‘‘(3) 
QUALIFIED
PARTICIPANT.—The 
term 
‘qualified participant’ means a participant (as de-
fined in section 3(7)(B) of the Employee Retirement 
Income Security Act of 1974). 
‘‘(4) PREMIUM.—The term ‘premium’ means 
the applicable premium (as defined in section 
4980B(f)(4)).’’. 
(2) CREDIT ALLOWED AS PART OF GENERAL 
BUSINESS CREDIT.—Section 38(b) of such Code (de-
fining current year business credit) is amended by 
striking ‘‘plus’’ at the end of paragraph (32), by 
striking the period at the end of paragraph (33) and 
inserting ‘‘, plus’’, and by adding at the end the fol-
lowing new paragraph: 
‘‘(34) State coverage buy-in arrangement credit 
determined under section 45Q(a).’’. 
(3) CLERICAL AMENDMENT.—The table of sec-
tions for subpart D of part IV of subchapter A of 
chapter 1 of such Code is amended by adding at the 
end the following new item: 
‘‘Sec. 45Q. Premiums paid under State coverage buy-in arrangements.’’. 
(e) EFFECTIVE DATES.—The amendments made by 
subsections (a), (b), and (c) shall apply with respect to 
arrangements entered into after December 31, 2008. The 
amendments made by subsection (d) shall apply to costs 
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paid or incurred in taxable years beginning after Decem-
ber 31, 2008. 
SEC. 103. EXEMPTION FROM PREEMPTION TO PERMIT PAY 
OR PLAY UNDER STATE LAW. 
Section 514(b) of the Employee Retirement Income 
Security Act of 1974 (as amended by section 201) is 
amended further— 
(1) by redesignating paragraph (10) as para-
graph (11); and 
(2) by inserting after paragraph (9) the fol-
lowing new paragraph: 
‘‘(10) Subsection (a) shall not apply to any provision 
of State law to the extent it provides an assessment 
against an employer, or a credit against an otherwise ap-
plicable assessment against an employer, based on wheth-
er, or the extent to which, such employer makes contribu-
tions to a group health plan established or maintained by 
such employer, if such provision does not condition the ap-
plicability of the assessment or credit on the satisfaction 
of any requirement applicable to such plan.’’. 
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SEC. 104. EXEMPTION FROM PREEMPTION TO PERMIT MAN-
DATES FOR DATA COLLECTION UNDER STATE 
LAW RELATING TO GROUP HEALTH PLANS. 
Section 514(b) of the Employee Retirement Income 
Security Act of 1974 (as amended by the preceding provi-
sions of this title) is amended further— 
(1) by redesignating paragraph (11) as para-
graph (12); and 
(2) by inserting after paragraph (10) the fol-
lowing new paragraph: 
‘‘(10)(A) Subsection (a) shall not apply to any provi-
sion of State law to the extent such provision— 
‘‘(i) provides for the collection from the plan 
sponsor or plan administrator of a group health 
plan, by the agency or instrumentality of the State 
responsible for the administration or enforcement of 
any State law regulating insurance or medical care 
(as defined in section 733(a)(2)), of information re-
lating to the cost and availability of such medical 
care through group health insurance coverage or ac-
cess of individuals to such coverage, or 
‘‘(ii) provides for the enforcement of any State 
law described in clause (i). 
‘‘(B) For purposes of subparagraph (A), any provi-
sion of State law providing for the extent of the informa-
tion described in subparagraph (A)(i) to be collected or 
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the timing allowed for compliance with requests for such 
information shall be treated as a provision of State law 
referred to in subparagraph (A)(i).’’. 
TITLE 
II—HEALTH 
PARTNER-
SHIP 
THROUGH 
CREATIVE 
FEDERALISM 
SEC. 201. SHORT TITLE. 
This title may be cited as the ‘‘Health Partnership 
Through Creative Federalism Act’’. 
SEC. 202. STATE HEALTH REFORM PROJECTS. 
