I
105TH CONGRESS
1ST SESSION
H. R. 1191
To provide patients with information and rights to promote better health
care.
IN THE HOUSE OF REPRESENTATIVES
MARCH 20, 1997
Mr. OWENS introduced the following bill; which was referred to the Committee
on Commerce, and in addition to the Committee on Ways and Means,
for a period to be subsequently determined by the Speaker, in each case
for consideration of such provisions as fall within the jurisdiction of the
committee concerned
A BILL
To provide patients with information and rights to promote
better health care.
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
‘‘Patient and Health Care Provider Protection Act of
1997’’.
(b) TABLE OF CONTENTS.—The table of contents of
this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Findings.
Sec. 3. Definitions.
TITLE I—HEALTH PLAN REQUIREMENTS
Sec. 101. Interference with medical communication prohibited.
Sec. 102. Improper incentive plan prohibited.
Sec. 103. Provisions regarding denial of care.
Sec. 104. Quality of care.
Sec. 105. Privacy.
Sec. 106. Fee.
Sec. 107. Enforcement through civil penalties.
Sec. 108. Prohibition on adverse action.
TITLE II—OFFICE OF CONSUMER ADVOCACY FOR HEALTH
Sec. 201. Establishment of office.
Sec. 202. Assistance to individuals with grievances against a health plan.
Sec. 203. Assurance of access by all individuals to quality health care.
Sec. 204. Federal investigation and emergency intervention.
Sec. 205. Annual report to the secretary.
Sec. 206. Office administration.
Sec. 207. Oversight.
Sec. 208. Funding of office.
TITLE III—INDEPENDENT CONSUMER ADVISORY COMMITTEES
Sec. 301. Establishment of committees.
Sec. 302. Membership and chair.
Sec. 303. Functions of committee.
Sec. 304. Liability of members of committee.
Sec. 305. Annual report to office.
Sec. 306. Funding for committees.
TITLE IV—COORDINATION AMONG OFFICE, COMMITTEES, AND
SECRETARY
Sec. 401. Interaction among office and other organizations.
Sec. 402. Assistance to committees.
Sec. 403. Coordinated data analysis and dissemination procedure.
SEC. 2. FINDINGS.
The Congress finds the following:
(1) The largest category of health spending is
hospital services; in 1994, 35 percent of national
health spending was for hospital services worth
$338,500,000,000.
(2) The hospital industry exhibits the fastest
rising costs in the health care sector.
(3) The largest expenditures for the hospital in-
dustry are payroll (wages and salaries) and employee
benefits; in 1992, payroll and employee benefits ac-
counted for almost 55 percent of total hospital ex-
penses.
(4) Because registered nurses and licensed
practical nurses comprise the majority of a hospital’s
expenses, in an effort to remain competitive, hos-
pitals are restructuring their operations by decreas-
ing payroll and benefit outlays for registered nurses
and licensed practical nurses and either decreasing
their number or replacing them with unlicensed
aides to care directly for patients.
(5) While this reorganization is taking place, no
mandatory, national, and systematic compilation of
data is being undertaken to determine the correla-
tion between skilled nursing care and patient safety.
(6) Several studies, however, have noted a basic
relationship between skilled nursing care and patient
safety: increased deaths result when inadequate
nursing and lower levels of registered nurses and li-
censed practical nurses in combination with higher
levels of unlicensed aides are utilized by health care
facilities.
(7) A comprehensive effort is needed at the na-
tional level to collect data and develop a research
and evaluation agenda so that informed policy devel-
opment, implementation and evaluation are under-
taken in a timely manner to protect the safety of pa-
tients, the well being of health care workers, and the
integrity of the United States medical system.
(8) The quality of available health care will suf-
fer in the United States if health care delivery is al-
lowed to set priorities in which profit is made at the
expense of patient care quality and safety.
(9) Core clinical staff, such as registered nurses
and licensed practical nurses, are a key component
in increasing quality, understanding patient care
needs, and balancing costs in any reformed health
care system.
(10) Health care is a basic and universal need;
therefore, the right of any consumer to have access
to one’s own confidential medical records and perti-
nent information on the health care facility that is
delivering health care and to participate effectively
in the process of improving the delivery and quality
of such care should not be impaired.
SEC. 3. DEFINITIONS.
