I
107TH CONGRESS
1ST SESSION
H. R. 2563
To amend the Public Health Service Act, the Employee Retirement Income
Security Act of 1974, and the Internal Revenue Code of 1986 to protect
consumers in managed care plans and other health coverage.
IN THE HOUSE OF REPRESENTATIVES
JULY 19, 2001
Mr. GANSKE (for himself, Mr. DINGELL, Mr. NORWOOD, Mr. BERRY, Mr.
LEACH, Mr. BROWN of Ohio, Mrs. ROUKEMA, Mr. JOHN, Mrs. MORELLA,
Mr. ANDREWS, Mr. GILMAN, Mr. RANGEL, Mr. LATOURETTE, Mr. STEN-
HOLM, Mr. HORN, Mr. SANDLIN, Mr. BARR of Georgia, Mr. STUPAK, Mr.
SMITH of New Jersey, Mr. PALLONE, Mr. TOWNS, Ms. ESHOO, Mrs.
CAPPS, Mr. GREEN of Texas, Mr. GORDON, Ms. MCCARTHY of Missouri,
Mr. ENGEL, Mr. MOORE, Mr. STRICKLAND, Mr. MARKEY, Mr. SAWYER,
Mrs. DAVIS of California, Mr. BARRETT of Wisconsin, Mr. WYNN, Mr.
STARK, Mr. WAXMAN, Mr. RUSH, Mr. BOUCHER, Mr. HALL of Texas,
Mr. BISHOP, Mr. TURNER, Ms. HARMAN, Mr. PASCRELL, Mrs. MCCAR-
THY
of New York, Mr. FRANK, Mr. MATSUI, Mr. COYNE, Mr.
MCDERMOTT, Mr. CARDIN, Mr. LEVIN, Mr. MCNULTY, Mr. JEFFERSON,
Mr. LEWIS of Georgia, Mr. KLECZKA, Mrs. THURMAN, Mr. BOSWELL,
Mr. CROWLEY, Mr. TIERNEY, Mr. HOEFFEL, Mr. MEEHAN, Mr. DOYLE,
Ms. DEGETTE, Mr. MATHESON, Mr. KUCINICH, Ms. PELOSI, Mr. BER-
MAN, Mr. THOMPSON of California, Mr. GEORGE MILLER of California,
and Mr. ROSS) introduced the following bill; which was referred to the
Committee on Energy and Commerce, and in addition to the Committees
on Education and the Workforce, and Ways and Means, for a period to
be subsequently determined by the Speaker, in each case for consider-
ation of such provisions as fall within the jurisdiction of the committee
concerned
A BILL
To amend the Public Health Service Act, the Employee Re-
tirement Income Security Act of 1974, and the Internal
Revenue Code of 1986 to protect consumers in managed
care plans and other health coverage.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Bipartisan Patient Protection Act’’.
(b) TABLE OF CONTENTS.—The table of contents of
this Act is as follows:
Sec. 1. Short title; table of contents.
TITLE I—IMPROVING MANAGED CARE
Subtitle A—Utilization Review; Claims; and Internal and External Appeals
Sec. 101. Utilization review activities.
Sec. 102. Procedures for initial claims for benefits and prior authorization de-
terminations.
Sec. 103. Internal appeals of claims denials.
Sec. 104. Independent external appeals procedures.
Sec. 105. Health care consumer assistance fund.
Subtitle B—Access to Care
Sec. 111. Consumer choice option.
Sec. 112. Choice of health care professional.
Sec. 113. Access to emergency care.
Sec. 114. Timely access to specialists.
Sec. 115. Patient access to obstetrical and gynecological care.
Sec. 116. Access to pediatric care.
Sec. 117. Continuity of care.
Sec. 118. Access to needed prescription drugs.
Sec. 119. Coverage for individuals participating in approved clinical trials.
Sec. 120. Required coverage for minimum hospital stay for mastectomies and
lymph node dissections for the treatment of breast cancer and
coverage for secondary consultations.
Subtitle C—Access to Information
Sec. 121. Patient access to information.
Subtitle D—Protecting the Doctor-Patient Relationship
Sec. 131. Prohibition of interference with certain medical communications.
Sec. 132. Prohibition of discrimination against providers based on licensure.
Sec. 133. Prohibition against improper incentive arrangements.
Sec. 134. Payment of claims.
Sec. 135. Protection for patient advocacy.
Subtitle E—Definitions
Sec. 151. Definitions.
Sec. 152. Preemption; State flexibility; construction.
Sec. 153. Exclusions.
Sec. 154. Treatment of excepted benefits.
Sec. 155. Regulations.
Sec. 156. Incorporation into plan or coverage documents.
Sec. 157. Preservation of protections.
TITLE II—APPLICATION OF QUALITY CARE STANDARDS TO
GROUP HEALTH PLANS AND HEALTH INSURANCE COVERAGE
UNDER THE PUBLIC HEALTH SERVICE ACT
Sec. 201. Application to group health plans and group health insurance cov-
erage.
Sec. 202. Application to individual health insurance coverage.
Sec. 203. Cooperation between Federal and State authorities.
TITLE III—APPLICATION OF PATIENT PROTECTION STANDARDS
TO FEDERAL HEALTH INSURANCE PROGRAMS
Sec. 301. Application of patient protection standards to Federal health insur-
ance programs.
TITLE IV—AMENDMENTS TO THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974
Sec. 401. Application of patient protection standards to group health plans and
group health insurance coverage under the Employee Retire-
ment Income Security Act of 1974.
Sec. 402. Availability of civil remedies.
Sec. 403. Limitation on certain class action litigation.
Sec. 404. Limitations on actions.
Sec. 405. Cooperation between Federal and State authorities.
Sec. 406. Sense of the Senate concerning the importance of certain unpaid
services.
TITLE V—AMENDMENTS TO THE INTERNAL REVENUE CODE OF
1986
Subtitle A—Application of Patient Protection Provisions
Sec. 501. Application of requirements to group health plans under the Internal
Revenue Code of 1986.
Sec. 502. Conforming enforcement for women’s health and cancer rights.
Subtitle B—Health Care Coverage Access Tax Incentives
Sec. 511. Expanded availability of Archer MSAs.
Sec. 512. Deduction for 100 percent of health insurance costs of self-employed
individuals.
Sec. 513. Credit for health insurance expenses of small businesses.
Sec. 514. Certain grants by private foundations to qualified health benefit pur-
chasing coalitions.
Sec. 515. State grant program for market innovation.
TITLE VI—EFFECTIVE DATES; COORDINATION IN
IMPLEMENTATION
Sec. 601. Effective dates.
Sec. 602. Coordination in implementation.
Sec. 603. Severability.
TITLE VII—MISCELLANEOUS PROVISIONS
Sec. 701. No impact on Social Security Trust Fund.
Sec. 702. Customs user fees.
Sec. 703. Fiscal year 2002 medicare payments.
Sec. 704. Sense of Senate with respect to participation in clinical trials and ac-
cess to specialty care.
Sec. 705. Sense of the Senate regarding fair review process.
Sec. 706. Annual review.
Sec. 707. Definition of born-alive infant.
TITLE I—IMPROVING MANAGED
CARE
Subtitle 
A—Utilization 
Review;
Claims; and Internal and Exter-
nal Appeals
SEC. 101. UTILIZATION REVIEW ACTIVITIES.
(a) COMPLIANCE WITH REQUIREMENTS.—
(1) IN GENERAL.—A group health plan, and a
health insurance issuer that provides health insur-
ance coverage, shall conduct utilization review activi-
ties in connection with the provision of benefits
under such plan or coverage only in accordance with
a utilization review program that meets the require-
ments of this section and section 102.
(2) USE OF OUTSIDE AGENTS.—Nothing in this
section shall be construed as preventing a group
health plan or health insurance issuer from arrang-
ing through a contract or otherwise for persons or
entities to conduct utilization review activities on be-
half of the plan or issuer, so long as such activities
are conducted in accordance with a utilization review
program that meets the requirements of this section.
(3) UTILIZATION REVIEW DEFINED.—For pur-
poses of this section, the terms ‘‘utilization review’’
and ‘‘utilization review activities’’ mean procedures
used to monitor or evaluate the use or coverage,
clinical necessity, appropriateness, efficacy, or effi-
ciency of health care services, procedures or settings,
and includes prospective review, concurrent review,
second opinions, case management, discharge plan-
ning, or retrospective review.
(b) WRITTEN POLICIES AND CRITERIA.—
(1) WRITTEN POLICIES.—A utilization review
program shall be conducted consistent with written
policies and procedures that govern all aspects of the
program.
(2) USE OF WRITTEN CRITERIA.—
(A) IN GENERAL.—Such a program shall
utilize written clinical review criteria developed
with input from a range of appropriate actively
practicing health care professionals, as deter-
mined by the plan, pursuant to the program.
Such criteria shall include written clinical re-
view criteria that are based on valid clinical evi-
dence where available and that are directed spe-
cifically at meeting the needs of at-risk popu-
lations and covered individuals with chronic
conditions or severe illnesses, including gender-
specific criteria and pediatric-specific criteria
where available and appropriate.
(B) CONTINUING USE OF STANDARDS IN
RETROSPECTIVE
REVIEW.—If a health care
service has been specifically pre-authorized or
approved for a participant, beneficiary, or en-
rollee under such a program, the program shall
not, pursuant to retrospective review, revise or
modify the specific standards, criteria, or proce-
dures used for the utilization review for proce-
dures, treatment, and services delivered to the
enrollee during the same course of treatment.
(C) REVIEW OF SAMPLE OF CLAIMS DENI-
ALS.—Such a program shall provide for a peri-
odic evaluation of the clinical appropriateness of
at least a sample of denials of claims for bene-
fits.
(c) CONDUCT OF PROGRAM ACTIVITIES.—
(1) ADMINISTRATION BY HEALTH CARE PRO-
FESSIONALS.—A utilization review program shall be
administered by qualified health care professionals
who shall oversee review decisions.
(2) USE
OF
QUALIFIED, INDEPENDENT
PER-
SONNEL.—
(A) IN
GENERAL.—A utilization review
program shall provide for the conduct of utiliza-
tion review activities only through personnel
who are qualified and have received appropriate
training in the conduct of such activities under
the program.
(B) PROHIBITION
OF
CONTINGENT
COM-
PENSATION ARRANGEMENTS.—Such a program
shall not, with respect to utilization review ac-
tivities, permit or provide compensation or any-
thing of value to its employees, agents, or con-
tractors in a manner that encourages denials of
claims for benefits.
(C) PROHIBITION OF CONFLICTS.—Such a
program shall not permit a health care profes-
sional who is providing health care services to
an individual to perform utilization review ac-
tivities in connection with the health care serv-
ices being provided to the individual.
(3) ACCESSIBILITY OF REVIEW.—Such a pro-
gram shall provide that appropriate personnel per-
forming utilization review activities under the pro-
gram, including the utilization review administrator,
are reasonably accessible by toll-free telephone dur-
ing normal business hours to discuss patient care
and allow response to telephone requests, and that
appropriate provision is made to receive and respond
promptly to calls received during other hours.
(4) LIMITS ON FREQUENCY.—Such a program
shall not provide for the performance of utilization
review activities with respect to a class of services
furnished to an individual more frequently than is
reasonably required to assess whether the services
under review are medically necessary and appro-
priate.
SEC. 102. PROCEDURES FOR INITIAL CLAIMS FOR BENE-
FITS AND PRIOR AUTHORIZATION DETER-
MINATIONS.
(a) PROCEDURES OF INITIAL CLAIMS FOR BENE-
FITS.—
(1) IN GENERAL.—A group health plan, and a
health insurance issuer offering health insurance
coverage, shall—
(A) make a determination on an initial
claim for benefits by a participant, beneficiary,
or enrollee (or authorized representative) re-
garding payment or coverage for items or serv-
ices under the terms and conditions of the plan
or coverage involved, including any cost-sharing
amount that the participant, beneficiary, or en-
rollee is required to pay with respect to such
claim for benefits; and
(B) notify a participant, beneficiary, or en-
rollee (or authorized representative) and the
treating health care professional involved re-
garding a determination on an initial claim for
benefits made under the terms and conditions
of the plan or coverage, including any cost-shar-
ing amounts that the participant, beneficiary,
or enrollee may be required to make with re-
spect to such claim for benefits, and of the
right of the participant, beneficiary, or enrollee
to an internal appeal under section 103.
(2) ACCESS TO INFORMATION.—
(A) TIMELY PROVISION OF NECESSARY IN-
FORMATION.—With respect to an initial claim
for benefits, the participant, beneficiary, or en-
rollee (or authorized representative) and the
treating health care professional (if any) shall
provide the plan or issuer with access to infor-
mation requested by the plan or issuer that is
necessary to make a determination relating to
the claim. Such access shall be provided not
later than 5 days after the date on which the
request for information is received, or, in a case
described in subparagraph (B) or (C) of sub-
section (b)(1), by such earlier time as may be
necessary to comply with the applicable timeline
under such subparagraph.
(B) LIMITED
EFFECT
OF
FAILURE
ON
PLAN
OR
ISSUER’S
OBLIGATIONS.—Failure of
the participant, beneficiary, or enrollee to com-
ply with the requirements of subparagraph (A)
shall not remove the obligation of the plan or
issuer to make a decision in accordance with
the medical exigencies of the case and as soon
as possible, based on the available information,
and failure to comply with the time limit estab-
lished by this paragraph shall not remove the
obligation of the plan or issuer to comply with
the requirements of this section.
(3) ORAL REQUESTS.—In the case of a claim
for benefits involving an expedited or concurrent de-
termination, a participant, beneficiary, or enrollee
(or authorized representative) may make an initial
claim for benefits orally, but a group health plan, or
health insurance issuer offering health insurance
coverage, may require that the participant, bene-
ficiary, or enrollee (or authorized representative)
provide written confirmation of such request in a
timely manner on a form provided by the plan or
issuer. In the case of such an oral request for bene-
fits, the making of the request (and the timing of
such request) shall be treated as the making at that
time of a claim for such benefits without regard to
whether and when a written confirmation of such re-
quest is made.
(b) TIMELINE FOR MAKING DETERMINATIONS.—
(1) PRIOR AUTHORIZATION DETERMINATION.—
(A) IN GENERAL.—A group health plan,
and a health insurance issuer offering health in-
surance coverage, shall make a prior authoriza-
tion determination on a claim for benefits
(whether oral or written) in accordance with the
medical exigencies of the case and as soon as
possible, but in no case later than 14 days from
the date on which the plan or issuer receives in-
formation that is reasonably necessary to enable
the plan or issuer to make a determination on
the request for prior authorization and in no
case later than 28 days after the date of the
claim for benefits is received.
(B) EXPEDITED
DETERMINATION.—Not-
withstanding subparagraph (A), a group health
plan, and a health insurance issuer offering
health insurance coverage, shall expedite a prior
authorization determination on a claim for ben-
efits described in such subparagraph when a re-
quest for such an expedited determination is
made by a participant, beneficiary, or enrollee
(or authorized representative) at any time dur-
ing the process for making a determination and
a health care professional certifies, with the re-
quest, that a determination under the proce-
dures described in subparagraph (A) would seri-
ously jeopardize the life or health of the partici-
pant, beneficiary, or enrollee or the ability of
the participant, beneficiary, or enrollee to main-
tain or regain maximum function. Such deter-
mination shall be made in accordance with the
medical exigencies of the case and as soon as
possible, but in no case later than 72 hours
after the time the request is received by the
plan or issuer under this subparagraph.
(C) ONGOING CARE.—
(i) CONCURRENT REVIEW.—
(I) IN
GENERAL.—Subject to
clause (ii), in the case of a concurrent
review of ongoing care (including hos-
pitalization), which results in a termi-
nation or reduction of such care, the
plan or issuer must provide by tele-
phone and in printed form notice of
the concurrent review determination
to the individual or the individual’s
designee and the individual’s health
care provider in accordance with the
medical exigencies of the case and as
soon as possible, with sufficient time
prior to the termination or reduction
to allow for an appeal under section
103(b)(3) to be completed before the
termination or reduction takes effect.
(II) CONTENTS
OF
NOTICE.—
Such notice shall include, with respect
to ongoing health care items and serv-
ices, the number of ongoing services
approved, the new total of approved
services, the date of onset of services,
and the next review date, if any, as
well as a statement of the individual’s
rights to further appeal.
(ii) RULE OF CONSTRUCTION.—Clause
(i) shall not be construed as requiring
plans or issuers to provide coverage of care
that would exceed the coverage limitations
for such care.
(2) 
RETROSPECTIVE
DETERMINATION.—A
group health plan, and a health insurance issuer of-
fering health insurance coverage, shall make a retro-
spective determination on a claim for benefits in ac-
cordance with the medical exigencies of the case and
as soon as possible, but not later than 30 days after
the date on which the plan or issuer receives infor-
mation that is reasonably necessary to enable the
plan or issuer to make a determination on the claim,
or, if earlier, 60 days after the date of receipt of the
claim for benefits.
(c) NOTICE OF A DENIAL OF A CLAIM FOR BENE-
FITS.—Written notice of a denial made under an initial
claim for benefits shall be issued to the participant, bene-
ficiary, or enrollee (or authorized representative) and the
treating health care professional in accordance with the
medical exigencies of the case and as soon as possible, but
in no case later than 2 days after the date of the deter-
mination (or, in the case described in subparagraph (B)
or (C) of subsection (b)(1), within the 72-hour or applica-
ble period referred to in such subparagraph).