(a) PURPOSES; ESTABLISHMENT OF STATE HEALTH 
CARE EXPANSION AND IMPROVEMENT PROGRAM.— 
(1) PURPOSES.—The purposes of the programs 
approved under this section shall include— 
(A) achieving the goals of increased health 
coverage and access; and 
(B) testing alternative reforms, such as 
building on the public or private health systems, 
or creating new systems, to achieve the objec-
tives of this title. 
(2) INTENT OF CONGRESS.—It is the intent of 
Congress that— 
(A) the programs approved under this title 
each comprise significant coverage expansions; 
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(B) taken as a whole, such programs 
should be diverse and balanced in their ap-
proaches to covering the uninsured; and 
(C) each such program should be rigor-
ously and objectively evaluated, so that the 
State programs developed pursuant to this title 
may guide the development of future State and 
national policy. 
(b) APPLICATIONS BY STATES AND LOCAL GOVERN-
MENTS.— 
(1) ENTITIES THAT MAY APPLY.— 
(A) IN GENERAL.—A State may apply for 
a State health care expansion and improvement 
program for the entire State (or for regions of 
the State) under paragraph (2). 
(B) REGIONAL AND SUB-STATE GROUPS.— 
A regional entity consisting of more than one 
State or one or more local governments within 
a State may apply for a multi-State or a sub- 
State, respectively, health care expansion and 
improvement program for the region or area in-
volved. 
(C) STATE
DEFINED.—In this title, the 
term ‘‘State’’ means the 50 States, the District 
of Columbia, and the Commonwealth of Puerto 
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Rico. Such term shall include a regional entity 
described in subparagraph (B). 
(2) SUBMISSION OF APPLICATION.—In accord-
ance with this section, each State or regional entity 
desiring to implement a State health care expansion 
and improvement program may submit an applica-
tion to the State Health Coverage Innovation Com-
mission under subsection (c) for approval. 
(3) LOCAL
GOVERNMENT
APPLICATIONS.— 
Where a State fails to submit an application under 
this section, a unit of local government of such 
State, or a consortium of such units of local govern-
ments, may submit an application directly to the 
Commission for programs or projects under this sub-
section. Such an application shall be subject to the 
requirements of this section. 
(c) STATE HEALTH COVERAGE INNOVATION COM-
MISSION.— 
(1) IN GENERAL.—Not later than 90 days after 
the date of the enactment of this Act, the Secretary 
of Health and Human Services (in this section re-
ferred to as the ‘‘Secretary’’) shall establish a State 
Health Coverage Innovation Commission (referred to 
in this section as the ‘‘Commission’’). 
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(I) Two individuals to be appointed by the 
minority leader of the Senate. 
(3) DUTIES.—The Commission— 
(A) shall request States to submit pro-
posals, which may include a variety of reform 
options such as tax credit approaches, expan-
sions of public programs such as Medicaid and 
the State Children’s Health Insurance Pro-
gram, the creation of purchasing pooling ar-
rangements similar to the Federal Employees 
Health Benefits Program, individual market 
purchasing options, single risk pool or single 
payer systems, health savings accounts, a com-
bination of the options described in this sub-
paragraph, or other alternatives determined ap-
propriate by the Commission, including options 
suggested by States or the public, and nothing 
in this subparagraph shall be construed to pre-
vent the Commission from approving a reform 
proposal not included in this subparagraph; 
(B) shall conduct a thorough review of the 
grant application from a State and carry on a 
dialogue with all State applicants concerning 
possible modifications and adjustments; 
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(C) shall submit the recommendations and 
legislative proposal described in subsection 
(d)(4)(C); 
(D) shall be responsible for receiving infor-
mation to determine the status and progress 
achieved under the program or projects granted 
under this section; 
(E) shall report to the public concerning 
progress made by States with respect to the 
performance measures and goals established 
under this title, the periodic progress of the 
State relative to its State performance meas-
ures and goals, and the State program applica-
tion procedures, by region and State jurisdic-
tion; 
(F) shall promote information exchange 
between States and the Federal Government; 
(G) shall be responsible for making rec-
ommendations to the Secretary and the Con-
gress, using equivalency or minimum standards, 
for minimizing the negative effect of State pro-
gram on national employer groups, provider or-
ganizations, and insurers because of differing 
State requirements under the programs; and 
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(H) may require States to submit addi-
tional information or reports concerning the 
status and progress achieved under health care 
expansion and improvement programs granted 
under this section, as needed. 
