‘‘SEC. 2776. REQUIRED OBSTETRIC AND GYNECOLOGICAL
CARE.
‘‘(a) OBSTETRICIAN-GYNECOLOGIST
AS
PRIMARY
CARE PROVIDER.—In a case in which a managed care
plan provides for an enrollee to designate a participating
primary care provider, a female enrollee may designate a
physician who specializes in obstetrics and gynecology as
primary care provider.
‘‘(b) NO DESIGNATION
OF OBSTETRICIAN-GYNE-
COLOGIST.—In a case in which an enrollee does not des-
ignate an obstetrician-gynecologist under subsection (a) as
a primary care provider, the plan shall not require prior
authorization by the enrollee’s primary care provider for
coverage of routine gynecological care and pregnancy-re-
lated services provided by a participating physician who
specializes in obstetrics and gynecology.
‘‘SEC. 2777. ASSURING EQUITABLE COVERAGE OF EMER-
GENCY SERVICE.
‘‘(a) IN GENERAL.—A managed care plan shall cover
emergency services furnished to an enrollee of the plan—
‘‘(1) whether or not the provider furnishing the
emergency services has a contractual or other ar-
rangement with the plan for the provision of such
services to such enrollee; and
‘‘(2) without regard to prior authorization.
‘‘(b) EMERGENCY SERVICES.—Emergency services
shall include—
‘‘(1) health care items and services furnished in
the emergency department of a hospital; and
‘‘(2) ancillary services routinely available to
such department.
‘‘(c) EMERGENCY MEDICAL CONDITION.—An emer-
gency medical condition is a medical condition manifesting
itself by acute symptoms of sufficient severity (including
severe pain) such that a prudent layperson, who possesses
an average knowledge of health and medicine, could rea-
sonably expect the absence of immediate medical attention
to result in—
‘‘(1) placing the health of the individual (or,
with respect to a pregnant woman, the health of the
woman or her unborn child) in serious jeopardy;
‘‘(2) serious impairment to bodily functions; or
‘‘(3) serious dysfunction of any bodily organ or
part.
‘‘SEC. 2778. REQUIREMENT FOR SERVICE TO AREAS THAT
INCLUDE A MEDICALLY UNDERSERVED POP-
ULATION.
‘‘A managed care plan seeking to provide services in
an area that includes a medically underserved population
must submit a plan to the Secretary outlining a proposal
for service that ensures access to quality care that is ap-
propriate to the medically underserved population. The
plan shall include the health needs of the medically under-
served population with special consideration given to fac-
tors including age, gender, race, and potential chronic con-
ditions.
‘‘SEC. 2779. RIGHT TO LANGUAGE ASSISTANCE.
‘‘In a case in which 2 percent of the enrollees of a
managed care plan in a service area (as defined in section
2788(b)(9)) are members of a group that speaks English
as a second language or requires special communication
needs, the Secretary shall ensure that the managed care
plan provides communication assistance and bilingual in-
formation, on a continuous basis, to such enrollees. The
plan shall ensure that—
‘‘(1) trained medical interpreters, whose pri-
mary responsibility is to interpret, are present in all
health care settings; and
‘‘(2) an adequate number of health profes-
sionals receive training in cultural competency and
communication skills development as it relates to
medical interviews.
‘‘SEC. 2780. PROHIBITION ON FINANCIAL INCENTIVES TO
LIMIT CARE.
‘‘A managed care plan may not offer any financial
incentives, directly or indirectly, to health professionals as
an inducement to reduce or limit medically necessary serv-
ices provided to an enrollee.
‘‘SEC. 2781. PROHIBITION ON GAG CLAUSES.
‘‘(a) IN GENERAL.—The provisions of any contract
or agreement, or the operation of any contract or agree-
ment, between a managed care plan and a health profes-
sional shall not prohibit or restrict a health professional
from engaging in medical communication with his or her
patient.
‘‘(b) NULLIFICATION.—Any contract provision or
agreement described in subsection (a) shall be null and
void.
‘‘(c) MEDICAL
COMMUNICATION
DEFINED.—For
purposes of this section, the term ‘medical communication’
means a communication made by a health professional
with a patient of the health professional (or the guardian
or legal representative of the patient) with respect to—
‘‘(1) the patient’s health status, medical care,
or legal treatment options;
‘‘(2) any utilization review requirements that
may affect treatment options for the patient; or
‘‘(3) any financial incentives that may affect
the treatment of the patient.
‘‘SEC. 2782. RIGHT TO APPEAL DENIAL OF CARE.
