Fair Care Act of 2022
Bill: H.R.8588 | Sponsor: Rep. Westerman, Bruce (R-AR)
Policy area: Health

Summary:
Fair Care Act of 2022  This bill addresses the health care system, including Medicare, Medicaid, the private health insurance market, and the prescription drug approval process. The bill also revises tax provisions related to certain health care costs and establishes requirements for lawsuits involving health care provided, at least in part, through a federal program or with federal funds.

To address the high costs of health care services, prescription drugs, 
   and health insurance coverage in the United States, and for other 
                               purposes.

    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 ``Fair Care Act of 
2022''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
           TITLE I--MODERNIZATION OF HEALTH SAVINGS ACCOUNTS

 Subtitle A--Modernization of Health Savings Accounts and Contributions

Sec. 101. Modernization of health savings accounts.
Sec. 102. Unused premium tax credits may be deposited in health savings 
                            accounts.
Sec. 103. Health Reimbursement Arrangements and Other Account-Based 
                            Group Health Plans.
Sec. 104. Cost-sharing reduction payments as eligible contributions.
Sec. 105. Direct primary care.
           Subtitle B--Assistance to Health Savings Accounts

Sec. 111. One-time application of saver's credit to contributions to 
                            health savings accounts.
Sec. 112. Grants for health savings account assistance and outreach.
Sec. 113. New corporations required to use health savings accounts.
Sec. 114. Federal employee health benefits and health savings accounts.
              TITLE II--IMPROVING PRIVATE HEALTH INSURANCE

   Subtitle A--Maintaining Protections for Patients With Preexisting 
                               Conditions

Sec. 201. Guaranteed availability of coverage; prohibiting 
                            discrimination.
                 Subtitle B--Expanding Coverage Options

Sec. 211. Definition of ``employer'' under ERISA with respect to group 
                            health plans.
Sec. 212. Short-term limited duration insurance.
           Subtitle C--Improving Commercial Health Insurance

Sec. 221. Invisible Guaranteed Coverage Pool Reinsurance Program; tax 
                            on exchange plans.
Sec. 222. Employer health insurance mandate repeal.
Sec. 223. Refundable credits for coverage under a qualified health plan 
                            for individuals offered employer-sponsored 
                            insurance.
Sec. 224. Inclusion in income of certain costs of employer-provided 
                            coverage under health plans.
Sec. 225. Change in permissible age variation in health insurance 
                            premium rates.
Sec. 226. Premium assistance adjustment to reflect age.
Sec. 227. Premium assistance.
Sec. 228. Adding copper plans to Exchanges.
Sec. 229. Copper and bronze plans.
Sec. 230. Waivers for State innovation.
Sec. 231. Enrollment periods.
Sec. 232. State-operated Exchanges flexibility for open enrollment 
                            periods.
Sec. 233. Promoting health plans that cover individuals in more than 
                            one State.
        TITLE III--COMPETITION, TRANSPARENCY AND ACCOUNTABILITY

              Subtitle A--Provider and Insurer Competition

Sec. 301. Hospital consolidation.
Sec. 302. Authority of Federal Trade Commission over certain tax-exempt 
                            organizations.
Sec. 303. Leveling the playing field between payers and providers.
Sec. 304. Banning anticompetitive terms in facility and insurance 
                            contracts that limit access to higher 
                            quality, lower cost care.
Sec. 305. Repealing eligibility of certain ACOs.
Sec. 306. Repeal of health care reform provisions limiting Medicare 
                            exception to the prohibition on certain 
                            physician referrals for hospitals.
Sec. 307. Alternative payment model for certain shoppable procedures.
                     Subtitle B--Price Transparency

Sec. 321. Price transparency requirements.
Sec. 322. Ensuring enrollee access to cost-sharing information.
Sec. 323. Access of individuals to protected health information.
Sec. 324. Timely bills for patients.
Sec. 325. Advisory group on reducing burden of hospital administrative 
                            requirements.
Sec. 326. Data reporting to improve the transparency regarding how 340B 
                            hospital covered entities provide care for 
                            patients.
Sec. 327. Requiring 340B drug discount program reports by DSH hospital 
                            covered entities on low-income utilization 
                            rate of outpatient hospital services.
Sec. 328. Employer benefits reports.
Sec. 329. Government Accountability Office study on profit- and 
                            revenue-sharing in health care.
        Subtitle C--Prescription Drug Competition and Innovation

Sec. 341. Expedited development and priority review for generic complex 
                            drug products.
Sec. 342. Preventing blocking of generic drugs.
Sec. 343. Ensuring timely access to generics.
Sec. 344. Preemption of State barriers to the substitution of 
                            biosimilar products.
Sec. 345. Increasing pharmaceutical options to treat an unmet medical 
                            need.
Sec. 346. Provisional approval of new human drugs.
Sec. 347. Consolidating exclusivity periods for drugs treating rare 
                            diseases and conditions.
Sec. 348. Exclusivity period for brand name biological products.
Sec. 349. Regulation of manufacturer-sponsored copay contributions.
Sec. 350. Antitrust exemption for private health insurer issuers to 
                            negotiate wholesale acquisition prices of 
                            prescription drugs purchased from drug 
                            manufacturers.
Sec. 351. Biological product innovation.
Sec. 352. Prompt approval of drugs related to safety information.
Sec. 353. Congressional review of the Food and Drug Administration 
                            rulemaking.
Sec. 354. Government Accountability Office study of rules.
Subtitle D--Prescription Drug and Pharmacy Benefit Manager Transparency

Sec. 361. Patent disclosure requirements.
Sec. 362. Requirements with respect to prescription drug benefits.
Sec. 363. PBM transparency and elimination of DIR fees.
Sec. 364. Health plan oversight of pharmacy benefit manager services.
Sec. 365. Study by Comptroller General of United States.
      Subtitle E--Medicare and Medicaid Prescription Drug Reforms

Sec. 371. Medicare part D modernization redesign.
Sec. 372. Maximum monthly cap on cost-sharing payments under 
                            prescription drug plans and MA-PD plans.
Sec. 373. Medicare part B rebate by manufacturers for drugs or 
                            biologicals with prices increasing faster 
                            than inflation.
Sec. 374. Market based part B pricing index.
Sec. 375. Innovation model testing of Medicare drug payments.
Sec. 376. Modification of maximum rebate amount under Medicaid drug 
                            rebate program.
                 Subtitle F--Medical Malpractice Reform

Sec. 381. Definitions.
Sec. 382. Encouraging speedy resolution of claims.
Sec. 383. Compensating patient injury.
Sec. 384. Maximizing patient recovery.
Sec. 385. Authorization of payment of future damages to claimants in 
                            health care lawsuits.
Sec. 386. Product liability for health care providers.
Sec. 387. Effect on other laws.
Sec. 388. Limitation on expert witness testimony.
Sec. 389. Expert witness qualifications.
Sec. 390. Communications following unanticipated outcome.
Sec. 391. Affidavit of merit.
Sec. 392. Notice of intent to commence lawsuit.
Sec. 393. Limitation on liability for volunteer health care 
                            professionals.
Sec. 394. Rules of construction.
Sec. 395. Effective date.
                TITLE IV--MEDICARE AND MEDICAID REFORMS

                      Subtitle A--Medicaid Reforms

Sec. 401. Medicaid payment reform.
Sec. 402. Income limitations for refundable credits for coverage under 
                            a qualified health plan.
Sec. 403. Medicaid eligibility determinations.
Sec. 404. Lowering safe harbor threshold with respect to State taxes on 
                            health care providers.
Sec. 405. Providing for State approval and implementation of specified 
                            waivers under the Medicaid program.
Sec. 406. Deduction for qualified charity care.
                      Subtitle B--Medicare Reforms

Sec. 411. Off-campus provider-based department Medicare site neutral 
                            payment.
Sec. 412. Eliminating FEHBP eligibility for annuitants.
Sec. 413. Elimination of Medicare eligibility for certain individuals.
Sec. 414. Medicare part D tax deduction.
Sec. 415. Repeal of net investment income tax.
Sec. 416. Medicare coverage of bad debt.
              Subtitle C--Medicare Choice and Competition

Sec. 421. Competitive bidding and premiums under unified Medicare.
Sec. 422. New unified eligibility and enrollment rules.
Sec. 423. New benefit structure under unified Medicare.
Sec. 424. Late enrollment penalty not to apply for months of any health 
                            coverage.
Sec. 425. Medigap reform.
Sec. 426. ACO revision.
Sec. 427. Primary care options.
Sec. 428. General provisions; effective date.
           Subtitle D--Telehealth Improvements and Expansion

Sec. 431. Expansion of coverage of telehealth services.
Sec. 432. Expanding the use of telehealth through the waiver of certain 
                            requirements.
Sec. 433. Expanding the use of telehealth for mental health services.
Sec. 434. Use of telehealth in emergency medical care.
Sec. 435. Improvements to the process for adding telehealth services.
Sec. 436. Rural health clinics and Federally qualified health centers.
Sec. 437. Native American health facilities.
Sec. 438. Waiver of telehealth restrictions during national 
                            emergencies.
Sec. 439. Use of telehealth in recertification for hospice care.
Sec. 440. Clarification for fraud and abuse laws regarding technologies 
                            provided to beneficiaries.
Sec. 441. Study and report on increasing access to telehealth services 
                            in the home.
Sec. 442. Analysis of telehealth waivers in alternative payment models.
Sec. 443. Model to allow additional health professionals to furnish 
                            telehealth services.
Sec. 444. Testing of models to examine the use of telehealth under the 
                            Medicare program.

           TITLE I--MODERNIZATION OF HEALTH SAVINGS ACCOUNTS

 Subtitle A--Modernization of Health Savings Accounts and Contributions

SEC. 101. MODERNIZATION OF HEALTH SAVINGS ACCOUNTS.

    (a) In General.--Section 223 of the Internal Revenue Code of 1986 
is amended to read as follows:

``SEC. 223. HEALTH SAVINGS ACCOUNTS.

