quired by individuals under 22 years of age who 
have a serious emotional disturbance or a sub-
stance abuse disorder. 
(F) The system provides for the manage-
ment of the individualized treatment plans de-
scribed in subparagraph (D) and for a flexible 
response to changes in treatment needs over 
time. 
(c) TREATMENT OF EXPERIMENTAL SERVICES.—In 
applying subsection (a), the Board shall make national 
coverage determinations with respect to those services that 
are experimental in nature. Such determinations shall be 
made consistent with a process that provides for input 
from representatives of health care professionals and pa-
tients and public comment. 
(d) APPLICATION
OF PRACTICE GUIDELINES.—In 
the case of services for which the American Health Secu-
rity Quality Council (established under section 501) has 
recognized a national practice guideline, the services are 
considered to meet the standards specified in section 
201(a) if they have been provided in accordance with such 
guideline or in accordance with such guidelines as are pro-
vided by the State health security program consistent with 
title V. For purposes of this subsection, a service shall 
be considered to have been provided in accordance with 
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a practice guideline if the health care provider providing 
the service exercised appropriate professional discretion to 
deviate from the guideline in a manner authorized or an-
ticipated by the guideline. 
(e) SPECIFIC LIMITATIONS.— 
(1) LIMITATIONS
ON
EYEGLASSES, CONTACT 
LENSES, HEARING
AIDS, AND
DURABLE
MEDICAL 
EQUIPMENT.—Subject to section 201(d), the Board 
may impose such limits relating to the costs and fre-
quency of replacement of eyeglasses, contact lenses, 
hearing aids, and durable medical equipment to 
which individuals enrolled for benefits under this Act 
are entitled to have payment made under a State 
health security program as the Board deems appro-
priate. 
(2) OVERLAP WITH PREVENTIVE SERVICES.— 
The coverage of services described in section 201(a) 
(other than paragraph (3)) which also are preventive 
services are required to be covered only to the extent 
that they are required to be covered as preventive 
services. 
(3) MISCELLANEOUS EXCLUSIONS FROM COV-
ERED SERVICES.—Covered services under this Act 
do not include the following: 
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(A) Surgery and other procedures (such as 
orthodontia) performed solely for cosmetic pur-
poses (as defined in regulations) and hospital or 
other services incident thereto, unless— 
(i) required to correct a congenital 
anomaly; 
(ii) required to restore or correct a 
part of the body which has been altered as 
a result of accidental injury, disease, or 
surgery; or 
(iii) otherwise determined to be medi-
cally necessary and appropriate under sec-
tion 201(a). 
(B) Personal comfort items or private 
rooms in inpatient facilities, unless determined 
to be medically necessary and appropriate 
under section 201(a). 
(C) The services of a professional practi-
tioner if they are furnished in a hospital or 
other facility which is not a participating pro-
vider. 
(f) NURSING
FACILITY
SERVICES
AND
HOME 
HEALTH SERVICES.—Nursing facility services and home 
health services (other than post-hospital services, as de-
fined by the Board) furnished to an individual who is not 
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described in section 203(a) are not covered services unless 
the services are determined to meet the standards speci-
fied in section 201(a) and, with respect to nursing facility 
services, to be provided in the least restrictive and most 
appropriate setting. 
SEC. 205. CERTIFICATION; QUALITY REVIEW; PLANS OF 
CARE. 
(a) CERTIFICATIONS.—State health security pro-
grams may require, as a condition of payment for institu-
tional health care services and other services of the type 
described in such sections 1814(a) and 1835(a) of the So-
cial Security Act, periodic professional certifications of the 
kind described in such sections. 
(b) QUALITY REVIEW.—For the requirement that 
each State health security program establish a quality re-
view program that meets the requirements for such a pro-
gram under title V, see section 404(b)(1)(H). 
(c) PLAN OF CARE REQUIREMENTS.—A State health 
security program may require, consistent with standards 
established by the Board, that payment for services ex-
ceeding specified levels or duration be provided only as 
consistent with a plan of care or treatment formulated by 
one or more providers of the services or other qualified 
professionals. Such a plan may include, consistent with 
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subsection (b), case management at specified intervals as 
a further condition of payment for services. 
TITLE III—PROVIDER 
PARTICIPATION 
SEC. 301. PROVIDER PARTICIPATION AND STANDARDS. 
(a) IN GENERAL.—An individual or other entity fur-
nishing any covered service under a State health security 
program under this Act is not a qualified provider unless 
the individual or entity— 
(1) is a qualified provider of the services under 
section 302; 
(2) has filed with the State health security pro-
gram a participation agreement described in sub-
section (b); and 
(3) meets such other qualifications and condi-
tions as are established by the Board or the State 
health security program under this Act. 
(b) REQUIREMENTS
IN
PARTICIPATION
AGREE-
MENT.— 
(1) IN
GENERAL.—A participation agreement 
described in this subsection between a State health 
security program and a provider shall provide at 
least for the following: 
(A) Services to eligible persons will be fur-
nished by the provider without discrimination 
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on the ground of race, national origin, income, 
religion, age, sex or sexual orientation, dis-
ability, handicapping condition, or (subject to 
the professional qualifications of the provider) 
illness. Nothing in this subparagraph shall be 
construed as requiring the provision of a type 
or class of services which services are outside 
the scope of the provider’s normal practice. 
(B) No charge will be made for any cov-
ered services other than for payment authorized 
by this Act. 
(C) The provider agrees to furnish such in-
formation as may be reasonably required by the 
Board or a State health security program, in 
accordance with uniform reporting standards 
established under section 401(g)(1), for— 
(i) quality review by designated enti-
ties; 
(ii) the making of payments under 
this Act (including the examination of 
records as may be necessary for the 
verification of information on which pay-
ments are based); 
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(A) IN
GENERAL.—Participation agree-
ments may be terminated, with appropriate no-
tice— 
(i) by the Board or a State health se-
curity program for failure to meet the re-
quirements of this title; or 
(ii) by a provider. 
