vidual during the taxable year is not reasonably expected 
to exceed the applicable percentage (as defined in section 
36(b)) of the amount paid by the taxpayer (or on behalf 
of the taxpayer) for coverage of the taxpayer and quali-
fying family members under qualified health insurance for 
eligible coverage months beginning in the taxable year. 
‘‘(c) CERTIFIED INDIVIDUAL.—For purposes of this 
section, the term ‘certified individual’ means any indi-
vidual for whom a health coverage eligibility certificate is 
in effect. 
‘‘(d) HEALTH
COVERAGE
ELIGIBILITY
CERTIFI-
CATE.—For purposes of this section, the term ‘health cov-
erage eligibility certificate’ means any written statement 
that an individual is an eligible low-income individual (as 
defined in section 36(e)) if such statement provides such 
information as the Secretary may require for purposes of 
this section and is issued by the State agency responsible 
for administering the State children’s health insurance 
program under title XXI of the Social Security Act.’’. 
(b) DISCLOSURE
OF RETURN INFORMATION
FOR 
PURPOSES OF CARRYING OUT A PROGRAM FOR ADVANCE 
PAYMENT OF CREDIT FOR HEALTH INSURANCE COSTS OF 
ELIGIBLE LOW-INCOME INDIVIDUALS.— 
(1) IN
GENERAL.—Subsection (l) of section 
6103 of the Internal Revenue Code of 1986 (relating 
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to disclosure of returns and return information for 
purposes other than tax administration) is amended 
by adding at the end the following new paragraph: 
‘‘(21) DISCLOSURE OF RETURN INFORMATION 
FOR PURPOSES OF CARRYING OUT A PROGRAM FOR 
ADVANCE PAYMENT OF CREDIT FOR HEALTH INSUR-
ANCE
COSTS
OF
ELIGIBLE
LOW-INCOME
INDIVID-
UALS.—The Secretary may disclose to providers of 
health insurance for any certified individual (as de-
fined in section 7527A(c)) return information with 
respect to such certified individual only to the extent 
necessary to carry out the program established by 
section 7527A (relating to advance payment of cred-
it for health insurance costs of eligible low-income 
individuals).’’. 
(2) PROCEDURES
AND
RECORDKEEPING
RE-
LATED TO DISCLOSURES.—Paragraph (4) of section 
6103(p) of such Code is amended by striking ‘‘or 
(20)’’ each place it appears and inserting ‘‘(20), or 
(21)’’. 
(3) UNAUTHORIZED
INSPECTION
OR
DISCLO-
SURE OF RETURNS OR RETURN INFORMATION.—Sec-
tion 7213(a)(2) of such Code is amended by striking 
‘‘or (20)’’ and inserting ‘‘(20), or (21)’’. 
(c) INFORMATION REPORTING.— 
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(1) IN GENERAL.—Subpart B of part III of 
subchapter A of chapter 61 of the Internal Revenue 
Code of 1986 (relating to information concerning 
transactions with other persons) is amended by in-
serting after section 6050V the following new sec-
tion: 
‘‘SEC. 6050W. RETURNS RELATING TO CREDIT FOR HEALTH 
INSURANCE COSTS OF ELIGIBLE LOW-IN-
COME INDIVIDUALS. 
‘‘(a) REQUIREMENT OF REPORTING.—Every person 
who is entitled to receive payments for any month of any 
calendar year under section 7527A (relating to advance 
payment of credit for health insurance costs of eligible 
low-income individuals) with respect to any certified indi-
vidual (as defined in section 7527A(c)) shall, at such time 
as the Secretary may prescribe, make the return described 
in subsection (b) with respect to each such individual. 
‘‘(b) FORM AND MANNER OF RETURNS.—A return 
is described in this subsection if such return— 
‘‘(1) is in such form as the Secretary may pre-
scribe; and 
‘‘(2) contains— 
‘‘(A) the name, address, and TIN of each 
individual referred to in subsection (a); 
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‘‘(B) the number of months for which 
amounts were entitled to be received with re-
spect to such individual under section 7527A 
(relating to advance payment of credit for 
health insurance costs of eligible low-income in-
dividuals); 
‘‘(C) the amount entitled to be received for 
each such month; and 
‘‘(D) such other information as the Sec-
retary may prescribe. 
‘‘(c) STATEMENTS TO BE FURNISHED TO INDIVID-
UALS WITH RESPECT TO WHOM INFORMATION IS RE-
QUIRED.—Every person required to make a return under 
subsection (a) shall furnish to each individual whose name 
is required to be set forth in such return a written state-
ment showing— 
‘‘(1) the name and address of the person re-
quired to make such return and the phone number 
of the information contact for such person; and 
‘‘(2) the information required to be shown on 
the return with respect to such individual. 