    ``(a) Deduction Allowed.--In the case of an individual who is an 
eligible individual for any month during the taxable year, there shall 
be allowed as a deduction for the taxable year an amount equal to the 
aggregate amount paid in cash during such taxable year by or on behalf 
of such individual to a health savings account of such individual.
    ``(b) Limitations.--
            ``(1) In general.--The amount allowable as a deduction 
        under subsection (a) with respect to any month is \1/12\ of the 
        dollar amount in effect under subsection (d)(2)(A) for the 
        taxable year which included such month.
            ``(2) Denial of deduction to dependents.--No deduction 
        shall be allowed under this section to any individual with 
        respect to whom a deduction under section 151 is allowable to 
        another taxpayer for a taxable year beginning in the calendar 
        year in which such individual's taxable year begins.
            ``(3) Increase in limit for individuals becoming eligible 
        individuals after the beginning of the year.--
                    ``(A) In general.--For purposes of computing the 
                limitation under paragraph (1) for any taxable year, an 
                individual who is an eligible individual during the 
                last month of such taxable year shall be treated--
                            ``(i) as having been an eligible individual 
                        during each of the months in such taxable year, 
                        and
                            ``(ii) as having been enrolled, during each 
                        of the months such individual is treated as an 
                        eligible individual solely by reason of clause 
                        (i), in the same qualified plan in which the 
                        individual was enrolled for the last month of 
                        such taxable year.
                    ``(B) Failure to maintain qualified plan 
                coverage.--
                            ``(i) In general.--If, at any time during 
                        the testing period, the individual is not an 
                        eligible individual, then--
                                    ``(I) gross income of the 
                                individual for the taxable year in 
                                which occurs the first month in the 
                                testing period for which such 
                                individual is not an eligible 
                                individual is increased by the 
                                aggregate amount of all contributions 
                                to the health savings account of the 
                                individual which could not have been 
                                made but for subparagraph (A), and
                                    ``(II) the tax imposed by this 
                                chapter for any taxable year on the 
                                individual shall be increased by 10 
                                percent of the amount of such increase.
                            ``(ii) Exception for disability or death.--
                        Subclauses (I) and (II) of clause (i) shall not 
                        apply if the individual ceased to be an 
                        eligible individual by reason of the death of 
                        the individual or the individual becoming 
                        disabled (within the meaning of section 
                        72(m)(7)).
                            ``(iii) Testing period.--The term `testing 
                        period' means the period beginning with the 
                        last month of the taxable year referred to in 
                        subparagraph (A) and ending on the last day of 
                        the 12th month following such month.
    ``(c) Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Eligible individual.--The term `eligible individual' 
        means, with respect to any month, any individual if such 
        individual is covered under a qualified plan as of the 1st day 
        of such month
            ``(2) Qualified plan.--
                    ``(A) In general.--The term `qualified health plan' 
                means any health plan, including employer plans, 
                individual plans, short term plans, Medicare, Medicaid, 
                VA health care, TRICARE, Indian health service, health 
                care sharing ministries, and association health plans.
                    ``(B) Exclusion of certain plans.--Such term does 
                not include a health plan if substantially all of its 
                coverage is--
                            ``(i) coverage for any benefit provided by 
                        permitted insurance, or
                            ``(ii) coverage (whether through insurance 
                        or otherwise) for accidents, disability, dental 
                        care, vision care, or long-term care.
            ``(3) Permitted insurance.--The term `permitted insurance' 
        means--
                    ``(A) insurance if substantially all of the 
                coverage provided under such insurance relates to--
                            ``(i) liabilities incurred under workers' 
                        compensation laws,
                            ``(ii) tort liabilities,
                            ``(iii) liabilities relating to ownership 
                        or use of property, or
                            ``(iv) such other similar liabilities as 
                        the Secretary may specify by regulations,
                    ``(B) insurance for a specified disease or illness, 
                and
                    ``(C) insurance paying a fixed amount per day (or 
                other period) of hospitalization.
            ``(4) Family coverage.--The term `family coverage' means 
        any coverage other than self-only coverage.
    ``(d) Health Savings Account.--For purposes of this section--
            ``(1) In general.--The term `health savings account' means 
        a trust created or organized in the United States as a health 
        savings account exclusively for the purpose of paying the 
        qualified medical expenses of the account beneficiary, but only 
        if the written governing instrument creating the trust meets 
        the following requirements:
                    ``(A) Except in the case of a rollover contribution 
                described in subsection (f)(5) or section 220(f)(5), no 
                contribution will be accepted--
                            ``(i) unless it is in cash, or
                            ``(ii) to the extent such contribution, 
                        when added to previous contributions to the 
                        trust for the calendar year, exceeds the 
                        limitation amount specified in paragraph 
                        (2)(A), or
                            ``(iii) to the extent such contribution, 
                        when added to the balance of the account, 
                        exceeds the limitation amount specified in 
                        paragraph (2)(B).
                    ``(B) The trustee is a bank (as defined in section 
                408(n)), an insurance company (as defined in section 
                816), or another person who demonstrates to the 
                satisfaction of the Secretary that the manner in which 
                such person will administer the trust will be 
                consistent with the requirements of this section.
                    ``(C) No part of the trust assets will be invested 
                in life insurance contracts.
                    ``(D) The assets of the trust will not be 
                commingled with other property except in a common trust 
                fund or common investment fund.
                    ``(E) The interest of an individual in the balance 
                in his account is nonforfeitable.
            ``(2) Limitations.--
                    ``(A) Annual limitation.--
                            ``(i) In general.--The limitation amount 
                        specified in this subparagraph is--
                                    ``(I) $5,000 in the case of a 
                                qualified health plan with an actuarial 
                                value of less than 40 percent,
                                    ``(II) $4,300 in the case of a 
                                qualified health plan with an actuarial 
                                value that is 40 percent or more and 
                                less than 75 percent, and
                                    ``(III) $3,600 in the case of a 
                                qualified health plan with an actuarial 
                                value that is 75 percent or more.
                            ``(ii) Actuarial value of qualified health 
                        plan.--For purposes of clause (i), the 
                        actuarial value of a qualified health plan is 
                        the percentage of the total average costs of 
                        covered benefits under the health plan.
                    ``(B) Account accumulation limitation.--The 
                limitation amount specified in this paragraph is 
                $50,000.
                    ``(C) Indexing.--
                            ``(i) In general.--In the case of any 
                        taxable year beginning in a calendar year after 
                        2023, each dollar amount contained in 
                        subparagraphs (A)(i) and (B) shall be increased 
                        by the medical care cost adjustment of such 
                        amount for such calendar year.
                            ``(ii) Medical care cost adjustment.--For 
                        purposes of clause (i), the medical care cost 
                        adjustment for any calendar year is the 
                        percentage (if any) by which--
                                    ``(I) the medical care component of 
                                the C-CPI-U (as defined in section 
                                1(f)(6)) for August of the preceding 
                                calendar year, exceeds
                                    ``(II) such component of the C-CPI-
                                U (as so defined) for August of 2022.
                            ``(iii) Rounding.--
                                    ``(I) Annual limitation.--If any 
                                increase in a dollar amount contained 
                                in subparagraph (A)(i) determined under 
                                clause (i) is not a multiple of $100, 
                                such increase shall be rounded to the 
                                nearest multiple of $100.
                                    ``(II) Account limitation.--If any 
                                increase in the dollar amount contained 
                                in subparagraph (B) determined under 
                                clause (i) is not a multiple of $1,000, 
                                such increase shall be rounded to the 
                                nearest multiple of $1,000.
                    ``(D) Coordination with other contributions.--The 
                limitation which would (but for this paragraph) apply 
                under subparagraphs (A) and (B) to an individual for 
                any taxable year shall be reduced (but not below zero) 
                by the sum of--
                            ``(i) the aggregate amount contributed to 
                        health savings accounts of such individual 
                        which is excludable from the taxpayer's gross 
                        income for such taxable year under section 
                        106(d) (and such amount shall not be allowed as 
                        a deduction under subsection (a)), and
                            ``(ii) the aggregate amount contributed to 
                        health savings accounts of such individual for 
                        such taxable year under section 408(d)(9) (and 
                        such amount shall not be allowed as a deduction 
                        under subsection (a)).
            ``(3) Qualified medical expenses.--
                    ``(A) In general.--The term `qualified medical 
                expenses' means, with respect to an account 
                beneficiary, amounts paid by such beneficiary for 
                medical care (as defined in section 213(d)) for such 
                individual, the spouse of such individual, and any 
                dependent (as defined in section 152, determined 
                without regard to subsections (b)(1), (b)(2), and 
                (d)(1)(B) thereof) of such individual, but only to the 
                extent such amounts are not compensated for by 
                insurance or otherwise. For purposes of this 
                subparagraph, amounts paid for menstrual care products 
                shall be treated as paid for medical care.
                    ``(B) Health insurance may not be purchased from 
                account.--
                            ``(i) In general.--Subparagraph (A) shall 
                        not apply to any payment for insurance.
                            ``(ii) Exceptions.--Clause (i) shall not 
                        apply to any expense for coverage under--
                                    ``(I) a health plan during any 
                                period of continuation coverage 
                                required under any Federal law,
                                    ``(II) a qualified long-term care 
                                insurance contract (as defined in 
                                section 7702B(b)),
                                    ``(III) a health plan during a 
                                period in which the individual is 
                                receiving unemployment compensation 
                                under any Federal or State law, or
                                    ``(IV) in the case of an account 
                                beneficiary who has attained the age 
                                specified in section 1811 of the Social 
                                Security Act, any health insurance 
                                other than a medicare supplemental 
                                policy (as defined in section 1882 of 
                                the Social Security Act).
                            ``(iii) Exception for integrated health 
                        plans.--Clause (i) shall not apply to any 
                        expense for coverage under an integration 
                        eligible health plan which is integrated with 
                        the health savings account within the meaning 
                        of section 106(d).
                            ``(iv) Exception for direct primary care 
                        service arrangements.--
                                    ``(I) In general.--A direct primary 
                                care service arrangement shall not be 
                                treated as insurance for purposes of 
                                clause (i).
                                    ``(II) Direct primary care service 
                                arrangement defined.--For purposes of 
                                this clause, the term `direct primary 
                                care service arrangement' means an 
                                arrangement under which an individual 
                                is provided medical care (as defined in 
                                section 213(d)(1), determined without 
                                regard to subparagraph (E) thereof) 
                                consisting solely of primary care 
                                services provided by primary care 
                                practitioners (as defined in section 
                                1833(x)(2)(A) of the Social Security 
                                Act, determined without regard to 
                                clause (ii) thereof), if the sole 
                                compensation for such care is a fixed 
                                periodic fee.
                    ``(C) Menstrual care product.--For purposes of this 
                paragraph, the term `menstrual care product' means a 
                tampon, pad, liner, cup, sponge, or similar product 
                used by individuals with respect to menstruation or 
                other genital-tract secretions.
            ``(4) Account beneficiary.--The term `account beneficiary' 
        means the individual on whose behalf the health savings account 
        was established.
            ``(5) Certain rules to apply.--Rules similar to the 
        following rules shall apply for purposes of this section:
                    ``(A) Section 219(d)(2) (relating to no deduction 
                for rollovers).
                    ``(B) Section 219(f)(3) (relating to time when 
                contributions deemed made).
                    ``(C) Except as provided in section 106(d), section 
                219(f)(5) (relating to employer payments).
                    ``(D) Section 408(g) (relating to community 
                property laws).
                    ``(E) Section 408(h) (relating to custodial 
                accounts).
    ``(e) Tax Treatment of Accounts.--
            ``(1) In general.--A health savings account is exempt from 
        taxation under this subtitle unless such account has ceased to 
        be a health savings account. Notwithstanding the preceding 
        sentence, any such account is subject to the taxes imposed by 
        section 511 (relating to imposition of tax on unrelated 
        business income of charitable, etc. organizations).
            ``(2) Account terminations.--Rules similar to the rules of 
        paragraphs (2) and (4) of section 408(e) shall apply to health 
        savings accounts, and any amount treated as distributed under 
        such rules shall be treated as not used to pay qualified 
        medical expenses.
    ``(f) Tax Treatment of Distributions.--
            ``(1) Amounts used for qualified medical expenses.--Any 
        amount paid or distributed out of a health savings account 
        which is used exclusively to pay qualified medical expenses of 
        any account beneficiary shall not be includible in gross 
        income.
            ``(2) Inclusion of amounts not used for qualified medical 
        expenses.--Any amount paid or distributed out of a health 
        savings account which is not used exclusively to pay the 
        qualified medical expenses of the account beneficiary shall be 
        included in the gross income of such beneficiary.
            ``(3) Excess contributions returned before due date of 
        return.--
                    ``(A) In general.--If any excess contribution is 
                contributed for a taxable year to any health savings 
                account of an individual, paragraph (2) shall not apply 
                to distributions from the health savings accounts of 
                such individual (to the extent such distributions do 
                not exceed the aggregate excess contributions to all 
                such accounts of such individual for such year) if--
                            ``(i) such distribution is received by the 
                        individual on or before the last day prescribed 
                        by law (including extensions of time) for 
                        filing such individual's return for such 
                        taxable year, and
                            ``(ii) such distribution is accompanied by 
                        the amount of net income attributable to such 
                        excess contribution.
                Any net income described in clause (ii) shall be 
                included in the gross income of the individual for the 
                taxable year in which it is received.
                    ``(B) Excess contribution.--For purposes of 
                subparagraph (A), the term `excess contribution' means 
                any contribution (other than a rollover contribution 
                described in paragraph (5) or section 220(f)(5)) which 
                is neither excludable from gross income under section 
                106(d) nor deductible under this section.
            ``(4) Additional tax on distributions not used for 
        qualified medical expenses.--
                    ``(A) In general.--The tax imposed by this chapter 
                on the account beneficiary for any taxable year in 
                which there is a payment or distribution from a health 
                savings account of such beneficiary which is includible 
                in gross income under paragraph (2) shall be increased 
                by 20 percent of the amount which is so includible.
                    ``(B) Exception for disability or death.--
                Subparagraph (A) shall not apply if the payment or 
                distribution is made after the account beneficiary 
                becomes disabled within the meaning of section 72(m)(7) 
                or dies.
                    ``(C) Exception for distributions after medicare 
                eligibility.--Subparagraph (A) shall not apply to any 
                payment or distribution after the date on which the 
                account beneficiary attains the age specified in 
                section 1811 of the Social Security Act.
            ``(5) Rollover contribution.--An amount is described in 
        this paragraph as a rollover contribution if it meets the 
        requirements of subparagraphs (A) and (B).
                    ``(A) In general.--Paragraph (2) shall not apply to 
                any amount paid or distributed from a health savings 
                account to the account beneficiary to the extent the 
                amount received is paid into a health savings account 
                for the benefit of such beneficiary not later than the 
                60th day after the day on which the beneficiary 
                receives the payment or distribution.
                    ``(B) Limitation.--This paragraph shall not apply 
                to any amount described in subparagraph (A) received by 
                an individual from a health savings account if, at any 
                time during the 1-year period ending on the day of such 
                receipt, such individual received any other amount 
                described in subparagraph (A) from a health savings 
                account which was not includible in the individual's 
                gross income because of the application of this 
                paragraph.
                    ``(C) Rollover from fsa, archer msa, and hra.--An 
                amount is described in this subparagraph for a calendar 
                year as a rollover contribution if the amount is the 
                remaining balance in a health flexible spending 
                account, Archer MSA, or health reimbursement 
                arrangement that is contributed to the health savings 
                account for a taxable year ending on or before one year 
                after the date of the enactment of this subparagraph.
            ``(6) Coordination with medical expense deduction.--For 
        purposes of determining the amount of the deduction under 
        section 213, any payment or distribution out of a health 
        savings account for qualified medical expenses shall not be 
        treated as an expense paid for medical care.
            ``(7) Transfer of account incident to divorce.--The 
        transfer of an individual's interest in a health savings 
        account to an individual's spouse or former spouse under a 
        divorce or separation instrument described in clause (i) of 
        section 121(d)(3)(C) shall not be considered a taxable transfer 
        made by such individual notwithstanding any other provision of 
        this subtitle, and such interest shall, after such transfer, be 
        treated as a health savings account with respect to which such 
        spouse is the account beneficiary.
            ``(8) Treatment after death of account beneficiary.--
                    ``(A) Treatment if designated beneficiary is 
                spouse.--If the account beneficiary's surviving spouse 
                acquires such beneficiary's interest in a health 
                savings account by reason of being the designated 
                beneficiary of such account at the death of the account 
                beneficiary, such health savings account shall be 
                treated as if the spouse were the account beneficiary.
                    ``(B) Other cases.--
                            ``(i) In general.--If, by reason of the 
                        death of the account beneficiary, any person 
                        acquires the account beneficiary's interest in 
                        a health savings account in a case to which 
                        subparagraph (A) does not apply--
                                    ``(I) such account shall cease to 
                                be a health savings account as of the 
                                date of death, and
                                    ``(II) an amount equal to the fair 
                                market value of the assets in such 
                                account on such date shall be 
                                includible if such person is not the 
                                estate of such beneficiary, in such 
                                person's gross income for the taxable 
                                year which includes such date, or if 
                                such person is the estate of such 
                                beneficiary, in such beneficiary's 
                                gross income for the last taxable year 
                                of such beneficiary.
                            ``(ii) Special rules.--
                                    ``(I) Reduction of inclusion for 
                                predeath expenses.--The amount 
                                includible in gross income under clause 
                                (i) by any person (other than the 
                                estate) shall be reduced by the amount 
                                of qualified medical expenses which 
                                were incurred by the decedent before 
                                the date of the decedent's death and 
                                paid by such person within 1 year after 
                                such date.
                                    ``(II) Deduction for estate 
                                taxes.--An appropriate deduction shall 
                                be allowed under section 691(c) to any 
                                person (other than the decedent or the 
                                decedent's spouse) with respect to 
                                amounts included in gross income under 
                                clause (i) by such person.
    ``(g) Cost-of-Living Adjustment.--
            ``(1) In general.--In the case of any taxable year 
        beginning after December 31, 2023, each dollar amount in 
        paragraphs (2) and (3) of subsection (c) shall be increased by 
        an amount equal to--
                    ``(A) such dollar amount, multiplied by
                    ``(B) the cost-of-living adjustment determined 
                under section 1(f)(3) for the calendar year in which 
                such taxable year begins determined by substituting 
                `2022' for `2016' in subparagraph (A)(ii) thereof.
            ``(2) Rounding.--If any increase under paragraph (1) is not 
        a multiple of $50, such increase shall be rounded to the 
        nearest multiple of $50.
    ``(h) Reports.--The Secretary may require--
            ``(1) the trustee of a health savings account to make such 
        reports regarding such account to the Secretary and to the 
        account beneficiary with respect to contributions, 
        distributions, the return of excess contributions, and such 
        other matters as the Secretary determines appropriate, and
            ``(2) any person who provides an individual with a 
        qualified health plan to make such reports to the Secretary and 
        to the account beneficiary with respect to such plan as the 
        Secretary determines appropriate.''.
    (b) Employer Contributions to Health Savings Accounts.--
            (1) In general.--Section 106(d) is amended to read as 
        follows:
    ``(d) Contributions to Health Savings Accounts.--
            ``(1) In general.--In the case of an employee who is an 
        eligible individual, amounts contributed by such employee's 
        employer to any health savings account of such employee shall 
        be treated as employer-provided coverage for medical expenses 
        under an accident or health plan to the extent--
                    ``(A) such amounts do not exceed twice the 
                limitation in effect under section 223(b)(2) 
                (determined without regard to this subsection) which is 
                applicable to such employee for such taxable year,
                    ``(B) such amounts are contributed to an account 
                which is integrated with an integration eligible health 
                plan,
                    ``(C) such employer does not offer such employee 
                coverage under any other accident or health plan,
                    ``(D) such employer offers such amounts only to 
                members of a qualified class of employees and offers 
                such amounts to all members of any such qualified 
                class,
                    ``(E) such employer offers employees an opportunity 
                to elect not to receive such amounts at least once per 
                year and upon termination from employment, and
                    ``(F) such employee is not covered under any health 
                insurance offered by an employer of such employee's 
                spouse.
            ``(2) Integration eligible health plan.--For purposes of 
        this subsection, the term `integration eligible health plan' 
        means--
                    ``(A) any bronze, silver, or gold plan offered 
                through an Exchange established under the Patient 
                Protection and Affordable Care Act,
                    ``(B) entitlement to benefits under part A of title 
                XVIII of the Social Security Act and enrollment under 
                part B of such title, including enrollment under a 
                Medicare Advantage plan under part C of such title,
                    ``(C) in the case of any individual who has not 
                attained age 30 or is determined by the Secretary 
                (after consultation with the Secretary of Health and 
                Human Services) to have a hardship, coverage under a 
                catastrophic plan, and
                    ``(D) in the case of any student, coverage under a 
                health plan which is conditioned on maintaining status 
                as being such a student.
            ``(3) Integration of plans and accounts.--For purposes of 
        this subsection, an account shall be treated as integrated with 
        an integration eligible health plan (and such plan shall be 
        treated as integrated with such account) for any month if--
                    ``(A) the employee is the account beneficiary of 
                such account and such employee is covered under an 
                integration eligible health plan for such month,
                    ``(B) the employer verifies that the employee is so 
                covered by requiring the submission of documentation to 
                such employer, and
                    ``(C) the employer makes contributions to such 
                account for such month which are not less than the 
                excess (if any) of--
                            ``(i) the adjusted monthly premiums for the 
                        applicable second lowest cost silver plan with 
                        respect to the taxpayer, over
                            ``(ii) \1/12\ of 9.5 percent of the 
                        taxpayer's household income (within the meaning 
                        of section 36B).
            ``(4) Qualified class.--For purposes of this subsection--
                    ``(A) In general.--The term `qualified class' means 
                only the following: All employees; Full-time employees; 
                Part-time employees; Seasonal employees; Employees 
                covered under a collective bargaining agreement; 
                Employees in a waiting period; Foreign employees who 
                work abroad; Employees working in the same geographic 
                location (same insurance rating area, State, or multi-
                State region); Salaried workers; Non-Salaried workers 
                (such as hourly workers); Temporary employees of 
                staffing firms.
                    ``(B) Rules related to class size.--
                            ``(i) Minimum class size.--A class shall 
                        not be treated as a qualified class unless in 
                        consisting of at least the following number of 
                        employees:
                                    ``(I) In the case of an employer 
                                with fewer than 100 employees, the 
                                lesser of 10 employees or all employees 
                                of the employer.
                                    ``(II) In the case of an employer 
                                with at least 100 and not more than 200 
                                employees, 10 percent of the number of 
                                such employees (if not a whole number, 
                                rounded down to the next lowest whole 
                                number).
                                    ``(III) In the case of an employer 
                                with more than 200 employees, 20 
                                employees.
                            ``(ii) Combination of classes.--Two or more 
                        qualified classes described in subparagraph (A) 
                        may be combined if each such class separately 
                        would not satisfy the requirement of clause 
                        (i).
                    ``(C) Permitted variation within qualified 
                classes.--An employer shall not fail to meet the 
                requirements of paragraph (1)(D) solely because the 
                amounts offered to members of a qualified class vary on 
                the basis of--
                            ``(i) number of dependents,
                            ``(ii) age, if such variation based on age 
                        does not exceed a ratio of 3:1, and
                            ``(iii) chronic health condition, if such 
                        variation based on chronic health condition 
                        does not exceed a ratio of 1.2:1.
            ``(5) Coordination with aca provisions.--In the case of an 
        integration eligible health plan which is integrated with a 
        health savings account--
                    ``(A) such plan shall be treated as an eligible 
                employer-sponsored plan described in section 
                5000A(f)(1)(B),
                    ``(B) if an individual receives contributions to 
                such account which are excludible from the gross income 
                of such individual under this section during any 
                taxable year, no credit shall be allowed under section 
                36B with respect to such individual for such taxable 
                year, and
                    ``(C) for purposes of section 36B(c)(2)(C)(i)(II), 
                the employee's required contribution with respect to 
                such plan shall be treated as being equal to the excess 
                (if any) of--
                            ``(i) the adjusted monthly premiums for the 
                        applicable second lowest cost silver plan with 
                        respect to the taxpayer, over
                            ``(ii) the contributions made the employer 
                        to such health savings account which are 
                        excludible from the gross income of the 
                        employee under this section.
            ``(6) No constructive receipt.--No amount shall be included 
        in the gross income of any employee solely because the employee 
        may choose between the contributions referred to in paragraph 
        (1) and employer contributions to another health plan of the 
        employer.
            ``(7) Special rule for deduction of employer 
        contributions.--Any employer contribution to a health savings 
        account, if otherwise allowable as a deduction under this 
        chapter, shall be allowed only for the taxable year in which 
        paid.
            ``(8) Employer health savings account contributions 
        required to be shown on return.--Every individual required to 
        file a return under section 6012 for the taxable year shall 
        include on such return the aggregate amount contributed by 
        employers to the health savings accounts of such individual or 
        such individual's spouse for such taxable year.
            ``(9) Health savings account contributions not part of 
        cobra coverage.--Paragraph (1) shall not apply for purposes of 
        section 4980B.
            ``(10) Definitions.--Terms used in this subsection which 
        are also used in section 223 shall have the same respective 
        meanings as when used in such section.
            ``(11) Regulations.--The Secretaries of Treasury, Labor, 
        and Health and Human Services shall each issue such regulations 
        or other guidance as may be necessary or appropriate to carry 
        out the purposes of this subsection, including regulations or 
        other guidance to--
                    ``(A) prevent employers from offering plans 
                integrated with health savings accounts selectively to 
                sicker workers, and
                    ``(B) establish a safe harbor that helps employers 
                determine whether contributions to health savings 
                accounts with respect to which there is an integrated 
                health plan comply with affordability requirements 
                under the Patient Protection and Affordable Care Act 
                and the amendments made by such Act.
            ``(12) Cross reference.--For penalty on failure by employer 
        to make comparable contributions to the health savings accounts 
        of comparable employees, see section 4980G.''.
            (2) Nonapplication of erisa.--Contributions by an employer 
        to a health savings account (as defined in section 223 of the 
        Internal Revenue Code of 1986), and an integration eligible 
        health plan which is integrated with such account (within the 
        meaning of such section), shall not be treated as a plan for 
        purposes of the Employee Retirement Income Security Act of 1974 
        if--
                    (A) receipt of such contributions by the employee 
                is voluntary,
                    (B) the employer does not select or endorse the 
                integration eligible health plan which is integrated 
                with such account,
                    (C) no premiums, other than premiums for the 
                integration eligible health plan which is integrated 
                with such account, are paid from the account,
                    (D) the employer receives no consideration (money 
                or other benefit) in connection with the employee 
                selecting or renewing a plan, and
                    (E) each participant is notified annually that such 
                contributions and such plan are not subject to the 
                requirements of such Act.
    (c) Termination of Certain Other Health Care Related Tax 
Benefits.--
            (1) Exclusion limited to self-funded major medical plan of 
        employers.--Section 105(b) of such Code is amended by striking 
        ``paid,'' and inserting ``paid under a self-funded major 
        medical plan of the employer''.
            (2) Exclusion not applicable to health reimbursement 
        arrangements.--Section 105(h) of such Code is amended to read 
        as follows:
    ``(h) Exclusion Not Applicable to Health Reimbursement 
Arrangements.--Subsection (b) shall not apply to health reimbursement 
arrangements.''.
            (3) Repeal of exclusions from income for archer msas and 
        fsas.--Section 106 of such Code is amended by striking 
        subsections (b), (e), and (g).
            (4) Termination of deduction for contributions to archer 
        msas.--Section 220(a) of such Code is amended by adding at the 
        end the following: ``No amount shall be allowed as a deduction 
        under the preceding sentence for any taxable year beginning 
        after one year after the date of the enactment of this 
        sentence.''.
    (d) Bankruptcy Protections.--Section 522 of title 11, United States 
Code, is amended by adding at the end the following new subsection:
    ``(r) For purposes of this section, any health savings account (as 
described in section 223 of the Internal Revenue Code of 1986) shall be 
treated in the same manner as an individual retirement account 
described in section 408 of such Code.''.
    (e) Rollover of FSA, Archer MSA, HRA to Health Savings Account.--
Notwithstanding any other provision of law, if the remaining balance in 
a health flexible spending arrangement, Archer MSA, or health 
reimbursement arrangement is transferred to a health savings account 
before the end of any taxable year ending on or before one year after 
the date of the enactment of this Act, such transfer shall be treated 
as a rollover to the health savings account under section 223(f)(5) of 
the Internal Revenue Code of 1986 and the distribution from the health 
flexible spending arrangement, Archer MSA, or health reimbursement 
arrangement shall not be includible in gross income.
    (f) Effective Dates.--
            (1) In general.--The amendments made by subsections (a) and 
        (b) shall apply to taxable years beginning after the date of 
        the enactment of this Act.
            (2) Termination of certain other health care related tax 
        benefits.--The amendments made by subsection (c) shall apply to 
        taxable years beginning after the date which is 1 year after 
        the date of the enactment of this Act.
            (3) Bankruptcy protections.--The amendment made by 
        subsection (d) shall apply to cases commencing under title 11, 
        United States Code, after the date of the enactment of this 
        Act.

SEC. 102. UNUSED PREMIUM TAX CREDITS MAY BE DEPOSITED IN HEALTH SAVINGS 
              ACCOUNTS.

    (a) In General.--Section 36B is amended by redesignating subsection 
(h) as subsection (i) and by inserting after subsection (g) the 
following new subsection:
    ``(h) Excess Credit May Be Deposited Into a Health Savings 
Account.--
            ``(1) In general.--If the amount described in subparagraph 
        (B) of subsection (b)(2) exceeds the amount described in 
        subparagraph (A) of such subsection with respect to any 
        coverage month and an election under paragraph (2) is in effect 
        with respect to the applicable taxpayer, the Secretary shall 
        deposit such excess into a health savings account of such 
        taxpayer.
            ``(2) Election to deposit excess credit into a health 
        savings account.--A taxpayer may elect (at such time and in 
        such manner as the Secretary may provide) to have the Secretary 
        deposit the excess described in paragraph (1) into a health 
        savings account of the taxpayer. Any such election shall only 
        be treated as being in effect if the taxpayer provides the 
        Secretary with such information as the Secretary may require to 
        allow the Secretary to make such deposit.
            ``(3) Coordination with health savings account rules.--Any 
        amount deposited in a health savings account by the Secretary 
        under this subsection shall--
                    ``(A) be includible in the gross income of the 
                applicable taxpayer, and
                    ``(B) be taken into account as an amount paid to 
                such account for purposes of this section.
            ``(4) Treatment of deposits.--For purposes of section 1324 
        of title 31, United States Code, any deposit made under this 
        subsection shall be treated as a credit allowed under this 
        section.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 103. HEALTH REIMBURSEMENT ARRANGEMENTS AND OTHER ACCOUNT-BASED 
              GROUP HEALTH PLANS.

    The rule published by the Internal Revenue Service, the Employee 
Benefits Security Administration, and the Health and Human Services 
Department relating to ``Health Reimbursement Arrangements and Other 
Account-Based Group Health Plans'' (June 20, 2019) shall have the force 
and effect of law. Health Reimbursement Arrangements as described in 
this rule are subject to all sections in this title.

SEC. 104. COST-SHARING REDUCTION PAYMENTS AS ELIGIBLE CONTRIBUTIONS.

    (a) Alternative Waiver for State Innovation.--Section 1332 of the 
Patient Protection and Affordable Care Act (42 U.S.C. 18052) is amended 
by adding at the end the following new subsection:
    ``(f) Alternative Waiver for State Innovation.--
            ``(1) In general.--Notwithstanding any preceding provision 
        of this section, a State may apply to the Secretary for the 
        waiver of any requirement of subsection (a)(2) with respect to 
        health insurance coverage within that State for plan years 
        beginning on or after January 1, 2023, if instead of complying 
        with section 1402 the State provides for the distribution of 
        funding received under paragraph (2) to health savings accounts 
        of qualifying individuals with respect to such State. Such 
        application shall be filed at such time and in such manner as 
        the Secretary may require, and shall include such information 
        as the Secretary may require (including a 10-year budget plan 
        for such plan that is budget neutral for the Federal 
        Government).
            ``(2) Pass-through funding.--With respect to a State waiver 
        under paragraph (1), under which, due to the structure of such 
        waiver, individuals in the State would not qualify for cost-
        sharing reductions under section 1402 for which they would 
        otherwise be eligible, the Secretary shall provide for an 
        alternative means by which an amount is transferred to the 
        State equal to the aggregate amount of such reductions that 
        would have been paid on behalf of the participants in the 
        Exchanges established under this title--
                    ``(A) had the State not received such waiver;
                    ``(B) had references to `eligible insureds' under 
                section 1402 referred to `qualifying insureds (as 
                defined in section 1332(f))';
                    ``(C) had, after application of clause (ii), in the 
                case of a qualifying insured enrolled in the bronze 
                level of coverage--
                            ``(i) the percentages specified in 
                        subclauses (I), (II), and (III) of section 
                        1402(c)(1)(B) were references to 84 percent, 77 
                        percent, and 63 percent, respectively; and
                            ``(ii) the references in subparagraphs (A), 
                        (B), and (C) of section 1402(c)(2) to 94 
                        percent, 87 percent, and 73 percent, 
                        respectively, were references to 84 percent, 77 
                        percent, and 63 percent, respectively; and
                    ``(D) had, after application of clause (ii), in the 
                case of a qualifying insured enrolled in the copper 
                level of coverage--
                            ``(i) the percentages specified in 
                        subclauses (I), (II), and (III) of section 
                        1402(c)(1)(B) were references to 74 percent, 67 
                        percent, and 53 percent, respectively; and
                            ``(ii) the references in subparagraphs (A), 
                        (B), and (C) of section 1402(c)(2) to 94 
                        percent, 87 percent, and 73 percent, 
                        respectively, were references to 74 percent, 67 
                        percent, and 53 percent, respectively.
        The amount transferred pursuant to the previous sentence shall 
        be determined annually by the Secretary, taking into 
        consideration the experience of other States with respect to 
        participation in an Exchange and reductions provided under such 
        provisions to residents of the other States, and shall be paid 
        to the State for purposes of implementing such waiver.
            ``(3) Waiver consideration and transparency.--The 
        provisions of paragraph (4) of subsection (a) shall apply to an 
        application for a waiver under paragraph (1) in the same manner 
        as such provisions apply with respect to an application for a 
        waiver under subsection (a)(1), except that, for purposes of 
        this paragraph, the provisions of subsection (a)(4)(B)(ii) 
        shall not apply.
            ``(4) Determinations; term of waiver.--The provisions of 
        subsections (d) and (e) shall apply with respect to a 
        determination with respect to an application under paragraph 
        (1), and with respect to the term of a waiver under such 
        paragraph, in the same manner as such provisions apply with 
        respect to a determination with respect to an application under 
        subsection (a)(1), and with respect to the term of a waiver 
        under such subsection.
            ``(5) Definitions.--For purposes of this subsection:
                    ``(A) Health savings account.--The term `health 
                savings account' has the meaning given such term in 
                section 223 of the Internal Revenue Code of 1986.
                    ``(B) Qualifying insured.--The term `qualifying 
                insured' means, with respect to a State and a year, an 
                individual--
                            ``(i) who is enrolled in a health savings 
                        account;
                            ``(ii) who is enrolled for such year in a 
                        silver, bronze, or copper level coverage 
                        offered through an Exchange; and
                            ``(iii) whose household income is not more 
                        than 250 percent of the Federal poverty line 
                        for a family of the size involved.''.
    (b) Additional Amendments.--Section 1402 of the Patient Protection 
and Affordable Care Act (42 U.S.C. 18071) is amended by striking ``not 
less than 100 percent but'' and ``exceeds 100 percent but'' and ``more 
than 100 percent but'' each place such phrases appear.
    (c) Conforming Amendments.--Section 1332 of the Patient Protection 
and Affordable Care Act (42 U.S.C. 18052), as amended by subsection 
(a), is further amended in subsection (a)(4)--
            (1) in subparagraph (A) by striking the period and 
        inserting ``, except in the case of a waiver described in 
        subsection (f).''; and
            (2) in subparagraph (B)(ii) by inserting after ``an 
        application'' the following: ``(except in the case of a waiver 
        described in subsection (f))''.
    (d) Appropriation for Cost-Sharing Payments.--Section 1402 of the 
Patient Protection and Affordable Care Act (42 U.S.C. 18071) is amended 
by adding at the end the following new subsection:
    ``(g) Funding.--
            ``(1) Appropriations.--Out of any funds in the Treasury not 
        otherwise appropriated, there is appropriated such sums as may 
        be necessary to, subject to paragraph (2), provide health 
        benefits coverage through payment to issuers (under this 
        section or through advance payment by the Secretary of the 
        Treasury under section 1412(c)(3)) of the amounts computed 
        under this section for each of plan years 2023 through 2027.
            ``(2) Adjustments.--Notwithstanding any other provision of 
        law, payments and other actions for adjustments to obligations 
        incurred prior to December 31, 2023, may be made through 
        December 31, 2023.
            ``(3) Limitation.--Amounts appropriated under paragraph (1) 
        for each of plan years 2023 through 2027 are subject to the 
        requirements and limitations under sections 506 and 507 of 
        division H of Public Law 115-31 in the same manner and to the 
        same extent as if such amounts for each such year were 
        appropriated under such division.''.