‘‘(a) ESTABLISHMENT OF SYSTEM.—Not later than
90 days after the date of the enactment of the Managed
Care Bill of Rights for Consumers Act of 2001, the Sec-
retary, through the Health Care Financing Administra-
tion, shall establish and implement guidelines for griev-
ance and appeals procedures regarding any aspect of a
managed care plan’s services, including complaints regard-
ing quality of care, choice and accessibility of providers,
network adequacy, and compliance with the requirements
of this part.
‘‘(b) NO REPRISAL FOR EXERCISE OF RIGHTS.—A
managed care plan shall not take any action with respect
to an enrollee or a health care provider that is intended
to penalize the enrollee, a designee of the enrollee, or the
health care provider for discussing or exercising any rights
provided under this part (including the filing of a com-
plaint or appeal pursuant to this section).
‘‘SEC. 2783. EXTERNAL REVIEW.
‘‘An external review process shall be available to en-
rollees after all internal appeal options have been exer-
cised. The requirements for an external review process are
as follows:
‘‘(1) The process is established under State law
and provides for review of decisions made pursuant
to section 2783 by an independent review organiza-
tion certified by the State.
‘‘(2) If the process provides that decisions in
such process are not binding on managed care plans,
the process must provide for public methods of dis-
closing frequency of noncompliance with such deci-
sions and for sanctioning plans that consistently
refuse to take appropriate actions in response to
such decisions.
‘‘(3) Results of all such reviews under the proc-
ess are disclosed to the public, along with at least
annual disclosure of information on managed care
plan compliance.
‘‘(4) All decisions under the process shall be in
writing and shall be accompanied by an explanation
of the basis for the decision.
‘‘(5) Direct costs of the process shall be borne
by the managed care plan, and not by the enrollee.
‘‘(6) The managed care plan shall provide for
publication at least annually of information on the
number of appeals and decisions considered under
the process.
‘‘SEC. 2784. NONDISCRIMINATION RIGHT.
‘‘A managed care plan may not discriminate (directly
or through contractual arrangements) against an enrollee
or a provider on the basis of race, national origin, gender,
language, socioeconomic status, age, disability, health sta-
tus, or anticipated need for health services.
‘‘SEC. 2785. PROTECTION OF PATIENT CONFIDENTIALITY.
‘‘A managed care plan shall establish policies and
procedures to ensure that all applicable laws that protect
the confidentiality of an individual’s medical information
are followed.
‘‘SEC. 2786. ESTABLISHMENT OF MANAGED CARE CON-
SUMER ADVISORY COMMISSION.
‘‘(a) ESTABLISHMENT.—The Secretary shall estab-
lish and appoint a 5 member Managed Care Consumer
Advisory Commission (in this section referred to as the
‘Commission’).
‘‘(b) PURPOSE.—The purpose of the Commission is
to assist consumers in the following areas:
‘‘(1) Accessing appropriate and high-quality
health care services.
‘‘(2) Understanding and exercising their rights
and responsibilities as managed care plan enrollees.
‘‘(3) Making an informed and appropriate
choice of a managed care plan.
‘‘(c) MEMBERSHIP.—Members of the Commission
shall—
‘‘(1) be selected from nonpartisan labor, reli-
gious, human service, or consumer organizations;
and
‘‘(2) demonstrate a commitment to representing
consumers in an equitable manner.
‘‘(d) DUTIES.—
‘‘(1) ANALYZE AND COLLECT INFORMATION.—
The Commission shall collect and analyze informa-
tion for the purpose of identifying—
‘‘(A) recurring barriers to access to health
care for persons enrolled in managed care
plans;
‘‘(B) patterns of national, regional, or local
access problems with special focus on under-
served and vulnerable populations and persons
with chronic illness and disabilities;
‘‘(C) quality of care problems; and
‘‘(D) the extent to which managed care
plans comply with Federal laws, regulations,
and rules governing their responsibilities and
performance.
‘‘(2) PROMOTE SOLUTIONS.—The Commission
shall investigate, identify, and promote solutions re-
garding managed care practices, policies, laws, or
regulations that adversely affect, or fail to promote,
informed access of individuals and populations to
high-quality health care.
‘‘(3) REPORT.—Not later than January 1 of
each year, the Secretary, through the Commission,
shall submit a report to Congress which shall
include—
‘‘(A) a description of the efforts of the
Commission; and
‘‘(B) findings and recommendations based
on problems identified to improve consumer and
enrollee rights and protections so as to facilitate
access to high-quality health care and improve
health outcomes.