(B) TERMINATION
PROCESS.—Providers 
shall be provided notice and a reasonable oppor-
tunity to correct deficiencies before the Board 
or a State health security program terminates 
an agreement unless a more immediate termi-
nation is required for public safety or similar 
reasons. 
SEC. 302. QUALIFICATIONS FOR PROVIDERS. 
(a) IN GENERAL.—A health care provider is consid-
ered to be qualified to provide covered services if the pro-
vider is licensed or certified and meets— 
(1) all the requirements of State law to provide 
such services; 
(2) applicable requirements of Federal law to 
provide such services; and 
(3) any applicable standards established under 
subsection (b). 
(b) MINIMUM PROVIDER STANDARDS.— 
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(1) IN GENERAL.—The Board shall establish, 
evaluate, and update national minimum standards to 
ensure the quality of services provided under this 
Act and to monitor efforts by State health security 
programs to ensure the quality of such services. A 
State health security program may also establish ad-
ditional minimum standards which providers shall 
meet. 
(2) NATIONAL MINIMUM STANDARDS.—The na-
tional minimum standards under paragraph (1) shall 
be established for institutional providers of services, 
individual health care practitioners, and comprehen-
sive health service organizations. Except as the 
Board may specify in order to carry out this title, 
a hospital, nursing facility, or other institutional 
provider of services shall meet standards for such a 
facility under the medicare program under title 
XVIII of the Social Security Act (42 U.S.C. 1395 et 
seq.). Such standards also may include, where ap-
propriate, elements relating to— 
(A) adequacy and quality of facilities; 
(B) training and competence of personnel 
(including continuing education requirements); 
(C) comprehensiveness of service; 
(D) continuity of service; 
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(E) patient satisfaction (including waiting 
time and access to services); and 
(F) performance standards (including or-
ganization, facilities, structure of services, effi-
ciency of operation, and outcome in palliation, 
improvement of health, stabilization, cure, or 
rehabilitation). 
(3) TRANSITION
IN
APPLICATION.—If the 
Board provides for additional requirements for pro-
viders under this subsection, any such additional re-
quirement shall be implemented in a manner that 
provides for a reasonable period during which a pre-
viously qualified provider is permitted to meet such 
an additional requirement. 
(4) EXCHANGE OF INFORMATION.—The Board 
shall provide for an exchange, at least annually, 
among State health security programs of informa-
tion with respect to quality assurance and cost con-
tainment. 
SEC. 303. QUALIFICATIONS FOR COMPREHENSIVE HEALTH 
SERVICE ORGANIZATIONS. 
(a) IN GENERAL.—For purposes of this Act, a com-
prehensive health service organization (in this section re-
ferred to as a ‘‘CHSO’’) is a public or private organization 
which, in return for a capitated payment amount, under-
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takes to furnish, arrange for the provision of, or provide 
payment with respect to— 
(1) a full range of health services (as identified 
by the Board), including at least hospital services 
and physicians services; and 
(2) out-of-area coverage in the case of urgently 
needed services, 
to an identified population which is living in or near a 
specified service area and which enrolls voluntarily in the 
organization. 
(b) ENROLLMENT.— 
(1) IN GENERAL.—All eligible persons living in 
or near the specified service area of a CHSO are eli-
gible to enroll in the organization; except that the 
number of enrollees may be limited to avoid over-
taxing the resources of the organization. 
(2) MINIMUM ENROLLMENT PERIOD.—Subject 
to paragraph (3), the minimum period of enrollment 
with a CHSO shall be 1 year, unless the enrolled in-
dividual becomes ineligible to enroll with the organi-
zation. 
(3) WITHDRAWAL
FOR
CAUSE.—Each CHSO 
shall permit an enrolled individual to disenroll from 
the organization for cause at any time. 
(c) REQUIREMENTS FOR CHSOS.— 
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(1) ACCESSIBLE
SERVICES.—Each CHSO, to 
the maximum extent feasible, shall make all health 
services readily and promptly accessible to enrollees 
who live in the specified service area. 
(2) CONTINUITY OF CARE.—Each CHSO shall 
furnish services in such manner as to provide con-
tinuity of care and (when services are furnished by 
different providers) shall provide ready referral of 
patients to such services and at such times as may 
be medically appropriate. 
(3) BOARD OF DIRECTORS.—In the case of a 
CHSO that is a private organization— 
(A) 
CONSUMER
REPRESENTATION.—At 
least one-third of the members of the CHSO’s 
board of directors shall be consumer members 
with no direct or indirect, personal or family fi-
nancial relationship to the organization. 
(B) PROVIDER
REPRESENTATION.—The 
CHSO’s board of directors shall include at least 
one member who represents health care pro-
viders. 
(4) PATIENT
GRIEVANCE
PROGRAM.—Each 
CHSO shall have in effect a patient grievance pro-
gram and shall conduct regularly surveys of the sat-
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isfaction of members with services provided by or 
through the organization. 
(5) MEDICAL STANDARDS.—Each CHSO shall 
provide that a committee or committees of health 
care practitioners associated with the organization 
will promulgate medical standards, oversee the pro-
fessional aspects of the delivery of care, perform the 
functions of a pharmacy and drug therapeutics com-
mittee, and monitor and review the quality of all 
health services (including drugs, education, and pre-
ventive services). 
(6) QUALITY AND OTHER REPORTING REQUIRE-
MENTS.— 
(A) IN GENERAL.—The Board shall deter-
mine appropriate measures to assess the quality 
of care furnished by the CHSO, such as meas-
ures of— 
(i) clinical processes and outcomes; 
(ii) patient and, where practicable, 
caregiver experience of care; and 
(iii) utilization (such as rates of hos-
pital admissions for ambulatory care sen-
sitive conditions). 