(d) REQUIREMENTS
OF NOTICE
OF DETERMINA-
TIONS.—The written notice of a denial of a claim for bene-
fits determination under subsection (c) shall be provided
in printed form and written in a manner calculated to be
understood by the participant, beneficiary, or enrollee and
shall include—
(1) the specific reasons for the determination
(including a summary of the clinical or scientific evi-
dence used in making the determination);
(2) the procedures for obtaining additional in-
formation concerning the determination; and
(3) notification of the right to appeal the deter-
mination and instructions on how to initiate an ap-
peal in accordance with section 103.
(e) DEFINITIONS.—For purposes of this part:
(1) AUTHORIZED REPRESENTATIVE.—The term
‘‘authorized representative’’ means, with respect to
an individual who is a participant, beneficiary, or en-
rollee, any health care professional or other person
acting on behalf of the individual with the individ-
ual’s consent or without such consent if the indi-
vidual is medically unable to provide such consent.
(2) CLAIM FOR BENEFITS.—The term ‘‘claim
for benefits’’ means any request for coverage (in-
cluding authorization of coverage), for eligibility, or
for payment in whole or in part, for an item or serv-
ice under a group health plan or health insurance
coverage.
(3) DENIAL
OF
CLAIM
FOR
BENEFITS.—The
term ‘‘denial’’ means, with respect to a claim for
benefits, a denial (in whole or in part) of, or a fail-
ure to act on a timely basis upon, the claim for ben-
efits and includes a failure to provide benefits (in-
cluding items and services) required to be provided
under this title.
(4) TREATING HEALTH CARE PROFESSIONAL.—
The term ‘‘treating health care professional’’ means,
with respect to services to be provided to a partici-
pant, beneficiary, or enrollee, a health care profes-
sional who is primarily responsible for delivering
those services to the participant, beneficiary, or en-
rollee.
SEC. 103. INTERNAL APPEALS OF CLAIMS DENIALS.
(a) RIGHT TO INTERNAL APPEAL.—
(1) IN GENERAL.—A participant, beneficiary, or
enrollee (or authorized representative) may appeal
any denial of a claim for benefits under section 102
under the procedures described in this section.
(2) TIME FOR APPEAL.—
(A) IN GENERAL.—A group health plan,
and a health insurance issuer offering health in-
surance coverage, shall ensure that a partici-
pant, beneficiary, or enrollee (or authorized rep-
resentative) has a period of not less than 180
days beginning on the date of a denial of a
claim for benefits under section 102 in which to
appeal such denial under this section.
(B) DATE OF DENIAL.—For purposes of
subparagraph (A), the date of the denial shall
be deemed to be the date as of which the partic-
ipant, beneficiary, or enrollee knew of the denial
of the claim for benefits.
(3) FAILURE TO ACT.—The failure of a plan or
issuer to issue a determination on a claim for bene-
fits under section 102 within the applicable timeline
established for such a determination under such sec-
tion is a denial of a claim for benefits for purposes
this subtitle as of the date of the applicable deadline.
(4) PLAN WAIVER OF INTERNAL REVIEW.—A
group health plan, or health insurance issuer offer-
ing health insurance coverage, may waive the inter-
nal review process under this section. In such case
the plan or issuer shall provide notice to the partici-
pant, beneficiary, or enrollee (or authorized rep-
resentative) involved, the participant, beneficiary, or
enrollee (or authorized representative) involved shall
be relieved of any obligation to complete the internal
review involved, and may, at the option of such par-
ticipant, beneficiary, enrollee, or representative pro-
ceed directly to seek further appeal through external
review under section 104 or otherwise.
(b) TIMELINES FOR MAKING DETERMINATIONS.—
(1) ORAL REQUESTS.—In the case of an appeal
of a denial of a claim for benefits under this section
that involves an expedited or concurrent determina-
tion, a participant, beneficiary, or enrollee (or au-
thorized representative) may request such appeal
orally. A group health plan, or health insurance
issuer offering health insurance coverage, may re-
quire that the participant, beneficiary, or enrollee
(or authorized representative) provide written con-
firmation of such request in a timely manner on a
form provided by the plan or issuer. In the case of
such an oral request for an appeal of a denial, the
making of the request (and the timing of such re-
quest) shall be treated as the making at that time
of a request for an appeal without regard to whether
and when a written confirmation of such request is
made.
(2) ACCESS TO INFORMATION.—
(A) TIMELY PROVISION OF NECESSARY IN-
FORMATION.—With respect to an appeal of a
denial of a claim for benefits, the participant,
beneficiary, or enrollee (or authorized represent-
ative) and the treating health care professional
(if any) shall provide the plan or issuer with
access to information requested by the plan or
issuer that is necessary to make a determina-
tion relating to the appeal. Such access shall
be provided not later than 5 days after the date
on which the request for information is re-
ceived, or, in a case described in subparagraph
(B) or (C) of paragraph (3), by such earlier
time as may be necessary to comply with the
applicable timeline under such subparagraph.
(B) LIMITED
EFFECT
OF
FAILURE
ON
PLAN
OR
ISSUER’S
OBLIGATIONS.—Failure of
the participant, beneficiary, or enrollee to com-
ply with the requirements of subparagraph (A)
shall not remove the obligation of the plan or
issuer to make a decision in accordance with
the medical exigencies of the case and as soon
as possible, based on the available information,
and failure to comply with the time limit estab-
lished by this paragraph shall not remove the
obligation of the plan or issuer to comply with
the requirements of this section.
(3) 
PRIOR
AUTHORIZATION
DETERMINA-
TIONS.—
(A) IN GENERAL.—Except as provided in
this paragraph or paragraph (4), a group
health plan, and a health insurance issuer offer-
ing health insurance coverage, shall make a de-
termination on an appeal of a denial of a claim
for benefits under this subsection in accordance
with the medical exigencies of the case and as
soon as possible, but in no case later than 14
days from the date on which the plan or issuer
receives information that is reasonably nec-
essary to enable the plan or issuer to make a
determination on the appeal and in no case
later than 28 days after the date the request
for the appeal is received.
(B) EXPEDITED
DETERMINATION.—Not-
withstanding subparagraph (A), a group health
plan, and a health insurance issuer offering
health insurance coverage, shall expedite a prior
authorization determination on an appeal of a
denial of a claim for benefits described in sub-
paragraph (A), when a request for such an ex-
pedited determination is made by a participant,
beneficiary, or enrollee (or authorized represent-
ative) at any time during the process for mak-
ing a determination and a health care profes-
sional certifies, with the request, that a deter-
mination under the procedures described in sub-
paragraph (A) would seriously jeopardize the
life or health of the participant, beneficiary, or
enrollee or the ability of the participant, bene-
ficiary, or enrollee to maintain or regain max-
imum function. Such determination shall be
made in accordance with the medical exigencies
of the case and as soon as possible, but in no
case later than 72 hours after the time the re-
quest for such appeal is received by the plan or
issuer under this subparagraph.
(C) ONGOING CARE DETERMINATIONS.—
(i) IN
GENERAL.—Subject to clause
(ii), in the case of a concurrent review de-
termination 
described 
in 
section
102(b)(1)(C)(i)(I), which results in a ter-
mination or reduction of such care, the
plan or issuer must provide notice of the
determination on the appeal under this
section by telephone and in printed form to
the individual or the individual’s designee
and the individual’s health care provider in
accordance with the medical exigencies of
the case and as soon as possible, with suf-
ficient time prior to the termination or re-
duction to allow for an external appeal
under section 104 to be completed before
the termination or reduction takes effect.
(ii) RULE OF CONSTRUCTION.—Clause
(i) shall not be construed as requiring
plans or issuers to provide coverage of care
that would exceed the coverage limitations
for such care.
(4) 
RETROSPECTIVE
DETERMINATION.—A
group health plan, and a health insurance issuer of-
fering health insurance coverage, shall make a retro-
spective determination on an appeal of a denial of a
claim for benefits in no case later than 30 days after
the date on which the plan or issuer receives nec-
essary information that is reasonably necessary to
enable the plan or issuer to make a determination on
the appeal and in no case later than 60 days after
the date the request for the appeal is received.
(c) CONDUCT OF REVIEW.—
(1) IN GENERAL.—A review of a denial of a
claim for benefits under this section shall be con-
ducted by an individual with appropriate expertise
who was not involved in the initial determination.
(2) PEER REVIEW OF MEDICAL DECISIONS BY
HEALTH CARE PROFESSIONALS.—A review of an ap-
peal of a denial of a claim for benefits that is based
on a lack of medical necessity and appropriateness,
or based on an experimental or investigational treat-
ment, or requires an evaluation of medical facts—
(A) 
shall 
be 
made 
by 
a 
physician
(allopathic or osteopathic); or
(B) in a claim for benefits provided by a
non-physician health professional, shall be made
by reviewer (or reviewers) including at least one
practicing non-physician health professional of
the same or similar specialty;
with appropriate expertise (including, in the case of
a child, appropriate pediatric expertise) and acting
within the appropriate scope of practice within the
State in which the service is provided or rendered,
who was not involved in the initial determination.
(d) NOTICE OF DETERMINATION.—
(1) IN GENERAL.—Written notice of a deter-
mination made under an internal appeal of a denial
of a claim for benefits shall be issued to the partici-
pant, beneficiary, or enrollee (or authorized rep-
resentative) and the treating health care professional
in accordance with the medical exigencies of the case
and as soon as possible, but in no case later than
2 days after the date of completion of the review (or,
in the case described in subparagraph (B) or (C) of
subsection (b)(3), within the 72-hour or applicable
period referred to in such subparagraph).
(2) FINAL DETERMINATION.—The decision by a
plan or issuer under this section shall be treated as
the final determination of the plan or issuer on a de-
nial of a claim for benefits. The failure of a plan or
issuer to issue a determination on an appeal of a de-
nial of a claim for benefits under this section within
the applicable timeline established for such a deter-
mination shall be treated as a final determination on
an appeal of a denial of a claim for benefits for pur-
poses of proceeding to external review under section
104.
(3) REQUIREMENTS OF NOTICE.—With respect
to a determination made under this section, the no-
tice described in paragraph (1) shall be provided in
printed form and written in a manner calculated to
be understood by the participant, beneficiary, or en-
rollee and shall include—
(A) the specific reasons for the determina-
tion (including a summary of the clinical or sci-
entific evidence used in making the determina-
tion);
(B) the procedures for obtaining additional
information concerning the determination; and
(C) notification of the right to an inde-
pendent external review under section 104 and
instructions on how to initiate such a review.
SEC. 104. INDEPENDENT EXTERNAL APPEALS PROCE-
DURES.
(a) RIGHT TO EXTERNAL APPEAL.—A group health
plan, and a health insurance issuer offering health insur-
ance coverage, shall provide in accordance with this sec-
tion participants, beneficiaries, and enrollees (or author-
ized representatives) with access to an independent exter-
nal review for any denial of a claim for benefits.
(b) INITIATION OF THE INDEPENDENT EXTERNAL
REVIEW PROCESS.—
(1) TIME
TO
FILE.—A request for an inde-
pendent external review under this section shall be
filed with the plan or issuer not later than 180 days
after the date on which the participant, beneficiary,
or enrollee receives notice of the denial under section
103(d) or notice of waiver of internal review under
section 103(a)(4) or the date on which the plan or
issuer has failed to make a timely decision under
section 103(d)(2) and notifies the participant or
beneficiary that it has failed to make a timely deci-
sion and that the beneficiary must file an appeal
with an external review entity within 180 days if the
participant or beneficiary desires to file such an ap-
peal.
(2) FILING OF REQUEST.—
(A) IN
GENERAL.—Subject to the suc-
ceeding provisions of this subsection, a group
health plan, or health insurance issuer offering
health insurance coverage, may—
(i) except as provided in subparagraph
(B)(i), require that a request for review be
in writing;
(ii) limit the filing of such a request
to the participant, beneficiary, or enrollee
involved (or an authorized representative);
(iii) except if waived by the plan or
issuer under section 103(a)(4), condition
access to an independent external review
under this section upon a final determina-
tion of a denial of a claim for benefits
under the internal review procedure under
section 103;
(iv) except as provided in subpara-
graph (B)(ii), require payment of a filing
fee to the plan or issuer of a sum that does
not exceed $25; and
(v) require that a request for review
include the consent of the participant, ben-
eficiary, or enrollee (or authorized rep-
resentative) for the release of necessary
medical information or records of the par-
ticipant, beneficiary, or enrollee to the
qualified external review entity only for
purposes of conducting external review ac-
tivities.
(B) REQUIREMENTS AND EXCEPTION RE-
LATING TO GENERAL RULE.—
(i) ORAL
REQUESTS
PERMITTED
IN
EXPEDITED OR CONCURRENT CASES.—In
the case of an expedited or concurrent ex-
ternal review as provided for under sub-
section (e), the request for such review
may be made orally. A group health plan,
or health insurance issuer offering health
insurance coverage, may require that the
participant, beneficiary, or enrollee (or au-
thorized representative) provide written
confirmation of such request in a timely
manner on a form provided by the plan or
issuer. Such written confirmation shall be
treated as a consent for purposes of sub-
paragraph (A)(v). In the case of such an
oral request for such a review, the making
of the request (and the timing of such re-
quest) shall be treated as the making at
that time of a request for such a review
without regard to whether and when a
written confirmation of such request is
made.
(ii) EXCEPTION TO FILING FEE RE-
QUIREMENT.—
(I) INDIGENCY.—Payment of a
filing fee shall not be required under
subparagraph (A)(iv) where there is a
certification (in a form and manner
specified in guidelines established by
the appropriate Secretary) that the
participant, beneficiary, or enrollee is
indigent (as defined in such guide-
lines).
(II) FEE NOT REQUIRED.—Pay-
ment of a filing fee shall not be re-
quired under subparagraph (A)(iv) if
the plan or issuer waives the internal
appeals 
process 
under 
section
103(a)(4).
(III) REFUNDING OF FEE.—The
filing fee paid under subparagraph
(A)(iv) shall be refunded if the deter-
mination under the independent exter-
nal review is to reverse or modify the
denial which is the subject of the re-
view.
(IV) COLLECTION
OF
FILING
FEE.—The failure to pay such a filing
fee shall not prevent the consideration
of a request for review but, subject to
the preceding provisions of this clause,
shall constitute a legal liability to pay.
(c) REFERRAL TO QUALIFIED EXTERNAL REVIEW
ENTITY UPON REQUEST.—
(1) IN GENERAL.—Upon the filing of a request
for independent external review with the group
health plan, or health insurance issuer offering
health insurance coverage, the plan or issuer shall
immediately refer such request, and forward the
plan or issuer’s initial decision (including the infor-
mation described in section 103(d)(3)(A)), to a
qualified external review entity selected in accord-
ance with this section.
(2) ACCESS TO PLAN OR ISSUER AND HEALTH
PROFESSIONAL INFORMATION.—With respect to an
independent external review conducted under this
section, the participant, beneficiary, or enrollee (or
authorized representative), the plan or issuer, and
the treating health care professional (if any) shall
provide the external review entity with information
that is necessary to conduct a review under this sec-
tion, as determined and requested by the entity.
Such information shall be provided not later than 5
days after the date on which the request for infor-
mation is received, or, in a case described in clause
(ii) or (iii) of subsection (e)(1)(A), by such earlier
time as may be necessary to comply with the appli-
cable timeline under such clause.
(3) SCREENING OF REQUESTS BY QUALIFIED
EXTERNAL REVIEW ENTITIES.—
(A) IN GENERAL.—With respect to a re-
quest referred to a qualified external review en-
tity under paragraph (1) relating to a denial of
a claim for benefits, the entity shall refer such
request for the conduct of an independent med-
ical review unless the entity determines that—
(i) any of the conditions described in
clauses (ii) or (iii) of subsection (b)(2)(A)
have not been met;
(ii) the denial of the claim for benefits
does not involve a medically reviewable de-
cision under subsection (d)(2);
(iii) the denial of the claim for bene-
fits relates to a decision regarding whether
an individual is a participant, beneficiary,
or enrollee who is enrolled under the terms
and conditions of the plan or coverage (in-
cluding the applicability of any waiting pe-
riod under the plan or coverage); or
(iv) the denial of the claim for bene-
fits is a decision as to the application of
cost-sharing requirements or the applica-
tion of a specific exclusion or express limi-
tation on the amount, duration, or scope of
coverage of items or services under the
terms and conditions of the plan or cov-
erage unless the decision is a denial de-
scribed in subsection (d)(2).
Upon making a determination that any of
clauses (i) through (iv) applies with respect to
the request, the entity shall determine that the
denial of a claim for benefits involved is not eli-
gible for independent medical review under sub-
section (d), and shall provide notice in accord-
ance with subparagraph (C).
(B) PROCESS
FOR
MAKING
DETERMINA-
TIONS.—
(i) NO DEFERENCE TO PRIOR DETER-
MINATIONS.—In 
making 
determinations
under subparagraph (A), there shall be no
deference given to determinations made by
the plan or issuer or the recommendation
of a treating health care professional (if
any).
(ii) 
USE
OF
APPROPRIATE
PER-
SONNEL.—A qualified external review enti-
ty shall use appropriately qualified per-
sonnel to make determinations under this
section.