SEC. 105. DIRECT PRIMARY CARE.

    (a) In General.--Section 223(c)(1) of the Internal Revenue Code of 
1986 is amended by adding at the end the following new subparagraph:
                    ``(D) Treatment of direct primary care service 
                arrangements.--
                            ``(i) In general.--A direct primary care 
                        service arrangement shall not be treated as a 
                        health plan for purposes of subparagraph 
                        (A)(ii).
                            ``(ii) Direct primary care service 
                        arrangement.--For purposes of this paragraph--
                                    ``(I) In general.--The term `direct 
                                primary care service arrangement' 
                                means, with respect to any individual, 
                                an arrangement under which such 
                                individual is provided medical care (as 
                                defined in section 213(d)) consisting 
                                solely of primary care services 
                                provided by primary care practitioners 
                                (as defined in section 1833(x)(2)(A) of 
                                the Social Security Act, determined 
                                without regard to clause (ii) thereof), 
                                if the sole compensation for such care 
                                is a fixed periodic fee.
                                    ``(II) Limitation.--With respect to 
                                any individual for any month, such term 
                                shall not include any arrangement if 
                                the aggregate fees for all direct 
                                primary care service arrangements 
                                (determined without regard to this 
                                subclause) with respect to such 
                                individual for such month exceed $150 
                                (twice such dollar amount in the case 
                                of an individual with any direct 
                                primary care service arrangement (as so 
                                determined) that covers more than one 
                                individual).
                            ``(iii) Certain services specifically 
                        excluded from treatment as primary care 
                        services.--For purposes of this paragraph, the 
                        term `primary care services' shall not 
                        include--
                                    ``(I) procedures that require the 
                                use of general anesthesia, and
                                    ``(II) laboratory services not 
                                typically administered in an ambulatory 
                                primary care setting.
                        The Secretary, after consultation with the 
                        Secretary of Health and Human Services, shall 
                        issue regulations or other guidance regarding 
                        the application of this clause.''.
    (b) Direct Primary Care Service Arrangement Fees Treated as Medical 
Expenses.--Section 223(d)(2)(C) is amended by striking ``or'' at the 
end of clause (iii), by striking the period at the end of clause (iv) 
and inserting ``, or'', and by adding at the end the following new 
clause:
    ``(v) any direct primary care service arrangement.''.
    (c) Inflation Adjustment.--Section 223(g)(1) of such Code is 
amended--
            (1) by inserting ``, (c)(1)(D)(ii)(II),'' after ``(b)(2),'' 
        each place such term appears, and
            (2) in subparagraph (B), by inserting ``and (iii)'' after 
        ``clause (ii)'' in clause (i), by striking ``and'' at the end 
        of clause (i), by striking the period at the end of clause (ii) 
        and inserting ``, and'', and by inserting after clause (ii) the 
        following new clause:
                            ``(iii) in the case of the dollar amount in 
                        subsection (c)(1)(D)(ii)(II) for taxable years 
                        beginning in calendar years after 2020, 
                        calendar year 2019.''.
    (d) Reporting of Direct Primary Care Service Arrangement Fees on W-
2.--Section 6051(a) of such Code is amended by striking ``and'' at the 
end of paragraph (16), by striking the period at the end of paragraph 
(17) and inserting ``, and'', and by inserting after paragraph (17) the 
following new paragraph:
            ``(18) in the case of a direct primary care service 
        arrangement (as defined in section 223(c)(1)(D)(ii)) which is 
        provided in connection with employment, the aggregate fees for 
        such arrangement for such employee.''.
    (e) Effective Date.--The amendments made by this section shall 
apply to months beginning after December 31, 2022, in taxable years 
ending after such date.

           Subtitle B--Assistance to Health Savings Accounts

SEC. 111. ONE-TIME APPLICATION OF SAVER'S CREDIT TO CONTRIBUTIONS TO 
              HEALTH SAVINGS ACCOUNTS.

    (a) In General.--In the case of an applicable taxable year, 
contributions to any health savings account of the taxpayer during such 
taxable year shall be treated as a qualified retirement savings 
contribution for purposes of section 25B of the Internal Revenue Code 
of 1986.
    (b) Applicable Taxable Year.--For purposes of this section, the 
term ``applicable taxable year'' means any taxable year elected by the 
taxpayer (at such time and in such manner as the Secretary of the 
Treasury may provide) which begins after during the 3-year period 
beginning 1 year after the date of the enactment of this Act. A 
taxpayer may not elect not more than 1 applicable taxable year under 
this subsection.

SEC. 112. GRANTS FOR HEALTH SAVINGS ACCOUNT ASSISTANCE AND OUTREACH.

    (a) In General.--The Administrator shall establish a grant program 
to provide assistance to eligible entities to carry out the activities 
described in subsection (c).
    (b) Application.--An eligible entity shall submit an application to 
the Administrator in such time and in such manner as the Administrator 
may require, providing that such application requires a demonstration 
of the existence of a relationship with, or the ability to establish a 
relationship with, an employer, employee, self-employed individual, or 
consumer eligible to enroll in a health savings account.
    (c) Use of Funds.--An eligible entity receiving a grant under this 
section shall use such funds to--
            (1) distribute fair and impartial information to consumers 
        about health savings accounts, including the availability of 
        such accounts and how such accounts may be utilized;
            (2) conduct activities to raise public awareness of health 
        savings accounts;
            (3) facilitate enrollment in health savings accounts; and
            (4) refer individuals enrolled in a health savings account 
        to the appropriate official, organization, or State agency for 
        the purpose of addressing a complaint, grievance, or other 
        question with respect to such health savings account.
    (d) Amount.--The Administrator may distribute up to $5,000,000 
annually to be divided among grant recipients under this section.
    (e) Report.--Not later than one year after the date on which the 
last of the grant periods awarded under this section ends, the 
Administrator shall submit a report to the Congress on the 
effectiveness of the grants provided under this section.
    (f) Definitions.--In this section:
            (1) Administrator.--The term ``Administrator'' means the 
        Administrator of the Centers for Medicare & Medicaid Services.
            (2) Consumer.--The term ``consumer'' means an individual 
        enrolled in, or seeking to enroll in, a health savings account.
            (3) Eligible entity.--The term ``eligible entity'' includes 
        the following:
                    (A) A State.
                    (B) Trade.
                    (C) Industry.
                    (D) Professional associations.
                    (E) Commercial fishing industry organizations.
                    (F) Ranching and farming organizations.
                    (G) Community and consumer-focused nonprofit 
                groups.
                    (H) Chambers of commerce.
                    (I) Unions.
                    (J) Small business development centers (as defined 
                in section 21 of the Small Business Act (15 U.S.C. 
                648)).
                    (K) Other entities capable of carrying out the 
                activities described under subsection (b).
            (4) Health savings account.--The term ``health savings 
        account'' has the meaning given such term in section 223 of the 
        Internal Revenue Code of 1986.
            (5) State.--The term ``State'' means each of the several 
        States, the District of Columbia, each territory and possession 
        of the United States, and each federally recognized Indian 
        Tribe.

SEC. 113. NEW CORPORATIONS REQUIRED TO USE HEALTH SAVINGS ACCOUNTS.

    Notwithstanding any other provision of law, a corporation 
incorporated after December 31, 2022, may not receive tax benefits for 
offering employees health insurance. The previous sentence shall not 
apply to health savings account contributions offered by such a 
corporation.

SEC. 114. FEDERAL EMPLOYEE HEALTH BENEFITS AND HEALTH SAVINGS ACCOUNTS.

    (a) In General.--Section 1312(d)(3)(D) of the Patient Protection 
and Affordable Care Act (42 U.S.C. 18032(d)(3)(D)) is amended--
            (1) in the subparagraph heading, by striking ``Members of 
        congress'' and inserting ``President, vice president, members 
        of congress, and federal employees'';
            (2) in clause (i), in the matter preceding subclause (I)--
                    (A) by striking ``Members of Congress and 
                congressional staff'' and inserting ``the President, 
                Vice President, Members of Congress, and Federal 
                employees''; and
                    (B) by striking ``a Member of Congress or 
                congressional staff'' and inserting ``the President, 
                the Vice President, a Member of Congress, or a Federal 
                employee''; and
            (3) in clause (ii), by amending subclause (II) to read as 
        follows:
                                    ``(II) Federal employee.--The term 
                                `Federal employee' means--
                                            ``(aa) an `employee', as 
                                        such term is defined in section 
                                        2105 of title 5, United States 
                                        Code; and
                                            ``(bb) includes an 
                                        individual to whom subsection 
                                        (c) or (f) of such section 2105 
                                        pertains (whether or not such 
                                        individual satisfies item 
                                        (aa)).''.
    (b) Conversion to Health Savings Accounts.--Each plan offered under 
chapter 89 of title 5, United States Code, shall be converted into a 
health savings account deposit and funded at the level of the second-
least expensive silver plan available through the Exchange where the 
applicable individual resides.

              TITLE II--IMPROVING PRIVATE HEALTH INSURANCE

   Subtitle A--Maintaining Protections for Patients With Preexisting 
                               Conditions

SEC. 201. GUARANTEED AVAILABILITY OF COVERAGE; PROHIBITING 
              DISCRIMINATION.

    (a) In General.--Subtitle C of title I of the Health Insurance 
Portability and Accountability Act of 1996 (Public Law 104-191) is 
amended by adding at the end the following:

``SEC. 196. GUARANTEED AVAILABILITY OF COVERAGE.

    ``(a) Guaranteed Issuance of Coverage in the Individual and Group 
Market.--Subject to subsections (b) through (d), 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 
        regulations with respect to enrollment periods under paragraphs 
        (1) and (2).
    ``(c) Special Rules for Network Plans.--
            ``(1) In general.--In the case of a health insurance issuer 
        that offers health insurance coverage in the group and 
        individual market through a network plan, the issuer may--
                    ``(A) limit the employers that may apply for such 
                coverage to those with eligible individuals who live, 
                work, or reside in the service area for such network 
                plan; and
                    ``(B) within the service area of such plan, deny 
                such coverage to such employers and individuals if the 
                issuer has demonstrated, if required, to the applicable 
                State authority that--
                            ``(i) it will not have the capacity to 
                        deliver services adequately to enrollees of any 
                        additional groups or any additional individuals 
                        because of its obligations to existing group 
                        contract holders and enrollees; and
                            ``(ii) it is applying this paragraph 
                        uniformly to all employers and individuals 
                        without regard to the claims experience of 
                        those individuals, employers and their 
                        employees (and their dependents), or any health 
                        status-related factor relating to such 
                        individuals, employees, and dependents.
            ``(2) 180-day suspension upon denial of coverage.--An 
        issuer, upon denying health insurance coverage in any service 
        area in accordance with paragraph (1)(B), may not offer 
        coverage in the group or individual market within such service 
        area for a period of 180 days after the date such coverage is 
        denied.
    ``(d) Application of Financial Capacity Limits.--
            ``(1) In general.--A health insurance issuer may deny 
        health insurance coverage in the group or individual market if 
        the issuer has demonstrated, if required, to the applicable 
        State authority that--
                    ``(A) it does not have the financial reserves 
                necessary to underwrite additional coverage; and
                    ``(B) it is applying this paragraph uniformly to 
                all employers and individuals in the group or 
                individual market in the State consistent with 
                applicable State law and without regard to the claims 
                experience of those individuals, employers and their 
                employees (and their dependents) or any health status-
                related factor relating to such individuals, employees, 
                and dependents.
            ``(2) 180-day suspension upon denial of coverage.--A health 
        insurance issuer upon denying health insurance coverage in 
        connection with group health plans in accordance with paragraph 
        (1) in a State may not offer coverage in connection with group 
        health plans in the group or individual market in the State for 
        a period of 180 days after the date such coverage is denied or 
        until the issuer has demonstrated to the applicable State 
        authority, if required under applicable State law, that the 
        issuer has sufficient financial reserves to underwrite 
        additional coverage, whichever is later. An applicable State 
        authority may provide for the application of this subsection on 
        a service-area-specific basis.
    ``(e) Definitions.--In this section and in sections 197 through 
199A:
            ``(1) The term `Secretary' means the Secretary of Health 
        and Human Services.
            ``(2) The terms `genetic information', `genetic test', 
        `group health plan', `group market', `health insurance 
        coverage', `health insurance issuer', `group health insurance 
        coverage', `individual health insurance coverage', `individual 
        market', and `underwriting purpose' have the meanings given 
        such terms in section 2791 of the Public Health Service Act.

``SEC. 197. 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 coverage 
        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 individual or family;
                            ``(ii) rating area, as established in 
                        accordance with paragraph (2);
                            ``(iii) age, except that such rate shall 
                        not vary by more than 5 to 1 for adults; 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 
                particular 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 
                subparagraph (A) to ensure the adequacy of such areas 
                for purposes of carrying out the requirements of this 
                title. If the Secretary 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 
        consultation 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 permitted 
        under clauses (iii) and (iv) of paragraph (1)(A) shall be 
        applied based on the portion of the premium that is 
        attributable to each family member covered under the plan or 
        coverage.

``SEC. 198. 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 relation 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.
    ``(b) In Premium Contributions.--
            ``(1) In general.--A group health plan, and a health 
        insurance issuer offering group or individual health insurance 
        coverage, may not require any individual (as a condition of 
        enrollment or continued enrollment under the plan) to pay a 
        premium or contribution which is greater than such premium or 
        contribution for a similarly situated individual enrolled in 
        the plan on the basis of any health status-related factor in 
        relation to the individual or to an individual enrolled under 
        the plan as a dependent of the individual.
            ``(2) Construction.--Nothing in paragraph (1) shall be 
        construed--
                    ``(A) to restrict the amount that an employer or 
                individual may be charged for coverage under a group 
                health plan except as provided in paragraph (3) or 
                individual health coverage, as the case may be; or
                    ``(B) to prevent a group health plan, and a health 
                insurance issuer offering group health insurance 
                coverage, from establishing premium discounts or 
                rebates or modifying otherwise applicable copayments or 
                deductibles in return for adherence to programs of 
                health promotion and disease prevention.
            ``(3) No group-based discrimination on basis of genetic 
        information.--
                    ``(A) In general.--For purposes of this section, a 
                group health plan, and health insurance issuer offering 
                group health insurance coverage in connection with a 
                group health plan, may not adjust premium or 
                contribution amounts for the group covered under such 
                plan on the basis of genetic information.
                    ``(B) Rule of construction.--Nothing in 
                subparagraph (A) or in paragraphs (1) and (2) of 
                subsection (d) shall be construed to limit the ability 
                of a health insurance issuer offering group or 
                individual health insurance coverage to increase the 
                premium for an employer based on the manifestation of a 
                disease or disorder of an individual who is enrolled in 
                the plan. In such case, the manifestation of a disease 
                or disorder in one individual cannot also be used as 
                genetic information about other group members and to 
                further increase the premium for the employer.
    ``(c) Genetic Testing.--
            ``(1) Limitation on requesting or requiring genetic 
        testing.--A group health plan, and a health insurance issuer 
        offering health insurance coverage in connection with a group 
        health plan, shall not request or require an individual or a 
        family member of such individual to undergo a genetic test.
            ``(2) Rule of construction.--Paragraph (1) shall not be 
        construed to limit the authority of a health care professional 
        who is providing health care services to an individual to 
        request that such individual undergo a genetic test.
            ``(3) Rule of construction regarding payment.--
                    ``(A) In general.--Nothing in paragraph (1) shall 
                be construed to preclude a group health plan, or a 
                health insurance issuer offering health insurance 
                coverage in connection with a group health plan, from 
                obtaining and using the results of a genetic test in 
                making a determination regarding payment (as such term 
                is defined for the purposes of applying the regulations 
                promulgated by the Secretary under part C of title XI 
                of the Social Security Act and section 264 of this Act, 
                as may be revised from time to time) consistent with 
                subsection (a).
                    ``(B) Limitation.--For purposes of subparagraph 
                (A), a group health plan, or a health insurance issuer 
                offering health insurance coverage in connection with a 
                group health plan, may request only the minimum amount 
                of information necessary to accomplish the intended 
                purpose.
            ``(4) Research exception.--Notwithstanding paragraph (1), a 
        group health plan, or a health insurance issuer offering health 
        insurance coverage in connection with a group health plan, may 
        request, but not require, that a participant or beneficiary 
        undergo a genetic test if each of the following conditions is 
        met:
                    ``(A) The request is made pursuant to research that 
                complies with part 46 of title 45, Code of Federal 
                Regulations, or equivalent Federal regulations, and any 
                applicable State or local law or regulations for the 
                protection of human subjects in research.
                    ``(B) The plan or issuer clearly indicates to each 
                participant or beneficiary, or in the case of a minor 
                child, to the legal guardian of such beneficiary, to 
                whom the request is made that--
                            ``(i) compliance with the request is 
                        voluntary; and
                            ``(ii) noncompliance will have no effect on 
                        enrollment status or premium or contribution 
                        amounts.
                    ``(C) No genetic information collected or acquired 
                under this paragraph shall be used for underwriting 
                purposes.
                    ``(D) The plan or issuer notifies the Secretary in 
                writing that the plan or issuer is conducting 
                activities pursuant to the exception provided for under 
                this paragraph, including a description of the 
                activities conducted.
                    ``(E) The plan or issuer complies with such other 
                conditions as the Secretary may by regulation require 
                for activities conducted under this paragraph.
    ``(d) Prohibition on Collection of Genetic Information.--
            ``(1) In general.--A group health plan, and a health 
        insurance issuer offering health insurance coverage in 
        connection with a group health plan, shall not request, 
        require, or purchase genetic information for underwriting 
        purposes.
            ``(2) Prohibition on collection of genetic information 
        prior to enrollment.--A group health plan, and a health 
        insurance issuer offering health insurance coverage in 
        connection with a group health plan, shall not request, 
        require, or purchase genetic information with respect to any 
        individual prior to such individual's enrollment under the plan 
        or coverage in connection with such enrollment.
            ``(3) Incidental collection.--If a group health plan, or a 
        health insurance issuer offering health insurance coverage in 
        connection with a group health plan, obtains genetic 
        information incidental to the requesting, requiring, or 
        purchasing of other information concerning any individual, such 
        request, requirement, or purchase shall not be considered a 
        violation of paragraph (2) if such request, requirement, or 
        purchase is not in violation of paragraph (1).
    ``(e) Genetic Information of a Fetus or Embryo.--Any reference in 
this part to genetic information concerning an individual or family 
member of an individual shall--
            ``(1) with respect to such an individual or family member 
        of an individual who is a pregnant woman, include genetic 
        information of any fetus carried by such pregnant woman; and
            ``(2) with respect to an individual or family member 
        utilizing an assisted reproductive technology, include genetic 
        information of any embryo legally held by the individual or 
        family member.
    ``(f) Programs of Health Promotion or Disease Prevention.--
            ``(1) General provisions.--
                    ``(A) General rule.--For purposes of subsection 
                (b)(2)(B), a program of health promotion or disease 
                prevention (referred to in this subsection as a 
                `wellness program') shall be a program offered by an 
                employer that is designed 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 participation 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 requirements.--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 
        participation 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 addition to employees or 
                individuals, any class of dependents (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 mechanism (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 Secretaries 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 appropriate.
                    ``(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 preventing 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 statement from an 
                        individual's physician, that a health status 
                        factor makes it unreasonably difficult or 
                        medically inadvisable for the individual to 
                        satisfy or attempt to satisfy the otherwise 
                        applicable standard.
                    ``(E) The plan or issuer involved shall disclose in 
                all plan materials describing the terms of the wellness 
                program the availability of a reasonable alternative 
                standard (or the possibility of waiver of the otherwise 
                applicable standard) required under subparagraph (D). 
                If plan materials disclose that such a program is 
                available, without describing its terms, the disclosure 
                under this subparagraph shall not be required.

