H. R. 3590 
One Hundred Eleventh Congress 
of the 
United States of America 
AT THE SECOND SESSION 
Begun and held at the City of Washington on Tuesday, 
the fifth day of January, two thousand and ten 
An Act 
Entitled The Patient Protection and Affordable Care Act. 
Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the ‘‘Patient Protec-
tion and Affordable Care Act’’. 
(b) TABLE OF CONTENTS.—The table of contents of this Act 
is as follows: 
Sec. 1. Short title; table of contents. 
TITLE I—QUALITY, AFFORDABLE HEALTH CARE FOR ALL AMERICANS 
Subtitle A—Immediate Improvements in Health Care Coverage for All Americans 
Sec. 1001. Amendments to the Public Health Service Act. 
‘‘PART A—INDIVIDUAL AND GROUP MARKET REFORMS 
‘‘SUBPART II—IMPROVING COVERAGE 
‘‘Sec. 2711. No lifetime or annual limits. 
‘‘Sec. 2712. Prohibition on rescissions. 
‘‘Sec. 2713. Coverage of preventive health services. 
‘‘Sec. 2714. Extension of dependent coverage. 
‘‘Sec. 2715. Development and utilization of uniform explanation of coverage 
documents and standardized definitions. 
‘‘Sec. 2716. Prohibition of discrimination based on salary. 
‘‘Sec. 2717. Ensuring the quality of care. 
‘‘Sec. 2718. Bringing down the cost of health care coverage. 
‘‘Sec. 2719. Appeals process. 
Sec. 1002. Health insurance consumer information. 
Sec. 1003. Ensuring that consumers get value for their dollars. 
Sec. 1004. Effective dates. 
Subtitle B—Immediate Actions to Preserve and Expand Coverage 
Sec. 1101. Immediate access to insurance for uninsured individuals with a pre-
existing condition. 
Sec. 1102. Reinsurance for early retirees. 
Sec. 1103. Immediate information that allows consumers to identify affordable cov-
erage options. 
Sec. 1104. Administrative simplification. 
Sec. 1105. Effective date. 
Subtitle C—Quality Health Insurance Coverage for All Americans 
PART I—HEALTH INSURANCE MARKET REFORMS 
Sec. 1201. Amendment to the Public Health Service Act. 
‘‘SUBPART I—GENERAL REFORM 
‘‘Sec. 2704. Prohibition of preexisting condition exclusions or other discrimina-
tion based on health status. 
‘‘Sec. 2701. Fair health insurance premiums. 
‘‘Sec. 2702. Guaranteed availability of coverage.
H. R. 3590—2 
‘‘Sec. 2703. Guaranteed renewability of coverage. 
‘‘Sec. 2705. Prohibiting discrimination against individual participants and 
beneficiaries based on health status. 
‘‘Sec. 2706. Non-discrimination in health care. 
‘‘Sec. 2707. Comprehensive health insurance coverage. 
‘‘Sec. 2708. Prohibition on excessive waiting periods. 
PART II—OTHER PROVISIONS 
Sec. 1251. Preservation of right to maintain existing coverage. 
Sec. 1252. Rating reforms must apply uniformly to all health insurance issuers and 
group health plans. 
Sec. 1253. Effective dates. 
Subtitle D—Available Coverage Choices for All Americans 
PART I—ESTABLISHMENT OF QUALIFIED HEALTH PLANS 
Sec. 1301. Qualified health plan defined. 
Sec. 1302. Essential health benefits requirements. 
Sec. 1303. Special rules. 
Sec. 1304. Related definitions. 
PART II—CONSUMER CHOICES AND INSURANCE COMPETITION THROUGH HEALTH 
BENEFIT EXCHANGES 
Sec. 1311. Affordable choices of health benefit plans. 
Sec. 1312. Consumer choice. 
Sec. 1313. Financial integrity. 
PART III—STATE FLEXIBILITY RELATING TO EXCHANGES 
Sec. 1321. State flexibility in operation and enforcement of Exchanges and related 
requirements. 
Sec. 1322. Federal program to assist establishment and operation of nonprofit, 
member-run health insurance issuers. 
Sec. 1323. Community health insurance option. 
Sec. 1324. Level playing field. 
PART IV—STATE FLEXIBILITY TO ESTABLISH ALTERNATIVE PROGRAMS 
Sec. 1331. State flexibility to establish basic health programs for low-income indi-
viduals not eligible for Medicaid. 
Sec. 1332. Waiver for State innovation. 
Sec. 1333. Provisions relating to offering of plans in more than one State. 
PART V—REINSURANCE AND RISK ADJUSTMENT 
Sec. 1341. Transitional reinsurance program for individual and small group mar-
kets in each State. 
Sec. 1342. Establishment of risk corridors for plans in individual and small group 
markets. 
Sec. 1343. Risk adjustment. 
Subtitle E—Affordable Coverage Choices for All Americans 
PART I—PREMIUM TAX CREDITS AND COST-SHARING REDUCTIONS 
SUBPART A—PREMIUM TAX CREDITS AND COST-SHARING REDUCTIONS 
Sec. 1401. Refundable tax credit providing premium assistance for coverage under 
a qualified health plan. 
Sec. 1402. Reduced cost-sharing for individuals enrolling in qualified health plans. 
SUBPART B—ELIGIBILITY DETERMINATIONS 
Sec. 1411. Procedures for determining eligibility for Exchange participation, pre-
mium tax credits and reduced cost-sharing, and individual responsibility 
exemptions. 
Sec. 1412. Advance determination and payment of premium tax credits and cost- 
sharing reductions. 
Sec. 1413. Streamlining of procedures for enrollment through an exchange and 
State Medicaid, CHIP, and health subsidy programs. 
Sec. 1414. Disclosures to carry out eligibility requirements for certain programs. 
Sec. 1415. Premium tax credit and cost-sharing reduction payments disregarded for 
Federal and Federally-assisted programs. 
PART II—SMALL BUSINESS TAX CREDIT 
Sec. 1421. Credit for employee health insurance expenses of small businesses.
H. R. 3590—3 
Subtitle F—Shared Responsibility for Health Care 
PART I—INDIVIDUAL RESPONSIBILITY 
Sec. 1501. Requirement to maintain minimum essential coverage. 
Sec. 1502. Reporting of health insurance coverage. 
PART II—EMPLOYER RESPONSIBILITIES 
Sec. 1511. Automatic enrollment for employees of large employers. 
Sec. 1512. Employer requirement to inform employees of coverage options. 
Sec. 1513. Shared responsibility for employers. 
Sec. 1514. Reporting of employer health insurance coverage. 
Sec. 1515. Offering of Exchange-participating qualified health plans through cafe-
teria plans. 
Subtitle G—Miscellaneous Provisions 
Sec. 1551. Definitions. 
Sec. 1552. Transparency in government. 
Sec. 1553. Prohibition against discrimination on assisted suicide. 
Sec. 1554. Access to therapies. 
Sec. 1555. Freedom not to participate in Federal health insurance programs. 
Sec. 1556. Equity for certain eligible survivors. 
Sec. 1557. Nondiscrimination. 
Sec. 1558. Protections for employees. 
Sec. 1559. Oversight. 
Sec. 1560. Rules of construction. 
Sec. 1561. Health information technology enrollment standards and protocols. 
Sec. 1562. Conforming amendments. 
Sec. 1563. Sense of the Senate promoting fiscal responsibility. 
TITLE II—ROLE OF PUBLIC PROGRAMS 
Subtitle A—Improved Access to Medicaid 
Sec. 2001. Medicaid coverage for the lowest income populations. 
Sec. 2002. Income eligibility for nonelderly determined using modified gross in-
come. 
Sec. 2003. Requirement to offer premium assistance for employer-sponsored insur-
ance. 
Sec. 2004. Medicaid coverage for former foster care children. 
Sec. 2005. Payments to territories. 
Sec. 2006. Special adjustment to FMAP determination for certain States recovering 
from a major disaster. 
Sec. 2007. Medicaid Improvement Fund rescission. 
Subtitle B—Enhanced Support for the Children’s Health Insurance Program 
Sec. 2101. Additional federal financial participation for CHIP. 
Sec. 2102. Technical corrections. 
Subtitle C—Medicaid and CHIP Enrollment Simplification 
Sec. 2201. Enrollment Simplification and coordination with State Health Insurance 
Exchanges. 
Sec. 2202. Permitting hospitals to make presumptive eligibility determinations for 
all Medicaid eligible populations. 
Subtitle D—Improvements to Medicaid Services 
Sec. 2301. Coverage for freestanding birth center services. 
Sec. 2302. Concurrent care for children. 
Sec. 2303. State eligibility option for family planning services. 
Sec. 2304. Clarification of definition of medical assistance. 
Subtitle E—New Options for States to Provide Long-Term Services and Supports 
Sec. 2401. Community First Choice Option. 
Sec. 2402. Removal of barriers to providing home and community-based services. 
Sec. 2403. Money Follows the Person Rebalancing Demonstration. 
Sec. 2404. Protection for recipients of home and community-based services against 
spousal impoverishment. 
Sec. 2405. Funding to expand State Aging and Disability Resource Centers. 
Sec. 2406. Sense of the Senate regarding long-term care. 
Subtitle F—Medicaid Prescription Drug Coverage 
Sec. 2501. Prescription drug rebates.
H. R. 3590—4 
Sec. 2502. Elimination of exclusion of coverage of certain drugs. 
Sec. 2503. Providing adequate pharmacy reimbursement. 
Subtitle G—Medicaid Disproportionate Share Hospital (DSH) Payments 
Sec. 2551. Disproportionate share hospital payments. 
Subtitle H—Improved Coordination for Dual Eligible Beneficiaries 
Sec. 2601. 5-year period for demonstration projects. 
Sec. 2602. Providing Federal coverage and payment coordination for dual eligible 
beneficiaries. 
Subtitle I—Improving the Quality of Medicaid for Patients and Providers 
Sec. 2701. Adult health quality measures. 
Sec. 2702. Payment Adjustment for Health Care-Acquired Conditions. 
Sec. 2703. State option to provide health homes for enrollees with chronic condi-
tions. 
Sec. 2704. Demonstration project to evaluate integrated care around a hospitaliza-
tion. 
Sec. 2705. Medicaid Global Payment System Demonstration Project. 
Sec. 2706. Pediatric Accountable Care Organization Demonstration Project. 
Sec. 2707. Medicaid emergency psychiatric demonstration project. 
Subtitle J—Improvements to the Medicaid and CHIP Payment and Access 
Commission (MACPAC) 
Sec. 2801. MACPAC assessment of policies affecting all Medicaid beneficiaries. 
Subtitle K—Protections for American Indians and Alaska Natives 
Sec. 2901. Special rules relating to Indians. 
Sec. 2902. Elimination of sunset for reimbursement for all medicare part B services 
furnished by certain indian hospitals and clinics. 
Subtitle L—Maternal and Child Health Services 
Sec. 2951. Maternal, infant, and early childhood home visiting programs. 
Sec. 2952. Support, education, and research for postpartum depression. 
Sec. 2953. Personal responsibility education. 
Sec. 2954. Restoration of funding for abstinence education. 
Sec. 2955. Inclusion of information about the importance of having a health care 
power of attorney in transition planning for children aging out of foster 
care and independent living programs. 
TITLE III—IMPROVING THE QUALITY AND EFFICIENCY OF HEALTH CARE 
Subtitle A—Transforming the Health Care Delivery System 
PART I—LINKING PAYMENT TO QUALITY OUTCOMES UNDER THE MEDICARE PROGRAM 
Sec. 3001. Hospital Value-Based purchasing program. 
Sec. 3002. Improvements to the physician quality reporting system. 
Sec. 3003. Improvements to the physician feedback program. 
Sec. 3004. Quality reporting for long-term care hospitals, inpatient rehabilitation 
hospitals, and hospice programs. 
Sec. 3005. Quality reporting for PPS-exempt cancer hospitals. 
Sec. 3006. Plans for a Value-Based purchasing program for skilled nursing facilities 
and home health agencies. 
Sec. 3007. Value-based payment modifier under the physician fee schedule. 
Sec. 3008. Payment adjustment for conditions acquired in hospitals. 
PART II—NATIONAL STRATEGY TO IMPROVE HEALTH CARE QUALITY 
Sec. 3011. National strategy. 
Sec. 3012. Interagency Working Group on Health Care Quality. 
Sec. 3013. Quality measure development. 
Sec. 3014. Quality measurement. 
Sec. 3015. Data collection; public reporting. 
PART III—ENCOURAGING DEVELOPMENT OF NEW PATIENT CARE MODELS 
Sec. 3021. Establishment of Center for Medicare and Medicaid Innovation within 
CMS. 
Sec. 3022. Medicare shared savings program. 
Sec. 3023. National pilot program on payment bundling. 
Sec. 3024. Independence at home demonstration program. 
Sec. 3025. Hospital readmissions reduction program.
H. R. 3590—5 
Sec. 3026. Community-Based Care Transitions Program. 
Sec. 3027. Extension of gainsharing demonstration. 
Subtitle B—Improving Medicare for Patients and Providers 
PART I—ENSURING BENEFICIARY ACCESS TO PHYSICIAN CARE AND OTHER SERVICES 
Sec. 3101. Increase in the physician payment update. 
Sec. 3102. Extension of the work geographic index floor and revisions to the prac-
tice expense geographic adjustment under the Medicare physician fee 
schedule. 
Sec. 3103. Extension of exceptions process for Medicare therapy caps. 
Sec. 3104. Extension of payment for technical component of certain physician pa-
thology services. 
Sec. 3105. Extension of ambulance add-ons. 
Sec. 3106. Extension of certain payment rules for long-term care hospital services 
and of moratorium on the establishment of certain hospitals and facili-
ties. 
Sec. 3107. Extension of physician fee schedule mental health add-on. 
Sec. 3108. Permitting physician assistants to order post-Hospital extended care 
services. 
Sec. 3109. Exemption of certain pharmacies from accreditation requirements. 
Sec. 3110. Part B special enrollment period for disabled TRICARE beneficiaries. 
Sec. 3111. Payment for bone density tests. 
Sec. 3112. Revision to the Medicare Improvement Fund. 
Sec. 3113. Treatment of certain complex diagnostic laboratory tests. 
Sec. 3114. Improved access for certified nurse-midwife services. 
PART II—RURAL PROTECTIONS 
Sec. 3121. Extension of outpatient hold harmless provision. 
Sec. 3122. Extension of Medicare reasonable costs payments for certain clinical di-
agnostic laboratory tests furnished to hospital patients in certain rural 
areas. 
Sec. 3123. Extension of the Rural Community Hospital Demonstration Program. 
Sec. 3124. Extension of the Medicare-dependent hospital (MDH) program. 
Sec. 3125. Temporary improvements to the Medicare inpatient hospital payment 
adjustment for low-volume hospitals. 
Sec. 3126. Improvements to the demonstration project on community health inte-
gration models in certain rural counties. 
Sec. 3127. MedPAC study on adequacy of Medicare payments for health care pro-
viders serving in rural areas. 
Sec. 3128. Technical correction related to critical access hospital services. 
Sec. 3129. Extension of and revisions to Medicare rural hospital flexibility program. 
PART III—IMPROVING PAYMENT ACCURACY 
Sec. 3131. Payment adjustments for home health care. 
Sec. 3132. Hospice reform. 
Sec. 3133. Improvement to medicare disproportionate share hospital (DSH) pay-
ments. 
Sec. 3134. Misvalued codes under the physician fee schedule. 
Sec. 3135. Modification of equipment utilization factor for advanced imaging serv-
ices. 
Sec. 3136. Revision of payment for power-driven wheelchairs. 
Sec. 3137. Hospital wage index improvement. 
Sec. 3138. Treatment of certain cancer hospitals. 
Sec. 3139. Payment for biosimilar biological products. 
Sec. 3140. Medicare hospice concurrent care demonstration program. 
Sec. 3141. Application of budget neutrality on a national basis in the calculation of 
the Medicare hospital wage index floor. 
Sec. 3142. HHS study on urban Medicare-dependent hospitals. 
Sec. 3143. Protecting home health benefits. 
Subtitle C—Provisions Relating to Part C 
Sec. 3201. Medicare Advantage payment. 
Sec. 3202. Benefit protection and simplification. 
Sec. 3203. Application of coding intensity adjustment during MA payment transi-
tion. 
Sec. 3204. Simplification of annual beneficiary election periods. 
Sec. 3205. Extension for specialized MA plans for special needs individuals. 
Sec. 3206. Extension of reasonable cost contracts. 
Sec. 3207. Technical correction to MA private fee-for-service plans. 
Sec. 3208. Making senior housing facility demonstration permanent.
H. R. 3590—6 
Sec. 3209. Authority to deny plan bids. 
Sec. 3210. Development of new standards for certain Medigap plans. 
Subtitle D—Medicare Part D Improvements for Prescription Drug Plans and MA– 
PD Plans 
Sec. 3301. Medicare coverage gap discount program. 
Sec. 3302. Improvement in determination of Medicare part D low-income bench-
mark premium. 
Sec. 3303. Voluntary de minimis policy for subsidy eligible individuals under pre-
scription drug plans and MA–PD plans. 
Sec. 3304. Special rule for widows and widowers regarding eligibility for low-in-
come assistance. 
Sec. 3305. Improved information for subsidy eligible individuals reassigned to pre-
scription drug plans and MA–PD plans. 
Sec. 3306. Funding outreach and assistance for low-income programs. 
Sec. 3307. Improving formulary requirements for prescription drug plans and MA– 
PD plans with respect to certain categories or classes of drugs. 
Sec. 3308. Reducing part D premium subsidy for high-income beneficiaries. 
Sec. 3309. Elimination of cost sharing for certain dual eligible individuals. 
Sec. 3310. Reducing wasteful dispensing of outpatient prescription drugs in long- 
term care facilities under prescription drug plans and MA–PD plans. 
Sec. 3311. Improved Medicare prescription drug plan and MA–PD plan complaint 
system. 
Sec. 3312. Uniform exceptions and appeals process for prescription drug plans and 
MA–PD plans. 
Sec. 3313. Office of the Inspector General studies and reports. 
Sec. 3314. Including costs incurred by AIDS drug assistance programs and Indian 
Health Service in providing prescription drugs toward the annual out- 
of-pocket threshold under part D. 
Sec. 3315. Immediate reduction in coverage gap in 2010. 
Subtitle E—Ensuring Medicare Sustainability 
Sec. 3401. Revision of certain market basket updates and incorporation of produc-
tivity improvements into market basket updates that do not already in-
corporate such improvements. 
Sec. 3402. Temporary adjustment to the calculation of part B premiums. 
Sec. 3403. Independent Medicare Advisory Board. 
Subtitle F—Health Care Quality Improvements 
Sec. 3501. Health care delivery system research; Quality improvement technical as-
sistance. 
Sec. 3502. Establishing community health teams to support the patient-centered 
medical home. 
Sec. 3503. Medication management services in treatment of chronic disease. 
Sec. 3504. Design and implementation of regionalized systems for emergency care. 
Sec. 3505. Trauma care centers and service availability. 
Sec. 3506. Program to facilitate shared decisionmaking. 
Sec. 3507. Presentation of prescription drug benefit and risk information. 
Sec. 3508. Demonstration program to integrate quality improvement and patient 
safety training into clinical education of health professionals. 
Sec. 3509. Improving women’s health. 
Sec. 3510. Patient navigator program. 
Sec. 3511. Authorization of appropriations. 
Subtitle G—Protecting and Improving Guaranteed Medicare Benefits 
Sec. 3601. Protecting and improving guaranteed Medicare benefits. 
Sec. 3602. No cuts in guaranteed benefits. 
TITLE IV—PREVENTION OF CHRONIC DISEASE AND IMPROVING PUBLIC 
HEALTH 
Subtitle A—Modernizing Disease Prevention and Public Health Systems 
Sec. 4001. National Prevention, Health Promotion and Public Health Council. 
Sec. 4002. Prevention and Public Health Fund. 
Sec. 4003. Clinical and community preventive services. 
Sec. 4004. Education and outreach campaign regarding preventive benefits. 
Subtitle B—Increasing Access to Clinical Preventive Services 
Sec. 4101. School-based health centers. 
Sec. 4102. Oral healthcare prevention activities.
H. R. 3590—7 
Sec. 4103. Medicare coverage of annual wellness visit providing a personalized pre-
vention plan. 
Sec. 4104. Removal of barriers to preventive services in Medicare. 
Sec. 4105. Evidence-based coverage of preventive services in Medicare. 
Sec. 4106. Improving access to preventive services for eligible adults in Medicaid. 
Sec. 4107. Coverage of comprehensive tobacco cessation services for pregnant 
women in Medicaid. 
Sec. 4108. Incentives for prevention of chronic diseases in medicaid. 
Subtitle C—Creating Healthier Communities 
Sec. 4201. Community transformation grants. 
Sec. 4202. Healthy aging, living well; evaluation of community-based prevention 
and wellness programs for Medicare beneficiaries. 
Sec. 4203. Removing barriers and improving access to wellness for individuals with 
disabilities. 
Sec. 4204. Immunizations. 
Sec. 4205. Nutrition labeling of standard menu items at chain restaurants. 
Sec. 4206. Demonstration project concerning individualized wellness plan. 
Sec. 4207. Reasonable break time for nursing mothers. 
Subtitle D—Support for Prevention and Public Health Innovation 
Sec. 4301. Research on optimizing the delivery of public health services. 
Sec. 4302. Understanding health disparities: data collection and analysis. 
Sec. 4303. CDC and employer-based wellness programs. 
Sec. 4304. Epidemiology-Laboratory Capacity Grants. 
Sec. 4305. Advancing research and treatment for pain care management. 
Sec. 4306. Funding for Childhood Obesity Demonstration Project. 
Subtitle E—Miscellaneous Provisions 
Sec. 4401. Sense of the Senate concerning CBO scoring. 
Sec. 4402. Effectiveness of Federal health and wellness initiatives. 
TITLE V—HEALTH CARE WORKFORCE 
Subtitle A—Purpose and Definitions 
Sec. 5001. Purpose. 
Sec. 5002. Definitions. 
Subtitle B—Innovations in the Health Care Workforce 
Sec. 5101. National health care workforce commission. 
Sec. 5102. State health care workforce development grants. 
Sec. 5103. Health care workforce assessment. 
Subtitle C—Increasing the Supply of the Health Care Workforce 
Sec. 5201. Federally supported student loan funds. 
Sec. 5202. Nursing student loan program. 
Sec. 5203. Health care workforce loan repayment programs. 
Sec. 5204. Public health workforce recruitment and retention programs. 
Sec. 5205. Allied health workforce recruitment and retention programs. 
Sec. 5206. Grants for State and local programs. 
Sec. 5207. Funding for National Health Service Corps. 
Sec. 5208. Nurse-managed health clinics. 
Sec. 5209. Elimination of cap on commissioned corps. 
Sec. 5210. Establishing a Ready Reserve Corps. 
Subtitle D—Enhancing Health Care Workforce Education and Training 
Sec. 5301. Training in family medicine, general internal medicine, general pediat-
rics, and physician assistantship. 
Sec. 5302. Training opportunities for direct care workers. 
Sec. 5303. Training in general, pediatric, and public health dentistry. 
Sec. 5304. Alternative dental health care providers demonstration project. 
Sec. 5305. Geriatric education and training; career awards; comprehensive geriatric 
education. 
Sec. 5306. Mental and behavioral health education and training grants. 
Sec. 5307. Cultural competency, prevention, and public health and individuals with 
disabilities training. 
Sec. 5308. Advanced nursing education grants. 
Sec. 5309. Nurse education, practice, and retention grants. 
