II 

116TH CONGRESS 

1ST SESSION S. 1033 

To amend the Public Health Service Act to establish a public health insurance 

option, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

APRIL 4, 2019 

Mr. WHITEHOUSE (for himself, Mr. BROWN, Ms. BALDWIN, Mr. DURBIN, Mr. 

MENENDEZ, and Ms. HARRIS) introduced the following bill; which was 

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

and Pensions 

A BILL 

To amend the Public Health Service Act to establish a public 

health insurance option, 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 ‘‘Consumer Health Op5 tions and Insurance Competition Enhancement Act’’ or 

6 the ‘‘CHOICE Act’’. 


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1 SEC. 2. PUBLIC HEALTH INSURANCE OPTION. 

2 (a) IN GENERAL.—Part C of title XXVII of the Pub3 lic Health Service Act (42 U.S.C. 300gg–91) is amended 

4 by adding at the end the following: 

5 ‘‘SEC. 2795. PUBLIC HEALTH INSURANCE OPTION. 

6 ‘‘(a) ESTABLISHMENT.— 

7 ‘‘(1) IN GENERAL.—For plan years beginning 

8 in 2020, the Secretary shall establish, and provide 

9 for the offering through the Exchanges, of a quali10 fied health plan (in this Act referred to as the ‘pub11 lic health insurance option’) that provides value, 

12 choice, competition, and stability of affordable, high13 quality coverage throughout the United States in ac14 cordance with this section. 

15 ‘‘(2) PRIMARY RESPONSIBILITY.—In designing 

16 the public health insurance option, the primary re17 sponsibility of the Secretary shall be to create an af18 fordable health plan without compromising quality 

19 or access to care. 

20 ‘‘(b) ADMINISTRATING THE PUBLIC HEALTH INSUR21 ANCE OPTION.— 

22 ‘‘(1) OFFERED THROUGH EXCHANGES.— 

23 ‘‘(A) EXCLUSIVE TO EXCHANGES.—The 

24 public health insurance option shall be made 

25 available through the Exchanges. 


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1 ‘‘(B) ENSURING A LEVEL PLAYING

2 FIELD.—Consistent with this section, the public 

3 health insurance option shall— 

4 ‘‘(i) comply with requirements under 

5 title I of the Patient Protection and Af6 fordable Care Act, and the amendments 

7 made by that title, that are applicable to 

8 health plans offered through the Ex9 changes, including provider networks, no10 tices, consumer protections, and cost-shar11 ing; and 

12 ‘‘(ii) provide a benefit package that is 

13 comprehensive and meets the health care 

14 needs of patients, including benefits de15 scribed in section 1302(b) of the Patient 

16 Protection and Affordable Care Act. 

17 ‘‘(C) PREEMPTION.—Notwithstanding sec18 tion 1303(a)(1) of the Patient Protection and 

19 Affordable Care Act, a State law that prohibits 

20 the public health insurance option from offering 

21 the coverage described in subparagraph (B) 

22 shall be preempted. 

23 ‘‘(D) PROVISION OF BENEFIT LEVELS.— 

24 The public health insurance option shall offer 


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1 silver and gold plans and may offer bronze 

2 plans. 

3 ‘‘(2) ADMINISTRATIVE CONTRACTING.— 

4 ‘‘(A) AUTHORITIES.—The Secretary may 

5 enter into contracts for the purpose of per6 forming administrative functions (including 

7 functions described in subsection (a)(4) of sec8 tion 1874A of the Social Security Act) with re9 spect to the public health insurance option in 

10 the same manner as the Secretary may enter 

11 into contracts under subsection (a)(1) of such 

12 section. The Secretary shall have the same au13 thority with respect to the public health insur14 ance option as the Secretary has under such 

15 subsection (a)(1) and subsection (b) of section 

16 1874A of the Social Security Act with respect 

17 to title XVIII of such Act. 

18 ‘‘(B) TRANSFER OF INSURANCE RISK.— 

19 Any contract under this paragraph shall not in20 volve the transfer of insurance risk from the 

21 Secretary to the entity entering into such con22 tract with the Secretary. 

23 ‘‘(3) STATE ADVISORY COUNCIL.— 

24 ‘‘(A) ESTABLISHMENT.—A State may es25 tablish a public or nonprofit entity to serve as 


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1 the State Advisory Council to provide rec2 ommendations to the Secretary on the oper3 ations and policies of the public health insur4 ance option offered through the Exchange oper5 ating in the State. 

