I

105TH CONGRESS

1ST SESSION H. R. 820

To amend title XXVII of the Public Health Service Act to establish standards

for protection of consumers in managed care plans and other health

insurance coverage.

IN THE HOUSE OF REPRESENTATIVES

FEBRUARY 25, 1997

Mr. DINGELL introduced the following bill; which was referred to the

Committee on Commerce

A BILL

To amend title XXVII of the Public Health Service Act

to establish standards for protection of consumers in

managed care plans and other health insurance coverage.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

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

5 ‘‘Health Insurance Bill of Rights Act of 1997’’.

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

7 this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Amendments to the Public Health Service Act.

‘‘PART C—PATIENT PROTECTION STANDARDS
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‘‘Sec. 2770. Notice; additional definitions.

‘‘SUBPART 1—ACCESS TO CARE

‘‘Sec. 2771. Access to emergency care.

‘‘Sec. 2772. Access to specialty care.

‘‘Sec. 2773. Continuity of care.

‘‘Sec. 2774. Choice of provider.

‘‘Sec. 2775. Coverage for individuals participating in approved clinical

trials.

‘‘Sec. 2776. Access to needed prescription drugs.

‘‘SUBPART 2—QUALITY ASSURANCE

‘‘Sec. 2777. Internal quality assurance program.

‘‘Sec. 2778. Collection of standardized data.

‘‘Sec. 2779. Process for selection of providers.

‘‘Sec. 2780. Drug utilization program.

‘‘Sec. 2781. Standards for utilization review activities.

‘‘SUBPART 3—PATIENT INFORMATION

‘‘Sec. 2782. Patient information.

‘‘Sec. 2783. Protection of patient confidentiality.

‘‘SUBPART 4—GRIEVANCE PROCEDURES

‘‘Sec. 2784. Establishment of complaint and appeals process.

‘‘Sec. 2785. Provisions relating to appeals of utilization review determinations and similar determinations.

‘‘Sec. 2786. State health insurance ombudsmen.

‘‘SUBPART 5—PROTECTION OF PROVIDERS AGAINST INTERFERENCE WITH

MEDICAL COMMUNICATIONS AND IMPROPER INCENTIVE ARRANGEMENTS

‘‘Sec. 2787. Prohibition of interference with certain medical communications.

‘‘Sec. 2788. Prohibition against transfer of indemnification or improper incentive arrangements.

‘‘SUBPART 6—PROMOTING GOOD MEDICAL PRACTICE AND PROTECTING THE

DOCTOR-PATIENT RELATIONSHIP

‘‘Sec. 2789. Promoting good medical practice.

1 SEC. 2. AMENDMENTS TO THE PUBLIC HEALTH SERVICE

2 ACT.

3 (a) PATIENT PROTECTION STANDARDS.—Title

4 XXVII of the Public Health Service Act is amended—

5 (1) by redesignating part C as part D, and
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1 (2) by inserting after part B the following new

2 part:

3 ‘‘PART C—PATIENT PROTECTION STANDARDS

4 ‘‘SEC. 2770. NOTICE; ADDITIONAL DEFINITIONS.

5 ‘‘(a) NOTICE.—A health insurance issuer under this

6 part shall comply with the notice requirement under sec7 tion 711(d) of the Employee Retirement Income Security

8 Act of 1974 with respect to the requirements of this part

9 as if such section applied to such issuer and such issuer

10 were a group health plan.

11 ‘‘(b) ADDITIONAL DEFINITIONS.—For purposes of

12 this part:

13 ‘‘(1) NONPARTICIPATING PHYSICIAN OR PRO14 VIDER.—The term ‘nonparticipating physician or

15 provider’ means, with respect to health care items

16 and services furnished to an enrollee under health

17 insurance coverage, a physician or provider that is

18 not a participating physician or provider for such

19 services.

20 ‘‘(2) PARTICIPATING PHYSICIAN OR PRO21 VIDER.—The term ‘participating physician or pro22 vider’ means, with respect to health care items and

23 services furnished to an enrollee under health insur24 ance coverage, a physician or provider that furnishes

25 such items and services under a contract or other
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1 arrangement with the health insurance issuer offer2 ing such coverage.

3 ‘‘SUBPART 1—ACCESS TO CARE

4 ‘‘SEC. 2771. ACCESS TO EMERGENCY CARE.

5 ‘‘(a) PROHIBITION OF CERTAIN RESTRICTIONS ON

6 COVERAGE OF EMERGENCY SERVICES.

7 ‘‘(1) IN GENERAL.—If health insurance cov8 erage provides any benefits with respect to emer9 gency services (as defined in paragraph (2)(B)), the

10 health insurance issuer offering such coverage shall

11 cover emergency services furnished to an enrollee—

12 ‘‘(A) without the need for any prior au13 thorization determination,

14 ‘‘(B) subject to paragraph (3), whether or

15 not the physician or provider furnishing such

16 services is a participating physician or provider

17 with respect to such services, and

18 ‘‘(C) subject to paragraph (3), without re19 gard to any other term or condition of such cov20 erage (other than an exclusion of benefits, or an

21 affiliation or waiting period, permitted under

22 section 2701).

23 ‘‘(2) EMERGENCY SERVICES; EMERGENCY MEDI24 CAL CONDITION.—For purposes of this section—
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1 ‘‘(A) EMERGENCY MEDICAL CONDITION

2 BASED ON PRUDENT LAYPERSON.—The term

3 ‘emergency medical condition’ means a medical

4 condition manifesting itself by acute symptoms

5 of sufficient severity (including severe pain)

6 such that a prudent layperson, who possesses

7 an average knowledge of health and medicine,

8 could reasonably expect the absence of imme9 diate medical attention to result in—

10 ‘‘(i) placing the health of the individ11 ual (or, with respect to a pregnant woman,

12 the health of the woman or her unborn

13 child) in serious jeopardy,

14 ‘‘(ii) serious impairment to bodily

15 functions, or

16 ‘‘(iii) serious dysfunction of any bodily

17 organ or part.

18 ‘‘(B) EMERGENCY SERVICES.—The term

19 ‘emergency services’ means—

20 ‘‘(i) a medical screening examination

21 (as required under section 1867 of the So22 cial Security Act) that is within the capa23 bility of the emergency department of a
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1 hospital, including ancillary services rou2 tinely available to the emergency depart3 ment, to evaluate an emergency medical

4 condition (as defined in subparagraph

5 (A)), and

6 ‘‘(ii) within the capabilities of the

7 staff and facilities available at the hospital,

8 such further medical examination and

9 treatment as are required under section

10 1867 of the Social Security Act to stabilize

11 the patient.

12 ‘‘(C) TRAUMA AND BURN CENTERS.—The

13 provisions of clause (ii) of subparagraph (B)

14 apply to a trauma or burn center, in a hospital,

15 that—

16 ‘‘(i) is designated by the State, a re17 gional authority of the State, or by the

18 designee of the State, or

19 ‘‘(ii) is in a State that has not made

20 such designations and meets medically rec21 ognized national standards.

22 ‘‘(3) APPLICATION OF NETWORK RESTRICTION

23 PERMITTED IN CERTAIN CASES.—

24 ‘‘(A) IN GENERAL.—Except as provided in

25 subparagraph (B), if a health insurance issuer
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1 in relation to health insurance coverage denies,

2 limits, or otherwise differentiates in coverage or

3 payment for benefits other than emergency

4 services on the basis that the physician or pro5 vider of such services is a nonparticipating phy6 sician or provider, the issuer may deny, limit, or

7 differentiate in coverage or payment for emer8 gency services on such basis.

9 ‘‘(B) NETWORK RESTRICTIONS NOT PER10 MITTED IN CERTAIN EXCEPTIONAL CASES.—

11 The denial or limitation of, or differentiation in,

12 coverage or payment of benefits for emergency

13 services under subparagraph (A) shall not apply

14 in the following cases:

15 ‘‘(i) CIRCUMSTANCES BEYOND CON16 TROL OF ENROLLEE.—The enrollee is un17 able to go to a participating hospital for

18 such services due to circumstances beyond

19 the control of the enrollee (as determined

20 consistent with guidelines and subpara21 graph (C)).

22 ‘‘(ii) LIKELIHOOD OF AN ADVERSE

23 HEALTH CONSEQUENCE BASED ON

24 LAYPERSON’S JUDGMENT.—A prudent

25 layperson possessing an average knowledge
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1 of health and medicine could reasonably

2 believe that, under the circumstances and

3 consistent with guidelines, the time re4 quired to go to a participating hospital for

5 such services could result in any of the ad6 verse health consequences described in a

7 clause of subsection (a)(2)(A).

8 ‘‘(iii) PHYSICIAN REFERRAL.—A par9 ticipating physician or other person au10 thorized by the plan refers the enrollee to

11 an emergency department of a hospital and

12 does not specify an emergency department

13 of a hospital that is a participating hos14 pital with respect to such services.

15 ‘‘(C) APPLICATION OF ‘BEYOND CONTROL’

16 STANDARDS.—For purposes of applying sub17 paragraph (B)(i), receipt of emergency services

18 from a nonparticipating hospital shall be treat19 ed under the guidelines as being ‘due to cir20 cumstances beyond the control of the enrollee’

21 if any of the following conditions are met:

22 ‘‘(i) UNCONSCIOUS.—The enrollee was

23 unconscious or in an otherwise altered

24 mental state at the time of initiation of the

25 services.
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1 ‘‘(ii) AMBULANCE DELIVERY.—The

2 enrollee was transported by an ambulance

3 or other emergency vehicle directed by a

4 person other than the enrollee to the non5 participating hospital in which the services

6 were provided.

7 ‘‘(iii) NATURAL DISASTER.—A natural

8 disaster or civil disturbance prevented the

9 enrollee from presenting to a participating

10 hospital for the provision of such services.

11 ‘‘(iv) NO GOOD FAITH EFFORT TO IN12 FORM OF CHANGE IN PARTICIPATION DUR13 ING A CONTRACT YEAR.—The status of the

14 hospital changed from a participating hos15 pital to a nonparticipating hospital with re16 spect to emergency services during a con17 tract year and the plan or issuer failed to

18 make a good faith effort to notify the en19 rollee involved of such change.

