II 

116TH CONGRESS 

1ST SESSION S. 1261 

To provide for the establishment of Medicare part E public health plans, 

and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

MAY 1, 2019 

Mr. MERKLEY (for himself, Mr. MURPHY, Mrs. FEINSTEIN, Ms. HARRIS, Mr. 

BLUMENTHAL, Mr. SCHATZ, Ms. BALDWIN, Mr. DURBIN, Mr. REED, Ms. 

SMITH, Mrs. SHAHEEN, Ms. DUCKWORTH, Mr. BOOKER, Mrs. GILLIBRAND, and Mr. HEINRICH) introduced the following bill; which was read 

twice and referred to the Committee on Finance 

A BILL 

To provide for the establishment of Medicare part E public 

health plans, and for other purposes. 

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. 

4 This Act may be cited as the ‘‘Choose Medicare Act’’. 

5 SEC. 2. PUBLIC HEALTH PLAN. 

6 The Social Security Act is amended by adding at the 

7 end the following: 

8 ‘‘TITLE XXII—MEDICARE PART E PUBLIC HEALTH PLANS

9 ‘‘SEC. 2201. PUBLIC HEALTH PLANS.— 


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1 ‘‘(a) ESTABLISHMENT.—The Secretary shall estab2 lish public health plans (to be known as ‘Medicare part 

3 E plans’) that are available in the individual market, small 

4 group market, and large group market. 

5 ‘‘(b) BENEFITS.— 

6 ‘‘(1) IN GENERAL.—Each Medicare part E 

7 plan, regardless of whether the plan is offered in the 

8 individual market, small group market, or large 

9 group market, shall be a qualified health plan within 

10 the meaning of section 1301(a) of the Patient Pro11 tection and Affordable Care Act (42 U.S.C. 

12 18021(a)) that— 

13 ‘‘(A) meets all requirements applicable to 

14 qualified health plans under subtitle D of title 

15 I of the Patient Protection and Affordable Care 

16 Act (42 U.S.C. 18021 et seq.) (other than the 

17 requirement under section 1301(a)(1)(C)(ii) of 

18 such Act) and title XXVII of the Public Health 

19 Service Act (42 U.S.C. 300gg et seq.); 

20 ‘‘(B) provides coverage of— 

21 ‘‘(i) the essential health benefits de22 scribed in section 1302(b) of the Patient 

23 Protection and Affordable Care Act (42 

24 U.S.C. 18022(b)); and 


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1 ‘‘(ii) all items and services for which 

2 benefits are available under title XVIII; 

3 ‘‘(C) provides gold-level coverage described 

4 in section 1302(d)(1)(C) of the Patient Protec5 tion and Affordable Care Act (42 U.S.C. 

6 18022(d)(1)(C)); and 

7 ‘‘(D) provides coverage of abortions and all 

8 other reproductive services. 

9 ‘‘(2) PREEMPTION.—Notwithstanding section 

10 1303(a)(1) of the Patient Protection and Affordable 

11 Care Act (42 U.S.C. 18023(a)(1))— 

12 ‘‘(A) a State may not prohibit a Medicare 

13 part E plan from offering the coverage de14 scribed in paragraph (1)(D); and 

15 ‘‘(B) no State law that would prohibit such 

16 a plan from offering such coverage shall apply 

17 to such plan. 

18 ‘‘(c) ELIGIBILITY; ENROLLMENT.— 

19 ‘‘(1) AVAILABILITY ON THE EXCHANGES.—The 

20 Medicare part E plans offered in the individual and 

21 small group markets shall be offered through the 

22 Federal and State Exchanges, including the Small 

23 Business Health Options Program Exchanges (com24 monly referred to as the ‘SHOP Exchanges’). 

25 ‘‘(2) ELIGIBILITY.— 


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1 ‘‘(A) IN GENERAL.—Any individual who is 

2 a resident of the United States, as determined 

3 by the Secretary under subparagraph (C), and 

4 who is not an individual described in subpara5 graph (B), is eligible to enroll in a Medicare 

6 part E plan. 

7 ‘‘(B) EXCLUSIONS.—An individual de8 scribed in this subparagraph is any individual 

9 who is— 

10 ‘‘(i) entitled to, or enrolled for, bene11 fits under title XVIII; 

12 ‘‘(ii) eligible for medical assistance 

13 under a State plan under title XIX; or 

14 ‘‘(iii) enrolled for child health assist15 ance or pregnancy-related assistance under 

16 a State plan under title XXI. 

17 ‘‘(C) REGULATIONS.—The Secretary shall 

18 promulgate a rule for determining residency for 

19 purposes of subparagraph (A). 

20 ‘‘(3) EMPLOYER-SPONSORED PLANS.— 

21 ‘‘(A) EMPLOYER ENROLLMENT.—Effective 

22 with respect to the first plan year that begins 

23 1 year after the date of enactment of the 

24 Choose Medicare Act and each plan year there25 after, the Secretary shall provide options for 


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1 Medicare part E plans in the small group mar2 ket and large group market that are voluntary, 

3 and available to all employers. 