(C) NOTICES
AND
GENERAL
TIMELINES
FOR DETERMINATION.—
(i) NOTICE IN CASE OF DENIAL OF
REFERRAL.—If the entity under this para-
graph does not make a referral to an inde-
pendent medical reviewer, the entity shall
provide notice to the plan or issuer, the
participant, beneficiary, or enrollee (or au-
thorized representative) filing the request,
and the treating health care professional
(if any) that the denial is not subject to
independent medical review. Such notice—
(I) shall be written (and, in addi-
tion, may be provided orally) in a
manner calculated to be understood
by a participant or enrollee;
(II) shall include the reasons for
the determination;
(III) include any relevant terms
and conditions of the plan or cov-
erage; and
(IV) include a description of any
further recourse available to the indi-
vidual.
(ii) GENERAL TIMELINE FOR DETER-
MINATIONS.—Upon receipt of information
under paragraph (2), the qualified external
review entity, and if required the inde-
pendent medical reviewer, shall make a de-
termination within the overall timeline that
is applicable to the case under review as
described in subsection (e), except that if
the entity determines that a referral to an
independent medical reviewer is not re-
quired, the entity shall provide notice of
such determination to the participant, ben-
eficiary, or enrollee (or authorized rep-
resentative) within such timeline and with-
in 2 days of the date of such determina-
tion.
(d) INDEPENDENT MEDICAL REVIEW.—
(1) IN GENERAL.—If a qualified external review
entity determines under subsection (c) that a denial
of a claim for benefits is eligible for independent
medical review, the entity shall refer the denial in-
volved to an independent medical reviewer for the
conduct of an independent medical review under this
subsection.
(2) MEDICALLY
REVIEWABLE
DECISIONS.—A
denial of a claim for benefits is eligible for inde-
pendent medical review if the benefit for the item or
service for which the claim is made would be a cov-
ered benefit under the terms and conditions of the
plan or coverage but for one (or more) of the fol-
lowing determinations:
(A) DENIALS BASED ON MEDICAL NECES-
SITY AND APPROPRIATENESS.—A determination
that the item or service is not covered because
it is not medically necessary and appropriate or
based on the application of substantially equiva-
lent terms.
(B) DENIALS
BASED
ON
EXPERIMENTAL
OR
INVESTIGATIONAL
TREATMENT.—A deter-
mination that the item or service is not covered
because it is experimental or investigational or
based on the application of substantially equiva-
lent terms.
(C) DENIALS OTHERWISE BASED ON AN
EVALUATION
OF
MEDICAL
FACTS.—A deter-
mination that the item or service or condition
is not covered based on grounds that require an
evaluation of the medical facts by a health care
professional in the specific case involved to de-
termine the coverage and extent of coverage of
the item or service or condition.
(3) INDEPENDENT
MEDICAL
REVIEW
DETER-
MINATION.—
(A) IN GENERAL.—An independent med-
ical reviewer under this section shall make a
new independent determination with respect to
whether or not the denial of a claim for a ben-
efit that is the subject of the review should be
upheld, reversed, or modified.
(B) STANDARD
FOR
DETERMINATION.—
The independent medical reviewer’s determina-
tion relating to the medical necessity and ap-
propriateness, or the experimental or investiga-
tional nature, or the evaluation of the medical
facts, of the item, service, or condition involved
shall be based on the medical condition of the
participant, beneficiary, or enrollee (including
the medical records of the participant, bene-
ficiary, or enrollee) and valid, relevant scientific
evidence and clinical evidence, including peer-re-
viewed medical literature or findings and in-
cluding expert opinion.
(C) NO COVERAGE FOR EXCLUDED BENE-
FITS.—Nothing in this subsection shall be con-
strued to permit an independent medical re-
viewer to require that a group health plan, or
health insurance issuer offering health insur-
ance coverage, provide coverage for items or
services for which benefits are specifically ex-
cluded or expressly limited under the plan or
coverage in the plain language of the plan docu-
ment (and which are disclosed under section
121(b)(1)(C)). Notwithstanding any other pro-
vision of this Act, any exclusion of an exact
medical procedure, any exact time limit on the
duration or frequency of coverage, and any
exact dollar limit on the amount of coverage
that is specifically enumerated and defined (in
the plain language of the plan or coverage docu-
ments) under the plan or coverage offered by a
group health plan or health insurance issuer of-
fering health insurance coverage and that is
disclosed under section 121(b)(1) shall be con-
sidered to govern the scope of the benefits that
may be required: Provided, That the terms and
conditions of the plan or coverage relating to
such an exclusion or limit are in compliance
with the requirements of law.
(D) EVIDENCE AND INFORMATION TO BE
USED IN MEDICAL REVIEWS.—In making a de-
termination under this subsection, the inde-
pendent medical reviewer shall also consider ap-
propriate and available evidence and informa-
tion, including the following:
(i) The determination made by the
plan or issuer with respect to the claim
upon internal review and the evidence,
guidelines, or rationale used by the plan or
issuer in reaching such determination.
(ii) The recommendation of the treat-
ing health care professional and the evi-
dence, guidelines, and rationale used by
the treating health care professional in
reaching such recommendation.
(iii) Additional relevant evidence or
information obtained by the reviewer or
submitted by the plan, issuer, participant,
beneficiary, or enrollee (or an authorized
representative), or treating health care
professional.
(iv) The plan or coverage document.
(E) INDEPENDENT
DETERMINATION.—In
making determinations under this section, a
qualified external review entity and an inde-
pendent medical reviewer shall—
(i) consider the claim under review
without deference to the determinations
made by the plan or issuer or the rec-
ommendation of the treating health care
professional (if any); and
(ii) consider, but not be bound by, the
definition used by the plan or issuer of
‘‘medically necessary and appropriate’’, or
‘‘experimental or investigational’’, or other
substantially equivalent terms that are
used by the plan or issuer to describe med-
ical necessity and appropriateness or ex-
perimental or investigational nature of the
treatment.
(F) DETERMINATION
OF
INDEPENDENT
MEDICAL REVIEWER.—An independent medical
reviewer shall, in accordance with the deadlines
described in subsection (e), prepare a written
determination to uphold, reverse, or modify the
denial under review. Such written determination
shall include—
(i) the determination of the reviewer;
(ii) the specific reasons of the re-
viewer for such determination, including a
summary of the clinical or scientific evi-
dence used in making the determination;
and
(iii) with respect to a determination to
reverse or modify the denial under review,
a timeframe within which the plan or
issuer must comply with such determina-
tion.
(G) NONBINDING NATURE OF ADDITIONAL
RECOMMENDATIONS.—In addition to the deter-
mination under subparagraph (F), the reviewer
may provide the plan or issuer and the treating
health care professional with additional rec-
ommendations in connection with such a deter-
mination, but any such recommendations shall
not affect (or be treated as part of) the deter-
mination and shall not be binding on the plan
or issuer.
(e) TIMELINES AND NOTIFICATIONS.—
(1) TIMELINES
FOR
INDEPENDENT
MEDICAL
REVIEW.—
(A) PRIOR
AUTHORIZATION
DETERMINA-
TION.—
(i) IN
GENERAL.—The independent
medical reviewer (or reviewers) shall make
a determination on a denial of a claim for
benefits that is referred to the reviewer
under subsection (c)(3) in accordance with
the medical exigencies of the case and as
soon as possible, but in no case later than
14 days after the date of receipt of infor-
mation under subsection (c)(2) if the re-
view involves a prior authorization of items
or services and in no case later than 21
days after the date the request for external
review is received.
(ii) EXPEDITED
DETERMINATION.—
Notwithstanding clause (i) and subject to
clause (iii), the independent medical re-
viewer (or reviewers) shall make an expe-
dited determination on a denial of a claim
for benefits described in clause (i), when a
request for such an expedited determina-
tion is made by a participant, beneficiary,
or enrollee (or authorized representative)
at any time during the process for making
(B) RETROSPECTIVE
DETERMINATION.—
The independent medical reviewer (or review-
ers) shall complete a review in the case of a ret-
rospective determination on an appeal of a de-
nial of a claim for benefits that is referred to
the reviewer under subsection (c)(3) in no case
later than 30 days after the date of receipt of
information under subsection (c)(2) and in no
case later than 60 days after the date the re-
quest for external review is received by the
qualified external review entity.
(2) NOTIFICATION
OF
DETERMINATION.—The
external review entity shall ensure that the plan or
issuer, the participant, beneficiary, or enrollee (or
authorized representative) and the treating health
care professional (if any) receives a copy of the writ-
ten determination of the independent medical re-
viewer prepared under subsection (d)(3)(F). Nothing
in this paragraph shall be construed as preventing
an entity or reviewer from providing an initial oral
notice of the reviewer’s determination.
(3) FORM
OF
NOTICES.—Determinations and
notices under this subsection shall be written in a
manner calculated to be understood by a participant.
(f) COMPLIANCE.—
(1) APPLICATION OF DETERMINATIONS.—
(A) EXTERNAL REVIEW DETERMINATIONS
BINDING ON PLAN.—The determinations of an
external review entity and an independent med-
ical reviewer under this section shall be binding
upon the plan or issuer involved.
(B) 
COMPLIANCE
WITH
DETERMINA-
TION.—If the determination of an independent
medical reviewer is to reverse or modify the de-
nial, the plan or issuer, upon the receipt of such
determination, shall authorize coverage to com-
ply with the medical reviewer’s determination in
accordance with the timeframe established by
the medical reviewer.
(2) FAILURE TO COMPLY.—
(A) IN GENERAL.—If a plan or issuer fails
to comply with the timeframe established under
paragraph (1)(B) with respect to a participant,
beneficiary, or enrollee, where such failure to
comply is caused by the plan or issuer, the par-
ticipant, beneficiary, or enrollee may obtain the
items or services involved (in a manner con-
sistent with the determination of the inde-
pendent external reviewer) from any provider
regardless of whether such provider is a partici-
pating provider under the plan or coverage.
(B) REIMBURSEMENT.—
(i) IN
GENERAL.—Where a partici-
pant, beneficiary, or enrollee obtains items
or services in accordance with subpara-
graph (A), the plan or issuer involved shall
provide for reimbursement of the costs of
such items or services. Such reimburse-
ment shall be made to the treating health
care professional or to the participant, ben-
eficiary, or enrollee (in the case of a partic-
ipant, beneficiary, or enrollee who pays for
the costs of such items or services).
(ii) AMOUNT.—The plan or issuer
shall fully reimburse a professional, partici-
pant, beneficiary, or enrollee under clause
(i) for the total costs of the items or serv-
ices provided (regardless of any plan limi-
tations that may apply to the coverage of
such items or services) so long as the items
or services were provided in a manner con-
sistent with the determination of the inde-
pendent medical reviewer.
(C) FAILURE
TO
REIMBURSE.—Where a
plan or issuer fails to provide reimbursement to
a professional, participant, beneficiary, or en-
rollee in accordance with this paragraph, the
professional, participant, beneficiary, or enrollee
may commence a civil action (or utilize other
remedies available under law) to recover only
the amount of any such reimbursement that is
owed by the plan or issuer and any necessary
legal costs or expenses (including attorney’s
fees) incurred in recovering such reimburse-
ment.
(D) AVAILABLE REMEDIES.—The remedies
provided under this paragraph are in addition
to any other available remedies.
(3) PENALTIES
AGAINST
AUTHORIZED
OFFI-
CIALS FOR REFUSING TO AUTHORIZE THE DETER-
MINATION OF AN EXTERNAL REVIEW ENTITY.—
(A) MONETARY PENALTIES.—
(i) IN
GENERAL.—In any case in
which the determination of an external re-
view entity is not followed by a group
health plan, or by a health insurance issuer
offering health insurance coverage, any
person who, acting in the capacity of au-
thorizing the benefit, causes such refusal
may, in the discretion of a court of com-
petent jurisdiction, be liable to an ag-
grieved participant, beneficiary, or enrollee
for a civil penalty in an amount of up to
$1,000 a day from the date on which the
determination was transmitted to the plan
or issuer by the external review entity until
the date the refusal to provide the benefit
is corrected.
(ii) ADDITIONAL PENALTY FOR FAIL-
ING TO FOLLOW TIMELINE.—In any case
in which treatment was not commenced by
the plan in accordance with the determina-
tion of an independent external reviewer,
the Secretary shall assess a civil penalty of
$10,000 against the plan and the plan
shall pay such penalty to the participant,
beneficiary, or enrollee involved.
(B) CEASE
AND
DESIST
ORDER
AND
ORDER OF ATTORNEY’S FEES.—In any action
described in subparagraph (A) brought by a
participant, beneficiary, or enrollee with respect
to a group health plan, or a health insurance
issuer offering health insurance coverage, in
which a plaintiff alleges that a person referred
to in such subparagraph has taken an action re-
sulting in a refusal of a benefit determined by
an external appeal entity to be covered, or has
failed to take an action for which such person
is responsible under the terms and conditions of
the plan or coverage and which is necessary
under the plan or coverage for authorizing a
benefit, the court shall cause to be served on
the 
defendant 
an 
order 
requiring 
the
defendant—
(i) to cease and desist from the al-
leged action or failure to act; and
(ii) to pay to the plaintiff a reasonable
attorney’s fee and other reasonable costs
relating to the prosecution of the action on
the charges on which the plaintiff prevails.
(C) ADDITIONAL CIVIL PENALTIES.—
(i) IN GENERAL.—In addition to any
penalty imposed under subparagraph (A)
or (B), the appropriate Secretary may as-
sess a civil penalty against a person acting
in the capacity of authorizing a benefit de-
termined by an external review entity for
one or more group health plans, or health
insurance issuers offering health insurance
coverage, for—
(I) any pattern or practice of re-
peated refusal to authorize a benefit
determined by an external appeal enti-
ty to be covered; or
(II) any pattern or practice of re-
peated violations of the requirements
of this section with respect to such
plan or coverage.
(ii) 
STANDARD
OF
PROOF
AND
AMOUNT OF PENALTY.—Such penalty shall
be payable only upon proof by clear and
convincing evidence of such pattern or
practice and shall be in an amount not to
exceed the lesser of—
(I) 25 percent of the aggregate
value of benefits shown by the appro-
priate Secretary to have not been pro-
vided, or unlawfully delayed, in viola-
tion of this section under such pattern
or practice; or
(II) $500,000.
(D) REMOVAL AND DISQUALIFICATION.—
Any person acting in the capacity of author-
izing benefits who has engaged in any such pat-
tern or practice described in subparagraph
(C)(i) with respect to a plan or coverage, upon
the petition of the appropriate Secretary, may
be removed by the court from such position,
and from any other involvement, with respect to
such a plan or coverage, and may be precluded
from returning to any such position or involve-
ment for a period determined by the court.
(4) PROTECTION OF LEGAL RIGHTS.—Nothing
in this subsection or subtitle shall be construed as
altering or eliminating any cause of action or legal
rights or remedies of participants, beneficiaries, en-
rollees, and others under State or Federal law (in-
cluding sections 502 and 503 of the Employee Re-
tirement Income Security Act of 1974), including
the right to file judicial actions to enforce rights.
(g) QUALIFICATIONS
OF INDEPENDENT MEDICAL
REVIEWERS.—
(1) IN GENERAL.—In referring a denial to 1 or
more individuals to conduct independent medical re-
view under subsection (c), the qualified external re-
view entity shall ensure that—
(A) each independent medical reviewer
meets the qualifications described in paragraphs
(2) and (3);
(B) with respect to each review at least 1
such reviewer meets the requirements described
in paragraphs (4) and (5); and
(C) compensation provided by the entity to
the reviewer is consistent with paragraph (6).
(2) LICENSURE AND EXPERTISE.—Each inde-
pendent medical reviewer shall be a physician
(allopathic or osteopathic) or health care profes-
sional who—
(A) is appropriately credentialed or li-
censed in 1 or more States to deliver health
care services; and
(B) typically treats the condition, makes
the diagnosis, or provides the type of treatment
under review.
(3) INDEPENDENCE.—
(A) IN
GENERAL.—Subject to subpara-
graph (B), each independent medical reviewer
in a case shall—
(i) not be a related party (as defined
in paragraph (7));
(ii) not have a material familial, fi-
nancial, or professional relationship with
such a party; and
(iii) not otherwise have a conflict of
interest with such a party (as determined
under regulations).
(B) EXCEPTION.—Nothing in subpara-
graph (A) shall be construed to—
(i) prohibit an individual, solely on the
basis of affiliation with the plan or issuer,
from serving as an independent medical re-
viewer if—
(I) a non-affiliated individual is
not reasonably available;
(II) the affiliated individual is
not involved in the provision of items
or services in the case under review;
(III) the fact of such an affili-
ation is disclosed to the plan or issuer
and the participant, beneficiary, or
enrollee (or authorized representative)
and neither party objects; and
(IV) the affiliated individual is
not an employee of the plan or issuer
and does not provide services exclu-
sively or primarily to or on behalf of
the plan or issuer;
(ii) prohibit an individual who has
staff privileges at the institution where the
treatment involved takes place from serv-
ing as an independent medical reviewer
merely on the basis of such affiliation if
the affiliation is disclosed to the plan or
issuer and the participant, beneficiary, or
enrollee (or authorized representative), and
neither party objects; or
(iii) prohibit receipt of compensation
by an independent medical reviewer from
an entity if the compensation is provided
consistent with paragraph (6).
