To amend the Employee Retirement Income Security Act of 1974 and the Internal Revenue Code of 1986 to require that group health plans provide coverage for pervasive developmental disorders such as autism.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fairness in Autism Treatment Act of 
2007''.

SEC. 2. AMENDMENTS TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 
              1974.

    (a) In General.--Subpart B of part 7 of subtitle B of title I of 
the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1185 et 
seq.) is amended by adding at the end the following new section:

``SEC. 714. PARITY FOR PERVASIVE DEVELOPMENTAL DISORDERS.

    ``(a) In General.--A group health plan (and a health insurance 
issuer providing health insurance coverage offered in connection with 
such a plan) that provides both medical and surgical benefits shall 
provide coverage for pervasive developmental disorders, including 
coverage for therapeutic, respite, and rehabilitative care for 
participants or beneficiaries who have not attained 22 years of age.
    ``(b) In-Network and Out-of-Network Standards.--
            ``(1) In general.--In the case of a group health plan (or 
        health insurance coverage offered in connection with such a 
        plan) that provides benefits for pervasive developmental 
        disorders, and that provides both in-network benefits for such 
        disorders and out-of-network benefits for such disorders, the 
        requirements of this section shall apply separately with 
        respect to benefits provided under the plan (or coverage) on an 
        in-network basis and benefits provided under the plan (or 
        coverage) on an out-of-network basis.
            ``(2) Clarification.--Nothing in paragraph (1) shall be 
        construed as requiring that a group health plan (or health 
        insurance coverage offered in connection with such a plan) 
        eliminate an out-of-network provider option from such plan (or 
        coverage) pursuant to the terms of the plan (or coverage).
    ``(c) Other Requirements.--
            ``(1) Annual or lifetime dollar limitations.--A group 
        health plan (or health insurance coverage offered in connection 
        with such a plan) may not impose any annual or lifetime dollar 
        limitation on benefits for pervasive developmental disorders 
        unless such limitation applies to all medical and surgical 
        benefits and benefits for pervasive developmental disorders 
        under the plan (or coverage).
            ``(2) Cost sharing.--A group health plan (or health 
        insurance coverage offered in connection with such a plan) may 
        not impose a deductible, coinsurance, or other cost-sharing 
        with respect to the coverage of pervasive developmental 
        disorders under the plan (or coverage), which is greater than 
        the deductible, coinsurance, or other cost-sharing, as the case 
        may be, imposed with respect to medical and surgical benefits 
        under the plan (or coverage).
            ``(3) Eligibility to enroll or renew.--A group health plan 
        (or a health insurance issuer providing health insurance 
        coverage offered in connection with such a plan) may not deny 
        eligibility, or continued eligibility, to enroll or to renew 
        coverage under the term of the plan (or coverage), solely for 
        the purpose of avoiding the requirements of this section.
    ``(d) Notice Under Group Health Plan.--The imposition of the 
requirements of this section shall be treated as a material 
modification in the terms of the plan described in the last sentence of 
section 102(a), for purposes of assuring notice of such requirements 
under the plan; except that the summary description required to be 
provided under the fourth sentence of section 104(b)(1) with respect to 
such modification shall be provided by not later than 60 days after the 
first day of the first plan year in which such requirements apply.
    ``(e) Exemptions.--
            ``(1) Small employer exemption.--
                    ``(A) In general.--This section shall not apply to 
                any group health plan (and group health insurance 
                coverage offered in connection with a group health 
                plan) for any plan year of a small employer.
                    ``(B) Small employer.--For purposes of subparagraph 
                (A), the term `small employer' means, in connection 
                with a group health plan with respect to a calendar 
                year and a plan year, an employer who employed an 
                average of at least 2 (or 1 in the case of an employer 
                residing in a State that permits small groups to 
                include a single individual) but not more than 50 
                employees on business days during the preceding 
                calendar year.
                    ``(C) Application of certain rules in determination 
                of employer size.--For purposes of this paragraph--
                            ``(i) Application of aggregation rule for 
                        employers.--Rules similar to the rules under 
                        subsections (b), (c), (m), and (o) of section 
                        414 of the Internal Revenue Code of 1986 shall 
                        apply for purposes of treating persons as a 
                        single employer.
                            ``(ii) Employers not in existence in 
                        preceding year.--In the case of an employer 
                        which was not in existence throughout the 
                        preceding calendar year, the determination of 
                        whether such employer is a small 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.
                            ``(iii) Predecessors.--Any reference in 
                        this paragraph to an employer shall include a 
                        reference to any predecessor of such employer.
            ``(2) Increased cost exemption.--This section shall not 
        apply with respect to a group health plan (or group health 
        insurance coverage offered in connection with a group health 
        plan) if the application of this section to such plan (or 
        coverage) results in an increase in the cost under the plan (or 
        coverage) of at least 1 percent.
    ``(f) Pervasive Developmental Disorder Defined.--For purposes of 
this section, the term `pervasive developmental disorder' means any 
developmental disability (as defined in section 102(8) of the 
Developmental Disabilities Assistance and Bill of Rights Act of 2000 
(42 U.S.C. 15002(8))).
    ``(g) Preemption, Relation to State Laws.--
            ``(1) In general.--Nothing in this section shall be 
        construed to preempt any State law in effect with respect to 
        health insurance coverage to the extent the requirements of 
        such law at least meet the requirements of this section.
            ``(2) ERISA.--Nothing in this section shall be construed to 
        affect or modify the provisions of section 514 with respect to 
        group health plans.''.
    (b) Conforming Amendments.--
            (1) Section 731(c) of such Act (29 U.S.C. 1191(c)) is 
        amended by striking ``section 711'' and inserting ``sections 
        711 and 714''.
            (2) Section 732(a) of such Act (29 U.S.C. 1191a(a)) is 
        amended by striking ``section 711'' and inserting ``sections 
        711 and 714''.
    (c) Clerical Amendment.--The table of contents in section 1 of such 
Act is amended by inserting after the item relating to section 713 the 
following new item:

``Sec. 714. Parity for pervasive developmental disorders.''.
    (d) Effective Date.--The amendments made by this section shall 
apply with respect to plan years beginning on or after January 1, 2009.