Sec. 5310. Loan repayment and scholarship program. 
Sec. 5311. Nurse faculty loan program.
H. R. 3590—8 
Sec. 5312. Authorization of appropriations for parts B through D of title VIII. 
Sec. 5313. Grants to promote the community health workforce. 
Sec. 5314. Fellowship training in public health. 
Sec. 5315. United States Public Health Sciences Track. 
Subtitle E—Supporting the Existing Health Care Workforce 
Sec. 5401. Centers of excellence. 
Sec. 5402. Health care professionals training for diversity. 
Sec. 5403. Interdisciplinary, community-based linkages. 
Sec. 5404. Workforce diversity grants. 
Sec. 5405. Primary care extension program. 
Subtitle F—Strengthening Primary Care and Other Workforce Improvements 
Sec. 5501. Expanding access to primary care services and general surgery services. 
Sec. 5502. Medicare Federally qualified health center improvements. 
Sec. 5503. Distribution of additional residency positions. 
Sec. 5504. Counting resident time in nonprovider settings. 
Sec. 5505. Rules for counting resident time for didactic and scholarly activities and 
other activities. 
Sec. 5506. Preservation of resident cap positions from closed hospitals. 
Sec. 5507. Demonstration projects To address health professions workforce needs; 
extension of family-to-family health information centers. 
Sec. 5508. Increasing teaching capacity. 
Sec. 5509. Graduate nurse education demonstration. 
Subtitle G—Improving Access to Health Care Services 
Sec. 5601. Spending for Federally Qualified Health Centers (FQHCs). 
Sec. 5602. Negotiated rulemaking for development of methodology and criteria for 
designating medically underserved populations and health professions 
shortage areas. 
Sec. 5603. Reauthorization of the Wakefield Emergency Medical Services for Chil-
dren Program. 
Sec. 5604. Co-locating primary and specialty care in community-based mental 
health settings. 
Sec. 5605. Key National indicators. 
Subtitle H—General Provisions 
Sec. 5701. Reports. 
TITLE VI—TRANSPARENCY AND PROGRAM INTEGRITY 
Subtitle A—Physician Ownership and Other Transparency 
Sec. 6001. Limitation on Medicare exception to the prohibition on certain physician 
referrals for hospitals. 
Sec. 6002. Transparency reports and reporting of physician ownership or invest-
ment interests. 
Sec. 6003. Disclosure requirements for in-office ancillary services exception to the 
prohibition on physician self-referral for certain imaging services. 
Sec. 6004. Prescription drug sample transparency. 
Sec. 6005. Pharmacy benefit managers transparency requirements. 
Subtitle B—Nursing Home Transparency and Improvement 
PART I—IMPROVING TRANSPARENCY OF INFORMATION 
Sec. 6101. Required disclosure of ownership and additional disclosable parties in-
formation. 
Sec. 6102. Accountability requirements for skilled nursing facilities and nursing fa-
cilities. 
Sec. 6103. Nursing home compare Medicare website. 
Sec. 6104. Reporting of expenditures. 
Sec. 6105. Standardized complaint form. 
Sec. 6106. Ensuring staffing accountability. 
Sec. 6107. GAO study and report on Five-Star Quality Rating System. 
PART II—TARGETING ENFORCEMENT 
Sec. 6111. Civil money penalties. 
Sec. 6112. National independent monitor demonstration project. 
Sec. 6113. Notification of facility closure. 
Sec. 6114. National demonstration projects on culture change and use of informa-
tion technology in nursing homes.
H. R. 3590—9 
PART III—IMPROVING STAFF TRAINING 
Sec. 6121. Dementia and abuse prevention training. 
Subtitle C—Nationwide Program for National and State Background Checks on 
Direct Patient Access Employees of Long-term Care Facilities and Providers 
Sec. 6201. Nationwide program for National and State background checks on direct 
patient access employees of long-term care facilities and providers. 
Subtitle D—Patient-Centered Outcomes Research 
Sec. 6301. Patient-Centered Outcomes Research. 
Sec. 6302. Federal coordinating council for comparative effectiveness research. 
Subtitle E—Medicare, Medicaid, and CHIP Program Integrity Provisions 
Sec. 6401. Provider screening and other enrollment requirements under Medicare, 
Medicaid, and CHIP. 
Sec. 6402. Enhanced Medicare and Medicaid program integrity provisions. 
Sec. 6403. Elimination of duplication between the Healthcare Integrity and Protec-
tion Data Bank and the National Practitioner Data Bank. 
Sec. 6404. Maximum period for submission of Medicare claims reduced to not more 
than 12 months. 
Sec. 6405. Physicians who order items or services required to be Medicare enrolled 
physicians or eligible professionals. 
Sec. 6406. Requirement for physicians to provide documentation on referrals to pro-
grams at high risk of waste and abuse. 
Sec. 6407. Face to face encounter with patient required before physicians may cer-
tify eligibility for home health services or durable medical equipment 
under Medicare. 
Sec. 6408. Enhanced penalties. 
Sec. 6409. Medicare self-referral disclosure protocol. 
Sec. 6410. Adjustments to the Medicare durable medical equipment, prosthetics, 
orthotics, and supplies competitive acquisition program. 
Sec. 6411. Expansion of the Recovery Audit Contractor (RAC) program. 
Subtitle F—Additional Medicaid Program Integrity Provisions 
Sec. 6501. Termination of provider participation under Medicaid if terminated 
under Medicare or other State plan. 
Sec. 6502. Medicaid exclusion from participation relating to certain ownership, con-
trol, and management affiliations. 
Sec. 6503. Billing agents, clearinghouses, or other alternate payees required to reg-
ister under Medicaid. 
Sec. 6504. Requirement to report expanded set of data elements under MMIS to de-
tect fraud and abuse. 
Sec. 6505. Prohibition on payments to institutions or entities located outside of the 
United States. 
Sec. 6506. Overpayments. 
Sec. 6507. Mandatory State use of national correct coding initiative. 
Sec. 6508. General effective date. 
Subtitle G—Additional Program Integrity Provisions 
Sec. 6601. Prohibition on false statements and representations. 
Sec. 6602. Clarifying definition. 
Sec. 6603. Development of model uniform report form. 
Sec. 6604. Applicability of State law to combat fraud and abuse. 
Sec. 6605. Enabling the Department of Labor to issue administrative summary 
cease and desist orders and summary seizures orders against plans that 
are in financially hazardous condition. 
Sec. 6606. MEWA plan registration with Department of Labor. 
Sec. 6607. Permitting evidentiary privilege and confidential communications. 
Subtitle H—Elder Justice Act 
Sec. 6701. Short title of subtitle. 
Sec. 6702. Definitions. 
Sec. 6703. Elder Justice. 
Subtitle I—Sense of the Senate Regarding Medical Malpractice 
Sec. 6801. Sense of the Senate regarding medical malpractice. 
TITLE VII—IMPROVING ACCESS TO INNOVATIVE MEDICAL THERAPIES 
Subtitle A—Biologics Price Competition and Innovation 
Sec. 7001. Short title.
H. R. 3590—10 
Sec. 7002. Approval pathway for biosimilar biological products. 
Sec. 7003. Savings. 
Subtitle B—More Affordable Medicines for Children and Underserved Communities 
Sec. 7101. Expanded participation in 340B program. 
Sec. 7102. Improvements to 340B program integrity. 
Sec. 7103. GAO study to make recommendations on improving the 340B program. 
TITLE VIII—CLASS ACT 
Sec. 8001. Short title of title. 
Sec. 8002. Establishment of national voluntary insurance program for purchasing 
community living assistance services and support. 
TITLE IX—REVENUE PROVISIONS 
Subtitle A—Revenue Offset Provisions 
Sec. 9001. Excise tax on high cost employer-sponsored health coverage. 
Sec. 9002. Inclusion of cost of employer-sponsored health coverage on W–2. 
Sec. 9003. Distributions for medicine qualified only if for prescribed drug or insulin. 
Sec. 9004. Increase in additional tax on distributions from HSAs and Archer MSAs 
not used for qualified medical expenses. 
Sec. 9005. Limitation on health flexible spending arrangements under cafeteria 
plans. 
Sec. 9006. Expansion of information reporting requirements. 
Sec. 9007. Additional requirements for charitable hospitals. 
Sec. 9008. Imposition of annual fee on branded prescription pharmaceutical manu-
facturers and importers. 
Sec. 9009. Imposition of annual fee on medical device manufacturers and import-
ers. 
Sec. 9010. Imposition of annual fee on health insurance providers. 
Sec. 9011. Study and report of effect on veterans health care. 
Sec. 9012. Elimination of deduction for expenses allocable to Medicare Part D sub-
sidy. 
Sec. 9013. Modification of itemized deduction for medical expenses. 
Sec. 9014. Limitation on excessive remuneration paid by certain health insurance 
providers. 
Sec. 9015. Additional hospital insurance tax on high-income taxpayers. 
Sec. 9016. Modification of section 833 treatment of certain health organizations. 
Sec. 9017. Excise tax on elective cosmetic medical procedures. 
Subtitle B—Other Provisions 
Sec. 9021. Exclusion of health benefits provided by Indian tribal governments. 
Sec. 9022. Establishment of simple cafeteria plans for small businesses. 
Sec. 9023. Qualifying therapeutic discovery project credit. 
TITLE X—STRENGTHENING QUALITY, AFFORDABLE HEALTH CARE FOR 
ALL AMERICANS 
Subtitle A—Provisions Relating to Title I 
Sec. 10101. Amendments to subtitle A. 
Sec. 10102. Amendments to subtitle B. 
Sec. 10103. Amendments to subtitle C. 
Sec. 10104. Amendments to subtitle D. 
Sec. 10105. Amendments to subtitle E. 
Sec. 10106. Amendments to subtitle F. 
Sec. 10107. Amendments to subtitle G. 
Sec. 10108. Free choice vouchers. 
Sec. 10109. Development of standards for financial and administrative trans-
actions. 
Subtitle B—Provisions Relating to Title II 
PART I—MEDICAID AND CHIP 
Sec. 10201. Amendments to the Social Security Act and title II of this Act. 
Sec. 10202. Incentives for States to offer home and community-based services as a 
long-term care alternative to nursing homes. 
Sec. 10203. Extension of funding for CHIP through fiscal year 2015 and other 
CHIP-related provisions. 
PART II—SUPPORT FOR PREGNANT AND PARENTING TEENS AND WOMEN 
Sec. 10211. Definitions.
H. R. 3590—11 
Sec. 10212. Establishment of pregnancy assistance fund. 
Sec. 10213. Permissible uses of Fund. 
Sec. 10214. Appropriations. 
PART III—INDIAN HEALTH CARE IMPROVEMENT 
Sec. 10221. Indian health care improvement. 
Subtitle C—Provisions Relating to Title III 
Sec. 10301. Plans for a Value-Based purchasing program for ambulatory surgical 
centers. 
Sec. 10302. Revision to national strategy for quality improvement in health care. 
Sec. 10303. Development of outcome measures. 
Sec. 10304. Selection of efficiency measures. 
Sec. 10305. Data collection; public reporting. 
Sec. 10306. Improvements under the Center for Medicare and Medicaid Innovation. 
Sec. 10307. Improvements to the Medicare shared savings program. 
Sec. 10308. Revisions to national pilot program on payment bundling. 
Sec. 10309. Revisions to hospital readmissions reduction program. 
Sec. 10310. Repeal of physician payment update. 
Sec. 10311. Revisions to extension of ambulance add-ons. 
Sec. 10312. Certain payment rules for long-term care hospital services and morato-
rium on the establishment of certain hospitals and facilities. 
Sec. 10313. Revisions to the extension for the rural community hospital demonstra-
tion program. 
Sec. 10314. Adjustment to low-volume hospital provision. 
Sec. 10315. Revisions to home health care provisions. 
Sec. 10316. Medicare DSH. 
Sec. 10317. Revisions to extension of section 508 hospital provisions. 
Sec. 10318. Revisions to transitional extra benefits under Medicare Advantage. 
Sec. 10319. Revisions to market basket adjustments. 
Sec. 10320. Expansion of the scope of, and additional improvements to, the Inde-
pendent Medicare Advisory Board. 
Sec. 10321. Revision to community health teams. 
Sec. 10322. Quality reporting for psychiatric hospitals. 
Sec. 10323. Medicare coverage for individuals exposed to environmental health haz-
ards. 
Sec. 10324. Protections for frontier States. 
Sec. 10325. Revision to skilled nursing facility prospective payment system. 
Sec. 10326. Pilot testing pay-for-performance programs for certain Medicare pro-
viders. 
Sec. 10327. Improvements to the physician quality reporting system. 
Sec. 10328. Improvement in part D medication therapy management (MTM) pro-
grams. 
Sec. 10329. Developing methodology to assess health plan value. 
Sec. 10330. Modernizing computer and data systems of the Centers for Medicare & 
Medicaid services to support improvements in care delivery. 
Sec. 10331. Public reporting of performance information. 
Sec. 10332. Availability of medicare data for performance measurement. 
Sec. 10333. Community-based collaborative care networks. 
Sec. 10334. Minority health. 
Sec. 10335. Technical correction to the hospital value-based purchasing program. 
Sec. 10336. GAO study and report on Medicare beneficiary access to high-quality 
dialysis services. 
Subtitle D—Provisions Relating to Title IV 
Sec. 10401. Amendments to subtitle A. 
Sec. 10402. Amendments to subtitle B. 
Sec. 10403. Amendments to subtitle C. 
Sec. 10404. Amendments to subtitle D. 
Sec. 10405. Amendments to subtitle E. 
Sec. 10406. Amendment relating to waiving coinsurance for preventive services. 
Sec. 10407. Better diabetes care. 
Sec. 10408. Grants for small businesses to provide comprehensive workplace 
wellness programs. 
Sec. 10409. Cures Acceleration Network. 
Sec. 10410. Centers of Excellence for Depression. 
Sec. 10411. Programs relating to congenital heart disease. 
Sec. 10412. Automated Defibrillation in Adam’s Memory Act. 
Sec. 10413. Young women’s breast health awareness and support of young women 
diagnosed with breast cancer. 
Subtitle E—Provisions Relating to Title V 
Sec. 10501. Amendments to the Public Health Service Act, the Social Security Act, 
and title V of this Act.
H. R. 3590—12 
Sec. 10502. Infrastructure to Expand Access to Care. 
Sec. 10503. Community Health Centers and the National Health Service Corps 
Fund. 
Sec. 10504. Demonstration project to provide access to affordable care. 
Subtitle F—Provisions Relating to Title VI 
Sec. 10601. Revisions to limitation on medicare exception to the prohibition on cer-
tain physician referrals for hospitals. 
Sec. 10602. Clarifications to patient-centered outcomes research. 
Sec. 10603. Striking provisions relating to individual provider application fees. 
Sec. 10604. Technical correction to section 6405. 
Sec. 10605. Certain other providers permitted to conduct face to face encounter for 
home health services. 
Sec. 10606. Health care fraud enforcement. 
Sec. 10607. State demonstration programs to evaluate alternatives to current med-
ical tort litigation. 
Sec. 10608. Extension of medical malpractice coverage to free clinics. 
Sec. 10609. Labeling changes. 
Subtitle G—Provisions Relating to Title VIII 
Sec. 10801. Provisions relating to title VIII. 
Subtitle H—Provisions Relating to Title IX 
Sec. 10901. Modifications to excise tax on high cost employer-sponsored health cov-
erage. 
Sec. 10902. Inflation adjustment of limitation on health flexible spending arrange-
ments under cafeteria plans. 
Sec. 10903. Modification of limitation on charges by charitable hospitals. 
Sec. 10904. Modification of annual fee on medical device manufacturers and im-
porters. 
Sec. 10905. Modification of annual fee on health insurance providers. 
Sec. 10906. Modifications to additional hospital insurance tax on high-income tax-
payers. 
Sec. 10907. Excise tax on indoor tanning services in lieu of elective cosmetic med-
ical procedures. 
Sec. 10908. Exclusion for assistance provided to participants in State student loan 
repayment programs for certain health professionals. 
Sec. 10909. Expansion of adoption credit and adoption assistance programs. 
TITLE I—QUALITY, AFFORDABLE 
HEALTH CARE FOR ALL AMERICANS 
Subtitle A—Immediate Improvements in 
Health Care Coverage for All Americans 
SEC. 1001. AMENDMENTS TO THE PUBLIC HEALTH SERVICE ACT. 
Part A of title XXVII of the Public Health Service Act (42 
U.S.C. 300gg et seq.) is amended— 
(1) by striking the part heading and inserting the following: 
‘‘PART A—INDIVIDUAL AND GROUP MARKET 
REFORMS’’; 
(2) by redesignating sections 2704 through 2707 as sections 
2725 through 2728, respectively; 
(3) by redesignating sections 2711 through 2713 as sections 
2731 through 2733, respectively; 
(4) by redesignating sections 2721 through 2723 as sections 
2735 through 2737, respectively; and 
(5) by inserting after section 2702, the following:
H. R. 3590—13 
‘‘Subpart II—Improving Coverage 
‘‘SEC. 2711. NO LIFETIME OR ANNUAL LIMITS. 
‘‘(a) IN GENERAL.—A group health plan and a health insurance 
issuer offering group or individual health insurance coverage may 
not establish— 
‘‘(1) lifetime limits on the dollar value of benefits for any 
participant or beneficiary; or 
‘‘(2) unreasonable annual limits (within the meaning of 
section 223 of the Internal Revenue Code of 1986) on the 
dollar value of benefits for any participant or beneficiary. 
‘‘(b) PER BENEFICIARY LIMITS.—Subsection (a) shall not be con-
strued to prevent a group health plan or health insurance coverage 
that is not required to provide essential health benefits under 
section 1302(b) of the Patient Protection and Affordable Care Act 
from placing annual or lifetime per beneficiary limits on specific 
covered benefits to the extent that such limits are otherwise per-
mitted under Federal or State law. 
‘‘SEC. 2712. PROHIBITION ON RESCISSIONS. 
‘‘A group health plan and a health insurance issuer offering 
group or individual health insurance coverage shall not rescind 
such plan or coverage with respect to an enrollee once the enrollee 
is covered under such plan or coverage involved, except that this 
section shall not apply to a covered individual who has performed 
an act or practice that constitutes fraud or makes an intentional 
misrepresentation of material fact as prohibited by the terms of 
the plan or coverage. Such plan or coverage may not be cancelled 
except with prior notice to the enrollee, and only as permitted 
under section 2702(c) or 2742(b). 
‘‘SEC. 2713. COVERAGE OF PREVENTIVE HEALTH SERVICES. 
‘‘(a) IN GENERAL.—A group health plan and a health insurance 
issuer offering group or individual health insurance coverage shall, 
at a minimum provide coverage for and shall not impose any 
cost sharing requirements for— 
‘‘(1) evidence-based items or services that have in effect 
a rating of ‘A’ or ‘B’ in the current recommendations of the 
United States Preventive Services Task Force; 
‘‘(2) immunizations that have in effect a recommendation 
from the Advisory Committee on Immunization Practices of 
the Centers for Disease Control and Prevention with respect 
to the individual involved; and 
‘‘(3) with respect to infants, children, and adolescents, evi-
dence-informed preventive care and screenings provided for 
in the comprehensive guidelines supported by the Health 
Resources and Services Administration. 
‘‘(4) with respect to women, such additional preventive 
care and screenings not described in paragraph (1) as provided 
for in comprehensive guidelines supported by the Health 
Resources and Services Administration for purposes of this 
paragraph. 
‘‘(5) for the purposes of this Act, and for the purposes 
of any other provision of law, the current recommendations 
of the United States Preventive Service Task Force regarding 
breast cancer screening, mammography, and prevention shall
H. R. 3590—14 
be considered the most current other than those issued in 
or around November 2009. 
Nothing in this subsection shall be construed to prohibit a plan 
or issuer from providing coverage for services in addition to those 
recommended by United States Preventive Services Task Force 
or to deny coverage for services that are not recommended by 
such Task Force. 
‘‘(b) INTERVAL.— 
‘‘(1) IN GENERAL.—The Secretary shall establish a minimum 
interval between the date on which a recommendation described 
in subsection (a)(1) or (a)(2) or a guideline under subsection 
(a)(3) is issued and the plan year with respect to which the 
requirement described in subsection (a) is effective with respect 
to the service described in such recommendation or guideline. 
‘‘(2) MINIMUM.—The interval described in paragraph (1) 
shall not be less than 1 year. 
‘‘(c) VALUE-BASED INSURANCE DESIGN.—The Secretary may 
develop guidelines to permit a group health plan and a health 
insurance issuer offering group or individual health insurance cov-
erage to utilize value-based insurance designs. 
‘‘SEC. 2714. EXTENSION OF DEPENDENT COVERAGE. 
‘‘(a) IN GENERAL.—A group health plan and a health insurance 
issuer offering group or individual health insurance coverage that 
provides dependent coverage of children shall continue to make 
such coverage available for an adult child (who is not married) 
until the child turns 26 years of age. Nothing in this section shall 
require a health plan or a health insurance issuer described in 
the preceding sentence to make coverage available for a child of 
a child receiving dependent coverage. 
‘‘(b) REGULATIONS.—The Secretary shall promulgate regulations 
to define the dependents to which coverage shall be made available 
under subsection (a). 
‘‘(c) RULE
OF CONSTRUCTION.—Nothing in this section shall 
be construed to modify the definition of ‘dependent’ as used in 
the Internal Revenue Code of 1986 with respect to the tax treatment 
of the cost of coverage. 
‘‘SEC. 2715. DEVELOPMENT AND UTILIZATION OF UNIFORM EXPLA-
NATION OF COVERAGE DOCUMENTS AND STANDARDIZED 
DEFINITIONS. 
‘‘(a) IN GENERAL.—Not later than 12 months after the date 
of enactment of the Patient Protection and Affordable Care Act, 
the Secretary shall develop standards for use by a group health 
plan and a health insurance issuer offering group or individual 
health insurance coverage, in compiling and providing to enrollees 
a summary of benefits and coverage explanation that accurately 
describes the benefits and coverage under the applicable plan or 
coverage. In developing such standards, the Secretary shall consult 
with the National Association of Insurance Commissioners (referred 
to in this section as the ‘NAIC’), a working group composed of 
representatives of health insurance-related consumer advocacy 
organizations, health insurance issuers, health care professionals, 
patient advocates including those representing individuals with lim-
ited English proficiency, and other qualified individuals. 
‘‘(b) REQUIREMENTS.—The standards for the summary of bene-
fits and coverage developed under subsection (a) shall provide for 
the following:
H. R. 3590—15 
‘‘(1) APPEARANCE.—The standards shall ensure that the 
summary of benefits and coverage is presented in a uniform 
format that does not exceed 4 pages in length and does not 
include print smaller than 12-point font. 
‘‘(2) LANGUAGE.—The standards shall ensure that the sum-
mary is presented in a culturally and linguistically appropriate 
manner and utilizes terminology understandable by the average 
plan enrollee. 