(4) PERIOD
OF
APPOINTMENT; REPRESENTA-
TION
REQUIREMENTS; VACANCIES.—Members shall 
be appointed for a term of 5 years. In appointing 
such members under paragraph (2), the designated 
appointing individuals shall ensure the representa-
tion of urban and rural areas and an appropriate ge-
ographic distribution of such members. Any vacancy 
in the Commission shall not affect its powers, but 
shall be filled in the same manner as the original ap-
pointment. 
(5) CHAIRPERSON, MEETINGS.— 
(A) CHAIRPERSON.—The Commission shall 
select a Chairperson from among its members. 
(B) QUORUM.—Two-thirds of the members 
of the Commission shall constitute a quorum, 
but a lesser number of members may hold hear-
ings. 
(C) MEETINGS.—Not later than 30 days 
after the date on which all members of the 
Commission have been appointed, the Commis-
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sion shall hold its first meeting. The Commis-
sion shall meet at the call of the Chairperson. 
(6) POWERS OF THE COMMISSION.— 
(A) NEGOTIATIONS
WITH
STATES.—The 
Commission may conduct detailed discussions 
and negotiations with States submitting appli-
cations under this section, either individually or 
in groups, to facilitate a final set of rec-
ommendations 
for 
purposes 
of 
subsection 
(d)(4)(C). 
(B) HEARINGS.—The Commission may 
hold such hearings, sit and act at such times 
and places, take such testimony, and receive 
such evidence as the Commission considers ad-
visable to carry out the purposes of this sub-
section. 
(C) MEETINGS.—In addition to other 
meetings the Commission may hold, the Com-
mission shall hold an annual meeting with the 
participating States under this section for the 
purpose of having States report progress to-
ward the purposes in subsection (a) and for an 
exchange of information. 
(D) INFORMATION.—The Commission may 
secure directly from any Federal department or 
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agency such information as the Commission 
considers necessary to carry out the provisions 
of this subsection. Upon request of the Chair-
person of the Commission, the head of such de-
partment or agency shall furnish such informa-
tion to the Commission if the head of the de-
partment or agency involved determines it ap-
propriate. 
(E) POSTAL SERVICES.—The Commission 
may use the United States mails in the same 
manner and under the same conditions as other 
departments and agencies of the Federal Gov-
ernment. 
(7) PERSONNEL MATTERS.— 
(A) COMPENSATION.—Each member of the 
Commission who is not an officer or employee 
of the Federal Government or of a State or 
local government shall be compensated at a rate 
equal to the daily equivalent of the annual rate 
of basic pay prescribed for level IV of the Exec-
utive Schedule under section 5315 of title 5, 
United States Code, for each day (including 
travel time) during which such member is en-
gaged in the performance of the duties of the 
Commission. All members of the Commission 
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who are officers or employees of the United 
States shall serve without compensation in addi-
tion to that received for their services as offi-
cers or employees of the United States. 
(B) TRAVEL EXPENSES.—The members of 
the Commission shall be allowed travel ex-
penses, including per diem in lieu of subsist-
ence, at rates authorized for employees of agen-
cies under subchapter I of chapter 57 of title 5, 
United States Code, while away from their 
homes or regular places of business in the per-
formance of services for the Commission. 