SEC. 3. AMENDMENTS TO INTERNAL REVENUE CODE OF 1986.

    (a) In General.--Subchapter B of chapter 100 of the Internal 
Revenue Code of 1986 (relating to group health plan requirements) is 
amended by adding at the end the following new section:

``SEC. 9813. PARITY FOR PERVASIVE DEVELOPMENTAL DISORDERS.

    ``(a) In General.--A group health plan that provides both medical 
and surgical benefits shall provide coverage for pervasive 
developmental disorders, including coverage for therapeutic, respite, 
and rehabilitative care for participants or beneficiaries who have not 
attained 22 years of age.
    ``(b) In-Network and Out-of-Network Standards.--
            ``(1) In general.--In the case of a group health plan that 
        provides benefits for pervasive developmental disorders, and 
        that provides both in-network benefits for such disorders and 
        out-of-network benefits for such disorders, the requirements of 
        this section shall apply separately with respect to benefits 
        provided under the plan on an in-network basis and benefits 
        provided under the plan on an out-of-network basis.
            ``(2) Clarification.--Nothing in paragraph (1) shall be 
        construed as requiring that a group health plan eliminate an 
        out-of-network provider option from such plan pursuant to the 
        terms of the plan.
    ``(c) Other Requirements.--
            ``(1) Annual or lifetime dollar limitations.--A group 
        health plan may not impose any annual or lifetime dollar 
        limitation on benefits for pervasive developmental disorders 
        unless such limitation applies to all medical and surgical 
        benefits and benefits for pervasive developmental disorders 
        provided under the plan.
            ``(2) Cost sharing.--A group health plan may not impose a 
        deductible, coinsurance, or other cost-sharing with respect to 
        the coverage of pervasive developmental disorders under the 
        plan, which is greater than the deductible, coinsurance, or 
        other cost-sharing, as the case may be, imposed with respect to 
        medical and surgical benefits under the plan.
            ``(3) Eligibility to enroll or renew.--A group health plan 
        may not deny eligibility, or continued eligibility, to enroll 
        or to renew coverage under the term of the plan, solely for the 
        purpose of avoiding the requirements of this section.
    ``(d) Exemptions.--
            ``(1) Small employer exemption.--
                    ``(A) In general.--This section shall not apply to 
                any group health plan for any plan year of a small 
                employer.
                    ``(B) Small employer.--For purposes of subparagraph 
                (A), the term `small employer' means, with respect to a 
                calendar year and a plan year, an employer who employed 
                an average of at least 2 (or 1 in the case of an 
                employer residing in a State that permits small groups 
                to include a single individual) but not more than 50 
                employees on business days during the preceding 
                calendar year. For purposes of the preceding sentence, 
                all persons treated as a single employer under 
                subsection (b), (c), (m), or (o) of section 414 shall 
                be treated as 1 employer and rules similar to rules of 
                subparagraphs (B) and (C) of section 4980D(d)(2) shall 
                apply.
            ``(2) Increased cost exemption.--This section shall not 
        apply with respect to a group health plan if the application of 
        this section to such plan results in an increase in the cost 
        under the plan of at least 1 percent.
    ``(e) Pervasive Developmental Disorder Defined.--For purposes of 
this section, the term `pervasive developmental disorder' means any 
developmental disability (as defined in section 102(8) of the 
Developmental Disabilities Assistance and Bill of Rights Act of 2000 
(42 U.S.C. 15002(8)).''.
    (b) Conforming Amendments.--The table of sections for subchapter B 
of chapter 100 of such Code is amended by adding at the end the 
following new item:

``Sec. 9813. Parity for pervasive developmental disorders.''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to group health plans for plan years beginning on or 
after January 1, 2009.

Summary: Fairness in Autism Treatment Act of 2007 - Amends the Employee Retirement Income Security Act of 1974 (ERISA) and the Internal Revenue Code to require a group health plan that provides both medical and surgical benefits to also provide coverage for pervasive developmental disorders, including coverage for therapeutic, respite, and rehabilitative care for participants or beneficiaries who have not attained 22 years of age.

Applies the requirements of this Act separately with respect to benefits provided in-network and out-of-network.

Prohibits a group health plan from: (1) imposing any annual or lifetime dollar limitation on benefits for pervasive developmental disorders unless such limitation applies to all medical and surgical benefits as well; (2) imposing a deductible, coinsurance, or other cost-sharing for such disorders that is greater than the cost-sharing imposed for medical and surgical benefits; or (3) denying eligibility, or continued eligibility, to enroll or renew coverage under the term of the plan solely for the purpose of avoiding the requirements of this Act.

Considers the requirements of this Act a material change for the purpose of notice requirements.

Excludes from the requirements of this Act: (1) a group health plan of a small employer; or (2) a group health plan if the application of this Act results in an increase in the cost under the plan of at least 1%.

Provides that this Act shall not be construed to preempt any state law that at least meets the requirements of this Act.