20 ‘‘(v) OTHER CONDITIONS.—There

21 were other factors (such as those identified

22 in guidelines) that prevented the enrollee

23 from controlling selection of the hospital in

24 which the services were provided.
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1 ‘‘(b) ASSURING COORDINATED COVERAGE OF MAIN2 TENANCE CARE AND POST-STABILIZATION CARE.—

3 ‘‘(1) IN GENERAL.—In the case of an enrollee

4 who is covered under health insurance coverage is5 sued by a health insurance issuer and who has re6 ceived emergency services pursuant to a screening

7 evaluation conducted (or supervised) by a treating

8 physician at a hospital that is a nonparticipating

9 provider with respect to emergency services, if—

10 ‘‘(A) pursuant to such evaluation, the phy11 sician identifies post-stabilization care (as de12 fined in paragraph (3)(B)) that is required by

13 the enrollee,

14 ‘‘(B) the coverage provides benefits with

15 respect to the care so identified and the cov16 erage requires (but for this subsection) an af17 firmative prior authorization determination as a

18 condition of coverage of such care, and

19 ‘‘(C) the treating physician (or another in20 dividual acting on behalf of such physician) ini21 tiates, not later than 30 minutes after the time

22 the treating physician determines that the con23 dition of the enrollee is stabilized, a good faith

24 effort to contact a physician or other person au25 thorized by the issuer (by telephone or other
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1 means) to obtain an affirmative prior authoriza2 tion determination with respect to the care,

3 then, without regard to terms and conditions speci4 fied in paragraph (2) the issuer shall cover mainte5 nance care (as defined in paragraph (3)(A)) fur6 nished to the enrollee during the period specified in

7 paragraph (4) and shall cover post-stabilization care

8 furnished to the enrollee during the period beginning

9 under paragraph (5) and ending under paragraph

10 (6).

11 ‘‘(2) TERMS AND CONDITIONS WAIVED.—The

12 terms and conditions (of coverage) described in this

13 paragraph that are waived under paragraph (1) are

14 as follows:

15 ‘‘(A) The need for any prior authorization

16 determination.

17 ‘‘(B) Any limitation on coverage based on

18 whether or not the physician or provider fur19 nishing the care is a participating physician or

20 provider with respect to such care.

21 ‘‘(C) Any other term or condition of the

22 coverage (other than an exclusion of benefits, or

23 an affiliation or waiting period, permitted under
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1 section 2701 and other than a requirement re2 lating to medical necessity for coverage of bene3 fits).

4 ‘‘(3) MAINTENANCE CARE AND POST-STA5 BILIZATION CARE DEFINED.—In this subsection:

6 ‘‘(A) MAINTENANCE CARE.—The term

7 ‘maintenance care’ means, with respect to an

8 individual who is stabilized after provision of

9 emergency services, medically necessary items

10 and services (other than emergency services)

11 that are required by the individual to ensure

12 that the individual remains stabilized during

13 the period described in paragraph (4).

14 ‘‘(B) POST-STABILIZATION CARE.—The

15 term ‘post-stabilization care’ means, with re16 spect to an individual who is determined to be

17 stable pursuant to a medical screening examina18 tion or who is stabilized after provision of emer19 gency services, medically necessary items and

20 services (other than emergency services and

21 other than maintenance care) that are required

22 by the individual.

23 ‘‘(4) PERIOD OF REQUIRED COVERAGE OF

24 MAINTENANCE CARE.—The period of required cov25 erage of maintenance care of an individual under
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1 this subsection begins at the time of the request (or

2 the initiation of the good faith effort to make the re3 quest) under paragraph (1)(C) and ends when—

4 ‘‘(A) the individual is discharged from the

5 hospital;

6 ‘‘(B) a physician (designated by the issuer

7 involved) and with privileges at the hospital in8 volved arrives at the emergency department of

9 the hospital and assumes responsibility with re10 spect to the treatment of the individual; or

11 ‘‘(C) the treating physician and the issuer

12 agree to another arrangement with respect to

13 the care of the individual.

14 ‘‘(5) WHEN POST-STABILIZATION CARE RE15 QUIRED TO BE COVERED.—

16 ‘‘(A) WHEN TREATING PHYSICIAN UNABLE

17 TO COMMUNICATE REQUEST.—If the treating

18 physician or other individual makes the good

19 faith effort to request authorization under para20 graph (1)(C) but is unable to communicate the

21 request directly with an authorized person re22 ferred to in such paragraph within 30 minutes

23 after the time of initiating such effort, then

24 post-stabilization care is required to be covered
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1 under this subsection beginning at the end of

2 such 30-minute period.

3 ‘‘(B) WHEN ABLE TO COMMUNICATE RE4 QUEST, AND NO TIMELY RESPONSE.—

5 ‘‘(i) IN GENERAL.—If the treating

6 physician or other individual under para7 graph (1)(C) is able to communicate the

8 request within the 30-minute period de9 scribed in subparagraph (A), the post-sta10 bilization care requested is required to be

11 covered under this subsection beginning 30

12 minutes after the time when the issuer re13 ceives the request unless a person author14 ized by the plan or issuer involved commu15 nicates (or makes a good faith effort to

16 communicate) a denial of the request for

17 the prior authorization determination with18 in 30 minutes of the time when the issuer

19 receives the request and the treating physi20 cian does not request under clause (ii) to

21 communicate directly with an authorized

22 physician concerning the denial.

23 ‘‘(ii) REQUEST FOR DIRECT PHYSI24 CIAN-TO-PHYSICIAN COMMUNICATION CON25 CERNING DENIAL.—If a denial of a request
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1 is communicated under clause (i), the

2 treating physician may request to commu3 nicate respecting the denial directly with a

4 physician who is authorized by the issuer

5 to deny or affirm such a denial.

6 ‘‘(C) WHEN NO TIMELY RESPONSE TO RE7 QUEST FOR PHYSICIAN-TO-PHYSICIAN COMMU8 NICATION.—If a request for physician-to-physi9 cian communication is made under subpara10 graph (B)(ii), the post-stabilization care re11 quested is required to be covered under this

12 subsection beginning 30 minutes after the time

13 when the issuer receives the request from a

14 treating physician unless a physician, who is

15 authorized by the issuer to reverse or affirm the

16 initial denial of the care, communicates (or

17 makes a good faith effort to communicate) di18 rectly with the treating physician within such

19 30-minute period.

20 ‘‘(D) DISAGREEMENTS OVER POST-STA21 BILIZATION CARE.—If, after a direct physician22 to-physician communication under subpara23 graph (C), the denial of the request for the

24 post-stabilization care is not reversed and the

25 treating physician communicates to the issuer
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1 involved a disagreement with such decision, the

2 post-stabilization care requested is required to

3 be covered under this subsection beginning as

4 follows:

5 ‘‘(i) DELAY TO ALLOW FOR PROMPT

6 ARRIVAL OF PHYSICIAN ASSUMING RE7 SPONSIBILITY.—If the issuer commu8 nicates that a physician (designated by the

9 plan or issuer) with privileges at the hos10 pital involved will arrive promptly (as de11 termined under guidelines) at the emer12 gency department of the hospital in order

13 to assume responsibility with respect to the

14 treatment of the enrollee involved, the re15 quired coverage of the post-stabilization

16 care begins after the passage of such time

17 period as would allow the prompt arrival of

18 such a physician.

19 ‘‘(ii) OTHER CASES.—If the issuer

20 does not so communicate, the required cov21 erage of the post-stabilization care begins

22 immediately.

23 ‘‘(6) NO REQUIREMENT OF COVERAGE OF POST24 STABILIZATION CARE IF ALTERNATE PLAN OF

25 TREATMENT.—
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1 ‘‘(A) IN GENERAL.—Coverage of post-sta2 bilization care is not required under this sub3 section with respect to an individual when—

4 ‘‘(i) subject to subparagraph (B), a

5 physician (designated by the plan or issuer

6 involved) and with privileges at the hos7 pital involved arrives at the emergency de8 partment of the hospital and assumes re9 sponsibility with respect to the treatment

10 of the individual; or

11 ‘‘(ii) the treating physician and the is12 suer agree to another arrangement with re13 spect to the post-stabilization care (such as

14 an appropriate transfer of the individual

15 involved to another facility or an appoint16 ment for timely followup treatment for the

17 individual).

18 ‘‘(B) SPECIAL RULE WHERE ONCE CARE

19 INITIATED.—Required coverage of requested

20 post-stabilization care shall not end by reason

21 of subparagraph (A)(i) during an episode of

22 care (as determined by guidelines) if the treat23 ing physician initiated such care (consistent

24 with a previous paragraph) before the arrival of

25 a physician described in such subparagraph.
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1 ‘‘(7) CONSTRUCTION.—Nothing in this sub2 section shall be construed as—

3 ‘‘(A) preventing an issuer from authorizing

4 coverage of maintenance care or post-stabiliza5 tion care in advance or at any time; or

6 ‘‘(B) preventing a treating physician or

7 other individual described in paragraph (1)(C)

8 and an issuer from agreeing to modify any of

9 the time periods specified in paragraphs (5) as

10 it relates to cases involving such persons.

11 ‘‘(c) LIMITS ON COST-SHARING FOR SERVICES FUR12 NISHED IN EMERGENCY DEPARTMENTS.—If health insur13 ance coverage provides any benefits with respect to emer14 gency services, the health insurance issuer offering such

15 coverage may impose cost sharing with respect to such

16 services only if the following conditions are met:

17 ‘‘(1) LIMITATIONS ON COST-SHARING DIF18 FERENTIAL FOR NONPARTICIPATING PROVIDERS.—

19 ‘‘(A) NO DIFFERENTIAL FOR CERTAIN

20 SERVICES.—In the case of services furnished

21 under the circumstances described in clause (i),

22 (ii), or (iii) of subsection (a)(3)(B) (relating to

23 circumstances beyond the control of the en24 rollee, the likelihood of an adverse health con25 sequence based on layperson’s judgment, and
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1 physician referral), the cost-sharing for such

2 services provided by a nonparticipating provider

3 or physician does not exceed the cost-sharing

4 for such services provided by a participating

5 provider or physician.

6 ‘‘(B) ONLY REASONABLE DIFFERENTIAL

7 FOR OTHER SERVICES.—In the case of other

8 emergency services, any differential by which

9 the cost-sharing for such services provided by a

10 nonparticipating provider or physician exceeds

11 the cost-sharing for such services provided by a

12 participating provider or physician is reasonable

13 (as determined under guidelines).

14 ‘‘(2) ONLY REASONABLE DIFFERENTIAL BE15 TWEEN EMERGENCY SERVICES AND OTHER SERV16 ICES.—Any differential by which the cost-sharing for

17 services furnished in an emergency department ex18 ceeds the cost-sharing for such services furnished in

19 another setting is reasonable (as determined under

20 guidelines).