‘‘(3) CONTENTS.—The standards shall ensure that the sum-
mary of benefits and coverage includes— 
‘‘(A) uniform definitions of standard insurance terms 
and medical terms (consistent with subsection (g)) so that 
consumers may compare health insurance coverage and 
understand the terms of coverage (or exception to such 
coverage); 
‘‘(B) a description of the coverage, including cost 
sharing for— 
‘‘(i) each of the categories of the essential health 
benefits described in subparagraphs (A) through (J) 
of section 1302(b)(1) of the Patient Protection and 
Affordable Care Act; and 
‘‘(ii) other benefits, as identified by the Secretary; 
‘‘(C) the exceptions, reductions, and limitations on cov-
erage; 
‘‘(D) the cost-sharing provisions, including deductible, 
coinsurance, and co-payment obligations; 
‘‘(E) the renewability and continuation of coverage 
provisions; 
‘‘(F) a coverage facts label that includes examples to 
illustrate common benefits scenarios, including pregnancy 
and serious or chronic medical conditions and related cost 
sharing, such scenarios to be based on recognized clinical 
practice guidelines; 
‘‘(G) a statement of whether the plan or coverage— 
‘‘(i) provides minimum essential coverage (as 
defined under section 5000A(f) of the Internal Revenue 
Code 1986); and 
‘‘(ii) ensures that the plan or coverage share of 
the total allowed costs of benefits provided under the 
plan or coverage is not less than 60 percent of such 
costs; 
‘‘(H) a statement that the outline is a summary of 
the policy or certificate and that the coverage document 
itself should be consulted to determine the governing 
contractual provisions; and 
‘‘(I) a contact number for the consumer to call with 
additional questions and an Internet web address where 
a copy of the actual individual coverage policy or group 
certificate of coverage can be reviewed and obtained. 
‘‘(c) PERIODIC REVIEW
AND UPDATING.—The Secretary shall 
periodically review and update, as appropriate, the standards devel-
oped under this section. 
‘‘(d) REQUIREMENT TO PROVIDE.— 
‘‘(1) IN GENERAL.—Not later than 24 months after the date 
of enactment of the Patient Protection and Affordable Care 
Act, each entity described in paragraph (3) shall provide, prior
H. R. 3590—16 
to any enrollment restriction, a summary of benefits and cov-
erage explanation pursuant
to the standards developed by 
the Secretary under subsection (a) to— 
‘‘(A) an applicant at the time of application; 
‘‘(B) an enrollee prior to the time of enrollment or 
reenrollment, as applicable; and 
‘‘(C) a policyholder or certificate holder at the time 
of issuance of the policy or delivery of the certificate. 
‘‘(2) COMPLIANCE.—An entity described in paragraph (3) 
is deemed to be in compliance with this section if the summary 
of benefits and coverage described in subsection (a) is provided 
in paper or electronic form. 
‘‘(3) ENTITIES
IN
GENERAL.—An entity described in this 
paragraph is— 
‘‘(A) a health insurance issuer (including a group health 
plan that is not a self-insured plan) offering health insur-
ance coverage within the United States; or 
‘‘(B) in the case of a self-insured group health plan, 
the plan sponsor or designated administrator of the plan 
(as such terms are defined in section 3(16) of the Employee 
Retirement Income Security Act of 1974). 
‘‘(4) NOTICE OF MODIFICATIONS.—If a group health plan 
or health insurance issuer makes any material modification 
in any of the terms of the plan or coverage involved (as defined 
for purposes of section 102 of the Employee Retirement Income 
Security Act of 1974) that is not reflected in the most recently 
provided summary of benefits and coverage, the plan or issuer 
shall provide notice of such modification to enrollees not later 
than 60 days prior to the date on which such modification 
will become effective. 
‘‘(e) PREEMPTION.—The standards developed under subsection 
(a) shall preempt any related State standards that require a sum-
mary of benefits and coverage that provides less information to 
consumers than that required to be provided under this section, 
as determined by the Secretary. 
‘‘(f) FAILURE TO PROVIDE.—An entity described in subsection 
(d)(3) that willfully fails to provide the information required under 
this section shall be subject to a fine of not more than $1,000 
for each such failure. Such failure with respect to each enrollee 
shall constitute a separate offense for purposes of this subsection. 
‘‘(g) DEVELOPMENT OF STANDARD DEFINITIONS.— 
‘‘(1) IN GENERAL.—The Secretary shall, by regulation, pro-
vide for the development of standards for the definitions of 
terms used in health insurance coverage, including the insur-
ance-related terms described in paragraph (2) and the medical 
terms described in paragraph (3). 
‘‘(2) INSURANCE-RELATED
TERMS.—The insurance-related 
terms described in this paragraph are premium, deductible, 
co-insurance, co-payment, out-of-pocket limit, preferred pro-
vider, non-preferred provider, out-of-network co-payments, UCR 
(usual, customary and reasonable) fees, excluded services, griev-
ance and appeals, and such other terms as the Secretary deter-
mines are important to define so that consumers may compare 
health insurance coverage and understand the terms of their 
coverage.
H. R. 3590—17 
‘‘(3) MEDICAL TERMS.—The medical terms described in this 
paragraph are hospitalization, hospital outpatient care, emer-
gency room care, physician services, prescription drug coverage, 
durable medical equipment, home health care, skilled nursing 
care, rehabilitation services, hospice services, emergency med-
ical transportation, and such other terms as the Secretary 
determines are important to define so that consumers may 
compare the medical benefits offered by health insurance and 
understand the extent of those medical benefits (or exceptions 
to those benefits). 
‘‘SEC. 2716. PROHIBITION OF DISCRIMINATION BASED ON SALARY. 
‘‘(a) IN GENERAL.—The plan sponsor of a group health plan 
(other than a self-insured plan) may not establish rules relating 
to the health insurance coverage eligibility (including continued 
eligibility) of any full-time employee under the terms of the plan 
that are based on the total hourly or annual salary of the employee 
or otherwise establish eligibility rules that have the effect of 
discriminating in favor of higher wage employees. 
‘‘(b) LIMITATION.—Subsection (a) shall not be construed to pro-
hibit a plan sponsor from establishing contribution requirements 
for enrollment in the plan or coverage that provide for the payment 
by employees with lower hourly or annual compensation of a lower 
dollar or percentage contribution than the payment required of 
similarly situated employees with a higher hourly or annual com-
pensation. 
‘‘SEC. 2717. ENSURING THE QUALITY OF CARE. 
‘‘(a) QUALITY REPORTING.— 
‘‘(1) IN GENERAL.—Not later than 2 years after the date 
of enactment of the Patient Protection and Affordable Care 
Act, the Secretary, in consultation with experts in health care 
quality and stakeholders, shall develop reporting requirements 
for use by a group health plan, and a health insurance issuer 
offering group or individual health insurance coverage, with 
respect to plan or coverage benefits and health care provider 
reimbursement structures that— 
‘‘(A) improve health outcomes through the implementa-
tion of activities such as quality reporting, effective case 
management, care coordination, chronic disease manage-
ment, and medication and care compliance initiatives, 
including through the use of the medical homes model 
as defined for purposes of section 3602 of the Patient 
Protection and Affordable Care Act, for treatment or serv-
ices under the plan or coverage; 
‘‘(B) implement activities to prevent hospital readmis-
sions through a comprehensive program for hospital dis-
charge that includes patient-centered education and coun-
seling, comprehensive discharge planning, and post dis-
charge reinforcement by an appropriate health care profes-
sional; 
‘‘(C) implement activities to improve patient safety and 
reduce medical errors through the appropriate use of best 
clinical practices, evidence based medicine, and health 
information technology under the plan or coverage; and 
‘‘(D) implement wellness and health promotion activi-
ties. 
‘‘(2) REPORTING REQUIREMENTS.—
H. R. 3590—18 
‘‘(A) IN GENERAL.—A group health plan and a health 
insurance issuer offering group or individual health insur-
ance coverage shall annually submit to the Secretary, and 
to enrollees under the plan or coverage, a report on whether 
the benefits under the plan or coverage satisfy the elements 
described in subparagraphs (A) through (D) of paragraph 
(1). 
‘‘(B) TIMING
OF
REPORTS.—A report under subpara-
graph (A) shall be made available to an enrollee under 
the plan or coverage during each open enrollment period. 
‘‘(C) AVAILABILITY OF REPORTS.—The Secretary shall 
make reports submitted under subparagraph (A) available 
to the public through an Internet website. 
‘‘(D) PENALTIES.—In developing the reporting require-
ments under paragraph (1), the Secretary may develop 
and impose appropriate penalties for non-compliance with 
such requirements. 
‘‘(E) EXCEPTIONS.—In developing the reporting require-
ments under paragraph (1), the Secretary may provide 
for exceptions to such requirements for group health plans 
and health insurance issuers that substantially meet the 
goals of this section. 
‘‘(b) WELLNESS AND PREVENTION PROGRAMS.—For purposes of 
subsection (a)(1)(D), wellness and health promotion activities may 
include personalized wellness and prevention services, which are 
coordinated, maintained or delivered by a health care provider, 
a wellness and prevention plan manager, or a health, wellness 
or prevention services organization that conducts health risk assess-
ments or offers ongoing face-to-face, telephonic or web-based inter-
vention efforts for each of the program’s participants, and which 
may include the following wellness and prevention efforts: 
‘‘(1) Smoking cessation. 
‘‘(2) Weight management. 
‘‘(3) Stress management. 
‘‘(4) Physical fitness. 
‘‘(5) Nutrition. 
‘‘(6) Heart disease prevention. 
‘‘(7) Healthy lifestyle support. 
‘‘(8) Diabetes prevention. 
‘‘(c) REGULATIONS.—Not later than 2 years after the date of 
enactment of the Patient Protection and Affordable Care Act, the 
Secretary shall promulgate regulations that provide criteria for 
determining whether a reimbursement structure is described in 
subsection (a). 
‘‘(d) STUDY AND REPORT.—Not later than 180 days after the 
date on which regulations are promulgated under subsection (c), 
the Government Accountability Office shall review such regulations 
and conduct a study and submit to the Committee on Health, 
Education, Labor, and Pensions of the Senate and the Committee 
on Energy and Commerce of the House of Representatives a report 
regarding the impact the activities under this section have had 
on the quality and cost of health care. 
‘‘SEC. 2718. BRINGING DOWN THE COST OF HEALTH CARE COVERAGE. 
‘‘(a) CLEAR ACCOUNTING FOR COSTS.—A health insurance issuer 
offering group or individual health insurance coverage shall, with
H. R. 3590—19 
respect to each plan year, submit to the Secretary a report con-
cerning the percentage of total premium revenue that such coverage 
expends— 
‘‘(1) on reimbursement for clinical services provided to 
enrollees under such coverage; 
‘‘(2) for activities that improve health care quality; and 
‘‘(3) on all other non-claims costs, including an explanation 
of the nature of such costs, and excluding State taxes and 
licensing or regulatory fees. 
The Secretary shall make reports received under this section avail-
able to the public on the Internet website of the Department of 
Health and Human Services. 
‘‘(b) ENSURING THAT CONSUMERS RECEIVE VALUE FOR THEIR 
PREMIUM PAYMENTS.— 
‘‘(1) REQUIREMENT TO PROVIDE VALUE FOR PREMIUM PAY-
MENTS.—A health insurance issuer offering group or individual 
health insurance coverage shall, with respect to each plan 
year, provide an annual rebate to each enrollee under such 
coverage, on a pro rata basis, in an amount that is equal 
to the amount by which premium revenue expended by the 
issuer on activities described in subsection (a)(3) exceeds— 
‘‘(A) with respect to a health insurance issuer offering 
coverage in the group market, 20 percent, or such lower 
percentage as a State may by regulation determine; or 
‘‘(B) with respect to a health insurance issuer offering 
coverage in the individual market, 25 percent, or such 
lower percentage as a State may by regulation determine, 
except that such percentage shall be adjusted to the extent 
the Secretary determines that the application of such 
percentage with a State may destabilize the existing indi-
vidual market in such State. 
‘‘(2) CONSIDERATION IN SETTING PERCENTAGES.—In deter-
mining the percentages under paragraph (1), a State shall 
seek to ensure adequate participation by health insurance 
issuers, competition in the health insurance market in the 
State, and value for consumers so that premiums are used 
for clinical services and quality improvements. 
‘‘(3) TERMINATION.—The provisions of this subsection shall 
have no force or effect after December 31, 2013. 
‘‘(c) STANDARD HOSPITAL CHARGES.—Each hospital operating 
within the United States shall for each year establish (and update) 
and make public (in accordance with guidelines developed by the 
Secretary) a list of the hospital’s standard charges for items and 
services provided by the hospital, including for diagnosis-related 
groups established under section 1886(d)(4) of the Social Security 
Act. 
‘‘(d) DEFINITIONS.—The Secretary, in consultation with the 
National Association of Insurance Commissions, shall establish uni-
form definitions for the activities reported under subsection (a). 
‘‘SEC. 2719. APPEALS PROCESS. 
‘‘A group health plan and a health insurance issuer offering 
group or individual health insurance coverage shall implement an 
effective appeals process for appeals of coverage determinations 
and claims, under which the plan or issuer shall, at a minimum— 
‘‘(1) have in effect an internal claims appeal process;
H. R. 3590—20 
‘‘(2) provide notice to enrollees, in a culturally and linguis-
tically appropriate manner, of available internal and external 
appeals processes, and the availability of any applicable office 
of health insurance consumer assistance or ombudsman estab-
lished under section 2793 to assist such enrollees with the 
appeals processes; 
‘‘(3) allow an enrollee to review their file, to present evi-
dence and testimony as part of the appeals process, and to 
receive continued coverage pending the outcome of the appeals 
process; and 
‘‘(4) provide an external review process for such plans and 
issuers that, at a minimum, includes the consumer protections 
set forth in the Uniform External Review Model Act promul-
gated by the National Association of Insurance Commissioners 
and is binding on such plans.’’. 
SEC. 1002. HEALTH INSURANCE CONSUMER INFORMATION. 
Part C of title XXVII of the Public Health Service Act (42 
U.S.C. 300gg–91 et seq.) is amended by adding at the end the 
following: 
‘‘SEC. 2793. HEALTH INSURANCE CONSUMER INFORMATION. 
‘‘(a) IN GENERAL.—The Secretary shall award grants to States 
to enable such States (or the Exchanges operating in such States) 
to establish, expand, or provide support for— 
‘‘(1) offices of health insurance consumer assistance; or 
‘‘(2) health insurance ombudsman programs. 
‘‘(b) ELIGIBILITY.— 
‘‘(1) IN GENERAL.—To be eligible to receive a grant, a State 
shall designate an independent office of health insurance con-
sumer assistance, or an ombudsman, that, directly or in 
coordination with State health insurance regulators and con-
sumer assistance organizations, receives and responds to 
inquiries and complaints concerning health insurance coverage 
with respect to Federal health insurance requirements and 
under State law. 
‘‘(2) CRITERIA.—A State that receives a grant under this 
section shall comply with criteria established by the Secretary 
for carrying out activities under such grant. 
‘‘(c) DUTIES.—The office of health insurance consumer assist-
ance or health insurance ombudsman shall— 
‘‘(1) assist with the filing of complaints and appeals, 
including filing appeals with the internal appeal or grievance 
process of the group health plan or health insurance issuer 
involved and providing information about the external appeal 
process; 
‘‘(2) collect, track, and quantify problems and inquiries 
encountered by consumers; 
‘‘(3) educate consumers on their rights and responsibilities 
with respect to group health plans and health insurance cov-
erage; 
‘‘(4) assist consumers with enrollment in a group health 
plan or health insurance coverage by providing information, 
referral, and assistance; and 
‘‘(5) resolve problems with obtaining premium tax credits 
under section 36B of the Internal Revenue Code of 1986.
H. R. 3590—21 
‘‘(d) DATA COLLECTION.—As a condition of receiving a grant 
under subsection (a), an office of health insurance consumer assist-
ance or ombudsman program shall be required to collect and report 
data to the Secretary on the types of problems and inquiries encoun-
tered by consumers. The Secretary shall utilize such data to identify 
areas where more enforcement action is necessary and shall share 
such information with State insurance regulators, the Secretary 
of Labor, and the Secretary of the Treasury for use in the enforce-
ment activities of such agencies. 
‘‘(e) FUNDING.— 
‘‘(1) INITIAL
FUNDING.—There is hereby appropriated to 
the Secretary, out of any funds in the Treasury not otherwise 
appropriated, $30,000,000 for the first fiscal year for which 
this section applies to carry out this section. Such amount 
shall remain available without fiscal year limitation. 
‘‘(2) AUTHORIZATION
FOR
SUBSEQUENT
YEARS.—There is 
authorized to be appropriated to the Secretary for each fiscal 
year following the fiscal year described in paragraph (1), such 
sums as may be necessary to carry out this section.’’. 
SEC. 1003. ENSURING THAT CONSUMERS GET VALUE FOR THEIR DOL-
LARS. 
Part C of title XXVII of the Public Health Service Act (42 
U.S.C. 300gg–91 et seq.), as amended by section 1002, is further 
amended by adding at the end the following: 
‘‘SEC. 2794. ENSURING THAT CONSUMERS GET VALUE FOR THEIR DOL-
LARS. 
‘‘(a) INITIAL PREMIUM REVIEW PROCESS.— 
‘‘(1) IN
GENERAL.—The Secretary, in conjunction with 
States, shall establish a process for the annual review, begin-
ning with the 2010 plan year and subject to subsection (b)(2)(A), 
of unreasonable increases in premiums for health insurance 
coverage. 
‘‘(2) JUSTIFICATION AND DISCLOSURE.—The process estab-
lished under paragraph (1) shall require health insurance 
issuers to submit to the Secretary and the relevant State a 
justification for an unreasonable premium increase prior to 
the implementation of the increase. Such issuers shall promi-
nently post such information on their Internet websites. The 
Secretary shall ensure the public disclosure of information on 
such increases and justifications for all health insurance 
issuers. 
‘‘(b) CONTINUING PREMIUM REVIEW PROCESS.— 
‘‘(1) INFORMING
SECRETARY
OF
PREMIUM
INCREASE
PAT-
TERNS.—As a condition of receiving a grant under subsection 
(c)(1), a State, through its Commissioner of Insurance, shall— 
‘‘(A) provide the Secretary with information about 
trends in premium increases in health insurance coverage 
in premium rating areas in the State; and 
‘‘(B) make recommendations, as appropriate, to the 
State Exchange about whether particular health insurance 
issuers should be excluded from participation in the 
Exchange based on a pattern or practice of excessive or 
unjustified premium increases. 
‘‘(2) MONITORING BY SECRETARY OF PREMIUM INCREASES.— 
‘‘(A) IN GENERAL.—Beginning with plan years begin-
ning in 2014, the Secretary, in conjunction with the States
H. R. 3590—22 
and consistent with the provisions of subsection (a)(2), shall 
monitor premium increases of health insurance coverage 
offered through an Exchange and outside of an Exchange. 
‘‘(B) CONSIDERATION IN OPENING EXCHANGE.—In deter-
mining under section 1312(f)(2)(B) of the Patient Protection 
and Affordable Care Act whether to offer qualified health 
plans in the large group market through an Exchange, 
the State shall take into account any excess of premium 
growth outside of the Exchange as compared to the rate 
of such growth inside the Exchange. 
‘‘(c) GRANTS IN SUPPORT OF PROCESS.— 
‘‘(1) PREMIUM REVIEW GRANTS DURING 2010 THROUGH 2014.— 
The Secretary shall carry out a program to award grants to 
States during the 5-year period beginning with fiscal year 2010 
to assist such States in carrying out subsection (a), including— 
‘‘(A) in reviewing and, if appropriate under State law, 
approving premium increases for health insurance cov-
erage; and 
‘‘(B) in providing information and recommendations 
to the Secretary under subsection (b)(1). 
‘‘(2) FUNDING.— 
‘‘(A) IN GENERAL.—Out of all funds in the Treasury 
not otherwise appropriated, there are appropriated to the 
Secretary $250,000,000, to be available for expenditure for 
grants under paragraph (1) and subparagraph (B). 
‘‘(B) FURTHER
AVAILABILITY
FOR
INSURANCE
REFORM 
AND CONSUMER PROTECTION.—If the amounts appropriated 
under subparagraph (A) are not fully obligated under 
grants under paragraph (1) by the end of fiscal year 2014, 
any remaining funds shall remain available to the Sec-
retary for grants to States for planning and implementing 
the insurance reforms and consumer protections under part 
A. 
‘‘(C) ALLOCATION.—The Secretary shall establish a for-
mula for determining the amount of any grant to a State 
under this subsection. Under such formula— 
‘‘(i) the Secretary shall consider the number of 
plans of health insurance coverage offered in each State 
and the population of the State; and 
‘‘(ii) no State qualifying for a grant under para-
graph (1) shall receive less than $1,000,000, or more 
than $5,000,000 for a grant year.’’. 
SEC. 1004. EFFECTIVE DATES. 
(a) IN GENERAL.—Except as provided for in subsection (b), 
this subtitle (and the amendments made by this subtitle) shall 
become effective for plan years beginning on or after the date 
that is 6 months after the date of enactment of this Act, except 
that the amendments made by sections 1002 and 1003 shall become 
effective for fiscal years beginning with fiscal year 2010. 
(b) SPECIAL RULE.—The amendments made by sections 1002 
and 1003 shall take effect on the date of enactment of this Act.
H. R. 3590—23 
Subtitle B—Immediate Actions to Preserve 
and Expand Coverage 
SEC. 1101. IMMEDIATE ACCESS TO INSURANCE FOR UNINSURED 
INDIVIDUALS WITH A PREEXISTING CONDITION. 
(a) IN GENERAL.—Not later than 90 days after the date of 
enactment of this Act, the Secretary shall establish a temporary 
high risk health insurance pool program to provide health insurance 
coverage for eligible individuals during the period beginning on 
the date on which such program is established and ending on 
January 1, 2014. 
(b) ADMINISTRATION.— 
(1) IN GENERAL.—The Secretary may carry out the program 
under this section directly or through contracts to eligible enti-
ties. 
(2) ELIGIBLE ENTITIES.—To be eligible for a contract under 
paragraph (1), an entity shall— 
(A) be a State or nonprofit private entity; 
(B) submit to the Secretary an application at such 
time, in such manner, and containing such information 
as the Secretary may require; and 
(C) agree to utilize contract funding to establish and 
administer a qualified high risk pool for eligible individuals. 
(3) MAINTENANCE OF EFFORT.—To be eligible to enter into 
a contract with the Secretary under this subsection, a State 
shall agree not to reduce the annual amount the State expended 
for the operation of one or more State high risk pools during 
the year preceding the year in which such contract is entered 
into. 
(c) QUALIFIED HIGH RISK POOL.— 
(1) IN GENERAL.—Amounts made available under this sec-
tion shall be used to establish a qualified high risk pool that 
meets the requirements of paragraph (2). 
(2) REQUIREMENTS.—A qualified high risk pool meets the 
requirements of this paragraph if such pool— 
(A) provides to all eligible individuals health insurance 
coverage that does not impose any preexisting condition 
exclusion with respect to such coverage; 
(B) provides health insurance coverage— 
(i) in which the issuer’s share of the total allowed 
costs of benefits provided under such coverage is not 
less than 65 percent of such costs; and 
(ii) that has an out of pocket limit not greater 
than the applicable amount described in section 
223(c)(2) of the Internal Revenue Code of 1986 for 
the year involved, except that the Secretary may 
modify such limit if necessary to ensure the pool meets 
the actuarial value limit under clause (i); 
(C) ensures that with respect to the premium rate 
charged for health insurance coverage offered to eligible 
individuals through the high risk pool, such rate shall— 
(i) except as provided in clause (ii), vary only as 
provided for under section 2701 of the Public Health 
Service Act (as amended by this Act and notwith-
standing the date on which such amendments take 
effect);
H. R. 3590—24 
(ii) vary on the basis of age by a factor of not 
greater than 4 to 1; and 
(iii) be established at a standard rate for a 
standard population; and 
(D) meets any other requirements determined appro-
priate by the Secretary. 
