187 
provision of this title, except by specific cross-reference to 
the affected section.’’. 
(c) PLAN SPONSOR.—Section 3(16)(B) of such Act 
(29 U.S.C. 102(16)(B)) is amended by adding at the end 
the following new sentence: ‘‘Such term also includes a 
person serving as the sponsor of an association health plan 
under part 8.’’. 
(d) DISCLOSURE OF SOLVENCY PROTECTIONS RE-
LATED TO SELF-INSURED AND FULLY INSURED OPTIONS 
UNDER ASSOCIATION HEALTH PLANS.—Section 102(b) 
of such Act (29 U.S.C. 102(b)) is amended by adding at 
the end the following: ‘‘An association health plan shall 
include in its summary plan description, in connection 
with each benefit option, a description of the form of sol-
vency or guarantee fund protection secured pursuant to 
this Act or applicable State law, if any.’’. 
(e) SAVINGS CLAUSE.—Section 731(c) of such Act is 
amended by inserting ‘‘or part 8’’ after ‘‘this part’’. 
(f) REPORT TO THE CONGRESS REGARDING CERTIFI-
CATION
OF
SELF-INSURED
ASSOCIATION
HEALTH 
PLANS.—Not later than January 1, 2016, the Secretary 
of Labor shall report to the Committee on Education and 
the Workforce of the House of Representatives and the 
Committee on Health, Education, Labor, and Pensions of 
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the Senate the effect association health plans have had, 
if any, on reducing the number of uninsured individuals. 
(g) CLERICAL AMENDMENT.—The table of contents 
in section 1 of the Employee Retirement Income Security 
Act of 1974 is amended by inserting after the item relat-
ing to section 734 the following new items: 
‘‘PART 8—RULES GOVERNING ASSOCIATION HEALTH PLANS 
‘‘801. Association health plans. 
‘‘802. Certification of association health plans. 
‘‘803. Requirements relating to sponsors and boards of trustees. 
‘‘804. Participation and coverage requirements. 
‘‘805. Other requirements relating to plan documents, contribution rates, and 
benefit options. 
‘‘806. Maintenance of reserves and provisions for solvency for plans providing 
health benefits in addition to health insurance coverage. 
‘‘807. Requirements for application and related requirements. 
‘‘808. Notice requirements for voluntary termination. 
‘‘809. Corrective actions and mandatory termination. 
‘‘810. Trusteeship by the Secretary of insolvent association health plans pro-
viding health benefits in addition to health insurance coverage. 
‘‘811. State assessment authority. 
‘‘812. Definitions and rules of construction.’’. 
SEC. 622. CLARIFICATION OF TREATMENT OF SINGLE EM-
PLOYER ARRANGEMENTS. 
Section 3(40)(B) of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1002(40)(B)) is amend-
ed— 
(1) in clause (i), by inserting after ‘‘control 
group,’’ the following: ‘‘except that, in any case in 
which the benefit referred to in subparagraph (A) 
consists of medical care (as defined in section 
812(a)(2)), two or more trades or businesses, wheth-
er or not incorporated, shall be deemed a single em-
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189 
ployer for any plan year of such plan, or any fiscal 
year of such other arrangement, if such trades or 
businesses are within the same control group during 
such year or at any time during the preceding 1-year 
period,’’; 
(2) in clause (iii), by striking ‘‘(iii) the deter-
mination’’ and inserting the following: 
‘‘(iii)(I) in any case in which the benefit re-
ferred to in subparagraph (A) consists of medical 
care (as defined in section 812(a)(2)), the deter-
mination of whether a trade or business is under 
‘common control’ with another trade or business 
shall be determined under regulations of the Sec-
retary applying principles consistent and coextensive 
with the principles applied in determining whether 
employees of two or more trades or businesses are 
treated as employed by a single employer under sec-
tion 4001(b), except that, for purposes of this para-
graph, an interest of greater than 25 percent may 
not be required as the minimum interest necessary 
for common control, or 
‘‘(II) in any other case, the determination’’; 
(3) by redesignating clauses (iv) and (v) as 
clauses (v) and (vi), respectively; and 
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190 
(4) by inserting after clause (iii) the following 
new clause: 
‘‘(iv) in any case in which the benefit referred 
to in subparagraph (A) consists of medical care (as 
defined in section 812(a)(2)), in determining, after 
the application of clause (i), whether benefits are 
provided to employees of two or more employers, the 
arrangement shall be treated as having only one par-
ticipating employer if, after the application of clause 
(i), the number of individuals who are employees and 
former employees of any one participating employer 
and who are covered under the arrangement is 
greater than 75 percent of the aggregate number of 
all individuals who are employees or former employ-
ees of participating employers and who are covered 
under the arrangement,’’. 