21 ‘‘(3) CONSTRUCTION.—Nothing in paragraph

22 (1)(B) or (2) shall be construed as authorizing

23 guidelines other than guidelines that establish maxi24 mum cost-sharing differentials.
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1 ‘‘(d) INFORMATION ON ACCESS TO EMERGENCY

2 SERVICES.—A health insurance issuer, to the extent a

3 health insurance issuer offers health insurance coverage,

4 shall provide education to enrollees on—

5 ‘‘(1) coverage of emergency services (as defined

6 in subsection (a)(2)(B)) by the issuer in accordance

7 with the provisions of this section,

8 ‘‘(2) the appropriate use of emergency services,

9 including use of the 911 telephone system or its

10 local equivalent,

11 ‘‘(3) any cost sharing applicable to emergency

12 services,

13 ‘‘(4) the process and procedures of the plan for

14 obtaining emergency services, and

15 ‘‘(5) the locations of—

16 ‘‘(A) emergency departments, and

17 ‘‘(B) other settings,

18 in which participating physicians and hospitals pro19 vide emergency services and post-stabilization care.

20 ‘‘(e) GENERAL DEFINITIONS.—For purposes of this

21 section:

22 ‘‘(1) COST SHARING.—The term ‘cost sharing’

23 means any deductible, coinsurance amount, copay24 ment or other out-of-pocket payment (other than
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1 premiums or enrollment fees) that a health insur2 ance offering health insurance issuer imposes on en3 rollees with respect to the coverage of benefits.

4 ‘‘(2) GOOD FAITH EFFORT.—The term ‘good

5 faith effort’ has the meaning given such term in

6 guidelines and requires such appropriate documenta7 tion as is specified under such guidelines.

8 ‘‘(3) GUIDELINES.—The term ‘guidelines’

9 means guidelines established by the Secretary after

10 consultation with an advisory panel that includes in11 dividuals representing emergency physicians, health

12 insurance issuers, including at least one health

13 maintenance organization, hospitals, employers, the

14 States, and consumers.

15 ‘‘(4) PRIOR AUTHORIZATION DETERMINA16 TION.—The term ‘prior authorization determination’

17 means, with respect to items and services for which

18 coverage may be provided under health insurance

19 coverage, a determination (before the provision of

20 the items and services and as a condition of coverage

21 of the items and services under the coverage) of

22 whether or not such items and services will be cov23 ered under the coverage.
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1 ‘‘(5) STABILIZE.—The term ‘to stabilize’

2 means, with respect to an emergency medical condi3 tion, to provide (in complying with section 1867 of

4 the Social Security Act) such medical treatment of

5 the condition as may be necessary to assure, within

6 reasonable medical probability, that no material de7 terioration of the condition is likely to result from or

8 occur during the transfer of the individual from the

9 facility.

10 ‘‘(6) STABILIZED.—The term ‘stabilized’

11 means, with respect to an emergency medical condi12 tion, that no material deterioration of the condition

13 is likely, within reasonable medical probability, to re14 sult from or occur before an individual can be trans15 ferred from the facility, in compliance with the re16 quirements of section 1867 of the Social Security

17 Act.

18 ‘‘(7) TREATING PHYSICIAN.—The term ‘treat19 ing physician’ includes a treating health care profes20 sional who is licensed under State law to provide

21 emergency services other than under the supervision

22 of a physician.

23 ‘‘SEC. 2772. ACCESS TO SPECIALTY CARE.

24 ‘‘(a) OBSTETRICAL AND GYNECOLOGICAL CARE.—
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1 ‘‘(1) IN GENERAL.—If a health insurance is2 suer, in connection with the provision of health in3 surance coverage, requires or provides for an en4 rollee to designate a participating primary care pro5 vider—

6 ‘‘(A) the issuer shall permit a female en7 rollee to designate a physician who specializes

8 in obstetrics and gynecology as the enrollee’s

9 primary care provider; and

10 ‘‘(B) if such an enrollee has not designated

11 such a provider as a primary care provider, the

12 issuer—

13 ‘‘(i) may not require prior authoriza14 tion by the enrollee’s primary care provider

15 or otherwise for coverage of routine gyne16 cological care (such as preventive women’s

17 health examinations) and pregnancy-relat18 ed services provided by a participating phy19 sician who specializes in obstetrics and

20 gynecology to the extent such care is other21 wise covered, and

22 ‘‘(ii) may treat the ordering of other

23 gynecological care by such a participating

24 physician as the prior authorization of the
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1 primary care provider with respect to such

2 care under the coverage.

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

4 (1)(B)(ii) shall waive any requirements of coverage

5 relating to medical necessity or appropriateness with

6 respect to coverage of gynecological care so ordered.

7 ‘‘(b) SPECIALTY CARE.—

8 ‘‘(1) REFERRAL TO SPECIALTY CARE FOR EN9 ROLLEES REQUIRING TREATMENT BY SPECIAL10 ISTS.—

11 ‘‘(A) IN GENERAL.—In the case of an en12 rollee who is covered under health insurance

13 coverage offered by a health insurance issuer

14 and who has a condition or disease of sufficient

15 seriousness and complexity to require treatment

16 by a specialist, the issuer shall make or provide

17 for a referral to a specialist who is available

18 and accessible to provide the treatment for such

19 condition or disease.

20 ‘‘(B) SPECIALIST DEFINED.—For purposes

21 of this subsection, the term ‘specialist’ means,

22 with respect to a condition, a health care practi23 tioner, facility, or center (such as a center of

24 excellence) that has adequate expertise through

25 appropriate training and experience (including,
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1 in the case of a child, appropriate pediatric ex2 pertise) to provide high quality care in treating

3 the condition.

4 ‘‘(C) CARE UNDER REFERRAL.—Care pro5 vided pursuant to such referral under subpara6 graph (A) shall be—

7 ‘‘(i) pursuant to a treatment plan (if

8 any) developed by the specialist and ap9 proved by the issuer, in consultation with

10 the designated primary care provider or

11 specialist and the enrollee (or the enrollee’s

12 designee), and

13 ‘‘(ii) in accordance with applicable

14 quality assurance and utilization review

15 standards of the issuer.

16 Nothing in this subsection shall be construed as

17 preventing such a treatment plan for an en18 rollee from requiring a specialist to provide the

19 primary care provider with regular updates on

20 the specialty care provided, as well as all nec21 essary medical information.
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1 ‘‘(D) REFERRALS TO PARTICIPATING PRO2 VIDERS.—An issuer is not required under sub3 paragraph (A) to provide for a referral to a spe4 cialist that is not a participating provider, un5 less the issuer does not have an appropriate

6 specialist that is available and accessible to

7 treat the enrollee’s condition and that is a par8 ticipating provider with respect to such treat9 ment.

10 ‘‘(E) TREATMENT OF NONPARTICIPATING

11 PROVIDERS.—If an issuer refers an enrollee to

12 a nonparticipating specialist, services provided

13 pursuant to the approved treatment plan shall

14 be provided at no additional cost to the enrollee

15 beyond what the enrollee would otherwise pay

16 for services received by such a specialist that is

17 a participating provider.

18 ‘‘(2) SPECIALISTS AS PRIMARY CARE PROVID19 ERS.—

20 ‘‘(A) IN GENERAL.—A health insurance is21 suer, in connection with the provision of health

22 insurance coverage, shall have a procedure by

23 which a new enrollee upon enrollment, or an en24 rollee upon diagnosis, with an ongoing special

25 condition (as defined in subparagraph (C)) may
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1 receive a referral to a specialist for such condi2 tion who shall be responsible for and capable of

3 providing and coordinating the enrollee’s pri4 mary and specialty care. If such an enrollee’s

5 care would most appropriately be coordinated

6 by such a specialist, the issuer shall refer the

7 enrollee to such specialist.

8 ‘‘(B) TREATMENT AS PRIMARY CARE PRO9 VIDER.—Such specialist shall be permitted to

10 treat the enrollee without a referral from the

11 enrollee’s primary care provider and may au12 thorize such referrals, procedures, tests, and

13 other medical services as the enrollee’s primary

14 care provider would otherwise be permitted to

15 provide or authorize, subject to the terms of the

16 treatment plan (referred to in paragraph

17 (1)(C)(i)).

18 ‘‘(C) ONGOING SPECIAL CONDITION DE19 FINED.—In this paragraph, the term ‘special

20 condition’ means a condition or disease that—

21 ‘‘(i) is life-threatening, degenerative,

22 or disabling, and

23 ‘‘(ii) requires specialized medical care

24 over a prolonged period of time.
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1 ‘‘(D) TERMS OF REFERRAL.—The provi2 sions of subparagraphs (C) through (E) of

3 paragraph (1) shall apply with respect to refer4 rals under subparagraph (A) of this paragraph

5 in the same manner as they apply to referrals

6 under paragraph (1)(A).

7 ‘‘(3) STANDING REFERRALS.—

8 ‘‘(A) IN GENERAL.—A health insurance is9 suer, in connection with the provision of health

10 insurance coverage, shall have a procedure by

11 which an enrollee who has a condition that re12 quires ongoing care from a specialist may re13 ceive a standing referral to such specialist for

14 treatment of such condition. If the issuer, or

15 the primary care provider in consultation with

16 the medical director of the issuer and the spe17 cialist (if any), determines that such a standing

18 referral is appropriate, the issuer shall make

19 such a referral to such a specialist.

20 ‘‘(C) TERMS OF REFERRAL.—The provi21 sions of subparagraphs (C) through (E) of

22 paragraph (1) shall apply with respect to refer23 rals under subparagraph (A) of this paragraph

24 in the same manner as they apply to referrals

25 under paragraph (1)(A).
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1 ‘‘SEC. 2773. CONTINUITY OF CARE.

2 ‘‘(a) IN GENERAL.—If a contract between a health

3 insurance issuer, in connection with the provision of health

4 insurance coverage, and a health care provider is termi5 nated (other than by the issuer for failure to meet applica6 ble quality standards or for fraud) and an enrollee is un7 dergoing a course of treatment from the provider at the

8 time of such termination, the issuer shall—

9 ‘‘(1) notify the enrollee of such termination,

10 and

11 ‘‘(2) subject to subsection (c), permit the en12 rollee to continue the course of treatment with the

13 provider during a transitional period (provided under

14 subsection (b)).

15 ‘‘(b) TRANSITIONAL PERIOD.—

16 ‘‘(1) IN GENERAL.—Except as provided in para17 graphs (2) through (4), the transitional period under

18 this subsection shall extend for at least—

19 ‘‘(A) 60 days from the date of the notice

20 to the enrollee of the provider’s termination in

21 the case of a primary care provider, or

22 ‘‘(B) 120 days from such date in the case

23 of another provider.

24 ‘‘(2) INSTITUTIONAL CARE.—The transitional

25 period under this subsection for institutional or in26 patient care from a provider shall extend until the
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1 discharge or termination of the period of institu2 tionalization and shall include reasonable follow-up

3 care related to the institutionalization and shall also

4 include institutional care scheduled prior to the date

5 of termination of the provider status.

6 ‘‘(3) PREGNANCY.—If—

7 ‘‘(A) an enrollee has entered the second

8 trimester of pregnancy at the time of a provid9 er’s termination of participation, and

10 ‘‘(B) the provider was treating the preg11 nancy before date of the termination,

12 the transitional period under this subsection with re13 spect to provider’s treatment of the pregnancy shall

14 extend through the provision of post-partum care di15 rectly related to the delivery.