(d) ELIGIBLE INDIVIDUAL.—An individual shall be deemed to 
be an eligible individual for purposes of this section if such indi-
vidual— 
(1) is a citizen or national of the United States or is 
lawfully present in the United States (as determined in accord-
ance with section 1411); 
(2) has not been covered under creditable coverage (as 
defined in section 2701(c)(1) of the Public Health Service Act 
as in effect on the date of enactment of this Act) during the 
6-month period prior to the date on which such individual 
is applying for coverage through the high risk pool; and 
(3) has a pre-existing condition, as determined in a manner 
consistent with guidance issued by the Secretary. 
(e) PROTECTION AGAINST DUMPING RISK BY INSURERS.— 
(1) IN GENERAL.—The Secretary shall establish criteria for 
determining whether health insurance issuers and employment- 
based health plans have discouraged an individual from 
remaining enrolled in prior coverage based on that individual’s 
health status. 
(2) SANCTIONS.—An issuer or employment-based health 
plan shall be responsible for reimbursing the program under 
this section for the medical expenses incurred by the program 
for an individual who, based on criteria established by the 
Secretary, the Secretary finds was encouraged by the issuer 
to disenroll from health benefits coverage prior to enrolling 
in coverage through the program. The criteria shall include 
at least the following circumstances: 
(A) In the case of prior coverage obtained through 
an employer, the provision by the employer, group health 
plan, or the issuer of money or other financial consideration 
for disenrolling from the coverage. 
(B) In the case of prior coverage obtained directly from 
an issuer or under an employment-based health plan— 
(i) the provision by the issuer or plan of money 
or other financial consideration for disenrolling from 
the coverage; or 
(ii) in the case of an individual whose premium 
for the prior coverage exceeded the premium required 
by the program (adjusted based on the age factors 
applied to the prior coverage)— 
(I) the prior coverage is a policy that is no 
longer being actively marketed (as defined by the 
Secretary) by the issuer; or 
(II) the prior coverage is a policy for which 
duration of coverage form issue or health status 
are factors that can be considered in determining 
premiums at renewal. 
(3) CONSTRUCTION.—Nothing in this subsection shall be 
construed as constituting exclusive remedies for violations of 
criteria established under paragraph (1) or as preventing States
H. R. 3590—25 
from applying or enforcing such paragraph or other provisions 
under law with respect to health insurance issuers. 
(f) OVERSIGHT.—The Secretary shall establish— 
(1) an appeals process to enable individuals to appeal a 
determination under this section; and 
(2) procedures to protect against waste, fraud, and abuse. 
(g) FUNDING; TERMINATION OF AUTHORITY.— 
(1) IN GENERAL.—There is appropriated to the Secretary, 
out of any moneys in the Treasury not otherwise appropriated, 
$5,000,000,000 to pay claims against (and the administrative 
costs of) the high risk pool under this section that are in 
excess of the amount of premiums collected from eligible 
individuals enrolled in the high risk pool. Such funds shall 
be available without fiscal year limitation. 
(2) INSUFFICIENT FUNDS.—If the Secretary estimates for 
any fiscal year that the aggregate amounts available for the 
payment of the expenses of the high risk pool will be less 
than the actual amount of such expenses, the Secretary shall 
make such adjustments as are necessary to eliminate such 
deficit. 
(3) TERMINATION OF AUTHORITY.— 
(A) IN GENERAL.—Except as provided in subparagraph 
(B), coverage of eligible individuals under a high risk pool 
in a State shall terminate on January 1, 2014. 
(B) TRANSITION
TO
EXCHANGE.—The Secretary shall 
develop procedures to provide for the transition of eligible 
individuals enrolled in health insurance coverage offered 
through a high risk pool established under this section 
into qualified health plans offered through an Exchange. 
Such procedures shall ensure that there is no lapse in 
coverage with respect to the individual and may extend 
coverage after the termination of the risk pool involved, 
if the Secretary determines necessary to avoid such a lapse. 
(4) LIMITATIONS.—The Secretary has the authority to stop 
taking applications for participation in the program under this 
section to comply with the funding limitation provided for in 
paragraph (1). 
(5) RELATION TO STATE LAWS.—The standards established 
under this section shall supersede any State law or regulation 
(other than State licensing laws or State laws relating to plan 
solvency) with respect to qualified high risk pools which are 
established in accordance with this section. 
SEC. 1102. REINSURANCE FOR EARLY RETIREES. 
(a) ADMINISTRATION.— 
(1) IN GENERAL.—Not later than 90 days after the date 
of enactment of this Act, the Secretary shall establish a tem-
porary reinsurance program to provide reimbursement to 
participating employment-based plans for a portion of the cost 
of providing health insurance coverage to early retirees (and 
to the eligible spouses, surviving spouses, and dependents of 
such retirees) during the period beginning on the date on which 
such program is established and ending on January 1, 2014. 
(2) REFERENCE.—In this section: 
(A) HEALTH
BENEFITS.—The term ‘‘health benefits’’ 
means medical, surgical, hospital, prescription drug, and 
such other benefits as shall be determined by the Secretary,
H. R. 3590—26 
whether self-funded, or delivered through the purchase 
of insurance or otherwise. 
(B) EMPLOYMENT-BASED
PLAN.—The term ‘‘employ-
ment-based plan’’ means a group health benefits plan 
that— 
(i) is— 
(I) maintained by one or more current or 
former employers (including without limitation any 
State or local government or political subdivision 
thereof), 
employee 
organization, 
a 
voluntary 
employees’ beneficiary association, or a committee 
or board of individuals appointed to administer 
such plan; or 
(II) a multiemployer plan (as defined in section 
3(37) of the Employee Retirement Income Security 
Act of 1974); and 
(ii) provides health benefits to early retirees. 
(C) EARLY RETIREES.—The term ‘‘early retirees’’ means 
individuals who are age 55 and older but are not eligible 
for coverage under title XVIII of the Social Security Act, 
and who are not active employees of an employer 
maintaining, or currently contributing to, the employment- 
based plan or of any employer that has made substantial 
contributions to fund such plan. 
(b) PARTICIPATION.— 
(1) EMPLOYMENT-BASED PLAN ELIGIBILITY.—A participating 
employment-based plan is an employment-based plan that— 
(A) meets the requirements of paragraph (2) with 
respect to health benefits provided under the plan; and 
(B) submits to the Secretary an application for partici-
pation in the program, at such time, in such manner, 
and containing such information as the Secretary shall 
require. 
(2) EMPLOYMENT-BASED
HEALTH
BENEFITS.—An employ-
ment-based plan meets the requirements of this paragraph 
if the plan— 
(A) implements programs and procedures to generate 
cost-savings with respect to participants with chronic and 
high-cost conditions; 
(B) provides documentation of the actual cost of medical 
claims involved; and 
(C) is certified by the Secretary. 
(c) PAYMENTS.— 
(1) SUBMISSION OF CLAIMS.— 
(A) IN
GENERAL.—A participating employment-based 
plan shall submit claims for reimbursement to the Sec-
retary which shall contain documentation of the actual 
costs of the items and services for which each claim is 
being submitted. 
(B) BASIS
FOR
CLAIMS.—Claims submitted under 
subparagraph (A) shall be based on the actual amount 
expended by the participating employment-based plan 
involved within the plan year for the health benefits pro-
vided to an early retiree or the spouse, surviving spouse, 
or dependent of such retiree. In determining the amount 
of a claim for purposes of this subsection, the participating
H. R. 3590—27 
employment-based plan shall take into account any nego-
tiated price concessions (such as discounts, direct or 
indirect subsidies, rebates, and direct or indirect remunera-
tions) obtained by such plan with respect to such health 
benefit. For purposes of determining the amount of any 
such claim, the costs paid by the early retiree or the 
retiree’s spouse, surviving spouse, or dependent in the form 
of deductibles, co-payments, or co-insurance shall be 
included in the amounts paid by the participating employ-
ment-based plan. 
(2) PROGRAM PAYMENTS.—If the Secretary determines that 
a participating employment-based plan has submitted a valid 
claim under paragraph (1), the Secretary shall reimburse such 
plan for 80 percent of that portion of the costs attributable 
to such claim that exceed $15,000, subject to the limits con-
tained in paragraph (3). 
(3) LIMIT.—To be eligible for reimbursement under the 
program, a claim submitted by a participating employment- 
based plan shall not be less than $15,000 nor greater than 
$90,000. Such amounts shall be adjusted each fiscal year based 
on the percentage increase in the Medical Care Component 
of the Consumer Price Index for all urban consumers (rounded 
to the nearest multiple of $1,000) for the year involved. 
(4) USE OF PAYMENTS.—Amounts paid to a participating 
employment-based plan under this subsection shall be used 
to lower costs for the plan. Such payments may be used to 
reduce premium costs for an entity described in subsection 
(a)(2)(B)(i) or to reduce premium contributions, co-payments, 
deductibles, co-insurance, or other out-of-pocket costs for plan 
participants. Such payments shall not be used as general reve-
nues for an entity described in subsection (a)(2)(B)(i). The Sec-
retary shall develop a mechanism to monitor the appropriate 
use of such payments by such entities. 
(5) 
PAYMENTS
NOT
TREATED
AS
INCOME.—Payments 
received under this subsection shall not be included in deter-
mining the gross income of an entity described in subsection 
(a)(2)(B)(i) that is maintaining or currently contributing to a 
participating employment-based plan. 
(6) APPEALS.—The Secretary shall establish— 
(A) an appeals process to permit participating employ-
ment-based plans to appeal a determination of the Sec-
retary with respect to claims submitted under this section; 
and 
(B) procedures to protect against fraud, waste, and 
abuse under the program. 
(d) AUDITS.—The Secretary shall conduct annual audits of 
claims data submitted by participating employment-based plans 
under this section to ensure that such plans are in compliance 
with the requirements of this section. 
(e) FUNDING.—There is appropriated to the Secretary, out of 
any 
moneys 
in 
the 
Treasury 
not 
otherwise 
appropriated, 
$5,000,000,000 to carry out the program under this section. Such 
funds shall be available without fiscal year limitation. 
(f) LIMITATION.—The Secretary has the authority to stop taking 
applications for participation in the program based on the avail-
ability of funding under subsection (e).
H. R. 3590—28 
SEC. 1103. IMMEDIATE INFORMATION THAT ALLOWS CONSUMERS TO 
IDENTIFY AFFORDABLE COVERAGE OPTIONS. 
(a) INTERNET PORTAL TO AFFORDABLE COVERAGE OPTIONS.— 
(1) IMMEDIATE
ESTABLISHMENT.—Not later than July 1, 
2010, the Secretary, in consultation with the States, shall estab-
lish a mechanism, including an Internet website, through which 
a resident of any State may identify affordable health insurance 
coverage options in that State. 
(2) CONNECTING TO AFFORDABLE COVERAGE.—An Internet 
website established under paragraph (1) shall, to the extent 
practicable, provide ways for residents of any State to receive 
information on at least the following coverage options: 
(A) Health insurance coverage offered by health insur-
ance issuers, other than coverage that provides reimburse-
ment only for the treatment or mitigation of— 
(i) a single disease or condition; or 
(ii) an unreasonably limited set of diseases or 
conditions (as determined by the Secretary); 
(B) Medicaid coverage under title XIX of the Social 
Security Act. 
(C) Coverage under title XXI of the Social Security 
Act. 
(D) A State health benefits high risk pool, to the extent 
that such high risk pool is offered in such State; and 
(E) Coverage under a high risk pool under section 
1101. 
(b) ENHANCING COMPARATIVE PURCHASING OPTIONS.— 
(1) IN GENERAL.—Not later than 60 days after the date 
of enactment of this Act, the Secretary shall develop a standard-
ized format to be used for the presentation of information 
relating to the coverage options described in subsection (a)(2). 
Such format shall, at a minimum, require the inclusion of 
information on the percentage of total premium revenue 
expended on nonclinical costs (as reported under section 2718(a) 
of the Public Health Service Act), eligibility, availability, pre-
mium rates, and cost sharing with respect to such coverage 
options and be consistent with the standards adopted for the 
uniform explanation of coverage as provided for in section 2715 
of the Public Health Service Act. 
(2) USE OF FORMAT.—The Secretary shall utilize the format 
developed under paragraph (1) in compiling information con-
cerning coverage options on the Internet website established 
under subsection (a). 
(c) AUTHORITY TO CONTRACT.—The Secretary may carry out 
this section through contracts entered into with qualified entities. 
SEC. 1104. ADMINISTRATIVE SIMPLIFICATION. 
(a) PURPOSE OF ADMINISTRATIVE SIMPLIFICATION.—Section 261 
of the Health Insurance Portability and Accountability Act of 1996 
(42 U.S.C. 1320d note) is amended— 
(1) by inserting ‘‘uniform’’ before ‘‘standards’’; and 
(2) by inserting ‘‘and to reduce the clerical burden on 
patients, health care providers, and health plans’’ before the 
period at the end. 
(b) OPERATING
RULES
FOR
HEALTH
INFORMATION
TRANS-
ACTIONS.—
H. R. 3590—29 
(1) DEFINITION OF OPERATING RULES.—Section 1171 of the 
Social Security Act (42 U.S.C. 1320d) is amended by adding 
at the end the following: 
‘‘(9) OPERATING RULES.—The term ‘operating rules’ means 
the necessary business rules and guidelines for the electronic 
exchange of information that are not defined by a standard 
or its implementation specifications as adopted for purposes 
of this part.’’. 
(2) TRANSACTION
STANDARDS; 
OPERATING
RULES
AND 
COMPLIANCE.—Section 1173 of the Social Security Act (42 U.S.C. 
1320d–2) is amended— 
(A) in subsection (a)(2), by adding at the end the fol-
lowing new subparagraph: 
‘‘(J) Electronic funds transfers.’’; 
(B) in subsection (a), by adding at the end the following 
new paragraph: 
‘‘(4) REQUIREMENTS
FOR
FINANCIAL
AND
ADMINISTRATIVE 
TRANSACTIONS.— 
‘‘(A) IN GENERAL.—The standards and associated oper-
ating rules adopted by the Secretary shall— 
‘‘(i) to the extent feasible and appropriate, enable 
determination of an individual’s eligibility and finan-
cial responsibility for specific services prior to or at 
the point of care; 
‘‘(ii) be comprehensive, requiring minimal aug-
mentation by paper or other communications; 
‘‘(iii) provide for timely acknowledgment, response, 
and status reporting that supports a transparent 
claims and denial management process (including adju-
dication and appeals); and 
‘‘(iv) describe all data elements (including reason 
and remark codes) in unambiguous terms, require that 
such data elements be required or conditioned upon 
set values in other fields, and prohibit additional condi-
tions (except where necessary to implement State or 
Federal law, or to protect against fraud and abuse). 
‘‘(B) REDUCTION
OF
CLERICAL
BURDEN.—In adopting 
standards and operating rules for the transactions referred 
to under paragraph (1), the Secretary shall seek to reduce 
the number and complexity of forms (including paper and 
electronic forms) and data entry required by patients and 
providers.’’; and 
(C) by adding at the end the following new subsections: 
‘‘(g) OPERATING RULES.— 
‘‘(1) IN GENERAL.—The Secretary shall adopt a single set 
of operating rules for each transaction referred to under sub-
section (a)(1) with the goal of creating as much uniformity 
in the implementation of the electronic standards as possible. 
Such operating rules shall be consensus-based and reflect the 
necessary business rules affecting health plans and health care 
providers and the manner in which they operate pursuant 
to standards issued under Health Insurance Portability and 
Accountability Act of 1996. 
‘‘(2) OPERATING RULES DEVELOPMENT.—In adopting oper-
ating rules under this subsection, the Secretary shall consider 
recommendations for operating rules developed by a qualified 
nonprofit entity that meets the following requirements:
H. R. 3590—30 
‘‘(A) The entity focuses its mission on administrative 
simplification. 
‘‘(B) The entity demonstrates a multi-stakeholder and 
consensus-based process for development of operating rules, 
including representation by or participation from health 
plans, health care providers, vendors, relevant Federal 
agencies, and other standard development organizations. 
‘‘(C) The entity has a public set of guiding principles 
that ensure the operating rules and process are open and 
transparent, and supports nondiscrimination and conflict 
of interest policies that demonstrate a commitment to open, 
fair, and nondiscriminatory practices. 
‘‘(D) The entity builds on the transaction standards 
issued under Health Insurance Portability and Account-
ability Act of 1996. 
‘‘(E) The entity allows for public review and updates 
of the operating rules. 
‘‘(3) REVIEW AND RECOMMENDATIONS.—The National Com-
mittee on Vital and Health Statistics shall— 
‘‘(A) advise the Secretary as to whether a nonprofit 
entity meets the requirements under paragraph (2); 
‘‘(B) review the operating rules developed and rec-
ommended by such nonprofit entity; 
‘‘(C) determine whether such operating rules represent 
a consensus view of the health care stakeholders and are 
consistent with and do not conflict with other existing 
standards; 
‘‘(D) evaluate whether such operating rules are con-
sistent with electronic standards adopted for health 
information technology; and 
‘‘(E) submit to the Secretary a recommendation as to 
whether the Secretary should adopt such operating rules. 
‘‘(4) IMPLEMENTATION.— 
‘‘(A) IN GENERAL.—The Secretary shall adopt operating 
rules under this subsection, by regulation in accordance 
with subparagraph (C), following consideration of the oper-
ating rules developed by the non-profit entity described 
in paragraph (2) and the recommendation submitted by 
the National Committee on Vital and Health Statistics 
under paragraph (3)(E) and having ensured consultation 
with providers. 
‘‘(B) ADOPTION REQUIREMENTS; EFFECTIVE DATES.— 
‘‘(i) ELIGIBILITY FOR A HEALTH PLAN AND HEALTH 
CLAIM STATUS.—The set of operating rules for eligibility 
for a health plan and health claim status transactions 
shall be adopted not later than July 1, 2011, in a 
manner ensuring that such operating rules are effective 
not later than January 1, 2013, and may allow for 
the use of a machine readable identification card. 
‘‘(ii) ELECTRONIC FUNDS TRANSFERS AND HEALTH 
CARE PAYMENT AND REMITTANCE ADVICE.—The set of 
operating rules for electronic funds transfers and 
health care payment and remittance advice trans-
actions shall— 
‘‘(I) allow for automated reconciliation of the 
electronic payment with the remittance advice; and
H. R. 3590—31 
‘‘(II) be adopted not later than July 1, 2012, 
in a manner ensuring that such operating rules 
are effective not later than January 1, 2014. 
‘‘(iii) HEALTH CLAIMS OR EQUIVALENT ENCOUNTER 
INFORMATION, ENROLLMENT AND DISENROLLMENT IN A 
HEALTH
PLAN, 
HEALTH
PLAN
PREMIUM
PAYMENTS, 
REFERRAL CERTIFICATION AND AUTHORIZATION.—The set 
of operating rules for health claims or equivalent 
encounter information, enrollment and disenrollment 
in a health plan, health plan premium payments, and 
referral certification and authorization transactions 
shall be adopted not later than July 1, 2014, in a 
manner ensuring that such operating rules are effective 
not later than January 1, 2016. 
‘‘(C) EXPEDITED
RULEMAKING.—The Secretary shall 
promulgate an interim final rule applying any standard 
or operating rule recommended by the National Committee 
on Vital and Health Statistics pursuant to paragraph (3). 
The Secretary shall accept and consider public comments 
on any interim final rule published under this subpara-
graph for 60 days after the date of such publication. 
‘‘(h) COMPLIANCE.— 
‘‘(1) HEALTH PLAN CERTIFICATION.— 
‘‘(A) ELIGIBILITY FOR A HEALTH PLAN, HEALTH CLAIM 
STATUS, ELECTRONIC FUNDS TRANSFERS, HEALTH CARE PAY-
MENT AND REMITTANCE ADVICE.—Not later than December 
31, 2013, a health plan shall file a statement with the 
Secretary, in such form as the Secretary may require, 
certifying that the data and information systems for such 
plan are in compliance with any applicable standards (as 
described under paragraph (7) of section 1171) and associ-
ated operating rules (as described under paragraph (9) 
of such section) for electronic funds transfers, eligibility 
for a health plan, health claim status, and health care 
payment and remittance advice, respectively. 
‘‘(B) HEALTH
CLAIMS
OR
EQUIVALENT
ENCOUNTER 
INFORMATION, ENROLLMENT
AND
DISENROLLMENT
IN
A 
HEALTH PLAN, HEALTH PLAN PREMIUM PAYMENTS, HEALTH 
CLAIMS
ATTACHMENTS, 
REFERRAL
CERTIFICATION
AND 
AUTHORIZATION.—Not later than December 31, 2015, a 
health plan shall file a statement with the Secretary, in 
such form as the Secretary may require, certifying that 
the data and information systems for such plan are in 
compliance with any applicable standards and associated 
operating rules for health claims or equivalent encounter 
information, enrollment and disenrollment in a health plan, 
health plan premium payments, health claims attachments, 
and referral certification and authorization, respectively. 
A health plan shall provide the same level of documentation 
to certify compliance with such transactions as is required 
to certify compliance with the transactions specified in 
subparagraph (A). 
‘‘(2) DOCUMENTATION OF COMPLIANCE.—A health plan shall 
provide the Secretary, in such form as the Secretary may 
require, with adequate documentation of compliance with the 
standards and operating rules described under paragraph (1). 
A health plan shall not be considered to have provided adequate
H. R. 3590—32 
documentation and shall not be certified as being in compliance 
with such standards, unless the health plan— 
‘‘(A) demonstrates to the Secretary that the plan con-
ducts the electronic transactions specified in paragraph 
(1) in a manner that fully complies with the regulations 
of the Secretary; and 
‘‘(B) provides documentation showing that the plan 
has completed end-to-end testing for such transactions with 
their partners, such as hospitals and physicians. 
‘‘(3) SERVICE CONTRACTS.—A health plan shall be required 
to ensure that any entities that provide services pursuant to 
a contract with such health plan shall comply with any 
applicable certification and compliance requirements (and pro-
vide the Secretary with adequate documentation of such compli-
ance) under this subsection. 
‘‘(4) CERTIFICATION
BY
OUTSIDE
ENTITY.—The Secretary 
may designate independent, outside entities to certify that a 
health plan has complied with the requirements under this 
subsection, provided that the certification standards employed 
by such entities are in accordance with any standards or oper-
ating rules issued by the Secretary. 
‘‘(5) COMPLIANCE WITH REVISED STANDARDS AND OPERATING 
RULES.— 
‘‘(A) IN GENERAL.—A health plan (including entities 
described under paragraph (3)) shall file a statement with 
the Secretary, in such form as the Secretary may require, 
certifying that the data and information systems for such 
plan are in compliance with any applicable revised stand-
ards and associated operating rules under this subsection 
for any interim final rule promulgated by the Secretary 
under subsection (i) that— 
‘‘(i) amends any standard or operating rule 
described under paragraph (1) of this subsection; or 
‘‘(ii) establishes a standard (as described under 
subsection (a)(1)(B)) or associated operating rules (as 
described under subsection (i)(5)) for any other finan-
cial and administrative transactions. 
‘‘(B) DATE OF COMPLIANCE.—A health plan shall comply 
with such requirements not later than the effective date 
of the applicable standard or operating rule. 
‘‘(6) AUDITS OF HEALTH PLANS.—The Secretary shall conduct 
periodic audits to ensure that health plans (including entities 
described under paragraph (3)) are in compliance with any 
standards and operating rules that are described under para-
graph (1) or subsection (i)(5). 
‘‘(i) REVIEW AND AMENDMENT OF STANDARDS AND OPERATING 
RULES.— 
‘‘(1) ESTABLISHMENT.—Not later than January 1, 2014, the 
Secretary shall establish a review committee (as described 
under paragraph (4)). 
