 
this Act, the Secretary of Health and Human Services shall, by rule, 
first specify the elements of the orientation and of the medical 
profile described in section 1876(c)(3)(G) of the Social Security Act. 
Chapter 8 of title 5, United States Code, shall not apply to such rule. 
Such rule shall apply on a final basis, pending notice and opportunity 
for public comment.
    (c) Effective Dates.--
            (1) In general.--Subject to paragraph (2), subsection (a) 
        applies with respect to enrollees as of the date that is 60 
        days after the date on which the Secretary first publishes the 
        rule under subsection (b) in the Federal Register.
            (2) Immunization requirements.--Subsection (a)(1)(C) 
        applies with respect to enrollees as of the first day of the 
        first month that begins more than 60 days after the date on 
        which the Secretary first publishes the rule under subsection 
        (b) in the Federal Register.

SEC. 302. REQUIREMENT FOR MEDICAID CAPITATED PLANS TO ASSURE 
              APPROPRIATE CHILDHOOD IMMUNIZATIONS.

    (a) In General.--Notwithstanding any other provision of law, no 
payment shall be made to a State under title XIX of the Social Security 
Act with respect to expenditures incurred by it for payment (determined 
under a prepaid capitation basis or under any other risk basis) for 
services provided by any entity (including a health insuring 
organization) which is responsible for the provision (directly or 
through arrangements with providers of services) of immunizations for 
children unless (and until)--
            (1) the entity has obtained the immunization status of each 
        child enrolled with the entity, and
            (2) the entity has begun to provide (or is providing) for 
        immunizations of each such child in accordance with the 
        standards established for early and periodic screening, 
        diagnostic, and treatment services under such title.
    (b) Effective Date.--Subsection (a) shall apply to expenditures by 
States for months beginning more than 180 days after the date of the 
enactment of this Act.
                                 <all>
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