16 ‘‘(4) TERMINAL ILLNESS.—

17 ‘‘(A) IN GENERAL.—If—

18 ‘‘(i) an enrollee was determined to be

19 terminally ill (as defined in subparagraph

20 (B)) at the time of a provider’s termi21 nation of participation, and

22 ‘‘(ii) the provider was treating the ter23 minal illness before the date of termi24 nation,
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1 the transitional period under this subsection

2 shall extend for the remainder of the enrollee’s

3 life for care directly related to the treatment of

4 the terminal illness.

5 ‘‘(B) DEFINITION.—In subparagraph (A),

6 an enrollee is considered to be ‘terminally ill’ if

7 the enrollee has a medical prognosis that the

8 enrollee’s life expectancy is 6 months or less.

9 ‘‘(c) PERMISSIBLE TERMS AND CONDITIONS.—An is10 suer may condition coverage of continued treatment by a

11 provider under subsection (a)(2) upon the provider agree12 ing to the following terms and conditions:

13 ‘‘(1) The provider agrees to continue to accept

14 reimbursement from the issuer at the rates applica15 ble prior to the start of the transitional period as

16 payment in full.

17 ‘‘(2) The provider agrees to adhere to the issu18 er’s quality assurance standards and to provide to

19 the issuer necessary medical information related to

20 the care provided.

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

22 the issuer’s policies and procedures, including proce23 dures regarding referrals and obtaining prior au24 thorization and providing services pursuant to a

25 treatment plan approved by the issuer.
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1 ‘‘SEC. 2774. CHOICE OF PROVIDER.

2 ‘‘(a) PRIMARY CARE.—A health insurance issuer that

3 offers health insurance coverage shall permit each enrollee

4 to receive primary care from any participating primary

5 care provider who is available to accept such enrollee.

6 ‘‘(b) SPECIALISTS.—

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

8 health insurance issuer that offers health insurance

9 coverage shall permit each enrollee to receive medi10 cally necessary specialty care, pursuant to appro11 priate referral procedures, from any qualified par12 ticipating health care provider who is available to ac13 cept such enrollee for such care.

14 ‘‘(2) LIMITATION.—Paragraph (1) shall not

15 apply to speciality care if the issuer clearly informs

16 enrollees of the limitations on choice of participating

17 providers with respect to such care.

18 ‘‘(c) LIST OF PARTICIPATING PROVIDERS.—For dis19 closure of information about participating primary care

20 and specialty care providers, see section 2782(b)(3).

21 ‘‘SEC. 2775. COVERAGE FOR INDIVIDUALS PARTICIPATING

22 IN APPROVED CLINICAL TRIALS.

23 ‘‘(a) IN GENERAL.—If a health insurance issuer of24 fers health insurance coverage to a qualified enrollee (as

25 defined in subsection (b)), the issuer—
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1 ‘‘(1) may not deny the enrollee participation in

2 the clinical trial referred to in subsection (b)(2);

3 ‘‘(2) subject to subsection (c), may not deny (or

4 limit or impose additional conditions on) the cov5 erage of routine patient costs for items and services

6 furnished in connection with participation in the

7 trial; and

8 ‘‘(3) may not discriminate against the enrollee

9 on the basis of the enrollee’s participation in such

10 trial.

11 ‘‘(b) QUALIFIED ENROLLEE DEFINED.—For pur12 poses of subsection (a), the term ‘qualified enrollee’ means

13 an enrollee under health insurance coverage who meets the

14 following conditions:

15 ‘‘(1) The enrollee has a life-threatening or seri16 ous illness for which no standard treatment is effec17 tive.

18 ‘‘(2) The enrollee is eligible to participate in an

19 approved clinical trial with respect to treatment of

20 such illness.

21 ‘‘(3) The enrollee and the referring physician

22 conclude that the enrollee’s participation in such

23 trial would be appropriate.
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1 ‘‘(4) The enrollee’s participation in the trial of2 fers potential for significant clinical benefit for the

3 enrollee.

4 ‘‘(c) PAYMENT.—

5 ‘‘(1) IN GENERAL.—Under this section an is6 suer shall provide for payment for routine patient

7 costs described in subsection (a)(2) but is not re8 quired to pay for costs of items and services that are

9 reasonably expected (as determined by the Sec10 retary) to be paid for by the sponsors of an ap11 proved clinical trial.

12 ‘‘(2) PAYMENT RATE.—In the case of covered

13 items and services provided by—

14 ‘‘(A) a participating provider, the payment

15 rate shall be at the agreed upon rate, or

16 ‘‘(B) a nonparticipating provider, the pay17 ment rate shall be at the rate the issuer would

18 normally pay for comparable services under

19 subparagraph (A).

20 ‘‘(d) APPROVED CLINICAL TRIAL DEFINED.—In this

21 section, the term ‘approved clinical trial’ means a clinical

22 research study or clinical investigation approved and fund23 ed by one or more of the following:

24 ‘‘(1) The National Institutes of Health.
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1 ‘‘(2) A cooperative group or center of the Na2 tional Institutes of Health.

3 ‘‘(3) The Department of Veterans Affairs.

4 ‘‘(4) The Department of Defense.

5 ‘‘SEC. 2776. ACCESS TO NEEDED PRESCRIPTION DRUGS.

6 ‘‘If a health insurance issuer offers health insurance

7 coverage that provides benefits with respect to prescription

8 drugs but the coverage limits such benefits to drugs in9 cluded in a formulary, the issuer shall—

10 ‘‘(1) ensure participation of participating physi11 cians in the development of the formulary;

12 ‘‘(2) disclose the nature of the formulary re13 strictions; and

14 ‘‘(3) provide for exceptions from the formulary

15 limitation when medical necessity, as determined by

16 the enrollee’s physician subject to reasonable review

17 by the issuer, dictates that a non-formulary alter18 native is indicated.

19 ‘‘SUBPART 2—QUALITY ASSURANCE

20 ‘‘SEC. 2777. INTERNAL QUALITY ASSURANCE PROGRAM.

21 ‘‘(a) REQUIREMENT.—A health insurance issuer that

22 offers health insurance coverage shall establish and main23 tain an ongoing, internal quality assurance and continuous

24 quality improvement program that meets the requirements

25 of subsection (b).
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1 ‘‘(b) PROGRAM REQUIREMENTS.—The requirements

2 of this subsection for a quality improvement program of

3 an issuer are as follows:

4 ‘‘(1) ADMINISTRATION.—The issuer has a sepa5 rate identifiable unit with responsibility for adminis6 tration of the program.

7 ‘‘(2) WRITTEN PLAN.—The issuer has a written

8 plan for the program that is updated annually and

9 that specifies at least the following:

10 ‘‘(A) The activities to be conducted.

11 ‘‘(B) The organizational structure.

12 ‘‘(C) The duties of the medical director.

13 ‘‘(D) Criteria and procedures for the as14 sessment of quality.

15 ‘‘(E) Systems for ongoing and focussed

16 evaluation activities.

17 ‘‘(3) SYSTEMATIC REVIEW.—The program pro18 vides for systematic review of the type of health

19 services provided, consistency of services provided

20 with good medical practice, and patient outcomes.

21 ‘‘(4) QUALITY CRITERIA.—The program—

22 ‘‘(A) uses criteria that are based on per23 formance and clinical outcomes where feasible

24 and appropriate, and
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1 ‘‘(B) includes criteria that are directed

2 specifically at meeting the needs of at-risk pop3 ulations and enrollees with chronic or severe ill4 nesses.

5 ‘‘(5) SYSTEM FOR REPORTING.—The program

6 has procedures for reporting of possible quality con7 cerns by providers and enrollees and for remedial ac8 tions to correct quality problems, including written

9 procedures for responding to concerns and taking

10 appropriate corrective action.

11 ‘‘(6) DATA COLLECTION.—The program pro12 vides for the collection of systematic, scientifically

13 based data to be used in the measure of quality.

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

15 requirements of subsection (b) are deemed to be met with

16 respect to a health insurance issuer if the issuer—

17 ‘‘(1) is a qualified health maintenance organiza18 tion (as defined in section 1310(d)), or

19 ‘‘(2) is accredited by a national accreditation

20 organization that is certified by the Secretary.

21 ‘‘SEC. 2778. COLLECTION OF STANDARDIZED DATA.

22 ‘‘(a) IN GENERAL.—A health insurance issuer that

23 offers health insurance coverage shall collect uniform qual24 ity data that include—
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1 ‘‘(1) a minimum uniform data set described in

2 subsection (b), and

3 ‘‘(2) additional data that are consistent with

4 the requirements of a nationally recognized body

5 identified by the Secretary.

6 ‘‘(b) MINIMUM UNIFORM DATA SET.—The Secretary

7 shall specify the data required to be included in the mini8 mum uniform data set under subsection (a)(1) and the

9 standard format for such data. Such data shall include

10 at least—

11 ‘‘(1) aggregate utilization data;

12 ‘‘(2) data on the demographic characteristics of

13 enrollees;

14 ‘‘(3) data on disease-specific and age-specific

15 mortality rates of enrollees;

16 ‘‘(4) data on enrollee satisfaction, including

17 data on enrollee disenrollment and grievances; and

18 ‘‘(5) data on quality indicators.

19 ‘‘(c) AVAILABILITY.—A summary of the data col20 lected under subsection (a) shall be disclosed under section

21 2782(b)(4).
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1 ‘‘SEC. 2779. PROCESS FOR SELECTION OF PROVIDERS.

2 ‘‘(a) IN GENERAL.—A health insurance issuer that

3 offers health insurance coverage shall have a written proc4 ess for the selection of participating health care profes5 sionals, including minimum professional requirements.

6 ‘‘(b) VERIFICATION OF BACKGROUND.—Such process

7 shall include verification of a health care provider’s li8 cense, a history of suspension or revocation, and liability

9 claim history.

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

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

12 with residents with poorer health status as a basis for ex13 cluding providers from participation.

14 ‘‘SEC. 2780. DRUG UTILIZATION PROGRAM.

15 ‘‘A health insurance issuer that provides health insur16 ance coverage that includes benefits for prescription drugs

17 shall establish and maintain a drug utilization program

18 which—

19 ‘‘(1) encourages appropriate use of prescription

20 drugs by enrollees and providers,

21 ‘‘(2) monitors illnesses arising from improper

22 drug use or from adverse drug reactions or inter23 actions, and

24 ‘‘(3) takes appropriate action to reduce the inci25 dence of improper drug use and adverse drug reac26 tions and interactions.
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1 ‘‘SEC. 2781. STANDARDS FOR UTILIZATION REVIEW ACTIVI2 TIES.