The written statement required under the preceding sen-
tence shall be furnished on or before January 31 of the 
year following the calendar year for which the return 
under subsection (a) is required to be made.’’. 
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(2) ASSESSABLE PENALTIES.— 
(A) 
Subparagraph 
(B) 
of 
section 
6724(d)(1) of such Code (relating to defini-
tions) is amended by striking ‘‘or’’ at the end 
of clause (xix), by striking ‘‘, and’’ at the end 
of clause (xx) and inserting ‘‘, or’’, and by add-
ing at the end the following new clause: 
‘‘(xxi) section 6050W (relating to re-
turns relating to credit for health insur-
ance costs of eligible low-income individ-
uals), and’’. 
(B) Paragraph (2) of section 6724(d) of 
such Code is amended by striking the period at 
the end of subparagraph (CC) and inserting ‘‘, 
or’’, and by adding after such subparagraph the 
following new subparagraph: 
‘‘(DD) section 6050W (relating to returns 
relating to credit for health insurance costs of 
eligible low-income individuals).’’. 
(d) CLERICAL AMENDMENTS.— 
(1) ADVANCE PAYMENT.—The table of sections 
for chapter 77 of the Internal Revenue Code of 1986 
is amended by inserting after the item relating to 
section 7527 the following new item: 
‘‘Sec. 7527A. Advance payment of credit for health insurance costs of eligible 
low-income individuals.’’. 
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(2) INFORMATION
REPORTING.—The table of 
sections for subpart B of part III of subchapter A 
of chapter 61 of such Code is amended by inserting 
after the item relating to section 6050V the fol-
lowing new item: 
‘‘Sec. 6050W. Returns relating to credit for health insurance costs of eligible 
low-income individuals.’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on January 1, 2010. 
TITLE IV—IMPROVING ACCESS 
TO HEALTH PLANS 
SEC. 401. DEFINITIONS. 
In this title: 
(1) ELIGIBLE INDIVIDUAL.—The term ‘‘eligible 
individual’’ means an individual with respect to 
whom a tax credit is allowed under section 36 of the 
Internal Revenue Code of 1986 (as added by section 
311). 
(2) EMPLOYER.—The term ‘‘employer’’ includes 
a not-for-profit employer. 
(3) PARTICIPATING INSURER.—The term ‘‘par-
ticipating insurer’’ means an entity with a contract 
under section 405(a). 
(4) 
PRIVATE
GROUP
HEALTH
INSURANCE 
PLAN.—The term ‘‘private group health insurance 
plan’’ means a plan offered by a participating in-
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surer that provides health benefits coverage to eligi-
ble individuals and that meets the requirements of 
this title. 
(5) PURCHASING POOL OPERATOR.—The term 
‘‘purchasing pool operator’’ means the entity des-
ignated by the State under section 404. 
(6) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of Health and Human Services. 
(7) SMALL EMPLOYER.—The term ‘‘small em-
ployer’’ means an employer with not less than 2 and 
not more than 100 employees. 
SEC. 402. ESTABLISHMENT OF HEALTH INSURANCE PUR-
CHASING POOLS. 
There is established a program under which the Sec-
retary shall ensure that each eligible individual has the 
opportunity to enroll, through a purchasing pool operator, 
in a private group health insurance plan offered by a par-
ticipating insurer under this title. 
SEC. 403. PURCHASING POOLS. 
(a) ESTABLISHMENT OF PURCHASING POOLS.—Each 
State participating in the program under this title shall 
establish a purchasing pool that is available to each eligi-
ble individual who resides in the State. 
(b) TYPES OF PURCHASING POOLS.— 
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(1) IN
GENERAL.—A purchasing pool estab-
lished under subsection (a) shall be 1 of the fol-
lowing: 
(A) A statewide purchasing pool operated 
by the State. 
(B) A statewide purchasing pool operated 
on behalf of the State by the Director of the 
Office of Personnel Management, or the des-
ignee of such Director. 
(2) OPM OPERATED POOL.—In the case of a 
statewide purchasing pool described in paragraph 
(1)(B), the Director of the Office of Personnel Man-
agement or the Director’s designee, may limit par-
ticipating insurers in such pool to those described in 
section 405(e), except that the Director or such des-
ignee shall ensure that additional private group 
health insurance plans participate in such a pool to 
the extent necessary to meet the requirements of 
section 404(c)(9). 