``SEC. 199. 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.
    ``(b) Definitions.--For purposes of this section--
            ``(1) Preexisting condition exclusion.--
                    ``(A) In general.--The term `preexisting condition 
                exclusion' means, with respect to coverage, a 
                limitation or exclusion of benefits relating to a 
                condition based on the fact that the condition was 
                present before the date of enrollment for such 
                coverage, whether or not any medical advice, diagnosis, 
                care, or treatment was recommended or received before 
                such date.
                    ``(B) Treatment of genetic information.--Genetic 
                information shall not be treated as a condition 
                described in subsection (a)(1) in the absence of a 
                diagnosis of the condition related to such information.
            ``(2) Enrollment date.--The term `enrollment date' means, 
        with respect to an individual covered under a group health plan 
        or health insurance coverage, the date of enrollment of the 
        individual in the plan or coverage or, if earlier, the first 
        day of the waiting period for such enrollment.
            ``(3) Late enrollee.--The term `late enrollee' means, with 
        respect to coverage under a group health plan, a participant or 
        beneficiary who enrolls under the plan other than during--
                    ``(A) the first period in which the individual is 
                eligible to enroll under the plan; or
                    ``(B) a special enrollment period under subsection 
                (f).
            ``(4) Waiting period.--The term `waiting period' means, 
        with respect to a group health plan and an individual who is a 
        potential participant or beneficiary in the plan, the period 
        that must pass with respect to the individual before the 
        individual is eligible to be covered for benefits under the 
        terms of the plan.
    ``(c) Rules Relating to Crediting Previous Coverage.--
            ``(1) Creditable coverage defined.--For purposes of this 
        title, the term `creditable coverage' means, with respect to an 
        individual, coverage of the individual under any of the 
        following:
                    ``(A) A group health plan.
                    ``(B) Health insurance coverage.
                    ``(C) Part A or part B of title XVIII of the Social 
                Security Act.
                    ``(D) Title XIX of the Social Security Act, other 
                than coverage consisting solely of benefits under 
                section 1928.
                    ``(E) Chapter 55 of title 10, United States Code.
                    ``(F) A medical care program of the Indian Health 
                Service or of a tribal organization.
                    ``(G) A State health benefits risk pool.
                    ``(H) A health plan offered under chapter 89 of 
                title 5, United States Code.
                    ``(I) A public health plan (as defined in 
                regulations).
                    ``(J) A health benefit plan under section 5(e) of 
                the Peace Corps Act (22 U.S.C. 2504(e)).
        Such term does not include coverage consisting solely of 
        coverage of excepted benefits (as defined in section 2791(c)).
            ``(2) Not counting periods before significant breaks in 
        coverage.--
                    ``(A) In general.--A period of creditable coverage 
                shall not be counted, with respect to enrollment of an 
                individual under a group or individual health plan, if, 
                after such period and before the enrollment date, there 
                was a 63-day period during all of which the individual 
                was not covered under any creditable coverage.
                    ``(B) Waiting period not treated as a break in 
                coverage.--For purposes of subparagraph (A) and 
                subsection (d)(4), any period that an individual is in 
                a waiting period for any coverage under a group or 
                individual health plan (or for group health insurance 
                coverage) or is in an affiliation period (as defined in 
                subsection (g)(2)) shall not be taken into account in 
                determining the continuous period under subparagraph 
                (A).
                    ``(C) TAA-eligible individuals.--In the case of 
                plan years beginning before January 1, 2014--
                            ``(i) TAA pre-certification period rule.--
                        In the case of a TAA-eligible individual, the 
                        period beginning on the date the individual has 
                        a TAA-related loss of coverage and ending on 
                        the date that is 7 days after the date of the 
                        issuance by the Secretary (or by any person or 
                        entity designated by the Secretary) of a 
                        qualified health insurance costs credit 
                        eligibility certificate for such individual for 
                        purposes of section 7527 of the Internal 
                        Revenue Code of 1986 shall not be taken into 
                        account in determining the continuous period 
                        under subparagraph (A).
                            ``(ii) Definitions.--The terms `TAA-
                        eligible individual' and `TAA-related loss of 
                        coverage' have the meanings given such terms in 
                        section 2205(b)(4).
            ``(3) Method of crediting coverage.--
                    ``(A) Standard method.--Except as otherwise 
                provided under subparagraph (B), for purposes of 
                applying subsection (a)(3), a group health plan, and a 
                health insurance issuer offering group or individual 
                health insurance coverage, shall count a period of 
                creditable coverage without regard to the specific 
                benefits covered during the period.
                    ``(B) Election of alternative method.--A group 
                health plan, or a health insurance issuer offering 
                group or individual health insurance, may elect to 
                apply subsection (a)(3) based on coverage of benefits 
                within each of several classes or categories of 
                benefits specified in regulations rather than as 
                provided under subparagraph (A). Such election shall be 
                made on a uniform basis for all participants and 
                beneficiaries. Under such election a group or 
                individual health plan or issuer shall count a period 
                of creditable coverage with respect to any class or 
                category of benefits if any level of benefits is 
                covered within such class or category.
                    ``(C) Plan notice.--In the case of an election with 
                respect to a group health plan under subparagraph (B) 
                (whether or not health insurance coverage is provided 
                in connection with such plan), the plan shall--
                            ``(i) prominently state in any disclosure 
                        statements concerning the plan, and state to 
                        each enrollee at the time of enrollment under 
                        the plan, that the plan has made such election; 
                        and
                            ``(ii) include in such statements a 
                        description of the effect of this election.
                    ``(D) Issuer notice.--In the case of an election 
                under subparagraph (B) with respect to health insurance 
                coverage offered by an issuer in the individual or 
                group market, the issuer--
                            ``(i) shall prominently state in any 
                        disclosure statements concerning the coverage, 
                        and to each employer at the time of the offer 
                        or sale of the coverage, that the issuer has 
                        made such election; and
                            ``(ii) shall include in such statements a 
                        description of the effect of such election.
            ``(4) Establishment of period.--Periods of creditable 
        coverage with respect to an individual shall be established 
        through presentation of certifications described in subsection 
        (e) or in such other manner as may be specified in regulations.
    ``(d) Exceptions.--
            ``(1) Exclusion not applicable to certain newborns.--
        Subject to paragraph (4), a group health plan, and a health 
        insurance issuer offering group or individual health insurance 
        coverage, may not impose any preexisting condition exclusion in 
        the case of an individual who, as of the last day of the 30-day 
        period beginning with the date of birth, is covered under 
        creditable coverage.
            ``(2) Exclusion not applicable to certain adopted 
        children.--Subject to paragraph (4), a group health plan, and a 
        health insurance issuer offering group or individual health 
        insurance coverage, may not impose any preexisting condition 
        exclusion in the case of a child who is adopted or placed for 
        adoption before attaining 18 years of age and who, as of the 
        last day of the 30-day period beginning on the date of the 
        adoption or placement for adoption, is covered under creditable 
        coverage. The previous sentence shall not apply to coverage 
        before the date of such adoption or placement for adoption.
            ``(3) Exclusion not applicable to pregnancy.--A group 
        health plan, and health insurance issuer offering group or 
        individual health insurance coverage, may not impose any 
        preexisting condition exclusion relating to pregnancy as a 
        preexisting condition.
            ``(4) Loss if break in coverage.--Paragraphs (1) and (2) 
        shall no longer apply to an individual after the end of the 
        first 63-day period during all of which the individual was not 
        covered under any creditable coverage.
    ``(e) Certifications and Disclosure of Coverage.--
            ``(1) Requirement for certification of period of creditable 
        coverage.--
                    ``(A) In general.--A group health plan, and a 
                health insurance issuer offering group or individual 
                health insurance coverage, shall provide the 
                certification described in subparagraph (B)--
                            ``(i) at the time an individual ceases to 
                        be covered under the plan or otherwise becomes 
                        covered under a COBRA continuation provision;
                            ``(ii) in the case of an individual 
                        becoming covered under such a provision, at the 
                        time the individual ceases to be covered under 
                        such provision; and
                            ``(iii) on the request on behalf of an 
                        individual made not later than 24 months after 
                        the date of cessation of the coverage described 
                        in clause (i) or (ii), whichever is later.
                The certification under clause (i) may be provided, to 
                the extent practicable, at a time consistent with 
                notices required under any applicable COBRA 
                continuation provision.
                    ``(B) Certification.--The certification described 
                in this subparagraph is a written certification of--
                            ``(i) the period of creditable coverage of 
                        the individual under such plan and the coverage 
                        (if any) under such COBRA continuation 
                        provision; and
                            ``(ii) the waiting period (if any) (and 
                        affiliation period, if applicable) imposed with 
                        respect to the individual for any coverage 
                        under such plan.
                    ``(C) Issuer compliance.--To the extent that 
                medical care under a group health plan consists of 
                group health insurance coverage, the plan is deemed to 
                have satisfied the certification requirement under this 
                paragraph if the health insurance issuer offering the 
                coverage provides for such certification in accordance 
                with this paragraph.
            ``(2) Disclosure of information on previous benefits.--In 
        the case of an election described in subsection (c)(3)(B) by a 
        group health plan or health insurance issuer, if the plan or 
        issuer enrolls an individual for coverage under the plan and 
        the individual provides a certification of coverage of the 
        individual under paragraph (1)--
                    ``(A) upon request of such plan or issuer, the 
                entity which issued the certification provided by the 
                individual shall promptly disclose to such requesting 
                plan or issuer information on coverage of classes and 
                categories of health benefits available under such 
                entity's plan or coverage; and
                    ``(B) such entity may charge the requesting plan or 
                issuer for the reasonable cost of disclosing such 
                information.
            ``(3) Regulations.--The Secretary shall establish rules to 
        prevent an entity's failure to provide information under 
        paragraph (1) or (2) with respect to previous coverage of an 
        individual from adversely affecting any subsequent coverage of 
        the individual under another group health plan or health 
        insurance coverage.
    ``(f) Special Enrollment Periods.--
            ``(1) Individuals losing other coverage.--A group health 
        plan, and a health insurance issuer offering group health 
        insurance coverage in connection with a group health plan, 
        shall permit an employee who is eligible, but not enrolled, for 
        coverage under the terms of the plan (or a dependent of such an 
        employee if the dependent is eligible, but not enrolled, for 
        coverage under such terms) to enroll for coverage under the 
        terms of the plan if each of the following conditions is met:
                    ``(A) The employee or dependent was covered under a 
                group health plan or had health insurance coverage at 
                the time coverage was previously offered to the 
                employee or dependent.
                    ``(B) The employee stated in writing at such time 
                that coverage under a group health plan or health 
                insurance coverage was the reason for declining 
                enrollment, but only if the plan sponsor or issuer (if 
                applicable) required such a statement at such time and 
                provided the employee with notice of such requirement 
                (and the consequences of such requirement) at such 
                time.
                    ``(C) The employee's or dependent's coverage 
                described in subparagraph (A)--
                            ``(i) was under a COBRA continuation 
                        provision and the coverage under such provision 
                        was exhausted; or
                            ``(ii) was not under such a provision and 
                        either the coverage was terminated as a result 
                        of loss of eligibility for the coverage 
                        (including as a result of legal separation, 
                        divorce, death, termination of employment, or 
                        reduction in the number of hours of employment) 
                        or employer contributions toward such coverage 
                        were terminated.
                    ``(D) Under the terms of the plan, the employee 
                requests such enrollment not later than 30 days after 
                the date of exhaustion of coverage described in 
                subparagraph (C)(i) or termination of coverage or 
                employer contribution described in subparagraph 
                (C)(ii).
            ``(2) For dependent beneficiaries.--
                    ``(A) In general.--If--
                            ``(i) a group health plan makes coverage 
                        available with respect to a dependent of an 
                        individual;
                            ``(ii) the individual is a participant 
                        under the plan (or has met any waiting period 
                        applicable to becoming a participant under the 
                        plan and is eligible to be enrolled under the 
                        plan but for a failure to enroll during a 
                        previous enrollment period); and
                            ``(iii) a person becomes such a dependent 
                        of the individual through marriage, birth, or 
                        adoption or placement for adoption,
                the group health plan shall provide for a dependent 
                special enrollment period described in subparagraph (B) 
                during which the person (or, if not otherwise enrolled, 
                the individual) may be enrolled under the plan as a 
                dependent of the individual, and in the case of the 
                birth or adoption of a child, the spouse of the 
                individual may be enrolled as a dependent of the 
                individual if such spouse is otherwise eligible for 
                coverage.
                    ``(B) Dependent special enrollment period.--A 
                dependent special enrollment period under this 
                subparagraph shall be a period of not less than 30 days 
                and shall begin on the later of--
                            ``(i) the date dependent coverage is made 
                        available; or
                            ``(ii) the date of the marriage, birth, or 
                        adoption or placement for adoption (as the case 
                        may be) described in subparagraph (A)(iii).
                    ``(C) No waiting period.--If an individual seeks to 
                enroll a dependent during the first 30 days of such a 
                dependent special enrollment period, the coverage of 
                the dependent shall become effective--
                            ``(i) in the case of marriage, not later 
                        than the first day of the first month beginning 
                        after the date the completed request for 
                        enrollment is received;
                            ``(ii) in the case of a dependent's birth, 
                        as of the date of such birth; or
                            ``(iii) in the case of a dependent's 
                        adoption or placement for adoption, the date of 
                        such adoption or placement for adoption.
            ``(3) Special rules for application in case of medicaid and 
        chip.--
                    ``(A) In general.--A group health plan, and a 
                health insurance issuer offering group health insurance 
                coverage in connection with a group health plan, shall 
                permit an employee who is eligible, but not enrolled, 
                for coverage under the terms of the plan (or a 
                dependent of such an employee if the dependent is 
                eligible, but not enrolled, for coverage under such 
                terms) to enroll for coverage under the terms of the 
                plan if either of the following conditions is met:
                            ``(i) Termination of medicaid or chip 
                        coverage.--The employee or dependent is covered 
                        under a Medicaid plan under title XIX of the 
                        Social Security Act or under a State child 
                        health plan under title XXI of such Act and 
                        coverage of the employee or dependent under 
                        such a plan is terminated as a result of loss 
                        of eligibility for such coverage and the 
                        employee requests coverage under the group 
                        health plan (or health insurance coverage) not 
                        later than 60 days after the date of 
                        termination of such coverage.
                            ``(ii) Eligibility for employment 
                        assistance under medicaid or chip.--The 
                        employee or dependent becomes eligible for 
                        assistance, with respect to coverage under the 
                        group health plan or health insurance coverage, 
                        under such Medicaid plan or State child health 
                        plan (including under any waiver or 
                        demonstration project conducted under or in 
                        relation to such a plan), if the employee 
                        requests coverage under the group health plan 
                        or health insurance coverage not later than 60 
                        days after the date the employee or dependent 
                        is determined to be eligible for such 
                        assistance.
                    ``(B) Coordination with medicaid and chip.--
                            ``(i) Outreach to employees regarding 
                        availability of medicaid and chip coverage.--
                                    ``(I) In general.--Each employer 
                                that maintains a group health plan in a 
                                State that provides medical assistance 
                                under a State Medicaid plan under title 
                                XIX of the Social Security Act, or 
                                child health assistance under a State 
                                child health plan under title XXI of 
                                such Act, in the form of premium 
                                assistance for the purchase of coverage 
                                under a group health plan, shall 
                                provide to each employee a written 
                                notice informing the employee of 
                                potential opportunities then currently 
                                available in the State in which the 
                                employee resides for premium assistance 
                                under such plans for health coverage of 
                                the employee or the employee's 
                                dependents. For purposes of compliance 
                                with this subclause, the employer may 
                                use any State-specific model notice 
                                developed in accordance with section 
                                701(f)(3)(B)(i)(II) of the Employee 
                                Retirement Income Security Act of 1974 
                                (29 U.S.C. 1181(f)(3)(B)(i)(II)).
                                    ``(II) Option to provide concurrent 
                                with provision of plan materials to 
                                employee.--An employer may provide the 
                                model notice applicable to the State in 
                                which an employee resides concurrent 
                                with the furnishing of materials 
                                notifying the employee of health plan 
                                eligibility, concurrent with materials 
                                provided to the employee in connection 
                                with an open season or election process 
                                conducted under the plan, or concurrent 
                                with the furnishing of the summary plan 
                                description as provided in section 
                                104(b) of the Employee Retirement 
                                Income Security Act of 1974.
                            ``(ii) Disclosure about group health plan 
                        benefits to states for medicaid and chip 
                        eligible individuals.--In the case of an 
                        enrollee in a group health plan who is covered 
                        under a Medicaid plan of a State under title 
                        XIX of the Social Security Act or under a State 
                        child health plan under title XXI of such Act, 
                        the plan administrator of the group health plan 
                        shall disclose to the State, upon request, 
                        information about the benefits available under 
                        the group health plan in sufficient 
                        specificity, as determined under regulations of 
                        the Secretary of Health and Human Services in 
                        consultation with the Secretary that require 
                        use of the model coverage coordination 
                        disclosure form developed under section 
                        311(b)(1)(C) of the Children's Health Insurance 
                        Reauthorization Act of 2009, so as to permit 
                        the State to make a determination (under 
                        paragraph (2)(B), (3), or (10) of section 
                        2105(c) of the Social Security Act or 
                        otherwise) concerning the cost-effectiveness of 
                        the State providing medical or child health 
                        assistance through premium assistance for the 
                        purchase of coverage under such group health 
                        plan and in order for the State to provide 
                        supplemental benefits required under paragraph 
                        (10)(E) of such section or other authority.
    ``(g) Use of Affiliation Period by HMOs as Alternative to 
Preexisting Condition Exclusion.--
            ``(1) In general.--A health maintenance organization which 
        offers health insurance coverage in connection with a group 
        health plan and which does not impose any preexisting condition 
        exclusion allowed under subsection (a) with respect to any 
        particular coverage option may impose an affiliation period for 
        such coverage option, but only if--
                    ``(A) such period is applied uniformly without 
                regard to any health status-related factors; and
                    ``(B) such period does not exceed 2 months (or 3 
                months in the case of a late enrollee).
            ``(2) Affiliation period.--
                    ``(A) Defined.--For purposes of this title, the 
                term `affiliation period' means a period which, under 
                the terms of the health insurance coverage offered by 
                the health maintenance organization, must expire before 
                the health insurance coverage becomes effective. The 
                organization is not required to provide health care 
                services or benefits during such period and no premium 
                shall be charged to the participant or beneficiary for 
                any coverage during the period.
                    ``(B) Beginning.--Such period shall begin on the 
                enrollment date.
                    ``(C) Runs concurrently with waiting periods.--An 
                affiliation period under a plan shall run concurrently 
                with any waiting period under the plan.
            ``(3) Alternative methods.--A health maintenance 
        organization described in paragraph (1) may use alternative 
        methods, from those described in such paragraph, to address 
        adverse selection as approved by the State insurance 
        commissioner or official or officials designated by the State 
        to enforce the requirements of this part for the State involved 
        with respect to such issuer.

``SEC. 199A. 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. 199B. ANNUAL LIMITATION ON COST-SHARING.

    ``(a) In General.--
            ``(1) 2014.--The cost-sharing incurred under a group health 
        plan or group or individual health insurance coverage 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.
            ``(2) 2015 and later.--In the case of any plan year 
        beginning in a calendar year after 2014, the limitation under 
        this paragraph shall--
                    ``(A) in the case of self-only coverage, be equal 
                to the dollar amount under paragraph (1) 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 subsection (c) for 
                the calendar year; and
                    ``(B) in the case of other coverage, twice the 
                amount in effect under subparagraph (A).
        If the amount of any increase under subparagraph (A) is not a 
        multiple of $50, such increase shall be rounded to the next 
        lowest multiple of $50.
    ``(b) Cost-Sharing.--In this section:
            ``(1) In general.--The term `cost-sharing' includes--
                    ``(A) deductibles, coinsurance, copayments, or 
                similar charges; and
                    ``(B) 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 
                Revenue Code of 1986) with respect to essential health 
                benefits covered under the plan.
            ``(2) Exceptions.--Such term does not include premiums, 
        balance billing amounts for non-network providers, or spending 
        for non-covered services.
    ``(c) Premium Adjustment Percentage.--For purposes of subsection 
(a)(2)(A), 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).

``SEC. 199C. ENFORCEMENT OF CERTAIN HEALTH INSURANCE REQUIREMENTS.

