H. R. 2015—248
be owed by the individual if the organization had directly
provided the services.
‘‘(7) ANTIDISCRIMINATION.—A medicaid managed care
organization shall not discriminate with respect to participa-
tion, reimbursement, or indemnification as to any provider
who is acting within the scope of the provider’s license or
certification under applicable State law, solely on the basis
of such license or certification. This paragraph shall not be
construed to prohibit an organization from including providers
only to the extent necessary to meet the needs of the organiza-
tion’s enrollees or from establishing any measure designed to
maintain quality and control costs consistent with the respon-
sibilities of the organization.
‘‘(8) COMPLIANCE WITH CERTAIN MATERNITY AND MENTAL
HEALTH
REQUIREMENTS.—Each 
medicaid 
managed 
care
organization shall comply with the requirements of subpart
2 of part A of title XXVII of the Public Health Service Act
insofar as such requirements apply and are effective with
respect to a health insurance issuer that offers group health
insurance coverage.’’.
(b) PROTECTION
OF ENROLLEES AGAINST BALANCE BILLING
THROUGH
SUBCONTRACTORS.—Section 
1128B(d)(1) 
(42 
U.S.C.
1320a–7b(d)(1)) is amended by inserting ‘‘(or, in the case of services
provided to an individual enrolled with a medicaid managed care
organization under title XIX under a contract under section 1903(m)
or under a contractual, referral, or other arrangement under such
contract, at a rate in excess of the rate permitted under such
contract)’’ before the comma at the end.
SEC. 4705. QUALITY ASSURANCE STANDARDS.
(a) IN GENERAL.—Section 1932 is further amended by adding
at the end the following:
‘‘(c) QUALITY ASSURANCE STANDARDS.—
‘‘(1) QUALITY ASSESSMENT AND IMPROVEMENT STRATEGY.—
‘‘(A) IN
GENERAL.—If a State provides for contracts
with medicaid managed care organizations under section
1903(m), the State shall develop and implement a quality
assessment and improvement strategy consistent with this
paragraph. Such strategy shall include the following:
‘‘(i) ACCESS STANDARDS.—Standards for access to
care so that covered services are available within
reasonable timeframes and in a manner that ensures
continuity of care and adequate primary care and
specialized services capacity.
‘‘(ii) OTHER
MEASURES.—Examination of other
aspects of care and service directly related to the
improvement of quality of care (including grievance
procedures and marketing and information standards).
‘‘(iii) MONITORING
PROCEDURES.—Procedures for
monitoring and evaluating the quality and appropriate-
ness of care and services to enrollees that reflect the
full spectrum of populations enrolled under the con-
tract and that includes requirements for provision of
quality assurance data to the State using the data
and information set that the Secretary has specified
for use under part C of title XVIII or such alternative
H. R. 2015—249
data as the Secretary approves, in consultation with
the State.
‘‘(iv) 
PERIODIC
REVIEW.—Regular, 
periodic
examinations of the scope and content of the strategy.
‘‘(B) 
STANDARDS.—The 
strategy 
developed 
under
subparagraph (A) shall be consistent with standards that
the Secretary first establishes within 1 year after the date
of the enactment of this section. Such standards shall not
preempt any State standards that are more stringent than
such standards. Guidelines relating to quality assurance
that are applied under section 1915(b)(1) shall apply under
this subsection until the effective date of standards for
quality assurance established under this subparagraph.
‘‘(C) MONITORING.—The Secretary shall monitor the
development and implementation of strategies under
subparagraph (A).
‘‘(D) CONSULTATION.—The Secretary shall conduct
activities under subparagraphs (B) and (C) in consultation
with the States.
‘‘(2) EXTERNAL
INDEPENDENT
REVIEW
OF
MANAGED
CARE
ACTIVITIES.—
‘‘(A) REVIEW OF CONTRACTS.—
‘‘(i) IN
GENERAL.—Each contract under section
1903(m) with a medicaid managed care organization
shall provide for an annual (as appropriate) external
independent review conducted by a qualified independ-
ent entity of the quality outcomes and timeliness of,
and access to, the items and services for which the
organization is responsible under the contract. The
requirement for such a review shall not apply until
after the date that the Secretary establishes the identi-
fication method described in clause (ii).
‘‘(ii) QUALIFICATIONS
OF
REVIEWER.—The Sec-
retary, in consultation with the States, shall establish
a method for the identification of entities that are
qualified to conduct reviews under clause (i).
‘‘(iii) USE
OF
PROTOCOLS.—The Secretary, in
coordination with the National Governors’ Association,
shall contract with an independent quality review
organization (such as the National Committee for Qual-
ity Assurance) to develop the protocols to be used in
external independent reviews conducted under this
paragraph on and after January 1, 1999.
‘‘(iv) AVAILABILITY
OF
RESULTS.—The results of
each external independent review conducted under this
subparagraph shall be available to participating health
care providers, enrollees, and potential enrollees of
the organization, except that the results may not be
made available in a manner that discloses the identity
of any individual patient.
‘‘(B) NONDUPLICATION
OF
ACCREDITATION.—A State
may provide that, in the case of a medicaid managed care
organization that is accredited by a private independent
entity (such as those described in section 1852(e)(4)) or
that has an external review conducted under section
1852(e)(3), the external review activities conducted under
subparagraph (A) with respect to the organization shall
H. R. 2015—250
not be duplicative of review activities conducted as part
of the accreditation process or the external review con-
ducted under such section.
