I
105TH CONGRESS
2D SESSION
H. R. 4093
To amend the Public Health Service Act and Employee Retirement Income
Security Act of 1974 to require group health plans and health insurance
coverage to establish hospital lengths of stay based on a determination
by an appropriate physician in consultation with the patient.
IN THE HOUSE OF REPRESENTATIVES
JUNE 19, 1998
Ms. DELAURO (for herself, Mr. HILLIARD, Mr. HASTINGS of Florida, Mr.
FROST, Mr. KLECZKA, Mr. SANDLIN, Mr. LAMPSON, Ms. PELOSI, Mr.
MALONEY of Connecticut, Mr. WYNN, Mr. MENENDEZ, Mr. LEWIS of
Georgia, and Mr. CUMMINGS) introduced the following bill; which was re-
ferred to the Committee on Commerce, and in addition to the Committee
on Education and the Workforce, for a period to be subsequently deter-
mined by the Speaker, in each case for consideration of such provisions
as fall within the jurisdiction of the committee concerned
A BILL
To amend the Public Health Service Act and Employee Re-
tirement Income Security Act of 1974 to require group
health plans and health insurance coverage to establish
hospital lengths of stay based on a determination by
an appropriate physician in consultation with the patient.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Hospital Stay Protec-
tion Act’’.
SEC. 2. STANDARD RELATING TO HOSPITAL LENGTHS OF
STAY.
(a) GROUP HEALTH PLANS.—
(1) PUBLIC
HEALTH
SERVICE
ACT
AMEND-
MENTS.—
(A) IN GENERAL.—Subpart 2 of part A of
title XXVII of the Public Health Service Act,
as amended by section 703(a) of Public Law
104–204, is amended by adding at the end the
following new section:
‘‘SEC. 2706. STANDARD RELATING TO HOSPITAL LENGTHS
OF STAY.
‘‘(a) REQUIREMENT.—A group health plan, and a
health insurance issuer offering group health insurance
coverage in connection with a group health plan, shall en-
sure that inpatient coverage is provided for a period of
time as is determined by a physician, in consultation with
the patient, to be medically appropriate.
‘‘(b) PROHIBITIONS.—A group health plan, and a
health insurance issuer offering group health insurance
coverage in connection with a group health plan, may
not—
‘‘(1) deny eligibility, or continued eligibility, to
enroll or to renew coverage under the terms of the
plan, solely for the purpose of avoiding the minimum
coverage requirements of subsection (a);
‘‘(2) penalize or otherwise reduce or limit the
reimbursement of a provider because such provider
provided care to a participant or beneficiary in ac-
cordance with this section;
‘‘(3) provide incentives (monetary or otherwise)
to a provider to induce such provider to keep the
length of inpatient stays of patients below certain
levels; or
‘‘(4) require preauthorization for determination
of a length of stay.
‘‘(c) APPEALS PROCESS AND PENALTY.—The Sec-
retary, in consultation with the Secretary of Labor shall
establish—
‘‘(1) a process for a participant, enrollee, or
beneficiary to appeal the decision of a plan or issuer;
and
‘‘(2) a penalty for plans or issuers that violate
the provisions of this section.
‘‘(d) NOTICE.—A group health plan under this part
shall comply with the notice requirement under section
713(d) of the Employee Retirement Income Security Act
of 1974 with respect to the requirements of this section
as if such section applied to such plan.’’.
(B) CONFORMING
AMENDMENT.—Section
2723(c) of such Act (42 U.S.C. 300gg–23(c)) is
amended by striking ‘‘section 2704’’ and insert-
ing ‘‘sections 2704 and 2706’’.
(2) AMENDMENTS TO THE EMPLOYEE RETIRE-
MENT INCOME SECURITY ACT OF 1974.—
(A) IN GENERAL.—Subpart B of part 7 of
subtitle B of title I of the Employee Retirement
Income Security Act of 1974 is amended by
adding at the end the following new section:
‘‘SEC. 713. STANDARDS FOR HOSPITAL LENGTHS OF STAY.
‘‘(a) REQUIREMENT.—A group health plan, and a
health insurance issuer offering group health insurance
coverage in connection with a group health plan, shall en-
sure that inpatient coverage is provided for a period of
time as is determined by a physician, in consultation with
the patient, to be medically appropriate.