    ``(a) State Enforcement.--
            ``(1) State authority.--Each State may require that health 
        insurance issuers that issue, sell, renew, or offer health 
        insurance coverage in the State in the individual or group 
        market meet the requirements of this part with respect to such 
        issuers.
            ``(2) Failure to implement provisions.--In the case of a 
        determination by the Secretary that a State has failed to 
        substantially enforce a provision (or provisions) of sections 
        196 through 199A with respect to health insurance issuers in 
        the State, the Secretary shall enforce such provision (or 
        provisions) under subsection (b) insofar as they relate to the 
        issuance, sale, renewal, and offering of health insurance 
        coverage in connection with group health plans or individual 
        health insurance coverage in such State.
    ``(b) Secretarial Enforcement Authority.--
            ``(1) Limitation.--The provisions of this subsection shall 
        apply to enforcement of a provision (or provisions) described 
        in subsection (a)(2) only--
                    ``(A) as provided under such subsection; and
                    ``(B) with respect to individual health insurance 
                coverage or group health plans that are non-Federal 
                governmental plans.
            ``(2) Imposition of penalties.--In the cases described in 
        paragraph (1)--
                    ``(A) In general.--Subject to the succeeding 
                provisions of this subsection, any non-Federal 
                governmental plan that is a group health plan and any 
                health insurance issuer that fails to meet a provision 
                of this part applicable to such plan or issuer is 
                subject to a civil money penalty under this subsection.
                    ``(B) Liability for penalty.--In the case of a 
                failure by--
                            ``(i) a health insurance issuer, the issuer 
                        is liable for such penalty; or
                            ``(ii) a group health plan that is a non-
                        Federal governmental plan which is--
                                    ``(I) sponsored by 2 or more 
                                employers, the plan is liable for such 
                                penalty; or
                                    ``(II) not so sponsored, the 
                                employer is liable for such penalty.
                    ``(C) Amount of penalty.--
                            ``(i) In general.--The maximum amount of 
                        penalty imposed under this paragraph is $100 
                        for each day for each individual with respect 
                        to which such a failure occurs.
                            ``(ii) Considerations in imposition.--In 
                        determining the amount of any penalty to be 
                        assessed under this paragraph, the Secretary 
                        shall take into account the previous record of 
                        compliance of the entity being assessed with 
                        the applicable provisions of this part and the 
                        gravity of the violation.
                            ``(iii) Limitations.--
                                    ``(I) Penalty not to apply where 
                                failure not discovered exercising 
                                reasonable diligence.--No civil money 
                                penalty shall be imposed under this 
                                paragraph on any failure during any 
                                period for which it is established to 
                                the satisfaction of the Secretary that 
                                none of the entities against whom the 
                                penalty would be imposed knew, or 
                                exercising reasonable diligence would 
                                have known, that such failure existed.
                                    ``(II) Penalty not to apply to 
                                failures corrected within 30 days.--No 
                                civil money penalty shall be imposed 
                                under this paragraph on any failure if 
                                such failure was due to reasonable 
                                cause and not to willful neglect, and 
                                such failure is corrected during the 
                                30-day period beginning on the first 
                                day any of the entities against whom 
                                the penalty would be imposed knew, or 
                                exercising reasonable diligence would 
                                have known, that such failure existed.
                    ``(D) Administrative review.--
                            ``(i) Opportunity for hearing.--The entity 
                        assessed shall be afforded an opportunity for 
                        hearing by the Secretary upon request made 
                        within 30 days after the date of the issuance 
                        of a notice of assessment. In such hearing the 
                        decision shall be made on the record pursuant 
                        to section 554 of title 5, United States Code. 
                        If no hearing is requested, the assessment 
                        shall constitute a final and unappealable 
                        order.
                            ``(ii) Hearing procedure.--If a hearing is 
                        requested, the initial agency decision shall be 
                        made by an administrative law judge, and such 
                        decision shall become the final order unless 
                        the Secretary modifies or vacates the decision. 
                        Notice of intent to modify or vacate the 
                        decision of the administrative law judge shall 
                        be issued to the parties within 30 days after 
                        the date of the decision of the judge. A final 
                        order which takes effect under this paragraph 
                        shall be subject to review only as provided 
                        under subparagraph (E).
                    ``(E) Judicial review.--
                            ``(i) Filing of action for review.--Any 
                        entity against whom an order imposing a civil 
                        money penalty has been entered after an agency 
                        hearing under this paragraph may obtain review 
                        by the United States district court for any 
                        district in which such entity is located or the 
                        United States District Court for the District 
                        of Columbia by filing a notice of appeal in 
                        such court within 30 days from the date of such 
                        order, and simultaneously sending a copy of 
                        such notice by registered mail to the 
                        Secretary.
                            ``(ii) Certification of administrative 
                        record.--The Secretary shall promptly certify 
                        and file in such court the record upon which 
                        the penalty was imposed.
                            ``(iii) Standard for review.--The findings 
                        of the Secretary shall be set aside only if 
                        found to be unsupported by substantial evidence 
                        as provided by section 706(2)(E) of title 5, 
                        United States Code.
                            ``(iv) Appeal.--Any final decision, order, 
                        or judgment of the district court concerning 
                        such review shall be subject to appeal as 
                        provided in chapter 83 of title 28 of such 
                        Code.
                    ``(F) Failure to pay assessment; maintenance of 
                action.--
                            ``(i) Failure to pay assessment.--If any 
                        entity fails to pay an assessment after it has 
                        become a final and unappealable order, or after 
                        the court has entered final judgment in favor 
                        of the Secretary, the Secretary shall refer the 
                        matter to the Attorney General who shall 
                        recover the amount assessed by action in the 
                        appropriate United States district court.
                            ``(ii) Nonreviewability.--In such action 
                        the validity and appropriateness of the final 
                        order imposing the penalty shall not be subject 
                        to review.
                    ``(G) Payment of penalties.--Except as otherwise 
                provided, penalties collected under this paragraph 
                shall be paid to the Secretary (or other officer) 
                imposing the penalty and shall be available without 
                appropriation and until expended for the purpose of 
                enforcing the provisions with respect to which the 
                penalty was imposed.
            ``(3) Enforcement authority relating to genetic 
        discrimination.--
                    ``(A) General rule.--In the cases described in 
                paragraph (1), notwithstanding the provisions of 
                paragraph (2)(C), the succeeding subparagraphs of this 
                paragraph shall apply with respect to an action under 
                this subsection by the Secretary with respect to any 
                failure of a health insurance issuer in connection with 
                a group health plan, to meet the requirements of 
                subsection (a)(1)(F), (b)(3), (c), or (d) of section 
                196 or section 197 or 196(b)(1) with respect to genetic 
                information in connection with the plan.
                    ``(B) Amount.--
                            ``(i) In general.--The amount of the 
                        penalty imposed under this paragraph shall be 
                        $100 for each day in the noncompliance period 
                        with respect to each participant or beneficiary 
                        to whom such failure relates.
                            ``(ii) Noncompliance period.--For purposes 
                        of this paragraph, the term `noncompliance 
                        period' means, with respect to any failure, the 
                        period--
                                    ``(I) beginning on the date such 
                                failure first occurs; and
                                    ``(II) ending on the date the 
                                failure is corrected.
                    ``(C) Minimum penalties where failure discovered.--
                Notwithstanding clauses (i) and (ii) of subparagraph 
                (D):
                            ``(i) In general.--In the case of 1 or more 
                        failures with respect to an individual--
                                    ``(I) which are not corrected 
                                before the date on which the plan 
                                receives a notice from the Secretary of 
                                such violation; and
                                    ``(II) which occurred or continued 
                                during the period involved,
                        the amount of penalty imposed by subparagraph 
                        (A) by reason of such failures with respect to 
                        such individual shall not be less than $2,500.
                            ``(ii) Higher minimum penalty where 
                        violations are more than de minimis.--To the 
                        extent violations for which any person is 
                        liable under this paragraph for any year are 
                        more than de minimis, clause (i) shall be 
                        applied by substituting `$15,000' for `$2,500' 
                        with respect to such person.
                    ``(D) Limitations.--
                            ``(i) Penalty not to apply where failure 
                        not discovered exercising reasonable 
                        diligence.--No penalty shall be imposed by 
                        subparagraph (A) on any failure during any 
                        period for which it is established to the 
                        satisfaction of the Secretary that the person 
                        otherwise liable for such penalty did not know, 
                        and exercising reasonable diligence would not 
                        have known, that such failure existed.
                            ``(ii) Penalty not to apply to failures 
                        corrected within certain periods.--No penalty 
                        shall be imposed by subparagraph (A) on any 
                        failure if--
                                    ``(I) such failure was due to 
                                reasonable cause and not to willful 
                                neglect; and
                                    ``(II) such failure is corrected 
                                during the 30-day period beginning on 
                                the first date the person otherwise 
                                liable for such penalty knew, or 
                                exercising reasonable diligence would 
                                have known, that such failure existed.
                            ``(iii) Overall limitation for 
                        unintentional failures.--In the case of 
                        failures which are due to reasonable cause and 
                        not to willful neglect, the penalty imposed by 
                        subparagraph (A) for failures shall not exceed 
                        the amount equal to the lesser of--
                                    ``(I) 10 percent of the aggregate 
                                amount paid or incurred by the employer 
                                (or predecessor employer) during the 
                                preceding taxable year for group health 
                                plans; or
                                    ``(II) $500,000.
                    ``(E) Waiver by secretary.--In the case of a 
                failure which is due to reasonable cause and not to 
                willful neglect, the Secretary may waive part or all of 
                the penalty imposed by subparagraph (A) to the extent 
                that the payment of such penalty would be excessive 
                relative to the failure involved.
    ``(c) Definitions.--For purposes of this section:
            ``(1) Governmental plan.--The term `governmental plan' has 
        the meaning given such term under section 3(32) of the Employee 
        Retirement Income Security Act of 1974 and any Federal 
        governmental plan.
            ``(2) Federal governmental plan.--The term ``Federal 
        governmental plan'' means a governmental plan established or 
        maintained for its employees by the Government of the United 
        States or by any agency or instrumentality of such Government.
            ``(3) Non-federal governmental plan.--The term `non-Federal 
        governmental plan' means a governmental plan that is not a 
        Federal governmental plan.''.
    (b) Conforming Amendment.--The table of contents under section 1(b) 
of the Health Insurance Portability and Accountability Act of 1996 
(Public Law 104-191) is amended by inserting after the item relating to 
section 195 the following:

``Sec. 196. Guaranteed availability of coverage.
``Sec. 197. Fair health insurance premiums.
``Sec. 198. Prohibiting discrimination against individual participants 
                            and beneficiaries based on health status.
``Sec. 199. Prohibition of preexisting condition exclusions or other 
                            discrimination based on health status.
``Sec. 199A. Extension of dependent coverage.
``Sec. 199B. Annual limitation on cost-sharing.
``Sec. 199C. Enforcement of certain health insurance requirements.''.
    (c) ERISA and IRC Enforcement.--
            (1) ERISA.--Subpart B of part 7 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. 716. OTHER MARKET REFORMS.

    ``Sections 196 and 197 of the Health Insurance Portability and 
Accountability Act of 1996 shall apply to health insurance issuers 
providing health insurance coverage in connection with group health 
plans, and sections 198 through 199B of such Act shall apply to group 
health plans and health insurance issuers providing health insurance 
coverage in connection with group health plans, as if included in this 
subpart, and to the extent that any provision of this part conflicts 
with a provision of such section 196 or 197 with respect to health 
insurance issuers providing health insurance coverage in connection 
with group health plans or of such section 198, 199, 199A, or 199B with 
respect to group health plans or health insurance issuers providing 
health insurance coverage in connection with group health plans, the 
provisions of such sections 196 through 199B shall apply.''.
            (2) IRC.--Subchapter B of chapter 100 of subtitle K of 
        title 26 of the Internal Revenue Code of 1986 is amended by 
        adding at the end the following new section:

``SEC. 9816. OTHER MARKET REFORMS.

    ``Sections 196 and 197 of the Health Insurance Portability and 
Accountability Act of 1996 shall apply to health insurance issuers 
providing health insurance coverage in connection with group health 
plans, and sections 198 through 199B of such Act shall apply to group 
health plans and health insurance issuers providing health insurance 
coverage in connection with group health plans, as if included in this 
subchapter, and to the extent that any provision of this chapter 
conflicts with a provision of such section 196 or 197 with respect to 
health insurance issuers providing health insurance coverage in 
connection with group health plans or of such section 198, 199, 199A, 
or 199B with respect to group health plans or health insurance issuers 
providing health insurance coverage in connection with group health 
plans, the provisions of such sections 196 through 199B shall apply.''.
    (d) Effective Date.--The amendments made by this section shall take 
effect on the date on which the Supreme Court of the United States 
issues a decision striking down the Patient Protection and Affordable 
Care Act (Public Law 111-148) in its entirety.

                 Subtitle B--Expanding Coverage Options

SEC. 211. DEFINITION OF ``EMPLOYER'' UNDER ERISA WITH RESPECT TO GROUP 
              HEALTH PLANS.

    (a) Definition of Employer.--Section 3(5) of the Employee 
Retirement Income Security Act of 1974 (29 U.S.C. 1002(5)) is amended 
by striking the period and inserting ``(which, with respect to a group 
health plan, shall be determined in accordance with criteria that 
includes the criteria under section 735).''.
    (b) Group Health Plans.--Part 7 of subtitle B of title I of the 
Employee Retirement Income Security Act of 1974 (29 U.S.C. 1181 et 
seq.) is amended by adding at the end the following:

``SEC. 735. DEFINITION OF `EMPLOYER' WITH RESPECT TO GROUP HEALTH 
              PLANS.

    ``(a) In General.--A group or association of employers that meets 
the criteria under subsection (b) shall be considered an employer under 
section 3(5) for purposes of sponsoring a group health plan.
    ``(b) Requirements.--The requirements under this subsection are 
each of the following:
            ``(1) The primary purpose of the group or association may 
        be to offer and provide health coverage to its employer members 
        and their employees, if such group or association has at least 
        1 substantial business purpose, as described in subsection (c), 
        unrelated to offering and providing health coverage or other 
        employee benefits to its employer members and their employees.
            ``(2) Each employer member of the group or association 
        participating in the group health plan is a person acting 
        directly as an employer of at least 1 employee who is a 
        participant covered under the plan.
            ``(3) The group or association has--
                    ``(A) a formal organizational structure with a 
                governing body; and
                    ``(B) by-laws or other similar indications of 
                formality.
            ``(4) The functions and activities of the group or 
        association shall be controlled by the employer members of the 
        group or association, and the employer members of the group or 
        association that participate in the group health plan shall 
        control the plan. Control under this paragraph shall be in form 
        and substance.
            ``(5) The employer members shall have a commonality of 
        interest as described in subsection (d).
            ``(6)(A) The group or association shall not make health 
        coverage through the group health plan available other than 
        to--
                    ``(i) an employee of a current employer member of 
                the group or association;
                    ``(ii) a former employee of a current employer 
                member of the group or association who became eligible 
                for coverage under the group health plan when the 
                former employee was an employee of the employer; and
                    ``(iii) a beneficiary of an individual described in 
                clause (i) or (ii), such as a spouse or dependent 
                child.
            ``(B) Notwithstanding subparagraph (A), the group or 
        association shall not make health coverage through the group 
        health plan available to any individual (or beneficiaries of 
        the individual) for any plan year following the plan year in 
        which the plan determines pursuant to reasonable monitoring 
        procedures described in subsection (f)(2)(C) that the 
        individual ceases to meet the conditions described in 
        subsection (f)(2) for being a working owner (unless the 
        individual again meets those conditions), except as may be 
        required by section 601.
            ``(7) The group or association, and any health coverage 
        offered by the group or association, shall comply with the 
        nondiscrimination provisions under subsection (e).
            ``(8) The group or association shall not be a health 
        insurance issuer, or owned or controlled by such a health 
        insurance issuer or by a subsidiary or affiliate of such a 
        health insurance issuer, other than to the extent such entities 
        participate in the group or association in their capacity as 
        employer members of the group or association.
    ``(c) Substantial Business Purpose.--
            ``(1) In general.--For purposes of subsection (b)(1), a 
        substantial business purpose shall exist if the group or 
        association would be a viable entity in the absence of 
        sponsoring an employee benefit plan.
            ``(2) Business purpose.--For purposes of subsection (b)(1) 
        and paragraph (1), a business purpose shall--
                    ``(A) include promoting common business interests 
                of the members of the group or association or the 
                common economic interests in a given trade or employer 
                community; and
                    ``(B) not be required to be a for-profit activity.
    ``(d) Commonality of Interest.--
            ``(1) In general.--Subject to paragraph (3), employer 
        members of the group or association shall be treated as having 
        a commonality of interest for purposes of subsection (b)(5) 
        if--
                    ``(A) the employers are in the same trade, 
                industry, line of business, or profession; or
                    ``(B) each employer has a principal place of 
                business in the same region that does not exceed the 
                boundaries of a single State or a metropolitan area 
                (even if the metropolitan area includes more than 1 
                State).
            ``(2) Same trade, industry, or line of business.--In the 
        case of a group or association that is sponsoring a group 
        health plan under this section and that is itself an employer 
        member of the group or association, the group or association 
        shall be deemed for purposes of paragraph (1)(A) to be in the 
        same trade, industry, line of business, or profession, as 
        applicable, as the other employer members of the group or 
        association.
            ``(3) Nondiscrimination.--The standards under paragraph (1) 
        shall not be implemented in a manner that is subterfuge for 
        discrimination as is prohibited under subsection (e).
    ``(e) Nondiscrimination.--
            ``(1) In general.--A group or association of employers 
        sponsoring a group health plan under this section, and any 
        health coverage sponsored by such group or association, shall 
        comply with each of the following:
                    ``(A) The group or association shall not condition 
                employer membership in the group or association on any 
                health factor of any individual who is or may become 
                eligible to participate in the group health plan 
                sponsored by the group or association.
                    ``(B) The group health plan sponsored by the group 
                or association shall comply with the rules under 
                section 2590.702(b) of title 29, Code of Federal 
                Regulations (as in effect on June 21, 2018), with 
                respect to nondiscrimination in rules for eligibility 
                for benefits, subject to subparagraph (D).
                    ``(C) The group health plan sponsored by the group 
                or association shall comply with the rules under 
                section 2590.702(c) of title 29, Code of Federal 
                Regulations (as in effect on June 21, 2018), with 
                respect to nondiscrimination in premiums or 
                contributions required by any participant or 
                beneficiary for coverage under the plan, subject to 
                subparagraph (D).
                    ``(D) In applying subparagraphs (B) and (C), the 
                group or association may not treat the employees of 
                different employer members of the group or association 
                as distinct groups of similarly-situated individuals 
                based on a health factor of 1 or more individuals.
            ``(2) Definition of health factor.--For purposes of this 
        subsection, the term `health factor' has the meaning given such 
        term in section 2590.702(a) of title 29, Code of Federal 
        Regulations (as in effect on June 21, 2018).
    ``(f) Dual Treatment of Working Owners as Employers and 
Employees.--
            ``(1) In general.--A person determined in accordance with 
        paragraph (2) to be a working owner of a trade or business may 
        qualify as both an employer and as an employee of the trade or 
        business for purposes of the requirements under subsection (b), 
        including the requirements under paragraphs (2) and (6) of such 
        subsection.
            ``(2) Working owner.--
                    ``(A) Eligibility.--A person shall qualify as a 
                `working owner' if a responsible fiduciary of the group 
                health plan reasonably determines that the person--
                            ``(i) does not have any common law 
                        employees;
                            ``(ii) has an ownership right of any nature 
                        in a trade or business, whether incorporated or 
                        unincorporated, including a partner and other 
                        self-employed individual;
                            ``(iii) is earning wages or self-employment 
                        income from the trade or business for providing 
                        personal services to the trade or business; and
                            ``(iv) either--
                                    ``(I) works on average at least 20 
                                hours per week, or at least 80 hours 
                                per month, providing personal services 
                                to the person's trade or business; or
                                    ``(II) has wages or self-employment 
                                income from such trade or business that 
                                at least equals the person's cost of 
                                coverage for participation by the 
                                person, and any covered beneficiaries, 
                                in the group health plan sponsored by 
                                the group or association in which the 
                                person is participating.
                    ``(B) Determination.--The determination under 
                subparagraph (A) shall be made when the person first 
                becomes eligible for coverage under the group health 
                plan.
                    ``(C) Reasonable monitoring procedures.--A 
                responsible fiduciary of the group health plan shall, 
                through reasonable monitoring procedures, periodically 
                confirm the continued eligibility of a person to 
                qualify as a working owner under subparagraph (A) for 
                purposes of meeting the requirements under subsection 
                (b) for the group health plan sponsored under this 
                section.
    ``(g) Applicability.--
            ``(1) Fully insured.--This section shall apply beginning on 
        September 1, 2018, with respect to a group or association of 
        employers sponsoring a group health plan that is fully insured.
            ``(2) Plans expanding to include broader group.--This 
        section shall apply beginning on January 1, 2019, with respect 
        to a group or association of employers sponsoring a group 
        health plan that--
                    ``(A) is not fully insured;
                    ``(B) is in existence on June 21, 2018;
                    ``(C) meets the requirements that applied with 
                respect to such plan before June 21, 2018; and
                    ``(D) chooses to be a plan sponsored under this 
                section (and subject to the requirements under 
                subsections (b) through (f)).
            ``(3) Other association health plans.--This section shall 
        apply beginning on April 1, 2019, with respect to any other 
        group or association of employers sponsoring a group health 
        plan.
            ``(4) Other criteria in advisory opinions.--The criteria 
        under this section shall not invalidate any criteria provided 
        in an advisory opinion, in effect on or after the date of 
        enactment of the Fair Care Act of 2022, that the Secretary may 
        use to determine if a group or association of employers is an 
        employer under section 3(5) for purposes of sponsoring a group 
        health plan.
    ``(h) Determination of Employer or Joint Employer Status.--
            ``(1) In general.--Participating in or facilitating a group 
        health plan sponsored by a bona fide group or association of 
        employers pursuant to subsection (a) shall not be construed as 
        establishing an employer or joint employer relationship under 
        any Federal or State law.
            ``(2) Application of provision.--Paragraph (1) shall apply 
        to a group health plan sponsored or facilitated by a franchisor 
        and any franchisee, by multiple franchisors for the benefit of 
        the employees of such franchisors and their franchisees, by 
        multiple franchisees for the benefit of the employees of such 
        franchisees, by a franchisor whose franchisee or franchisees 
        participate or participates in the plan, or by a person or 
        entity that contracts with any individual as an independent 
        contractor for whom the plan benefits.
    ``(i) Rule of Construction.--Nothing in this section shall be 
construed as repealing or otherwise limiting the application of this 
Act (including section 712 relating to mental health parity) to group 
health plans and employee welfare benefit plans.''.

SEC. 212. SHORT-TERM LIMITED DURATION INSURANCE.

    (a) Definition.--Section 2791(b) of the Public Health Service Act 
(42 U.S.C. 300gg-91(b)) is amended by adding at the end the following:
            ``(6) Short-term limited duration insurance.--The term 
        `short-term limited duration insurance' means health insurance 
        coverage provided pursuant to a contract with a health 
        insurance issuer that has an expiration date specified in the 
        contract (not taking into account any extensions that may be 
        elected by the policyholder with or without the issuer's 
        consent) that is less than 12 months after the original 
        effective date of the contract.''.
    (b) Guaranteed Renewability.--Section 2703 of the Public Health 
Service Act (42 U.S.C. 300gg-2) is amended--
            (1) in subsection (a), by inserting ``or offers short-term 
        limited duration insurance'' after ``group market''; and
            (2) by adding at the end the following:
    ``(f) Application to Short-Term Limited Duration Insurance.--
            ``(1) In general.--In applying this section in the case of 
        short-term limited duration insurance--
                    ``(A) a reference to `health insurance coverage' 
                with respect to such coverage offered in the individual 
                market shall be deemed to include short-term limited 
                duration insurance; and
                    ``(B) a reference to `health insurance issuer' with 
                respect to health insurance coverage offered in the 
                individual market shall be deemed to include an issuer 
                of short-term limited duration insurance.
            ``(2) Special rule for short-term limited duration 
        insurance.--In the case of short-term limited duration 
        insurance, at the time of application for enrollment in such 
        insurance coverage, an issuer of such insurance may offer 
        renewability of such coverage, and an individual may decline 
        renewability of such coverage in accordance with this section, 
        and the contract between such individual and the health 
        insurance issuer shall specify whether the individual opted for 
        renewability or no renewability.''.
    (c) Applicability.--The amendments made by subsections (a) and (b) 
shall apply with respect to contracts for short-term limited duration 
insurance that take effect on or after January 1, 2023.

           Subtitle C--Improving Commercial Health Insurance

SEC. 221. INVISIBLE GUARANTEED COVERAGE POOL REINSURANCE PROGRAM; TAX 
              ON EXCHANGE PLANS.

    (a) Establishment.--Not later than 2 years after the date of 
enactment of this Act, the Secretary of Health and Human Services shall 
establish the Invisible Guaranteed Coverage Pool Reinsurance Program 
(in this section referred to as the ``IGCPR program'').
    (b) State Grants.--Under the IGCPR program, the Secretary shall, 
from amounts appropriated under subsection (f) for a fiscal year, award 
grants to States for such fiscal year, in amounts determined in 
accordance with the allocation methodology specified under subsection 
(d). Such grants shall be used for the purpose of establishing or 
maintaining a qualifying Invisible Guaranteed Coverage Pool for the 
State.
    (c) Federal Default.--
            (1) In general.--In the case of a State that does not, by a 
        date and in a manner specified by the Secretary, choose to be 
        awarded a grant under subsection (b) for a fiscal year to 
        operate a qualifying Invisible Guaranteed Coverage Pool for the 
        State, the Secretary shall, from amounts appropriated under 
        subsection (f) for such fiscal year, use the allocation 
        determined for the State under subsection (d) for participation 
        of such State in the Federal default qualifying Invisible 
        Guaranteed Coverage Pool described in paragraph (2).
            (2) Federal default qualifying invisible guaranteed 
        coverage pool.--The Federal default qualifying high risk pool 
        is, with respect to each State that chooses not to be awarded a 
        grant under subsection (b) with respect to a fiscal year for 
        which funds are appropriated under subsection (f), an Invisible 
        Guaranteed Coverage Pool under which health insurance issuers 
        participating in the Exchange of such a State, with respect to 
        designated individuals who are enrolled in health insurance 
        coverage and are expected to experience higher than average 
        health costs as determined by the insurer, cede risk to the 
        pool, without affecting the premium paid by the designated 
        individuals or their terms of coverage. With respect to such 
        pool--
                    (A) high-risk individuals designated for cession to 
                the pool shall be designated by the ceding issuer;
                    (B) the premium amount the ceding issuer shall pay 
                to the reinsurance pool shall be 90 percent of the 
                premium paid to the issuer for the coverage;
                    (C) the ceding issuer shall retain the same risk 
                under the ceded policies as under any other policy of 
                the issuer with respect to the first $10,000 of 
                benefits for each ceded policy involved and will not 
                retain any risk under ceded policies after such first 
                $10,000 of benefits; and
                    (D) after a ceding issuer, with respect to a ceded 
                policy, no longer retains risk under such policy 
                pursuant to subparagraph (C), the negotiated rate under 
                such policy for items and services shall be payable at 
                the reimbursement rate under the Medicare program under 
                title XVIII of the Social Security Act for such items 
                and services, or in the case of items and services for 
                which payment is available under the policy but not the 
                Medicare program, at a rate determined by the 
                Secretary.
    (d) Allocation Methodology.--Not later than six months after the 
establishment of the IGCPR program, the Secretary shall specify an 
allocation methodology for determining the amount of funds appropriated 
under subsection (f) for a fiscal year to be allocated for each State 
for purposes of subsections (b) and (c). Such methodology shall be 
based on the number of residents of each State and the general health 
status of such residents.
    (e) Qualifying Invisible Guaranteed Coverage Pool.--For purposes of 
this section, the term ``qualifying Invisible Guaranteed Coverage 
Pool'' means, with respect to a State, a method of designation under 
which health insurance issuers identify individuals who experience 
higher than average health costs as determined by the State and are 
enrolled in health insurance coverage offered in the individual market, 
and cede the risk of spending more than $10,000 on health care services 
for a single individual to the pool without affecting the premium paid 
by the designated individuals or their terms of coverage. With respect 
to such pool, the State, or an entity operating the pool on behalf of 
the State, shall establish--
            (1) the premium amount the ceding issuer shall pay to the 
        reinsurance pool;
            (2) the applicable attachment points or coinsurance 
        percentages if the ceding issuer retains any portion of the 
        risk under ceded policies, except that the provisions of 
        subparagraphs (C) and (D) of subsection (c)(2) shall apply to 
        such high risk pool in the same manner as such clauses apply to 
        the Federal default high risk pool; and
            (3) the mechanism by which high-risk individuals are 
        designated for cession to the pool, which may include a list of 
        designated high-cost health conditions.
    (f) Appropriations.--There is appropriated to the Secretary of 
Health and Human Services $200,000,000,000 to carry out this section 
for the period of the first 10 years after the establishment of the 
IGCPR program.
    (g) Tax on Health Insurance Plans Sold on Exchanges.--
            (1) In general.--Chapter 34 of the Internal Revenue Code of 
        1986 is amended by adding at the end the following new 
        subchapter:

   ``Subchapter C--Additional Tax on Health Insurance Plans Sold by 
                  Insurers Offering Plans on Exchanges

``Sec. 4401. Additional tax on health insurance plans sold by insurers 
                            offering plans on exchanges.