‘‘SEC. 2787. REQUIREMENTS FOR PRESCRIPTION DRUG
COVERAGE.
‘‘(a) REQUIREMENT FOR COVERAGE OF MEDICALLY
NECESSARY AND APPROPRIATE DRUGS.—In a case in
which a managed care plan provides coverage for prescrip-
tion drugs, such plan may not limit coverage if a treating
health professional determines that such coverage is medi-
cally necessary and appropriate.
‘‘(b) REQUIREMENT FOR SUBSTITUTING DRUGS.—
‘‘(1) IN
GENERAL.—A determination as to
whether or not a drug prescribed to treat a medical
condition may be substituted with a different drug
may only be made by a treating physician. A man-
aged care plan may not provide a standard for sub-
stituting prescription drugs.
‘‘(2) GENERIC
DRUGS.—A generic drug may
not be substituted for a name brand drug unless it
has the same chemical composition as the name
brand drug.
‘‘(c) LIMITATION ON ACCESS.—A managed care plan
that provides prescription drug coverage may not limit ac-
cess to drugs covered solely on the basis of costs associated
with providing coverage of such drugs.
‘‘SEC. 2788. NOTICE; DEFINITIONS; APPLICATION OF EN-
FORCEMENT PROVISIONS.
‘‘(a) NOTICE.—A managed care plan under this part
shall comply with the notice requirement under section
711(d) of the Employee Retirement Income Security Act
of 1974 with respect to the requirements of this part as
if such section applied to such plan and such plan were
a group health plan.
‘‘(b) DEFINITIONS.—For purposes of this part:
‘‘(1) ENROLLEE.—The term ‘enrollee’ means,
with respect to health insurance coverage offered by
a managed care plan, an individual enrolled with or
otherwise covered under the plan to receive such cov-
erage and includes a participant or beneficiary with
respect to a group health plan.
‘‘(2) 
HEALTH
PROFESSIONAL.—The 
term
‘health professional’ means a physician or other
health care practitioner licensed, accredited, or cer-
tified to perform specified health services consistent
with law.
‘‘(3) MANAGED CARE PLAN.—The term ‘man-
aged care plan’ means a group health plan or health
insurance coverage that provides or arranges for the
provision of health care items and services to partici-
pants, beneficiaries, or enrollees primarily through
participating physicians and providers.
‘‘(4) NETWORK.—The term ‘network’ means,
with respect to a managed care plan, the partici-
pating health professionals and providers through
which the plan provides health care items and serv-
ices to enrollees.
‘‘(5) NETWORK COVERAGE.—The term ‘network
coverage’ means coverage offered by a managed care
plan that provides or arranges for the provision of
health care items and services to enrollees through
participating health professionals and providers.
‘‘(6) PARTICIPATING.—The term ‘participating’
means, with respect to a health professional or pro-
vider, a health professional or provider that provides
health care items and services to enrollees under
network coverage under an agreement with the man-
aged care plan offering the coverage.
‘‘(7) PRIOR AUTHORIZATION.—The term ‘prior
authorization’ means the process of obtaining prior
approval from a managed care plan as to the neces-
sity or appropriateness of receiving medical or clin-
ical services for treatment of a medical or clinical
condition.
‘‘(8) PROVIDER.—The term ‘provider’ means a
health organization, health facility, or health agency
that is licensed, accredited, or certified to provide
health care items and services.
‘‘(9) SERVICE AREA.—The term ‘service area’
means, with respect to a managed care plan, the ge-
ographic area served by the plan with respect to the
coverage.
‘‘(c) ENFORCEMENT.—For purposes of enforcing the
provisions of this part under this title, the provisions of
this part shall be treated as if they were part of subpart
2 of part A and as if they were part of subpart 2 of part
B (relating to other requirements).’’.
(b) CONFORMING AMENDMENTS.—Title XXVII of
the Public Health Service Act is further amended—
(1) by redesignating the subpart 3 of part B re-
lating to other requirements as subpart 2; and
(2) in sections 2723(a)(1) (42 U.S.C. 300gg–
23(a)(1)) and subsections (a) and (b)(1) of section
2762 (42 U.S.C. 300gg–62), by striking ‘‘part C’’
and inserting ‘‘part D’’ each place it appears.
SEC. 3. PATIENT PROTECTION STANDARDS UNDER THE EM-
PLOYEE 
RETIREMENT 
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. 714. PATIENT PROTECTION STANDARDS.
‘‘(a) IN GENERAL.—Subject to subsection (b), a
group health plan (and a health insurance issuer offering
group health insurance coverage in connection with such
a plan) shall comply with the requirements of part C of
title XXVII of the Public Health Service Act.