‘‘(2) EVALUATIONS AND REPORTS.— 
‘‘(A) HEARINGS.—Not later than April 1, 2014, and 
not less than biennially thereafter, the Secretary, acting 
through the review committee, shall conduct hearings to 
evaluate and review the adopted standards and operating 
rules established under this section.
H. R. 3590—33 
‘‘(B) REPORT.—Not later than July 1, 2014, and not 
less than biennially thereafter, the review committee shall 
provide recommendations for updating and improving such 
standards and operating rules. The review committee shall 
recommend a single set of operating rules per transaction 
standard and maintain the goal of creating as much uni-
formity as possible in the implementation of the electronic 
standards. 
‘‘(3) INTERIM FINAL RULEMAKING.— 
‘‘(A) IN
GENERAL.—Any recommendations to amend 
adopted standards and operating rules that have been 
approved by the review committee and reported to the 
Secretary under paragraph (2)(B) shall be adopted by the 
Secretary through promulgation of an interim final rule 
not later than 90 days after receipt of the committee’s 
report. 
‘‘(B) PUBLIC COMMENT.— 
‘‘(i) PUBLIC COMMENT PERIOD.—The Secretary shall 
accept and consider public comments on any interim 
final rule published under this paragraph for 60 days 
after the date of such publication. 
‘‘(ii) EFFECTIVE DATE.—The effective date of any 
amendment to existing standards or operating rules 
that is adopted through an interim final rule published 
under this paragraph shall be 25 months following 
the close of such public comment period. 
‘‘(4) REVIEW COMMITTEE.— 
‘‘(A) DEFINITION.—For the purposes of this subsection, 
the term ‘review committee’ means a committee chartered 
by or within the Department of Health and Human services 
that has been designated by the Secretary to carry out 
this subsection, including— 
‘‘(i) the National Committee on Vital and Health 
Statistics; or 
‘‘(ii) any appropriate committee as determined by 
the Secretary. 
‘‘(B) COORDINATION OF HIT STANDARDS.—In developing 
recommendations under this subsection, the review com-
mittee shall ensure coordination, as appropriate, with the 
standards that support the certified electronic health record 
technology approved by the Office of the National Coordi-
nator for Health Information Technology. 
‘‘(5) OPERATING RULES FOR OTHER STANDARDS ADOPTED BY 
THE
SECRETARY.—The Secretary shall adopt a single set of 
operating rules (pursuant to the process described under sub-
section (g)) for any transaction for which a standard had been 
adopted pursuant to subsection (a)(1)(B). 
‘‘(j) PENALTIES.— 
‘‘(1) PENALTY FEE.— 
‘‘(A) IN GENERAL.—Not later than April 1, 2014, and 
annually thereafter, the Secretary shall assess a penalty 
fee (as determined under subparagraph (B)) against a 
health plan that has failed to meet the requirements under 
subsection (h) with respect to certification and documenta-
tion of compliance with— 
‘‘(i) the standards and associated operating rules 
described under paragraph (1) of such subsection; and
H. R. 3590—34 
‘‘(ii) a standard (as described under subsection 
(a)(1)(B)) and associated operating rules (as described 
under subsection (i)(5)) for any other financial and 
administrative transactions. 
‘‘(B) FEE AMOUNT.—Subject to subparagraphs (C), (D), 
and (E), the Secretary shall assess a penalty fee against 
a health plan in the amount of $1 per covered life until 
certification is complete. The penalty shall be assessed 
per person covered by the plan for which its data systems 
for major medical policies are not in compliance and shall 
be imposed against the health plan for each day that the 
plan is not in compliance with the requirements under 
subsection (h). 
‘‘(C) ADDITIONAL PENALTY FOR MISREPRESENTATION.— 
A health plan that knowingly provides inaccurate or incom-
plete information in a statement of certification or docu-
mentation of compliance under subsection (h) shall be sub-
ject to a penalty fee that is double the amount that would 
otherwise be imposed under this subsection. 
‘‘(D) ANNUAL FEE INCREASE.—The amount of the pen-
alty fee imposed under this subsection shall be increased 
on an annual basis by the annual percentage increase 
in total national health care expenditures, as determined 
by the Secretary. 
‘‘(E) PENALTY LIMIT.—A penalty fee assessed against 
a health plan under this subsection shall not exceed, on 
an annual basis— 
‘‘(i) an amount equal to $20 per covered life under 
such plan; or 
‘‘(ii) an amount equal to $40 per covered life under 
the plan if such plan has knowingly provided inac-
curate or incomplete information (as described under 
subparagraph (C)). 
‘‘(F) DETERMINATION
OF
COVERED
INDIVIDUALS.—The 
Secretary shall determine the number of covered lives 
under a health plan based upon the most recent statements 
and filings that have been submitted by such plan to the 
Securities and Exchange Commission. 
‘‘(2) NOTICE AND DISPUTE PROCEDURE.—The Secretary shall 
establish a procedure for assessment of penalty fees under 
this subsection that provides a health plan with reasonable 
notice and a dispute resolution procedure prior to provision 
of a notice of assessment by the Secretary of the Treasury 
(as described under paragraph (4)(B)). 
‘‘(3) PENALTY FEE REPORT.—Not later than May 1, 2014, 
and annually thereafter, the Secretary shall provide the Sec-
retary of the Treasury with a report identifying those health 
plans that have been assessed a penalty fee under this sub-
section. 
‘‘(4) COLLECTION OF PENALTY FEE.— 
‘‘(A) IN
GENERAL.—The Secretary of the Treasury, 
acting through the Financial Management Service, shall 
administer the collection of penalty fees from health plans 
that have been identified by the Secretary in the penalty 
fee report provided under paragraph (3). 
‘‘(B) NOTICE.—Not later than August 1, 2014, and 
annually thereafter, the Secretary of the Treasury shall
H. R. 3590—35 
provide notice to each health plan that has been assessed 
a penalty fee by the Secretary under this subsection. Such 
notice shall include the amount of the penalty fee assessed 
by the Secretary and the due date for payment of such 
fee to the Secretary of the Treasury (as described in 
subparagraph (C)). 
‘‘(C) PAYMENT DUE DATE.—Payment by a health plan 
for a penalty fee assessed under this subsection shall be 
made to the Secretary of the Treasury not later than 
November 1, 2014, and annually thereafter. 
‘‘(D) UNPAID PENALTY FEES.—Any amount of a penalty 
fee assessed against a health plan under this subsection 
for which payment has not been made by the due date 
provided under subparagraph (C) shall be— 
‘‘(i) increased by the interest accrued on such 
amount, as determined pursuant to the underpayment 
rate established under section 6621 of the Internal 
Revenue Code of 1986; and 
‘‘(ii) treated as a past-due, legally enforceable debt 
owed to a Federal agency for purposes of section 
6402(d) of the Internal Revenue Code of 1986. 
‘‘(E) ADMINISTRATIVE FEES.—Any fee charged or allo-
cated for collection activities conducted by the Financial 
Management Service will be passed on to a health plan 
on a pro-rata basis and added to any penalty fee collected 
from the plan.’’. 
(c) PROMULGATION OF RULES.— 
(1) UNIQUE HEALTH PLAN IDENTIFIER.—The Secretary shall 
promulgate a final rule to establish a unique health plan identi-
fier (as described in section 1173(b) of the Social Security 
Act (42 U.S.C. 1320d–2(b))) based on the input of the National 
Committee on Vital and Health Statistics. The Secretary may 
do so on an interim final basis and such rule shall be effective 
not later than October 1, 2012. 
(2) ELECTRONIC
FUNDS
TRANSFER.—The Secretary shall 
promulgate a final rule to establish a standard for electronic 
funds transfers (as described in section 1173(a)(2)(J) of the 
Social Security Act, as added by subsection (b)(2)(A)). The Sec-
retary may do so on an interim final basis and shall adopt 
such standard not later than January 1, 2012, in a manner 
ensuring that such standard is effective not later than January 
1, 2014. 
(3) HEALTH
CLAIMS
ATTACHMENTS.—The Secretary shall 
promulgate a final rule to establish a transaction standard 
and a single set of associated operating rules for health claims 
attachments (as described in section 1173(a)(2)(B) of the Social 
Security Act (42 U.S.C. 1320d–2(a)(2)(B))) that is consistent 
with the X12 Version 5010 transaction standards. The Secretary 
may do so on an interim final basis and shall adopt a trans-
action standard and a single set of associated operating rules 
not later than January 1, 2014, in a manner ensuring that 
such standard is effective not later than January 1, 2016. 
(d) EXPANSION OF ELECTRONIC TRANSACTIONS IN MEDICARE.— 
Section 1862(a) of the Social Security Act (42 U.S.C. 1395y(a)) 
is amended— 
(1) in paragraph (23), by striking the ‘‘or’’ at the end;
H. R. 3590—36 
(2) in paragraph (24), by striking the period and inserting 
‘‘; or’’; and 
(3) by inserting after paragraph (24) the following new 
paragraph: 
‘‘(25) not later than January 1, 2014, for which the payment 
is other than by electronic funds transfer (EFT) or an electronic 
remittance in a form as specified in ASC X12 835 Health 
Care Payment and Remittance Advice or subsequent standard.’’. 
SEC. 1105. EFFECTIVE DATE. 
This subtitle shall take effect on the date of enactment of 
this Act. 
Subtitle C—Quality Health Insurance 
Coverage for All Americans 
PART I—HEALTH INSURANCE MARKET 
REFORMS 
SEC. 1201. AMENDMENT TO THE PUBLIC HEALTH SERVICE ACT. 
Part A of title XXVII of the Public Health Service Act (42 
U.S.C. 300gg et seq.), as amended by section 1001, is further 
amended— 
(1) by striking the heading for subpart 1 and inserting 
the following: 
‘‘Subpart I—General Reform’’; 
(2)(A) in section 2701 (42 U.S.C. 300gg), by striking the 
section heading and subsection (a) and inserting the following: 
‘‘SEC. 2704. PROHIBITION OF PREEXISTING CONDITION EXCLUSIONS 
OR OTHER DISCRIMINATION BASED ON HEALTH STATUS. 
‘‘(a) IN GENERAL.—A group health plan and a health insurance 
issuer offering group or individual health insurance coverage may 
not impose any preexisting condition exclusion with respect to such 
plan or coverage.’’; and 
(B) by transferring such section (as amended by subpara-
graph (A)) so as to appear after the section 2703 added by 
paragraph (4); 
(3)(A) in section 2702 (42 U.S.C. 300gg–1)— 
(i) by striking the section heading and all that follows 
through subsection (a); 
(ii) in subsection (b)— 
(I) by striking ‘‘health insurance issuer offering 
health insurance coverage in connection with a group 
health plan’’ each place that such appears and inserting 
‘‘health insurance issuer offering group or individual 
health insurance coverage’’; and 
(II) in paragraph (2)(A)— 
(aa) 
by 
inserting 
‘‘or 
individual’’ 
after 
‘‘employer’’; and 
(bb) by inserting ‘‘or individual health cov-
erage, as the case may be’’ before the semicolon; 
and 
(iii) in subsection (e)—
H. R. 3590—37 
(I) by striking ‘‘(a)(1)(F)’’ and inserting ‘‘(a)(6)’’; 
(II) by striking ‘‘2701’’ and inserting ‘‘2704’’; and 
(III) by striking ‘‘2721(a)’’ and inserting ‘‘2735(a)’’; 
and 
(B) by transferring such section (as amended by 
subparagraph (A)) to appear after section 2705(a) as added 
by paragraph (4); and 
(4) by inserting after the subpart heading (as added by 
paragraph (1)) the following: 
‘‘SEC. 2701. FAIR HEALTH INSURANCE PREMIUMS. 
‘‘(a) PROHIBITING DISCRIMINATORY PREMIUM RATES.— 
‘‘(1) IN
GENERAL.—With respect to the premium rate 
charged by a health insurance issuer for health insurance cov-
erage offered in the individual or small group market— 
‘‘(A) such rate shall vary with respect to the particular 
plan or coverage involved only by— 
‘‘(i) whether such plan or coverage covers an indi-
vidual or family; 
‘‘(ii) rating area, as established in accordance with 
paragraph (2); 
‘‘(iii) age, except that such rate shall not vary 
by more than 3 to 1 for adults (consistent with section 
2707(c)); and 
‘‘(iv) tobacco use, except that such rate shall not 
vary by more than 1.5 to 1; and 
‘‘(B) such rate shall not vary with respect to the par-
ticular plan or coverage involved by any other factor not 
described in subparagraph (A). 
‘‘(2) RATING AREA.— 
‘‘(A) IN GENERAL.—Each State shall establish 1 or more 
rating areas within that State for purposes of applying 
the requirements of this title. 
‘‘(B) SECRETARIAL REVIEW.—The Secretary shall review 
the rating areas established by each State under subpara-
graph (A) to ensure the adequacy of such areas for purposes 
of carrying out the requirements of this title. If the Sec-
retary determines a State’s rating areas are not adequate, 
or that a State does not establish such areas, the Secretary 
may establish rating areas for that State. 
‘‘(3) PERMISSIBLE AGE BANDS.—The Secretary, in consulta-
tion with the National Association of Insurance Commissioners, 
shall define the permissible age bands for rating purposes 
under paragraph (1)(A)(iii). 
‘‘(4) APPLICATION OF VARIATIONS BASED ON AGE OR TOBACCO 
USE.—With respect to family coverage under a group health 
plan or health insurance coverage, the rating variations per-
mitted under clauses (iii) and (iv) of paragraph (1)(A) shall 
be applied based on the portion of the premium that is attrib-
utable to each family member covered under the plan or cov-
erage. 
‘‘(5) SPECIAL RULE FOR LARGE GROUP MARKET.—If a State 
permits health insurance issuers that offer coverage in the 
large group market in the State to offer such coverage through 
the State Exchange (as provided for under section 1312(f)(2)(B)
H. R. 3590—38 
of the Patient Protection and Affordable Care Act), the provi-
sions of this subsection shall apply to all coverage offered 
in such market in the State. 
‘‘SEC. 2702. GUARANTEED AVAILABILITY OF COVERAGE. 
‘‘(a) GUARANTEED ISSUANCE OF COVERAGE IN THE INDIVIDUAL 
AND GROUP MARKET.—Subject to subsections (b) through (e), each 
health insurance issuer that offers health insurance coverage in 
the individual or group market in a State must accept every 
employer and individual in the State that applies for such coverage. 
‘‘(b) ENROLLMENT.— 
‘‘(1) RESTRICTION.—A health insurance issuer described in 
subsection (a) may restrict enrollment in coverage described 
in such subsection to open or special enrollment periods. 
‘‘(2) ESTABLISHMENT.—A health insurance issuer described 
in subsection (a) shall, in accordance with the regulations 
promulgated under paragraph (3), establish special enrollment 
periods for qualifying events (under section 603 of the Employee 
Retirement Income Security Act of 1974). 
‘‘(3) REGULATIONS.—The Secretary shall promulgate regula-
tions with respect to enrollment periods under paragraphs (1) 
and (2). 
‘‘SEC. 2703. GUARANTEED RENEWABILITY OF COVERAGE. 
‘‘(a) IN GENERAL.—Except as provided in this section, if a health 
insurance issuer offers health insurance coverage in the individual 
or group market, the issuer must renew or continue in force such 
coverage at the option of the plan sponsor or the individual, as 
applicable. 
‘‘SEC. 2705. PROHIBITING DISCRIMINATION AGAINST INDIVIDUAL 
PARTICIPANTS AND BENEFICIARIES BASED ON HEALTH 
STATUS. 
‘‘(a) IN GENERAL.—A group health plan and a health insurance 
issuer offering group or individual health insurance coverage may 
not establish rules for eligibility (including continued eligibility) 
of any individual to enroll under the terms of the plan or coverage 
based on any of the following health status-related factors in rela-
tion to the individual or a dependent of the individual: 
‘‘(1) Health status. 
‘‘(2) Medical condition (including both physical and mental 
illnesses). 
‘‘(3) Claims experience. 
‘‘(4) Receipt of health care. 
‘‘(5) Medical history. 
‘‘(6) Genetic information. 
‘‘(7) Evidence of insurability (including conditions arising 
out of acts of domestic violence). 
‘‘(8) Disability. 
‘‘(9) Any other health status-related factor determined 
appropriate by the Secretary. 
‘‘(j) PROGRAMS OF HEALTH PROMOTION OR DISEASE PREVEN-
TION.— 
‘‘(1) GENERAL PROVISIONS.— 
‘‘(A) GENERAL
RULE.—For purposes of subsection 
(b)(2)(B), a program of health promotion or disease preven-
tion (referred to in this subsection as a ‘wellness program’) 
shall be a program offered by an employer that is designed
H. R. 3590—39 
to promote health or prevent disease that meets the 
applicable requirements of this subsection. 
‘‘(B) NO
CONDITIONS
BASED
ON
HEALTH
STATUS 
FACTOR.—If none of the conditions for obtaining a premium 
discount or rebate or other reward for participation in 
a wellness program is based on an individual satisfying 
a standard that is related to a health status factor, such 
wellness program shall not violate this section if participa-
tion in the program is made available to all similarly 
situated individuals and the requirements of paragraph 
(2) are complied with. 
‘‘(C) CONDITIONS BASED ON HEALTH STATUS FACTOR.— 
If any of the conditions for obtaining a premium discount 
or rebate or other reward for participation in a wellness 
program is based on an individual satisfying a standard 
that is related to a health status factor, such wellness 
program shall not violate this section if the requirements 
of paragraph (3) are complied with. 
‘‘(2) WELLNESS
PROGRAMS
NOT
SUBJECT
TO
REQUIRE-
MENTS.—If none of the conditions for obtaining a premium 
discount or rebate or other reward under a wellness program 
as described in paragraph (1)(B) are based on an individual 
satisfying a standard that is related to a health status factor 
(or if such a wellness program does not provide such a reward), 
the wellness program shall not violate this section if participa-
tion in the program is made available to all similarly situated 
individuals. The following programs shall not have to comply 
with the requirements of paragraph (3) if participation in the 
program is made available to all similarly situated individuals: 
‘‘(A) A program that reimburses all or part of the 
cost for memberships in a fitness center. 
‘‘(B) A diagnostic testing program that provides a 
reward for participation and does not base any part of 
the reward on outcomes. 
‘‘(C) A program that encourages preventive care related 
to a health condition through the waiver of the copayment 
or deductible requirement under group health plan for 
the costs of certain items or services related to a health 
condition (such as prenatal care or well-baby visits). 
‘‘(D) A program that reimburses individuals for the 
costs of smoking cessation programs without regard to 
whether the individual quits smoking. 
‘‘(E) A program that provides a reward to individuals 
for attending a periodic health education seminar. 
‘‘(3) WELLNESS
PROGRAMS
SUBJECT
TO
REQUIREMENTS.— 
If any of the conditions for obtaining a premium discount, 
rebate, or reward under a wellness program as described in 
paragraph (1)(C) is based on an individual satisfying a standard 
that is related to a health status factor, the wellness program 
shall not violate this section if the following requirements are 
complied with: 
‘‘(A) The reward for the wellness program, together 
with the reward for other wellness programs with respect 
to the plan that requires satisfaction of a standard related 
to a health status factor, shall not exceed 30 percent of 
the cost of employee-only coverage under the plan. If, in
H. R. 3590—40 
addition to employees or individuals, any class of depend-
ents (such as spouses or spouses and dependent children) 
may participate fully in the wellness program, such reward 
shall not exceed 30 percent of the cost of the coverage 
in which an employee or individual and any dependents 
are enrolled. For purposes of this paragraph, the cost of 
coverage shall be determined based on the total amount 
of employer and employee contributions for the benefit 
package under which the employee is (or the employee 
and any dependents are) receiving coverage. A reward may 
be in the form of a discount or rebate of a premium or 
contribution, a waiver of all or part of a cost-sharing mecha-
nism (such as deductibles, copayments, or coinsurance), 
the absence of a surcharge, or the value of a benefit that 
would otherwise not be provided under the plan. The Secre-
taries of Labor, Health and Human Services, and the 
Treasury may increase the reward available under this 
subparagraph to up to 50 percent of the cost of coverage 
if the Secretaries determine that such an increase is appro-
priate. 
‘‘(B) The wellness program shall be reasonably 
designed to promote health or prevent disease. A program 
complies with the preceding sentence if the program has 
a reasonable chance of improving the health of, or pre-
venting disease in, participating individuals and it is not 
overly burdensome, is not a subterfuge for discriminating 
based on a health status factor, and is not highly suspect 
in the method chosen to promote health or prevent disease. 
‘‘(C) The plan shall give individuals eligible for the 
program the opportunity to qualify for the reward under 
the program at least once each year. 
‘‘(D) The full reward under the wellness program shall 
be made available to all similarly situated individuals. 
For such purpose, among other things: 
‘‘(i) The reward is not available to all similarly 
situated individuals for a period unless the wellness 
program allows— 
‘‘(I) for a reasonable alternative standard (or 
waiver of the otherwise applicable standard) for 
obtaining the reward for any individual for whom, 
for that period, it is unreasonably difficult due 
to a medical condition to satisfy the otherwise 
applicable standard; and 
‘‘(II) for a reasonable alternative standard (or 
waiver of the otherwise applicable standard) for 
obtaining the reward for any individual for whom, 
for that period, it is medically inadvisable to 
attempt 
to 
satisfy 
the 
otherwise 
applicable 
standard. 
‘‘(ii) If reasonable under the circumstances, the 
plan or issuer may seek verification, such as a state-
ment from an individual’s physician, that a health 
status factor makes it unreasonably difficult or medi-
cally inadvisable for the individual to satisfy or attempt 
to satisfy the otherwise applicable standard.
H. R. 3590—41 
‘‘(E) The plan or issuer involved shall disclose in all 
plan materials describing the terms of the wellness pro-
gram the availability of a reasonable alternative standard 
(or the possibility of waiver of the otherwise applicable 
standard) required under subparagraph (D). If plan mate-
rials disclose that such a program is available, without 
describing its terms, the disclosure under this subpara-
graph shall not be required. 
‘‘(k) EXISTING PROGRAMS.—Nothing in this section shall prohibit 
a program of health promotion or disease prevention that was 
established prior to the date of enactment of this section and 
applied with all applicable regulations, and that is operating on 
such date, from continuing to be carried out for as long as such 
regulations remain in effect. 
‘‘(l) WELLNESS PROGRAM DEMONSTRATION PROJECT.— 
‘‘(1) IN GENERAL.—Not later than July 1, 2014, the Sec-
retary, in consultation with the Secretary of the Treasury and 
the Secretary of Labor, shall establish a 10-State demonstration 
project under which participating States shall apply the provi-
sions of subsection (j) to programs of health promotion offered 
by a health insurance issuer that offers health insurance cov-
erage in the individual market in such State. 
‘‘(2) EXPANSION OF DEMONSTRATION PROJECT.—If the Sec-
retary, in consultation with the Secretary of the Treasury and 
the Secretary of Labor, determines that the demonstration 
project described in paragraph (1) is effective, such Secretaries 
may, beginning on July 1, 2017 expand such demonstration 
project to include additional participating States. 
‘‘(3) REQUIREMENTS.— 
‘‘(A) MAINTENANCE OF COVERAGE.—The Secretary, in 
consultation with the Secretary of the Treasury and the 
Secretary of Labor, shall not approve the participation 
of a State in the demonstration project under this section 
unless the Secretaries determine that the State’s project 
is designed in a manner that— 
‘‘(i) will not result in any decrease in coverage; 
and 
‘‘(ii) will not increase the cost to the Federal 
Government in providing credits under section 36B 
of the Internal Revenue Code of 1986 or cost-sharing 
assistance under section 1402 of the Patient Protection 
and Affordable Care Act. 