SEC. 623. ENFORCEMENT PROVISIONS RELATING TO ASSO-
CIATION HEALTH PLANS. 
(a) CRIMINAL PENALTIES FOR CERTAIN WILLFUL 
MISREPRESENTATIONS.—Section 501 of the Employee 
Retirement Income Security Act of 1974 (29 U.S.C. 1131) 
is amended— 
(1) by inserting ‘‘(a)’’ after ‘‘Sec. 501.’’; and 
(2) by adding at the end the following new sub-
section: 
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191 
‘‘(b) Any person who willfully falsely represents, to 
any employee, any employee’s beneficiary, any employer, 
the Secretary, or any State, a plan or other arrangement 
established or maintained for the purpose of offering or 
providing any benefit described in section 3(1) to employ-
ees or their beneficiaries as— 
‘‘(1) being an association health plan which has 
been certified under part 8; 
‘‘(2) having been established or maintained 
under or pursuant to one or more collective bar-
gaining agreements which are reached pursuant to 
collective bargaining described in section 8(d) of the 
National Labor Relations Act (29 U.S.C. 158(d)) or 
paragraph fourth of section 2 of the Railway Labor 
Act (45 U.S.C. 152, paragraph fourth) or which are 
reached pursuant to labor-management negotiations 
under similar provisions of State public employee re-
lations laws; or 
‘‘(3) being a plan or arrangement described in 
section 3(40)(A)(i), 
shall, upon conviction, be imprisoned not more than 5 
years, be fined under title 18, United States Code, or 
both.’’. 
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192 
(b) CEASE ACTIVITIES ORDERS.—Section 502 of 
such Act (29 U.S.C. 1132) is amended by adding at the 
end the following new subsection: 
‘‘(n) ASSOCIATION HEALTH PLAN CEASE AND DE-
SIST ORDERS.— 
‘‘(1) IN GENERAL.—Subject to paragraph (2), 
upon application by the Secretary showing the oper-
ation, promotion, or marketing of an association 
health plan (or similar arrangement providing bene-
fits consisting of medical care (as defined in section 
733(a)(2))) that— 
‘‘(A) is not certified under part 8, is sub-
ject under section 514(b)(6) to the insurance 
laws of any State in which the plan or arrange-
ment offers or provides benefits, and is not li-
censed, registered, or otherwise approved under 
the insurance laws of such State; or 
‘‘(B) is an association health plan certified 
under part 8 and is not operating in accordance 
with the requirements under part 8 for such 
certification, 
a district court of the United States shall enter an 
order requiring that the plan or arrangement cease 
activities. 
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193 
‘‘(2) EXCEPTION.—Paragraph (1) shall not 
apply in the case of an association health plan or 
other arrangement if the plan or arrangement shows 
that— 
‘‘(A) all benefits under it referred to in 
paragraph (1) consist of health insurance cov-
erage; and 
‘‘(B) with respect to each State in which 
the plan or arrangement offers or provides ben-
efits, the plan or arrangement is operating in 
accordance with applicable State laws that are 
not superseded under section 514. 
‘‘(3) ADDITIONAL
EQUITABLE
RELIEF.—The 
court may grant such additional equitable relief, in-
cluding any relief available under this title, as it 
deems necessary to protect the interests of the pub-
lic and of persons having claims for benefits against 
the plan.’’. 
(c) RESPONSIBILITY
FOR CLAIMS PROCEDURE.— 
Section 503 of such Act (29 U.S.C. 1133) is amended by 
inserting ‘‘(a) IN GENERAL.—’’ before ‘‘In accordance’’, 
and by adding at the end the following new subsection: 
‘‘(b) ASSOCIATION HEALTH PLANS.—The terms of 
each association health plan which is or has been certified 
under part 8 shall require the board of trustees or the 
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194 
named fiduciary (as applicable) to ensure that the require-
ments of this section are met in connection with claims 
filed under the plan.’’. 
SEC. 624. COOPERATION BETWEEN FEDERAL AND STATE 
AUTHORITIES. 
Section 506 of the Employee Retirement Income Se-
curity Act of 1974 (29 U.S.C. 1136) is amended by adding 
at the end the following new subsection: 
‘‘(d) CONSULTATION WITH STATES WITH RESPECT 
TO ASSOCIATION HEALTH PLANS.— 
‘‘(1) AGREEMENTS
WITH
STATES.—The Sec-
retary shall consult with the State recognized under 
paragraph (2) with respect to an association health 
plan regarding the exercise of— 
‘‘(A) the Secretary’s authority under sec-
tions 502 and 504 to enforce the requirements 
for certification under part 8; and 
‘‘(B) the Secretary’s authority to certify 
association health plans under part 8 in accord-
ance with regulations of the Secretary applica-
ble to certification under part 8. 