In this Act:
(i) the provider and a current, former,
or prospective patient (or the guardian or
legal representative of a patient);
(ii) the provider and any employee or
representative of the such plan; or
(iii) the provider and any employee or
representative of any State or Federal au-
thority with responsibility for the licensing
or oversight with respect to such plan; and
(2) includes communications concerning—
(A) any tests, consultations, and treatment
options;
(B) any risks or benefits associated with
such test, consultations, and options;
(C) variation among any health care pro-
viders and any institutions providing such serv-
ices in experience, quality, or outcomes;
(D) the basis or standard for the decision
of a health plan to authorize or deny health
care services or benefits;
(E) the process used by such a plan to de-
termine whether to authorize or deny health
care services or benefits; and
(F) any financial incentives or disincen-
tives provided by such a plan to a health care
provider that are based on service utilization.
(c) NON-PREEMPTION OF STATE LAW.—A State may
establish or enforce requirements with respect to the sub-
ject matter of this section, but only if such requirements
are more protective of a medical communication than the
requirements established under this section.
(d) EFFECTIVE DATE.—Subsection (a) shall apply to
contracts or agreements entered into or renewed on or
after the date of the enactment of this Act, and to con-
tracts and agreements entered into before such date as
of 30 days after the date of the enactment of this Act.
SEC. 102. IMPROPER INCENTIVE PLAN PROHIBITED.
(a) IN GENERAL.—A health plan may not as part of
any contract or agreement with a health care provider op-
erate an improper health care provider incentive plan as
described in subsection (b).
(b) IMPROPER INCENTIVE PLAN.—For purposes of
subsection (a), a health care provider incentive plan is im-
proper, unless such plan meets the requirements of section
1876(i)(8)(A) of the Social Security Act (42 U.S.C.
1395mm(i)(8)(A)) for physician incentive plans in con-
tracts with eligible organizations under section 1876 of
such Act.
(c) INCENTIVE PLAN DEFINED.—In this section, the
term ‘‘health care provider incentive plan’’ means any
compensation or other financial arrangement between a
health plan and a health care provider that may directly
or indirectly have the effect of limiting services provided
with respect to an enrollee.
(d) EFFECTIVE DATE.—Subsection (a) shall apply to
contracts or agreements entered into or renewed on or
after the date of the enactment of this Act, and to con-
tracts and agreements entered into before such date as
of 30 days after the date of the enactment of this Act.
SEC. 103. PROVISIONS REGARDING DENIAL OF CARE.
(a) CRITERIA FOR DENIAL OF CARE.—A health plan
shall establish and maintain written criteria for the denial
of benefits under the plan. Such criteria shall be estab-
lished in consultation with the health care providers who
provide services for which benefits are provided under the
plan.
(b) PRELIMINARY
PHYSICAL
EXAMINATION.—A
health plan shall provide for an initial physical examina-
tion of an enrollee in a timely manner before denying bene-
fits under the plan to the enrollee. Such examination shall
not constitute services under the health plan.
(c) REASON FOR DENIAL OF CARE PROVIDED TO
ENROLLEE; COPY TO COMMITTEE.—
(1) EXPLANATION
TO
ENROLLEE.—A health
plan shall provide in writing to an enrollee, and to
the health care provider recommending care for the
enrollee, the reason for the denial of services under
the plan to the enrollee.
(2) COPY
TO
COMMITTEE.—The health plan
shall file with its Committee a copy of the reason for
such denial.
(d) PUBLICATION AND TRANSMISSION OF CRITERIA
FOR DENIAL OF CARE.—
(1) PUBLICATION.—A health plan shall put in
writing and make available to its enrollees through
the Office and its Committee the written criteria es-
tablished under subsection (a).
(2) TRANSMISSION.—The health plan shall
maintain on file with the State agency that regulates
such plan and to the Secretary a copy of such cri-
teria.
(e) EFFECTIVE DATE.—The criteria established and
maintained under this section shall apply to plan years
beginning on or after 180 days after the date of the enact-
ment of this Act.
SEC. 104. QUALITY OF CARE.
(a) CRITERIA FOR QUALITY OF CARE.—
(1) IN GENERAL.—A health plan, in consulta-
tion with the health care providers who provide
health services under the plan, shall establish cri-
teria to assure the quality of care provided under the
plan. Such plan shall establish such criteria utilizing
the data collected and analyzed under subsection (c)
and (d), and under section 403.
(2) DEADLINE.—The criteria under paragraph
(1) shall apply to plan years beginning on or after
2 years after the date of the enactment of this Act.
(b) PUBLIC ACCESS TO INFORMATION.—
(1) PUBLICATION
OF
CRITERIA
TO
ASSURE
QUALITY OF CARE.—A health plan shall put in writ-
ing, annually update, and make available the written
criteria established under subsection (a) to its enroll-
ees through the plan’s Committee.