(B) OTHER DUTIES.—The CHSO shall— 
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(i) define processes to promote evi-
dence-based medicine and patient engage-
ment, report on quality and cost measures, 
and coordinate care, such as through the 
use of telehealth, remote patient moni-
toring, and other such enabling tech-
nologies; and 
(ii) demonstrate to the Board that the 
CHSO meets patient-centeredness criteria 
specified by the Board, such as the use of 
patient and caregiver assessments or the 
use of individualized care plans. 
(C) 
REPORTING
REQUIREMENTS.—A 
CHSO shall submit data in a form and manner 
specified by the Board on measures the Board 
determines necessary in order to evaluate the 
quality of care furnished by the CHSO. Such 
data may include care transitions across health 
care settings, including hospital discharge plan-
ning and post-hospital discharge follow-up by 
CHSO professionals, as the Board determines 
appropriate. 
(D) 
QUALITY
PERFORMANCE
STAND-
ARDS.—The Board shall establish quality per-
formance standards to assess the quality of care 
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furnished by CHSOs and shall seek to improve 
the quality of care furnished by CHSOs over 
time by specifying higher standards, new meas-
ures, or both for purposes of assessing such 
quality of care. 
(7) PREMIUMS.—Premiums or other charges by 
a CHSO for any services not paid for under this Act 
shall be reasonable. 
(8) UTILIZATION AND BONUS INFORMATION.— 
Each CHSO shall— 
(A) comply with the requirements of sec-
tion 1876(i)(8) of the Social Security Act (re-
lating to prohibiting physician incentive plans 
that provide specific inducements to reduce or 
limit medically necessary services); and 
(B) make available to its membership utili-
zation information and data regarding financial 
performance, including bonus or incentive pay-
ment arrangements to practitioners. 
(9) PROVISION OF SERVICES TO ENROLLEES AT 
INSTITUTIONS
OPERATING
UNDER
GLOBAL
BUDG-
ETS.—The organization shall arrange to reimburse 
for hospital services and other facility-based services 
(as identified by the Board) for services provided to 
members of the organization in accordance with the 
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global operating budget of the hospital or facility ap-
proved under section 611. 
(10) BROAD MARKETING.—Each CHSO shall 
provide for the marketing of its services (including 
dissemination of marketing materials) to potential 
enrollees in a manner that is designed to enroll indi-
viduals representative of the different population 
groups and geographic areas included within its 
service area and meets such requirements as the 
Board or a State health security program may speci-
fy. 
(11) 
ADDITIONAL
REQUIREMENTS.—Each 
CHSO shall meet— 
(A) such requirements relating to min-
imum enrollment; 
(B) such requirements relating to financial 
solvency; 
(C) such requirements relating to quality 
and availability of care; and 
(D) such other requirements, 
as the Board or a State health security program 
may specify. 
(d) PROVISION OF EMERGENCY SERVICES TO NON-
ENROLLEES.—A CHSO may furnish emergency services 
to persons who are not enrolled in the organization. Pay-
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ment for such services, if they are covered services to eligi-
ble persons, shall be made to the organization unless the 
organization requests that it be made to the individual 
provider who furnished the services. 
SEC. 304. LIMITATION ON CERTAIN PHYSICIAN REFERRALS. 
(a) APPLICATION TO AMERICAN HEALTH SECURITY 
PROGRAM.—Section 1877 of the Social Security Act, as 
amended by subsections (b) and (c), shall apply under this 
Act in the same manner as it applies under title XVIII 
of the Social Security Act; except that in applying such 
section under this Act any references in such section to 
the Secretary or title XVIII of the Social Security Act are 
deemed references to the Board and the American Health 
Security Program under this Act, respectively. 
(b) EXPANSION OF PROHIBITION TO CERTAIN ADDI-
TIONAL DESIGNATED SERVICES.—Section 1877(h)(6) of 
the Social Security Act (42 U.S.C. 1395nn(h)(6)) is 
amended by adding at the end the following: 
‘‘(M) Ambulance services. 
‘‘(N) Home infusion therapy services.’’. 
(c) CONFORMING AMENDMENTS.—Section 1877 of 
such Act is further amended— 
(1) in subsection (a)(1)(A), by striking ‘‘for 
which payment otherwise may be made under this 
title’’ and inserting ‘‘for which a charge is imposed’’; 
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(2) in subsection (a)(1)(B), by striking ‘‘under 
this title’’; 
(3) by amending paragraph (1) of subsection 
(g) to read as follows: 
‘‘(1) DENIAL OF PAYMENT.—No payment may 
be made under a State health security program for 
a designated health service for which a claim is pre-
sented in violation of subsection (a)(1)(B). No indi-
vidual, third-party payor, or other entity is liable for 
payment for designated health services for which a 
claim is presented in violation of such subsection.’’; 
and 
(4) in subsection (g)(3), by striking ‘‘for which 
payment may not be made under paragraph (1)’’ 
and inserting ‘‘for which such a claim may not be 
presented under subsection (a)(1)’’. 
TITLE IV—ADMINISTRATION 
Subtitle A—General Administrative 
Provisions 
SEC. 
401. 
AMERICAN 
HEALTH 
SECURITY 
STANDARDS 
BOARD. 
(a) ESTABLISHMENT.—There is hereby established 
an American Health Security Standards Board. 
(b) APPOINTMENT AND TERMS OF MEMBERS.— 
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(1) IN
GENERAL.—The Board shall be com-
posed of— 
(A) the Secretary of Health and Human 
Services; and 
(B) 6 other individuals (described in para-
graph (2)) appointed by the President with the 
advice and consent of the Senate. 
The President shall first nominate individuals under 
subparagraph (B) on a timely basis so as to provide 
for the operation of the Board by not later than 
January 1, 2016. 