‘‘(b) REFERENCES
IN APPLICATION.—In applying
subsection (a) under this part, any reference in such part
C—
‘‘(1) to a managed care plan and health insur-
ance coverage offered by such a plan is deemed to
include a reference to a group health plan and cov-
erage under such plan, respectively; and
‘‘(2) to the Secretary is deemed a reference to
the Secretary of Labor.
‘‘(c) ENSURING COORDINATION.—The Secretary of
Health and Human Services and the Secretary of Labor
shall ensure, through the execution of an interagency
memorandum of understanding between such Secretaries,
that—
‘‘(1) regulations, rulings, and interpretations
issued by such Secretaries relating to the same mat-
ter over which such Secretaries have responsibility
under such part C and this section are administered
so as to have the same effect at all times; and
‘‘(2) coordination of policies relating to enforc-
ing the same requirements through such Secretaries
in order to have a coordinated enforcement strategy
that avoids duplication of enforcement efforts and
assigns priorities in enforcement.’’.
(b) MODIFICATION OF PREEMPTION STANDARDS.—
Section 731 of such Act (42 U.S.C. 1191) is amended—
(1) in subsection (a)(1), by striking ‘‘subsection
(b)’’ and inserting ‘‘subsections (b) and (c)’’;
(2) by redesignating subsections (c) and (d) as
subsections (d) and (e), respectively; and
(3) by inserting after subsection (b) the fol-
lowing new subsection:
‘‘(c) SPECIAL RULES IN CASE OF PATIENT PROTEC-
TION REQUIREMENTS.—Subject to subsection (a)(2), the
provisions of section 714 and part C of title XXVII of
the Public Health Service Act, and the provisions of this
subpart insofar as it applies to section 714 or such part,
shall not be construed to preempt any State law, or the
enactment or implementation of such a State law, that
provides protections for individuals that are equivalent to
or stricter than the protections provided under such provi-
sions.’’.
(c) CONFORMING AMENDMENTS.—(1) Section 732(a)
of such Act (29 U.S.C. 1185(a)) is amended by striking
‘‘section 711’’ and inserting ‘‘sections 711 and 714’’.
(2) The table of contents in section 1 of such Act
is amended by inserting after the item relating to section
713 the following new item:
‘‘Sec. 714. Patient protection standards.’’.
(3) Section 734 of such Act (29 U.S.C. 1187) is
amended by inserting ‘‘and section 714(c)’’ after ‘‘of
1996’’.
SEC. 4. NONPREEMPTION OF STATE LAW RESPECTING LI-
ABILITY OF MANAGED CARE PLANS.
(a) IN GENERAL.—Section 514(b) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C.
1144(b)) is amended by redesignating paragraph (9) as
paragraph (10) and inserting the following new para-
graph:
‘‘(9) Subsection (a) of this section shall not be con-
strued to preclude any State cause of action to recover
damages for personal injury or wrongful death against any
person that provides insurance or administrative services
to or for a managed care plan. For purposes of this para-
graph, the term ‘managed care plan’ means a group health
plan (within the meaning of sections 732(d) and 733(a))
that provides or arranges for the provision of health care
items and services to participants or beneficiaries pri-
marily through participating physicians and providers.’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to causes of action arising on
or after the date of the enactment of this Act.
SEC. 5. EFFECTIVE DATE.
(a) IN GENERAL.—Subject to subsection (b), the
amendments made by sections 2 and 3 shall apply with
respect to group health plans for plan years beginning on
or after 90 days after the date of the enactment of this
Act, and also shall apply to portions of plan years occur-
ring on and after January 1, 2002. Such amendments
shall apply to individual health insurance coverage on and
after such date.
(b) SPECIAL RULE FOR PLANS UNDER COLLECTIVE
BARGAINING AGREEMENTS.—In the case of a group
health plan maintained pursuant to 1 or more collective
bargaining agreements between employee representatives
and 1 or more employers ratified before the date of enact-
ment of this Act, the amendments made by such sections
shall not apply to plan years beginning before the later
of—
(1) the date on which the last collective bar-
gaining agreements relating to the plan terminates
(determined without regard to any extension thereof
agreed to after the date of enactment of this Act);
or
(2) January 1, 2002.
For purposes of paragraph (1), any plan amendment made
pursuant to a collective bargaining agreement relating to
the plan which amends the plan solely to conform to any
requirement added by an amendment made by this Act
shall not be treated as a termination of such collective bar-
gaining agreement.
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