3 ‘‘(a) COMPLIANCE WITH REQUIREMENTS.—

4 ‘‘(1) IN GENERAL.—A health insurance issuer

5 shall conduct utilization review activities in connec6 tion with the provision of health insurance coverage

7 only in accordance with a utilization review program

8 that meets the requirements of this section.

9 ‘‘(2) USE OF OUTSIDE AGENTS.—Nothing in

10 this section shall be construed as preventing a health

11 insurance issuer from arranging through a contract

12 or otherwise for persons or entities to conduct utili13 zation review activities on behalf of the issuer, so

14 long as such activities are conducted in accordance

15 with a utilization review program that meets the re16 quirements of this section.

17 ‘‘(3) UTILIZATION REVIEW DEFINED.—For pur18 poses of this section, the terms ‘utilization review’

19 and ‘utilization review activities’ mean procedures

20 used to monitor or evaluate the clinical necessity,

21 appropriateness, efficacy, or efficiency of health care

22 services, procedures or settings, and includes ambu23 latory review, prospective review, concurrent review,

24 second opinions, case management, discharge plan25 ning, or retrospective review.

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

2 program shall be conducted consistent with written

3 policies and procedures that govern all aspects of the

4 program.

5 ‘‘(2) USE OF WRITTEN CRITERIA.—

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

7 utilize written clinical review criteria developed

8 pursuant to the program with the input of ap9 propriate physicians.

10 ‘‘(B) CONTINUING USE OF STANDARDS IN

11 RETROSPECTIVE REVIEW.—If a health care

12 service has been specifically pre-authorized or

13 approved for an enrollee under such a program,

14 the program shall not, pursuant to retrospective

15 review, revise or modify the specific standards,

16 criteria, or procedures used for the utilization

17 review for procedures, treatment, and services

18 delivered to the enrollee during the same course

19 of treatment.

20 ‘‘(C) NO ADVERSE DETERMINATION BASED

21 ON REFUSAL TO OBSERVE SERVICE.—Such a

22 program shall not base an adverse determina23 tion on—

24 ‘‘(i) a refusal to consent to observing

25 any health care service, or
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1 ‘‘(ii) lack of reasonable access to a

2 health care provider’s medical or treatment

3 records, unless the program has provided

4 reasonable notice to the enrollee.

5 ‘‘(c) CONDUCT OF PROGRAM ACTIVITIES.—

6 ‘‘(1) ADMINISTRATION BY HEALTH CARE PRO7 FESSIONALS.—A utilization review program shall be

8 administered by qualified health care professionals

9 who shall oversee review decisions. In this sub10 section, the term ‘health care professional’ means a

11 physician or other health care practitioner licensed,

12 accredited, or certified to perform specified health

13 services consistent with State law.

14 ‘‘(2) USE OF QUALIFIED, INDEPENDENT PER15 SONNEL.—

16 ‘‘(A) IN GENERAL.—A utilization review

17 program shall provide for the conduct of utiliza18 tion review activities only through personnel

19 who are qualified and, to the extent required,

20 who have received appropriate training in the

21 conduct of such activities under the program.

22 ‘‘(B) PEER REVIEW OF ADVERSE CLINICAL

23 DETERMINATIONS.—Such a program shall pro24 vide that clinical peers shall evaluate the clinical
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1 appropriateness of adverse clinical determina2 tions. In this subsection, the term ‘clinical peer’

3 means, with respect to a review, a physician or

4 other health care professional who holds a non5 restricted license in a State and in the same or

6 similar specialty as typically manages the medi7 cal condition, procedure, or treatment under re8 view.

9 ‘‘(C) PROHIBITION OF CONTINGENT COM10 PENSATION ARRANGEMENTS.—Such a program

11 shall not, with respect to utilization review ac12 tivities, permit or provide compensation or any13 thing of value to its employees, agents, or con14 tractors in a manner that—

15 ‘‘(i) provides incentives, direct or indi16 rect, for such persons to make inappropri17 ate review decisions, or

18 ‘‘(ii) is based, directly or indirectly, on

19 the quantity or type of adverse determina20 tions rendered.

21 ‘‘(D) PROHIBITION OF CONFLICTS.—Such

22 a program shall not permit a health care pro23 fessional who provides health care services to an

24 enrollee to perform utilization review activities
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1 in connection with the health care services

2 being provided to the enrollee.

3 ‘‘(3) TOLL-FREE TELEPHONE NUMBER.—Such

4 a program shall provide that—

5 ‘‘(A) appropriate personnel performing uti6 lization review activities under the program are

7 reasonably accessible by toll-free telephone not

8 less than 40 hours per week during normal

9 business hours to discuss patient care and allow

10 response to telephone requests, and

11 ‘‘(B) the program has a telephone system

12 capable of accepting, recording, or providing in13 struction to incoming telephone calls during

14 other than normal business hours and to ensure

15 response to accepted or recorded messages not

16 less than one business day after the date on

17 which the call was received.

18 ‘‘(4) LIMITS ON FREQUENCY.—Such a program

19 shall not provide for the performance of utilization

20 review activities with respect to a class of services

21 furnished to an enrollee more frequently than is rea22 sonably required to assess whether the services

23 under review are medically necessary.

24 ‘‘(5) LIMITATION ON INFORMATION RE25 QUESTS.—Under such a program, information shall
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1 be required to be provided by health care providers

2 only to the extent it is necessary to perform the uti3 lization review activity involved.

4 ‘‘(d) DEADLINE FOR DETERMINATIONS.—

5 ‘‘(1) PRIOR AUTHORIZATION SERVICES.—Ex6 cept as provided in paragraph (2), in the case of a

7 utilization review activity involving the prior author8 ization of health care items and services, the utiliza9 tion review program shall make a determination con10 cerning such authorization, and provide notice of the

11 determination to the enrollee or the enrollee’s des12 ignee and the enrollee’s health care provider by tele13 phone and in writing, as soon as possible in accord14 ance with the medical exigencies of the cases, and in

15 no event later than 3 business days after the date

16 of receipt of the necessary information respecting

17 such determination.

18 ‘‘(2) CONTINUED CARE.—In the case of a utili19 zation review activity involving authorization for con20 tinued or extended health care services, or additional

21 services for an enrollee undergoing a course of con22 tinued treatment prescribed by a health care pro23 vider, the utilization review program shall make a

24 determination concerning such authorization, and

25 provide notice of the determination to the enrollee or
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1 the enrollee’s designee and the enrollee’s health care

2 provider by telephone and in writing, within 1 busi3 ness day of the date of receipt of the necessary in4 formation respecting such determination. Such no5 tice shall include, with respect to continued or ex6 tended health care services, the number of extended

7 services approved, the new total of approved serv8 ices, the date of onset of services, and the next re9 view date.

10 ‘‘(3) PREVIOUSLY PROVIDED SERVICES.—In the

11 case of a utilization review activity involving retro12 spective review of health care services previously pro13 vided, the utilization review program shall make a

14 the determination concerning such services, and pro15 vide notice of the determination to the enrollee or

16 the enrollee’s designee and the enrollee’s health care

17 provider by telephone and in writing, within 30 days

18 of the date of receipt of the necessary information

19 respecting such determination.

20 ‘‘(4) REFERENCE TO SPECIAL RULES FOR

21 EMERGENCY SERVICES, MAINTENANCE CARE, AND

22 POST-STABILIZATION CARE.—For waiver of prior au23 thorization requirements in certain cases involving

24 emergency services and maintenance care and post-
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1 stabilization care, see sections 2771(a)(1)(A) and

2 2771(a)(2)(A), respectively.

3 ‘‘(e) NOTICE OF ADVERSE DETERMINATIONS.—

4 ‘‘(1) IN GENERAL.—Notice of an adverse deter5 mination under a utilization review program (includ6 ing as a result of a reconsideration under subsection

7 (f)) shall be in writing and shall include—

8 ‘‘(A) the reasons for the determination (in9 cluding the clinical rationale);

10 ‘‘(B) instructions on how to initiate an ap11 peal under section 2785; and

12 ‘‘(C) notice of the availability, upon re13 quest of the enrollee (or the enrollee’s designee)

14 of the clinical review criteria relied upon to

15 make such determination.

16 ‘‘(2) SPECIFICATION OF ANY ADDITIONAL IN17 FORMATION.—Such a notice shall also specify what

18 (if any) additional necessary information must be

19 provided to, or obtained by, person making the de20 termination in order to make a decision on such an

21 appeal.

22 ‘‘(f) RECONSIDERATION.—

23 ‘‘(1) AT REQUEST OF PROVIDER.—In the event

24 that a utilization review program provides for an ad25 verse determination without attempting to discuss
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1 such matter with the enrollee’s health care provider

2 who specifically recommended the health care serv3 ice, procedure, or treatment under review, such

4 health care provider shall have the opportunity to re5 quest a reconsideration of the adverse determination

6 under this subsection.

7 ‘‘(2) TIMING AND CONDUCT.—Except in cases

8 of retrospective reviews, such reconsideration shall

9 occur as soon as possible in accordance with the

10 medical exigencies of the cases, and in no event later

11 than 1 business day after the date of receipt of the

12 request and shall be conducted by the enrollee’s

13 health care provider and the health care professional

14 making the initial determination or a designated

15 qualified health care professional if the original pro16 fessional cannot be available.

17 ‘‘(3) NOTICE.—In the event that the adverse

18 determination is upheld after reconsideration, the

19 utilization review program shall provide notice as re20 quired under subsection (e).

21 ‘‘(4) CONSTRUCTION.—Nothing in this sub22 section shall preclude the enrollee from initiating an

23 appeal from an adverse determination under section

24 2785.
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1 ‘‘SUBPART 3—PATIENT INFORMATION

2 ‘‘SEC. 2782. PATIENT INFORMATION.

3 ‘‘(a) DISCLOSURE REQUIREMENT.—A health insur4 ance issuer in connection with the provision of health in5 surance coverage shall submit to the applicable State au6 thority, provide to enrollees (and prospective enrollees),

7 and make available to the public, in writing the informa8 tion described in subsection (b).

9 ‘‘(b) INFORMATION.—The information described in

10 this subsection includes the following:

11 ‘‘(1) DESCRIPTION OF COVERAGE.—A descrip12 tion of coverage provisions, including health care

13 benefits, benefit limits, coverage exclusions, coverage

14 of emergency care, and the definition of medical ne15 cessity used in determining whether benefits will be

16 covered.