(4) PRACTICING HEALTH CARE PROFESSIONAL
IN SAME FIELD.—
(A) IN
GENERAL.—In a case involving
treatment, or the provision of items or
services—
(i) by a physician, a reviewer shall be
a practicing physician (allopathic or osteo-
pathic) of the same or similar specialty, as
a physician who, acting within the appro-
priate scope of practice within the State in
which the service is provided or rendered,
typically treats the condition, makes the
diagnosis, or provides the type of treat-
ment under review; or
(ii) by a non-physician health care
professional, a reviewer (or reviewers) shall
include at least one practicing non-physi-
cian health care professional of the same
or similar specialty as the non-physician
health care professional who, acting within
the appropriate scope of practice within
the State in which the service is provided
or rendered, typically treats the condition,
makes the diagnosis, or provides the type
of treatment under review.
(B) PRACTICING DEFINED.—For purposes
of this paragraph, the term ‘‘practicing’’ means,
with respect to an individual who is a physician
or other health care professional that the indi-
vidual provides health care services to individual
patients on average at least 2 days per week.
(5) PEDIATRIC EXPERTISE.—In the case of an
external review relating to a child, a reviewer shall
have expertise under paragraph (2) in pediatrics.
(6) LIMITATIONS
ON
REVIEWER
COMPENSA-
TION.—Compensation provided by a qualified exter-
nal review entity to an independent medical reviewer
in connection with a review under this section
shall—
(A) not exceed a reasonable level; and
(B) not be contingent on the decision ren-
dered by the reviewer.
(7) RELATED PARTY DEFINED.—For purposes
of this section, the term ‘‘related party’’ means, with
respect to a denial of a claim under a plan or cov-
erage relating to a participant, beneficiary, or en-
rollee, any of the following:
(A) The plan, plan sponsor, or issuer in-
volved, or any fiduciary, officer, director, or em-
ployee of such plan, plan sponsor, or issuer.
(B) The participant, beneficiary, or en-
rollee (or authorized representative).
(C) The health care professional that pro-
vides the items or services involved in the de-
nial.
(D) The institution at which the items or
services (or treatment) involved in the denial
are provided.
(E) The manufacturer of any drug or
other item that is included in the items or serv-
ices involved in the denial.
(F) Any other party determined under any
regulations to have a substantial interest in the
denial involved.
(h) QUALIFIED EXTERNAL REVIEW ENTITIES.—
(1) SELECTION OF QUALIFIED EXTERNAL RE-
VIEW ENTITIES.—
(A) LIMITATION ON PLAN OR ISSUER SE-
LECTION.—The appropriate Secretary shall im-
plement procedures—
(i) to assure that the selection process
among qualified external review entities
will not create any incentives for external
review entities to make a decision in a bi-
ased manner; and
(ii) for auditing a sample of decisions
by such entities to assure that no such de-
cisions are made in a biased manner.
No such selection process under the procedures
implemented by the appropriate Secretary may
give either the patient or the plan or issuer any
ability to determine or influence the selection of
a qualified external review entity to review the
case of any participant, beneficiary, or enrollee.
(B) STATE AUTHORITY WITH RESPECT TO
QUALIFIED EXTERNAL REVIEW ENTITIES FOR
HEALTH INSURANCE ISSUERS.—With respect to
health insurance issuers offering health insur-
ance coverage in a State, the State may provide
for external review activities to be conducted by
a qualified external appeal entity that is des-
ignated by the State or that is selected by the
State in a manner determined by the State to
assure an unbiased determination.
(2) CONTRACT WITH QUALIFIED EXTERNAL RE-
VIEW
ENTITY.—Except as provided in paragraph
(1)(B), the external review process of a plan or
issuer under this section shall be conducted under a
contract between the plan or issuer and 1 or more
qualified external review entities (as defined in para-
graph (4)(A)).
(3) TERMS AND CONDITIONS OF CONTRACT.—
The terms and conditions of a contract under para-
graph (2) shall—
(A) be consistent with the standards the
appropriate Secretary shall establish to assure
there is no real or apparent conflict of interest
in the conduct of external review activities; and
(B) provide that the costs of the external
review process shall be borne by the plan or
issuer.
Subparagraph (B) shall not be construed as apply-
ing to the imposition of a filing fee under subsection
(b)(2)(A)(iv) or costs incurred by the participant,
beneficiary, or enrollee (or authorized representative)
or treating health care professional (if any) in sup-
port of the review, including the provision of addi-
tional evidence or information.
(4) QUALIFICATIONS.—
(A) IN
GENERAL.—In this section, the
term ‘‘qualified external review entity’’ means,
in relation to a plan or issuer, an entity that is
initially certified (and periodically recertified)
under subparagraph (C) as meeting the fol-
lowing requirements:
(i) The entity has (directly or through
contracts or other arrangements) sufficient
medical, legal, and other expertise and suf-
ficient staffing to carry out duties of a
qualified external review entity under this
section on a timely basis, including making
determinations under subsection (b)(2)(A)
and providing for independent medical re-
views under subsection (d).
(ii) The entity is not a plan or issuer
or an affiliate or a subsidiary of a plan or
issuer, and is not an affiliate or subsidiary
of a professional or trade association of
plans or issuers or of health care providers.
(iii) The entity has provided assur-
ances that it will conduct external review
activities consistent with the applicable re-
quirements of this section and standards
specified in subparagraph (C), including
that it will not conduct any external review
activities in a case unless the independence
requirements of subparagraph (B) are met
with respect to the case.
(iv) The entity has provided assur-
ances that it will provide information in a
timely manner under subparagraph (D).
(v) The entity meets such other re-
quirements as the appropriate Secretary
provides by regulation.
(B) INDEPENDENCE REQUIREMENTS.—
(i) IN
GENERAL.—Subject to clause
(ii), an entity meets the independence re-
quirements of this subparagraph with re-
spect to any case if the entity—
(I) is not a related party (as de-
fined in subsection (g)(7));
(II) does not have a material fa-
milial, financial, or professional rela-
tionship with such a party; and
(III) does not otherwise have a
conflict of interest with such a party
(as determined under regulations).
(ii) EXCEPTION
FOR
REASONABLE
COMPENSATION.—Nothing in clause (i)
shall be construed to prohibit receipt by a
qualified external review entity of com-
pensation from a plan or issuer for the
conduct of external review activities under
this section if the compensation is provided
consistent with clause (iii).
(iii) LIMITATIONS
ON
ENTITY
COM-
PENSATION.—Compensation provided by a
plan or issuer to a qualified external review
entity in connection with reviews under
this section shall—
(I) not exceed a reasonable level;
and
(II) not be contingent on any de-
cision rendered by the entity or by
any independent medical reviewer.
(C) CERTIFICATION AND RECERTIFICATION
PROCESS.—
(i) IN GENERAL.—The initial certifi-
cation and recertification of a qualified ex-
ternal review entity shall be made—
(I) under a process that is recog-
nized or approved by the appropriate
Secretary; or
(II) by a qualified private stand-
ard-setting organization that is ap-
proved by the appropriate Secretary
under clause (iii).
In taking action under subclause (I), the
appropriate Secretary shall give deference
to entities that are under contract with the
Federal Government or with an applicable
State authority to perform functions of the
type performed by qualified external review
entities.
(ii) PROCESS.—The appropriate Sec-
retary shall not recognize or approve a
process under clause (i)(I) unless the proc-
ess applies standards (as promulgated in
regulations) that ensure that a qualified
external review entity—
(I) will carry out (and has car-
ried out, in the case of recertification)
the responsibilities of such an entity
in accordance with this section, in-
cluding meeting applicable deadlines;
(II) will meet (and has met, in
the case of recertification) appropriate
indicators of fiscal integrity;
(III) will maintain (and has
maintained, in the case of recertifi-
cation) 
appropriate 
confidentiality
with respect to individually identifi-
able health information obtained in
the course of conducting external re-
view activities; and
(IV) in the case of recertification,
shall review the matters described in
clause (iv).
(iii) APPROVAL
OF
QUALIFIED
PRI-
VATE
STANDARD-SETTING
ORGANIZA-
TIONS.—For purposes of clause (i)(II), the
appropriate Secretary may approve a quali-
fied private standard-setting organization
if such Secretary finds that the organiza-
tion only certifies (or recertifies) external
review entities that meet at least the
standards required for the certification (or
recertification) of external review entities
under clause (ii).
(iv) CONSIDERATIONS IN RECERTIFI-
CATIONS.—In conducting recertifications of
a qualified external review entity under
this paragraph, the appropriate Secretary
or organization conducting the recertifi-
cation shall review compliance of the entity
with the requirements for conducting ex-
ternal review activities under this section,
including the following:
(I) 
Provision 
of 
information
under subparagraph (D).
(II) 
Adherence 
to 
applicable
deadlines (both by the entity and by
independent medical reviewers it re-
fers cases to).
(III) Compliance with limitations
on compensation (with respect to both
the entity and independent medical re-
viewers it refers cases to).
(IV) Compliance with applicable
independence requirements.
(V) Compliance with the require-
ment of subsection (d)(1) that only
medically reviewable decisions shall be
the subject of independent medical re-
view and with the requirement of sub-
section (d)(3) that independent med-
ical reviewers may not require cov-
erage for specifically excluded bene-
fits.
(v) PERIOD OF CERTIFICATION OR RE-
CERTIFICATION.—A certification or recer-
tification provided under this paragraph
shall extend for a period not to exceed 2
years.
(vi) REVOCATION.—A certification or
recertification under this paragraph may
be revoked by the appropriate Secretary or
by the organization providing such certifi-
cation upon a showing of cause. The Sec-
retary, or organization, shall revoke a cer-
tification or deny a recertification with re-
spect to an entity if there is a showing that
the entity has a pattern or practice of or-
dering coverage for benefits that are spe-
cifically excluded under the plan or cov-
erage.
(vii) PETITION FOR DENIAL OR WITH-
DRAWAL.—An individual may petition the
Secretary, or an organization providing the
certification involves, for a denial of recer-
tification or a withdrawal of a certification
with respect to an entity under this sub-
paragraph if there is a pattern or practice
of such entity failing to meet a require-
ment of this section.
(viii) SUFFICIENT NUMBER OF ENTI-
TIES.—The appropriate Secretary shall
certify and recertify a number of external
review entities which is sufficient to ensure
the timely and efficient provision of review
services.
(D) PROVISION OF INFORMATION.—
(i) IN GENERAL.—A qualified external
review entity shall provide to the appro-
priate Secretary, in such manner and at
such times as such Secretary may require,
such information (relating to the denials
which have been referred to the entity for
the conduct of external review under this
section) as such Secretary determines ap-
propriate to assure compliance with the
independence and other requirements of
this section to monitor and assess the qual-
ity of its external review activities and lack
of bias in making determinations. Such in-
formation shall include information de-
scribed in clause (ii) but shall not include
individually identifiable medical informa-
tion.
(ii) 
INFORMATION
TO
BE
IN-
CLUDED.—The information described in
this subclause with respect to an entity is
as follows:
(I) The number and types of de-
nials for which a request for review
has been received by the entity.
(II) The disposition by the entity
of such denials, including the number
referred to a independent medical re-
viewer and the reasons for such dis-
positions (including the application of
exclusions), on a plan or issuer-spe-
cific basis and on a health care spe-
cialty-specific basis.
(III) The length of time in mak-
ing determinations with respect to
such denials.
(IV) Updated information on the
information required to be submitted
as a condition of certification with re-
spect to the entity’s performance of
external review activities.
(iii) INFORMATION TO BE PROVIDED
TO CERTIFYING ORGANIZATION.—
(I) IN GENERAL.—In the case of
a qualified external review entity
which is certified (or recertified)
under this subsection by a qualified
private standard-setting organization,
at the request of the organization, the
entity shall provide the organization
with the information provided to the
appropriate Secretary under clause
(i).
(II) 
ADDITIONAL
INFORMA-
TION.—Nothing in this subparagraph
shall be construed as preventing such
an organization from requiring addi-
tional information as a condition of
certification or recertification of an
entity.
(iv) USE OF INFORMATION.—Informa-
tion provided under this subparagraph may
be used by the appropriate Secretary and
qualified private standard-setting organiza-
tions to conduct oversight of qualified ex-
ternal review entities, including recertifi-
cation of such entities, and shall be made
available to the public in an appropriate
manner.
(E) LIMITATION ON LIABILITY.—No quali-
fied external review entity having a contract
with a plan or issuer, and no person who is em-
ployed by any such entity or who furnishes pro-
fessional services to such entity (including as an
independent medical reviewer), shall be held by
reason of the performance of any duty, func-
tion, or activity required or authorized pursuant
to this section, to be civilly liable under any law
of the United States or of any State (or polit-
ical subdivision thereof) if there was no actual
malice or gross misconduct in the performance
of such duty, function, or activity.
(5) REPORT.—Not later than 12 months after
the general effective date referred to in section 601,
the General Accounting Office shall prepare and
submit to the appropriate committees of Congress a
report concerning—
(A) the information that is provided under
paragraph (3)(D);
(B) the number of denials that have been
upheld by independent medical reviewers and
the number of denials that have been reversed
by such reviewers; and
(C) the extent to which independent med-
ical reviewers are requiring coverage for bene-
fits that are specifically excluded under the plan
or coverage.
SEC. 105. HEALTH CARE CONSUMER ASSISTANCE FUND.
(a) GRANTS.—
(1) IN GENERAL.—The Secretary of Health and
Human Services (referred to in this section as the
‘‘Secretary’’) shall establish a fund, to be known as
the ‘‘Health Care Consumer Assistance Fund’’, to be
used to award grants to eligible States to carry out
consumer assistance activities (including programs
established by States prior to the enactment of this
Act) designed to provide information, assistance, and
referrals to consumers of health insurance products.
(2) STATE ELIGIBILITY.—To be eligible to re-
ceive a grant under this subsection a State shall pre-
pare and submit to the Secretary an application at
such time, in such manner, and containing such in-
formation as the Secretary may require, including a
State plan that describes—
(A) the manner in which the State will en-
sure that the health care consumer assistance
office (established under paragraph (4)) will
educate and assist health care consumers in ac-
cessing needed care;
(B) the manner in which the State will co-
ordinate and distinguish the services provided
by the health care consumer assistance office
with the services provided by Federal, State and
local health-related ombudsman, information,
protection and advocacy, insurance, and fraud
and abuse programs;
(C) the manner in which the State will
provide information, outreach, and services to
underserved, minority populations with limited
English proficiency and populations residing in
rural areas;
(D) the manner in which the State will
oversee the health care consumer assistance of-
fice, its activities, product materials and evalu-
ate program effectiveness;
(E) the manner in which the State will en-
sure that funds made available under this sec-
tion will be used to supplement, and not sup-
plant, any other Federal, State, or local funds
expended to provide services for programs de-
scribed under this section and those described
in subparagraphs (C) and (D);
(F) the manner in which the State will en-
sure that health care consumer office personnel
have the professional background and training
to carry out the activities of the office; and
(G) the manner in which the State will en-
sure that consumers have direct access to con-
sumer assistance personnel during regular busi-
ness hours.
(3) AMOUNT OF GRANT.—
(A) IN GENERAL.—From amounts appro-
priated under subsection (b) for a fiscal year,
the Secretary shall award a grant to a State in
an amount that bears the same ratio to such
amounts as the number of individuals within
the State covered under a group health plan or
under health insurance coverage offered by a
health insurance issuer bears to the total num-
ber of individuals so covered in all States (as
determined by the Secretary). Any amounts
provided to a State under this subsection that
are not used by the State shall be remitted to
the Secretary and reallocated in accordance
with this subparagraph.
(B) MINIMUM AMOUNT.—In no case shall
the amount provided to a State under a grant
under this subsection for a fiscal year be less
than an amount equal to 0.5 percent of the
amount appropriated for such fiscal year to
carry out this section.
(C) NON-FEDERAL
CONTRIBUTIONS.—A
State will provide for the collection of non-Fed-
eral contributions for the operation of the office
in an amount that is not less than 25 percent
of the amount of Federal funds provided to the
State under this section.
(4) PROVISION OF FUNDS FOR ESTABLISHMENT
OF OFFICE.—
(A) IN
GENERAL.—From amounts pro-
vided under a grant under this subsection, a
State shall, directly or through a contract with
an independent, nonprofit entity with dem-
onstrated experience in serving the needs of
health care consumers, provide for the estab-
lishment and operation of a State health care
consumer assistance office.
(B) ELIGIBILITY OF ENTITY.—To be eligi-
ble to enter into a contract under subparagraph
(A), an entity shall demonstrate that it has the
technical, organizational, and professional ca-
pacity to deliver the services described in sub-
section (b) to all public and private health in-
surance participants, beneficiaries, enrollees, or
prospective enrollees.
(C) EXISTING STATE ENTITY.—Nothing in
this section shall prevent the funding of an ex-
isting health care consumer assistance program
that otherwise meets the requirements of this
section.
(b) USE OF FUNDS.—
(1) BY STATE.—A State shall use amounts pro-
vided under a grant awarded under this section to
carry out consumer assistance activities directly or
by contract with an independent, non-profit organi-
zation. An eligible entity may use some reasonable
amount of such grant to ensure the adequate train-
ing of personnel carrying out such activities. To re-
ceive amounts under this subsection, an eligible enti-
ty shall provide consumer assistance services,
including—
(A) the operation of a toll-free telephone
hotline to respond to consumer requests;
(B) the dissemination of appropriate edu-
cational materials on available health insurance
products and on how best to access health care
and the rights and responsibilities of health
care consumers;
(C) the provision of education on effective
methods to promptly and efficiently resolve
questions, problems, and grievances;
(D) the coordination of educational and
outreach efforts with health plans, health care
providers, payers, and governmental agencies;
(E) referrals to appropriate private and
public entities to resolve questions, problems
and grievances; and
(F) the provision of information and as-
sistance, including acting as an authorized rep-
resentative, regarding internal, external, or ad-
ministrative grievances or appeals procedures in
nonlitigative settings to appeal the denial, ter-
mination, or reduction of health care services,
or the refusal to pay for such services, under a
group health plan or health insurance coverage
offered by a health insurance issuer.