‘‘(C) DEEMED
COMPLIANCE
FOR
MEDICARE
MANAGED
CARE ORGANIZATIONS.—At the option of a State, the require-
ments of subparagraph (A) shall not apply with respect
to a medicaid managed care organization if the organization
is an eligible organization with a contract in effect under
section 1876 or a Medicare+Choice organization with a
contract in effect under C of title XVIII and the organiza-
tion has had a contract in effect under section 1903(m)
at least during the previous 2-year period.
(b) INCREASED FFP FOR EXTERNAL QUALITY REVIEW ORGANIZA-
TIONS.—Section 1903(a)(3)(C) (42 U.S.C. 1396b(a)(3)(C)) is amend-
ed—
(1) by inserting ‘‘(i)’’ after ‘‘(C)’’, and
(2) by adding at the end the following new clause:
‘‘(ii) 75 percent of the sums expended with respect
to costs incurred during such quarter (as found necessary
by the Secretary for the proper and efficient administration
of the State plan) as are attributable to the performance
of independent external reviews conducted under section
1932(c)(2); and’’.
(c) STUDIES AND REPORTS.—
(1) GAO STUDY AND REPORT ON QUALITY ASSURANCE AND
ACCREDITATION STANDARDS.—
(A) STUDY.—The Comptroller General of the United
States shall conduct a study and analysis of the quality
assurance programs and accreditation standards applicable
to managed care entities operating in the private sector,
or to such entities that operate under contracts under
the medicare program under title XVIII of the Social Secu-
rity Act (42 U.S.C. 1395 et seq.). Such study shall deter-
mine—
(i) if such programs and standards include consid-
eration of the accessibility and quality of the health
care items and services delivered under such contracts
to low-income individuals; and
(ii) the appropriateness of applying such programs
and standards to medicaid managed care organizations
under section 1932(c) of such Act.
(B) REPORT.—The Comptroller General shall submit
a report to the Committee on Commerce of the House
of Representatives and the Committee on Finance of the
Senate on the study conducted under subparagraph (A).
(2) STUDY AND REPORT ON SERVICES PROVIDED TO INDIVID-
UALS WITH SPECIAL HEALTH CARE NEEDS.—
(A) STUDY.—The Secretary of Health and Human Serv-
ices, in consultation with States, managed care organiza-
tions, the National Academy of State Health Policy, rep-
resentatives of beneficiaries with special health care needs,
experts in specialized health care, and others, shall conduct
a study concerning safeguards (if any) that may be needed
to ensure that the health care needs of individuals with
special health care needs and chronic conditions who are
enrolled with medicaid managed care organizations are
adequately met.
H. R. 2015—251
(B) REPORT.—Not later than 2 years after the date
of the enactment of this Act, the Secretary shall submit
to Committees described in paragraph (1)(B) a report on
such study.
SEC. 4706. SOLVENCY STANDARDS.
Section 1903(m)(1) (42 U.S.C. 1396b(m)(1)) is amended—
(1) in subparagraph (A)(ii), by inserting ‘‘, meets the
requirements of subparagraph (C)(i) (if applicable),’’ after
‘‘provision is satisfactory to the State’’, and
(2) by adding at the end the following:
‘‘(C)(i) Subject to clause (ii), a provision meets the requirements
of this subparagraph for an organization if the organization meets
solvency standards established by the State for private health
maintenance organizations or is licensed or certified by the State
as a risk-bearing entity.
‘‘(ii) Clause (i) shall not apply to an organization if—
‘‘(I) the organization is not responsible for the provision
(directly or through arrangements with providers of services)
of inpatient hospital services and physicians’ services;
‘‘(II) the organization is a public entity;
‘‘(III) the solvency of the organization is guaranteed by
the State; or
‘‘(IV) the organization is (or is controlled by) one or more
Federally-qualified health centers and meets solvency stand-
ards established by the State for such an organization.
For purposes of subclause (IV), the term ‘control’ means the posses-
sion, whether direct or indirect, of the power to direct or cause
the direction of the management and policies of the organization
through membership, board representation, or an ownership
interest equal to or greater than 50.1 percent.’’.
SEC. 4707. PROTECTIONS AGAINST FRAUD AND ABUSE.
(a) IN GENERAL.—Section 1932 (42 U.S.C. 1396v) is further
amended by adding at the end the following:
‘‘(d) PROTECTIONS AGAINST FRAUD AND ABUSE.—
‘‘(1) PROHIBITING AFFILIATIONS WITH INDIVIDUALS DEBARRED
BY FEDERAL AGENCIES.—
‘‘(A) IN
GENERAL.—A managed care entity may not
knowingly—
‘‘(i) have a person described in subparagraph (C)
as a director, officer, partner, or person with beneficial
ownership of more than 5 percent of the entity’s equity,
or
‘‘(ii) have an employment, consulting, or other
agreement with a person described in such subpara-
graph for the provision of items and services that are
significant and material to the entity’s obligations
under its contract with the State.
‘‘(B) EFFECT OF NONCOMPLIANCE.—If a State finds that
a managed care entity is not in compliance with clause
(i) or (ii) of subparagraph (A), the State—
‘‘(i) shall notify the Secretary of such noncompli-
ance;
‘‘(ii) may continue an existing agreement with the
entity unless the Secretary (in consultation with the
Inspector General of the Department of Health and
Human Services) directs otherwise; and