(C) STAFF.—The Chairperson of the Com-
mission may, without regard to the civil service 
laws and regulations, appoint and terminate an 
executive director and such other additional 
personnel as may be necessary to enable the 
Commission to perform its duties. The employ-
ment of an executive director shall be subject to 
confirmation by the Commission. 
(D) DETAIL
OF
GOVERNMENT
EMPLOY-
EES.—Any Federal Government employee may 
be detailed to the Commission without reim-
bursement, and such detail shall be without 
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interruption or loss of civil service status or 
privilege. 
(E) 
TEMPORARY
AND
INTERMITTENT 
SERVICES.—The Chairperson of the Commis-
sion may procure temporary and intermittent 
services under section 3109(b) of title 5, United 
States Code, at rates for individuals which do 
not exceed the daily equivalent of the annual 
rate of basic pay prescribed for level V of the 
Executive Schedule under section 5316 of such 
title. 
(8) FUNDING.—For the purpose of carrying out 
this subsection, there are authorized to be appro-
priated $3,000,000 for fiscal year 2009 and each fis-
cal year thereafter. 
(d) REQUIREMENTS FOR PROGRAMS.— 
(1) STATE PLAN.—A State that seeks to oper-
ate a program under this section shall prepare and 
submit to the Commission, as part of the application 
under subsection (b)(2), a State plan that shall have 
as its goal increased health care coverage, and in 
service of that goal such additional goals as improve-
ments in health care quality, efficiency, cost-effec-
tiveness, and the appropriate use of information 
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technology. To achieve such goal, the State plan 
shall comply with the following: 
(A) COVERAGE.— 
(i) IN
GENERAL.—With respect to 
coverage, the State plan shall— 
(I) provide and describe the man-
ner in which the State will ensure that 
an increased number of individuals re-
siding within the State will have ex-
panded access to health care coverage 
with a specific 5-year target for reduc-
tion in the number or proportion of 
uninsured individuals through either 
private or public program expansion, 
or both, in accordance with or in addi-
tion to the options established by the 
Commission; 
(II) describe the number and per-
centage of current uninsured individ-
uals who will achieve coverage under a 
State health program; 
(III) describe the coverage that 
will be provided to beneficiaries under 
a State health program; 
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(IV) identify Federal, State, or 
local and private programs that cur-
rently provide health care services in 
the State and describe how such pro-
grams could be coordinated with a 
State health program, to the extent 
practicable; and 
(V) provide for improvements in 
the availability of appropriate health 
care coverage that will increase access 
to care in urban, suburban, rural, and 
frontier areas of the State with medi-
cally 
underserved 
populations 
or 
where there may be an inadequate 
supply of health care providers. 
(ii) COVERAGE
OPTIONS.—The cov-
erage under the State plan may be— 
(I) health insurance coverage 
that meets the aggregate actuarial 
value 
requirement 
of 
section 
2103(a)(2)(B) of the Social Security 
Act (42 U.S.C. 1397cc(a)(2)(B)); 
(II) a combination of health in-
surance coverage and a consumer-di-
rected health care spending account, if 
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the actuarial value of such coverage 
plus the amount of annual deposits 
into such account from sources other 
than the beneficiary is not less than 
the actuarial value amount described 
in subclause (I); or 
(III) health care access not less 
on 
average 
than 
that 
provided 
through coverage described in sub-
clause (I). 
(iii) CONSTRUCTION.—Nothing in this 
clause shall be construed to limit in any 
way the authority of the Secretary of 
Health and Human Services to issue waiv-
ers under section 1115 of the Social Secu-
rity Act. 
(B) QUALITY.—With respect to quality, 
the State plan may describe efforts to improve 
health care quality in the State, including an 
explanation of how such efforts would change 
(if at all) under the State plan. 
(C) COSTS.—With respect to costs, the 
State plan shall— 
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(i) describe such steps as the State 
may undertake to improve the efficiency of 
health care; 
(ii) describe the public and private 
sector financing to be provided for the 
State health program; 
(iii) estimate the amount of Federal, 
State, and local expenditures, as well as, 
the costs to business and individuals under 
the State health program; and 
(iv) describe how the State plan will 
ensure the financial solvency of the State 
health program. 