(2) CONFIDENTIALITY AND ACCESS TO INFOR-
MATION.—
(A) STATE
ENTITY.—With respect to a
State that directly establishes a health care con-
sumer assistance office, such office shall estab-
lish and implement procedures and protocols in
accordance with applicable Federal and State
laws.
(B) CONTRACT ENTITY.—With respect to a
State that, through contract, establishes a
health care consumer assistance office, such of-
fice shall establish and implement procedures
and protocols, consistent with applicable Fed-
eral and State laws, to ensure the confiden-
tiality of all information shared by a partici-
pant, beneficiary, enrollee, or their personal
representative and their health care providers,
group health plans, or health insurance insurers
with the office and to ensure that no such infor-
mation is used by the office, or released or dis-
closed to State agencies or outside persons or
entities without the prior written authorization
(in accordance with section 164.508 of title 45,
Code of Federal Regulations) of the individual
or personal representative. The office may, con-
sistent with applicable Federal and State con-
fidentiality laws, collect, use or disclose aggre-
gate information that is not individually identi-
fiable (as defined in section 164.501 of title 45,
Code of Federal Regulations). The office shall
provide a written description of the policies and
procedures of the office with respect to the
manner in which health information may be
used or disclosed to carry out consumer assist-
ance activities. The office shall provide health
care providers, group health plans, or health in-
surance issuers with a written authorization (in
accordance with section 164.508 of title 45,
Code of Federal Regulations) to allow the office
to obtain medical information relevant to the
matter before the office.
(3) AVAILABILITY
OF
SERVICES.—The health
care consumer assistance office of a State shall not
discriminate in the provision of information, refer-
rals, and services regardless of the source of the in-
dividual’s health insurance coverage or prospective
coverage, including individuals covered under a
group health plan or health insurance coverage of-
fered by a health insurance issuer, the medicare or
medicaid programs under title XVIII or XIX of the
Social Security Act (42 U.S.C. 1395 and 1396 et
seq.), or under any other Federal or State health
care program.
(4) DESIGNATION OF RESPONSIBILITIES.—
(A) WITHIN EXISTING STATE ENTITY.—If
the health care consumer assistance office of a
State is located within an existing State regu-
latory agency or office of an elected State offi-
cial, the State shall ensure that—
(i) there is a separate delineation of
the funding, activities, and responsibilities
of the office as compared to the other
funding, activities, and responsibilities of
the agency; and
(ii) the office establishes and imple-
ments procedures and protocols to ensure
the 
confidentiality 
of 
all 
information
shared by a participant, beneficiary, or en-
rollee or their personal representative and
their health care providers, group health
plans, or health insurance issuers with the
office and to ensure that no information is
disclosed to the State agency or office
without the written authorization of the in-
dividual or their personal representative in
accordance with paragraph (2).
(B) CONTRACT ENTITY.—In the case of an
entity that enters into a contract with a State
under subsection (a)(3), the entity shall provide
assurances that the entity has no conflict of in-
terest in carrying out the activities of the office
and that the entity is independent of group
health plans, health insurance issuers, pro-
viders, payers, and regulators of health care.
(5) SUBCONTRACTS.—The health care con-
sumer assistance office of a State may carry out ac-
tivities and provide services through contracts en-
tered into with 1 or more nonprofit entities so long
as the office can demonstrate that all of the require-
ments of this section are complied with by the office.
(6) TERM.—A contract entered into under this
subsection shall be for a term of 3 years.
(c) REPORT.—Not later than 1 year after the Sec-
retary first awards grants under this section, and annually
thereafter, the Secretary shall prepare and submit to the
appropriate committees of Congress a report concerning
the activities funded under this section and the effective-
ness of such activities in resolving health care-related
problems and grievances.
(d) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated such sums as may be
necessary to carry out this section.
Subtitle B—Access to Care
SEC. 111. CONSUMER CHOICE OPTION.
(a) IN GENERAL.—If—
(1) a health insurance issuer providing health
insurance coverage in connection with a group health
plan offers to enrollees health insurance coverage
which provides for coverage of services (including
physician pathology services) only if such services
are furnished through health care professionals and
providers who are members of a network of health
care professionals and providers who have entered
into a contract with the issuer to provide such serv-
ices, or
(2) a group health plan offers to participants or
beneficiaries health benefits which provide for cov-
erage of services only if such services are furnished
through health care professionals and providers who
are members of a network of health care profes-
sionals and providers who have entered into a con-
tract with the plan to provide such services,
then the issuer or plan shall also offer or arrange to be
offered to such enrollees, participants, or beneficiaries (at
the time of enrollment and during an annual open season
as provided under subsection (c)) the option of health in-
surance coverage or health benefits which provide for cov-
erage of such services which are not furnished through
health care professionals and providers who are members
of such a network unless such enrollees, participants, or
beneficiaries are offered such non-network coverage
through another group health plan or through another
health insurance issuer in the group market.
(b) ADDITIONAL COSTS.—The amount of any addi-
tional premium charged by the health insurance issuer or
group health plan for the additional cost of the creation
and maintenance of the option described in subsection (a)
and the amount of any additional cost sharing imposed
under such option shall be borne by the enrollee, partici-
pant, or beneficiary unless it is paid by the health plan
sponsor or group health plan through agreement with the
health insurance issuer.
(c) OPEN SEASON.—An enrollee, participant, or ben-
eficiary, may change to the offering provided under this
section only during a time period determined by the health
insurance issuer or group health plan. Such time period
shall occur at least annually.
SEC. 112. CHOICE OF HEALTH CARE PROFESSIONAL.
(a) PRIMARY CARE.—If a group health plan, or a
health insurance issuer that offers health insurance cov-
erage, requires or provides for designation by a partici-
pant, beneficiary, or enrollee of a participating primary
care provider, then the plan or issuer shall permit each
participant, beneficiary, and enrollee to designate any par-
ticipating primary care provider who is available to accept
such individual.
(b) SPECIALISTS.—
(1) IN GENERAL.—Subject to paragraph (2), a
group health plan and a health insurance issuer that
offers health insurance coverage shall permit each
participant, beneficiary, or enrollee to receive medi-
cally necessary and appropriate specialty care, pur-
suant to appropriate referral procedures, from any
qualified participating health care professional who
is available to accept such individual for such care.
(2) LIMITATION.—Paragraph (1) shall not
apply to specialty care if the plan or issuer clearly
informs participants, beneficiaries, and enrollees of
the limitations on choice of participating health care
professionals with respect to such care.
(3) CONSTRUCTION.—Nothing in this sub-
section shall be construed as affecting the applica-
tion of section 114 (relating to access to specialty
care).
SEC. 113. ACCESS TO EMERGENCY CARE.
(a) COVERAGE OF EMERGENCY SERVICES.—
(1) IN GENERAL.—If a group health plan, or
health insurance coverage offered by a health insur-
ance issuer, provides or covers any benefits with re-
spect to services in an emergency department of a
hospital, the plan or issuer shall cover emergency
services (as defined in paragraph (2)(B))—
(A) without the need for any prior author-
ization determination;
(B) whether the health care provider fur-
nishing such services is a participating provider
with respect to such services;
(C) in a manner so that, if such services
are provided to a participant, beneficiary, or
enrollee—
(i) by a nonparticipating health care
provider with or without prior authoriza-
tion, or
(ii) by a participating health care pro-
vider without prior authorization,
the participant, beneficiary, or enrollee is not
liable for amounts that exceed the amounts of
liability that would be incurred if the services
were provided by a participating health care
provider with prior authorization; and
(D) without regard to any other term or
condition of such coverage (other than exclusion
or coordination of benefits, or an affiliation or
waiting period, permitted under section 2701 of
the Public Health Service Act, section 701 of
the Employee Retirement Income Security Act
of 1974, or section 9801 of the Internal Rev-
enue Code of 1986, and other than applicable
cost-sharing).
(2) DEFINITIONS.—In this section:
(A) EMERGENCY
MEDICAL
CONDITION.—
The term ‘‘emergency medical condition’’ means
a medical condition manifesting itself by acute
symptoms of sufficient severity (including se-
vere pain) such that a prudent layperson, who
possesses an average knowledge of health and
medicine, could reasonably expect the absence
of immediate medical attention to result in a
condition described in clause (i), (ii), or (iii) of
section 1867(e)(1)(A) of the Social Security
Act.
(B) EMERGENCY
SERVICES.—The term
‘‘emergency services’’ means, with respect to an
emergency medical condition—
(i) a medical screening examination
(as required under section 1867 of the So-
cial Security Act) that is within the capa-
bility of the emergency department of a
hospital, including ancillary services rou-
tinely available to the emergency depart-
ment to evaluate such emergency medical
condition, and
(ii) within the capabilities of the staff
and facilities available at the hospital, such
further medical examination and treatment
as are required under section 1867 of such
Act to stabilize the patient.
(C) STABILIZE.—The term ‘‘to stabilize’’,
with respect to an emergency medical condition
(as defined in subparagraph (A)), has the
meaning given in section 1867(e)(3) of the So-
cial Security Act (42 U.S.C. 1395dd(e)(3)).
(b) REIMBURSEMENT FOR MAINTENANCE CARE AND
POST-STABILIZATION CARE.—A group health plan, and
health insurance coverage offered by a health insurance
issuer, must provide reimbursement for maintenance care
and post-stabilization care in accordance with the require-
ments of section 1852(d)(2) of the Social Security Act (42
U.S.C. 1395w–22(d)(2)). Such reimbursement shall be
provided in a manner consistent with subsection (a)(1)(C).
(c) COVERAGE OF EMERGENCY AMBULANCE SERV-
ICES.—
(1) IN GENERAL.—If a group health plan, or
health insurance coverage provided by a health in-
surance issuer, provides any benefits with respect to
ambulance services and emergency services, the plan
or issuer shall cover emergency ambulance services
(as defined in paragraph (2)) furnished under the
plan or coverage under the same terms and condi-
tions under subparagraphs (A) through (D) of sub-
section (a)(1) under which coverage is provided for
emergency services.
(2) EMERGENCY AMBULANCE SERVICES.—For
purposes of this subsection, the term ‘‘emergency
ambulance services’’ means ambulance services (as
defined for purposes of section 1861(s)(7) of the So-
cial Security Act) furnished to transport an indi-
vidual who has an emergency medical condition (as
defined in subsection (a)(2)(A)) to a hospital for the
receipt of emergency services (as defined in sub-
section (a)(2)(B)) in a case in which the emergency
services are covered under the plan or coverage pur-
suant to subsection (a)(1) and a prudent layperson,
with an average knowledge of health and medicine,
could reasonably expect that the absence of such
transport would result in placing the health of the
individual in serious jeopardy, serious impairment of
bodily function, or serious dysfunction of any bodily
organ or part.
SEC. 114. TIMELY ACCESS TO SPECIALISTS.
(a) TIMELY ACCESS.—
(1) IN GENERAL.—A group health plan and a
health insurance issuer offering health insurance
coverage shall ensure that participants, beneficiaries,
and enrollees receive timely access to specialists who
are appropriate to the condition of, and accessible
to, the participant, beneficiary, or enrollee, when
such specialty care is a covered benefit under the
plan or coverage.
(2) RULE
OF
CONSTRUCTION.—Nothing in
paragraph (1) shall be construed—
(A) to require the coverage under a group
health plan or health insurance coverage of ben-
efits or services;
(B) to prohibit a plan or issuer from in-
cluding providers in the network only to the ex-
tent necessary to meet the needs of the plan’s
or issuer’s participants, beneficiaries, or enroll-
ees; or
(C) to override any State licensure or
scope-of-practice law.
(3) ACCESS TO CERTAIN PROVIDERS.—
(A) IN
GENERAL.—With respect to spe-
cialty care under this section, if a participating
specialist is not available and qualified to pro-
vide such care to the participant, beneficiary, or
enrollee, the plan or issuer shall provide for cov-
erage of such care by a nonparticipating spe-
cialist.
(B) TREATMENT
OF
NONPARTICIPATING
PROVIDERS.—If a participant, beneficiary, or
enrollee receives care from a nonparticipating
specialist pursuant to subparagraph (A), such
specialty care shall be provided at no additional
cost to the participant, beneficiary, or enrollee
beyond what the participant, beneficiary, or en-
rollee would otherwise pay for such specialty
care if provided by a participating specialist.
(b) REFERRALS.—
(1) AUTHORIZATION.—Subject to subsection
(a)(1), a group health plan or health insurance
issuer may require an authorization in order to ob-
tain coverage for specialty services under this sec-
tion. Any such authorization—
(A) shall be for an appropriate duration of
time or number of referrals, including an au-
thorization for a standing referral where appro-
priate; and
(B) may not be refused solely because the
authorization involves services of a nonpartici-
pating 
specialist 
(described 
in 
subsection
(a)(3)).
(2) REFERRALS FOR ONGOING SPECIAL CONDI-
TIONS.—
(A) IN GENERAL.—Subject to subsection
(a)(1), a group health plan and a health insur-
ance issuer shall permit a participant, bene-
ficiary, or enrollee who has an ongoing special
condition (as defined in subparagraph (B)) to
receive a referral to a specialist for the treat-
ment of such condition and such specialist may
authorize such referrals, procedures, tests, and
other medical services with respect to such con-
dition, or coordinate the care for such condi-
tion, subject to the terms of a treatment plan
(if any) referred to in subsection (c) with re-
spect to the condition.
(B) ONGOING
SPECIAL
CONDITION
DE-
FINED.—In this subsection, the term ‘‘ongoing
special condition’’ means a condition or disease
that—
(i) is life-threatening, degenerative,
potentially disabling, or congenital; and
(ii) requires specialized medical care
over a prolonged period of time.
(c) TREATMENT PLANS.—
(1) IN
GENERAL.—A group health plan or
health insurance issuer may require that the spe-
cialty care be provided—
(A) pursuant to a treatment plan, but only
if the treatment plan—
(i) is developed by the specialist, in
consultation with the case manager or pri-
mary care provider, and the participant,
beneficiary, or enrollee, and
(ii) is approved by the plan or issuer
in a timely manner, if the plan or issuer
requires such approval; and
(B) in accordance with applicable quality
assurance and utilization review standards of
the plan or issuer.
(2) NOTIFICATION.—Nothing in paragraph (1)
shall be construed as prohibiting a plan or issuer
from requiring the specialist to provide the plan or
issuer with regular updates on the specialty care
provided, as well as all other reasonably necessary
medical information.
(d) SPECIALIST DEFINED.—For purposes of this sec-
tion, the term ‘‘specialist’’ means, with respect to the con-
dition of the participant, beneficiary, or enrollee, a health
care professional, facility, or center that has adequate ex-
pertise through appropriate training and experience (in-
cluding, in the case of a child, appropriate pediatric exper-
tise) to provide high quality care in treating the condition.
SEC. 115. PATIENT ACCESS TO OBSTETRICAL AND GYNECO-
LOGICAL CARE.
(a) GENERAL RIGHTS.—
(1) DIRECT ACCESS.—A group health plan, and
a health insurance issuer offering health insurance
coverage, described in subsection (b) may not re-
quire authorization or referral by the plan, issuer, or
any person (including a primary care provider de-
scribed in subsection (b)(2)) in the case of a female
participant, beneficiary, or enrollee who seeks cov-
erage for obstetrical or gynecological care provided
by a participating health care professional who spe-
cializes in obstetrics or gynecology.
(2) 
OBSTETRICAL
AND
GYNECOLOGICAL
CARE.—A group health plan and a health insurance
issuer described in subsection (b) shall treat the pro-
vision of obstetrical and gynecological care, and the
ordering of related obstetrical and gynecological
items and services, pursuant to the direct access de-
scribed under paragraph (1), by a participating
health care professional who specializes in obstetrics
or gynecology as the authorization of the primary
care provider.
(b) APPLICATION OF SECTION.—A group health plan,
or health insurance issuer offering health insurance cov-
erage, described in this subsection is a group health plan
or coverage that—
(1) 
provides 
coverage 
for 
obstetric 
or
gynecologic care; and
(2) requires the designation by a participant,
beneficiary, or enrollee of a participating primary
care provider.
(c) CONSTRUCTION.—Nothing in subsection (a) shall
be construed to—
(1) waive any exclusions of coverage under the
terms and conditions of the plan or health insurance
coverage with respect to coverage of obstetrical or
gynecological care; or
(2) preclude the group health plan or health in-
surance issuer involved from requiring that the ob-
stetrical or gynecological provider notify the primary
care health care professional or the plan or issuer of
treatment decisions.
SEC. 116. ACCESS TO PEDIATRIC CARE.
(a) PEDIATRIC CARE.—In the case of a person who
has a child who is a participant, beneficiary, or enrollee
under a group health plan, or health insurance coverage
offered by a health insurance issuer, if the plan or issuer
requires or provides for the designation of a participating
primary care provider for the child, the plan or issuer shall
permit such person to designate a physician (allopathic or
osteopathic) who specializes in pediatrics as the child’s pri-
mary care provider if such provider participates in the net-
work of the plan or issuer.