‘‘(B) OTHER REQUIREMENTS.—States that participate in 
the demonstration project under this subsection— 
‘‘(i) may permit premium discounts or rebates or 
the modification of otherwise applicable copayments 
or deductibles for adherence to, or participation in, 
a reasonably designed program of health promotion 
and disease prevention; 
‘‘(ii) shall ensure that requirements of consumer 
protection are met in programs of health promotion 
in the individual market; 
‘‘(iii) shall require verification from health insur-
ance issuers that offer health insurance coverage in 
the individual market of such State that premium 
discounts—
H. R. 3590—42 
‘‘(I) do not create undue burdens for individ-
uals insured in the individual market; 
‘‘(II) do not lead to cost shifting; and 
‘‘(III) are not a subterfuge for discrimination; 
‘‘(iv) shall ensure that consumer data is protected 
in accordance with the requirements of section 264(c) 
of the Health Insurance Portability and Accountability 
Act of 1996 (42 U.S.C. 1320d–2 note); and 
‘‘(v) shall ensure and demonstrate to the satisfac-
tion of the Secretary that the discounts or other 
rewards provided under the project reflect the expected 
level of participation in the wellness program involved 
and the anticipated effect the program will have on 
utilization or medical claim costs. 
‘‘(m) REPORT.— 
‘‘(1) IN GENERAL.—Not later than 3 years after the date 
of enactment of the Patient Protection and Affordable Care 
Act, the Secretary, in consultation with the Secretary of the 
Treasury and the Secretary of Labor, shall submit a report 
to the appropriate committees of Congress concerning— 
‘‘(A) the effectiveness of wellness programs (as defined 
in subsection (j)) in promoting health and preventing dis-
ease; 
‘‘(B) the impact of such wellness programs on the access 
to care and affordability of coverage for participants and 
non-participants of such programs; 
‘‘(C) the impact of premium-based and cost-sharing 
incentives on participant behavior and the role of such 
programs in changing behavior; and 
‘‘(D) the effectiveness of different types of rewards. 
‘‘(2) DATA COLLECTION.—In preparing the report described 
in paragraph (1), the Secretaries shall gather relevant informa-
tion from employers who provide employees with access to 
wellness programs, including State and Federal agencies. 
‘‘(n) REGULATIONS.—Nothing in this section shall be construed 
as prohibiting the Secretaries of Labor, Health and Human Services, 
or the Treasury from promulgating regulations in connection with 
this section. 
‘‘SEC. 2706. NON-DISCRIMINATION IN HEALTH CARE. 
‘‘(a) PROVIDERS.—A group health plan and a health insurance 
issuer offering group or individual health insurance coverage shall 
not discriminate with respect to participation under the plan or 
coverage against any health care provider who is acting within 
the scope of that provider’s license or certification under applicable 
State law. This section shall not require that a group health plan 
or health insurance issuer contract with any health care provider 
willing to abide by the terms and conditions for participation estab-
lished by the plan or issuer. Nothing in this section shall be con-
strued as preventing a group health plan, a health insurance issuer, 
or the Secretary from establishing varying reimbursement rates 
based on quality or performance measures. 
‘‘(b) INDIVIDUALS.—The provisions of section 1558 of the Patient 
Protection and Affordable Care Act (relating to non-discrimination) 
shall apply with respect to a group health plan or health insurance 
issuer offering group or individual health insurance coverage.
H. R. 3590—43 
‘‘SEC. 2707. COMPREHENSIVE HEALTH INSURANCE COVERAGE. 
‘‘(a) COVERAGE FOR ESSENTIAL HEALTH BENEFITS PACKAGE.— 
A health insurance issuer that offers health insurance coverage 
in the individual or small group market shall ensure that such 
coverage includes the essential health benefits package required 
under section 1302(a) of the Patient Protection and Affordable Care 
Act. 
‘‘(b) COST-SHARING UNDER GROUP HEALTH PLANS.—A group 
health plan shall ensure that any annual cost-sharing imposed 
under the plan does not exceed the limitations provided for under 
paragraphs (1) and (2) of section 1302(c). 
‘‘(c) CHILD-ONLY PLANS.—If a health insurance issuer offers 
health insurance coverage in any level of coverage specified under 
section 1302(d) of the Patient Protection and Affordable Care Act, 
the issuer shall also offer such coverage in that level as a plan 
in which the only enrollees are individuals who, as of the beginning 
of a plan year, have not attained the age of 21. 
‘‘(d) DENTAL ONLY.—This section shall not apply to a plan 
described in section 1302(d)(2)(B)(ii)(I). 
‘‘SEC. 2708. PROHIBITION ON EXCESSIVE WAITING PERIODS. 
‘‘A group health plan and a health insurance issuer offering 
group or individual health insurance coverage shall not apply any 
waiting period (as defined in section 2704(b)(4)) that exceeds 90 
days.’’. 
PART II—OTHER PROVISIONS 
SEC. 1251. PRESERVATION OF RIGHT TO MAINTAIN EXISTING COV-
ERAGE. 
(a) NO CHANGES TO EXISTING COVERAGE.— 
(1) IN GENERAL.—Nothing in this Act (or an amendment 
made by this Act) shall be construed to require that an indi-
vidual terminate coverage under a group health plan or health 
insurance coverage in which such individual was enrolled on 
the date of enactment of this Act. 
(2) CONTINUATION OF COVERAGE.—With respect to a group 
health plan or health insurance coverage in which an individual 
was enrolled on the date of enactment of this Act, this subtitle 
and subtitle A (and the amendments made by such subtitles) 
shall not apply to such plan or coverage, regardless of whether 
the individual renews such coverage after such date of enact-
ment. 
(b) ALLOWANCE FOR FAMILY MEMBERS TO JOIN CURRENT COV-
ERAGE.—With respect to a group health plan or health insurance 
coverage in which an individual was enrolled on the date of enact-
ment of this Act and which is renewed after such date, family 
members of such individual shall be permitted to enroll in such 
plan or coverage if such enrollment is permitted under the terms 
of the plan in effect as of such date of enactment. 
(c) ALLOWANCE FOR NEW EMPLOYEES TO JOIN CURRENT PLAN.— 
A group health plan that provides coverage on the date of enactment 
of this Act may provide for the enrolling of new employees (and 
their families) in such plan, and this subtitle and subtitle A (and 
the amendments made by such subtitles) shall not apply with 
respect to such plan and such new employees (and their families).
H. R. 3590—44 
(d) EFFECT ON COLLECTIVE BARGAINING AGREEMENTS.—In the 
case of health insurance coverage maintained pursuant to one or 
more collective bargaining agreements between employee represent-
atives and one or more employers that was ratified before the 
date of enactment of this Act, the provisions of this subtitle and 
subtitle A (and the amendments made by such subtitles) shall 
not apply until the date on which the last of the collective bar-
gaining agreements relating to the coverage terminates. Any cov-
erage amendment made pursuant to a collective bargaining agree-
ment relating to the coverage which amends the coverage solely 
to conform to any requirement added by this subtitle or subtitle 
A (or amendments) shall not be treated as a termination of such 
collective bargaining agreement. 
(e) DEFINITION.—In this title, the term ‘‘grandfathered health 
plan’’ means any group health plan or health insurance coverage 
to which this section applies. 
SEC. 1252. RATING REFORMS MUST APPLY UNIFORMLY TO ALL 
HEALTH INSURANCE ISSUERS AND GROUP HEALTH 
PLANS. 
Any standard or requirement adopted by a State pursuant 
to this title, or any amendment made by this title, shall be applied 
uniformly to all health plans in each insurance market to which 
the standard and requirements apply. The preceding sentence shall 
also apply to a State standard or requirement relating to the 
standard or requirement required by this title (or any such amend-
ment) that is not the same as the standard or requirement but 
that is not preempted under section 1321(d). 
SEC. 1253. EFFECTIVE DATES. 
This subtitle (and the amendments made by this subtitle) shall 
become effective for plan years beginning on or after January 1, 
2014. 
Subtitle D—Available Coverage Choices for 
All Americans 
PART I—ESTABLISHMENT OF QUALIFIED 
HEALTH PLANS 
SEC. 1301. QUALIFIED HEALTH PLAN DEFINED. 
(a) QUALIFIED HEALTH PLAN.—In this title: 
(1) IN GENERAL.—The term ‘‘qualified health plan’’ means 
a health plan that— 
(A) has in effect a certification (which may include 
a seal or other indication of approval) that such plan meets 
the criteria for certification described in section 1311(c) 
issued or recognized by each Exchange through which such 
plan is offered; 
(B) provides the essential health benefits package 
described in section 1302(a); and 
(C) is offered by a health insurance issuer that— 
(i) is licensed and in good standing to offer health 
insurance coverage in each State in which such issuer 
offers health insurance coverage under this title;
H. R. 3590—45 
(ii) agrees to offer at least one qualified health 
plan in the silver level and at least one plan in the 
gold level in each such Exchange; 
(iii) agrees to charge the same premium rate for 
each qualified health plan of the issuer without regard 
to whether the plan is offered through an Exchange 
or whether the plan is offered directly from the issuer 
or through an agent; and 
(iv) complies with the regulations developed by 
the Secretary under section 1311(d) and such other 
requirements as an applicable Exchange may establish. 
(2) INCLUSION OF CO-OP PLANS AND COMMUNITY HEALTH 
INSURANCE OPTION.—Any reference in this title to a qualified 
health plan shall be deemed to include a qualified health plan 
offered through the CO-OP program under section 1322 or 
a community health insurance option under section 1323, unless 
specifically provided for otherwise. 
(b) TERMS RELATING TO HEALTH PLANS.—In this title: 
(1) HEALTH PLAN.— 
(A) IN GENERAL.—The term ‘‘health plan’’ means health 
insurance coverage and a group health plan. 
(B) EXCEPTION FOR SELF-INSURED PLANS AND MEWAS.— 
Except to the extent specifically provided by this title, 
the term ‘‘health plan’’ shall not include a group health 
plan or multiple employer welfare arrangement to the 
extent the plan or arrangement is not subject to State 
insurance regulation under section 514 of the Employee 
Retirement Income Security Act of 1974. 
(2) HEALTH INSURANCE COVERAGE AND ISSUER.—The terms 
‘‘health insurance coverage’’ and ‘‘health insurance issuer’’ have 
the meanings given such terms by section 2791(b) of the Public 
Health Service Act. 
(3) GROUP HEALTH PLAN.—The term ‘‘group health plan’’ 
has the meaning given such term by section 2791(a) of the 
Public Health Service Act. 
SEC. 1302. ESSENTIAL HEALTH BENEFITS REQUIREMENTS. 
(a) ESSENTIAL HEALTH BENEFITS PACKAGE.—In this title, the 
term ‘‘essential health benefits package’’ means, with respect to 
any health plan, coverage that— 
(1) provides for the essential health benefits defined by 
the Secretary under subsection (b); 
(2) limits cost-sharing for such coverage in accordance with 
subsection (c); and 
(3) subject to subsection (e), provides either the bronze, 
silver, gold, or platinum level of coverage described in sub-
section (d). 
(b) ESSENTIAL HEALTH BENEFITS.— 
(1) IN GENERAL.—Subject to paragraph (2), the Secretary 
shall define the essential health benefits, except that such 
benefits shall include at least the following general categories 
and the items and services covered within the categories: 
(A) Ambulatory patient services. 
(B) Emergency services. 
(C) Hospitalization. 
(D) Maternity and newborn care.
H. R. 3590—46 
(E) Mental health and substance use disorder services, 
including behavioral health treatment. 
(F) Prescription drugs. 
(G) Rehabilitative and habilitative services and devices. 
(H) Laboratory services. 
(I) Preventive and wellness services and chronic dis-
ease management. 
(J) Pediatric services, including oral and vision care. 
(2) LIMITATION.— 
(A) IN GENERAL.—The Secretary shall ensure that the 
scope of the essential health benefits under paragraph (1) 
is equal to the scope of benefits provided under a typical 
employer plan, as determined by the Secretary. To inform 
this determination, the Secretary of Labor shall conduct 
a survey of employer-sponsored coverage to determine the 
benefits typically covered by employers, including multiem-
ployer plans, and provide a report on such survey to the 
Secretary. 
(B) CERTIFICATION.—In defining the essential health 
benefits described in paragraph (1), and in revising the 
benefits under paragraph (4)(H), the Secretary shall submit 
a report to the appropriate committees of Congress con-
taining a certification from the Chief Actuary of the Centers 
for Medicare & Medicaid Services that such essential health 
benefits meet the limitation described in paragraph (2). 
(3) NOTICE AND HEARING.—In defining the essential health 
benefits described in paragraph (1), and in revising the benefits 
under paragraph (4)(H), the Secretary shall provide notice and 
an opportunity for public comment. 
(4) REQUIRED ELEMENTS FOR CONSIDERATION.—In defining 
the essential health benefits under paragraph (1), the Secretary 
shall— 
(A) ensure that such essential health benefits reflect 
an appropriate balance among the categories described in 
such subsection, so that benefits are not unduly weighted 
toward any category; 
(B) not make coverage decisions, determine reimburse-
ment rates, establish incentive programs, or design benefits 
in ways that discriminate against individuals because of 
their age, disability, or expected length of life; 
(C) take into account the health care needs of diverse 
segments of the population, including women, children, 
persons with disabilities, and other groups; 
(D) ensure that health benefits established as essential 
not be subject to denial to individuals against their wishes 
on the basis of the individuals’ age or expected length 
of life or of the individuals’ present or predicted disability, 
degree of medical dependency, or quality of life; 
(E) provide that a qualified health plan shall not be 
treated as providing coverage for the essential health bene-
fits described in paragraph (1) unless the plan provides 
that— 
(i) coverage for emergency department services will 
be provided without imposing any requirement under 
the plan for prior authorization of services or any 
limitation on coverage where the provider of services 
does not have a contractual relationship with the plan
H. R. 3590—47 
for the providing of services that is more restrictive 
than the requirements or limitations that apply to 
emergency department services received from providers 
who do have such a contractual relationship with the 
plan; and 
(ii) if such services are provided out-of-network, 
the 
cost-sharing 
requirement 
(expressed 
as 
a 
copayment amount or coinsurance rate) is the same 
requirement that would apply if such services were 
provided in-network; 
(F) provide that if a plan described in section 
1311(b)(2)(B)(ii) (relating to stand-alone dental benefits 
plans) is offered through an Exchange, another health plan 
offered through such Exchange shall not fail to be treated 
as a qualified health plan solely because the plan does 
not offer coverage of benefits offered through the stand- 
alone plan that are otherwise required under paragraph 
(1)(J); and 
(G) periodically review the essential health benefits 
under paragraph (1), and provide a report to Congress 
and the public that contains— 
(i) an assessment of whether enrollees are facing 
any difficulty accessing needed services for reasons 
of coverage or cost; 
(ii) an assessment of whether the essential health 
benefits needs to be modified or updated to account 
for changes in medical evidence or scientific advance-
ment; 
(iii) information on how the essential health bene-
fits will be modified to address any such gaps in access 
or changes in the evidence base; 
(iv) an assessment of the potential of additional 
or expanded benefits to increase costs and the inter-
actions between the addition or expansion of benefits 
and reductions in existing benefits to meet actuarial 
limitations described in paragraph (2); and 
(H) periodically update the essential health benefits 
under paragraph (1) to address any gaps in access to cov-
erage or changes in the evidence base the Secretary identi-
fies in the review conducted under subparagraph (G). 
(5) RULE OF CONSTRUCTION.—Nothing in this title shall 
be construed to prohibit a health plan from providing benefits 
in excess of the essential health benefits described in this 
subsection. 
(c) REQUIREMENTS RELATING TO COST-SHARING.— 
(1) ANNUAL LIMITATION ON COST-SHARING.— 
(A) 2014.—The cost-sharing incurred under a health 
plan with respect to self-only coverage or coverage other 
than self-only coverage for a plan year beginning in 2014 
shall not exceed the dollar amounts in effect under section 
223(c)(2)(A)(ii) of the Internal Revenue Code of 1986 for 
self-only and family coverage, respectively, for taxable years 
beginning in 2014. 
(B) 2015 AND LATER.—In the case of any plan year 
beginning in a calendar year after 2014, the limitation 
under this paragraph shall—
H. R. 3590—48 
(i) in the case of self-only coverage, be equal to 
the dollar amount under subparagraph (A) for self- 
only coverage for plan years beginning in 2014, 
increased by an amount equal to the product of that 
amount and the premium adjustment percentage under 
paragraph (4) for the calendar year; and 
(ii) in the case of other coverage, twice the amount 
in effect under clause (i). 
If the amount of any increase under clause (i) is not a 
multiple of $50, such increase shall be rounded to the 
next lowest multiple of $50. 
(2) ANNUAL LIMITATION ON DEDUCTIBLES FOR EMPLOYER- 
SPONSORED PLANS.— 
(A) IN GENERAL.—In the case of a health plan offered 
in the small group market, the deductible under the plan 
shall not exceed— 
(i) $2,000 in the case of a plan covering a single 
individual; and 
(ii) $4,000 in the case of any other plan. 
The amounts under clauses (i) and (ii) may be increased 
by the maximum amount of reimbursement which is 
reasonably available to a participant under a flexible 
spending arrangement described in section 106(c)(2) of the 
Internal Revenue Code of 1986 (determined without regard 
to any salary reduction arrangement). 
(B) INDEXING OF LIMITS.—In the case of any plan year 
beginning in a calendar year after 2014— 
(i) the dollar amount under subparagraph (A)(i) 
shall be increased by an amount equal to the product 
of that amount and the premium adjustment percent-
age under paragraph (4) for the calendar year; and 
(ii) the dollar amount under subparagraph (A)(ii) 
shall be increased to an amount equal to twice the 
amount in effect under subparagraph (A)(i) for plan 
years beginning in the calendar year, determined after 
application of clause (i). 
If the amount of any increase under clause (i) is not a 
multiple of $50, such increase shall be rounded to the 
next lowest multiple of $50. 
(C) ACTUARIAL VALUE.—The limitation under this para-
graph shall be applied in such a manner so as to not 
affect the actuarial value of any health plan, including 
a plan in the bronze level. 
(D) COORDINATION WITH PREVENTIVE LIMITS.—Nothing 
in this paragraph shall be construed to allow a plan to 
have a deductible under the plan apply to benefits described 
in section 2713 of the Public Health Service Act. 
(3) COST-SHARING.—In this title— 
(A) IN GENERAL.—The term ‘‘cost-sharing’’ includes— 
(i) deductibles, coinsurance, copayments, or similar 
charges; and 
(ii) any other expenditure required of an insured 
individual which is a qualified medical expense (within 
the meaning of section 223(d)(2) of the Internal Rev-
enue Code of 1986) with respect to essential health 
benefits covered under the plan.
H. R. 3590—49 
(B) EXCEPTIONS.—Such term does not include pre-
miums, balance billing amounts for non-network providers, 
or spending for non-covered services. 
(4) PREMIUM ADJUSTMENT PERCENTAGE.—For purposes of 
paragraphs (1)(B)(i) and (2)(B)(i), the premium adjustment 
percentage for any calendar year is the percentage (if any) 
by which the average per capita premium for health insurance 
coverage in the United States for the preceding calendar year 
(as estimated by the Secretary no later than October 1 of 
such preceding calendar year) exceeds such average per capita 
premium for 2013 (as determined by the Secretary). 
(d) LEVELS OF COVERAGE.— 
(1) LEVELS OF COVERAGE DEFINED.—The levels of coverage 
described in this subsection are as follows: 
(A) BRONZE LEVEL.—A plan in the bronze level shall 
provide a level of coverage that is designed to provide 
benefits that are actuarially equivalent to 60 percent of 
the full actuarial value of the benefits provided under 
the plan. 
(B) SILVER LEVEL.—A plan in the silver level shall 
provide a level of coverage that is designed to provide 
benefits that are actuarially equivalent to 70 percent of 
the full actuarial value of the benefits provided under 
the plan. 
(C) GOLD LEVEL.—A plan in the gold level shall provide 
a level of coverage that is designed to provide benefits 
that are actuarially equivalent to 80 percent of the full 
actuarial value of the benefits provided under the plan. 
(D) PLATINUM LEVEL.—A plan in the platinum level 
shall provide a level of coverage that is designed to provide 
benefits that are actuarially equivalent to 90 percent of 
the full actuarial value of the benefits provided under 
the plan. 
(2) ACTUARIAL VALUE.— 
(A) IN GENERAL.—Under regulations issued by the Sec-
retary, the level of coverage of a plan shall be determined 
on the basis that the essential health benefits described 
in subsection (b) shall be provided to a standard population 
(and without regard to the population the plan may actually 
provide benefits to). 
(B) EMPLOYER
CONTRIBUTIONS.—The Secretary may 
issue regulations under which employer contributions to 
a health savings account (within the meaning of section 
223 of the Internal Revenue Code of 1986) may be taken 
into account in determining the level of coverage for a 
plan of the employer. 
(C) APPLICATION.—In determining under this title, the 
Public Health Service Act, or the Internal Revenue Code 
of 1986 the percentage of the total allowed costs of benefits 
provided under a group health plan or health insurance 
coverage that are provided by such plan or coverage, the 
rules contained in the regulations under this paragraph 
shall apply. 
(3) ALLOWABLE
VARIANCE.—The Secretary shall develop 
guidelines to provide for a de minimis variation in the actuarial 
valuations used in determining the level of coverage of a plan 
to account for differences in actuarial estimates.
H. R. 3590—50 
(4) PLAN
REFERENCE.—In this title, any reference to a 
bronze, silver, gold, or platinum plan shall be treated as a 
reference to a qualified health plan providing a bronze, silver, 
gold, or platinum level of coverage, as the case may be. 
(e) CATASTROPHIC PLAN.— 
(1) IN GENERAL.—A health plan not providing a bronze, 
silver, gold, or platinum level of coverage shall be treated 
as meeting the requirements of subsection (d) with respect 
to any plan year if— 
(A) the only individuals who are eligible to enroll in 
the plan are individuals described in paragraph (2); and 
(B) the plan provides— 
(i) except as provided in clause (ii), the essential 
health benefits determined under subsection (b), except 
that the plan provides no benefits for any plan year 
until the individual has incurred cost-sharing expenses 
in an amount equal to the annual limitation in effect 
under subsection (c)(1) for the plan year (except as 
provided for in section 2713); and 
(ii) coverage for at least three primary care visits. 
(2) INDIVIDUALS ELIGIBLE FOR ENROLLMENT.—An individual 
is described in this paragraph for any plan year if the indi-
vidual— 
(A) has not attained the age of 30 before the beginning 
of the plan year; or 
(B) has a certification in effect for any plan year under 
this title that the individual is exempt from the require-
ment under section 5000A of the Internal Revenue Code 
of 1986 by reason of— 
(i) section 5000A(e)(1) of such Code (relating to 
individuals without affordable coverage); or 
(ii) section 5000A(e)(5) of such Code (relating to 
individuals with hardships). 
(3) RESTRICTION TO INDIVIDUAL MARKET.—If a health insur-
ance issuer offers a health plan described in this subsection, 
the issuer may only offer the plan in the individual market. 
(f) CHILD-ONLY PLANS.—If a qualified health plan is offered 
through the Exchange in any level of coverage specified under 
subsection (d), the issuer shall also offer that plan through the 
Exchange in that level as a plan in which the only enrollees are 
individuals who, as of the beginning of a plan year, have not 
attained the age of 21, and such plan shall be treated as a qualified 
health plan. 
SEC. 1303. SPECIAL RULES. 