(D) 
HEALTH
INFORMATION
TECH-
NOLOGY.—With respect to health information 
technology, the State plan may describe efforts 
to improve the appropriate use of health infor-
mation technology, including an explanation of 
how such efforts would change (if at all) under 
the State plan. 
(E) EXCEPTIONS TO FEDERAL POLICIES.— 
(i) IN
GENERAL.—Subject to clause 
(ii), the State plan shall describe the ex-
ceptions to otherwise applicable Federal 
statutes, regulations, and policies that 
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would apply within the geographic area 
and time period governed by the plan. 
(ii) RECOGNITION OF ERISA REQUIRE-
MENTS.—Except to the extent authorized 
under subsection (j)(4), the State plan 
may not include exceptions to the provi-
sions of the Employee Retirement Income 
Security Act of 1974 but may take into ac-
count the amendments made by title I of 
this Act. 
(2) TECHNICAL
ASSISTANCE.—The Secretary 
shall, if requested, provide technical assistance to 
States to assist such States in developing applica-
tions and plans under this section, including tech-
nical assistance by private sector entities if deter-
mined appropriate by the Commission. 
(3) INITIAL REVIEW.—With respect to a State 
application under subsection (b)(2), the Secretary 
and the Commission shall complete an initial review 
of such State application not later than 60 days 
after the receipt of such application, analyze the 
scope of the proposal, and determine whether addi-
tional information is needed from the State. The 
Commission shall advise the State within such pe-
riod of the need to submit additional information. 
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(4) FINAL DETERMINATION.— 
(A) IN
GENERAL.—In a timely manner 
consistent with subparagraph (C), the Commis-
sion shall determine whether to submit a State 
proposal to Congress for approval. 
(B) VOTING.— 
(i) IN GENERAL.—The determination 
to submit a State proposal to Congress 
under subparagraph (A) shall be approved 
by 2⁄3 of the members of the Commission 
who are present and eligible to vote and a 
majority of the entire Commission. 
(ii) ELIGIBILITY.—A member of the 
Commission shall not participate in a de-
termination under subparagraph (A) if— 
(I) in the case of a member who 
is a Governor, such determination re-
lates to the State of which the mem-
ber is the Governor; or 
(II) in the case of member not 
described in subclause (I), such deter-
mination relates to the geographic 
area of a State of which such member 
serves as a State or local official or as 
a Member of Congress. 
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(C) SUBMISSION.—Not later than 90 days 
before October 1 of each fiscal year, the Com-
mission may submit to Congress a list, in the 
form of a legislative proposal, of the State ap-
plications that the Commission recommends for 
approval under this section. 
(5) PROGRAM OR PROJECT PERIOD.—A State 
program or project may be approved for a period of 
5 years and may be extended for a subsequent pe-
riod of time upon approval by the Commission, 
based upon achievement of targets. 
(e) EXPEDITED CONGRESSIONAL CONSIDERATION.— 
(1) INTRODUCTION AND EXPEDITED CONSIDER-
ATION IN THE HOUSE OF REPRESENTATIVES.— 
(A) INTRODUCTION
IN
HOUSE
OF
REP-
RESENTATIVES.—The legislative proposal sub-
mitted pursuant to subsection (d)(4)(C) shall be 
in the form of a joint resolution (in this sub-
section referred to as the ‘‘resolution’’). Such 
resolution shall be introduced in the House of 
Representatives by the Speaker immediately 
upon receipt of the language and shall be re-
ferred non-sequentially to the appropriate com-
mittee (or committees) of House of Representa-
tives. If the resolution is not introduced in ac-
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cordance with the preceding sentence, the reso-
lution may be introduced by any member of the 
House of Representatives. 