4 ‘‘(B) GROUP HEALTH PLANS.—The Sec5 retary, acting through the Administrator for the 

6 Centers for Medicare & Medicaid Services, at 

7 the request of a plan sponsor, shall serve as a 

8 third-party administrator of a group health 

9 plan that is a Medicare part E plan offered by 

10 such sponsor. 

11 ‘‘(C) PORTABILITY FOR EMPLOYER-SPON12 SORED PLANS.—The Secretary shall develop a 

13 process for allowing individuals enrolled in a 

14 Medicare part E plan offered in the small group 

15 market or large group market to maintain 

16 health insurance coverage through a Medicare 

17 part E plan if the individual subsequently loses 

18 eligibility for enrollment in such a plan based 

19 on termination of the employment relationship. 

20 The ability to maintain such coverage shall 

21 exist regardless of whether the individual has 

22 the option to enroll in other health insurance 

23 coverage, including coverage offered in the indi24 vidual market or through a subsequent em25 ployer. 


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1 ‘‘(d) PREMIUMS.—The Secretary shall establish pre2 mium rates for the Medicare part E plans that— 

3 ‘‘(1) are adjusted based on— 

4 ‘‘(A) whether the plan is offered in the in5 dividual market, small group market, or large 

6 group market; and 

7 ‘‘(B) the applicable rating area; 

8 ‘‘(2) are at a level sufficient to fully finance— 

9 ‘‘(A) the costs of health benefits provided 

10 by such plans; and 

11 ‘‘(B) administrative costs related to oper12 ating the plans; and 

13 ‘‘(3) comply with the requirements under sec14 tion 2701 of the Public Health Service Act, includ15 ing for such plans that are offered in the large 

16 group market. 

17 ‘‘(e) PROVIDERS AND REIMBURSEMENT RATES.— 

18 ‘‘(1) IN GENERAL.—The Secretary shall estab19 lish a rate schedule for reimbursing types of health 

20 care providers furnishing items and services under 

21 the Medicare part E plans at rates that are con22 sistent with the negotiations described in paragraph 

23 (2) and are necessary to maintain network adequacy. 

24 ‘‘(2) MANNER OF NEGOTIATION.—The Sec25 retary shall negotiate the rates described in paraVerDate Sep 11 2014 20:12 May 07, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S1261.IS S1261

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1 graph (1) in a manner that results in payment rates 

2 that are not lower, in the aggregate, than rates 

3 under title XVIII, and not higher, in the aggregate, 

4 than the average rates paid by other health insur5 ance issuers offering health insurance coverage 

6 through an Exchange. 

7 ‘‘(3) PARTICIPATING PROVIDERS.— 

8 ‘‘(A) IN GENERAL.—A health care provider 

9 that is a participating provider of services or 

10 supplier under the Medicare program under 

11 title XVIII on the date of enactment of Choose 

12 Medicare Act shall be a participating provider 

13 for Medicare part E plans. 

14 ‘‘(B) ADDITIONAL PROVIDERS.—The Sec15 retary shall establish a process to allow health 

16 care providers not described in subparagraph 

17 (A) to become participating providers for Medi18 care part E plans. 

19 ‘‘(4) LIMITATIONS ON BALANCE BILLING.—The 

20 limitations on balance billing pursuant to the provi21 sions of section 1866(a)(1)(A) of the Social Security 

22 Act (42 U.S.C. 1395cc(a)(1)(A)) shall apply to par23 ticipating providers for Medicare part E plans in the 

24 same manner as such provisions apply to partici25 pating providers under the Medicare program. 


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1 ‘‘(f) ENCOURAGING USE OF ALTERNATIVE PAYMENT

2 MODELS.—The Secretary shall, as applicable, utilize alter3 native payment models, including those described in sec4 tion 1833(z)(3)(C), as added by section 101(e)(2) of the 

5 Medicare Access and CHIP Reauthorization Act of 2015 

6 (Public Law 114–10), in making payments for items and 

7 services (including prescription drugs) furnished under 

8 Medicare part E plans. The payment rates under such al9 ternative payment models shall comply with the require10 ment for negotiated rates under subsection (e)(2). 

11 ‘‘(g) PRESCRIPTION DRUGS.—The Secretary shall 

12 apply the provisions of section 1860D–11(i) to prescrip13 tion drugs under Medicare part E plans in the same man14 ner as such provisions apply with respect to applicable cov15 ered part D drugs under such section. 

16 ‘‘(h) APPROPRIATIONS.— 

17 ‘‘(1) START UP FUNDING.—For purposes of es18 tablishing the Medicare part E plans, there is appro19 priated to the Secretary, out of any funds in the 

20 Treasury not otherwise obligated, $2,000,000,000, 

21 for fiscal year 2020. 