(2) SELECTION
OF
APPOINTED
MEMBERS.— 
With respect to the individuals appointed under 
paragraph (1)(B): 
(A) The members shall be chosen on the 
basis of backgrounds in health policy, health ec-
onomics, the healing professions, and the ad-
ministration of health care institutions. 
(B) The members shall provide a balanced 
point of view with respect to the various health 
care interests and at least 2 of them shall rep-
resent the interests of individual consumers. 
(C) At least 1 member shall have a nurs-
ing background. 
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(D) Not more than 3 members shall be 
from the same political party. 
(E) To the greatest extent feasible, the 
members shall represent the various geographic 
regions of the United States and shall reflect 
the racial, ethnic, and gender composition of 
the population of the United States. 
(3) TERMS OF APPOINTED MEMBERS.—Individ-
uals appointed under paragraph (1)(B) shall serve 
for a term of 6 years, except that the terms of 5 of 
the individuals initially appointed shall be, as des-
ignated by the President at the time of their ap-
pointment, for 1, 2, 3, 4, and 5 years. During a 
term of membership on the Board, no member shall 
engage in any other business, vocation or employ-
ment. 
(c) VACANCIES.— 
(1) IN GENERAL.—The President shall fill any 
vacancy in the membership of the Board in the same 
manner as the original appointment. The vacancy 
shall not affect the power of the remaining members 
to execute the duties of the Board. 
(2) VACANCY
APPOINTMENTS.—Any member 
appointed to fill a vacancy shall serve for the re-
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mainder of the term for which the predecessor of the 
member was appointed. 
(3) REAPPOINTMENT.—The President may re-
appoint an appointed member of the Board for a 
second term in the same manner as the original ap-
pointment. A member who has served for 2 consecu-
tive 6-year terms shall not be eligible for reappoint-
ment until 2 years after the member has ceased to 
serve. 
(4) REMOVAL FOR CAUSE.—Upon confirmation, 
members of the Board may not be removed except 
by the President for cause. 
(d) CHAIR.—The President shall designate 1 of the 
members of the Board, other than the Secretary, to serve 
at the will of the President as Chair of the Board. 
(e) COMPENSATION.—Members of the Board (other 
than the Secretary) shall be entitled to compensation at 
a level equivalent to level II of the Executive Schedule, 
in accordance with section 5313 of title 5, United States 
Code. 
(f) GENERAL DUTIES OF THE BOARD.— 
(1) IN
GENERAL.—The Board shall develop 
policies, procedures, guidelines, and requirements to 
carry out this Act, including those related to— 
(A) eligibility; 
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(B) enrollment; 
(C) benefits; 
(D) provider participation standards and 
qualifications, as defined in title III; 
(E) national and State funding levels; 
(F) methods for determining amounts of 
payments to providers of covered services, con-
sistent with subtitle B of title VI; 
(G) the determination of medical necessity 
and appropriateness with respect to coverage of 
certain services; 
(H) assisting State health security pro-
grams with planning for capital expenditures 
and service delivery; 
(I) planning for health professional edu-
cation funding (as specified in title VI); 
(J) allocating funds provided under title 
VII; and 
(K) encouraging States to develop regional 
planning mechanisms (described in section 
404(a)(3)). 
(2) REGULATIONS.—Regulations authorized by 
this Act shall be issued by the Board in accordance 
with the provisions of section 553 of title 5, United 
States Code. 
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(g) UNIFORM REPORTING STANDARDS; ANNUAL RE-
PORT; STUDIES.— 
(1) UNIFORM REPORTING STANDARDS.— 
(A) IN GENERAL.—The Board shall estab-
lish uniform reporting requirements and stand-
ards to ensure an adequate national data base 
regarding health services practitioners, services 
and finances of State health security programs, 
approved plans, providers, and the costs of fa-
cilities and practitioners providing services. 
Such standards shall include, to the maximum 
extent feasible, health outcome measures. 
(B) REPORTS.—The Board shall analyze 
regularly information reported to it, and to 
State health security programs pursuant to 
such requirements and standards. 
(2) ANNUAL REPORT.—Beginning January 1, 
of the second year beginning after the date of the 
enactment of this Act, the Board shall annually re-
port to Congress on the following: 
(A) The status of implementation of the 
Act. 
(B) Enrollment under this Act. 
(C) Benefits under this Act. 
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(D) Expenditures and financing under this 
Act. 
(E) 
Cost-containment 
measures 
and 
achievements under this Act. 
(F) Quality assurance. 
(G) Health care utilization patterns, in-
cluding any changes attributable to the pro-
gram. 
(H) Long-range plans and goals for the de-
livery of health services. 
(I) Differences in the health status of the 
populations of the different States, including in-
come and racial characteristics. 
(J) Necessary changes in the education of 
health personnel. 
(K) Plans for improving service to medi-
cally underserved populations. 
(L) Transition problems as a result of im-
plementation of this Act. 
(M) Opportunities for improvements under 
this Act. 
(3) STATISTICAL ANALYSES AND OTHER STUD-
IES.—The Board may, either directly or by con-
tract— 
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(A) make statistical and other studies, on 
a nationwide, regional, State, or local basis, of 
any aspect of the operation of this Act, includ-
ing studies of the effect of the Act upon the 
health of the people of the United States and 
the effect of comprehensive health services upon 
the health of persons receiving such services; 
(B) develop and test methods of providing 
through payment for services or otherwise, ad-
ditional incentives for adherence by providers to 
standards of adequacy, access, and quality; 
methods of consumer and peer review and peer 
control of the utilization of drugs, of laboratory 
services, and of other services; and methods of 
consumer and peer review of the quality of serv-
ices; 
(C) develop and test, for use by the Board, 
records and information retrieval systems and 
budget systems for health services administra-
tion, and develop and test model systems for 
use by providers of services; 
(D) develop and test, for use by providers 
of services, records and information retrieval 
systems useful in the furnishing of preventive 
or diagnostic services; 
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(E) develop, in collaboration with the phar-
maceutical profession, and test, improved ad-
ministrative practices or improved methods for 
the reimbursement of independent pharmacies 
for the cost of furnishing drugs as a covered 
service; and 
(F) make such other studies as it may con-
sider necessary or promising for the evaluation, 
or for the improvement, of the operation of this 
Act. 