(b) CONSTRUCTION.—Nothing in subsection (a) shall
be construed to waive any exclusions of coverage under
the terms and conditions of the plan or health insurance
coverage with respect to coverage of pediatric care.
SEC. 117. CONTINUITY OF CARE.
(a) TERMINATION OF PROVIDER.—
(1) IN GENERAL.—If—
(A) a contract between a group health
plan, or a health insurance issuer offering
health insurance coverage, and a treating health
care provider is terminated (as defined in para-
graph (e)(4)), or
(B) benefits or coverage provided by a
health care provider are terminated because of
a change in the terms of provider participation
in such plan or coverage,
the plan or issuer shall meet the requirements of
paragraph (3) with respect to each continuing care
patient.
(2) TREATMENT
OF
TERMINATION
OF
CON-
TRACT
WITH
HEALTH
INSURANCE
ISSUER.—If a
contract for the provision of health insurance cov-
erage between a group health plan and a health in-
surance issuer is terminated and, as a result of such
termination, coverage of services of a health care
provider is terminated with respect to an individual,
the provisions of paragraph (1) (and the succeeding
provisions of this section) shall apply under the plan
in the same manner as if there had been a contract
between the plan and the provider that had been ter-
minated, but only with respect to benefits that are
covered under the plan after the contract termi-
nation.
(3) REQUIREMENTS.—The requirements of this
paragraph are that the plan or issuer—
(A) notify the continuing care patient in-
volved, or arrange to have the patient notified
pursuant to subsection (d)(2), on a timely basis
of the termination described in paragraph (1)
(or paragraph (2), if applicable) and the right
to elect continued transitional care from the
provider under this section;
(B) provide the patient with an oppor-
tunity to notify the plan or issuer of the pa-
tient’s need for transitional care; and
(C) subject to subsection (c), permit the
patient to elect to continue to be covered with
respect to the course of treatment by such pro-
vider with the provider’s consent during a tran-
sitional period (as provided for under subsection
(b)).
(4) CONTINUING CARE PATIENT.—For purposes
of this section, the term ‘‘continuing care patient’’
means a participant, beneficiary, or enrollee who—
(A) is undergoing a course of treatment
for a serious and complex condition from the
provider at the time the plan or issuer receives
or provides notice of provider, benefit, or cov-
erage termination described in paragraph (1)
(or paragraph (2), if applicable);
(B) is undergoing a course of institutional
or inpatient care from the provider at the time
of such notice;
(C) is scheduled to undergo non-elective
surgery from the provider at the time of such
notice;
(D) is pregnant and undergoing a course
of treatment for the pregnancy from the pro-
vider at the time of such notice; or
(E) is or was determined to be terminally
ill (as determined under section 1861(dd)(3)(A)
of the Social Security Act) at the time of such
notice, but only with respect to a provider that
was treating the terminal illness before the date
of such notice.
(b) TRANSITIONAL PERIODS.—
(1) SERIOUS AND COMPLEX CONDITIONS.—The
transitional period under this subsection with re-
spect to a continuing care patient described in sub-
section (a)(4)(A) shall extend for up to 90 days (as
determined by the treating health care professional)
from the date of the notice described in subsection
(a)(3)(A).
(2) INSTITUTIONAL OR INPATIENT CARE.—The
transitional period under this subsection for a con-
tinuing 
care 
patient 
described 
in 
subsection
(a)(4)(B) shall extend until the earlier of—
(A) the expiration of the 90-day period be-
ginning on the date on which the notice under
subsection (a)(3)(A) is provided; or
(B) the date of discharge of the patient
from such care or the termination of the period
of institutionalization, or, if later, the date of
completion of reasonable follow-up care.
(3) SCHEDULED
NON-ELECTIVE
SURGERY.—
The transitional period under this subsection for a
continuing care patient described in subsection
(a)(4)(C) shall extend until the completion of the
surgery involved and post-surgical follow-up care re-
lating to the surgery and occurring within 90 days
after the date of the surgery.
(4) 
PREGNANCY.—The 
transitional 
period
under this subsection for a continuing care patient
described in subsection (a)(4)(D) shall extend
through the provision of post-partum care directly
related to the delivery.
(5) TERMINAL ILLNESS.—The transitional pe-
riod under this subsection for a continuing care pa-
tient described in subsection (a)(4)(E) shall extend
for the remainder of the patient’s life for care that
is directly related to the treatment of the terminal
illness or its medical manifestations.
(c) PERMISSIBLE
TERMS
AND
CONDITIONS.—A
group health plan or health insurance issuer may condi-
tion coverage of continued treatment by a provider under
this section upon the provider agreeing to the following
terms and conditions:
(1) The treating health care provider agrees to
accept reimbursement from the plan or issuer and
continuing care patient involved (with respect to
cost-sharing) at the rates applicable prior to the
start of the transitional period as payment in full
(or, in the case described in subsection (a)(2), at the
rates applicable under the replacement plan or cov-
erage after the date of the termination of the con-
tract with the group health plan or health insurance
issuer) and not to impose cost-sharing with respect
to the patient in an amount that would exceed the
cost-sharing that could have been imposed if the
contract referred to in subsection (a)(1) had not
been terminated.
(2) The treating health care provider agrees to
adhere to the quality assurance standards of the
plan or issuer responsible for payment under para-
graph (1) and to provide to such plan or issuer nec-
essary medical information related to the care pro-
vided.
(3) The treating health care provider agrees
otherwise to adhere to such plan’s or issuer’s policies
and procedures, including procedures regarding re-
ferrals and obtaining prior authorization and pro-
viding services pursuant to a treatment plan (if any)
approved by the plan or issuer.
(d) RULES OF CONSTRUCTION.—Nothing in this sec-
tion shall be construed—
(1) to require the coverage of benefits which
would not have been covered if the provider involved
remained a participating provider; or
(2) with respect to the termination of a con-
tract under subsection (a) to prevent a group health
plan or health insurance issuer from requiring that
the health care provider—
(A) notify participants, beneficiaries, or en-
rollees of their rights under this section; or
(B) provide the plan or issuer with the
name of each participant, beneficiary, or en-
rollee who the provider believes is a continuing
care patient.
(e) DEFINITIONS.—In this section:
(1) CONTRACT.—The term ‘‘contract’’ includes,
with respect to a plan or issuer and a treating
health care provider, a contract between such plan
100
or issuer and an organized network of providers that
includes the treating health care provider, and (in
the case of such a contract) the contract between the
treating health care provider and the organized net-
work.
(2) HEALTH
CARE
PROVIDER.—The term
‘‘health care provider’’ or ‘‘provider’’ means—
(A) any individual who is engaged in the
delivery of health care services in a State and
who is required by State law or regulation to be
licensed or certified by the State to engage in
the delivery of such services in the State; and
(B) any entity that is engaged in the deliv-
ery of health care services in a State and that,
if it is required by State law or regulation to be
licensed or certified by the State to engage in
the delivery of such services in the State, is so
licensed.
(3) SERIOUS AND COMPLEX CONDITION.—The
term ‘‘serious and complex condition’’ means, with
respect to a participant, beneficiary, or enrollee
under the plan or coverage—
(A) in the case of an acute illness, a condi-
tion that is serious enough to require special-
101
ized medical treatment to avoid the reasonable
possibility of death or permanent harm; or
(B) in the case of a chronic illness or con-
dition, is an ongoing special condition (as de-
fined in section 114(b)(2)(B)).
(4) TERMINATED.—The term ‘‘terminated’’ in-
cludes, with respect to a contract, the expiration or
nonrenewal of the contract, but does not include a
termination of the contract for failure to meet appli-
cable quality standards or for fraud.
SEC. 118. ACCESS TO NEEDED PRESCRIPTION DRUGS.
(a) IN GENERAL.—To the extent that a group health
plan, or health insurance coverage offered by a health in-
surance issuer, provides coverage for benefits with respect
to prescription drugs, and limits such coverage to drugs
included in a formulary, the plan or issuer shall—
(1) ensure the participation of physicians and
pharmacists in developing and reviewing such for-
mulary;
(2) provide for disclosure of the formulary to
providers; and
(3) in accordance with the applicable quality as-
surance and utilization review standards of the plan
or issuer, provide for exceptions from the formulary
limitation when a non-formulary alternative is medi-
102
cally necessary and appropriate and, in the case of
such an exception, apply the same cost-sharing re-
quirements that would have applied in the case of a
drug covered under the formulary.
(b) COVERAGE OF APPROVED DRUGS AND MEDICAL
DEVICES.—
(1) IN GENERAL.—A group health plan (and
health insurance coverage offered in connection with
such a plan) that provides any coverage of prescrip-
tion drugs or medical devices shall not deny coverage
of such a drug or device on the basis that the use
is investigational, if the use—
(A) in the case of a prescription drug—
(i) is included in the labeling author-
ized by the application in effect for the
drug pursuant to subsection (b) or (j) of
section 505 of the Federal Food, Drug,
and Cosmetic Act, without regard to any
postmarketing 
requirements 
that 
may
apply under such Act; or
(ii) is included in the labeling author-
ized by the application in effect for the
drug under section 351 of the Public
Health Service Act, without regard to any
103
postmarketing 
requirements 
that 
may
apply pursuant to such section; or
(B) in the case of a medical device, is in-
cluded in the labeling authorized by a regula-
tion under subsection (d) or (3) of section 513
of the Federal Food, Drug, and Cosmetic Act,
an order under subsection (f) of such section, or
an application approved under section 515 of
such Act, without regard to any postmarketing
requirements that may apply under such Act.
(2) CONSTRUCTION.—Nothing in this sub-
section shall be construed as requiring a group
health plan (or health insurance coverage offered in
connection with such a plan) to provide any coverage
of prescription drugs or medical devices.
SEC. 119. COVERAGE FOR INDIVIDUALS PARTICIPATING IN
APPROVED CLINICAL TRIALS.
(a) COVERAGE.—
(1) IN GENERAL.—If a group health plan, or
health insurance issuer that is providing health in-
surance coverage, provides coverage to a qualified in-
dividual (as defined in subsection (b)), the plan or
issuer—
104
(A) may not deny the individual participa-
tion in the clinical trial referred to in subsection
(b)(2);
(B) subject to subsection (c), may not deny
(or limit or impose additional conditions on) the
coverage of routine patient costs for items and
services furnished in connection with participa-
tion in the trial; and
(C) may not discriminate against the indi-
vidual on the basis of the enrollee’s participa-
tion in such trial.
(2) EXCLUSION OF CERTAIN COSTS.—For pur-
poses of paragraph (1)(B), routine patient costs do
not include the cost of the tests or measurements
conducted primarily for the purpose of the clinical
trial involved.
(3) USE OF IN-NETWORK PROVIDERS.—If one
or more participating providers is participating in a
clinical trial, nothing in paragraph (1) shall be con-
strued as preventing a plan or issuer from requiring
that a qualified individual participate in the trial
through such a participating provider if the provider
will accept the individual as a participant in the
trial.
105
(b) QUALIFIED INDIVIDUAL DEFINED.—For pur-
poses of subsection (a), the term ‘‘qualified individual’’
means an individual who is a participant or beneficiary
in a group health plan, or who is an enrollee under health
insurance coverage, and who meets the following condi-
tions:
(1)(A) The individual has a life-threatening or
serious illness for which no standard treatment is ef-
fective.
(B) The individual is eligible to participate in
an approved clinical trial according to the trial pro-
tocol with respect to treatment of such illness.
(C) The individual’s participation in the trial
offers meaningful potential for significant clinical
benefit for the individual.
(2) Either—
(A) the referring physician is a partici-
pating health care professional and has con-
cluded that the individual’s participation in
such trial would be appropriate based upon the
individual meeting the conditions described in
paragraph (1); or
(B) the participant, beneficiary, or enrollee
provides medical and scientific information es-
tablishing that the individual’s participation in
106
such trial would be appropriate based upon the
individual meeting the conditions described in
paragraph (1).
(c) PAYMENT.—
(1) IN GENERAL.—Under this section a group
health plan and a health insurance issuer shall pro-
vide for payment for routine patient costs described
in subsection (a)(2) but is not required to pay for
costs of items and services that are reasonably ex-
pected (as determined by the appropriate Secretary)
to be paid for by the sponsors of an approved clin-
ical trial.
(2) PAYMENT RATE.—In the case of covered
items and services provided by—
(A) a participating provider, the payment
rate shall be at the agreed upon rate; or
(B) a nonparticipating provider, the pay-
ment rate shall be at the rate the plan or issuer
would normally pay for comparable services
under subparagraph (A).
(d) APPROVED CLINICAL TRIAL DEFINED.—
(1) IN
GENERAL.—In this section, the term
‘‘approved clinical trial’’ means a clinical research
study or clinical investigation—
107
(A) approved and funded (which may in-
clude funding through in-kind contributions) by
one or more of the following:
(i) the National Institutes of Health;
(ii) a cooperative group or center of
the National Institutes of Health, includ-
ing a qualified nongovernmental research
entity to which the National Cancer Insti-
tute has awarded a center support grant;
(iii) either of the following if the con-
ditions described in paragraph (2) are
met—
(I) the Department of Veterans
Affairs;
(II) the Department of Defense;
or
(B) approved by the Food and Drug Ad-
ministration.
(2) CONDITIONS
FOR
DEPARTMENTS.—The
conditions described in this paragraph, for a study
or investigation conducted by a Department, are
that the study or investigation has been reviewed
and approved through a system of peer review that
the appropriate Secretary determines—
108
(A) to be comparable to the system of peer
review of studies and investigations used by the
National Institutes of Health; and
(B) assures unbiased review of the highest
ethical standards by qualified individuals who
have no interest in the outcome of the review.
(e) CONSTRUCTION.—Nothing in this section shall be
construed to limit a plan’s or issuer’s coverage with re-
spect to clinical trials.
SEC. 120. REQUIRED COVERAGE FOR MINIMUM HOSPITAL
STAY FOR MASTECTOMIES AND LYMPH NODE
DISSECTIONS 
FOR 
THE 
TREATMENT 
OF
BREAST CANCER AND COVERAGE FOR SEC-
ONDARY CONSULTATIONS.
(a) INPATIENT CARE.—
(1) IN GENERAL.—A group health plan, and a
health insurance issuer providing health insurance
coverage, that provides medical and surgical benefits
shall ensure that inpatient coverage with respect to
the treatment of breast cancer is provided for a pe-
riod of time as is determined by the attending physi-
cian, in consultation with the patient, to be medi-
cally necessary and appropriate following—
(A) a mastectomy;
(B) a lumpectomy; or
109
(C) a lymph node dissection for the treat-
ment of breast cancer.
(2) EXCEPTION.—Nothing in this section shall
be construed as requiring the provision of inpatient
coverage if the attending physician and patient de-
termine that a shorter period of hospital stay is
medically appropriate.
(b) PROHIBITION ON CERTAIN MODIFICATIONS.—In
implementing the requirements of this section, a group
health plan, and a health insurance issuer providing health
insurance coverage, may not modify the terms and condi-
tions of coverage based on the determination by a partici-
pant, beneficiary, or enrollee to request less than the min-
imum coverage required under subsection (a).
(c) SECONDARY CONSULTATIONS.—
(1) IN GENERAL.—A group health plan, and a
health insurance issuer providing health insurance
coverage, that provides coverage with respect to
medical and surgical services provided in relation to
the diagnosis and treatment of cancer shall ensure
that full coverage is provided for secondary consulta-
tions by specialists in the appropriate medical fields
(including pathology, radiology, and oncology) to
confirm or refute such diagnosis. Such plan or issuer
shall ensure that full coverage is provided for such
110
secondary consultation whether such consultation is
based on a positive or negative initial diagnosis. In
any case in which the attending physician certifies in
writing that services necessary for such a secondary
consultation are not sufficiently available from spe-
cialists operating under the plan or coverage with re-
spect to whose services coverage is otherwise pro-
vided under such plan or by such issuer, such plan
or issuer shall ensure that coverage is provided with
respect to the services necessary for the secondary
consultation with any other specialist selected by the
attending physician for such purpose at no addi-
tional cost to the individual beyond that which the
individual would have paid if the specialist was par-
ticipating in the network of the plan or issuer.
(2) EXCEPTION.—Nothing in paragraph (1)
shall be construed as requiring the provision of sec-
ondary consultations where the patient determines
not to seek such a consultation.
(d) PROHIBITION ON PENALTIES OR INCENTIVES.—
A group health plan, and a health insurance issuer pro-
viding health insurance coverage, may not—
(1) penalize or otherwise reduce or limit the re-
imbursement of a provider or specialist because the
provider or specialist provided care to a participant,
111
beneficiary, or enrollee in accordance with this sec-
tion;
(2) provide financial or other incentives to a
physician or specialist to induce the physician or
specialist to keep the length of inpatient stays of pa-
tients following a mastectomy, lumpectomy, or a
lymph node dissection for the treatment of breast
cancer below certain limits or to limit referrals for
secondary consultations; or
(3) provide financial or other incentives to a
physician or specialist to induce the physician or
specialist to refrain from referring a participant,
beneficiary, or enrollee for a secondary consultation
that would otherwise be covered by the plan or cov-
erage involved under subsection (c).
Subtitle C—Access to Information
SEC. 121. PATIENT ACCESS TO INFORMATION.