22 ‘‘(2) INITIAL RESERVES.—There is appro23 priated to the Secretary, out of any funds in the 

24 Treasury not otherwise obligated, such sums as may 

25 be necessary, based on projected enrollment in the 


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1 Medicare part E plans in the first plan year in 

2 which such plans are offered, to provide reserves for 

3 the purpose of paying claims filed during the initial 

4 90-day period of such plan year. 

5 ‘‘(3) CLARIFICATION.—Any provision of law re6 stricting the use of Federal funds with respect to 

7 any reproductive health service shall not apply to 

8 funds appropriated under paragraph (1) or (2). 

9 ‘‘(i) HEALTH INSURANCE ISSUER.—With respect to 

10 any Medicare part E plan, the Secretary shall be consid11 ered a health insurance issuer, within the meaning of sec12 tion 2791(b) of the Public Health Service Act.’’. 

13 SEC. 3. NOTICE AND NAVIGATOR REFERRAL FOR EMPLOY14 EES UNDER THE FAIR LABOR STANDARDS 

15 ACT OF 1938. 

16 (a) IN GENERAL.—Section 18B of the Fair Labor 

17 Standards Act of 1938 (29 U.S.C. 218b) is amended— 

18 (1) in the heading, by striking ‘‘TO’’ and insert19 ing ‘‘AND NAVIGATOR REFERRAL FOR’’; 

20 (2) by redesignating subsection (b) as sub21 section (c); 

22 (3) by inserting after subsection (a) the fol23 lowing: 

24 ‘‘(b) NAVIGATOR REFERRAL.— 


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1 ‘‘(1) IN GENERAL.—An employer described in 

2 paragraph (3) shall refer each full-time employee (as 

3 defined in section 4980H of the Internal Revenue 

4 Code of 1986) to— 

5 ‘‘(A) an entity that serves as a navigator 

6 under section 1311(i) of the Patient Protection 

7 and Affordable Care Act (42 U.S.C. 18031(i)) 

8 for the Exchange operating in the State of the 

9 employer; or 

10 ‘‘(B) if the Exchange operating in the 

11 State of the employer does not have an entity 

12 serving as such a navigator, another entity that 

13 shall carry out equivalent activities as such a 

14 navigator. 

15 ‘‘(2) REFERRAL.—The referral described in 

16 paragraph (1) shall occur— 

17 ‘‘(A) at the time the employer hires the 

18 employee; or 

19 ‘‘(B) on the effective date described in sub20 section (c)(2) with respect to an employee who 

21 is currently employed by the employer on such 

22 date. 

23 ‘‘(3) EMPLOYER.—An employer described in 

24 this paragraph is any employer that— 


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1 ‘‘(A) does not provide an eligible employer2 sponsored plan as defined in section 

3 5000A(f)(2) of the Internal Revenue Code of 

4 1986; or 

5 ‘‘(B) provides such an eligible employer6 sponsored plan, but the plan is determined 

7 under section 36B(c)(2)(C) of such Code— 

8 ‘‘(i) to be unaffordable to the em9 ployee; or 

10 ‘‘(ii) to not provide the required min11 imum actuarial value.’’; and 

12 (4) in subsection (c), as so redesignated— 

13 (A) in the heading, by striking ‘‘EFFEC14 TIVE DATE’’ and inserting ‘‘EFFECTIVE

15 DATES’’; 

16 (B) by striking ‘‘Subsection (a)’’ and in17 serting the following: 

18 ‘‘(1) NOTICE.—Subsection (a);’’; and 

19 (C) by adding at the end the following: 

20 ‘‘(2) NAVIGATOR REFERRAL.—Subsection (b) 

21 shall take effect with respect to employers in a State 

22 beginning on the date that is 2 years after the date 

23 of enactment of the Choose Medicare Act.’’. 

24 (b) STUDY.—Not later than January 1, 2024, the 

25 Comptroller General of the United States shall conduct 


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1 a study on the impact of the requirements under section 

2 18B of the Fair Labor Standards Act of 1938 (29 U.S.C. 

3 218b), including the amendments made by subsection (a), 

4 on the rate of individuals without minimum essential cov5 erage as defined in section 5000A of the Internal Revenue 

6 Code of 1986 in the United States and in each State. 

7 (c) FUNDING FOR NAVIGATOR PROGRAM.—Section 

8 1311(i)(6) of the Patient Protection and Affordable Care 

9 Act (42 U.S.C. 18031(i)(6)) is amended— 

10 (1) by striking ‘‘Grants’’ and inserting the fol11 lowing: 

12 ‘‘(A) IN GENERAL.—Grants’’; and 

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

14 ‘‘(B) AUTHORIZATION OF APPROPRIA15 TIONS.—There is authorized to be appropriated 

16 such sums as may be necessary to address ca17 pacity limitations of entities serving as naviga18 tors through a grant under this subsection.’’. 