``SEC. 4401. ADDITIONAL TAX ON HEALTH INSURANCE PLANS SOLD BY INSURERS 
              OFFERING PLANS ON EXCHANGES.

    ``(a) Imposition of Tax.--There is imposed a tax of $4 for each 
policy month of each health insurance policy sold by insurers offering 
plans through an Exchange established under the Patient Protection and 
Affordable Care Act.
    ``(b) Liability.--The tax imposed by subsection (a) shall be paid 
by the plan sponsor.''.
            (2) Conforming amendment.--The table of subchapters for 
        chapter 34 of the Internal Revenue Code of 1986 is amended by 
        adding at the end the following item:

   ``subchapter c--additional tax on health insurance plans sold by 
                insurers offering plans on exchanges''.

            (3) Effective date.--The amendments made by this subsection 
        shall apply with respect to months beginning after the date of 
        enactment of this Act.
    (h) Report.--The Secretary of Health and Human Services, in 
collaboration with the Comptroller General of the United States, shall 
submit to Congress, not later than 5 years after the date of enactment 
of this Act, and again 5 years thereafter, a report on the status of 
reinsurance pool funding, along with any recommendations with respect 
to future allocations or funding methods for such pool.

SEC. 222. EMPLOYER HEALTH INSURANCE MANDATE REPEAL.

    (a) In General.--Chapter 43 of the Internal Revenue Code of 1986 is 
amended by striking section 4980H.
    (b) Repeal of Related Reporting Requirements.--Subpart D of part 
III of subchapter A of chapter 61 of such Code is amended by striking 
section 6056.
    (c) Conforming Amendments.--
            (1) Section 6724(d)(1)(B) of such Code is amended by 
        inserting ``or'' at the end of clause (xxiii), by striking 
        ``or'' at the end of clause (xxiv), and by striking clause 
        (xxv).
            (2) Section 6724(d)(2) of such Code is amended by inserting 
        ``or'' at the end of subparagraph (GG) and by striking 
        subparagraph (HH).
            (3) The table of sections for chapter 43 of such Code is 
        amended by striking the item relating to section 4980H.
            (4) The table of sections for subpart D of part III of 
        subchapter A of chapter 61 of such Code is amended by striking 
        the item relating to section 6056.
            (5) Section 1513 of the Patient Protection and Affordable 
        Care Act is amended by striking subsection (c).
    (d) Effective Date.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section shall apply to 
        months and other periods beginning after December 31, 2023.
            (2) Repeal of study and report.--The amendment made by 
        subsection (c)(5) shall take effect on the date of the 
        enactment of this Act.

SEC. 223. REFUNDABLE CREDITS FOR COVERAGE UNDER A QUALIFIED HEALTH PLAN 
              FOR INDIVIDUALS OFFERED EMPLOYER-SPONSORED INSURANCE.

    (a) In General.--Section 36B(c)(2) of the Internal Revenue Code of 
1986 is amended--
            (1) in subparagraph (B)(i), by inserting ``or section 
        5000A(f)(1)(B)'', and
            (2) by striking subparagraph (C).
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 224. INCLUSION IN INCOME OF CERTAIN COSTS OF EMPLOYER-PROVIDED 
              COVERAGE UNDER HEALTH PLANS.

    (a) In General.--Section 106 of the Internal Revenue Code of 1986 
is amended by adding at the end the following new subsection:
    ``(h) Limitation.--
            ``(1) In general.--Subsection (a) shall not apply to the 
        extent that employer-provided coverage under health plans for 
        an employee for a taxable year exceeds--
                    ``(A) $10,200 for self-only coverage, and
                    ``(B) $27,500 for all other coverage.
            ``(2) In general.--In the case of any calendar year after 
        2023, the dollar amounts in paragraph (1) shall each be 
        increased by an amount equal to--
                    ``(A) such dollar amount, multiplied by--
                    ``(B) the cost-of-living adjustment determined 
                under section 1(f)(3) for such calendar year, 
                determined--
                            ``(i) by substituting `calendar year 2023' 
                        for `calendar year 2018' in subparagraph 
                        (A)(ii) thereof, and
                            ``(ii) by substituting for the C-CPI-U 
                        referred to in section 1(f)(3)(A) the amount 
                        that such CPI would have been if the annual 
                        percentage increase in CPI with respect to each 
                        year after 2023 and before 2033 had been one 
                        percentage point greater.
            ``(3) Terms related to cpi.--
                    ``(A) Annual percentage increase.--For purposes of 
                subparagraph (B)(ii)(II), the term `annual percentage 
                increase' means the percentage (if any) by which C-CPI-
                U for any year exceeds the C-CPI-U for the prior year.
                    ``(B) Other terms.--Terms used in this paragraph 
                which are also used in section 1(f)(3) shall have the 
                same meanings as when used in such section.''.
    (b) Effective Date.--The amendments made by this section shall 
apply with respect to taxable years beginning after December 31, 2023.

SEC. 225. CHANGE IN PERMISSIBLE AGE VARIATION IN HEALTH INSURANCE 
              PREMIUM RATES.

    Section 2701(a)(1)(A)(iii) of the Public Health Service Act (42 
U.S.C. 300gg(a)(1)(A)(iii)) is amended by inserting after ``(consistent 
with section 2707(c))'' the following: ``or, for plan years beginning 
on or after January 1, 2023, as the Secretary may implement through 
interim final regulation, 5 to 1 for adults (consistent with section 
2707(c))''.

SEC. 226. PREMIUM ASSISTANCE ADJUSTMENT TO REFLECT AGE.

    (a) Modification of Applicable Percentage.--Section 36B(b)(3)(A) of 
the Internal Revenue Code of 1986 is amended to read as follows:
                    ``(A) Applicable percentage.--
                            ``(i) In general.--The applicable 
                        percentage for any taxable year shall be the 
                        percentage such that the applicable percentage 
                        for any taxpayer whose household income is 
                        within an income tier specified in the 
                        following table shall increase, on a sliding 
                        scale in a linear manner, from the initial 
                        percentage to the final percentage specified in 
                        such table for such income tier with respect to 
                        a taxpayer of the age involved:


------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
  ``In the case of              Up to Age 29                         Age 30-39                          Age 40-49                         Age 50-59                        Over Age 59
  household income  ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
  (expressed as a
   percent of the
   poverty line)
     within the          Initial %          Final %          Initial %         Final %         Initial %         Final %         Initial %         Final %         Initial %         Final %
 following  income
       tier:
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Up to 100%           0...............  0...............  0...............  0..............  0..............  0..............  0..............  0..............  0..............  0
100%-133%            2...............  2...............  2...............  2..............  2..............  2..............  2..............  2..............  2..............  2
133%-150%            3...............  4.3.............  3...............  4.3............  3..............  4.3............  3..............  4.3............  3..............  4.3
150%-200%            4.3.............  6.7.............  4.3.............  6.7............  4.3............  6.7............  4.3............  6.7............  4.3............  6.7
200%-250%            6.7.............  6.7.............  6.7.............  7.6............  6.7............  8.3............  6.7............  8.3............  6.7............  8.3
250%-300%            6.7.............  6.7.............  7.6.............  7.6............  8.3............  9.8............  8.3............  9.8............  8.3............  9.8
300%-400%            6.7.............  7...............  7.6.............  8..............  9.8............  10.............  9.8............  10.............  9.8............  10
400%-600%            7...............  9...............  8...............  10.............  10.............  15.............  10.............  15.............  10.............  15
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                            ``(ii) Age determinations.--
                                    ``(I) In general.--For purposes of 
                                clause (i), the age of the taxpayer 
                                taken into account under clause (i) 
                                with respect to any taxable year is the 
                                age attained by such taxpayer before 
                                the close of such taxable year.
                                    ``(II) Joint returns.--In the case 
                                of a joint return, the age of the older 
                                spouse shall be taken into account 
                                under clause (i).
                            ``(iii) Indexing.--In the case of any 
                        taxable year beginning after calendar year 
                        2023, the initial and final percentages 
                        contained in clause (i) shall be adjusted to 
                        reflect--
                                    ``(I) the excess (if any) of the 
                                rate of premium growth for the period 
                                beginning with calendar year 2013 and 
                                ending with calendar year 2023, over 
                                the rate of income growth for such 
                                period, and
                                    ``(II) in addition to any 
                                adjustment under subclause (I), the 
                                excess (if any) of the rate of premium 
                                growth for calendar year 2023, over the 
                                rate of growth in the consumer price 
                                index for calendar year 2023.
                            ``(iv) Failsafe.--Clause (iii)(II) shall 
                        apply only if the aggregate amount of premium 
                        tax credits under this section and cost-sharing 
                        reductions under section 1402 of the Patient 
                        Protection and Affordable Care Act for the 
                        preceding calendar year exceeds an amount equal 
                        to 0.504 percent of the gross domestic product 
                        for such calendar year.''.
    (b) Expansion of Eligibility.--Section 36B of the Internal Revenue 
Code of 1986 is amended--
            (1) in subsection (c)(1)(A), by striking ``400'' and 
        inserting ``600''; and
            (2) in subsection (f)(2)(B)(i), by striking ``400'' each 
        place such reference appears and inserting ``600'' in each such 
        place.
    (c) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2023.

SEC. 227. PREMIUM ASSISTANCE.

    Notwithstanding any other provision of law, the Secretary of the 
Treasury shall calculate the credit allowable under section 36B of the 
Internal Revenue Code of 1986 based on the taxpayer's prior year tax 
return and the Secretary of Health and Human Services shall provide for 
open enrollment periods that end on April 15.

SEC. 228. ADDING COPPER PLANS TO EXCHANGES.

    (a) In General.--Section 1302 of the Patient Protection and 
Affordable Care Act (42 U.S.C. 18022) is amended--
            (1) in subsection (a)(3), by inserting ``copper,'' after 
        ``either the'';
            (2) in subsection (c), by adding at the end the following 
        new paragraph:
            ``(5) Special rule for copper plans.--A health plan in the 
        copper level of coverage (as described in subsection (d)(1)(E)) 
        shall be deemed to meet the requirements of this subsection.'';
            (3) in subsection (d)--
                    (A) in paragraph (1), by adding at the end the 
                following new subparagraph:
                    ``(E) Copper level.--A plan in the copper level 
                shall provide a level of coverage that is designed to 
                provide benefits that are actuarially equivalent to 50 
                percent of the full actuarial value of the benefits 
                provided under the plan and will have out-of-pocket 
                limits that are 30 percent higher than bronze plans.''; 
                and
                    (B) in paragraph (4)--
                            (i) by inserting ``copper,'' after ``any 
                        reference to a''; and
                            (ii) by inserting ``copper,'' after 
                        ``providing a''; and
            (4) in subsection (e)(1), by inserting ``copper,'' after 
        ``not providing a''.
    (b) Effective Date.--The amendments made by this section shall 
apply with respect to plan years beginning on or after January 1, 2023.

SEC. 229. COPPER AND BRONZE PLANS.

    Notwithstanding any other provision of law, refundable credits for 
coverage under a qualified health plan and cost-sharing reductions may 
be used to purchase bronze and copper plans.

SEC. 230. WAIVERS FOR STATE INNOVATION.

    (a) Streamlining the State Application Process.--Section 1332 of 
the Patient Protection and Affordable Care Act (42 U.S.C. 18052) is 
amended--
            (1) in subsection (a)(1)(C), by striking ``the law'' and 
        inserting ``a law or has in effect a certification''; and
            (2) in subsection (b)(2)--
                    (A) in the paragraph heading, by inserting ``or 
                certify'' after ``law'';
                    (B) in subparagraph (A)--
                            (i) by striking ``A law'' and inserting the 
                        following:
                            ``(i) Laws.--A law''; and
                            (ii) by adding at the end the following:
                            ``(ii) Certifications.--A certification 
                        described in this paragraph is a document, 
                        signed by the Governor of the State, that 
                        certifies that such Governor has the authority 
                        under existing Federal and State law to take 
                        action under this section, including 
                        implementation of the State plan under 
                        subsection (a)(1)(B).''; and
                    (C) in subparagraph (B)--
                            (i) in the subparagraph heading, by 
                        striking ``of opt out''; and
                            (ii) by striking ``may repeal a law'' and 
                        all that follows through the period at the end 
                        and inserting the following: ``may terminate 
                        the authority provided under the waiver with 
                        respect to the State by--
                            ``(i) repealing a law described in 
                        subparagraph (A)(i); or
                            ``(ii) terminating a certification 
                        described in subparagraph (A)(ii), through a 
                        certification for such termination signed by 
                        the Governor of the State.''.
    (b) Providing Expedited Approval of State Waivers.--Section 1332(d) 
of the Patient Protection and Affordable Care Act (42 U.S.C. 18052(d)) 
is amended--
            (1) in paragraph (1) by striking ``180'' and inserting 
        ``90''; and
            (2) by adding at the end the following:
            ``(3) Expedited determination.--
                    ``(A) In general.--With respect to any application 
                under subsection (a)(1) submitted on or after the date 
                of this paragraph or any such application submitted 
                prior to such date of enactment and under review by the 
                Secretary on such date of enactment, the Secretary 
                shall make a determination on such application, using 
                the criteria for approval otherwise applicable under 
                this section, not later than 45 days after the receipt 
                of such application, and shall allow the public notice 
                and comment at the State and Federal levels described 
                under subsection (a)(4) to occur concurrently if such 
                State application--
                            ``(i) is submitted in response to an urgent 
                        situation, with respect to areas in the State 
                        that the Secretary determines are at risk for 
                        excessive premium increases or having no health 
                        plans offered in the applicable health 
                        insurance market for the current or following 
                        plan year; or
                            ``(ii) is for a waiver that is the same or 
                        substantially similar to a waiver that the 
                        Secretary already has approved for another 
                        State.
                    ``(B) Approval.--
                            ``(i) Urgent situations.--
                                    ``(I) Provisional approval.--A 
                                waiver approved under the expedited 
                                determination process under 
                                subparagraph (A)(i) shall be in effect 
                                for a period of 3 years, unless the 
                                State requests a shorter duration.
                                    ``(II) Full approval.--Subject to 
                                the requirements for approval otherwise 
                                applicable under this section, not 
                                later than 1 year before the expiration 
                                of a provisional waiver period 
                                described in subclause (I) with respect 
                                to an application described in 
                                subparagraph (A)(i), the Secretary 
                                shall make a determination on whether 
                                to extend the approval of such waiver 
                                for the full term of the waiver 
                                requested by the State, for a total 
                                approval period not to exceed 6 years. 
                                The Secretary may request additional 
                                information as the Secretary determines 
                                appropriate to make such determination.
                            ``(ii) Approval of same or similar 
                        applications.--An approval of a waiver under 
                        subparagraph (A)(ii) shall be subject to the 
                        terms of subsection (e).
                    ``(C) GAO study.--Not later than 5 years after the 
                date of enactment of this paragraph, the Comptroller 
                General of the United States shall conduct a review of 
                all waivers approved pursuant to an application under 
                subparagraph (A)(ii) to evaluate whether such waivers 
                met the requirements of subsection (b)(1) and whether 
                the applications should have qualified for such 
                expedited process.''.
    (c) Providing Certainty for State-Based Reforms.--Section 1332(e) 
of the Patient Protection and Affordable Care Act (42 U.S.C. 18052(e)) 
is amended by striking ``No waiver'' and all that follows through the 
period at the end and inserting the following: ``A waiver under this 
section--
            ``(1) shall be in effect for a period of 6 years unless the 
        State requests a shorter duration;
            ``(2) may be renewed, subject to the State meeting the 
        criteria for approval otherwise applicable under this section, 
        for unlimited additional 6-year periods upon application by the 
        State; and
            ``(3) may not be suspended or terminated, in whole or in 
        part, by the Secretary at any time before the date of 
        expiration of the waiver period (including any renewal period 
        under paragraph (2)), unless the Secretary determines that the 
        State materially failed to comply with the terms and conditions 
        of the waiver.''.
    (d) Ensuring Patient Access to More Flexible Health Plans.--Section 
1332(b)(1)(B) of the Patient Protection and Affordable Care Act (42 
U.S.C. 18052(b)(1)(B)) is amended by striking ``at least as 
affordable'' and inserting ``of comparable affordability, including for 
low-income individuals, individuals with serious health needs, and 
other vulnerable populations,''.
    (e) Applicability.--The amendments made by this Act to section 1332 
of the Patient Protection and Affordable Care Act (42 U.S.C. 18052)--
            (1) with respect to applications for waivers under such 
        section 1332 submitted after the date of enactment of this Act 
        and applications for such waivers submitted prior to such date 
        of enactment and under review by the Secretary on the date of 
        enactment, shall take effect on the date of enactment of this 
        Act; and
            (2) with respect to applications for waivers approved under 
        such section 1332 before the date of enactment of this Act, 
        shall not require reconsideration of whether such applications 
        meet the requirements of such section 1332, except that, at the 
        request of a State, the Secretary shall recalculate the amount 
        of funding provided under subsection (a)(3) of such section.

SEC. 231. ENROLLMENT PERIODS.

    (a) Exchanges.--Paragraph (7) of section 1311(c) of the Patient 
Protection and Affordable Care Act (42 U.S.C. 18031(c)), as added by 
section 106, is amended by adding at the end the following new 
subparagraph:
                    ``(B) Enrollments other than during initial, open, 
                and special enrollment periods.--Beginning with plan 
                year 2023, an Exchange may provide for enrollments 
                during periods in addition to open enrollment periods 
                described in subparagraph (A) or paragraph (6) and 
                special enrollment periods described in paragraph 
                (6).''.
    (b) Health Plans.--Subpart I of part A of title XXVII of the Public 
Health Service Act is amended by adding at the end the following new 
section:

``SEC. 2710. ENROLLMENT OUTSIDE OF INITIAL, OPEN, AND SPECIAL 
              ENROLLMENT PERIOD.

    ``Beginning with plan year 2023, a group health plan and a health 
insurance issuer offering group or individual health insurance coverage 
may provide for enrollment in such plan or coverage during periods in 
addition to initial, open, or special enrollment periods. In the case 
that an individual enrolls in such plan or coverage during a period 
pursuant to the previous sentence, the plan or issuer may charge the 
individual a one-time enrollment fee.''.

SEC. 232. STATE-OPERATED EXCHANGES FLEXIBILITY FOR OPEN ENROLLMENT 
              PERIODS.

    Section 1311(c) of the Patient Protection and Affordable Care Act 
(42 U.S.C. 18031(c)) is amended--
            (1) in paragraph (6), by striking ``The Secretary'' and 
        inserting ``Subject to paragraph (7), the Secretary''; and
            (2) by adding at the end the following new paragraph:
            ``(7) Flexibility for enrollment periods.--
                    ``(A) State-operated exchanges open enrollment 
                periods.--In the case of an Exchange operated by a 
                State, beginning with plan years of 1 year after the 
                date of enactment of this Act, the Exchange may provide 
                for open enrollment periods (after the initial 
                enrollment period) every 12, 24, or 36 months, as 
                determined by the State.''.

SEC. 233. PROMOTING HEALTH PLANS THAT COVER INDIVIDUALS IN MORE THAN 
              ONE STATE.

    There are appropriated, out of amounts in the Treasury not 
otherwise appropriated, $10,000,000 to be made available by no later 
than 1 year after the date of enactment of this Act, to the Center for 
Medicare & Medicaid Innovation to fund new research or pilot programs 
dedicated to pursuing viable methods of enrolling individuals in health 
insurance programs that cross State lines.

        TITLE III--COMPETITION, TRANSPARENCY AND ACCOUNTABILITY

              Subtitle A--Provider and Insurer Competition

SEC. 301. HOSPITAL CONSOLIDATION.