(2) SAFE STAFFING LEVELS.—
(A) IN GENERAL.—Not later than 1 year
after the date of the enactment of this Act, the
Secretary shall, by rule, establish guidelines
that determine the number and classifications
of health care providers necessary to ensure
safe and adequate staffing in relation to enroll-
ees under a health plan.
(B) FACTORS.—Such guidelines shall be
based on—
(i) the severity of illness of each en-
rollee;
(ii) factors affecting the period and
quality of recovery of each enrollee; and
(iii) any other factor substantially re-
lated to the condition and health care
needs of each enrollee.
(3) SAFE AND ADEQUATE STAFFING LEVELS.—
(A) IN
GENERAL.—Not later than 180
days after the date the Secretary establishes the
guidelines under paragraph (2), a health plan
may not provide or pay for health care services
provided to an enrollee at an institution unless
such institution complies with such guidelines.
(B) SUBMISSION
OF
PROPOSED
STAND-
ARDS TO COMMITTEE.—In the case of an insti-
tution that elects not to adopt the guidelines es-
tablished under paragraph (2), such institution
shall submit proposed staffing levels to the
health plan and its Committee for review. Such
institution shall include with its submission an
explanation of the method and criteria used in
developing the proposed staffing levels.
expiration upon 180 days notice to the Sec-
retary.
(H) TERMINATION BY THE SECRETARY.—
The Secretary, in consultation with the Sec-
retary of Labor, may terminate the grant prior
to its expiration upon 180 days notice to the or-
ganization if the Secretary, in consultation with
the Secretary of Labor, determines that the or-
ganization is not meeting the requirements of
this section or that the organization is failing
substantially to carry out the grant. The Sec-
retary, in consultation with the Secretary of
Labor, shall provide for an appropriate appeals
mechanism, including establishment of a panel
of peers, to implement this subparagraph.
(c) DELEGATIONS TO LOCAL OFFICES.—
(1) IN GENERAL.—The Secretary, in consulta-
tion with the Secretary of Labor, shall provide for
appropriate delegation by the Consumer Advocate
for Health of the authority and responsibilities of
the Office to local offices to the extent necessary to
effectively carry out the duties and responsibilities of
the Consumer Advocate for Health throughout the
State.
(2) MONITORING.—The Secretary, in consulta-
tion with the Secretary of Labor, shall develop and
maintain policies and procedures for monitoring
such local offices and ensuring compliance by such
local offices with the terms of such delegation.
(3) PLACEMENT
OF
LOCAL
OFFICE
IN
EACH
COMMUNITY RATING AREA.—
(A) IN GENERAL.—Pursuant to such dele-
gation, the Consumer Advocate for Health shall
ensure that there is located in each community
rating area in the State an officer or employee
of the Office who is designated to assist individ-
uals residing in the area with respect to matters
relating to health plans and health care provid-
ers operating in the area.
(B) ASSIGNMENT
OF
STAFF
FOR
EACH
PLAN.—Each such office for such area shall
have an individual who is assigned with respect
to each health plan that enrolls individuals re-
siding in the area. Such an individual may be
assigned to more than one plan.
(C) APPROPRIATE STAFFING.—The Office
shall ensure that sufficient staff in each local
office is assigned to work with respect to mat-
ters relating to each health plan whose enrollees
are served by the local office so as to ensure ef-
fective and efficient service in such local office
with respect to matters relating to such plan.
(d) 
ESTABLISHMENT
OF
COMMUNITY
RATING
AREAS.—
(1) IN GENERAL.—The Secretary shall provide
for the division of each State into 1 or more commu-
nity rating areas. Each portion of the State shall be
within 1, and only 1, community rating area. The
Secretary may revise the boundaries of such areas
from time to time consistent with this subsection.
(2) MULTIPLE AREAS.—With respect to a com-
munity rating area—
(A) no metropolitan statistical area in a
State may be incorporated into more than 1
such area in the State;
(B) the number of individuals residing
within such an area may not be less than
250,000; and
(C) no area incorporated in a community
rating area may be incorporated into another
such area.
(3) BOUNDARIES.—
(A) IN GENERAL.—In establishing bound-
aries for community rating areas, the Secretary
may not discriminate on the basis of or other-
wise take into account race, age, language, reli-
gion, national origin, socio-economic status, sex-
ual orientation, disability, or perceived health
status.