6 ‘‘(B) RECOMMENDATIONS.—A State Advi7 sory Council established under subparagraph 

8 (A) shall provide recommendations on at least 

9 the following: 

10 ‘‘(i) Policies and procedures to inte11 grate quality improvement and cost con12 tainment mechanisms into the health care 

13 delivery system. 

14 ‘‘(ii) Mechanisms to facilitate public 

15 awareness of the availability of the public 

16 health insurance option. 

17 ‘‘(iii) Alternative payment models and 

18 value-based insurance design under the 

19 public health insurance option that encour20 age quality improvement and cost control. 

21 ‘‘(C) MEMBERS.—The members of any 

22 State Advisory Council shall be representatives 

23 of the public and include health care consumers 

24 and health care providers. 


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1 ‘‘(D) APPLICABILITY OF RECOMMENDA2 TIONS.—The Secretary may apply the rec3 ommendations of a State Advisory Council to 

4 the public health insurance option in that State, 

5 in any other State, or in all States. 

6 ‘‘(4) DATA COLLECTION.—The Secretary shall 

7 collect such data as may be required— 

8 ‘‘(A) to establish rates for premiums and 

9 health care provider reimbursement under sub10 section (c); and 

11 ‘‘(B) for other purposes under this section, 

12 including to improve quality, and reduce racial, 

13 ethnic, socioeconomic, and other disparities, in 

14 health and health care. 

15 ‘‘(c) FINANCING THE PUBLIC HEALTH INSURANCE

16 OPTION.— 

17 ‘‘(1) PREMIUMS.— 

18 ‘‘(A) ESTABLISHMENT.—The Secretary 

19 shall establish geographically adjusted premium 

20 rates for the public health insurance option— 

21 ‘‘(i) in a manner that complies with 

22 the requirement for premium rates under 

23 subparagraph (C) and considers the data 

24 collected under subsection (b)(4); and 


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1 ‘‘(ii) at a level sufficient to fully fi2 nance— 

3 ‘‘(I) the costs of health benefits 

4 provided by the public health insur5 ance option; and 

6 ‘‘(II) administrative costs related 

7 to operating the public health insur8 ance option. 

9 ‘‘(B) CONTINGENCY MARGIN.—In estab10 lishing premium rates under subparagraph (A), 

11 the Secretary shall include an appropriate 

12 amount for a contingency margin. 

13 ‘‘(C) VARIATIONS IN PREMIUM RATES.— 

14 The premium rate charged for the public health 

15 insurance option may not vary except as pro16 vided under section 2701. 

17 ‘‘(2) HEALTH CARE PROVIDER PAYMENT RATES

18 FOR ITEMS AND SERVICES.— 

19 ‘‘(A) IN GENERAL.— 

20 ‘‘(i) RATES NEGOTIATED BY THE SEC21 RETARY.—Not later than January 1, 2020, 

22 and except as provided in clause (ii), the 

23 Secretary shall, through a negotiated 

24 agreement with health care providers, es25 tablish rates for reimbursing health care 


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1 providers for providing the benefits covered 

2 by the public health insurance option. 

3 ‘‘(ii) MEDICARE REIMBURSEMENT

4 RATES.—If the Secretary and health care 

5 providers are unable to reach a negotiated 

6 agreement on a reimbursement rate, the 

7 Secretary shall reimburse providers at 

8 rates determined for equivalent items and 

9 services under the original Medicare fee10 for-service program under parts A and B 

11 of title XVIII of the Social Security Act. 

12 ‘‘(iii) FOR NEW SERVICES.—The Sec13 retary shall modify reimbursement rates 

14 described in clause (ii) in order to accom15 modate payments for services, such as 

16 well-child visits, that are not otherwise cov17 ered under the original Medicare fee-for18 service program. 

19 ‘‘(B) PRESCRIPTION DRUGS.—Any pay20 ment rate under this subsection for a prescrip21 tion drug shall be at a rate negotiated by the 

22 Secretary. If the Secretary is unable to reach a 

23 negotiated agreement on such a reimbursement 

24 rate, the Secretary shall use rates determined 

25 for equivalent drugs paid for under the original 


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1 Medicare fee-for-service program. The Secretary 

2 shall modify such rates in order to accommo3 date payments for drugs that are not otherwise 

4 covered under the original Medicare fee-for5 service program. 