(a) REQUIREMENT.—
(1) DISCLOSURE.—
(A) IN GENERAL.—A group health plan,
and a health insurance issuer that provides cov-
erage in connection with health insurance cov-
erage, shall provide for the disclosure to partici-
pants, beneficiaries, and enrollees—
112
(i) of the information described in
subsection (b) at the time of the initial en-
rollment of the participant, beneficiary, or
enrollee under the plan or coverage;
(ii) of such information on an annual
basis—
(I) in conjunction with the elec-
tion period of the plan or coverage if
the plan or coverage has such an elec-
tion period; or
(II) in the case of a plan or cov-
erage that does not have an election
period, in conjunction with the begin-
ning of the plan or coverage year; and
(iii) of information relating to any
material reduction to the benefits or infor-
mation described in such subsection or
subsection (c), in the form of a notice pro-
vided not later than 30 days before the
date on which the reduction takes effect.
(B) PARTICIPANTS, BENEFICIARIES, AND
ENROLLEES.—The disclosure required under
subparagraph (A) shall be provided—
113
(i) jointly to each participant, bene-
ficiary, and enrollee who reside at the same
address; or
(ii) in the case of a beneficiary or en-
rollee who does not reside at the same ad-
dress as the participant or another en-
rollee, separately to the participant or
other enrollees and such beneficiary or en-
rollee.
(2) PROVISION OF INFORMATION.—Information
shall be provided to participants, beneficiaries, and
enrollees under this section at the last known ad-
dress maintained by the plan or issuer with respect
to such participants, beneficiaries, or enrollees, to
the extent that such information is provided to par-
ticipants, beneficiaries, or enrollees via the United
States Postal Service or other private delivery serv-
ice.
(b) REQUIRED INFORMATION.—The informational
materials to be distributed under this section shall include
for each option available under the group health plan or
health insurance coverage the following:
(1) BENEFITS.—A description of the covered
benefits, including—
(A) any in- and out-of-network benefits;
114
(B) specific preventive services covered
under the plan or coverage if such services are
covered;
(C) any specific exclusions or express limi-
tations 
of 
benefits 
described 
in 
section
104(d)(3)(C);
(D) any other benefit limitations, including
any annual or lifetime benefit limits and any
monetary limits or limits on the number of vis-
its, days, or services, and any specific coverage
exclusions; and
(E) any definition of medical necessity
used in making coverage determinations by the
plan, issuer, or claims administrator.
(2) COST SHARING.—A description of any cost-
sharing requirements, including—
(A) any premiums, deductibles, coinsur-
ance, copayment amounts, and liability for bal-
ance billing, for which the participant, bene-
ficiary, or enrollee will be responsible under
each option available under the plan;
(B) any maximum out-of-pocket expense
for which the participant, beneficiary, or en-
rollee may be liable;
115
(C) any cost-sharing requirements for out-
of-network benefits or services received from
nonparticipating providers; and
(D) any additional cost-sharing or charges
for benefits and services that are furnished
without meeting applicable plan or coverage re-
quirements, such as prior authorization or
precertification.
(3) DISENROLLMENT.—Information relating to
the disenrollment of a participant, beneficiary, or en-
rollee.
(4) SERVICE AREA.—A description of the plan
or issuer’s service area, including the provision of
any out-of-area coverage.
(5) PARTICIPATING PROVIDERS.—A directory of
participating providers (to the extent a plan or
issuer provides coverage through a network of pro-
viders) that includes, at a minimum, the name, ad-
dress, and telephone number of each participating
provider, and information about how to inquire
whether a participating provider is currently accept-
ing new patients.
(6) CHOICE OF PRIMARY CARE PROVIDER.—A
description of any requirements and procedures to
be used by participants, beneficiaries, and enrollees
116
in selecting, accessing, or changing their primary
care provider, including providers both within and
outside of the network (if the plan or issuer permits
out-of-network services), and the right to select a pe-
diatrician as a primary care provider under section
116 for a participant, beneficiary, or enrollee who is
a child if such section applies.
(7) PREAUTHORIZATION
REQUIREMENTS.—A
description of the requirements and procedures to be
used to obtain preauthorization for health services,
if such preauthorization is required.
(8) EXPERIMENTAL
AND
INVESTIGATIONAL
TREATMENTS.—A description of the process for de-
termining whether a particular item, service, or
treatment is considered experimental or investiga-
tional, and the circumstances under which such
treatments are covered by the plan or issuer.
(9) SPECIALTY CARE.—A description of the re-
quirements and procedures to be used by partici-
pants, beneficiaries, and enrollees in accessing spe-
cialty care and obtaining referrals to participating
and nonparticipating specialists, including any limi-
tations on choice of health care professionals re-
ferred to in section 112(b)(2) and the right to timely
117
access to specialists care under section 114 if such
section applies.
(10) CLINICAL TRIALS.—A description of the
circumstances and conditions under which participa-
tion in clinical trials is covered under the terms and
conditions of the plan or coverage, and the right to
obtain coverage for approved clinical trials under
section 119 if such section applies.
(11) PRESCRIPTION DRUGS.—To the extent the
plan or issuer provides coverage for prescription
drugs, a statement of whether such coverage is lim-
ited to drugs included in a formulary, a description
of any provisions and cost-sharing required for ob-
taining on- and off-formulary medications, and a de-
scription of the rights of participants, beneficiaries,
and enrollees in obtaining access to access to pre-
scription drugs under section 118 if such section ap-
plies.
(12) EMERGENCY
SERVICES.—A summary of
the rules and procedures for accessing emergency
services, including the right of a participant, bene-
ficiary, or enrollee to obtain emergency services
under the prudent layperson standard under section
113, if such section applies, and any educational in-
118
formation that the plan or issuer may provide re-
garding the appropriate use of emergency services.
(13) CLAIMS AND APPEALS.—A description of
the plan or issuer’s rules and procedures pertaining
to claims and appeals, a description of the rights
(including deadlines for exercising rights) of partici-
pants, beneficiaries, and enrollees under subtitle A
in obtaining covered benefits, filing a claim for bene-
fits, and appealing coverage decisions internally and
externally (including telephone numbers and mailing
addresses of the appropriate authority), and a de-
scription of any additional legal rights and remedies
available under section 502 of the Employee Retire-
ment Income Security Act of 1974 and applicable
State law.
(14) ADVANCE DIRECTIVES AND ORGAN DONA-
TION.—A description of procedures for advance di-
rectives and organ donation decisions if the plan or
issuer maintains such procedures.
(15) INFORMATION ON PLANS AND ISSUERS.—
The name, mailing address, and telephone number
or numbers of the plan administrator and the issuer
to be used by participants, beneficiaries, and enroll-
ees seeking information about plan or coverage bene-
fits and services, payment of a claim, or authoriza-
119
tion for services and treatment. Notice of whether
the benefits under the plan or coverage are provided
under a contract or policy of insurance issued by an
issuer, or whether benefits are provided directly by
the plan sponsor who bears the insurance risk.
(16) TRANSLATION SERVICES.—A summary de-
scription of any translation or interpretation services
(including the availability of printed information in
languages other than English, audio tapes, or infor-
mation in Braille) that are available for non-English
speakers and participants, beneficiaries, and enroll-
ees with communication disabilities and a description
of how to access these items or services.
(17) ACCREDITATION INFORMATION.—Any in-
formation that is made public by accrediting organi-
zations in the process of accreditation if the plan or
issuer is accredited, or any additional quality indica-
tors (such as the results of enrollee satisfaction sur-
veys) that the plan or issuer makes public or makes
available to participants, beneficiaries, and enrollees.
(18) NOTICE OF REQUIREMENTS.—A descrip-
tion of any rights of participants, beneficiaries, and
enrollees that are established by the Bipartisan Pa-
tient Protection Act (excluding those described in
paragraphs (1) through (17)) if such sections apply.
120
The description required under this paragraph may
be combined with the notices of the type described
in sections 711(d), 713(b), or 606(a)(1) of the Em-
ployee Retirement Income Security Act of 1974 and
with any other notice provision that the appropriate
Secretary determines may be combined, so long as
such combination does not result in any reduction in
the information that would otherwise be provided to
the recipient.
(19) AVAILABILITY OF ADDITIONAL INFORMA-
TION.—A statement that the information described
in subsection (c), and instructions on obtaining such
information (including telephone numbers and, if
available, Internet websites), shall be made available
upon request.
(20) DESIGNATED
DECISIONMAKERS.—A de-
scription of the participants and beneficiaries with
respect to whom each designated decisionmaker
under the plan has assumed liability under section
502(o) of the Employee Retirement Income Security
Act of 1974 and the name and address of each such
decisionmaker.
(c) ADDITIONAL INFORMATION.—The informational
materials to be provided upon the request of a participant,
beneficiary, or enrollee shall include for each option avail-
121
able under a group health plan or health insurance cov-
erage the following:
(1) STATUS OF PROVIDERS.—The State licen-
sure status of the plan or issuer’s participating
health care professionals and participating health
care facilities, and, if available, the education, train-
ing, specialty qualifications or certifications of such
professionals.
(2) COMPENSATION
METHODS.—A summary
description by category of the applicable methods
(such as capitation, fee-for-service, salary, bundled
payments, per diem, or a combination thereof) used
for compensating prospective or treating health care
professionals (including primary care providers and
specialists) and facilities in connection with the pro-
vision of health care under the plan or coverage.
(3) PRESCRIPTION DRUGS.—Information about
whether a specific prescription medication is in-
cluded in the formulary of the plan or issuer, if the
plan or issuer uses a defined formulary.
(4) UTILIZATION REVIEW ACTIVITIES.—A de-
scription of procedures used and requirements (in-
cluding circumstances, timeframes, and appeals
rights) under any utilization review program under
122
sections 101 and 102, including any drug formulary
program under section 118.
(5) EXTERNAL
APPEALS
INFORMATION.—Ag-
gregate information on the number and outcomes of
external medical reviews, relative to the sample size
(such as the number of covered lives) under the plan
or under the coverage of the issuer.
(d) MANNER OF DISCLOSURE.—The information de-
scribed in this section shall be disclosed in an accessible
medium and format that is calculated to be understood
by a participant or enrollee.
(e) RULES OF CONSTRUCTION.—Nothing in this sec-
tion shall be construed to prohibit a group health plan,
or a health insurance issuer in connection with health in-
surance coverage, from—
(1) distributing any other additional informa-
tion determined by the plan or issuer to be impor-
tant or necessary in assisting participants, bene-
ficiaries, and enrollees in the selection of a health
plan or health insurance coverage; and
(2) complying with the provisions of this section
by providing information in brochures, through the
Internet or other electronic media, or through other
similar means, so long as—
123
(A) the disclosure of such information in
such form is in accordance with requirements
as the appropriate Secretary may impose, and
(B) in connection with any such disclosure
of information through the Internet or other
electronic media—
(i) the recipient has affirmatively con-
sented to the disclosure of such informa-
tion in such form,
(ii) the recipient is capable of access-
ing the information so disclosed on the re-
cipient’s individual workstation or at the
recipient’s home,
(iii) the recipient retains an ongoing
right to receive paper disclosure of such in-
formation and receives, in advance of any
attempt at disclosure of such information
to him or her through the Internet or
other electronic media, notice in printed
form of such ongoing right and of the
proper software required to view informa-
tion so disclosed, and
(iv) the plan administrator appro-
priately ensures that the intended recipient
is receiving the information so disclosed
124
and provides the information in printed
form if the information is not received.
Subtitle D—Protecting the Doctor-
Patient Relationship
SEC. 131. PROHIBITION OF INTERFERENCE WITH CERTAIN
MEDICAL COMMUNICATIONS.
(a) GENERAL RULE.—The provisions of any contract
or agreement, or the operation of any contract or agree-
ment, between a group health plan or health insurance
issuer in relation to health insurance coverage (including
any partnership, association, or other organization that
enters into or administers such a contract or agreement)
and a health care provider (or group of health care pro-
viders) shall not prohibit or otherwise restrict a health
care professional from advising such a participant, bene-
ficiary, or enrollee who is a patient of the professional
about the health status of the individual or medical care
or treatment for the individual’s condition or disease, re-
gardless of whether benefits for such care or treatment
are provided under the plan or coverage, if the professional
is acting within the lawful scope of practice.
(b) NULLIFICATION.—Any contract provision or
agreement that restricts or prohibits medical communica-
tions in violation of subsection (a) shall be null and void.
125
SEC. 132. PROHIBITION OF DISCRIMINATION AGAINST PRO-
VIDERS BASED ON LICENSURE.
(a) IN GENERAL.—A group health plan, and a health
insurance issuer with respect to health insurance coverage,
shall not discriminate with respect to participation or in-
demnification as to any provider who is acting within the
scope of the provider’s license or certification under appli-
cable State law, solely on the basis of such license or cer-
tification.
(b) CONSTRUCTION.—Subsection (a) shall not be
construed—
(1) as requiring the coverage under a group
health plan or health insurance coverage of a par-
ticular benefit or service or to prohibit a plan or
issuer from including providers only to the extent
necessary to meet the needs of the plan’s or issuer’s
participants, beneficiaries, or enrollees or from es-
tablishing any measure designed to maintain quality
and control costs consistent with the responsibilities
of the plan or issuer;
(2) to override any State licensure or scope-of-
practice law; or
(3) as requiring a plan or issuer that offers net-
work coverage to include for participation every will-
ing provider who meets the terms and conditions of
the plan or issuer.
126
SEC. 133. PROHIBITION AGAINST IMPROPER INCENTIVE
ARRANGEMENTS.
(a) IN GENERAL.—A group health plan and a health
insurance issuer offering health insurance coverage may
not operate any physician incentive plan (as defined in
subparagraph (B) of section 1852(j)(4) of the Social Secu-
rity Act) unless the requirements described in clauses (i),
(ii)(I), and (iii) of subparagraph (A) of such section are
met with respect to such a plan.
(b) APPLICATION.—For purposes of carrying out
paragraph (1), any reference in section 1852(j)(4) of the
Social Security Act to the Secretary, a Medicare+Choice
organization, or an individual enrolled with the organiza-
tion shall be treated as a reference to the applicable au-
thority, a group health plan or health insurance issuer,
respectively, and a participant, beneficiary, or enrollee
with the plan or organization, respectively.
(c) CONSTRUCTION.—Nothing in this section shall be
construed as prohibiting all capitation and similar ar-
rangements or all provider discount arrangements.
SEC. 134. PAYMENT OF CLAIMS.
A group health plan, and a health insurance issuer
offering health insurance coverage, shall provide for
prompt payment of claims submitted for health care serv-
ices or supplies furnished to a participant, beneficiary, or
enrollee with respect to benefits covered by the plan or
127
issuer, in a manner that is no less protective than the pro-
visions of section 1842(c)(2) of the Social Security Act
(42 U.S.C. 1395u(c)(2)).
SEC. 135. PROTECTION FOR PATIENT ADVOCACY.
(a) PROTECTION FOR USE OF UTILIZATION REVIEW
AND GRIEVANCE PROCESS.—A group health plan, and a
health insurance issuer with respect to the provision of
health insurance coverage, may not retaliate against a par-
ticipant, beneficiary, enrollee, or health care provider
based on the participant’s, beneficiary’s, enrollee’s or pro-
vider’s use of, or participation in, a utilization review proc-
ess or a grievance process of the plan or issuer (including
an internal or external review or appeal process) under
this title.
(b) PROTECTION
FOR
QUALITY
ADVOCACY
BY
HEALTH CARE PROFESSIONALS.—
(1) IN GENERAL.—A group health plan and a
health insurance issuer may not retaliate or dis-
criminate against a protected health care profes-
sional because the professional in good faith—
(A) discloses information relating to the
care, services, or conditions affecting one or
more participants, beneficiaries, or enrollees of
the plan or issuer to an appropriate public reg-
ulatory agency, an appropriate private accredi-
128
tation body, or appropriate management per-
sonnel of the plan or issuer; or
(B) initiates, cooperates, or otherwise par-
ticipates in an investigation or proceeding by
such an agency with respect to such care, serv-
ices, or conditions.
If an institutional health care provider is a partici-
pating provider with such a plan or issuer or other-
wise receives payments for benefits provided by such
a plan or issuer, the provisions of the previous sen-
tence shall apply to the provider in relation to care,
services, or conditions affecting one or more patients
within an institutional health care provider in the
same manner as they apply to the plan or issuer in
relation to care, services, or conditions provided to
one or more participants, beneficiaries, or enrollees;
and for purposes of applying this sentence, any ref-
erence to a plan or issuer is deemed a reference to
the institutional health care provider.
(2) GOOD
FAITH
ACTION.—For purposes of
paragraph (1), a protected health care professional
is considered to be acting in good faith with respect
to disclosure of information or participation if, with
respect to the information disclosed as part of the
action—
129
(A) the disclosure is made on the basis of
personal knowledge and is consistent with that
degree of learning and skill ordinarily possessed
by health care professionals with the same li-
censure or certification and the same experi-
ence;
(B) the professional reasonably believes the
information to be true;
(C) the information evidences either a vio-
lation of a law, rule, or regulation, of an appli-
cable accreditation standard, or of a generally
recognized professional or clinical standard or
that a patient is in imminent hazard of loss of
life or serious injury; and
(D) subject to subparagraphs (B) and (C)
of paragraph (3), the professional has followed
reasonable internal procedures of the plan,
issuer, or institutional health care provider es-
tablished for the purpose of addressing quality
concerns before making the disclosure.