19 SEC. 4. PROTECTING AGAINST HIGH OUT-OF-POCKET EX20 PENDITURES FOR MEDICARE FEE-FOR-SERV21 ICE BENEFITS. 

22 Title XVIII of the Social Security Act (42 U.S.C. 

23 1395 et seq.) is amended by adding at the end the fol24 lowing new section: 


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1 ‘‘PROTECTION AGAINST HIGH OUT-OF-POCKET

2 EXPENDITURES

3 ‘‘SEC. 1899C. (a) IN GENERAL.—Notwithstanding 

4 any other provision of this title, in the case of an indi5 vidual entitled to, or enrolled for, benefits under part A 

6 or enrolled in part B, if the amount of the out-of-pocket 

7 cost-sharing of such individual for a year (beginning with 

8 2021) equals or exceeds the annual out-of-pocket limit 

9 under subsection (b) for that year, the individual shall not 

10 be responsible for additional out-of-pocket cost-sharing in11 curred during that year. 

12 ‘‘(b) ANNUAL OUT-OF-POCKET LIMIT.— 

13 ‘‘(1) IN GENERAL.—The amount of the annual 

14 out-of-pocket limit under this subsection shall be— 

15 ‘‘(A) for 2021, $6,700; or 

16 ‘‘(B) for a subsequent year, the amount 

17 specified in this subsection for the preceding 

18 year increased or decreased by the percentage 

19 change in the medical care component of the 

20 Consumer Price Index for All Urban Con21 sumers for the 12-month period ending with 

22 June of such preceding year. 

23 ‘‘(2) ROUNDING.—If any amount determined 

24 under paragraph (1)(B) is not a multiple of $5, such 


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1 amount shall be rounded to the nearest multiple of 

2 $5. 

3 ‘‘(c) OUT-OF-POCKET COST-SHARING DEFINED.— 

4 ‘‘(1) IN GENERAL.—Subject to paragraphs (2) 

5 and (3), in this section, the term ‘out-of-pocket cost6 sharing’ means, with respect to an individual, the 

7 amount of the expenses incurred by the individual 

8 that are attributable to— 

9 ‘‘(A) deductibles, coinsurance, and copay10 ments applicable under part A or B; or 

11 ‘‘(B) for items and services that would 

12 have otherwise been covered under part A or B 

13 but for the exhaustion of those benefits. 

14 ‘‘(2) CERTAIN COSTS NOT INCLUDED.— 

15 ‘‘(A) NON-COVERED ITEMS AND SERV16 ICES.—Expenses incurred for items and serv17 ices which are not covered under part A or B 

18 shall not be considered incurred expenses for 

19 purposes of determining out-of-pocket cost20 sharing under paragraph (1). 

21 ‘‘(B) ITEMS AND SERVICES NOT FUR22 NISHED ON AN ASSIGNMENT-RELATED BASIS.— 

23 If an item or service is furnished to an indi24 vidual under this title and is not furnished on 

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1 penses the individual incurs above the amount 

2 the individual would have incurred if the item 

3 or service was furnished on an assignment-re4 lated basis shall not be considered incurred ex5 penses for purposes of determining out-of-pock6 et cost-sharing under paragraph (1). 

7 ‘‘(3) SOURCE OF PAYMENT.—For purposes of 

8 paragraph (1), the Secretary shall consider expenses 

9 to be incurred by the individual without regard to 

10 whether the individual or another person, including 

11 a State program, an employer, a Medicare supple12 mental policy, or other third-party coverage, has 

13 paid for such expenses. 

14 ‘‘(d) ANNOUNCEMENT OF THE ANNUAL OUT-OF15 POCKET LIMIT.—The Secretary shall (beginning in 2020) 

16 announce (in a manner intended to provide notice to all 

17 interested parties) the annual out-of-pocket limit under 

18 this section that will be applicable for the succeeding 

19 year.’’. 

20 SEC. 5. NEGOTIATING FAIR PRICES FOR MEDICARE PRE21 SCRIPTION DRUGS. 

22 (a) IN GENERAL.—Section 1860D–11 of the Social 

23 Security Act (42 U.S.C. 1395w–111) is amended by strik24 ing subsection (i) (relating to noninterference) and by in25 serting the following: 


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1 ‘‘(i) NEGOTIATING FAIR PRICES WITH DRUG MANU2 FACTURERS.— 

3 ‘‘(1) IN GENERAL.—Notwithstanding any other 

4 provision of law, in furtherance of the goals of pro5 viding quality care and containing costs under this 

6 part, the Secretary shall, with respect to applicable 

7 covered part D drugs, and may, with respect to 

8 other covered part D drugs, negotiate, using the ne9 gotiation technique or techniques that the Secretary 

10 determines will maximize savings and value to the 

11 government for prescription drug plans and MA–PD 

12 plans and for plan enrollees (in a manner that may 

13 be similar to Federal entities and that may include, 

14 but is not limited to, formularies, reference pricing, 

15 discounts, rebates, other price concessions, and cov16 erage determinations), with drug manufacturers the 

17 prices that may be charged to PDP sponsors and 

18 MA organizations for such drugs for part D eligible 

19 individuals who are enrolled in a prescription drug 

20 plan or in an MA–PD plan. In conducting such ne21 gotiations, the Secretary shall consider the drug’s 