6 ‘‘(3) ACCOUNT.— 

7 ‘‘(A) ESTABLISHMENT.—There is estab8 lished in the Treasury of the United States an 

9 account for the receipts and disbursements at10 tributable to the operation of the public health 

11 insurance option, including the startup funding 

12 under subparagraph (C) and appropriations au13 thorized under subparagraph (D). 

14 ‘‘(B) PROHIBITION OF STATE IMPOSITION

15 OF TAXES.—Section 1854(g) of the Social Se16 curity Act shall apply to receipts and disburse17 ments described in subparagraph (A) in the 

18 same manner as such section applies to pay19 ments or premiums described in such section. 

20 ‘‘(C) STARTUP FUNDING.— 

21 ‘‘(i) AUTHORIZATION OF FUNDING.— 

22 There are authorized to be appropriated 

23 such sums as may be necessary to estab24 lish the public health insurance option and 


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1 cover 90 days of claims reserves based on 

2 projected enrollment. 

3 ‘‘(ii) AMORTIZATION OF STARTUP

4 FUNDING.—The Secretary shall provide for 

5 the repayment of the startup funding pro6 vided under clause (i) to the Treasury in 

7 an amortized manner over the 10-year pe8 riod beginning on January 1, 2020. 

9 ‘‘(D) ADDITIONAL AUTHORIZATION OF AP10 PROPRIATIONS.—To carry out paragraph (2) of 

11 subsection (b), there are authorized to be ap12 propriated such sums as may be necessary. 

13 ‘‘(E) LIMITATION.—Any provision of law 

14 restricting the use of Federal funds with re15 spect to any reproductive health service shall 

16 not apply to funds appropriated under this sub17 section. 

18 ‘‘(d) HEALTH CARE PROVIDER PARTICIPATION.— 

19 ‘‘(1) PROVIDER PARTICIPATION.— 

20 ‘‘(A) IN GENERAL.—The Secretary shall 

21 establish conditions of participation for health 

22 care providers under the public health insurance 

23 option. 

24 ‘‘(B) LICENSURE OR CERTIFICATION.— 

25 The Secretary shall not allow a health care proVerDate Sep 11 2014 01:41 Apr 11, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S1033.IS S1033

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1 vider to participate in the public health insur2 ance option unless such provider is appro3 priately licensed or certified under State law. 

4 ‘‘(C) CLARIFICATION.—Notwithstanding 

5 subparagraph (A), a health care provider may 

6 not be prohibited from participating in the pub7 lic health insurance option for reasons other 

8 than the ability of such provider to provide cov9 ered services. 

10 ‘‘(2) ESTABLISHMENT OF A PROVIDER NET11 WORK.— 

12 ‘‘(A) MEDICARE AND MEDICAID PARTICI13 PATING PROVIDERS.—A health care provider 

14 that is a participating provider of services or 

15 supplier under the Medicare program under 

16 title XVIII of the Social Security Act or under 

17 a State Medicaid plan under title XIX of such 

18 Act is a participating provider in the public 

19 health insurance option unless the health care 

20 provider opts out of participating in the public 

21 health insurance option through a process es22 tablished by the Secretary. 

23 ‘‘(B) ADDITIONAL PROVIDERS.—The Sec24 retary shall establish a process to allow health 

25 care providers not described in subparagraph 


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1 (A) to become participating providers in the 

2 public health insurance option.’’. 

3 (b) CONFORMING AMENDMENTS.— 

4 (1) TREATMENT AS A QUALIFIED HEALTH

5 PLAN.—Section 1301(a)(2) of the Patient Protection 

6 and Affordable Care Act (42 U.S.C. 18021(a)(2)) is 

7 amended— 

8 (A) in the paragraph heading, by inserting 

9 ‘‘, THE PUBLIC HEALTH INSURANCE OPTION,’’ 

10 before ‘‘AND’’; and 

11 (B) by inserting ‘‘the public health insur12 ance option under section 2795 of the Public 

13 Health Service Act,’’ before ‘‘and a multi-State 

14 plan’’. 

15 (2) LEVEL PLAYING FIELD.—Section 1324(a) 

16 of the Patient Protection and Affordable Care Act 

17 (42 U.S.C. 18044(a)) is amended by inserting ‘‘the 

18 public health insurance option under section 2795 of 

19 the Public Health Service Act,’’ before ‘‘or a multi20 State qualified health plan’’. 

Æ 


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