    (a) Authorization of Appropriations.--There is authorized to be 
appropriated $160,000,000 to the Federal Trade Commission to hire staff 
to investigate, as consistent with the Sherman Antitrust Act and other 
relevant Federal laws, anti-competitive mergers and practices under 
such laws to the extent such mergers and practices relate to providers 
of inpatient and outpatient health care services, as defined by the 
Secretary of Health and Human Services.
    (b) Medicare Advantage Rates Applied to Certain HHI Hospitals.--
            (1) In general.--Section 1866(a) of the Social Security Act 
        (42 U.S.C. 1395cc(a)) is amended--
                    (A) in paragraph (1)--
                            (i) in subparagraph (X), by striking 
                        ``and'' at the end;
                            (ii) in subparagraph (Y), by striking the 
                        period at the end and inserting ``; and''; and
                            (iii) by inserting after subparagraph (Y) 
                        the following new subparagraph:
                    ``(Z) subject to paragraph (4), in the case of a 
                hospital located in a county whose population density 
                is above the median population density for all counties 
                in the United States with respect to which there is a 
                Herfindahl-Hirschman Index (HHI) of greater than 4,000, 
                to apply the average reimbursement rate with respect to 
                individuals (regardless of whether such an individual 
                is entitled to or eligible for benefits under this 
                title, but excluding individuals eligible for medical 
                assistance under a State plan under title XIX) 
                furnished items and services at such hospital that 
                would be billable under this title for such items and 
                services if furnished by such hospital to an individual 
                enrolled under part C.''; and
                    (B) by adding at the end the following new 
                paragraph:
            ``(4)(A) The requirement under paragraph (1)(Z) shall not 
        apply in the case of a hospital in a hospital referral region 
        if--
                    ``(i) the HRR market share of such hospital (as 
                determined under subparagraph (B)) is less than 0.15; 
                or
                    ``(ii) the hospital is located in a rural area (as 
                defined in section 1886(d)(2)(D)).
            ``(B) For purposes of subparagraph (A), the HRR market 
        share of a hospital in a hospital referral region is equal to--
                    ``(i) the total revenue of the hospital, divided by
                    ``(ii) the total revenue of all hospital in the 
                hospital referral region.''.
            (2) Effective date.--The amendments made by this subsection 
        shall apply with respect to items and services furnished on or 
        after January 1, 2023.
    (c) Grants for Hospital Infrastructure Improvement.--
            (1) In general.--The Secretary of Health and Human Services 
        shall carry out a grant program under which the Secretary shall 
        provide grants to eligible States, in accordance with this 
        subsection.
            (2) Uses.--An eligible State receiving a grant under this 
        subsection may use such grant to improve the State hospital 
        infrastructure and to supplement any other funds provided for a 
        purpose authorized under a State or local hospital grant 
        program under State law.
            (3) Eligibility.--
                    (A) In general.--An eligible State may receive not 
                more than one grant under this subsection with respect 
                to each qualifying criterion described in subparagraph 
                (B) that is met by the State.
                    (B) Eligible state.--For purposes of this 
                subsection, the term ``eligible State'' means a State 
                that meets any one or more of the following qualifying 
                criteria:
                            (i) The State does not have in effect any 
                        State certificate of need law that requires a 
                        health care provider to provide to a regulatory 
                        body a certification that the community needs 
                        the services provided by the health care 
                        provider.
                            (ii) The State has in effect State scope of 
                        practice laws that--
                                    (I) allow advanced practice 
                                providers (such as nurse practitioners, 
                                advanced practice registered nurses, 
                                clinical nurse specialists, and 
                                physician assistants) to evaluate 
                                patients; diagnose, order, and 
                                interpret diagnostic tests; and 
                                initiate and manage treatments; or
                                    (II) provide that the only 
                                justification for limiting the scope of 
                                practice of a health care provider is 
                                safety to the public.
                            (iii) The State does not have in effect any 
                        State laws that require managed care plans to 
                        accept into the network of such plan any 
                        qualified provider who is willing to accept the 
                        terms and conditions of the managed care plan.
                            (iv) The State does not have in effect any 
                        Certificate of Public Advantage laws that 
                        clearly articulate the State's intent to 
                        displace competition in favor of regulation or 
                        that violate State or Federal antitrust laws.
                            (v) The State does not have in effect any 
                        network adequacy laws regulating a health 
                        plan's ability to deliver benefits by providing 
                        reasonable access to a sufficient number of in-
                        network primary care and specialty physicians, 
                        as well as all health care services included 
                        under the terms of an insuree's contract with a 
                        health insurer.
            (4) Funding.--There is authorized to be appropriated to 
        carry out this subsection $1,000,000,000 for each of the fiscal 
        years 2022 through 2031. Funds appropriated under this 
        paragraph shall remain available until expended.
    (d) Critical Access Hospital Reimbursement Rates.--
            (1) Part a.--Section 1814(l)(1) of the Social Security Act 
        (42 U.S.C. 1395f(l)(1)) is amended by inserting ``(or, for 
        2023, 102, plus 1 percentage point for each subsequent year 
        through 2031, and 110 for each subsequent year thereafter)'' 
        after ``101''.
            (2) Part b.--Section 1834(g)(1) of such Act (42 U.S.C. 
        1395m(g)(1)) is amended by inserting ``(or, for 2023, 102, plus 
        1 percentage point for each subsequent year through 2031, and 
        110 for each subsequent year thereafter)'' after ``101''.

SEC. 302. AUTHORITY OF FEDERAL TRADE COMMISSION OVER CERTAIN TAX-EXEMPT 
              ORGANIZATIONS.

    Section 4 of the Federal Trade Commission Act (15 U.S.C. 44) is 
amended, in the undesignated paragraph relating to the definition of 
the term ``Corporation''--
            (1) by striking ``, and any'' and inserting ``, any''; and
            (2) by inserting before the period at the end the 
        following: ``, and any organization described in section 
        501(c)(3) of the Internal Revenue Code of 1986 that is exempt 
        from taxation under section 501(a) of such Code''.

SEC. 303. LEVELING THE PLAYING FIELD BETWEEN PAYERS AND PROVIDERS.

    (a) Exemption.--It shall not be a violation of the antitrust laws 
for one or more private health insurer issuers or their designated 
agents to jointly negotiate prices of particular hospital services with 
a hospital provider with regards to the reimbursement policies of the 
insurers for those services.
    (b) Definitions.--For purposes of this section:
            (1) Antitrust laws.--The term ``antitrust laws'' has the 
        meaning given it in subsection (a) of the 1st section of the 
        Clayton Act (15 U.S.C. 12(a)), except that such term includes 
        section 5 of the Federal Trade Commission Act (15 U.S.C. 45) to 
        the extent such section 5 applies to unfair methods of 
        competition.
            (2) Health insurance issuer.--The term ``health insurance 
        issuer'' means an insurance company, insurance service, or 
        insurance organization (including a health maintenance 
        organization, as defined in subparagraph (C)) which is licensed 
        to engage in the business of insurance in a State and which is 
        subject to State law which regulates insurance (within the 
        meaning of section 514(b)(2) of the Employee Retirement Income 
        Security Act of 1974 (29 U.S.C. 1144(b)(2))). Such term does 
        not include a group health plan.
            (3) Health maintenance organization.--The term ``health 
        maintenance organization'' means--
                    (A) a Federally qualified health maintenance 
                organization (as defined in section 300e(a) of title 42 
                of the United States Code),
                    (B) an organization recognized under State law as a 
                health maintenance organization, or
                    (C) a similar organization regulated under State 
                law for solvency in the same manner and to the same 
                extent as such a health maintenance organization.
    (c) Effective Date.--This section shall take effect on the date of 
the enactment of this Act but shall not apply with respect to conduct 
that occurs before such date.

SEC. 304. BANNING ANTICOMPETITIVE TERMS IN FACILITY AND INSURANCE 
              CONTRACTS THAT LIMIT ACCESS TO HIGHER QUALITY, LOWER COST 
              CARE.

    (a) In General.--Section 2729B of the Public Health Service Act, as 
added by section 301, is amended by adding at the end the following:
    ``(b) Protecting Health Plans Network Design Flexibility.--
            ``(1) In general.--A group health plan or a health 
        insurance issuer offering group or individual health insurance 
        coverage shall not enter into an agreement with a provider, 
        network or association of providers, or other service provider 
        offering access to a network of service providers if such 
        agreement, directly or indirectly--
                    ``(A) restricts the group health plan or health 
                insurance issuer from--
                            ``(i) directing or steering enrollees to 
                        other health care providers; or
                            ``(ii) offering incentives to encourage 
                        enrollees to utilize specific health care 
                        providers;
                    ``(B) requires the group health plan or health 
                insurance issuer to enter into any additional contract 
                with an affiliate of the provider, such as an affiliate 
                of the provider, as a condition of entering into a 
                contract with such provider;
                    ``(C) requires the group health plan or health 
                insurance issuer to agree to payment rates or other 
                terms for any affiliate not party to the contract of 
                the provider involved; or
                    ``(D) restricts other group health plans or health 
                insurance issuers not party to the contract from paying 
                a lower rate for items or services than the contracting 
                plan or issuer pays for such items or services.
            ``(2) Additional requirement for self-insured plans.--A 
        self-insured group health plan shall not enter into an 
        agreement with a provider, network or association of providers, 
        third-party administrator, or other service provider offering 
        access to a network of providers if such agreement directly or 
        indirectly requires the group health plan to certify, attest, 
        or otherwise confirm in writing that the group health plan is 
        bound by restrictive contracting terms between the service 
        provider and a third-party administrator that the group health 
        plan is not party to, without a disclosure that such terms 
        exist.
            ``(3) Exception for certain group model issuers.--Paragraph 
        (1)(A) shall not apply to a group health plan or health 
        insurance issuer offering group or individual health insurance 
        coverage with respect to--
                    ``(A) a health maintenance organization (as defined 
                in section 2791(b)(3)), if such health maintenance 
                organization operates primarily through exclusive 
                contracts with multi-specialty physician groups, nor to 
                any arrangement between such a health maintenance 
                organization and its affiliates; or
                    ``(B) a value-based network arrangement, such as an 
                exclusive provider network, accountable care 
                organization, center of excellence, a provider 
                sponsored health insurance issuer that operates 
                primarily through aligned multi-specialty physician 
                group practices or integrated health systems, or such 
                other similar network arrangements as determined by the 
                Secretary through rulemaking.
            ``(4) Attestation.--A group health plan or health insurance 
        issuer offering group or individual health insurance coverage 
        shall annually submit to, as applicable, the applicable 
        authority described in section 2723 or the Secretary of Labor, 
        an attestation that such plan or issuer is in compliance with 
        the requirements of this subsection.
    ``(c) Maintenance of Existing HIPAA, GINA, and ADA Protections.--
Nothing in this section shall modify, reduce, or eliminate the existing 
privacy protections and standards provided by reason of State and 
Federal law, including the requirements of parts 160 and 164 of title 
45, Code of Federal Regulations (or any successor regulations).
    ``(d) Regulations.--The Secretary, not later than 1 year after the 
date of enactment of the Fair Care Act of 2022, shall promulgate 
regulations to carry out this section.
    ``(e) Rule of Construction.--Nothing in this section shall be 
construed to limit network design or cost or quality initiatives by a 
group health plan or health insurance issuer, including accountable 
care organizations, exclusive provider organizations, networks that 
tier providers by cost or quality or steer enrollees to centers of 
excellence, or other pay-for-performance programs.
    ``(f) Clarification With Respect to Antitrust Laws.--Compliance 
with this section does not constitute compliance with the antitrust 
laws, as defined in subsection (a) of the first section of the Clayton 
Act (15 U.S.C. 12(a)).''.
    (b) Effective Date.--Section 2729B of the Public Health Service Act 
(as added by section 301 and amended by subsection (a)) shall apply 
with respect to any contract entered into on or after the date that is 
18 months after the date of enactment of this Act. With respect to an 
applicable contract that is in effect on the date of enactment of this 
Act, such section 2729B shall apply on the earlier of the date of 
renewal of such contract or 3 years after such date of enactment.

SEC. 305. REPEALING ELIGIBILITY OF CERTAIN ACOS.

    (a) In General.--Section 1899(b)(1) of the Social Security Act (42 
U.S.C. 1395jjj(b)(1)) is amended by striking subparagraphs (C) through 
(E).
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect on January 1, 2023.

SEC. 306. REPEAL OF HEALTH CARE REFORM PROVISIONS LIMITING MEDICARE 
              EXCEPTION TO THE PROHIBITION ON CERTAIN PHYSICIAN 
              REFERRALS FOR HOSPITALS.

    Sections 6001 and 10601 of the Patient Protection and Affordable 
Care Act (Public Law 111-148; 124 Stat. 684, 1005) and section 1106 of 
the Health Care and Education Reconciliation Act of 2010 (Public Law 
111-152; 124 Stat. 1049) are repealed and the provisions of law amended 
by such sections are restored as if such sections had never been 
enacted.

SEC. 307. ALTERNATIVE PAYMENT MODEL FOR CERTAIN SHOPPABLE PROCEDURES.

    (a) In General.--A group health plan and a health insurance issuer 
offering group or individual health insurance coverage (as such terms 
are defined in section 2791 of the Public Health Service Act (42 U.S.C. 
300gg-91)) may elect, with respect to a plan year, to provide a set 
payment amount to an enrollee under such plan or coverage for certain 
shoppable procedures (as defined in subsection (b)) in accordance with 
the provisions of this section in lieu of otherwise providing coverage 
for such a procedure under such plan or coverage, but only if the 
enrollee so agrees to such set payment amount.
    (b) Definition.--For purposes of this section, the term ``shoppable 
procedure'' means a procedure specified by the Secretary of Health and 
Human Services (in this section referred to as the ``Secretary'') with 
respect to which individuals may be expected to compare prices for such 
procedure of health care providers and facilities, including primary 
and preventive services, prenatal care and childbirth, common surgeries 
that can be scheduled, and other similar services.
    (c) Set Payment Rules.--A set payment described in subsection (a) 
under a group health plan or group or individual health insurance 
coverage offered by a health insurance issuer shall--
            (1) be disclosed prior to beginning of each plan year such 
        payment is in effect and shall not vary during such plan year;
            (2) be the same amount with respect to the same shoppable 
        procedure furnished in a geographic area (as defined by the 
        Secretary);
            (3) not be less than the median negotiated rate for all 
        group health plans and health insurance coverage offered in 
        such area for such procedure;
            (4) be made available to an enrolled under such plan or 
        such coverage regardless of the provider or facility furnishing 
        the shoppable procedure;
            (5) represent the entirety of the payment obligation of 
        such plan or such issuer with respect to such procedure; and
            (6) may be retained by such enrollee to the extent that the 
        amount of such payment exceeds the amount charged by such 
        provider or facility for such procedure.
    (d) Provision of Price Information.--Each health care provider and 
facility that may furnish a shoppable procedure during a year shall 
post in a public area a notice containing the prices that will be 
charged by such provider of facility with respect to each such 
procedure to individuals making payment for such services pursuant to a 
set payment amount described in subsection (a).
    (e) EHB Waiver Authority.--The Secretary may waive such provisions 
of section 1302(b) of the Patient Protection and Affordable Care Act 
(42 U.S.C. 18022(b)) with respect to a group health plan, health 
insurance issuer offering group or individual health insurance 
coverage, and a plan year as the Secretary determines necessary to 
allow for the provision of set payment amounts described in subsection 
(a).

                     Subtitle B--Price Transparency

SEC. 321. PRICE TRANSPARENCY REQUIREMENTS.

    (a) Hospitals.--Section 2718(e) of the Public Health Service Act 
(42 U.S.C. 300gg-18(e)) is amended--
            (1) by striking ``Each hospital'' and inserting the 
        following:
            ``(1) In general.--Each hospital'';
            (2) by inserting ``, in a machine-readable format, via open 
        application program interfaces (APIs)'' after ``a list'';
            (3) by inserting ``, along with such additional information 
        as the Secretary may require with respect to such charges for 
        purposes of promoting public awareness of hospital pricing in 
        advance of receiving a hospital item or service'' before the 
        period; and
            (4) by adding at the end the following:
            ``(2) Definition of standard charges.--Notwithstanding any 
        other provision of law, for purposes of paragraph (1), the term 
        `standard charges' means the rates hospitals, including 
        providers or entities that contract with or practice at a 
        hospital, charge for all items and services at a minimum, 
        chargemaster rates, rates that hospitals negotiate with third 
        party payers across all plans, including those related to a 
        patient's specific plan, discounted cash prices, and other 
        rates determined by the Secretary.
            ``(3) Enforcement.--In addition to any other enforcement 
        actions or penalties that may apply under subsection (b)(3) or 
        another provision of law, a hospital that fails to provide the 
        information required by this subsection and has not completed a 
        corrective action plan to comply with the requirements of such 
        subsection shall be subject to a civil monetary penalty of an 
        amount not to exceed $300 per day that the violation is ongoing 
        as determined by the Secretary. Such penalty shall be imposed 
        and collected in the same manner as civil money penalties under 
        subsection (a) of section 1128A of the Social Security Act are 
        imposed and collected.''.
    (b) Transparency in Coverage.--Section 1311(e)(3) of the Patient 
Protection and Affordable Care Act (42 U.S.C. 18031(e)(3)) is amended--
            (1) in subparagraph (A)--
                    (A) in clause (vii), by inserting before the period 
                the following: ``, including, for all items and 
                services covered under the plan, aggregate information 
                on specific payments the plan has made to out-of-
                network health care providers on behalf of plan 
                enrollees'';
                    (B) by designating clause (ix) as clause (x); and
                    (C) by inserting after clause (viii), the 
                following:
                            ``(ix) Information on the specific 
                        negotiated payment rates between the plan and 
                        health care providers for all items and 
                        services covered under the plan.'';
            (2) in subparagraph (B)--
                    (A) in the heading, by striking ``use'' and 
                inserting ``delivery methods and use'';
                    (B) by inserting ``, as applicable,'' after 
                ``English proficiency''; and
                    (C) by inserting after the second sentence, the 
                following: ``The Secretary shall establish standards 
                for electronic delivery and access to such information 
                by individuals, free of charge, in machine readable 
                format, through an Internet website and via open 
                APIs.'';
            (3) in subparagraph (C)--
                    (A) in the first sentence, by inserting ``or out-
                of-network provider'' after ``item or service by a 
                participating provider'';
                    (B) in the second sentence, by striking ``through 
                an Internet website'' and inserting ``free of charge, 
                in machine readable format, through an Internet 
                website, and via open APIs, in accordance with 
                standards established by the Secretary,''; and
                    (C) by adding at the end the following: ``Such 
                information shall include specific negotiated rates 
                that allow for comparison between providers and across 
                plans, and related to a patient's specific plan, 
                including after an enrollee has exceeded their 
                deductible responsibility.''; and
            (4) in subparagraph (D) by striking ``subparagraph (A)'' 
        and inserting ``subparagraphs (A), (B), and (C)''.

SEC. 322. ENSURING ENROLLEE ACCESS TO COST-SHARING INFORMATION.

    (a) In General.--Subpart II of part A of title XXVII of the Public 
Health Service Act (42 U.S.C. 300gg-11 et seq.), as amended by the 
preceding sections, is further amended by adding at the end the 
following:

``SEC. 2729F. PROVISION OF COST-SHARING INFORMATION.

    ``(a) Provider Disclosures.--A provider that is in-network with 
respect to a group health plan or a health insurance issuer offering 
group or individual health insurance coverage shall provide to an 
enrollee in the plan or coverage who submits a request for the 
information described in paragraph (1) or (2), together with accurate 
and complete information about the enrollee's coverage under the 
applicable plan or coverage--
            ``(1) as soon as practicable and not later than 2 business 
        days after the enrollee requests such information, a good faith 
        estimate of the expected enrollee cost-sharing for the 
        provision of a particular health care service (including any 
        service that is reasonably expected to be provided in 
        conjunction with such specific service); and
            ``(2) as soon as practicable and not later than 2 business 
        days after an enrollee requests such information, the contact 
        information for any ancillary providers for a scheduled health 
        care service.
    ``(b) Insurer Disclosures.--A group health plan or a health 
insurance issuer offering group or individual health insurance coverage 
shall provide an enrollee in the plan or coverage with a good faith 
estimate of the enrollee's cost-sharing (including deductibles, 
copayments, and coinsurance) for which the enrollee would be 
responsible for paying with respect to a specific health care service 
(including any service that is reasonably expected to be provided in 
conjunction with such specific service), as soon as practicable and not 
later than 2 business days after a request for such information by an 
enrollee.
    ``(c) Enforcement.--
            ``(1) In general.--Subject to paragraph (2), a health care 
        provider that violates a requirement under subsection (a) shall 
        be subject to a civil monetary penalty of not more than $10,000 
        for each act constituting such violation.
            ``(2) Procedure.--The provisions of section 1128A of the 
        Social Security Act, other than subsections (a) and (b) and the 
        first sentence of subsection (c)(1) of such section, shall 
        apply to civil money penalties under this subsection in the 
        same manner as such provisions apply to a penalty or proceeding 
        under section 1128A of the Social Security Act.''.
    (b) Effective Date.--Section 2729G of the Public Health Service 
Act, as added by subsection (a), shall apply with respect to plan years 
beginning on or after the date that is 18 months after the date of 
enactment of this Act.

SEC. 323. ACCESS OF INDIVIDUALS TO PROTECTED HEALTH INFORMATION.

    The provisions of section 164.524 of title 45, Code of Federal 
Regulations, as in effect on the day before the date of the enactment 
of this Act, shall have the force and effect of law.

SEC. 324. TIMELY BILLS FOR PATIENTS.

    (a) In General.--
            (1) Amendment.--Part P of title III of the Public Health 
        Service Act (42 U.S.C. 280g et seq.) is amended by adding at 
        the end the following:

``SEC. 399V-7. TIMELY BILLS FOR PATIENTS.

    ``(a) In General.--The Secretary shall require--
            ``(1) health care facilities, or in the case of 
        practitioners providing services outside of such a facility, 
        practitioners, to provide to patients a list of services 
        rendered during the visit to such facility or practitioner, 
        and, in the case of a facility, the name of the provider for 
        each such service, upon discharge or end of the visit or by 
        postal or electronic communication as soon as practicable and 
        not later than 5 calendar days after discharge or date of 
        visit; and
            ``(2) health care facilities and practitioners to furnish 
        all adjudicated bills to the patient as soon as practicable, 
        but not later than 45 calendar days after discharge or date of 
        visit.
    ``(b) Payment After Billing.--No patient may be required to pay a 
bill for health care services any earlier than 35 days after the 
postmark date of a bill for such services.
    ``(c) Effect of Violation.--
            ``(1) Notification and refund requirements.--
                    ``(A) Provider lists.--If a facility or 
                practitioner fails to provide a patient a list as 
                required under subsection (a)(1), such facility or 
                practitioner shall report such failure to the 
                Secretary.
                    ``(B) Billing.--If a facility or practitioner bills 
                a patient after the 45-calendar-day period described in 
                subsection (a)(2), such facility or practitioner 
                shall--
                            ``(i) report such bill to the Secretary; 
                        and
                            ``(ii) refund the patient for the full 
                        amount paid in response to such bill with 
                        interest, at a rate determined by the 
                        Secretary.
            ``(2) Civil monetary penalties.--
                    ``(A) In general.--The Secretary may impose civil 
                monetary penalties of up to $10,000 a day on any 
                facility or practitioner that--
                            ``(i) fails to provide a list required 
                        under subsection (a)(1) more than 10 times, 
                        beginning on the date of such tenth failure;
                            ``(ii) submits more than 10 bills outside 
                        of the period described in subsection (a)(2), 
                        beginning on the date on which such facility or 
                        practitioner sends the tenth such bill;
                            ``(iii) fails to report to the Secretary 
                        any failure to provide lists as required under 
                        paragraph (1)(A), beginning on the date that is 
                        45 calendar days after discharge or visit; or
                            ``(iv) fails to send any bill as required 
                        under subsection (a)(2), beginning on the date 
                        that is 45 calendar days after the date of 
                        discharge or visit, as applicable.
                    ``(B) Procedure.--The provisions of section 1128A 
                of the Social Security Act, other than subsections (a) 
                and (b) and the first sentence of subsection (c)(1) of 
                such section, shall apply to civil money penalties 
                under this subsection in the same manner as such 
                provisions apply to a penalty or proceeding under 
                section 1128A of the Social Security Act.
            ``(3) Safe harbor.--The Secretary may exempt a practitioner 
        or facility from the penalties under paragraph (2)(A) or extend 
        the period of time specified under subsection (a)(2) for 
        compliance with such subsection if a practitioner or facility--
                    ``(A) makes a good-faith attempt to send a bill 
                within 30 days but is unable to do so because of an 
                incorrect address; or
                    ``(B) experiences extenuating circumstances (as 
                defined by the Secretary), such as a hurricane or 
                cyberattack, that may reasonably delay delivery of a 
                timely bill.''.
            (2) Rulemaking.--Not later than 1 year after the date of 
        enactment of this Act, the Secretary shall promulgate final 
        regulations to define the term ``extenuating circumstance'' for 
        purposes of section 399V-7(c)(3)(B) of the Public Health 
        Service Act, as added by paragraph (1).
    (b) Group Health Plan and Health Insurance Issuer Requirements.--
Subpart II of part A of title XXVII of the Public Health Service Act 
(42 U.S.C. 300gg-11), as amended by the preceding sections, is further 
amended by adding at the end the following:

``SEC. 2729D. TIMELY BILLS FOR PATIENTS.