(c) STATE ELECTION PROCESS.— 
(1) IN GENERAL.—Each State participating in 
the program under this title shall notify the Sec-
retary, not later than January 4, 2009, of the type 
of purchasing pool that applies to residents of the 
State. 
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(2) DEFAULT CHOICE.—If a State participating 
in the program under this title fails to notify the 
Secretary of the type of purchasing pool elected by 
the State by the date described in paragraph (1), 
the State shall be deemed to have elected the type 
of purchasing pool described in subsection (b)(1)(B). 
(3) CHANGE
OF
ELECTION.—The Secretary 
shall establish procedures under which a State par-
ticipating in the program under this title may 
change the election of the type of purchasing pool 
applicable to residents of the State. 
SEC. 404. PURCHASING POOL OPERATORS. 
(a) DESIGNATION.—Each State shall designate a 
purchasing pool operator that shall be responsible for op-
erating the purchasing pool established under section 
403(a). A purchasing pool operator may be (or, to have 
1 or more of its functions performed, may contract with) 
a private entity that has entered into a contract with the 
State if such entity meets requirements established by the 
Secretary for purposes of the program under this title. 
(b) OPERATION SIMILAR TO FEHBP.—Each pur-
chasing pool operator shall operate the purchasing pool 
established under section 403(a) in a manner that is simi-
lar to the manner in which the Director of the Office of 
Personnel Management operates the Federal employees’ 
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health benefits program under chapter 89 of title 5, 
United States Code, including (but not limited to) the per-
formance of the specific functions described in subsection 
(c). 
(c) SPECIFIC FUNCTIONS DESCRIBED.—The specific 
functions described in this subsection include the fol-
lowing: 
(1) Each purchasing pool operator shall offer 
one-stop shopping for eligible individuals to enroll 
for health benefits coverage under private, group 
health insurance plans offered by participating in-
surers. 
(2) Each purchasing pool operator shall limit 
participating insurers to those that meet the condi-
tions for participation described in this title. 
(3) Each purchasing pool operator shall nego-
tiate (or, in the case of a purchasing pool described 
in section 403(b)(1)(B), shall negotiate or otherwise 
determine) bids and terms of coverage with insurers. 
(4) Each purchasing pool operator shall provide 
eligible individuals with comparative information on 
private group health insurance plans offered by par-
ticipating insurers. 
(5) Each purchasing pool operator shall assist 
eligible individuals in enrolling with a private group 
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health insurance plan offered by a participating in-
surer. 
(6) Each purchasing pool operator shall collect 
private group health insurance plan premium pay-
ments for participating insurers and process such 
premium payments. 
(7) Each purchasing pool operator shall rec-
oncile from year to year aggregate premium pay-
ments and claims costs of private group health in-
surance plans consistent with practices under the 
Federal employees’ health benefits program under 
chapter 89 of title 5, United States Code. 
(8) Each purchasing pool operator shall offer 
customer service to eligible individuals enrolled for 
health benefits coverage under a private group 
health insurance plan offered by a participating in-
surer. 
(9) Each purchasing pool operator shall ensure 
that each eligible individual has the option of enroll-
ing in either of at least 2 benchmark or benchmark- 
equivalent plans with— 
(A) a premium at or below a cap estab-
lished by the pool operator for purposes of this 
title; and 
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(B) coverage of essential services included 
in the report required under section 501(e)(2), 
with cost-sharing consistent with such report. 
(10) Each purchasing pool operator shall estab-
lish a premium cap for purposes of determining the 
credit limitation under section 36(c) of the Internal 
Revenue Code of 1986, as added by section 311(a). 
The cap required under this paragraph may not be 
less than the premium charged to Federal employees 
by the most highly-enrolled health plan under the 
Federal employees’ health benefits program under 
chapter 89 of title 5, United States Code. If the 
most highly-enrolled plan in that program differs for 
Federal enrollees in the State and all Federal enroll-
ees nationally in such plan, the minimum permitted 
premium cap shall be the lower of such premiums. 
SEC. 405. CONTRACTS WITH PARTICIPATING INSURERS. 
(a) IN GENERAL.—Each purchasing pool operator 
shall negotiate and enter into contracts for the provision 
of health benefits coverage under the program under this 
title with entities that meet the conditions of participation 
described in subsection (b) and other applicable require-
ments of this Act. 
(b) CONSUMER INFORMATION.—In carrying out its 
duty under section 404(c)(4) to inform eligible individuals 
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