22 current price, initial launch price, prevalence of dis23 ease and usage, and approved indications, the num24 ber of similarly effective alternative treatments for 

25 each approved use of the drug, the budgetary impact 


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1 of providing coverage under this part for such drug 

2 for all individuals who would likely benefit from the 

3 drug, evidence on the drug’s effectiveness and safety 

4 compared to similar drugs, and the quality and 

5 quantity of clinical data and rigor of the applicable 

6 process of approval of a drug under section 505 of 

7 the Federal Food, Drug, and Cosmetic Act or a bio8 logical product under section 351 of the Public 

9 Health Service Act. 

10 ‘‘(2) USE OF LOWER OF VA OR BIG FOUR PRICE

11 IF NEGOTIATIONS FAIL.—If, after attempting to ne12 gotiate for a price with respect to a covered part D 

13 drug under paragraph (1) for a period of 1 year, the 

14 Secretary is not successful in obtaining an appro15 priate price for the drug (as determined by the Sec16 retary), the Secretary shall establish the price that 

17 may be charged to PDP sponsors and MA organiza18 tions for such drug for part D eligible individuals 

19 who are enrolled in a prescription drug plan or in 

20 an MA–PD plan at an amount equal to the lesser 

21 of— 

22 ‘‘(A) the price paid by the Secretary of 

23 Veterans Affairs to procure the drug under the 

24 laws administered by the Secretary of Veterans 

25 Affairs; or 


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1 ‘‘(B) the price paid to procure the drug 

2 under section 8126 of title 38, United States 

3 Code. 

4 ‘‘(3) APPLICABLE COVERED PART D DRUG DE5 FINED.—For purposes of this subsection, the term 

6 ‘applicable covered part D drug’ means a covered 

7 part D drug that the Secretary determines to be ap8 propriate for negotiation under paragraph (1) based 

9 on one or more of the following factors as applied 

10 to such drug: 

11 ‘‘(A) Spending on a per beneficiary basis. 

12 ‘‘(B) The proportion of total spending 

13 under this title. 

14 ‘‘(C) Unit price increases over the pre15 ceding 5 years. 

16 ‘‘(D) Initial launch price. 

17 ‘‘(E) Availability of less expensive, simi18 larly effective alternative treatments. 

19 ‘‘(F) Status of the drug as a follow-on to 

20 previously approved drugs. 

21 ‘‘(G) Any other criteria determined by the 

22 Secretary. 

23 ‘‘(4) PDP SPONSORS AND MA ORGANIZATION

24 MAY NEGOTIATE LOWER PRICES.—Nothing in this 

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1 sor of a prescription drug plan, or an organization 

2 offering an MA–PD plan, from obtaining a discount 

3 or reduction of the price for a covered part D drug 

4 below the price negotiated under paragraph (1) or 

5 the price established under paragraph (2). 

6 ‘‘(5) NO EFFECT ON EXISTING APPEALS PROC7 ESS.—Nothing in this subsection shall be construed 

8 to affect the appeals procedures under subsections 

9 (g) and (h) of section 1860D–4.’’. 

10 (b) EFFECTIVE DATE.—The amendments made by 

11 this section shall take effect on the date of the enactment 

12 of this Act and shall first apply to negotiations and prices 

13 for plan years beginning on January 1, 2020. 

14 SEC. 6. ENHANCEMENT OF PREMIUM ASSISTANCE CREDIT. 

15 (a) USE OF GOLD LEVEL PLAN FOR BENCHMARK.— 

16 (1) IN GENERAL.—Clause (i) of section 

17 36B(b)(2)(B) of the Internal Revenue Code of 1986 

18 is amended by striking ‘‘applicable second lowest 

19 cost silver plan’’ and inserting ‘‘applicable second 

20 lowest cost gold plan’’. 

21 (2) CONFORMING AMENDMENT RELATED TO

22 AFFORDABILITY.—Section 36B(c)(4)(C)(i)(I) of 

23 such Code is amended by striking ‘‘second lowest 

24 cost silver plan’’ and inserting ‘‘second lowest cost 

25 gold plan’’. 


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1 (3) OTHER CONFORMING AMENDMENTS.—Sub2 paragraphs (B) and (C) of section 36B(b)(3) of such 

3 Code are each amended by striking ‘‘silver plan’’ 

4 each place it appears in the text and the heading 

5 and inserting ‘‘gold plan’’. 

6 (b) EXPANSION OF ELIGIBILITY FOR REFUNDABLE

7 CREDITS FOR COVERAGE UNDER QUALIFIED HEALTH

8 PLANS.— 

9 (1) IN GENERAL.—Section 36B(c)(1)(A) of the 

10 Internal Revenue Code of 1986 is amended by strik11 ing ‘‘400 percent’’ and inserting ‘‘600 percent’’. 

12 (2) CONFORMING AMENDMENT.—The last line 

13 of the table contained in section 36B(b)(3)(A)(i) of 

14 such Code is amended by striking ‘‘400%’’ and in15 serting ‘‘600%’’. 