‘‘(b) PROHIBITIONS.—A group health plan, and a
health insurance issuer offering group health insurance
coverage in connection with a group health plan, may
not—
‘‘(1) deny eligibility, or continued eligibility, to
enroll or to renew coverage under the terms of the
plan, solely for the purpose of avoiding the minimum
coverage requirements of subsection (a);
‘‘(2) penalize or otherwise reduce or limit the
reimbursement of a provider because such provider
provided care to a participant or beneficiary in ac-
cordance with this section;
‘‘(3) provide incentives (monetary or otherwise)
to a provider to induce such provider to keep the
length of inpatient stays of patients below certain
levels; or
‘‘(4) require preauthorization for determination
of a length of stay.
‘‘(c) APPEALS PROCESS AND PENALTY.—The Sec-
retary, in consultation with the Secretary of Health and
Human Services shall establish—
‘‘(1) a process for a participant, enrollee, or
beneficiary to appeal the decision of a plan or issuer;
and
‘‘(2) a penalty for plans or issuers that violate
the provisions of this section.
‘‘(d) NOTICE UNDER GROUP HEALTH PLAN.—The
imposition of the requirements of this section shall be
treated as a material modification in the terms of the plan
described in section 102(a)(1), for purposes of assuring
notice of such requirements under the plan; except that
the summary description required to be provided under the
last sentence of section 104(b)(1) with respect to such
modification shall be provided by not later than 60 days
after the first day of the first plan year in which such
requirements apply.’’.
(B) CONFORMING
AND
CLERICAL
AMEND-
MENTS.—(i) Section 731(c) of such Act (29 U.S.C.
1191(c)) is amended by striking ‘‘section 711’’ and
inserting ‘‘sections 711 and 713’’.
(ii) Section 732(a) of such Act (29 U.S.C.
1191a(a)) is amended by striking ‘‘section 711’’ and
inserting ‘‘sections 711 and 713’’.
(iii) The table of contents in section 1 of such
Act is amended by inserting after the item relating
to section 712 the following new item:
‘‘Sec. 713. Standard for hospital lengths of stay.’’.
(b) INDIVIDUAL HEALTH INSURANCE.—
(1) IN GENERAL.—Subpart 3 of part B of title
XXVII of the Public Health Service Act is amended
by adding at the end the following new section:
‘‘SEC. 2752. STANDARDS FOR HOSPITAL LENGTHS OF STAY.
‘‘(a) IN GENERAL.—The provisions of section 2706
(other than subsection (d)) shall apply to health insurance
coverage offered by a health insurance issuer in the indi-
vidual market in the same manner as they apply to health
insurance coverage offered by a health insurance issuer
in connection with a group health plan in the small or
large group market.
‘‘(b) NOTICE.—A health insurance issuer under this
part shall comply with the notice requirement under sec-
tion 713(d) of the Employee Retirement Income Security
Act of 1974 with respect to the requirements referred to
in subsection (a) as if such section applied to such issuer
and such issuer were a group health plan.’’.
(2) 
CONFORMING
AMENDMENT.—Section
2762(b)(2) of such Act (42 U.S.C. 300gg–62(b)(2))
is amended by striking ‘‘section 2751’’ and inserting
‘‘sections 2751 and 2752’’.
(c) EFFECTIVE DATES.—
(1) GROUP MARKET REFORMS.—
(A) IN GENERAL.—The amendments made
by subsections (a) and (b) shall apply with re-
spect to plan years beginning on or after Janu-
ary 1, 1999.
(B) SPECIAL RULE FOR COLLECTIVE BAR-
GAINING AGREEMENTS.—In the case of a group
health plan maintained pursuant to 1 or more
collective bargaining agreements between em-
ployee representatives and 1 or more employers
ratified before such date, the amendments made
by such subsections shall not apply to plan
years beginning before the later of—
(i) the date on which the last collec-
tive bargaining agreements relating to the
plan terminates (determined without re-
gard to any extension thereof agreed to
after the date of enactment of this Act), or
(ii) January 1, 1999.
For purposes of clause (i), any plan amendment
made pursuant to a collective bargaining agree-
ment relating to the plan which amends the
plan solely to conform to any requirement
added by such subsections shall not be treated
as a termination of such collective bargaining
agreement.
(2) INDIVIDUAL MARKET AMENDMENTS.—The
amendments made by subsection (b) shall apply with
respect to health insurance coverage offered, sold,
issued, renewed, in effect, or operated in the individ-
ual market on or after January 1, 1999.
(d) COORDINATED REGULATIONS.—Section 104(1)
of Health Insurance Portability and Accountability Act of
1996 is amended by striking ‘‘this subtitle (and the
amendments made by this subtitle and section 401)’’ and
inserting ‘‘the provisions of part 7 of subtitle B of title
I of the Employee Retirement Income Security Act of
1974, the provisions of parts A and C of title XXVII of
the Public Health Service Act, and chapter 100 of the In-
ternal Revenue Code of 1986’’.
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