(4) REPORT
ON
USE
OF
EXISTING
FEDERAL 
HEALTH CARE FACILITIES.—Not later than 1 year 
after the date of the enactment of this Act, the 
Board shall recommend to Congress one or more 
proposals for the treatment of health care facilities 
of the Federal Government. 
(h) EXECUTIVE DIRECTOR.— 
(1) APPOINTMENT.—There is hereby estab-
lished the position of Executive Director of the 
Board. The Director shall be appointed by the 
Board and shall serve as secretary to the Board and 
perform such duties in the administration of this 
title as the Board may assign. 
(2) DELEGATION.—The Board is authorized to 
delegate to the Director or to any other officer or 
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employee of the Board or, with the approval of the 
Secretary of Health and Human Services (and sub-
ject to reimbursement of identifiable costs), to any 
other officer or employee of the Department of 
Health and Human Services, any of its functions or 
duties under this Act other than— 
(A) the issuance of regulations; or 
(B) the determination of the availability of 
funds and their allocation to implement this 
Act. 
(3) COMPENSATION.—The Executive Director 
of the Board shall be entitled to compensation at a 
level equivalent to level III of the Executive Sched-
ule, in accordance with section 5314 of title 5, 
United States Code. 
(i) INSPECTOR GENERAL.—The Inspector General 
Act of 1978 (5 U.S.C. App.) is amended— 
(1) in section 12(1), by inserting after ‘‘Cor-
poration;’’ the first place it appears the following: 
‘‘the Chair of the American Health Security Stand-
ards Board;’’; 
(2) in section 12(2), by inserting after ‘‘Resolu-
tion Trust Corporation,’’ the following: ‘‘the Amer-
ican Health Security Standards Board,’’; and 
(3) by inserting before section 9 the following: 
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‘‘SEC. 8N. SPECIAL PROVISIONS CONCERNING THE AMER-
ICAN HEALTH SECURITY STANDARDS BOARD. 
‘‘The Inspector General of the American Health Se-
curity Standards Board, in addition to the other authori-
ties vested by this Act, shall have the same authority, with 
respect to the Board and the American Health Security 
Program under this Act, as the Inspector General for the 
Department of Health and Human Services has with re-
spect to the Secretary of Health and Human Services and 
the medicare and medicaid programs, respectively.’’. 
(j) STAFF.—The Board shall employ such staff as the 
Board may deem necessary. 
(k) ACCESS
TO INFORMATION.—The Secretary of 
Health and Human Services shall make available to the 
Board all information available from sources within the 
Department or from other sources, pertaining to the du-
ties of the Board. 
SEC. 402. AMERICAN HEALTH SECURITY ADVISORY COUN-
CIL. 
(a) IN GENERAL.—The Board shall provide for an 
American Health Security Advisory Council (in this sec-
tion referred to as the ‘‘Council’’) to advise the Board on 
its activities. 
(b) MEMBERSHIP.—The Council shall be composed 
of— 
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(1) the Chair of the Board, who shall serve as 
Chair of the Council; and 
(2) 20 members, not otherwise in the employ of 
the United States, appointed by the Board without 
regard to the provisions of title 5, United States 
Code, governing appointments in the competitive 
service. 
The appointed members shall include, in accordance with 
subsection (e), individuals who are representative of State 
health security programs, public health professionals, pro-
viders of health services, and of individuals (who shall con-
stitute a majority of the Council) who are representative 
of consumers of such services, including a balanced rep-
resentation of employers, unions, consumer organizations, 
and population groups with special health care needs. To 
the greatest extent feasible, the membership of the Council 
shall represent the various geographic regions of the 
United States and shall reflect the racial, ethnic, and gen-
der composition of the population of the United States. 
(c) TERMS OF MEMBERS.—Each appointed member 
shall hold office for a term of 4 years, except that— 
(1) any member appointed to fill a vacancy oc-
curring during the term for which the member’s 
predecessor was appointed shall be appointed for the 
remainder of that term; and 
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(2) the terms of the members first taking office 
shall expire, as designated by the Board at the time 
of appointment, at the end of the first year with re-
spect to 5 members, at the end of the second year 
with respect to 5 members, at the end of the third 
year with respect to 5 members, and at the end of 
the fourth year with respect to 5 members after the 
date of enactment of this Act. 
(d) VACANCIES.— 
(1) IN GENERAL.—The Board shall fill any va-
cancy in the membership of the Council in the same 
manner as the original appointment. The vacancy 
shall not affect the power of the remaining members 
to execute the duties of the Council. 
(2) VACANCY
APPOINTMENTS.—Any member 
appointed to fill a vacancy shall serve for the re-
mainder of the term for which the predecessor of the 
member was appointed. 
(3) REAPPOINTMENT.—The Board may re-
appoint an appointed member of the Council for a 
second term in the same manner as the original ap-
pointment. 
(e) QUALIFICATIONS.— 
(1) PUBLIC
HEALTH
REPRESENTATIVES.— 
Members of the Council who are representative of 
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State health security programs and public health 
professionals shall be individuals who have extensive 
experience in the financing and delivery of care 
under public health programs. 
(2) PROVIDERS.—Members of the Council who 
are representative of providers of health care shall 
be individuals who are outstanding in fields related 
to medical, hospital, or other health activities, or 
who are representative of organizations or associa-
tions of professional health practitioners. 