16 (3) CONFORMING AMENDMENTS RELATING TO

17 RECAPTURE OF EXCESS ADVANCED PAYMENTS.— 

18 Clause (i) of section 36B(f)(2)(B) of such Code is 

19 amended— 

20 (A) by striking ‘‘400 percent’’ and insert21 ing ‘‘600 percent’’; and 

22 (B) by striking ‘‘400%’’ in the table there23 in and inserting ‘‘600%’’. 


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1 (c) ELIMINATION OF FAILSAFE.—Section 

2 36B(b)(3)(A)(ii) of the Internal Revenue Code of 1986 is 

3 amended by striking subclause (III). 

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

5 this section shall apply to taxable years beginning after 

6 December 31, 2018. 

7 SEC. 7. ENHANCEMENTS FOR REDUCED COST SHARING. 

8 (a) DEFINITION OF ELIGIBLE INDIVIDUAL.—Section 

9 1402(b)(1) of the Patient Protection and Affordable Care 

10 Act (42 U.S.C. 1807(b)(1)) is amended by striking ‘‘silver 

11 level’’ and inserting ‘‘gold level’’. 

12 (b) MODIFICATION OF AMOUNT.— 

13 (1) IN GENERAL.—Section 1402(c)(2) of the 

14 Patient Protection and Affordable Care Act is 

15 amended to read as follows: 

16 ‘‘(2) ADDITIONAL REDUCTION.—The Secretary 

17 shall establish procedures under which the issuer of 

18 a qualified health plan to which this section applies 

19 shall further reduce cost-sharing under the plan in 

20 a manner sufficient to— 

21 ‘‘(A) in the case of an eligible insured 

22 whose household income is not less than 100 

23 percent but not more than 133 percent of the 

24 poverty line for a family of the size involved, in25 crease the plan’s share of the total allowed 


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1 costs of benefits provided under the plan to 94 

2 percent of such costs; 

3 ‘‘(B) in the case of an eligible insured 

4 whose household income is more than 133 per5 cent but not more than 150 percent of the pov6 erty line for a family of the size involved, in7 crease the plan’s share of the total allowed 

8 costs of benefits provided under the plan to 92 

9 percent of such costs; 

10 ‘‘(C) in the case of an eligible insured 

11 whose household income is more than 150 per12 cent but not more than 200 percent of the pov13 erty line for a family of the size involved, in14 crease the plan’s share of the total allowed 

15 costs of benefits provided under the plan to 90 

16 percent of such costs; 

17 ‘‘(D) in the case of an eligible insured 

18 whose household income is more than 200 per19 cent but not more than 300 percent of the pov20 erty line for a family of the size involved, in21 crease the plan’s share of the total allowed 

22 costs of benefits provided under the plan to 85 

23 percent of such costs; and 

24 ‘‘(E) in the case of an eligible insured 

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1 cent but not more than 400 percent of the pov2 erty line for a family of the size involved, in3 crease the plan’s share of the total allowed 

4 costs of benefits provided under the plan to 80 

5 percent of such costs.’’. 

6 (2) CONFORMING AMENDMENT.—Clause (i) of 

7 section 1402(c)(1)(B) of such Act is amended to 

8 read as follows: 

9 ‘‘(i) IN GENERAL.—The Secretary 

10 shall ensure the reduction under this para11 graph shall not result in an increase in the 

12 plan’s share of the total allowed costs of 

13 benefits provided under the plan above— 

14 ‘‘(I) 94 percent in the case of an 

15 eligible insured described in para16 graph (2)(A); 

17 ‘‘(II) 92 percent in the case of an 

18 eligible insured described in para19 graph (2)(B); 

20 ‘‘(III) 90 percent in the case of 

21 an eligible insured described in para22 graph (2)(C); 

23 ‘‘(IV) 85 percent in the case of 

24 an eligible insured described in para25 graph (2)(D); and 


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1 ‘‘(V) 80 percent in the case of an 

2 eligible insured described in para3 graph (2)(E).’’. 

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

5 this section shall apply to plan years beginning after De6 cember 31, 2019. 

7 SEC. 8. REINSURANCE AND AFFORDABILITY FUND. 

8 Part 5 of subtitle D of title I of the Patient Protec9 tion and Affordable Care Act is amended by inserting 

10 after section 1341 (42 U.S.C. 18061) the following: 

11 ‘‘SEC. 1341A. REINSURANCE AND AFFORDABILITY FUND 

12 FOR THE INDIVIDUAL MARKET IN EACH 

13 STATE. 

14 ‘‘(a) IN GENERAL.—The Secretary, in consultation 

15 with the National Association of Insurance Commis16 sioners, shall establish a program to enable each State, 

17 for any plan year beginning in the 3-year period beginning 

18 January 1, 2020, to— 

19 ‘‘(1) provide reinsurance payments to health in20 surance issuers with respect to individuals enrolled 

21 under individual health insurance coverage offered 

22 by such issuers; or 

23 ‘‘(2) provide assistance (other than through 

24 payments described in paragraph (1)) to reduce out25 of-pocket costs, such as copayments, coinsurance, 


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1 premiums, and deductibles, of individuals enrolled 

2 under qualified health plans offered in the individual 

3 market through an Exchange. 