(B) TREATMENT OF CONSOLIDATED MET-
ROPOLITAN STATISTICAL AREAS.—A community
rating area that includes all of a Consolidated
Metropolitan Statistical Area that is within a
State is presumed to meet the requirement of
subparagraph (A).
SEC. 202. ASSISTANCE TO INDIVIDUALS WITH GRIEVANCES
AGAINST A HEALTH PLAN.
(a) IN GENERAL.—An Office shall provide an individ-
ual assistance with determining, in connection with any
stated grievance against a health plan, the manner and
extent to which such grievance may be presented as—
(1) an issue of denial of items or services, or re-
imbursement therefor;
(2) an issue of denial of medical records;
(3) an issue of malpractice;
(4) an issue of discrimination;
(5) an issue of eligibility and payment of sub-
sidies for premium payments and cost sharing;
(6) an issue of enrollment; or
(7) any other violation actionable under this
Act.
(b) GRIEVANCE ASSISTANCE.—Such Office shall pro-
vide, in person and by toll–free telephone access, assist-
ance to an individual with a grievance under subsection
(a).
(c) COMPLAINT FORMS.—Such Office shall create an
instruction sheet that explains how to file, maintain, and
resolve a complaint against a health plan, and provide
such sheet to an individual seeking to file a complaint
against a health plan. Such instruction sheet shall be writ-
ten in plain language understandable by a layperson, and
it shall use a step-by-step format to guide the layperson
through each stage of the complaint process.
SEC. 203. ASSURANCE OF ACCESS BY ALL INDIVIDUALS TO
QUALITY HEALTH CARE.
(a) IN GENERAL.—An Office shall identify, inves-
tigate, publicize, promote solutions to, and resolve griev-
ances stemming from, any practice, policy, law, or regula-
tion of a health plan that may adversely affect access by
an individual to quality health care, including a practice,
policy, law, or regulation relating to—
(1) marketing of the plan;
(2) availability of premium and cost sharing
subsidies;
(3) accessibility of services and resources in tra-
ditionally underserved areas;
(4) targeting of resources to traditionally un-
derserved areas; and
(5) elimination of practices that impede access
to available choices for individuals at health risk, in-
cluding the proper implementation of community
rating and risk adjustments.
(b) MONITORING OF HEALTH PLAN DENIAL PROCE-
DURES.—Such Office shall monitor procedures used by
health plans for denial of services and for reconsideration
of such denials.
SEC. 204. FEDERAL INVESTIGATION AND EMERGENCY
INTERVENTION.
(a) IN GENERAL.—An Office shall provide, in person
and by toll–free telephone access, assistance to an individ-
ual who seeks to report dangerous conditions in health
care services offered under a health plan.
(b) FEDERAL INTERVENTION.—The Secretary may,
in cases of compromised safety that are life threatening,
initiate emergency investigation of or remedial interven-
tion in services provided or practices undertaken by a
health plan.
(c) RULES.—
SEC. 403. COORDINATED DATA ANALYSIS AND DISSEMINA-
TION PROCEDURE.
(a) DATA COMPILATION AND SUBMISSION.—
(1) IN
GENERAL.—Not later than December
31st of each year, each Committee shall prepare a
summary of its activities under sections 104 and
303 and shall submit such summary to the Office
from which such Committee received its funds under
section 306.
(2) TRANSMISSION FROM STATE TO COMMIT-
TEE.—Not later than October 31st of each year, the
State agency regulating health plans in the State
shall submit the analysis under 104(d)(1) to the
Committees in the State.
(3) TRANSMISSION FROM COMMITTEES TO OF-
FICE.—Not later than November 30th of each year,
Committees shall compile and analyze information
described in sections 104(c)(1) and (c)(2)(B) and
submit such information to the Office for the State
from which such Committee received its funds under
section 306.
(4) TRANSMISSION
FROM
OFFICE
TO
SEC-
RETARY.—Not later than December 31st of each
year, the Office shall compile all data received under
this Act and shall submit such data to the Secretary.
(b) DATA ANALYSIS AND PUBLICATION.—The Sec-
retary shall analyze the data received under subsection
(a)(4). Based upon such analysis, the Secretary shall de-
velop and publish guidelines for patient care quality and
shall publish the Secretary’s analysis.
(c) USE
OF GUIDELINES
FOR EVALUATION
OF
HEALTH PLAN.—An Office and the Committees shall use
such guidelines and analysis to evaluate the performance
of health plans operating in their community rating areas.
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