(3) EXCEPTION AND SPECIAL RULE.—
(A) GENERAL EXCEPTION.—Paragraph (1)
does not protect disclosures that would violate
Federal or State law or diminish or impair the
rights of any person to the continued protection
130
of confidentiality of communications provided
by such law.
(B) NOTICE OF INTERNAL PROCEDURES.—
Subparagraph (D) of paragraph (2) shall not
apply unless the internal procedures involved
are reasonably expected to be known to the
health care professional involved. For purposes
of this subparagraph, a health care professional
is reasonably expected to know of internal pro-
cedures if those procedures have been made
available to the professional through distribu-
tion or posting.
(C) INTERNAL PROCEDURE EXCEPTION.—
Subparagraph (D) of paragraph (2) also shall
not apply if—
(i) the disclosure relates to an immi-
nent hazard of loss of life or serious injury
to a patient;
(ii) the disclosure is made to an ap-
propriate private accreditation body pursu-
ant to disclosure procedures established by
the body; or
(iii) the disclosure is in response to an
inquiry made in an investigation or pro-
ceeding of an appropriate public regulatory
131
agency and the information disclosed is
limited to the scope of the investigation or
proceeding.
(4) ADDITIONAL
CONSIDERATIONS.—It shall
not be a violation of paragraph (1) to take an ad-
verse action against a protected health care profes-
sional if the plan, issuer, or provider taking the ad-
verse action involved demonstrates that it would
have taken the same adverse action even in the ab-
sence of the activities protected under such para-
graph.
(5) NOTICE.—A group health plan, health in-
surance issuer, and institutional health care provider
shall post a notice, to be provided or approved by
the Secretary of Labor, setting forth excerpts from,
or summaries of, the pertinent provisions of this
subsection and information pertaining to enforce-
ment of such provisions.
(6) CONSTRUCTIONS.—
(A) DETERMINATIONS
OF
COVERAGE.—
Nothing in this subsection shall be construed to
prohibit a plan or issuer from making a deter-
mination not to pay for a particular medical
treatment or service or the services of a type of
health care professional.
132
(B) ENFORCEMENT OF PEER REVIEW PRO-
TOCOLS AND INTERNAL PROCEDURES.—Noth-
ing in this subsection shall be construed to pro-
hibit a plan, issuer, or provider from estab-
lishing and enforcing reasonable peer review or
utilization review protocols or determining
whether a protected health care professional has
complied with those protocols or from estab-
lishing and enforcing internal procedures for
the purpose of addressing quality concerns.
(C) RELATION TO OTHER RIGHTS.—Noth-
ing in this subsection shall be construed to
abridge rights of participants, beneficiaries, en-
rollees, and protected health care professionals
under other applicable Federal or State laws.
(7) PROTECTED HEALTH CARE PROFESSIONAL
DEFINED.—For purposes of this subsection, the
term ‘‘protected health care professional’’ means an
individual who is a licensed or certified health care
professional and who—
(A) with respect to a group health plan or
health insurance issuer, is an employee of the
plan or issuer or has a contract with the plan
or issuer for provision of services for which ben-
efits are available under the plan or issuer; or
133
(B) with respect to an institutional health
care provider, is an employee of the provider or
has a contract or other arrangement with the
provider respecting the provision of health care
services.
Subtitle E—Definitions
SEC. 151. DEFINITIONS.
(a) INCORPORATION OF GENERAL DEFINITIONS.—
Except as otherwise provided, the provisions of section
2791 of the Public Health Service Act shall apply for pur-
poses of this title in the same manner as they apply for
purposes of title XXVII of such Act.
(b) SECRETARY.—Except as otherwise provided, the
term ‘‘Secretary’’ means the Secretary of Health and
Human Services, in consultation with the Secretary of
Labor and the term ‘‘appropriate Secretary’’ means the
Secretary of Health and Human Services in relation to
carrying out this title under sections 2706 and 2751 of
the Public Health Service Act and the Secretary of Labor
in relation to carrying out this title under section 714 of
the Employee Retirement Income Security Act of 1974.
(c) ADDITIONAL DEFINITIONS.—For purposes of this
title:
(1) APPLICABLE AUTHORITY.—The term ‘‘ap-
plicable authority’’ means—
134
(A) in the case of a group health plan, the
Secretary of Health and Human Services and
the Secretary of Labor; and
(B) in the case of a health insurance issuer
with respect to a specific provision of this title,
the applicable State authority (as defined in
section 2791(d) of the Public Health Service
Act), or the Secretary of Health and Human
Services, if such Secretary is enforcing such
provision 
under 
section 
2722(a)(2) 
or
2761(a)(2) of the Public Health Service Act.
(2) ENROLLEE.—The term ‘‘enrollee’’ means,
with respect to health insurance coverage offered by
a health insurance issuer, an individual enrolled with
the issuer to receive such coverage.
(3) GROUP HEALTH PLAN.—The term ‘‘group
health plan’’ has the meaning given such term in
section 733(a) of the Employee Retirement Income
Security Act of 1974, except that such term includes
a employee welfare benefit plan treated as a group
health plan under section 732(d) of such Act or de-
fined as such a plan under section 607(1) of such
Act.
(4) HEALTH CARE PROFESSIONAL.—The term
‘‘health care professional’’ means an individual who
135
is licensed, accredited, or certified under State law
to provide specified health care services and who is
operating within the scope of such licensure, accredi-
tation, or certification.
(5) HEALTH
CARE
PROVIDER.—The term
‘‘health care provider’’ includes a physician or other
health care professional, as well as an institutional
or other facility or agency that provides health care
services and that is licensed, accredited, or certified
to provide health care items and services under ap-
plicable State law.
(6) NETWORK.—The term ‘‘network’’ means,
with respect to a group health plan or health insur-
ance issuer offering health insurance coverage, the
participating health care professionals and providers
through whom the plan or issuer provides health
care items and services to participants, beneficiaries,
or enrollees.
(7) 
NONPARTICIPATING.—The 
term 
‘‘non-
participating’’ means, with respect to a health care
provider that provides health care items and services
to a participant, beneficiary, or enrollee under group
health plan or health insurance coverage, a health
care provider that is not a participating health care
provider with respect to such items and services.
136
(8) PARTICIPATING.—The term ‘‘participating’’
means, with respect to a health care provider that
provides health care items and services to a partici-
pant, beneficiary, or enrollee under group health
plan or health insurance coverage offered by a
health insurance issuer, a health care provider that
furnishes such items and services under a contract
or other arrangement with the plan or issuer.
(9) PRIOR AUTHORIZATION.—The term ‘‘prior
authorization’’ means the process of obtaining prior
approval from a health insurance issuer or group
health plan for the provision or coverage of medical
services.
(10) TERMS
AND
CONDITIONS.—The term
‘‘terms and conditions’’ includes, with respect to a
group health plan or health insurance coverage, re-
quirements imposed under this title with respect to
the plan or coverage.
SEC. 152. PREEMPTION; STATE FLEXIBILITY; CONSTRUC-
TION.
(a) CONTINUED APPLICABILITY
OF STATE LAW
WITH RESPECT TO HEALTH INSURANCE ISSUERS.—
(1) IN GENERAL.—Subject to paragraph (2),
this title shall not be construed to supersede any
provision of State law which establishes, implements,
137
or continues in effect any standard or requirement
solely relating to health insurance issuers (in connec-
tion with group health insurance coverage or other-
wise) except to the extent that such standard or re-
quirement prevents the application of a requirement
of this title.
(2) CONTINUED
PREEMPTION
WITH
RESPECT
TO GROUP HEALTH PLANS.—Nothing in this title
shall be construed to affect or modify the provisions
of section 514 of the Employee Retirement Income
Security Act of 1974 with respect to group health
plans.
(3) CONSTRUCTION.—In applying this section,
a State law that provides for equal access to, and
availability of, all categories of licensed health care
providers and services shall not be treated as pre-
venting the application of any requirement of this
title.
(b) APPLICATION
OF SUBSTANTIALLY COMPLIANT
STATE LAWS.—
(1) IN GENERAL.—In the case of a State law
that imposes, with respect to health insurance cov-
erage offered by a health insurance issuer and with
respect to a group health plan that is a non-Federal
governmental plan, a requirement that substantially
138
complies (within the meaning of subsection (c)) with
a patient protection requirement (as defined in para-
graph (3)) and does not prevent the application of
other requirements under this Act (except in the
case of other substantially compliant requirements),
in applying the requirements of this title under sec-
tion 2707 and 2753 (as applicable) of the Public
Health Service Act (as added by title II), subject to
subsection (a)(2)—
(A) the State law shall not be treated as
being superseded under subsection (a); and
(B) the State law shall apply instead of the
patient protection requirement otherwise appli-
cable with respect to health insurance coverage
and non-Federal governmental plans.
(2) LIMITATION.—In the case of a group health
plan covered under title I of the Employee Retire-
ment Income Security Act of 1974, paragraph (1)
shall be construed to apply only with respect to the
health insurance coverage (if any) offered in connec-
tion with the plan.
(3) DEFINITIONS.—In this section:
(A) 
PATIENT
PROTECTION
REQUIRE-
MENT.—The term ‘‘patient protection require-
ment’’ means a requirement under this title,
139
and includes (as a single requirement) a group
or related set of requirements under a section
or similar unit under this title.
(B) 
SUBSTANTIALLY
COMPLIANT.—The
terms ‘‘substantially compliant’’, substantially
complies’’, or ‘‘substantial compliance’’ with re-
spect to a State law, mean that the State law
has the same or similar features as the patient
protection requirements and has a similar ef-
fect.
(c) DETERMINATIONS
OF SUBSTANTIAL COMPLI-
ANCE.—
(1) CERTIFICATION BY STATES.—A State may
submit to the Secretary a certification that a State
law provides for patient protections that are at least
substantially compliant with one or more patient
protection requirements. Such certification shall be
accompanied by such information as may be re-
quired to permit the Secretary to make the deter-
mination described in paragraph (2)(A).
(2) REVIEW.—
(A) IN
GENERAL.—The Secretary shall
promptly review a certification submitted under
paragraph (1) with respect to a State law to de-
termine if the State law substantially complies
140
with the patient protection requirement (or re-
quirements) to which the law relates.
(B) APPROVAL DEADLINES.—
(i) INITIAL REVIEW.—Such a certifi-
cation is considered approved unless the
Secretary notifies the State in writing,
within 90 days after the date of receipt of
the certification, that the certification is
disapproved (and the reasons for dis-
approval) or that specified additional infor-
mation is needed to make the determina-
tion described in subparagraph (A).
(ii) 
ADDITIONAL
INFORMATION.—
With respect to a State that has been noti-
fied by the Secretary under clause (i) that
specified additional information is needed
to make the determination described in
subparagraph (A), the Secretary shall
make the determination within 60 days
after the date on which such specified ad-
ditional information is received by the Sec-
retary.
(3) APPROVAL.—
141
(A) IN GENERAL.—The Secretary shall ap-
prove a certification under paragraph (1)
unless—
(i) the State fails to provide sufficient
information to enable the Secretary to
make a determination under paragraph
(2)(A); or
(ii) the Secretary determines that the
State law involved does not provide for pa-
tient protections that substantially comply
with the patient protection requirement (or
requirements) to which the law relates.
(B) STATE CHALLENGE.—A State that has
a certification disapproved by the Secretary
under subparagraph (A) may challenge such
disapproval in the appropriate United States
district court.
(C) DEFERENCE
TO
STATES.—With re-
spect to a certification submitted under para-
graph (1), the Secretary shall give deference to
the State’s interpretation of the State law in-
volved with respect to the patient protection in-
volved.
(D) PUBLIC
NOTIFICATION.—The Sec-
retary shall—
142
(i) provide a State with a notice of the
determination to approve or disapprove a
certification under this paragraph;
(ii) promptly publish in the Federal
Register a notice that a State has sub-
mitted a certification under paragraph (1);
(iii) promptly publish in the Federal
Register the notice described in clause (i)
with respect to the State; and
(iv) annually publish the status of all
States with respect to certifications.
(4) CONSTRUCTION.—Nothing in this sub-
section shall be construed as preventing the certifi-
cation (and approval of certification) of a State law
under this subsection solely because it provides for
greater protections for patients than those protec-
tions otherwise required to establish substantial
compliance.
(5) PETITIONS.—
(A) PETITION PROCESS.—Effective on the
date on which the provisions of this Act become
effective, as provided for in section 601, a
group health plan, health insurance issuer, par-
ticipant, beneficiary, or enrollee may submit a
petition to the Secretary for an advisory opinion
143
as to whether or not a standard or requirement
under a State law applicable to the plan, issuer,
participant, beneficiary, or enrollee that is not
the subject of a certification under this sub-
section, is superseded under subsection (a)(1)
because such standard or requirement prevents
the application of a requirement of this title.
(B) OPINION.—The Secretary shall issue
an advisory opinion with respect to a petition
submitted under subparagraph (A) within the
60-day period beginning on the date on which
such petition is submitted.
(d) DEFINITIONS.—For purposes of this section:
(1) STATE
LAW.—The term ‘‘State law’’ in-
cludes all laws, decisions, rules, regulations, or other
State action having the effect of law, of any State.
A law of the United States applicable only to the
District of Columbia shall be treated as a State law
rather than a law of the United States.
(2) STATE.—The term ‘‘State’’ includes a
State, the District of Columbia, Puerto Rico, the
Virgin Islands, Guam, American Samoa, the North-
ern Mariana Islands, any political subdivisions of
such, or any agency or instrumentality of such.
144
SEC. 153. EXCLUSIONS.
(a) NO BENEFIT REQUIREMENTS.—Nothing in this
title shall be construed to require a group health plan or
a health insurance issuer offering health insurance cov-
erage to include specific items and services under the
terms of such a plan or coverage, other than those pro-
vided under the terms and conditions of such plan or cov-
erage.
(b) EXCLUSION FROM ACCESS TO CARE MANAGED
CARE PROVISIONS FOR FEE-FOR-SERVICE COVERAGE.—
(1) IN GENERAL.—The provisions of sections
111 through 117 shall not apply to a group health
plan or health insurance coverage if the only cov-
erage offered under the plan or coverage is fee-for-
service coverage (as defined in paragraph (2)).
(2) FEE-FOR-SERVICE
COVERAGE
DEFINED.—
For purposes of this subsection, the term ‘‘fee-for-
service coverage’’ means coverage under a group
health plan or health insurance coverage that—
(A) reimburses hospitals, health profes-
sionals, and other providers on a fee-for-service
basis without placing the provider at financial
risk;
(B) does not vary reimbursement for such
a provider based on an agreement to contract
145
terms and conditions or the utilization of health
care items or services relating to such provider;
(C) allows access to any provider that is
lawfully authorized to provide the covered serv-
ices and that agrees to accept the terms and
conditions of payment established under the
plan or by the issuer; and
(D) for which the plan or issuer does not
require prior authorization before providing for
any health care services.
SEC. 154. TREATMENT OF EXCEPTED BENEFITS.
(a) IN GENERAL.—The requirements of this title and
the provisions of sections 502(a)(1)(C), 502(n), and
514(d) of the Employee Retirement Income Security Act
of 1974 (added by section 402) shall not apply to excepted
benefits (as defined in section 733(c) of such Act), other
than benefits described in section 733(c)(2)(A) of such
Act, in the same manner as the provisions of part 7 of
subtitle B of title I of such Act do not apply to such bene-
fits under subsections (b) and (c) of section 732 of such
Act.
(b) COVERAGE
OF
CERTAIN
LIMITED
SCOPE
PLANS.—Only for purposes of applying the requirements
of this title under sections 2707 and 2753 of the Public
Health Service Act, section 714 of the Employee Retire-
146
ment Income Security Act of 1974, and section 9813 of
the Internal Revenue Code of 1986, the following sections
shall be deemed not to apply:
(1) Section 2791(c)(2)(A) of the Public Health
Service Act.
(2) Section 733(c)(2)(A) of the Employee Re-
tirement Income Security Act of 1974.
(3) Section 9832(c)(2)(A) of the Internal Rev-
enue Code of 1986.
SEC. 155. REGULATIONS.
The Secretaries of Health and Human Services,
Labor, and the Treasury shall issue such regulations as
may be necessary or appropriate to carry out this title.
Such regulations shall be issued consistent with section
104 of Health Insurance Portability and Accountability
Act of 1996. Such Secretaries may promulgate any in-
terim final rules as the Secretaries determine are appro-
priate to carry out this title.
SEC. 156. INCORPORATION INTO PLAN OR COVERAGE DOC-
UMENTS.
The requirements of this title with respect to a group
health plan or health insurance coverage are, subject to
section 154, deemed to be incorporated into, and made
a part of, such plan or the policy, certificate, or contract
providing such coverage and are enforceable under law as
147
if directly included in the documentation of such plan or
such policy, certificate, or contract.
SEC. 157. PRESERVATION OF PROTECTIONS.
(a) IN GENERAL.—The rights under this Act (includ-
ing the right to maintain a civil action and any other
rights under the amendments made by this Act) may not
be waived, deferred, or lost pursuant to any agreement
not authorized under this Act.
(b) EXCEPTION.—Subsection (a) shall not apply to
an agreement providing for arbitration or participation in
any other nonjudicial procedure to resolve a dispute if the
agreement is entered into knowingly and voluntarily by the
parties involved after the dispute has arisen or is pursuant
to the terms of a collective bargaining agreement. Nothing
in this subsection shall be construed to permit the waiver
of the requirements of sections 103 and 104 (relating to
internal and external review).