‘‘(2) RECOGNITION
OF
PRIMARY
DOMICILE 
STATE.—In carrying out paragraph (1), the Sec-
retary shall ensure that only one State will be recog-
nized, with respect to any particular association 
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health plan, as the State with which consultation is 
required. In carrying out this paragraph— 
‘‘(A) in the case of a plan which provides 
health insurance coverage (as defined in section 
812(a)(3)), such State shall be the State with 
which filing and approval of a policy type of-
fered by the plan was initially obtained, and 
‘‘(B) in any other case, the Secretary shall 
take into account the places of residence of the 
participants and beneficiaries under the plan 
and the State in which the trust is main-
tained.’’. 
SEC. 625. EFFECTIVE DATE AND TRANSITIONAL AND 
OTHER RULES. 
(a) EFFECTIVE DATE.—The amendments made by 
this chapter shall take effect 1 year after the date of the 
enactment of this Act. The Secretary of Labor shall first 
issue all regulations necessary to carry out the amend-
ments made by this chapter within 1 year after the date 
of the enactment of this Act. 
(b) TREATMENT
OF CERTAIN EXISTING HEALTH 
BENEFITS PROGRAMS.— 
(1) IN GENERAL.—In any case in which, as of 
the date of the enactment of this Act, an arrange-
ment is maintained in a State for the purpose of 
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196 
providing benefits consisting of medical care for the 
employees and beneficiaries of its participating em-
ployers, at least 200 participating employers make 
contributions to such arrangement, such arrange-
ment has been in existence for at least 10 years, and 
such arrangement is licensed under the laws of one 
or more States to provide such benefits to its par-
ticipating employers, upon the filing with the appli-
cable authority (as defined in section 812(a)(5) of 
the Employee Retirement Income Security Act of 
1974 (as amended by this chapter)) by the arrange-
ment of an application for certification of the ar-
rangement under part 8 of subtitle B of title I of 
such Act— 
(A) such arrangement shall be deemed to 
be a group health plan for purposes of title I 
of such Act; 
(B) the requirements of sections 801(a) 
and 803(a) of the Employee Retirement Income 
Security Act of 1974 shall be deemed met with 
respect to such arrangement; 
(C) the requirements of section 803(b) of 
such Act shall be deemed met, if the arrange-
ment is operated by a board of directors 
which— 
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197 
(i) is elected by the participating em-
ployers, with each employer having one 
vote; and 
(ii) has complete fiscal control over 
the arrangement and which is responsible 
for all operations of the arrangement; 
(D) the requirements of section 804(a) of 
such Act shall be deemed met with respect to 
such arrangement; and 
(E) the arrangement may be certified by 
any applicable authority with respect to its op-
erations in any State only if it operates in such 
State on the date of certification. 
The provisions of this subsection shall cease to apply 
with respect to any such arrangement at such time 
after the date of the enactment of this Act as the 
applicable requirements of this subsection are not 
met with respect to such arrangement. 
(2) DEFINITIONS.—For purposes of this sub-
section, the terms ‘‘group health plan’’, ‘‘medical 
care’’, and ‘‘participating employer’’ shall have the 
meanings provided in section 812 of the Employee 
Retirement Income Security Act of 1974, except 
that the reference in paragraph (7) of such section 
to an ‘‘association health plan’’ shall be deemed a 
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reference to an arrangement referred to in this sub-
section. 
CHAPTER 2—TARGETED EFFORTS TO 
EXPAND ACCESS 
SEC. 631. EXTENDING COVERAGE OF DEPENDENTS. 
(a) EMPLOYEE RETIREMENT INCOME SECURITY ACT 
OF 1974.— 
(1) IN GENERAL.—Part 7 of subtitle B of title 
I of the Employee Retirement Income Security Act 
of 1974 is amended by inserting after section 714 
the following new section: 
‘‘SEC. 715. EXTENDING COVERAGE OF DEPENDENTS. 
‘‘(a) IN GENERAL.—In the case of a group health 
plan, or health insurance coverage offered in connection 
with a group health plan, that treats as a beneficiary 
under the plan an individual who is a dependent child of 
a participant or beneficiary under the plan, the plan or 
coverage shall continue to treat the individual as a depend-
ent child without regard to the individual’s age through 
at least the end of the plan year in which the individual 
turns an age specified in the plan, but not less than 23 
years of age. 
‘‘(b) CONSTRUCTION.—Nothing in this section shall 
be construed as requiring a group health plan to provide 
benefits for dependent children as beneficiaries under the 
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199 
plan or to require a participant to elect coverage of de-
pendent children.’’. 
