I 
109TH CONGRESS 
1ST SESSION H. R. 2355
To amend the Public Health Service Act to provide for cooperative governing 
of individual health insurance coverage offered in interstate commerce. 
IN THE HOUSE OF REPRESENTATIVES 
MAY 12, 2005
Mr. SHADEGG (for himself, Mr. AKIN, Mr. BARTLETT of Maryland, Mr. CAN-
NON, Mr. CARTER, Mr. COLE of Oklahoma, Mr. COX, Mrs. CUBIN, Mr. 
FEENEY, Mr. FLAKE, Mr. FRANKS of Arizona, Mr. GUTKNECHT, Mr. 
HENSARLING, Mr. HERGER, Mr. HOEKSTRA, Mr. HOSTETTLER, Mr. 
ISTOOK, Mr. JONES of North Carolina, Mr. KENNEDY of Minnesota, Mr. 
KING of Iowa, Mr. LINDER, Mr. MCHENRY, Mr. MILLER of Florida, Mrs. 
MUSGRAVE, Mrs. MYRICK, Mr. OTTER, Mr. PAUL, Mr. PENCE, Mr. 
PRICE of Georgia, Mr. RADANOVICH, Mr. RENZI, Mr. ROHRABACHER, 
Mr. RYAN of Wisconsin, Mr. RYUN of Kansas, Mr. SENSENBRENNER, 
Mr. SESSIONS, Mr. SOUDER, Mr. WAMP, Mr. WELDON of Florida, Mr. 
WICKER, Mr. WILSON of South Carolina, and Mr. GREEN of Wisconsin) 
introduced the following bill; which was referred to the Committee on En-
ergy and Commerce 
A BILL 
To amend the Public Health Service Act to provide for 
cooperative governing of individual health insurance cov-
erage offered in interstate commerce.
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 ‘‘Health Care Choice Act 
of 2005’’. 
SEC. 2. SPECIFICATION OF CONSTITUTIONAL AUTHORITY 
FOR ENACTMENT OF LAW. 
This Act is enacted pursuant to the power granted 
Congress under article I, section 8, clause 3, of the United 
States Constitution. 
SEC. 3. FINDINGS. 
Congress finds the following: 
(1) The application of numerous and significant 
variations in State law impacts the ability of insur-
ers to offer, and individuals to obtain, affordable in-
dividual health insurance coverage, thereby impeding 
commerce in individual health insurance coverage. 
(2) Individual health insurance coverage is in-
creasingly offered through the Internet, other elec-
tronic means, and by mail, all of which are inher-
ently part of interstate commerce. 
(3) In response to these issues, it is appropriate 
to encourage increased efficiency in the offering of 
individual health insurance coverage through a col-
laborative approach by the States in regulating this 
coverage. 
(4) The establishment of risk-retention groups 
has provided a successful model for the sale of insur-
ance across State lines, as the acts establishing 
those groups allow insurance to be sold in multiple 
States but regulated by a single State. 
SEC. 
4. 
COOPERATIVE 
GOVERNING 
OF 
INDIVIDUAL 
HEALTH INSURANCE COVERAGE. 
(a) IN GENERAL.—Title XXVII of the Public Health 
Service Act (42 U.S.C. 300gg et seq.) is amended by add-
ing at the end the following new part: 
‘‘PART D—COOPERATIVE GOVERNING OF INDIVIDUAL 
HEALTH INSURANCE COVERAGE 
‘‘SEC. 2795. DEFINITIONS. 
‘‘In this part: 
‘‘(1) PRIMARY
STATE.—The term ‘primary 
State’ means, with respect to individual health insur-
ance coverage offered by a health insurance issuer, 
the State designated by the issuer as the State 
whose covered laws shall govern the health insurance 
issuer in the sale of such coverage under this part. 
An issuer, with respect to a particular policy, may 
only designate one such State as its primary State 
with respect to all such coverage it offers. Such an 
issuer may not change the designated primary State 
with respect to individual health insurance coverage 
once the policy is issued, except that such a change 
may be made upon renewal of the policy. With re-
spect to such designated State, the issuer is deemed 
to be doing business in that State. 
‘‘(2) SECONDARY STATE.—The term ‘secondary 
State’ means, with respect to individual health insur-
ance coverage offered by a health insurance issuer, 
any State that is not the primary State. In the case 
of a health insurance issuer that is selling a policy 
in, or to a resident of, a secondary State, the issuer 
is deemed to be doing business in that secondary 
State. 
‘‘(3) HEALTH INSURANCE ISSUER.—The term 
‘health insurance issuer’ has the meaning given such 
term in section 2791(b)(2), except that such an 
issuer must be licensed in the primary State and be 
qualified to sell individual health insurance coverage 
in that State. 
‘‘(4) INDIVIDUAL
HEALTH
INSURANCE
COV-
ERAGE.—The term ‘individual health insurance cov-
erage’ means health insurance coverage offered in 
the individual market, as defined in section 
2791(e)(1). 
‘‘(5) APPLICABLE
STATE
AUTHORITY.—The 
term ‘applicable State authority’ means, with respect 
to a health insurance issuer in a State, the State in-
surance commissioner or official or officials des-
ignated by the State to enforce the requirements of 
this title for the State with respect to the issuer. 
‘‘(6) HAZARDOUS FINANCIAL CONDITION.—The 
term ‘hazardous financial condition’ means that, 
based on its present or reasonably anticipated finan-
cial condition, a health insurance issuer is unlikely 
to be able—
‘‘(A) to meet obligations to policyholders 
with respect to known claims and reasonably 
anticipated claims; or 
‘‘(B) to pay other obligations in the normal 
course of business. 
‘‘(7) COVERED LAWS.—The term ‘covered laws’ 
means the laws, rules, regulations, agreements, and 
orders governing the insurance business pertaining 
to—
‘‘(A) individual health insurance coverage 
issued by a health insurance issuer; 
‘‘(B) the offer, sale, and issuance of indi-
vidual health insurance coverage to an indi-
vidual; and 
‘‘(C) the provision to an individual in rela-
tion to individual health insurance coverage 
of—