(a) SPECIAL RULES RELATING TO COVERAGE OF ABORTION SERV-
ICES.— 
(1) VOLUNTARY CHOICE OF COVERAGE OF ABORTION SERV-
ICES.— 
(A) IN GENERAL.—Notwithstanding any other provision 
of this title (or any amendment made by this title), and 
subject to subparagraphs (C) and (D)— 
(i) nothing in this title (or any amendment made 
by this title), shall be construed to require a qualified 
health plan to provide coverage of services described 
in subparagraph (B)(i) or (B)(ii) as part of its essential 
health benefits for any plan year; and
H. R. 3590—51 
(ii) the issuer of a qualified health plan shall deter-
mine whether or not the plan provides coverage of 
services described in subparagraph (B)(i) or (B)(ii) as 
part of such benefits for the plan year. 
(B) ABORTION SERVICES.— 
(i) ABORTIONS
FOR
WHICH
PUBLIC
FUNDING
IS 
PROHIBITED.—The services described in this clause are 
abortions for which the expenditure of Federal funds 
appropriated for the Department of Health and Human 
Services is not permitted, based on the law as in effect 
as of the date that is 6 months before the beginning 
of the plan year involved. 
(ii) ABORTIONS
FOR
WHICH
PUBLIC
FUNDING
IS 
ALLOWED.—The services described in this clause are 
abortions for which the expenditure of Federal funds 
appropriated for the Department of Health and Human 
Services is permitted, based on the law as in effect 
as of the date that is 6 months before the beginning 
of the plan year involved. 
(C) PROHIBITION
ON
FEDERAL
FUNDS
FOR
ABORTION 
SERVICES IN COMMUNITY HEALTH INSURANCE OPTION.— 
(i) DETERMINATION BY SECRETARY.—The Secretary 
may not determine, in accordance with subparagraph 
(A)(ii), that the community health insurance option 
established under section 1323 shall provide coverage 
of services described in subparagraph (B)(i) as part 
of benefits for the plan year unless the Secretary— 
(I) assures compliance with the requirements 
of paragraph (2); 
(II) assures, in accordance with applicable 
provisions 
of 
generally 
accepted 
accounting 
requirements, circulars on funds management of 
the Office of Management and Budget, and guid-
ance on accounting of the Government Account-
ability Office, that no Federal funds are used for 
such coverage; and 
(III) notwithstanding section 1323(e)(1)(C) or 
any other provision of this title, takes all necessary 
steps to assure that the United States does not 
bear the insurance risk for a community health 
insurance option’s coverage of services described 
in subparagraph (B)(i). 
(ii) STATE REQUIREMENT.—If a State requires, in 
addition to the essential health benefits required under 
section 1323(b)(3) (A), coverage of services described 
in subparagraph (B)(i) for enrollees of a community 
health insurance option offered in such State, the State 
shall assure that no funds flowing through or from 
the community health insurance option, and no other 
Federal funds, pay or defray the cost of providing cov-
erage of services described in subparagraph (B)(i). The 
United States shall not bear the insurance risk for 
a State’s required coverage of services described in 
subparagraph (B)(i). 
(iii) EXCEPTIONS.—Nothing in this subparagraph 
shall apply to coverage of services described in subpara-
graph (B)(ii) by the community health insurance
H. R. 3590—52 
option. Services described in subparagraph (B)(ii) shall 
be covered to the same extent as such services are 
covered under title XIX of the Social Security Act. 
(D) ASSURED
AVAILABILITY
OF
VARIED
COVERAGE 
THROUGH EXCHANGES.— 
(i) IN GENERAL.—The Secretary shall assure that 
with respect to qualified health plans offered in any 
Exchange established pursuant to this title— 
(I) there is at least one such plan that provides 
coverage of services described in clauses (i) and 
(ii) of subparagraph (B); and 
(II) there is at least one such plan that does 
not provide coverage of services described in 
subparagraph (B)(i). 
(ii) SPECIAL RULES.—For purposes of clause (i)— 
(I) a plan shall be treated as described in 
clause (i)(II) if the plan does not provide coverage 
of services described in either subparagraph (B)(i) 
or (B)(ii); and 
(II) if a State has one Exchange covering more 
than 1 insurance market, the Secretary shall meet 
the requirements of clause (i) separately with 
respect to each such market. 
(2) PROHIBITION ON THE USE OF FEDERAL FUNDS.— 
(A) IN GENERAL.—If a qualified health plan provides 
coverage of services described in paragraph (1)(B)(i), the 
issuer of the plan shall not use any amount attributable 
to any of the following for purposes of paying for such 
services: 
(i) The credit under section 36B of the Internal 
Revenue Code of 1986 (and the amount (if any) of 
the advance payment of the credit under section 1412 
of the Patient Protection and Affordable Care Act). 
(ii) Any cost-sharing reduction under section 1402 
of thePatient Protection and Affordable Care Act (and 
the amount (if any) of the advance payment of the 
reduction under section 1412 of the Patient Protection 
and Affordable Care Act). 
(B) SEGREGATION OF FUNDS.—In the case of a plan 
to which subparagraph (A) applies, the issuer of the plan 
shall, out of amounts not described in subparagraph (A), 
segregate an amount equal to the actuarial amounts deter-
mined under subparagraph (C) for all enrollees from the 
amounts described in subparagraph (A). 
(C) ACTUARIAL
VALUE
OF
OPTIONAL
SERVICE
COV-
ERAGE.— 
(i) IN GENERAL.—The Secretary shall estimate the 
basic per enrollee, per month cost, determined on an 
average actuarial basis, for including coverage under 
a qualified health plan of the services described in 
paragraph (1)(B)(i). 
(ii) CONSIDERATIONS.—In making such estimate, 
the Secretary— 
(I) may take into account the impact on overall 
costs of the inclusion of such coverage, but may 
not take into account any cost reduction estimated
H. R. 3590—53 
to result from such services, including prenatal 
care, delivery, or postnatal care; 
(II) shall estimate such costs as if such cov-
erage were included for the entire population cov-
ered; and 
(III) may not estimate such a cost at less 
than $1 per enrollee, per month. 
(3) PROVIDER
CONSCIENCE
PROTECTIONS.—No individual 
health care provider or health care facility may be discriminated 
against because of a willingness or an unwillingness, if doing 
so is contrary to the religious or moral beliefs of the provider 
or facility, to provide, pay for, provide coverage of, or refer 
for abortions. 
(b) APPLICATION
OF STATE
AND FEDERAL LAWS REGARDING 
ABORTION.— 
(1) NO PREEMPTION OF STATE LAWS REGARDING ABORTION.— 
Nothing in this Act shall be construed to preempt or otherwise 
have any effect on State laws regarding the prohibition of 
(or requirement of) coverage, funding, or procedural require-
ments on abortions, including parental notification or consent 
for the performance of an abortion on a minor. 
(2) NO EFFECT ON FEDERAL LAWS REGARDING ABORTION.— 
(A) IN GENERAL.—Nothing in this Act shall be con-
strued to have any effect on Federal laws regarding— 
(i) conscience protection; 
(ii) willingness or refusal to provide abortion; and 
(iii) discrimination on the basis of the willingness 
or refusal to provide, pay for, cover, or refer for abortion 
or to provide or participate in training to provide abor-
tion. 
(3) NO EFFECT ON FEDERAL CIVIL RIGHTS LAW.—Nothing 
in this subsection shall alter the rights and obligations of 
employees and employers under title VII of the Civil Rights 
Act of 1964. 
(c) APPLICATION OF EMERGENCY SERVICES LAWS.—Nothing in 
this Act shall be construed to relieve any health care provider 
from providing emergency services as required by State or Federal 
law, including section 1867 of the Social Security Act (popularly 
known as ‘‘EMTALA’’). 
SEC. 1304. RELATED DEFINITIONS. 
(a) DEFINITIONS RELATING TO MARKETS.—In this title: 
(1) GROUP MARKET.—The term ‘‘group market’’ means the 
health insurance market under which individuals obtain health 
insurance coverage (directly or through any arrangement) on 
behalf of themselves (and their dependents) through a group 
health plan maintained by an employer. 
(2) INDIVIDUAL
MARKET.—The term ‘‘individual market’’ 
means the market for health insurance coverage offered to 
individuals other than in connection with a group health plan. 
(3) LARGE AND SMALL GROUP MARKETS.—The terms ‘‘large 
group market’’ and ‘‘small group market’’ mean the health 
insurance market under which individuals obtain health insur-
ance coverage (directly or through any arrangement) on behalf 
of themselves (and their dependents) through a group health 
plan maintained by a large employer (as defined in subsection
H. R. 3590—54 
(b)(1)) or by a small employer (as defined in subsection (b)(2)), 
respectively. 
(b) EMPLOYERS.—In this title: 
(1) LARGE EMPLOYER.—The term ‘‘large employer’’ means, 
in connection with a group health plan with respect to a cal-
endar year and a plan year, an employer who employed an 
average of at least 101 employees on business days during 
the preceding calendar year and who employs at least 1 
employee on the first day of the plan year. 
(2) SMALL EMPLOYER.—The term ‘‘small employer’’ means, 
in connection with a group health plan with respect to a cal-
endar year and a plan year, an employer who employed an 
average of at least 1 but not more than 100 employees on 
business days during the preceding calendar year and who 
employs at least 1 employee on the first day of the plan year. 
(3) STATE
OPTION
TO
TREAT
EMPLOYEES
AS
SMALL.— 
In the case of plan years beginning before January 1, 2016, 
a State may elect to apply this subsection by substituting 
‘‘51 employees’’ for ‘‘101 employees’’ in paragraph (1) and by 
substituting ‘‘50 employees’’ for ‘‘100 employees’’ in paragraph 
(2). 
(4) RULES FOR DETERMINING EMPLOYER SIZE.—For purposes 
of this subsection— 
(A) 
APPLICATION
OF
AGGREGATION
RULE
FOR 
EMPLOYERS.—All persons treated as a single employer 
under subsection (b), (c), (m), or (o) of section 414 of the 
Internal Revenue Code of 1986 shall be treated as 1 
employer. 
(B) EMPLOYERS
NOT
IN
EXISTENCE
IN
PRECEDING 
YEAR.—In the case of an employer which was not in exist-
ence throughout the preceding calendar year, the deter-
mination of whether such employer is a small or large 
employer shall be based on the average number of 
employees that it is reasonably expected such employer 
will employ on business days in the current calendar year. 
(C) PREDECESSORS.—Any reference in this subsection 
to an employer shall include a reference to any predecessor 
of such employer. 
(D) CONTINUATION
OF
PARTICIPATION
FOR
GROWING 
SMALL EMPLOYERS.—If— 
(i) a qualified employer that is a small employer 
makes enrollment in qualified health plans offered in 
the small group market available to its employees 
through an Exchange; and 
(ii) the employer ceases to be a small employer 
by reason of an increase in the number of employees 
of such employer; 
the employer shall continue to be treated as a small 
employer for purposes of this subtitle for the period begin-
ning with the increase and ending with the first day on 
which the employer does not make such enrollment avail-
able to its employees. 
(c) SECRETARY.—In this title, the term ‘‘Secretary’’ means the 
Secretary of Health and Human Services. 
(d) STATE.—In this title, the term ‘‘State’’ means each of the 
50 States and the District of Columbia.
H. R. 3590—55 
PART II—CONSUMER CHOICES AND INSUR-
ANCE 
COMPETITION 
THROUGH 
HEALTH 
BENEFIT EXCHANGES 
SEC. 1311. AFFORDABLE CHOICES OF HEALTH BENEFIT PLANS. 
(a) ASSISTANCE TO STATES TO ESTABLISH AMERICAN HEALTH 
BENEFIT EXCHANGES.— 
(1) PLANNING AND ESTABLISHMENT GRANTS.—There shall 
be appropriated to the Secretary, out of any moneys in the 
Treasury not otherwise appropriated, an amount necessary to 
enable the Secretary to make awards, not later than 1 year 
after the date of enactment of this Act, to States in the amount 
specified in paragraph (2) for the uses described in paragraph 
(3). 
(2) AMOUNT SPECIFIED.—For each fiscal year, the Secretary 
shall determine the total amount that the Secretary will make 
available to each State for grants under this subsection. 
(3) USE OF FUNDS.—A State shall use amounts awarded 
under this subsection for activities (including planning activi-
ties) related to establishing an American Health Benefit 
Exchange, as described in subsection (b). 
(4) RENEWABILITY OF GRANT.— 
(A) IN GENERAL.—Subject to subsection (d)(4), the Sec-
retary may renew a grant awarded under paragraph (1) 
if the State recipient of such grant— 
(i) is making progress, as determined by the Sec-
retary, toward— 
(I) establishing an Exchange; and 
(II) implementing the reforms described in 
subtitles A and C (and the amendments made 
by such subtitles); and 
(ii) is meeting such other benchmarks as the Sec-
retary may establish. 
(B) LIMITATION.—No grant shall be awarded under 
this subsection after January 1, 2015. 
(5) TECHNICAL
ASSISTANCE
TO
FACILITATE
PARTICIPATION 
IN
SHOP
EXCHANGES.—The Secretary shall provide technical 
assistance to States to facilitate the participation of qualified 
small businesses in such States in SHOP Exchanges. 
(b) AMERICAN HEALTH BENEFIT EXCHANGES.— 
(1) IN GENERAL.—Each State shall, not later than January 
1, 2014, establish an American Health Benefit Exchange 
(referred to in this title as an ‘‘Exchange’’) for the State that— 
(A) facilitates the purchase of qualified health plans; 
(B) provides for the establishment of a Small Business 
Health Options Program (in this title referred to as a 
‘‘SHOP Exchange’’) that is designed to assist qualified 
employers in the State who are small employers in facili-
tating the enrollment of their employees in qualified health 
plans offered in the small group market in the State; 
and 
(C) meets the requirements of subsection (d). 
(2) MERGER OF INDIVIDUAL AND SHOP EXCHANGES.—A State 
may elect to provide only one Exchange in the State for pro-
viding both Exchange and SHOP Exchange services to both 
qualified individuals and qualified small employers, but only
H. R. 3590—56 
if the Exchange has adequate resources to assist such individ-
uals and employers. 
(c) RESPONSIBILITIES OF THE SECRETARY.— 
(1) IN GENERAL.—The Secretary shall, by regulation, estab-
lish criteria for the certification of health plans as qualified 
health plans. Such criteria shall require that, to be certified, 
a plan shall, at a minimum— 
(A) meet marketing requirements, and not employ mar-
keting practices or benefit designs that have the effect 
of discouraging the enrollment in such plan by individuals 
with significant health needs; 
(B) ensure a sufficient choice of providers (in a manner 
consistent with applicable network adequacy provisions 
under section 2702(c) of the Public Health Service Act), 
and provide information to enrollees and prospective 
enrollees on the availability of in-network and out-of-net-
work providers; 
(C) include within health insurance plan networks 
those essential community providers, where available, that 
serve predominately low-income, medically-underserved 
individuals, such as health care providers defined in section 
340B(a)(4) of the Public Health Service Act and providers 
described in section 1927(c)(1)(D)(i)(IV) of the Social Secu-
rity Act as set forth by section 221 of Public Law 111– 
8, except that nothing in this subparagraph shall be con-
strued to require any health plan to provide coverage for 
any specific medical procedure; 
(D)(i) be accredited with respect to local performance 
on clinical quality measures such as the Healthcare 
Effectiveness Data and Information Set, patient experience 
ratings on a standardized Consumer Assessment of 
Healthcare Providers and Systems survey, as well as con-
sumer access, utilization management, quality assurance, 
provider credentialing, complaints and appeals, network 
adequacy and access, and patient information programs 
by any entity recognized by the Secretary for the accredita-
tion of health insurance issuers or plans (so long as any 
such entity has transparent and rigorous methodological 
and scoring criteria); or 
(ii) receive such accreditation within a period estab-
lished by an Exchange for such accreditation that is 
applicable to all qualified health plans; 
(E) 
implement 
a 
quality 
improvement 
strategy 
described in subsection (g)(1); 
(F) utilize a uniform enrollment form that qualified 
individuals and qualified employers may use (either elec-
tronically or on paper) in enrolling in qualified health plans 
offered through such Exchange, and that takes into account 
criteria that the National Association of Insurance Commis-
sioners develops and submits to the Secretary; 
(G) utilize the standard format established for pre-
senting health benefits plan options; and 
(H) provide information to enrollees and prospective 
enrollees, and to each Exchange in which the plan is 
offered, on any quality measures for health plan perform-
ance endorsed under section 399JJ of the Public Health 
Service Act, as applicable.
H. R. 3590—57 
(2) RULE OF CONSTRUCTION.—Nothing in paragraph (1)(C) 
shall be construed to require a qualified health plan to contract 
with a provider described in such paragraph if such provider 
refuses to accept the generally applicable payment rates of 
such plan. 
(3) RATING SYSTEM.—The Secretary shall develop a rating 
system that would rate qualified health plans offered through 
an Exchange in each benefits level on the basis of the relative 
quality and price. The Exchange shall include the quality rating 
in the information provided to individuals and employers 
through the Internet portal established under paragraph (4). 
(4) ENROLLEE SATISFACTION SYSTEM.—The Secretary shall 
develop an enrollee satisfaction survey system that would 
evaluate the level of enrollee satisfaction with qualified health 
plans offered through an Exchange, for each such qualified 
health plan that had more than 500 enrollees in the previous 
year. The Exchange shall include enrollee satisfaction informa-
tion in the information provided to individuals and employers 
through the Internet portal established under paragraph (5) 
in a manner that allows individuals to easily compare enrollee 
satisfaction levels between comparable plans. 
(5) INTERNET PORTALS.—The Secretary shall— 
(A) continue to operate, maintain, and update the 
Internet portal developed under section 1103(a) and to 
assist States in developing and maintaining their own such 
portal; and 
(B) make available for use by Exchanges a model tem-
plate for an Internet portal that may be used to direct 
qualified individuals and qualified employers to qualified 
health plans, to assist such individuals and employers in 
determining whether they are eligible to participate in 
an Exchange or eligible for a premium tax credit or cost- 
sharing reduction, and to present standardized information 
(including quality ratings) regarding qualified health plans 
offered through an Exchange to assist consumers in making 
easy health insurance choices. 
Such template shall include, with respect to each qualified 
health plan offered through the Exchange in each rating area, 
access to the uniform outline of coverage the plan is required 
to provide under section 2716 of the Public Health Service 
Act and to a copy of the plan’s written policy. 
(6) ENROLLMENT PERIODS.—The Secretary shall require an 
Exchange to provide for— 
(A) an initial open enrollment, as determined by the 
Secretary (such determination to be made not later than 
July 1, 2012); 
(B) annual open enrollment periods, as determined 
by the Secretary for calendar years after the initial enroll-
ment period; 
(C) special enrollment periods specified in section 9801 
of the Internal Revenue Code of 1986 and other special 
enrollment periods under circumstances similar to such 
periods under part D of title XVIII of the Social Security 
Act; and 
(D) special monthly enrollment periods for Indians (as 
defined in section 4 of the Indian Health Care Improvement 
Act).
H. R. 3590—58 
(d) REQUIREMENTS.— 
(1) IN GENERAL.—An Exchange shall be a governmental 
agency or nonprofit entity that is established by a State. 
(2) OFFERING OF COVERAGE.— 
(A) IN GENERAL.—An Exchange shall make available 
qualified health plans to qualified individuals and qualified 
employers. 
(B) LIMITATION.— 
(i) IN
GENERAL.—An Exchange may not make 
available any health plan that is not a qualified health 
plan. 
(ii) OFFERING OF STAND-ALONE DENTAL BENEFITS.— 
Each Exchange within a State shall allow an issuer 
of a plan that only provides limited scope dental bene-
fits meeting the requirements of section 9832(c)(2)(A) 
of the Internal Revenue Code of 1986 to offer the 
plan through the Exchange (either separately or in 
conjunction with a qualified health plan) if the plan 
provides pediatric dental benefits meeting the require-
ments of section 1302(b)(1)(J)). 
(3) RULES RELATING TO ADDITIONAL REQUIRED BENEFITS.— 
(A) IN GENERAL.—Except as provided in subparagraph 
(B), an Exchange may make available a qualified health 
plan notwithstanding any provision of law that may require 
benefits other than the essential health benefits specified 
under section 1302(b). 
(B) STATES MAY REQUIRE ADDITIONAL BENEFITS.— 
(i) IN GENERAL.—Subject to the requirements of 
clause (ii), a State may require that a qualified health 
plan offered in such State offer benefits in addition 
to the essential health benefits specified under section 
1302(b). 
(ii) STATE MUST ASSUME COST.—A State shall make 
payments to or on behalf of an individual eligible for 
the premium tax credit under section 36B of the 
Internal Revenue Code of 1986 and any cost-sharing 
reduction under section 1402 to defray the cost to 
the individual of any additional benefits described in 
clause (i) which are not eligible for such credit or 
reduction under section 36B(b)(3)(D) of such Code and 
section 1402(c)(4). 
(4) FUNCTIONS.—An Exchange shall, at a minimum— 
(A) implement procedures for the certification, recertifi-
cation, and decertification, consistent with guidelines devel-
oped by the Secretary under subsection (c), of health plans 
as qualified health plans; 
(B) provide for the operation of a toll-free telephone 
hotline to respond to requests for assistance; 
(C) maintain an Internet website through which 
enrollees and prospective enrollees of qualified health plans 
may obtain standardized comparative information on such 
plans; 
(D) assign a rating to each qualified health plan offered 
through such Exchange in accordance with the criteria 
developed by the Secretary under subsection (c)(3); 
(E) utilize a standardized format for presenting health 
benefits plan options in the Exchange, including the use
H. R. 3590—59 
of the uniform outline of coverage established under section 
2715 of the Public Health Service Act; 
(F) in accordance with section 1413, inform individuals 
of eligibility requirements for the medicaid program under 
title XIX of the Social Security Act, the CHIP program 
under title XXI of such Act, or any applicable State or 
local public program and if through screening of the 
application by the Exchange, the Exchange determines that 
such individuals are eligible for any such program, enroll 
such individuals in such program; 
(G) establish and make available by electronic means 
a calculator to determine the actual cost of coverage after 
the application of any premium tax credit under section 
36B of the Internal Revenue Code of 1986 and any cost- 
sharing reduction under section 1402; 
(H) subject to section 1411, grant a certification 
attesting that, for purposes of the individual responsibility 
penalty under section 5000A of the Internal Revenue Code 
of 1986, an individual is exempt from the individual 
requirement or from the penalty imposed by such section 
because— 
(i) there is no affordable qualified health plan 
available through the Exchange, or the individual’s 
employer, covering the individual; or 
(ii) the individual meets the requirements for any 
other such exemption from the individual responsibility 
requirement or penalty; 
(I) transfer to the Secretary of the Treasury— 
(i) a list of the individuals who are issued a certifi-
cation under subparagraph (H), including the name 
and taxpayer identification number of each individual; 
(ii) the name and taxpayer identification number 
of each individual who was an employee of an employer 
but who was determined to be eligible for the premium 
tax credit under section 36B of the Internal Revenue 
Code of 1986 because— 
(I) the employer did not provide minimum 
essential coverage; or 
(II) the employer provided such minimum 
essential coverage but it was determined under 
section 36B(c)(2)(C) of such Code to either be 
unaffordable to the employee or not provide the 
required minimum actuarial value; and 
(iii) the name and taxpayer identification number 
of each individual who notifies the Exchange under 
section 1411(b)(4) that they have changed employers 
and of each individual who ceases coverage under a 
qualified health plan during a plan year (and the effec-
tive date of such cessation); 
(J) provide to each employer the name of each employee 
of the employer described in subparagraph (I)(ii) who ceases 
coverage under a qualified health plan during a plan year 
(and the effective date of such cessation); and 
(K) establish the Navigator program described in sub-
section (i). 