(B) COMMITTEE
CONSIDERATION.—Not 
later than 15 calendar days after the introduc-
tion of the resolution described in subparagraph 
(A), each committee of the House of Represent-
atives to which the resolution was referred shall 
report the resolution. The report may include, 
at the committee’s discretion, a recommenda-
tion for action by the House. If a committee 
has not reported such resolution (or an iden-
tical resolution) at the end of 15 calendar days 
after its introduction or at the end of the first 
day after there has been reported to the House 
a resolution, whichever is earlier, such com-
mittee shall be deemed to be discharged from 
further consideration of such resolution and 
such resolution shall be placed on the appro-
priate calendar of the House of Representatives. 
(C) EXPEDITED PROCEDURE IN HOUSE.— 
Not later than 5 legislative days after the date 
on which all committees have been discharged 
from consideration of a resolution, the Speaker 
of the House of Representatives, or the Speak-
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er’s designee, shall move to proceed to the con-
sideration of the resolution. It shall also be in 
order for any member of the House of Rep-
resentatives to move to proceed to the consider-
ation of the resolution at any time after the 
conclusion of such 5-day period. All points of 
order against the resolution (and against con-
sideration of the resolution) are waived. A mo-
tion to proceed to the consideration of the reso-
lution is highly privileged in the House of Rep-
resentatives and is not debatable. The motion is 
not subject to amendment, to a motion to post-
pone consideration of the resolution, or to a mo-
tion to proceed to the consideration of other 
business. A motion to reconsider the vote by 
which the motion to proceed is agreed to or not 
agreed to shall not be in order. If the motion 
to proceed is agreed to, the House of Rep-
resentatives shall immediately proceed to con-
sideration of the resolution without intervening 
motion, order, or other business, and the reso-
lution shall remain the unfinished business of 
the House of Representatives until disposed of. 
A motion to recommit the resolution shall not 
be in order. Upon its passage in the House, the 
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clerk of the House shall provide for its imme-
diate transmittal to the Senate. 
(2) EXPEDITED CONSIDERATION IN THE SEN-
ATE.— 
(A) REFERRAL
TO
COMMITTEE.—If the 
resolution is agreed to by the House of Rep-
resentatives, upon its receipt in the Senate the 
majority leader of the Senate, or the leader’s 
designee, the resolution shall be referred to the 
appropriate committee of Senate. 
(B) COMMITTEE
CONSIDERATION.—Not 
later than 15 calendar days after the referral of 
the resolution under subparagraph (A), the 
committee of the Senate to which the resolution 
was referred shall report the resolution. The re-
port may include, at the committee’s discretion, 
a recommendation for action by the Senate. If 
a committee has not reported such resolution 
(or an identical resolution) at the end of 15 cal-
endar days after its referral or at the end of the 
first day after there has been reported to the 
Senate a resolution, whichever is earlier, such 
committee shall be deemed to be discharged 
from further consideration of such resolution 
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and such resolution shall be placed on the ap-
propriate calendar of the Senate. 
(C) EXPEDITED FLOOR CONSIDERATION.— 
Not later than 5 legislative days after the date 
on which all committees have been discharged 
from consideration of a resolution, the majority 
leader of the Senate, or the majority leader’s 
designee, shall move to proceed to the consider-
ation of the resolution. It shall also be in order 
for any member of the Senate to move to pro-
ceed to the consideration of the resolution at 
any time after the conclusion of such 5-day pe-
riod. All points of order against the resolution 
(and against consideration of the resolution) 
are waived. A motion to proceed to the consid-
eration of the resolution in the Senate is privi-
leged and is not debatable. The motion is not 
subject to amendment, to a motion to postpone 
consideration of the resolution, or to a motion 
to proceed to the consideration of other busi-
ness. A motion to reconsider the vote by which 
the motion to proceed is agreed to or not 
agreed to shall not be in order. If the motion 
to proceed is agreed to, the Senate shall imme-
diately proceed to consideration of the resolu-
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