(2) CLERICAL AMENDMENT.—The table of con-
tents of such Act is amended by inserting after the 
item relating to section 714 the following new item: 
‘‘Sec. 715. Extending coverage of dependents.’’. 
(b) PHSA.—Title XXVII of the Public Health Serv-
ice Act is amended by inserting after section 2707 the fol-
lowing new section: 
‘‘SEC. 2708. EXTENDING COVERAGE OF DEPENDENTS. 
‘‘(a) IN GENERAL.—In the case of a group health 
plan, or health insurance coverage offered in connection 
with a group health plan, that treats as a beneficiary 
under the plan an individual who is a dependent child of 
a participant or beneficiary under the plan, the plan or 
coverage shall continue to treat the individual as a depend-
ent child without regard to the individual’s age through 
at least the end of the plan year in which the individual 
turns an age specified in the plan, but not less than 23 
years of age. 
‘‘(b) CONSTRUCTION.—Nothing in this section shall 
be construed as requiring a group health plan to provide 
benefits for dependent children as beneficiaries under the 
plan or to require a participant to elect coverage of de-
pendent children.’’. 
(c) IRC.— 
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200 
(1) IN
GENERAL.—Subchapter B of chapter 
100 of the Internal Revenue Code of 1986 is amend-
ed by adding at the end the following new section: 
‘‘SEC. 9814. EXTENDING COVERAGE OF DEPENDENTS. 
‘‘(a) IN GENERAL.—In the case of a group health 
plan that treats as a beneficiary under the plan an indi-
vidual who is a dependent child of a participant or bene-
ficiary under the plan, the plan shall continue to treat the 
individual as a dependent child without regard to the indi-
vidual’s age through at least the end of the plan year in 
which the individual turns an age specified in the plan, 
but not less than 23 years of age. 
‘‘(b) CONSTRUCTION.—Nothing in this section shall 
be construed as requiring a group health plan to provide 
coverage for dependent children as beneficiaries under the 
plan or to require a participant to elect coverage of de-
pendent children.’’. 
(2) CLERICAL AMENDMENT.—The table of sec-
tions in such subchapter is amended by adding at 
the end the following new item: 
‘‘Sec. 9814. Extending coverage of dependents.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to group health plans for plan 
years beginning more than 3 months after the date of the 
enactment of this Act and shall apply to individuals who 
are dependent children under a group health plan, or 
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201 
health insurance coverage offered in connection with such 
a plan, on or after such date. 
SEC. 632. ALLOWING AUTO-ENROLLMENT FOR EMPLOYER 
SPONSORED COVERAGE. 
(a) IN GENERAL.—No State shall establish a law 
that prevents an employer from instituting auto-enroll-
ment for coverage of a participant or beneficiary, including 
current employees, under a group health plan, or health 
insurance coverage offered in connection with such a plan, 
so long as the participant or beneficiary has the option 
of declining such coverage. 
(b) AUTO-ENROLLMENT.— 
(1) NOTICE REQUIRED.—Employers with auto- 
enrollment under a group health plan or health in-
surance coverage shall provide annual notification, 
within a reasonable period before the beginning of 
each plan year, to each employee eligible to partici-
pate in the plan. The notice shall explain the em-
ployee contribution to such plan and the employee’s 
right to decline coverage. 
(2) TREATMENT OF NON-ACTION.—After a rea-
sonable period of time after receipt of the notice, if 
an employee fails to make an affirmative declaration 
declining coverage, then such an employee may be 
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enrolled in the group health plan or health insurance 
coverage offered in connection with such a plan.’’. 
(c) CONSTRUCTION.—Nothing in this section shall be 
construed to supersede State law which establishes, imple-
ments, or continues in effect any standard or requirement 
relating to employers in connection with payroll or the 
sponsoring of employer sponsored health insurance cov-
erage except to the extent that such standard or require-
ment prevents an employer from instituting the auto-en-
rollment described in subsection (a). 
TITLE 
VII—STOPPING 
MEDI-
CARE, WASTE, FRAUD, AND 
ABUSE AND INCREASING PEN-
ALTIES FOR ABUSERS 
SEC. 701. INCREASED CIVIL MONEY PENALTIES AND CRIMI-
NAL FINES FOR MEDICARE FRAUD AND 
ABUSE. 
(a) INCREASED CIVIL MONEY PENALTIES.—Section 
1128A of the Social Security Act (42 U.S.C. 1320a–7a) 
is amended— 
(1) in subsection (a), in the matter following 
paragraph (10)— 
(A) by striking ‘‘$10,000’’ each place it 
appears and inserting ‘‘$20,000’’; 
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