(3) CONSUMERS.—Members who are represent-
ative of consumers of such care shall be individuals, 
not engaged in and having no financial interest in 
the furnishing of health services, who are familiar 
with the needs of various segments of the population 
for personal health services and are experienced in 
dealing with problems associated with the consump-
tion of such services. 
(f) DUTIES.— 
(1) IN GENERAL.—It shall be the duty of the 
Council— 
(A) to advise the Board on matters of gen-
eral policy in the administration of this Act, in 
the formulation of regulations, and in the per-
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formance of the Board’s duties under section 
401; and 
(B) to study the operation of this Act and 
the utilization of health services under it, with 
a view to recommending any changes in the ad-
ministration of the Act or in its provisions 
which may appear desirable. 
(2) REPORT.—The Council shall make an an-
nual report to the Board on the performance of its 
functions, including any recommendations it may 
have with respect thereto, and the Board shall 
promptly transmit the report to the Congress, to-
gether with a report by the Board on any rec-
ommendations of the Council that have not been fol-
lowed. 
(g) STAFF.—The Council, its members, and any com-
mittees of the Council shall be provided with such secre-
tarial, clerical, or other assistance as may be authorized 
by the Board for carrying out their respective functions. 
(h) MEETINGS.—The Council shall meet as fre-
quently as the Board deems necessary, but not less than 
4 times each year. Upon request by 7 or more members 
it shall be the duty of the Chair to call a meeting of the 
Council. 
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(i) COMPENSATION.—Members of the Council shall 
be reimbursed by the Board for travel and per diem in 
lieu of subsistence expenses during the performance of du-
ties of the Board in accordance with subchapter I of chap-
ter 57 of title 5, United States Code. 
(j) FACA NOT APPLICABLE.—The provisions of the 
Federal Advisory Committee Act shall not apply to the 
Council. 
SEC. 403. CONSULTATION WITH PRIVATE ENTITIES. 
The Secretary and the Board shall consult with pri-
vate entities, such as professional societies, national asso-
ciations, nationally recognized associations of experts, 
medical schools and academic health centers, consumer 
groups, and labor and business organizations in the for-
mulation of guidelines, regulations, policy initiatives, and 
information gathering to ensure the broadest and most in-
formed input in the administration of this Act. Nothing 
in this Act shall prevent the Secretary from adopting 
guidelines developed by such a private entity if, in the Sec-
retary’s and Board’s judgment, such guidelines are gen-
erally accepted as reasonable and prudent and consistent 
with this Act. 
SEC. 404. STATE HEALTH SECURITY PROGRAMS. 
(a) SUBMISSION OF PLANS.— 
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(1) IN GENERAL.—Each State shall submit to 
the Board a plan for a State health security pro-
gram for providing for health care services to the 
residents of the State in accordance with this Act. 
(2) REGIONAL PROGRAMS.—A State may join 
with 1 or more neighboring States to submit to the 
Board a plan for a regional health security program 
instead of separate State health security programs. 
(3) REGIONAL
PLANNING
MECHANISMS.—The 
Board shall provide incentives for States to develop 
regional planning mechanisms to promote the ration-
al distribution of, adequate access to, and efficient 
use of, tertiary care facilities, equipment, and serv-
ices. 
(4) STATES THAT FAIL TO SUBMIT A PLAN.— 
In the case of a State that fails to submit a plan as 
required under this subsection, the American Health 
Security Standards Board Authority shall develop a 
plan for a State health security program in such 
State. 
(b) REVIEW AND APPROVAL OF PLANS.— 
(1) IN
GENERAL.—The Board shall review 
plans submitted under subsection (a) and determine 
whether such plans meet the requirements for ap-
proval. The Board shall not approve such a plan un-
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less it finds that the plan (or State law) provides, 
consistent with the provisions of this Act, for the fol-
lowing: 
(A) Payment for required health services 
for eligible individuals in the State in accord-
ance with this Act. 
(B) Adequate administration, including the 
designation of a single State agency responsible 
for the administration (or supervision of the ad-
ministration) of the program. 
(C) The establishment of a State health se-
curity budget. 
(D) Establishment of payment methodolo-
gies (consistent with subtitle B of title VII). 
(E) Assurances that individuals have the 
freedom to choose practitioners and other 
health care providers for services covered under 
this Act. 
(F) A procedure for carrying out long-term 
regional management and planning functions 
with respect to the delivery and distribution of 
health care services that— 
(i) ensures participation of consumers 
of health services and providers of health 
services; and 
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(ii) gives priority to the most acute 
shortages and maldistributions of health 
personnel and facilities and the most seri-
ous deficiencies in the delivery of covered 
services and to the means for the speedy 
alleviation of these shortcomings. 
(G) The licensure and regulation of all 
health providers and facilities to ensure compli-
ance with Federal and State laws and to pro-
mote quality of care. 
(H) Establishment of a quality review sys-
tem in accordance with section 503. 
(I) Establishment of an independent om-
budsman for consumers to register complaints 
about the organization and administration of 
the State health security program and to help 
resolve complaints and disputes between con-
sumers and providers. 
(J) Publication of an annual report on the 
operation of the State health security program, 
which report shall include information on cost, 
progress towards achieving full enrollment, pub-
lic access to health services, quality review, 
health outcomes, health professional training, 
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and the needs of medically underserved popu-
lations. 
(K) Provision of a fraud and abuse preven-
tion and control unit that the Inspector General 
determines meets the requirements of section 
412(a). 
(L) Prohibit payment in cases of prohib-
ited physician referrals under section 304. 
(2) CONSEQUENCES OF FAILURE TO COMPLY.— 
If the Board finds that a State plan submitted 
under paragraph (1) does not meet the requirements 
for approval under this section or that a State 
health security program or specific portion of such 
program, the plan for which was previously ap-
proved, no longer meets such requirements, the 
Board shall provide notice to the State of such fail-
ure and that unless corrective action is taken within 
a period specified by the Board, the Board shall 
place the State health security program (or specific 
portions of such program) in receivership under the 
jurisdiction of the Board. 