17 ‘‘(2) ENROLLEE FINANCIAL RESPONSIBILITY.—

18 An explanation of an enrollee’s financial responsibil19 ity for payment of premiums, coinsurance, copay20 ments, deductibles, and any other charges, including

21 limits on such responsibility and responsibility for

22 health care services that are provided by nonpartici23 pating providers or are furnished without meeting

24 applicable utilization review requirements.
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1 ‘‘(3) INFORMATION ON PROVIDERS.—A descrip2 tion—

3 ‘‘(A) of procedures for enrollees to select,

4 access, and change participating primary and

5 specialty providers,

6 ‘‘(B) of the rights and procedures for ob7 taining referrals (including standing referrals)

8 to participating and nonparticipating providers,

9 and

10 ‘‘(C) in the case of each participating pro11 vider, of the name, address, and telephone num12 ber of the provider, the credentials of the pro13 vider, and the provider’s availability to accept

14 new patients.

15 ‘‘(4) UTILIZATION REVIEW ACTIVITIES.—A de16 scription of procedures used and requirements (in17 cluding circumstances, time frames, and rights to re18 consideration and appeal) under any utilization re19 view program under section 2781 or any drug utili20 zation program under section 2780, as well as a

21 summary of the minimum uniform data collected

22 under section 2778(a)(1).

23 ‘‘(5) GRIEVANCE PROCEDURES.—Information

24 on the grievance procedures under sections 2784 and

25 2785, including information describing—
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1 ‘‘(A) the grievance procedures used by the

2 issuer to process and resolve disputes between

3 the issuer and an enrollee (including method for

4 filing grievances and the time frames and cir5 cumstances for acting on grievances);

6 ‘‘(B) written complaints and appeals, by

7 type of complaint or appeal, received by the is8 suer relating to its coverage; and

9 ‘‘(C) the disposition of such complaints

10 and appeals.

11 ‘‘(6) PAYMENT METHODOLOGY.—A description

12 of the types of methodologies the issuer uses to re13 imburse different classes of providers and, as speci14 fied by the Secretary, the financial arrangements or

15 contractual provisions with providers.

16 ‘‘(7) INFORMATION ON ISSUER.—Notice of ap17 propriate mailing addresses and telephone numbers

18 to be used by enrollees in seeking information or au19 thorization for treatment.

20 ‘‘(8) ASSURING COMMUNICATIONS WITH EN21 ROLLEES.—A description of how the issuer address22 es the needs of non-English-speaking enrollees and

23 others with special communications needs, including

24 the provision of information described in this sub25 section to such enrollees.
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1 ‘‘(c) FORM OF DISCLOSURE.—

2 ‘‘(1) UNIFORMITY.—Information required to be

3 disclosed under this section shall be provided in ac4 cordance with uniform, national reporting standards

5 specified by the Secretary, after consultation with

6 applicable State authorities, so that prospective en7 rollees may compare the attributes of different issu8 ers and coverage offered within an area.

9 ‘‘(2) INFORMATION INTO HANDBOOK.—Nothing

10 in this section shall be construed as preventing an

11 issuer from making the information under sub12 section (b) available to enrollees through an enrollee

13 handbook or similar publication.

14 ‘‘(3) UPDATING.—The information on partici15 pating providers described in subsection (a)(3)(C)

16 shall be updated not less frequently than monthly.

17 Nothing in this section shall prevent an issuer from

18 changing or updating other information made avail19 able under this section.

20 ‘‘(4) CONSTRUCTION.—Nothing in subsection

21 (a)(6) shall be construed as requiring disclosure of

22 individual contracts or financial arrangements be23 tween an issuer and any provider. Nothing in this
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1 subsection shall be construed as preventing the in2 formation described in subsection (a)(3)(C) from

3 being provided in a separate document.

4 ‘‘SEC. 2783. PROTECTION OF PATIENT CONFIDENTIALITY.

5 ‘‘A health insurance issuer that offers health insur6 ance coverage shall establish appropriate policies and pro7 cedures to ensure that all applicable State and Federal

8 laws to protect the confidentiality of individually identifi9 able medical information are followed.

10 ‘‘SUBPART 4—GRIEVANCE PROCEDURES

11 ‘‘SEC. 2784. ESTABLISHMENT OF COMPLAINT AND APPEALS

12 PROCESS.

13 ‘‘(a) ESTABLISHMENT OF SYSTEM.—A health insur14 ance issuer in connection with the provision of health in15 surance coverage shall establish and maintain a system to

16 provide for the presentation and resolution of complaints

17 and appeals brought by enrollees, designees of enrollees,

18 or by health care providers acting on behalf of an enrollee

19 and with the enrollee’s consent, regarding any aspect of

20 the issuer’s health care services, including complaints re21 garding quality of care, choice and accessibility of provid22 ers, network adequacy, and compliance with the require23 ments of this part.
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1 ‘‘(b) COMPONENTS OF SYSTEM.—Such system shall

2 include the following components (which shall be consist3 ent with applicable requirements of section 2785):

4 ‘‘(1) Written notification to all enrollees and

5 providers of the telephone numbers and business ad6 dresses of the issuer employees responsible for reso7 lution of complaints and appeals.

8 ‘‘(2) A system to record and document, over a

9 period of at least 3 years, all complaints and appeals

10 made and their status.

11 ‘‘(3) The availability of an enrollee services rep12 resentative to assist enrollees, as requested, with

13 complaint and appeal procedures.

14 ‘‘(4) Establishment of a specified deadline (not

15 to exceed 30 days after the date of receipt of a com16 plaint or appeal) for the issuer to respond to com17 plaints or appeals.

18 ‘‘(5) A process describing how complaints and

19 appeals are processed and resolved.

20 ‘‘(6) Procedures for follow-up action, including

21 the methods to inform the complainant or appellant

22 of the resolution of a complaint or appeal.

23 ‘‘(7) Notification to the continuous quality im24 provement program under section 2777(a) of all

25 complaints and appeals relating to quality of care.
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1 ‘‘(c) NO REPRISAL FOR EXERCISE OF RIGHTS.—A

2 health insurance issuer shall not take any action with re3 spect to an enrollee or a health care provider that is in4 tended to penalize the enrollee, a designee of the enrollee,

5 or the health care provider for discussing or exercising any

6 rights provided under this part (including the filing of a

7 complaint or appeal pursuant to this section).

8 ‘‘SEC. 2785. PROVISIONS RELATING TO APPEALS OF UTILI9 ZATION REVIEW DETERMINATIONS AND SIMI10 LAR DETERMINATIONS.

11 ‘‘(a) RIGHT OF APPEAL.—

12 ‘‘(1) IN GENERAL.—An enrollee in health insur13 ance coverage offered by a health insurance issuer,

14 and any provider acting on behalf of the enrollee

15 with the enrollee’s consent, may appeal any appeal16 able decision (as defined in paragraph (2)) under the

17 procedures described in this section and (to the ex18 tent applicable) section 2784. Such enrollees and

19 providers shall be provided with a written expla20 nation of the appeal process upon the conclusion of

21 each stage in the appeal process and as provided in

22 section 2782(a)(5)

23 ‘‘(2) APPEALABLE DECISION DEFINED.—In this

24 section, the term ‘appealable decision’ means any of

25 the following:
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1 ‘‘(A) An adverse determination under a

2 utilization review program under section 2781.

3 ‘‘(B) Denial of access to specialty and

4 other care under section 2772.

5 ‘‘(C) Denial of continuation of care under

6 section 2773.

7 ‘‘(D) Denial of a choice of provider under

8 section 2774.

9 ‘‘(E) Denial of coverage of routine patient

10 costs in connection with an approval clinical

11 trial under section 2775.

12 ‘‘(F) Denial of access to needed drugs

13 under section 2776(3).

14 ‘‘(G) The imposition of a limitation that is

15 prohibited under section 2789.

16 ‘‘(H) Denial of payment for a benefit,

17 ‘‘(b) INFORMAL INTERNAL APPEAL PROCESS (STAGE

18 1).—

19 ‘‘(1) IN GENERAL.—Each issuer shall establish

20 and maintain an informal internal appeal process

21 (an appeal under such process in this section re22 ferred to as a ‘stage 1 appeal’) under which any en23 rollee or any provider acting on behalf of an enrollee

24 with the enrollee’s consent, who is dissatisfied with
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1 any appealable decision has the opportunity to dis2 cuss and appeal that decision with the medical direc3 tor of the issuer or the health care professional who

4 made the decision.

5 ‘‘(2) TIMING.—All appeals under this para6 graph shall be concluded as soon as possible in ac7 cordance with the medical exigencies of the cases,

8 and in no event later than 72 hours in the case of

9 appeals from decisions regarding urgent care and 5

10 days in the case of all other appeals.

11 ‘‘(3) FURTHER REVIEW.—If the appeal is not

12 resolved to the satisfaction of the enrollee at this

13 level by the deadline under paragraph (2), the issuer

14 shall provide the enrollee and provider (if any) with

15 a written explanation of the decision and the right

16 to proceed to a stage 2 appeal under subsection (c).

17 ‘‘(c) FORMAL INTERNAL APPEAL PROCESS (STAGE

18 2).—

19 ‘‘(1) IN GENERAL.—Each issuer shall establish

20 and maintain a formal internal appeal process (an

21 appeal under such process in this section referred to

22 as a ‘stage 2 appeal’) under which any enrollee or

23 provider acting on behalf of an enrollee with the en24 rollee’s consent, who is dissatisfied with the results

25 of a stage 1 appeal has the opportunity to appeal
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1 the results before a panel that includes a physician

2 or other health care professional (or professionals)

3 selected by the issuer who have not been involved in

4 the appealable decision at issue in the appeal.

5 ‘‘(2) AVAILABILITY OF CLINICAL PEERS.—The

6 panel under subparagraph (A) shall have available

7 either clinical peers (as defined in section

8 2781(c)(2)(B)) who have not been involved in the

9 appealable decision at issue in the appeal or others

10 who are mutually agreed upon by the parties. If re11 quested by the enrollee or enrollee’s provider with

12 the enrollee’s consent, such a peer shall participate

13 in the panel’s review of the case.

14 ‘‘(3) TIMELY ACKNOWLEDGMENT.—The issuer

15 shall acknowledge the enrollee or provider involved

16 of the receipt of a stage 2 appeals upon receipt of

17 the appeal.

18 ‘‘(4) DEADLINE.—

19 ‘‘(A) IN GENERAL.—The issuer shall con20 clude each stage 2 appeal as soon as possible

21 after the date of the receipt of the appeal in ac22 cordance with medical exigencies of the case in23 volved, but in no event later than 72 hours in
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1 the case of appeals from decisions regarding ur2 gent care and (except as provided in subpara3 graph (B)) 20 business days in the case of all

4 other appeals.

5 ‘‘(B) EXTENSION.—An issuer may extend

6 the deadline for an appeal that does not relate

7 to a decision regarding urgent or emergency

8 care up to an additional 20 business days where

9 it can demonstrate to the applicable State au10 thority reasonable cause for the delay beyond

11 its control and where it provides, within the

12 original deadline under subparagraph (A), a

13 written progress report and explanation for the

14 delay to such authority and to the enrollee and

15 provider involved.