(5) FUNDING LIMITATIONS.—
H. R. 3590—60 
(A) NO FEDERAL FUNDS FOR CONTINUED OPERATIONS.— 
In establishing an Exchange under this section, the State 
shall ensure that such Exchange is self-sustaining begin-
ning on January 1, 2015, including allowing the Exchange 
to charge assessments or user fees to participating health 
insurance issuers, or to otherwise generate funding, to 
support its operations. 
(B) PROHIBITING WASTEFUL USE OF FUNDS.—In carrying 
out activities under this subsection, an Exchange shall 
not utilize any funds intended for the administrative and 
operational expenses of the Exchange for staff retreats, 
promotional giveaways, excessive executive compensation, 
or promotion of Federal or State legislative and regulatory 
modifications. 
(6) CONSULTATION.—An Exchange shall consult with stake-
holders relevant to carrying out the activities under this section, 
including— 
(A) health care consumers who are enrollees in quali-
fied health plans; 
(B) individuals and entities with experience in facili-
tating enrollment in qualified health plans; 
(C) representatives of small businesses and self- 
employed individuals; 
(D) State Medicaid offices; and 
(E) advocates for enrolling hard to reach populations. 
(7) PUBLICATION
OF
COSTS.—An Exchange shall publish 
the average costs of licensing, regulatory fees, and any other 
payments required by the Exchange, and the administrative 
costs of such Exchange, on an Internet website to educate 
consumers on such costs. Such information shall also include 
monies lost to waste, fraud, and abuse. 
(e) CERTIFICATION.— 
(1) IN GENERAL.—An Exchange may certify a health plan 
as a qualified health plan if— 
(A) such health plan meets the requirements for certifi-
cation as promulgated by the Secretary under subsection 
(c)(1); and 
(B) the Exchange determines that making available 
such health plan through such Exchange is in the interests 
of qualified individuals and qualified employers in the State 
or States in which such Exchange operates, except that 
the Exchange may not exclude a health plan— 
(i) on the basis that such plan is a fee-for-service 
plan; 
(ii) through the imposition of premium price con-
trols; or 
(iii) on the basis that the plan provides treatments 
necessary to prevent patients’ deaths in circumstances 
the Exchange determines are inappropriate or too 
costly. 
(2) PREMIUM CONSIDERATIONS.—The Exchange shall require 
health plans seeking certification as qualified health plans to 
submit a justification for any premium increase prior to 
implementation of the increase. Such plans shall prominently 
post such information on their websites. The Exchange may 
take this information, and the information and the rec-
ommendations provided to the Exchange by the State under
H. R. 3590—61 
section 2794(b)(1) of the Public Health Service Act (relating 
to patterns or practices of excessive or unjustified premium 
increases), into consideration when determining whether to 
make such health plan available through the Exchange. The 
Exchange shall take into account any excess of premium growth 
outside the Exchange as compared to the rate of such growth 
inside the Exchange, including information reported by the 
States. 
(f) FLEXIBILITY.— 
(1) REGIONAL
OR
OTHER
INTERSTATE
EXCHANGES.—An 
Exchange may operate in more than one State if— 
(A) each State in which such Exchange operates per-
mits such operation; and 
(B) the Secretary approves such regional or interstate 
Exchange. 
(2) SUBSIDIARY EXCHANGES.—A State may establish one 
or more subsidiary Exchanges if— 
(A) each such Exchange serves a geographically distinct 
area; and 
(B) the area served by each such Exchange is at least 
as large as a rating area described in section 2701(a) of 
the Public Health Service Act. 
(3) AUTHORITY TO CONTRACT.— 
(A) IN GENERAL.—A State may elect to authorize an 
Exchange established by the State under this section to 
enter into an agreement with an eligible entity to carry 
out 1 or more responsibilities of the Exchange. 
(B) ELIGIBLE
ENTITY.—In this paragraph, the term 
‘‘eligible entity’’ means— 
(i) a person— 
(I) incorporated under, and subject to the laws 
of, 1 or more States; 
(II) that has demonstrated experience on a 
State or regional basis in the individual and small 
group health insurance markets and in benefits 
coverage; and 
(III) that is not a health insurance issuer or 
that is treated under subsection (a) or (b) of section 
52 of the Internal Revenue Code of 1986 as a 
member of the same controlled group of corpora-
tions (or under common control with) as a health 
insurance issuer; or 
(ii) the State medicaid agency under title XIX of 
the Social Security Act. 
(g) REWARDING
QUALITY
THROUGH
MARKET-BASED
INCEN-
TIVES.— 
(1) STRATEGY
DESCRIBED.—A strategy described in this 
paragraph is a payment structure that provides increased 
reimbursement or other incentives for— 
(A) 
improving 
health 
outcomes 
through 
the 
implementation of activities that shall include quality 
reporting, effective case management, care coordination, 
chronic disease management, medication and care compli-
ance initiatives, including through the use of the medical 
home model, for treatment or services under the plan or 
coverage;
H. R. 3590—62 
(B) the implementation of activities to prevent hospital 
readmissions through a comprehensive program for hos-
pital discharge that includes patient-centered education 
and counseling, comprehensive discharge planning, and 
post discharge reinforcement by an appropriate health care 
professional; 
(C) the implementation of activities to improve patient 
safety and reduce medical errors through the appropriate 
use of best clinical practices, evidence based medicine, and 
health information technology under the plan or coverage; 
and 
(D) the implementation of wellness and health pro-
motion activities. 
(2) GUIDELINES.—The Secretary, in consultation with 
experts in health care quality and stakeholders, shall develop 
guidelines concerning the matters described in paragraph (1). 
(3) REQUIREMENTS.—The guidelines developed under para-
graph (2) shall require the periodic reporting to the applicable 
Exchange of the activities that a qualified health plan has 
conducted to implement a strategy described in paragraph (1). 
(h) QUALITY IMPROVEMENT.— 
(1) ENHANCING PATIENT SAFETY.—Beginning on January 
1, 2015, a qualified health plan may contract with— 
(A) a hospital with greater than 50 beds only if such 
hospital— 
(i) utilizes a patient safety evaluation system as 
described in part C of title IX of the Public Health 
Service Act; and 
(ii) implements a mechanism to ensure that each 
patient receives a comprehensive program for hospital 
discharge that includes patient-centered education and 
counseling, comprehensive discharge planning, and 
post discharge reinforcement by an appropriate health 
care professional; or 
(B) a health care provider only if such provider imple-
ments such mechanisms to improve health care quality 
as the Secretary may by regulation require. 
(2) EXCEPTIONS.—The Secretary may establish reasonable 
exceptions to the requirements described in paragraph (1). 
(3) ADJUSTMENT.—The Secretary may by regulation adjust 
the number of beds described in paragraph (1)(A). 
(i) NAVIGATORS.— 
(1) IN GENERAL.—An Exchange shall establish a program 
under which it awards grants to entities described in paragraph 
(2) to carry out the duties described in paragraph (3). 
(2) ELIGIBILITY.— 
(A) IN
GENERAL.—To be eligible to receive a grant 
under paragraph (1), an entity shall demonstrate to the 
Exchange involved that the entity has existing relation-
ships, or could readily establish relationships, with 
employers and employees, consumers (including uninsured 
and underinsured consumers), or self-employed individuals 
likely to be qualified to enroll in a qualified health plan. 
(B) TYPES.—Entities described in subparagraph (A) 
may include trade, industry, and professional associations, 
commercial fishing industry organizations, ranching and 
farming organizations, community and consumer-focused
H. R. 3590—63 
nonprofit groups, chambers of commerce, unions, small 
business development centers, other licensed insurance 
agents and brokers, and other entities that— 
(i) are capable of carrying out the duties described 
in paragraph (3); 
(ii) meet the standards described in paragraph 
(4); and 
(iii) provide information consistent with the stand-
ards developed under paragraph (5). 
(3) DUTIES.—An entity that serves as a navigator under 
a grant under this subsection shall— 
(A) conduct public education activities to raise aware-
ness of the availability of qualified health plans; 
(B) distribute fair and impartial information con-
cerning enrollment in qualified health plans, and the avail-
ability of premium tax credits under section 36B of the 
Internal Revenue Code of 1986 and cost-sharing reductions 
under section 1402; 
(C) facilitate enrollment in qualified health plans; 
(D) provide referrals to any applicable office of health 
insurance 
consumer 
assistance 
or 
health 
insurance 
ombudsman established under section 2793 of the Public 
Health Service Act, or any other appropriate State agency 
or agencies, for any enrollee with a grievance, complaint, 
or question regarding their health plan, coverage, or a 
determination under such plan or coverage; and 
(E) provide information in a manner that is culturally 
and linguistically appropriate to the needs of the population 
being served by the Exchange or Exchanges. 
(4) STANDARDS.— 
(A) IN GENERAL.—The Secretary shall establish stand-
ards for navigators under this subsection, including provi-
sions to ensure that any private or public entity that is 
selected as a navigator is qualified, and licensed if appro-
priate, to engage in the navigator activities described in 
this subsection and to avoid conflicts of interest. Under 
such standards, a navigator shall not— 
(i) be a health insurance issuer; or 
(ii) receive any consideration directly or indirectly 
from any health insurance issuer in connection with 
the 
enrollment 
of 
any 
qualified 
individuals 
or 
employees of a qualified employer in a qualified health 
plan. 
(5) FAIR AND IMPARTIAL INFORMATION AND SERVICES.—The 
Secretary, in collaboration with States, shall develop standards 
to ensure that information made available by navigators is 
fair, accurate, and impartial. 
(6) FUNDING.—Grants under this subsection shall be made 
from the operational funds of the Exchange and not Federal 
funds received by the State to establish the Exchange. 
(j) APPLICABILITY OF MENTAL HEALTH PARITY.—Section 2726 
of the Public Health Service Act shall apply to qualified health 
plans in the same manner and to the same extent as such section 
applies to health insurance issuers and group health plans. 
(k) CONFLICT.—An Exchange may not establish rules that con-
flict with or prevent the application of regulations promulgated 
by the Secretary under this subtitle.
H. R. 3590—64 
SEC. 1312. CONSUMER CHOICE. 
(a) CHOICE.— 
(1) QUALIFIED
INDIVIDUALS.—A qualified individual may 
enroll in any qualified health plan available to such individual. 
(2) QUALIFIED EMPLOYERS.— 
(A) EMPLOYER
MAY
SPECIFY
LEVEL.—A qualified 
employer may provide support for coverage of employees 
under a qualified health plan by selecting any level of 
coverage under section 1302(d) to be made available to 
employees through an Exchange. 
(B) EMPLOYEE MAY CHOOSE PLANS WITHIN A LEVEL.— 
Each employee of a qualified employer that elects a level 
of coverage under subparagraph (A) may choose to enroll 
in a qualified health plan that offers coverage at that 
level. 
(b) PAYMENT
OF PREMIUMS
BY QUALIFIED INDIVIDUALS.—A 
qualified individual enrolled in any qualified health plan may pay 
any applicable premium owed by such individual to the health 
insurance issuer issuing such qualified health plan. 
(c) SINGLE RISK POOL.— 
(1) INDIVIDUAL MARKET.—A health insurance issuer shall 
consider all enrollees in all health plans (other than grand-
fathered health plans) offered by such issuer in the individual 
market, including those enrollees who do not enroll in such 
plans through the Exchange, to be members of a single risk 
pool. 
(2) SMALL GROUP MARKET.—A health insurance issuer shall 
consider all enrollees in all health plans (other than grand-
fathered health plans) offered by such issuer in the small 
group market, including those enrollees who do not enroll in 
such plans through the Exchange, to be members of a single 
risk pool. 
(3) MERGER OF MARKETS.—A State may require the indi-
vidual and small group insurance markets within a State to 
be merged if the State determines appropriate. 
(4) STATE
LAW.—A State law requiring grandfathered 
health plans to be included in a pool described in paragraph 
(1) or (2) shall not apply. 
(d) EMPOWERING CONSUMER CHOICE.— 
(1) 
CONTINUED
OPERATION
OF
MARKET
OUTSIDE 
EXCHANGES.—Nothing in this title shall be construed to pro-
hibit— 
(A) a health insurance issuer from offering outside 
of an Exchange a health plan to a qualified individual 
or qualified employer; and 
(B) a qualified individual from enrolling in, or a quali-
fied employer from selecting for its employees, a health 
plan offered outside of an Exchange. 
(2) CONTINUED
OPERATION
OF
STATE
BENEFIT
REQUIRE-
MENTS.—Nothing in this title shall be construed to terminate, 
abridge, or limit the operation of any requirement under State 
law with respect to any policy or plan that is offered outside 
of an Exchange to offer benefits. 
(3) VOLUNTARY NATURE OF AN EXCHANGE.— 
(A) CHOICE TO ENROLL OR NOT TO ENROLL.—Nothing 
in this title shall be construed to restrict the choice of
H. R. 3590—65 
a qualified individual to enroll or not to enroll in a qualified 
health plan or to participate in an Exchange. 
(B) PROHIBITION AGAINST COMPELLED ENROLLMENT.— 
Nothing in this title shall be construed to compel an indi-
vidual to enroll in a qualified health plan or to participate 
in an Exchange. 
(C) INDIVIDUALS ALLOWED TO ENROLL IN ANY PLAN.— 
A qualified individual may enroll in any qualified health 
plan, except that in the case of a catastrophic plan 
described in section 1302(e), a qualified individual may 
enroll in the plan only if the individual is eligible to enroll 
in the plan under section 1302(e)(2). 
(D) MEMBERS OF CONGRESS IN THE EXCHANGE.— 
(i) REQUIREMENT.—Notwithstanding any other 
provision of law, after the effective date of this subtitle, 
the only health plans that the Federal Government 
may make available to Members of Congress and 
congressional staff with respect to their service as a 
Member of Congress or congressional staff shall be 
health plans that are— 
(I) created under this Act (or an amendment 
made by this Act); or 
(II) offered through an Exchange established 
under this Act (or an amendment made by this 
Act). 
(ii) DEFINITIONS.—In this section: 
(I) MEMBER OF CONGRESS.—The term ‘‘Member 
of Congress’’ means any member of the House 
of Representatives or the Senate. 
(II) 
CONGRESSIONAL
STAFF.—The 
term 
‘‘congressional staff’’ means all full-time and part- 
time employees employed by the official office of 
a Member of Congress, whether in Washington, 
DC or outside of Washington, DC. 
(4) NO PENALTY FOR TRANSFERRING TO MINIMUM ESSENTIAL 
COVERAGE OUTSIDE EXCHANGE.—An Exchange, or a qualified 
health plan offered through an Exchange, shall not impose 
any penalty or other fee on an individual who cancels enroll-
ment in a plan because the individual becomes eligible for 
minimum essential coverage (as defined in section 5000A(f) 
of the Internal Revenue Code of 1986 without regard to para-
graph (1)(C) or (D) thereof) or such coverage becomes affordable 
(within the meaning of section 36B(c)(2)(C) of such Code). 
(e) ENROLLMENT THROUGH AGENTS
OR BROKERS.—The Sec-
retary shall establish procedures under which a State may allow 
agents or brokers— 
(1) to enroll individuals in any qualified health plans in 
the individual or small group market as soon as the plan 
is offered through an Exchange in the State; and 
(2) to assist individuals in applying for premium tax credits 
and cost-sharing reductions for plans sold through an Exchange. 
Such procedures may include the establishment of rate schedules 
for broker commissions paid by health benefits plans offered through 
an exchange. 
(f) QUALIFIED INDIVIDUALS AND EMPLOYERS; ACCESS LIMITED 
TO CITIZENS AND LAWFUL RESIDENTS.— 
(1) QUALIFIED INDIVIDUALS.—In this title:
H. R. 3590—66 
(A) IN
GENERAL.—The term ‘‘qualified individual’’ 
means, with respect to an Exchange, an individual who— 
(i) is seeking to enroll in a qualified health plan 
in the individual market offered through the Exchange; 
and 
(ii) resides in the State that established the 
Exchange (except with respect to territorial agreements 
under section 1312(f)). 
(B) INCARCERATED INDIVIDUALS EXCLUDED.—An indi-
vidual shall not be treated as a qualified individual if, 
at the time of enrollment, the individual is incarcerated, 
other than incarceration pending the disposition of charges. 
(2) QUALIFIED EMPLOYER.—In this title: 
(A) IN GENERAL.—The term ‘‘qualified employer’’ means 
a small employer that elects to make all full-time employees 
of such employer eligible for 1 or more qualified health 
plans offered in the small group market through an 
Exchange that offers qualified health plans. 
(B) EXTENSION TO LARGE GROUPS.— 
(i) IN GENERAL.—Beginning in 2017, each State 
may allow issuers of health insurance coverage in the 
large group market in the State to offer qualified health 
plans in such market through an Exchange. Nothing 
in this subparagraph shall be construed as requiring 
the issuer to offer such plans through an Exchange. 
(ii) LARGE EMPLOYERS ELIGIBLE.—If a State under 
clause (i) allows issuers to offer qualified health plans 
in the large group market through an Exchange, the 
term ‘‘qualified employer’’ shall include a large 
employer that elects to make all full-time employees 
of such employer eligible for 1 or more qualified health 
plans offered in the large group market through the 
Exchange. 
(3) ACCESS
LIMITED
TO
LAWFUL
RESIDENTS.—If an indi-
vidual is not, or is not reasonably expected to be for the entire 
period for which enrollment is sought, a citizen or national 
of the United States or an alien lawfully present in the United 
States, the individual shall not be treated as a qualified indi-
vidual and may not be covered under a qualified health plan 
in the individual market that is offered through an Exchange. 
SEC. 1313. FINANCIAL INTEGRITY. 
(a) ACCOUNTING FOR EXPENDITURES.— 
(1) IN
GENERAL.—An Exchange shall keep an accurate 
accounting of all activities, receipts, and expenditures and shall 
annually submit to the Secretary a report concerning such 
accountings. 
(2) INVESTIGATIONS.—The Secretary, in coordination with 
the Inspector General of the Department of Health and Human 
Services, may investigate the affairs of an Exchange, may 
examine the properties and records of an Exchange, and may 
require periodic reports in relation to activities undertaken 
by an Exchange. An Exchange shall fully cooperate in any 
investigation conducted under this paragraph. 
(3) AUDITS.—An Exchange shall be subject to annual audits 
by the Secretary.
H. R. 3590—67 
(4) PATTERN OF ABUSE.—If the Secretary determines that 
an Exchange or a State has engaged in serious misconduct 
with respect to compliance with the requirements of, or carrying 
out of activities required under, this title, the Secretary may 
rescind from payments otherwise due to such State involved 
under this or any other Act administered by the Secretary 
an amount not to exceed 1 percent of such payments per year 
until corrective actions are taken by the State that are deter-
mined to be adequate by the Secretary. 
(5) PROTECTIONS AGAINST FRAUD AND ABUSE.—With respect 
to activities carried out under this title, the Secretary shall 
provide for the efficient and non-discriminatory administration 
of Exchange activities and implement any measure or procedure 
that— 
(A) the Secretary determines is appropriate to reduce 
fraud and abuse in the administration of this title; and 
(B) the Secretary has authority to implement under 
this title or any other Act. 
(6) APPLICATION OF THE FALSE CLAIMS ACT.— 
(A) IN GENERAL.—Payments made by, through, or in 
connection with an Exchange are subject to the False 
Claims Act (31 U.S.C. 3729 et seq.) if those payments 
include any Federal funds. Compliance with the require-
ments of this Act concerning eligibility for a health insur-
ance issuer to participate in the Exchange shall be a mate-
rial condition of an issuer’s entitlement to receive pay-
ments, including payments of premium tax credits and 
cost-sharing reductions, through the Exchange. 
(B) DAMAGES.—Notwithstanding paragraph (1) of sec-
tion 3729(a) of title 31, United States Code, and subject 
to paragraph (2) of such section, the civil penalty assessed 
under the False Claims Act on any person found liable 
under such Act as described in subparagraph (A) shall 
be increased by not less than 3 times and not more than 
6 times the amount of damages which the Government 
sustains because of the act of that person. 
(b) GAO OVERSIGHT.—Not later than 5 years after the first 
date on which Exchanges are required to be operational under 
this title, the Comptroller General shall conduct an ongoing study 
of Exchange activities and the enrollees in qualified health plans 
offered through Exchanges. Such study shall review— 
(1) the operations and administration of Exchanges, 
including surveys and reports of qualified health plans offered 
through Exchanges and on the experience of such plans 
(including data on enrollees in Exchanges and individuals pur-
chasing health insurance coverage outside of Exchanges), the 
expenses of Exchanges, claims statistics relating to qualified 
health plans, complaints data relating to such plans, and the 
manner in which Exchanges meet their goals; 
(2) any significant observations regarding the utilization 
and adoption of Exchanges; 
(3) where appropriate, recommendations for improvements 
in the operations or policies of Exchanges; and 
(4) how many physicians, by area and specialty, are not 
taking or accepting new patients enrolled in Federal Govern-
ment health care programs, and the adequacy of provider net-
works of Federal Government health care programs.
H. R. 3590—68 
PART III—STATE FLEXIBILITY RELATING TO 
EXCHANGES 
SEC. 1321. STATE FLEXIBILITY IN OPERATION AND ENFORCEMENT OF 
EXCHANGES AND RELATED REQUIREMENTS. 
(a) ESTABLISHMENT OF STANDARDS.— 
(1) IN GENERAL.—The Secretary shall, as soon as prac-
ticable after the date of enactment of this Act, issue regulations 
setting standards for meeting the requirements under this title, 
and the amendments made by this title, with respect to— 
(A) the establishment and operation of Exchanges 
(including SHOP Exchanges); 
(B) the offering of qualified health plans through such 
Exchanges; 
(C) the establishment of the reinsurance and risk 
adjustment programs under part V; and 
(D) such other requirements as the Secretary deter-
mines appropriate. 
The preceding sentence shall not apply to standards for require-
ments under subtitles A and C (and the amendments made 
by such subtitles) for which the Secretary issues regulations 
under the Public Health Service Act. 
(2) CONSULTATION.—In issuing the regulations under para-
graph (1), the Secretary shall consult with the National Associa-
tion of Insurance Commissioners and its members and with 
health insurance issuers, consumer organizations, and such 
other individuals as the Secretary selects in a manner designed 
to ensure balanced representation among interested parties. 
(b) STATE ACTION.—Each State that elects, at such time and 
in such manner as the Secretary may prescribe, to apply the require-
ments described in subsection (a) shall, not later than January 
1, 2014, adopt and have in effect— 
(1) the Federal standards established under subsection (a); 
or 
(2) a State law or regulation that the Secretary determines 
implements the standards within the State. 
(c) FAILURE TO ESTABLISH EXCHANGE OR IMPLEMENT REQUIRE-
MENTS.— 
(1) IN GENERAL.—If— 
(A) a State is not an electing State under subsection 
(b); or 
(B) the Secretary determines, on or before January 
1, 2013, that an electing State— 
(i) will not have any required Exchange operational 
by January 1, 2014; or 
(ii) has not taken the actions the Secretary deter-
mines necessary to implement— 
(I) the other requirements set forth in the 
standards under subsection (a); or 
(II) the requirements set forth in subtitles A 
and C and the amendments made by such sub-
titles; 
the Secretary shall (directly or through agreement with a not- 
for-profit entity) establish and operate such Exchange within 
the State and the Secretary shall take such actions as are 
necessary to implement such other requirements.