(c) STATE HEALTH SECURITY ADVISORY COUN-
CILS.— 
(1) IN GENERAL.—For each State, the Gov-
ernor shall provide for appointment of a State 
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Health Security Advisory Council to advise and 
make recommendations to the Governor and State 
with respect to the implementation of the State 
health security program in the State. 
(2) MEMBERSHIP.—Each State Health Security 
Advisory Council shall be composed of at least 11 in-
dividuals. The appointed members shall include indi-
viduals who are representative of the State health 
security program, public health professionals, pro-
viders of health services, and of individuals (who 
shall constitute a majority) who are representative of 
consumers of such services, including a balanced 
representation of employers, unions and consumer 
organizations. To the greatest extent feasible, the 
membership of each State Health Security Advisory 
Council shall represent the various geographic re-
gions of the State and shall reflect the racial, ethnic, 
and gender composition of the population of the 
State. 
(3) DUTIES.— 
(A) IN GENERAL.—Each State Health Se-
curity Advisory Council shall review, and sub-
mit comments to the Governor concerning the 
implementation of the State health security pro-
gram in the State. 
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(B) ASSISTANCE.—Each State Health Se-
curity Advisory Council shall provide assistance 
and technical support to community organiza-
tions and public and private non-profit agencies 
submitting applications for funding under ap-
propriate State and Federal public health pro-
grams, with particular emphasis placed on as-
sisting those applicants with broad consumer 
representation. 
(d) STATE USE OF FISCAL AGENTS.— 
(1) IN GENERAL.—Each State health security 
program, using competitive bidding procedures, may 
enter into such contracts with qualified entities, such 
as voluntary associations, as the State determines to 
be appropriate to process claims and to perform 
other related functions of fiscal agents under the 
State health security program. 
(2) RESTRICTION.—Except as the Board may 
provide for good cause shown, in no case may more 
than 1 contract described in paragraph (1) be en-
tered into under a State health security program. 
SEC. 
405. 
COMPLEMENTARY 
CONDUCT 
OF 
RELATED 
HEALTH PROGRAMS. 
In performing functions with respect to health per-
sonnel education and training, health research, environ-
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mental health, disability insurance, vocational rehabilita-
tion, the regulation of food and drugs, and all other mat-
ters pertaining to health, the Secretary of Health and 
Human Services shall direct all activities of the Depart-
ment of Health and Human Services toward contributions 
to the health of the people complementary to this Act. 
Subtitle B—Control Over Fraud 
and Abuse 
SEC. 411. APPLICATION OF FEDERAL SANCTIONS TO ALL 
FRAUD 
AND 
ABUSE 
UNDER 
AMERICAN 
HEALTH SECURITY PROGRAM. 
The following sections of the Social Security Act shall 
apply to State health security programs in the same man-
ner as they apply to State medical assistance plans under 
title XIX of such Act (except that in applying such provi-
sions any reference to the Secretary is deemed a reference 
to the Board): 
(1) Section 1128 (relating to exclusion of indi-
viduals and entities). 
(2) Section 1128A (civil monetary penalties). 
(3) Section 1128B (criminal penalties). 
(4) Section 1124 (relating to disclosure of own-
ership and related information). 
(5) Section 1126 (relating to disclosure of cer-
tain owners). 
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SEC. 412. REQUIREMENTS FOR OPERATION OF STATE 
HEALTH CARE FRAUD AND ABUSE CONTROL 
UNITS. 
(a) REQUIREMENT.—In order to meet the require-
ment of section 404(b)(1)(K), each State health security 
program shall establish and maintain a health care fraud 
and abuse control unit (in this section referred to as a 
‘‘fraud unit’’) that meets requirements of this section and 
other requirements of the Board. Such a unit may be a 
State medicaid fraud control unit (described in section 
1903(q) of the Social Security Act). 
(b) STRUCTURE OF UNIT.—The fraud unit shall— 
(1) be a single identifiable entity of the State 
government; 
(2) be separate and distinct from the State 
agency with principal responsibility for the adminis-
tration of the State health security program; and 
(3) meet one of the following requirements: 
(A) It shall be a unit of the office of the 
State Attorney General or of another depart-
ment of State government which possesses 
statewide authority to prosecute individuals for 
criminal violations. 
(B) If it is in a State the constitution of 
which does not provide for the criminal prosecu-
tion of individuals by a statewide authority and 
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has formal procedures, approved by the Board, 
that— 
(i) assure its referral of suspected 
criminal violations relating to the State 
health insurance plan to the appropriate 
authority or authorities in the States for 
prosecution; and 
(ii) assure its assistance of, and co-
ordination with, such authority or authori-
ties in such prosecutions. 
(C) It shall have a formal working relation-
ship with the office of the State Attorney Gen-
eral and have formal procedures (including pro-
cedures for its referral of suspected criminal 
violations to such office) which are approved by 
the Board and which provide effective coordina-
tion of activities between the fraud unit and 
such office with respect to the detection, inves-
tigation, and prosecution of suspected criminal 
violations relating to the State health insurance 
plan. 
(c) FUNCTIONS.—The fraud unit shall— 
(1) have the function of conducting a statewide 
program for the investigation and prosecution of vio-
lations of all applicable State laws regarding any 
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and all aspects of fraud in connection with any as-
pect of the provision of health care services and ac-
tivities of providers of such services under the State 
health security program; 
(2) have procedures for reviewing complaints of 
the abuse and neglect of patients of providers and 
facilities that receive payments under the State 
health security program, and, where appropriate, for 
acting upon such complaints under the criminal laws 
of the State or for referring them to other State 
agencies for action; and 
(3) provide for the collection, or referral for col-
lection to a single State agency, of overpayments 
that are made under the State health security pro-
gram to providers and that are discovered by the 
fraud unit in carrying out its activities. 
