129
not liable for payment of any additional
amounts under the plan, and
‘‘(ii) if such plan no longer qualifies
as a qualified employer health plan, such
contract shall be terminated and the em-
ployer is not liable for payment of any
amounts for periods in which the plan no
longer qualifies as a qualified employer
health plan.
‘‘(4) DISQUALIFICATION FROM STATE PLAN AD-
MINISTRATION.—If an employment-related health
plan is determined to be in violation of subsection
(a) and is not determined to have come into compli-
ance with the applicable standards within 6 months
after the date of the initial determination of such a
violation, the plan shall no longer be eligible to ad-
minister a State plan under title XXII as of the end
of such 6-month period.
‘‘(d) EFFECTIVE DATE.—The effective date specified
in this subsection is January 1, 1995.
‘‘SEC. 2302. ESTABLISHMENT OF STANDARDS.
‘‘(a) ESTABLISHMENT OF STANDARDS.—
‘‘(1) NAIC.—The Secretary shall request the
NAIC—
130
‘‘(A) to develop specific standards, in the
form of a model Act and model regulations, to
implement the requirements of this title, and
‘‘(B) to report to the Secretary on such de-
velopment,
by not later than October 1 of the year following the
year in which this title is enacted. If the NAIC de-
velops such standards within such period and the
Secretary finds that such standards implement the
requirements of this title, such standards shall be
the standards applied under section 2301.
‘‘(2) SECRETARY.—If the NAIC fails to develop
and report on such standards by such date or the
Secretary finds that such standards do not imple-
ment the requirements of this title, the Secretary
shall develop and publish, by not later than Novem-
ber 15 of the year following the year in which this
title is enacted, such standards. Such standards
shall then be the standards applied under section
2301.
‘‘(b) ADDITIONAL ELEMENTS OF REGULATORY PRO-
GRAMS.—
‘‘(1) IN
GENERAL.—For purposes of section
2301(a)(1)(B), a State regulatory program shall in-
clude the following:
131
‘‘(A) Enforcement under the program—
‘‘(i) shall be designed in a manner so
as to secure compliance with the standards
within 30 days after the date of a finding
of noncompliance with such standards, and
‘‘(ii) shall provide for notice to the
Secretary in cases where such compliance
is not secured within such 30-day period.
‘‘(B) A toll-free telephone which provides
for—
‘‘(i) a system for the receipt and dis-
position of consumer and provider com-
plaints or inquiries regarding compliance
of health plans with the requirements of
this title, and
‘‘(ii) information to small employers
about carriers that offer small employer
health plans in the area covered by the
regulatory authority.
Such system shall provide for the recording of
consumer and provider complaints in accord-
ance with a uniform methodology developed by
the NAIC and recognized by the Secretary.
‘‘(2) SECRETARIAL AUTHORITY.—In the case of
a State without a regulatory program approved
132
under subsection (a), the Secretary shall provide for
the establishment of the toll-free telephone informa-
tion and complaint system described in paragraph
(1)(B).
‘‘(c) SECRETARIAL REVIEW.—
‘‘(1) PERIODIC REVIEW OF STATE REGULATORY
PROGRAMS.—The Secretary periodically shall review
State regulatory programs to determine if they con-
tinue to meet the standards referred to in subsection
(a) and the requirements of subsection (b). If the
Secretary finds that a State regulatory program no
longer meets such standards and requirements, be-
fore making a final determination, the Secretary
shall provide the State an opportunity to adopt such
a plan of correction as would permit the program to
continue to meet such standards and requirements.
If the Secretary makes a final determination that
the State regulatory program, after such an oppor-
tunity, fails to meet such standards and require-
ments, the Secretary shall assume responsibility
under section 2301(a)(2) with respect to plans in
the State.
‘‘(2) LOOK-BEHIND AUTHORITY.—In the case
of a State with a regulatory program found by the
Secretary to meet the standards and requirements
133
under this title, the Secretary nonetheless is author-
ized to determine whether or not individual insured
employment-related health plans in the State have
failed to comply with the applicable requirements of
this title.
‘‘(d) GAO AUDITS.—The Comptroller General shall
conduct periodic audits on a sample of State regulatory
programs to determine their compliance with the require-
ments of this section. The Comptroller General shall re-
port to the Secretary and Congress on the findings in such
audits.
‘‘SEC. 2303. ENROLLMENT PRACTICE AND GUARANTEED RE-
NEWABILITY REQUIREMENTS FOR SMALL EM-
PLOYER HEALTH PLANS.
‘‘(a) REGISTRATION WITH APPLICABLE REGULATORY
AUTHORITY.—
‘‘(1) IN GENERAL.—Each small employer car-
rier (as defined in section 2308(b)(3)) shall register
with the applicable regulatory authority for each
State in which it issues or offers a small employer
health plan.
‘‘(2) NO PREEMPTION OF STATE INFORMATION
REQUIREMENTS.—Nothing in paragraph (1) shall be
construed as preventing the applicable regulatory
authority from requiring such additional information
141
‘‘(ii) ROLE OF REGULATORY AUTHOR-
ITY.—An applicable regulatory authority
that is a State may reduce or eliminate the
percent 
variation 
otherwise 
permitted
under clause (i).
‘‘(iii) EXCEPTION.—Clause (i) shall
not apply to a block of business—
‘‘(I) if the block is one for which
the carrier does not reject, and never
has rejected, small employers included
within the definition of employers eli-
gible for the block of business or oth-
erwise eligible employees and depend-
ents who enroll on a timely basis,
‘‘(II) the carrier does not invol-
untarily transfer, and never has invol-
untarily transferred, a health plan
into or out of the block of business,
and
‘‘(III) that block of business was
available for purchase as of the date
of the enactment of this title.
‘‘(2) TRANSITION.—Notwithstanding paragraph
(1)—