16 ‘‘(5) NOTICE.—If an issuer denies a stage 2 ap17 peal, the issuer shall provide the enrollee and pro18 vider involved with written notification of the denial

19 and the reasons therefore, together with a written

20 notification of rights to any further appeal

21 ‘‘(d) DIRECT USE OF FURTHER APPEALS.—In the

22 event that the issuer fails to comply with any of the dead23 lines for completion of appeals under this section or in

24 the event that the issuer for any reason expressly waives
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1 its rights to an internal review of an appeal under sub2 section (b) or (c), the enrollee and provider involved shall

3 be relieved of any obligation to complete the appeal stage

4 involved and may, at the enrollee’s or provider’s option,

5 proceed directly to seek further appeal through any appli6 cable external appeals process.

7 ‘‘(e) EXTERNAL APPEAL PROCESS IN CASE OF USE

8 OF EXPERIMENTAL TREATMENT TO SAVE LIFE OF PA9 TIENT.—

10 ‘‘(1) IN GENERAL.—In the case of an enrollee

11 described in paragraph (2), the health insurance is12 suer shall provide for an external independent review

13 process respecting the issuer’s decision not to cover

14 the experimental therapy (described in paragraph

15 (2)(B)(ii)).

16 ‘‘(2) ENROLLEE DESCRIBED.—An enrollee de17 scribed in this paragraph is an enrollee who meets

18 the following requirements:

19 ‘‘(A) The enrollee has a terminal condition

20 that is highly likely to cause death within 2

21 years.

22 ‘‘(B) The enrollee’s physician certifies

23 that—
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1 ‘‘(i) there is no standard, medically

2 appropriate therapy for successfully treat3 ing such terminal condition, but

4 ‘‘(ii) based on medical and scientific

5 evidence, there is a drug, device, proce6 dure, or therapy (in this section referred to

7 as the ‘experimental therapy’) that is more

8 beneficial than any available standard ther9 apy.

10 ‘‘(C) The issuer has denied coverage of the

11 experimental therapy on the basis that it is ex12 perimental or investigational.

13 ‘‘(3) DESCRIPTION OF PROCESS AND DECI14 SION.—The process under this subsection shall pro15 vide for a determination on a timely basis, by a

16 panel of independent, impartial physicians appointed

17 by a State authority or by an independent review or18 ganization certified by the State, of the medical ap19 propriateness of the experimental therapy. The deci20 sion of the panel shall be in writing and shall be ac21 companied by an explanation of the basis for the de22 cision. A decision of the panel that is favorable to

23 the enrollee may not be appealed by the issuer ex24 cept in the case of misrepresentation of a material

25 fact by the enrollee or a provider. A decision of the
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1 panel that is not favorable to the enrollee may be

2 appealed by the enrollee.

3 ‘‘(4) ISSUER COVERING PROCESS COSTS.—Di4 rect costs of the process under this subsection shall

5 be borne by the issuer, and not by the enrollee.

6 ‘‘(f) OTHER INDEPENDENT OR EXTERNAL RE7 VIEW.—

8 ‘‘(1) IN GENERAL.—In the case of appealable

9 decision described in paragraph (2), the health in10 surance issuer shall provide for—

11 ‘‘(A) an external review process for such

12 decisions consistent with the requirements of

13 paragraph (3), or

14 ‘‘(B) an internal independent review proc15 ess for such decisions consistent with the re16 quirements of paragraph (4).

17 ‘‘(2) APPEALABLE DECISION DESCRIBED.—An

18 appealable decision described in this paragraph is

19 decision that does not involve a decision described in

20 subsection (e)(1) but involves—

21 ‘‘(A) a claim for benefits involving costs

22 over a significant threshold, or

23 ‘‘(B) assuring access to care for a serious

24 condition.
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1 ‘‘(3) EXTERNAL REVIEW PROCESS.—The re2 quirements of this subsection for an external review

3 process are as follows:

4 ‘‘(A) The process is established under

5 State law and provides for review of decisions

6 on stage 2 appeals by an independent review or7 ganization certified by the State.

8 ‘‘(B) If the process provides that decisions

9 in such process are not binding on issuers, the

10 process must provide for public methods of dis11 closing frequency of noncompliance with such

12 decisions and for sanctioning issuers that con13 sistently refuse to take appropriate actions in

14 response to such decisions.

15 ‘‘(C) Results of all such reviews under the

16 process are disclosed to the public, along with

17 at least annual disclosure of information on is18 suer compliance.

19 ‘‘(D) All decisions under the process shall

20 be in writing and shall be accompanied by an

21 explanation of the basis for the decision.

22 ‘‘(E) Direct costs of the process shall be

23 borne by the issuer, and not by the enrollee.

24 ‘‘(F) The issuer shall provide for publica25 tion at least annually of information on the
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1 numbers of appeals and decisions considered

2 under the process.

3 ‘‘(4) INTERNAL, INDEPENDENT REVIEW PROC4 ESS.—The requirements of this subsection for an in5 ternal, independent review process are as follows:

6 ‘‘(A)(i) The process must provide for the

7 participation of persons who are independent of

8 the issuer in conducting reviews and (ii) the

9 Secretary must have found (through reviews

10 conducted no less often than biannually) the

11 process to be fair and impartial.

12 ‘‘(B) If the process provides that decisions

13 in such process are not binding on issuers, the

14 process must provide for public methods of dis15 closing frequency of noncompliance with such

16 decisions and for sanctioning issuers that con17 sistently refuse to take appropriate actions in

18 response to such decisions.

19 ‘‘(C) Results of all such reviews under the

20 process are disclosed to the public, along with

21 at least annual disclosure of information on is22 suer compliance.

23 ‘‘(D) All decisions under the process shall

24 be in writing and shall be accompanied by an

25 explanation of the basis for the decision.
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1 ‘‘(E) Direct costs of the process shall be

2 borne by the issuer, and not by the enrollee.

3 ‘‘(F) The issuer shall provide for publica4 tion at least annually of information on the

5 numbers of appeals and decisions considered

6 under the process.

7 The Secretary may delegate the authority under sub8 paragraph (A)(ii) to applicable State authorities.

9 ‘‘(5) OVERSIGHT.—The Secretary (and applica10 ble State authorities in the case of delegation of Sec11 retarial authority under paragraph (4)) shall con12 duct reviews not less often than biannually of the

13 fairness and impartiality issuers who desired to use

14 an internal, independent review process described in

15 paragraph (4) to satisfy the requirement of para16 graph (1).

17 ‘‘(6) REPORT.—The Secretary shall provide for

18 periodic reports on the effectiveness of this sub19 section in assuring fair and impartial reviews of

20 stage 2 appeals. Such reports shall include informa21 tion on the number of stage 2 appeals (and deci22 sions), for each of the types of review processes de23 scribed in paragraph (2), by health insurance cov24 erage.
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1 ‘‘(g) CONSTRUCTION.—Nothing in this part shall be

2 construed as removing any legal rights of enrollees under

3 State or Federal law, including the right to file judicial

4 actions to enforce rights.

5 ‘‘SEC. 2786. STATE HEALTH INSURANCE OMBUDSMEN.

6 ‘‘(a) IN GENERAL.—Each State that obtains a grant

7 under subsection (c) shall establish and maintain a Health

8 Insurance Ombudsman. Such Ombudsman may be part of

9 a independent, nonprofit entity, and shall be responsible

10 for at least the following:

11 ‘‘(1) To assist consumers in the State in choos12 ing among health insurance coverage.

13 ‘‘(2) To provide counseling and assistance to

14 enrollees dissatisfied with their treatment by health

15 insurance issuers in regard to such coverage and in

16 the filing of complaints and appeals regarding deter17 minations under such coverage.

18 ‘‘(3) To investigate instances of poor quality or

19 improper treatment of enrollees by health insurance

20 issuers in regard to such coverage and to bring such

21 instances to the attention of the applicable State au22 thority.

23 ‘‘(b) FEDERAL ROLE.—In the case of any State that

24 does not establish and maintain such an Ombudsman

25 under subsection (a), the Secretary shall provide for the
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1 establishment and maintenance of such an official as will

2 carry out with respect to that State the functions other3 wise provided under subsection (a) by a Health Insurance

4 Ombudsman.

5 ‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—There

6 are authorized to be appropriated to the Secretary such

7 amounts as may be necessary to provide for grants to

8 States to establish and operate Health Insurance Ombuds9 men under subsection (a) or for the operation of Ombuds10 men under subsection (b).

11 ‘‘SUBPART 5—PROTECTION OF PROVIDERS AGAINST IN12 TERFERENCE WITH MEDICAL COMMUNICATIONS

13 AND IMPROPER INCENTIVE ARRANGEMENTS

14 ‘‘SEC. 2787. PROHIBITION OF INTERFERENCE WITH CER15 TAIN MEDICAL COMMUNICATIONS.

16 ‘‘(a) PROHIBITION.—

17 ‘‘(1) GENERAL RULE.—The provisions of any

18 contract or agreement, or the operation of any con19 tract or agreement, between a health insurance is20 suer in relation to health insurance coverage (includ21 ing any partnership, association, or other organiza22 tion that enters into or administers such a contract

23 or agreement) and a health care provider (or group
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1 of health care providers) shall not prohibit or re2 strict the provider from engaging in medical commu3 nications with the provider’s patient.

4 ‘‘(2) NULLIFICATION.—Any contract provision

5 or agreement described in paragraph (1) shall be

6 null and void.

7 ‘‘(3) PROHIBITION ON PROVISIONS.—A contract

8 or agreement described in paragraph (1) shall not

9 include a provision that violates paragraph (1).

10 ‘‘(b) RULES OF CONSTRUCTION.—Nothing in this

11 section shall be construed—

12 ‘‘(1) to prohibit the enforcement, as part of a

13 contract or agreement to which a health care pro14 vider is a party, of any mutually agreed upon terms

15 and conditions, including terms and conditions re16 quiring a health care provider to participate in, and

17 cooperate with, all programs, policies, and proce18 dures developed or operated by a health insurance

19 issuer to assure, review, or improve the quality and

20 effective utilization of health care services (if such

21 utilization is according to guidelines or protocols

22 that are based on clinical or scientific evidence and

23 the professional judgment of the provider) but only

24 if the guidelines or protocols under such utilization
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1 do not prohibit or restrict medical communications

2 between providers and their patients; or

3 ‘‘(2) to permit a health care provider to mis4 represent the scope of benefits covered under health

5 insurance coverage or to otherwise require a health

6 insurance issuer to reimburse providers for benefits

7 not covered under the coverage.