4 ‘‘(b) APPROPRIATIONS.—There is appropriated, out 

5 of any money in the Treasury not otherwise appropriated, 

6 $30,000,000,000 for the period of fiscal years 2020 

7 through 2022 for purposes of establishing and admin8 istering the program established under this section. Such 

9 amount shall remain available until expended.’’. 

10 SEC. 9. EXPANDING RATING RULES TO LARGE GROUP MAR11 KET. 

12 (a) IN GENERAL.—Section 2701(a) of the Public 

13 Health Service Act (42 U.S.C. 300gg(a)) is amended— 

14 (1) in paragraph (1), by striking ‘‘small’’; and 

15 (2) by striking paragraph (5). 

16 (b) EFFECTIVE DATE.—The amendments made by 

17 subsection (a) shall apply to plans offered in the first plan 

18 year beginning after the date of enactment of this Act and 

19 any plan year thereafter. 

20 SEC. 10. PROTECTION OF CONSUMERS FROM EXCESSIVE, 

21 UNJUSTIFIED, OR UNFAIRLY DISCRIMINA22 TORY RATES. 

23 (a) PROTECTION FROM EXCESSIVE, UNJUSTIFIED, 

24 OR UNFAIRLY DISCRIMINATORY RATES.—The first sec25 tion 2794 of the Public Health Service Act (42 U.S.C. 


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1 300gg–94), as added by section 1003 of the Patient Pro2 tection and Affordable Care Act (Public Law 111–148), 

3 is amended by adding at the end the following new sub4 section: 

5 ‘‘(e) PROTECTION FROM EXCESSIVE, UNJUSTIFIED, 

6 OR UNFAIRLY DISCRIMINATORY RATES.— 

7 ‘‘(1) AUTHORITY OF STATES.—Nothing in this 

8 section shall be construed to prohibit a State from 

9 imposing requirements (including requirements re10 lating to rate review standards and procedures and 

11 information reporting) on health insurance issuers 

12 with respect to rates that are in addition to the re13 quirements of this section and are more protective of 

14 consumers than such requirements. 

15 ‘‘(2) CONSULTATION IN RATE REVIEW PROC16 ESS.—In carrying out this section, the Secretary 

17 shall consult with the National Association of Insur18 ance Commissioners and consumer groups. 

19 ‘‘(3) DETERMINATION OF WHO CONDUCTS RE20 VIEWS FOR EACH STATE.—The Secretary shall de21 termine, after the date of enactment of this sub22 section and periodically thereafter, the following: 

23 ‘‘(A) In which markets in each State the 

24 State insurance commissioner or relevant State 

25 regulator shall undertake the corrective actions 


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1 under paragraph (4), as a condition of the 

2 State receiving the grant in subsection (c), 

3 based on the Secretary’s determination that the 

4 State insurance commissioner or relevant State 

5 regulator is adequately undertaking and uti6 lizing such actions in that market. 

7 ‘‘(B) In which markets in each State the 

8 Secretary shall undertake the corrective actions 

9 under paragraph (4), in cooperation with the 

10 relevant State insurance commissioner or State 

11 regulator, based on the Secretary’s determina12 tion that the State is not adequately under13 taking and utilizing such actions in that mar14 ket. 

15 ‘‘(4) CORRECTIVE ACTION FOR EXCESSIVE, UN16 JUSTIFIED, OR UNFAIRLY DISCRIMINATORY

17 RATES.—In accordance with the process established 

18 under this section, the Secretary or the relevant 

19 State insurance commissioner or State regulator 

20 shall take corrective actions to ensure that any ex21 cessive, unjustified, or unfairly discriminatory rates 

22 are corrected prior to implementation, or as soon as 

23 possible thereafter, through mechanisms such as— 

24 ‘‘(A) denying rates; 

25 ‘‘(B) modifying rates; or 


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1 ‘‘(C) requiring rebates to consumers. 

2 ‘‘(5) NONCOMPLIANCE.—Failure to comply with 

3 any corrective action taken by the Secretary under 

4 this subsection may result in the application of civil 

5 monetary penalties and, if the Secretary determines 

6 appropriate, make the plan involved ineligible for 

7 classification as a qualified health plan.’’. 