(d) RESOURCES.—The fraud unit shall— 
(1) employ such auditors, attorneys, investiga-
tors, and other necessary personnel; 
(2) be organized in such a manner; and 
(3) provide sufficient resources (as specified by 
the Board), 
as is necessary to promote the effective and efficient con-
duct of the unit’s activities. 
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(e) COOPERATIVE AGREEMENTS.—The fraud unit 
shall have cooperative agreements (as specified by the 
Board) with— 
(1) similar fraud units in other States; 
(2) the Inspector General; and 
(3) the Attorney General of the United States. 
(f) REPORTS.—The fraud unit shall submit to the In-
spector General an application and annual reports con-
taining such information as the Inspector General deter-
mines to be necessary to determine whether the unit meets 
the previous requirements of this section. 
TITLE V—QUALITY ASSESSMENT 
SEC. 501. AMERICAN HEALTH SECURITY QUALITY COUNCIL. 
(a) ESTABLISHMENT.—There is hereby established 
an American Health Security Quality Council (in this title 
referred to as the ‘‘Council’’). 
(b) DUTIES OF THE COUNCIL.—The Council shall 
perform the following duties: 
(1) PRACTICE GUIDELINES.—The Council shall 
review and evaluate each practice guideline devel-
oped under part B of title IX of the Public Health 
Service Act. The Council shall determine whether 
the guideline should be recognized as a national 
practice guideline to be used under section 204(d) 
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for purposes of determining payments under a State 
health security program. 
(2) STANDARDS
OF
QUALITY, PERFORMANCE 
MEASURES, AND MEDICAL REVIEW CRITERIA.—The 
Council shall review and evaluate each standard of 
quality, performance measure, and medical review 
criterion developed under part B of title IX of the 
Public Health Service Act. The Council shall deter-
mine whether the standard, measure, or criterion is 
appropriate for use in assessing or reviewing the 
quality of services provided by State health security 
programs, health care institutions, or health care 
professionals. 
(3) CRITERIA
FOR
ENTITIES
CONDUCTING 
QUALITY REVIEWS.—The Council shall develop min-
imum criteria for competence for entities that can 
qualify to conduct ongoing and continuous external 
quality review for State quality review programs 
under section 503. Such criteria shall require such 
an entity to be administratively independent of the 
individual or board that administers the State health 
security program and shall ensure that such entities 
do not provide financial incentives to reviewers to 
favor one pattern of practice over another. The 
Council shall ensure coordination and reporting by 
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such entities to ensure national consistency in qual-
ity standards. 
(4) REPORTING.—The Council shall report to 
the Board annually on the conduct of activities 
under such title and shall report to the Board annu-
ally specifically on findings from outcomes research 
and development of practice guidelines that may af-
fect the Board’s determination of coverage of serv-
ices under section 401(f)(1)(G). 
(5) OTHER
FUNCTIONS.—The Council shall 
perform the functions of the Council described in 
section 502. 
(c) APPOINTMENT AND TERMS OF MEMBERS.— 
(1) IN GENERAL.—The Council shall be com-
posed of 10 members appointed by the President. 
The President shall first appoint individuals on a 
timely basis so as to provide for the operation of the 
Council by not later than January 1, 2016. 
(2) SELECTION OF MEMBERS.—Each member 
of the Council shall be a member of a health profes-
sion. Five members of the Council shall be physi-
cians. Individuals shall be appointed to the Council 
on the basis of national reputations for clinical and 
academic excellence. To the greatest extent feasible, 
the membership of the Council shall represent the 
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various geographic regions of the United States and 
shall reflect the racial, ethnic, and gender composi-
tion of the population of the United States. 
(3) TERMS
OF
MEMBERS.—Individuals ap-
pointed to the Council shall serve for a term of 5 
years, except that the terms of 4 of the individuals 
initially appointed shall be, as designated by the 
President at the time of their appointment, for 1, 2, 
3, and 4 years. 
(d) VACANCIES.— 
(1) IN GENERAL.—The President shall fill any 
vacancy in the membership of the Council in the 
same manner as the original appointment. The va-
cancy shall not affect the power of the remaining 
members to execute the duties of the Council. 
(2) VACANCY
APPOINTMENTS.—Any member 
appointed to fill a vacancy shall serve for the re-
mainder of the term for which the predecessor of the 
member was appointed. 
(3) REAPPOINTMENT.—The President may re-
appoint a member of the Council for a second term 
in the same manner as the original appointment. A 
member who has served for 2 consecutive 5-year 
terms shall not be eligible for reappointment until 2 
years after the member has ceased to serve. 
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(e) CHAIR.—The President shall designate 1 of the 
members of the Council to serve at the will of the Presi-
dent as Chair of the Council. 
(f) COMPENSATION.—Members of the Council who 
are not employees of the Federal Government shall be en-
titled to compensation at a level equivalent to level II of 
the Executive Schedule, in accordance with section 5313 
of title 5, United States Code. 
SEC. 502. DEVELOPMENT OF CERTAIN METHODOLOGIES, 
GUIDELINES, AND STANDARDS. 
(a) PROFILING OF PATTERNS OF PRACTICE; IDENTI-
FICATION OF OUTLIERS.—The Council shall adopt meth-
odologies for profiling the patterns of practice of health 
care professionals and for identifying outliers (as defined 
in subsection (e)). 
(b) CENTERS OF EXCELLENCE.—The Council shall 
develop guidelines for certain medical procedures des-
ignated by the Board to be performed only at tertiary care 
centers which can meet standards for frequency of proce-
dure performance and intensity of support mechanisms 
that are consistent with the high probability of desired pa-
tient outcome. Reimbursement under this Act for such a 
designated procedure may only be provided if the proce-
dure was performed at a center that meets such stand-
ards. 
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