8 ‘‘(c) PROTECTION OF RELIGIOUS OR MORAL EX9 PRESSION.—

10 ‘‘(1) IN GENERAL.—An health insurance issuer

11 may fully advise—

12 ‘‘(A) licensed or certified health care pro13 viders at the time of their employment with the

14 issuer or at any time during such employment,

15 or

16 ‘‘(B) enrollees at the time of their enroll17 ment for health insurance coverage with the is18 suer or at any time during which such enrollees

19 have such coverage,

20 of the coverage’s limitations on providing particular

21 medical services (including limitations on referrals

22 for care provided outside of the coverage) based on

23 the religious or moral convictions of the issuer.

24 ‘‘(2) HEALTH CARE PROVIDERS.—Nothing in

25 this section shall be construed to alter the rights and
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1 duties of a health care provider to determine what

2 medical communications are appropriate with re3 spect to each patient, except as provided for in sub4 section (a).

5 ‘‘(d) MEDICAL COMMUNICATION DEFINED.—

6 ‘‘(1) IN GENERAL.—In this section, the term

7 ‘medical communication’ means any communication

8 made by a health care provider with a patient of the

9 health care provider (or the guardian or legal rep10 resentative of such patient) with respect to—

11 ‘‘(A) the patient’s health status, medical

12 care, or treatment options;

13 ‘‘(B) any utilization review requirements

14 that may affect treatment options for the pa15 tient; or

16 ‘‘(C) any financial incentives that may af17 fect the treatment of the patient.

18 ‘‘(2) MISREPRESENTATION.—The term ‘medical

19 communication’ does not include a communication

20 by a health care provider with a patient of the

21 health care provider (or the guardian or legal rep22 resentative of such patient) if the communication in23 volves a knowing or willful misrepresentation by

24 such provider.
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1 ‘‘SEC. 2788. PROHIBITION AGAINST TRANSFER OF INDEM2 NIFICATION OR IMPROPER INCENTIVE AR3 RANGEMENTS.

4 ‘‘(a) PROHIBITION OF TRANSFER OF INDEMNIFICA5 TION.—No contract or agreement between a health insur6 ance issuer (or any agent acting on behalf of such an is7 suer) and a health care provider shall contain any clause

8 purporting to transfer to the health care provider by in9 demnification or otherwise any liability relating to activi10 ties, actions, or omissions of the issuer or agent (as op11 posed to the provider).

12 ‘‘(b) PROHIBITION OF IMPROPER PHYSICIAN INCEN13 TIVE PLANS.—

14 ‘‘(1) IN GENERAL.—A health insurance issuer

15 offering health insurance coverage may not operate

16 any physician incentive plan unless the following re17 quirements are met:

18 ‘‘(A) No specific payment is made directly

19 or indirectly by the issuer to a physician or

20 physician group as an inducement to reduce or

21 limit medically necessary services provided with

22 respect to a specific individual enrolled with the

23 issuer.
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1 ‘‘(B) If the plan places a physician or phy2 sician group at substantial financial risk (as de3 termined by the Secretary) for services not pro4 vided by the physician or physician group, the

5 issuer—

6 ‘‘(i) provides stop-loss protection for

7 the physician or group that is adequate

8 and appropriate, based on standards devel9 oped by the Secretary that take into ac10 count the number of physicians placed at

11 such substantial financial risk in the group

12 or under the plan and the number of indi13 viduals enrolled with the issuer who receive

14 services from the physician or the physi15 cian group, and

16 ‘‘(ii) conducts periodic surveys of both

17 individuals enrolled and individuals pre18 viously enrolled with the issuer to deter19 mine the degree of access of such individ20 uals to services provided by the issuer and

21 satisfaction with the quality of such serv22 ices.
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1 ‘‘(C) The issuer provides the applicable

2 State authority (or the Secretary if such au3 thority is implementing this section) with de4 scriptive information regarding the plan, suffi5 cient to permit the authority (or the Secretary

6 in such case) to determine whether the plan is

7 in compliance with the requirements of this

8 paragraph.

9 ‘‘(2) PHYSICIAN INCENTIVE PLAN DEFINED.—

10 In this section, the term ‘physician incentive plan’

11 means any compensation arrangement between a

12 health insurance issuer and a physician or physician

13 group that may directly or indirectly have the effect

14 of reducing or limiting services provided with respect

15 to individuals enrolled with the issuer.

16 ‘‘(3) APPLICATION OF MEDICARE RULES.—The

17 Secretary shall provide for the application of rules

18 under this subsection that are substantially the same

19 as the rules established to carry out section

20 1876(i)(8) of the Social Security Act.

21 ‘‘SUBPART 6—PROMOTING GOOD MEDICAL PRACTICE

22 AND PROTECTING THE DOCTOR-PATIENT RELATIONSHIP

23 ‘‘SEC. 2789. PROMOTING GOOD MEDICAL PRACTICE.

24 ‘‘(a) PROHIBITING ARBITRARY LIMITATIONS OR

25 CONDITIONS FOR THE PROVISION OF SERVICES.—A
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1 health insurance issuer, in connection with the provision

2 of health insurance coverage, may not impose limits on

3 the manner in which particular services are delivered if

4 the services are medically necessary and appropriate for

5 the treatment or diagnosis of an illness or injury to the

6 extent that such treatment or diagnosis is otherwise a cov7 ered benefit.

8 ‘‘(b) MEDICAL NECESSITY AND APPROPRIATENESS

9 DEFINED.—In subsection (a), the term ‘medically nec10 essary and appropriate’ means, with respect to a service

11 or benefit, a service or benefit determined by the treating

12 physician participating in the health insurance coverage

13 after consultation with the enrollee, to be required, accord14 ingly to generally accepted principles of good medical prac15 tice, for the diagnosis or direct care and treatment of an

16 illness or injury of the enrollee.

17 ‘‘(c) CONSTRUCTION.—Subsection (a) shall not be

18 construed as requiring coverage of particular services the

19 coverage of which is otherwise not covered under the terms

20 of the coverage.’’.

21 (b) APPLICATION TO GROUP HEALTH INSURANCE

22 COVERAGE.—Subpart 2 of part A of title XXVII of the

23 Public Health Service Act is amended by adding at the

24 end the following new section:
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1 ‘‘SEC. 2706. PATIENT PROTECTION STANDARDS.

2 ‘‘Each health insurance issuer shall comply with pa3 tient protection requirements under part C with respect

4 to group health insurance coverage it offers.’’.

5 (c) APPLICATION TO INDIVIDUAL HEALTH INSUR6 ANCE COVERAGE.—Part B of title XXVII of the Public

7 Health Service Act is amended by inserting after section

8 2751 the following new section:

9 ‘‘SEC. 2752. PATIENT PROTECTION STANDARDS.

10 ‘‘Each health insurance issuer shall comply with pa11 tient protection requirements under part C with respect

12 to individual health insurance coverage it offers.’’.

13 (d) MODIFICATION OF PREEMPTION STANDARDS.—

14 (1) GROUP HEALTH INSURANCE COVERAGE.—

15 Section 2723 of such Act (42 U.S.C. 300gg–23) is

16 amended—

17 (A) in subsection (a)(1), by striking ‘‘sub18 section (b)’’ and inserting ‘‘subsections (b) and

19 (c)’’;

20 (B) by redesignating subsections (c) and

21 (d) as subsections (d) and (e), respectively; and

22 (C) by inserting after subsection (b) the

23 following new subsection:

24 ‘‘(c) SPECIAL RULES IN CASE OF PATIENT PROTEC25 TION REQUIREMENTS.—Subject to subsection (a)(2), the

26 provisions of section 2706 and part C (other than section
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1 2771), and part D insofar as it applies to section 2706

2 or part C, shall not prevent a State from establishing re3 quirements relating to the subject matter of such provi4 sions (other than section 2771) so long as such require5 ments are at least as stringent on health insurance issuers

6 as the requirements imposed under such provisions. Sub7 section (a) shall apply to the provisions of section 2771

8 (and section 2706 insofar as it relates to such section).’’.

9 (2) INDIVIDUAL HEALTH INSURANCE COV10 ERAGE.—Section 2762 of such Act (42 U.S.C.

11 300gg–62), as added by section 605(b)(3)(B) of

12 Public Law 104–204, is amended—

13 (A) in subsection (a), by striking ‘‘sub14 section (b), nothing in this part’’ and inserting

15 ‘‘subsections (b) and (c)’’, and

16 (B) by adding at the end the following new

17 subsection:

18 ‘‘(c) SPECIAL RULES IN CASE OF MANAGED CARE

19 REQUIREMENTS.—Subject to subsection (b), the provi20 sions of section 2752 and part C (other than section

21 2771), and part D insofar as it applies to section 2752
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1 or part C, shall not prevent a State from establishing re2 quirements relating to the subject matter of such provi3 sions so long as such requirements are at least as strin4 gent on health insurance issuers as the requirements im5 posed under such section. Subsection (a) shall apply to

6 the provisions of section 2771 (and section 2752 insofar

7 as it relates to such section).’’.

8 (e) ADDITIONAL CONFORMING AMENDMENTS.—

9 (1) Section 2723(a)(1) of such Act (42 U.S.C.

10 300gg–23(a)(1)) is amended by striking ‘‘part C’’

11 and inserting ‘‘parts C and D’’.

12 (2) Section 2762(b)(1) of such Act (42 U.S.C.

13 300gg–62(b)(1)) is amended by striking ‘‘part C’’

14 and inserting ‘‘part D’’.

15 (f) EFFECTIVE DATES.—(1)(A) Subject to subpara16 graph (B), the amendments made by subsections (a), (b),

17 (d)(1), and (e) shall apply with respect to group health

18 insurance coverage for group health plan years beginning

19 on or after July 1, 1998 (in this subsection referred to

20 as the ‘‘general effective date’’) and also shall apply to

21 portions of plan years occurring on and after January 1,

22 1999.
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1 (B) In the case of group health insurance coverage

2 provided pursuant to a group health plan maintained pur3 suant to 1 or more collective bargaining agreements be4 tween employee representatives and 1 or more employers

5 ratified before the date of enactment of this Act, the

6 amendments made by subsections (a), (b), (d)(1), and (e)

7 shall not apply to plan years beginning before the later

8 of—

9 (i) the date on which the last collective bargain10 ing agreements relating to the plan terminates (de11 termined without regard to any extension thereof

12 agreed to after the date of enactment of this Act),

13 or

14 (ii) the general effective date.

15 For purposes of clause (i), any plan amendment made pur16 suant to a collective bargaining agreement relating to the

17 plan which amends the plan solely to conform to any re18 quirement added by subsection (a) or (b) shall not be

19 treated as a termination of such collective bargaining

20 agreement.

21 (2) The amendments made by subsections (a), (c),

22 (d)(2), and (e) shall apply with respect to individual health

23 insurance coverage offered, sold, issued, renewed, in effect,
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1 or operated in the individual market on or after the gen2 eral effective date.

Æ