8 (b) CLARIFICATION OF REGULATORY AUTHORITY.— 

9 Such section is further amended— 

10 (1) in subsection (a)— 

11 (A) in the subsection heading, by striking 

12 ‘‘PREMIUM’’ and inserting ‘‘RATE’’; 

13 (B) in paragraph (1), by striking ‘‘unrea14 sonable increases in premiums’’ and inserting 

15 ‘‘potentially excessive, unjustified, or unfairly 

16 discriminatory rates, including premiums,’’; and 

17 (C) in paragraph (2)— 

18 (i) by striking ‘‘an unreasonable pre19 mium increase’’ and inserting ‘‘a poten20 tially excessive, unjustified, or unfairly dis21 criminatory rate’’; 

22 (ii) by striking ‘‘the increase’’ and in23 serting ‘‘the rate’’; and 

24 (iii) by striking ‘‘such increases’’ and 

25 inserting ‘‘such rates’’; 


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1 (2) in subsection (b)— 

2 (A) in the subsection heading, by striking 

3 ‘‘PREMIUM’’ and inserting ‘‘RATE’’; 

4 (B) by striking ‘‘premium increases’’ each 

5 place it appears and inserting ‘‘rates’’; 

6 (C) in paragraph (1), in the paragraph 

7 heading, by striking ‘‘PREMIUM INCREASE’’ and 

8 inserting ‘‘RATE’’; and 

9 (D) in paragraph (2)— 

10 (i) in the paragraph heading, by strik11 ing ‘‘PREMIUM INCREASES’’ and inserting 

12 ‘‘RATES’’; and 

13 (ii) in subparagraph (B), by striking 

14 ‘‘premium’’ and inserting ‘‘rate’’; and 

15 (3) in subsection (c)(1)— 

16 (A) in the heading, by striking ‘‘PRE17 MIUM’’ and inserting ‘‘RATE’’; 

18 (B) by inserting ‘‘that satisfy the condition 

19 under subsection (e)(3)(A)’’ after ‘‘award 

20 grants to States’’; and 

21 (C) in subparagraph (A), by striking ‘‘pre22 mium increases’’ and inserting ‘‘rates’’. 

23 (c) CONFORMING AMENDMENTS.— 


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1 (1) PUBLIC HEALTH SERVICE ACT.—Title 

2 XXVII of the Public Health Service Act (42 U.S.C. 

3 300gg et seq.) is amended— 

4 (A) in section 2723 (42 U.S.C. 300gg– 

5 22)— 

6 (i) in subsection (a)— 

7 (I) in paragraph (1), by inserting 

8 ‘‘and section 2794 (relating to the 

9 reasonableness of rates with respect to 

10 health insurance coverage)’’ after 

11 ‘‘this part’’; and 

12 (II) in paragraph (2), by insert13 ing ‘‘or such section 2794’’ after ‘‘this 

14 part’’; and 

15 (ii) in subsection (b)— 

16 (I) in paragraph (1), by inserting 

17 ‘‘and section 2794 (relating to the 

18 reasonableness of rates with respect to 

19 health insurance coverage)’’ after 

20 ‘‘this part’’; and 

21 (II) in paragraph (2)— 

22 (aa) in subparagraph (A), 

23 by inserting ‘‘or such section 

24 2794 that is’’ after ‘‘this part’’; 

25 and 


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1 (bb) in subparagraph (C)(ii), 

2 by inserting ‘‘or such section 

3 2794’’ after ‘‘this part’’; and 

4 (B) in section 2761 (42 U.S.C. 300gg– 

5 61)— 

6 (i) in subsection (a)— 

7 (I) in paragraph (1), by inserting 

8 ‘‘and section 2794 (relating to the 

9 reasonableness of rates with respect to 

10 health insurance coverage)’’ after 

11 ‘‘this part’’; and 

12 (II) in paragraph (2)— 

13 (aa) by inserting ‘‘or such 

14 section 2794’’ after ‘‘set forth in 

15 this part’’; and 

16 (bb) by inserting ‘‘and such 

17 section 2794’’ after ‘‘the require18 ments of this part’’; and 

19 (ii) in subsection (b), by inserting 

20 ‘‘and such section 2794’’ after ‘‘this part’’. 

21 (2) PATIENT PROTECTION AND AFFORDABLE

22 CARE ACT.—Section 1311(e)(2) of the Patient Pro23 tection and Affordable Care Act (42 U.S.C. 

24 18031(e)(2)) is amended by striking ‘‘unjustified 


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1 premium increases’’ and inserting ‘‘unjustified 

2 rates’’. 

3 (d) APPLICABILITY TO GRANDFATHERED PLANS.— 

4 Section 1251(a)(4)(A) of the Patient Protection and Af5 fordable Care Act (42 U.S.C. 18011(a)(4)(A)) is amended 

6 by adding at the end the following: 

7 ‘‘(v) Section 2794 (relating to reason8 ableness of rates with respect to health in9 surance coverage).’’. 

10 (e) EFFECTIVE DATE.—The amendments made by 

11 this section shall take effect on the date of enactment of 

12 this Act and shall be implemented with respect to health 

13 plans beginning not later than January 1, 2020. 

14 SEC. 11. SENSE OF CONGRESS. 

15 It is the sense of the Congress that— 

16 (1) the Federal Government, acting in its ca17 pacity as an insurer, employer, or health care pro18 vider, should serve as a model for the Nation to en19 sure coverage of all reproductive services; and 

20 (2) all restrictions on coverage of reproductive 

21 services in the private insurance market should end. 

Æ 


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