    ``(a) In General.--A group health plan or health insurance issuer 
offering group or individual health insurance coverage shall have in 
place business practices with respect to in-network facilities and 
practitioners to ensure that claims are adjudicated in order to 
facilitate facility and practitioner compliance with the requirements 
under section 399V-7(a).
    ``(b) Clarification.--Nothing in subsection (a) prohibits a 
provider and a group health plan or health insurance issuer from 
establishing in a contract the timeline for submission by either party 
to the other party of billing information, adjudication, sending of 
remittance information, or any other coordination required between the 
provider and the plan or issuer necessary for meeting the deadline 
described in section 399V-7(a)(2).''.
    (c) Effective Date.--The amendments made by subsections (a) and (b) 
shall take effect 6 months after the date of enactment of this Act.

SEC. 325. ADVISORY GROUP ON REDUCING BURDEN OF HOSPITAL ADMINISTRATIVE 
              REQUIREMENTS.

    (a) In General.--Not later than January 1, 2023, the Secretary of 
Health and Human Services shall convene an advisory group to provide, 
in accordance with this section, recommendations on ways the Federal 
Government could reduce the burden of administrative requirements on 
hospitals.
    (b) Recommendations.--Not later than January 1, 2024, the advisory 
board convened under this section shall--
            (1) submit to the Secretary of Health and Human Services 
        recommendations described under subsection (a) for executive 
        action and any recommendations for State actions for potential 
        consideration in making grants under section 2(c) to States; 
        and
            (2) submit to Congress recommendations described under 
        subsection (a) for legislative proposals.
    (c) Membership.--The advisory board under this section shall 
consist of the following members:
            (1) Three representatives of companies that have--
                    (A) geographically distributed workforces;
                    (B) at least 10,000 employees; and
                    (C) no more than 10 percent of such employees in 
                any single State.
            (2) Three representatives of health insurance issuers and 
        health plans, consisting of--
                    (A) one representative of for-profit health 
                insurance issuers and health plans with at least 
                20,000,000 enrollees in the employer-sponsored market;
                    (B) one representative of nonprofit health 
                insurance issuers and health plans operating in at 
                least 5 States; and
                    (C) one representative of nonprofit health 
                insurance issuers and health plans operating in a rural 
                State (as defined by the Census Bureau).
            (3) Seven public policy experts in the field of hospital 
        consolidation.

SEC. 326. DATA REPORTING TO IMPROVE THE TRANSPARENCY REGARDING HOW 340B 
              HOSPITAL COVERED ENTITIES PROVIDE CARE FOR PATIENTS.

    Section 340B of the Public Health Service Act (42 U.S.C. 256b) is 
amended by adding at the end the following new subsection:
    ``(f) Data Reporting To Improve the Transparency Regarding How 
Hospital Covered Entities Provide Care for Patients.--
            ``(1) In general.--Beginning on the date that is 14 months 
        after the date of the enactment of this subsection, and 
        annually thereafter, subject to subparagraph (C), a covered 
        entity described in subparagraph (L) or (M) of subsection 
        (a)(4), unless otherwise indicated, shall report on the 
        following, with respect to the previous year, in such a manner 
        and form as specified by the Secretary:
                    ``(A) The following information:
                            ``(i) With respect to such covered entity 
                        and with respect to each child site of such 
                        entity (as referenced in paragraph (11)), the 
                        number and percentage of individuals who are 
                        dispensed or administered drugs that are 
                        subject to an agreement under this section, 
                        organized by form of health insurance coverage 
                        of such individuals (including at least by the 
                        Medicare program under title XVIII of the 
                        Social Security Act, the Medicaid program under 
                        title XIX of such Act, health insurance 
                        coverage offered in the individual or group 
                        market or a group health plan (as such terms 
                        are defined in section 2791), and uninsured).
                            ``(ii) With respect to each such child site 
                        of such entity, the total costs incurred at 
                        each such site and the cost incurred at each 
                        such site for charity care as defined in line 
                        23 of worksheet S-10 to the Medicare cost 
                        report or in any successor form.
                    ``(B) The aggregate amount of gross reimbursement 
                received by each such covered entity (including child 
                sites of such entity) described in such subparagraph 
                (L) or (M) for all drugs purchased that are subject to 
                an agreement under this section and the entity's 
                aggregate acquisition cost for such drugs.
                    ``(C) In the case of covered entity described in 
                subparagraph (L) of subsection (a)(4), at the time of 
                application and recertification (and at least annually 
                thereafter), the contract that is the basis for 
                eligibility under the requirement under clause (i) of 
                such subparagraph and any modifications to such 
                contract for purposes of review by the Secretary.
                    ``(D) With respect to such covered entity and with 
                respect to each child site of such entity, the name of 
                all third-party vendors or other similar entities that 
                the covered entity contracts with to provide services 
                associated with the program under this section.
            ``(2) Availability of information.--
                    ``(A) In general.--The Secretary shall make data 
                reported by covered entities under subparagraphs (A), 
                (C), and (D) of paragraph (1) available on the public 
                website of the Department of Health and Human Services 
                in an electronic and searchable format, which may 
                include the 340B Office of Pharmacy Affairs Information 
                System or a successor to such system.
                    ``(B) Format.--Data made available under 
                subparagraph (A) shall be made available in a manner 
                that shows each category of data reported both in the 
                aggregate and identified by covered entities described 
                in subparagraphs (L) and (M) of subsection (a)(4) and 
                child sites of such covered entities. In carrying out 
                this paragraph, with respect to data reported pursuant 
                to paragraph (1)(C), the Secretary shall ensure that 
                any proprietary information shall be redacted from 
                contracts submitted pursuant to such paragraph (1)(C) 
                before posting such data.
            ``(3) Interim final regulations.--The Secretary shall issue 
        interim final regulations no later than the date that is 6 
        months after the date of the enactment of this subsection, to 
        carry out this subsection and shall finalize such regulations 
        prior to the end of the moratorium period to which subsection 
        (a)(11) applies.
            ``(4) Reports to congress.--
                    ``(A) OIG report.--Not later than 2 years after the 
                date of the enactment of this subsection, the Office of 
                the Inspector General shall submit to Congress a final 
                report on the level of charity care provided by covered 
                entities described in subparagraphs (L) and (M) of 
                subsection (a)(4) and separately by child sites of such 
                covered entities, as reported in paragraph (1)(A).
                    ``(B) GAO reports.--
                            ``(i) Initial report.--Not later than 1 
                        year after the date of the enactment of this 
                        subsection, the Comptroller General of the 
                        United States shall submit to Congress a 
                        report--
                                    ``(I) analyzing the State and local 
                                government contracts intended to 
                                satisfy the requirement under 
                                subsection (a)(4)(L)(i) for a covered 
                                entity to qualify as an entity 
                                described in subparagraph (L) of 
                                subsection (a)(4);
                                    ``(II) assessing the amount of care 
                                such contracts obligate such entity to 
                                provide to low-income individuals 
                                ineligible for Medicare under title 
                                XVIII of the Social Security Act and 
                                Medicaid under title XIX of such Act; 
                                and
                                    ``(III) analyzing how these 
                                contracts define low-income individuals 
                                and whether the Secretary reviews such 
                                determinations.
                            ``(ii) Subsequent report.--Not later than 2 
                        years after the date of the enactment of this 
                        subsection, the Comptroller General of the 
                        United States shall submit to Congress a final 
                        report on the information collected under 
                        paragraph (1)(B) regarding the difference 
                        between the aggregate gross reimbursement and 
                        aggregate acquisition costs received by each 
                        such covered entity (including child sites of 
                        such entity) for drugs subject to an agreement 
                        under this section.''.

SEC. 327. REQUIRING 340B DRUG DISCOUNT PROGRAM REPORTS BY DSH HOSPITAL 
              COVERED ENTITIES ON LOW-INCOME UTILIZATION RATE OF 
              OUTPATIENT HOSPITAL SERVICES.

    (a) In General.--Section 340B(d)(2) of the Public Health Service 
Act (42 U.S.C. 256b(d)(2)) is amended--
            (1) in subparagraph (B)(i), by inserting before the period 
        at the end the following: ``, including, with respect to such 
        updates made on or after one year after the date of enactment 
        of the Act, by requiring covered entities described in 
        subsection (a)(4)(L) to submit (and to so regularly update) 
        information described in subparagraph (C)''; and
            (2) by adding at the end the following new subparagraph:
                    ``(C) Information on low-income utilization rate of 
                outpatient hospital services.--
                            ``(i) In general.--For purposes of 
                        subparagraph (B)(i), the information described 
                        in this subparagraph, with respect to a covered 
                        entity described in subsection (a)(4)(L) and an 
                        update under such subparagraph (B)(i), is--
                                    ``(I) the low-income outpatient 
                                utilization rate of such covered entity 
                                for the most recent fiscal year; and
                                    ``(II) the low-income outpatient 
                                utilization rate of off-site outpatient 
                                facilities, clinics, eligible off-site 
                                locations, and associated sites of such 
                                entity identified as child sites of 
                                such entity pursuant to the 
                                identification system under 
                                subparagraph (B)(iv) for the most 
                                recent fiscal year.
                            ``(ii) Low-income outpatient utilization 
                        rate defined.--In this subparagraph, the term 
                        `low-income outpatient utilization rate' has 
                        the meaning given the term `low-income 
                        utilization rate' under paragraph (3) of 
                        section 1923(b) of the Social Security Act, 
                        except that--
                                    ``(I) clauses (i) and (ii) of 
                                subparagraph (A) of such paragraph 
                                shall be applied as if--
                                            ``(aa) each reference to 
                                        `patient services' were a 
                                        reference to `patient services 
                                        furnished on an outpatient 
                                        basis'; and
                                            ``(bb) for purposes of 
                                        clause (i)(II) of this 
                                        subparagraph, each reference to 
                                        `hospital' were a reference to 
                                        `off-site outpatient 
                                        facilities, clinics, eligible 
                                        off-site locations, and 
                                        associated sites of the 
                                        hospital that are identified as 
                                        child sites of the hospital 
                                        pursuant to the identification 
                                        system under section 
                                        340B(d)(2)(B)(iv) of the Public 
                                        Health Service Act'; and
                                    ``(II) clauses (i) and (ii) of 
                                subparagraph (B) of such paragraph 
                                shall be applied as if--
                                            ``(aa) each reference to 
                                        `inpatient hospital services' 
                                        were a reference to `outpatient 
                                        hospital services'; and
                                            ``(bb) for purposes of 
                                        clause (i)(II) each reference 
                                        to `hospital's charges' were a 
                                        reference to `charges of the 
                                        off-site outpatient facilities, 
                                        clinics, eligible off-site 
                                        locations, and associated sites 
                                        of the hospital that are 
                                        identified as child sites of 
                                        the hospital pursuant to the 
                                        identification system under 
                                        section 340B(d)(2)(B)(iv) of 
                                        the Public Health Service 
                                        Act'.''.
    (b) Annual Reports.--Not later than 1 year after the date of 
enactment of this Act, and annually thereafter, the Administrator of 
the Health Resources and Services Administration shall submit to 
Congress a report on information submitted by covered entities for the 
previous year pursuant to the amendments made by subsection (a).

SEC. 328. EMPLOYER BENEFITS REPORTS.

    (a) In General.--Subject to subsection (b), for each plan year 
beginning on or after 1 year after the date of enactment of this Act, a 
group health plan and a health insurance issuer offering group health 
insurance coverage shall provide to each individual enrolled in such 
plan or such coverage for such plan year a notification containing the 
following:
            (1) The amount the sponsor of such group health plan 
        expended with respect to such individual under such plan for 
        such plan year (or, in the case of a health insurance issuer 
        offering group health insurance coverage, the amount the 
        employer of such individual contributed for such coverage for 
        such individual for such plan year).
            (2) The amount the sponsor of such group health plan 
        expended with respect to such individual under such plan for 
        each previous plan year (or, in the case of a health insurance 
        issuer offering group health insurance coverage, the amount the 
        employer of such individual contributed for such coverage for 
        such individual for each previous plan year), if applicable.
    (b) Limitation.--Subsection (a) shall not apply to a group health 
plan, or a health insurance issuer offering group health insurance 
coverage, for a plan year if, for such plan year, the number of 
individuals enrolled under such plan or such coverage was less than 
100.
    (c) Penalty.--In the case that the Secretary of Health and Human 
Services determines that a group health plan or a health insurance 
issuer offering group health insurance failed to provide the notice 
required under subsection (a), the Secretary may impose a civil 
monetary penalty on the sponsor of such plan or such issuer, as 
applicable, in an amount not to exceed $100 per individual enrolled in 
such plan or such coverage per day that such sponsor or issuer failed 
to provide such notification to such individual.
    (d) Definitions.--In this section, the terms ``group health plan'', 
``group health insurance coverage'', ``health insurance issuer'', and 
``sponsor'' have the meaning given such terms in section 2791 of the 
Public Health Service Act (42 U.S.C. 300gg-91).

SEC. 329. GOVERNMENT ACCOUNTABILITY OFFICE STUDY ON PROFIT- AND 
              REVENUE-SHARING IN HEALTH CARE.

    (a) Study.--Not later than 1 year after the date of enactment of 
this Act, the Comptroller General of the United States shall conduct a 
study to--
            (1) describe what is known about profit- and revenue-
        sharing relationships in the commercial health care markets, 
        including those relationships that--
                    (A) involve one or more--
                            (i) physician groups that practice within a 
                        hospital included in the profit- or revenue-
                        sharing relationship, or refer patients to such 
                        hospital;
                            (ii) laboratory, radiology, or pharmacy 
                        services that are delivered to privately 
                        insured patients of such hospital;
                            (iii) surgical services;
                            (iv) hospitals or group purchasing 
                        organizations; or
                            (v) rehabilitation or physical therapy 
                        facilities or services; and
                    (B) include revenue- or profit-sharing whether 
                through a joint venture, management or professional 
                services agreement, or other form of gain-sharing 
                contract;
            (2) describe Federal oversight of such relationships, 
        including authorities of the Department of Health and Human 
        Services and the Federal Trade Commission to review such 
        relationships and their potential to increase costs for 
        patients, and identify limitations in such oversight; and
            (3) as appropriate, make recommendations to improve Federal 
        oversight of such relationships.
    (b) Report.--Not later than 1 year after the date of enactment of 
this Act, the Comptroller General of the United States shall prepare 
and submit a report on the study conducted under subsection (a) to the 
Committee on Health, Education, Labor, and Pensions of the Senate and 
the Committee on Education and Labor and Committee on Energy and 
Commerce of the House of Representatives.

        Subtitle C--Prescription Drug Competition and Innovation

SEC. 341. EXPEDITED DEVELOPMENT AND PRIORITY REVIEW FOR GENERIC COMPLEX 
              DRUG PRODUCTS.

    Subchapter A of chapter V of the Federal Food, Drug, and Cosmetic 
Act (21 U.S.C. 351 et seq.) is amended by adding at the end the 
following:

``SEC. 524B. EXPEDITED DEVELOPMENT AND PRIORITY REVIEW FOR GENERIC 
              COMPLEX DRUG PRODUCTS.

    ``(a) Establishment of Program.--The Secretary shall establish a 
program to expedite the development of, and provide priority review 
under section 505(j) for, generic complex drug products.
    ``(b) Request for Designation.--A sponsor of a generic complex drug 
product may request that the Secretary designate such product for 
expedited development and priority review under this section.
    ``(c) Designation Process.--
            ``(1) In general.--Not later than 60 calendar days after 
        the receipt of a request under subsection (c), the Secretary 
        shall determine whether the product that is the subject of the 
        request meets the criteria under subsection (e) to be 
        considered a generic complex drug product. If the Secretary 
        determines that the product meets the criteria, the Secretary 
        shall designate the product for expedited development and 
        priority review.
            ``(2) Review.--Review of a request under subsection (b) 
        shall be undertaken by a team that is composed of experienced 
        staff and senior managers of the Food and Drug Administration.
            ``(3) Withdrawal.--The Secretary may not withdraw a 
        designation granted under this section on the basis of the 
        criteria under subsection (e) no longer applying because of the 
        subsequent clearance or approval of any other product.
    ``(d) Expedited Development and Priority Review Guidance.--
            ``(1) Content.--Not later than 1 year after the date of 
        enactment of this Act, the Secretary shall issue guidance on 
        the implementation of this section. Such guidance shall--
                    ``(A) set forth the process by which a person may 
                seek a designation under subsection (c);
                    ``(B) provide a template for requests under 
                subsection (b);
                    ``(C) identify the criteria the Secretary will use 
                in evaluating a request for designation under this 
                section; and
                    ``(D) identify the criteria and processes the 
                Secretary will use to expedite the development and 
                review of products designated under this section.
            ``(2) Process.--Prior to finalizing the guidance under 
        paragraph (1), the Secretary shall seek public comment on a 
        draft version of that guidance.
    ``(e) Generic Complex Drug Product Defined.--In this section, the 
term `generic complex drug product' means a product that represents a 
complex therapy that consists of or includes a drug for approval under 
section 505(j) and that--
            ``(1)(A) contains complex active ingredients (such as 
        peptides, polymeric compounds, complex mixtures of active 
        ingredients, and naturally sourced ingredients);
            ``(B) is composed of complex formulations (such as 
        liposomes or colloids);
            ``(C) requires a complex route of delivery (such as locally 
        acting drugs such as dermatological products and complex 
        ophthalmological products and otic dosage forms that are 
        formulated as suspensions, emulsions, or gels); or
            ``(D) involves a complex dosage form (such as transdermals, 
        metered dose inhalers, or extended release injectables);
            ``(2) presents as a complex drug-device combination product 
        (such as auto injectors or metered dose inhalers); or
            ``(3) is a product that would benefit from early scientific 
        engagement due to complexity or uncertainty concerning the 
        approval pathway under section 505(j).''.

SEC. 342. PREVENTING BLOCKING OF GENERIC DRUGS.

    (a) In General.--Section 505(j)(5)(B)(iv)(I) of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 355(j)(5)(B)(iv)(I)) is amended--
            (1) by striking ``180 days after the date'' and inserting 
        ``180 days after the earlier of the following:
                            ``(aa) The date''; and
            (2) by adding at the end the following:
                            ``(bb) The date on which all of the 
                        following conditions are first met, provided no 
                        application submitted by any first applicant is 
                        approved on or before such date:
                                    ``(AA) An application for the drug 
                                submitted by an applicant other than a 
                                first applicant has received tentative 
                                approval and could receive approval, if 
                                no first applicant were eligible for 
                                180-day exclusivity under this clause, 
                                and such applicant has not entered into 
                                an agreement that would prevent 
                                commercial marketing upon approval and 
                                has submitted a notification to the 
                                Secretary documenting that it has not 
                                entered into an agreement that would 
                                prevent commercial marketing.
                                    ``(BB) Thirty-three months have 
                                passed since the date of submission of 
                                an application for the drug by one 
                                first applicant, if there is only one 
                                first applicant, or, in the case of 
                                more than one first applicant, 33 
                                months have passed since the date of 
                                submission of all such applications.
                                    ``(CC) Approval of an application 
                                for the drug submitted by at least one 
                                first applicant would not be precluded 
                                under clause (iii).''.
    (b) Information.--Not later than 60 days of the date of enactment 
of this Act, the Secretary of Health and Human Services (referred to in 
this subsection as the ``Secretary'') shall publish, as appropriate and 
available, information sufficient to allow applicants to assess whether 
the conditions described in subitems (AA) through (CC) of section 
505(j)(5)(B)(iv)(I)(bb) of the Federal Food, Drug, and Cosmetic Act (as 
amended by subsection (a)) have been or will be satisfied for all 
applications where the exclusivity period under (iv)(I) of section 
505(j)(5)(B) of the Federal Food, Drug, and Cosmetic Act (as so 
amended) has not expired, and shall provide updates to reflect the most 
recent information available to the Secretary.

SEC. 343. ENSURING TIMELY ACCESS TO GENERICS.

    Section 505(q) of the Federal Food, Drug, and Cosmetic Act (21 
U.S.C. 355(q)) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (A)(i), by inserting ``, 
                10.31,'' after ``10.30'';
                    (B) in subparagraph (E)--
                            (i) by striking ``application and'' and 
                        inserting ``application or'';
                            (ii) by striking ``If the Secretary'' and 
                        inserting the following:
                            ``(i) In general.--If the Secretary''; and
                            (iii) by striking the second sentence and 
                        inserting the following:
                            ``(ii) Primary purpose of delaying.--
                                    ``(I) In general.--In determining 
                                whether a petition was submitted with 
                                the primary purpose of delaying an 
                                application, the Secretary may consider 
                                the following factors:
                                            ``(aa) Whether the petition 
                                        was submitted in accordance 
                                        with paragraph (2)(B), based on 
                                        when the petitioner knew or 
                                        reasonably should have known 
                                        the relevant information relied 
                                        upon to form the basis of such 
                                        petition.
                                            ``(bb) Whether the 
                                        petitioner has submitted 
                                        multiple or serial petitions or 
                                        supplements to petitions 
                                        raising issues that reasonably 
                                        could have been known to the 
                                        petitioner at the time of 
                                        submission of the earlier 
                                        petition or petitions.
                                            ``(cc) Whether the petition 
                                        was submitted close in time to 
                                        a known, first date upon which 
                                        an application under subsection 
                                        (b)(2) or (j) of this section 
                                        or section 351(k) of the Public 
                                        Health Service Act could be 
                                        approved.
                                            ``(dd) Whether the petition 
                                        was submitted without relevant 
                                        data or information in support 
                                        of the scientific positions 
                                        forming the basis of such 
                                        petition.
                                            ``(ee) Whether the petition 
                                        raises the same or 
                                        substantially similar issues as 
                                        a prior petition to which the 
                                        Secretary has responded 
                                        substantively already, 
                                        including if the subsequent 
                                        submission follows such 
                                        response from the Secretary 
                                        closely in time.
                                            ``(ff) Whether the petition 
                                        requests changing the 
                                        applicable standards that other 
                                        applicants are required to 
                                        meet, including requesting 
                                        testing, data, or labeling 
                                        standards that are more onerous 
                                        or rigorous than the standards 
                                        the Secretary has determined to 
                                        be applicable to the listed 
                                        drug, reference product, or 
                                        petitioner's version of the 
                                        same drug.
                                            ``(gg) The petitioner's 
                                        record of submitting petitions 
                                        to the Food and Drug 
                                        Administration that have been 
                                        determined by the Secretary to 
                                        have been submitted with the 
                                        primary purpose of delay.
                                            ``(hh) Other relevant and 
                                        appropriate factors, which the 
                                        Secretary shall describe in 
                                        guidance.
                                    ``(II) Guidance.--The Secretary may 
                                issue or update guidance, as 
                                appropriate, to describe factors the 
                                Secretary considers in accordance with 
                                subclause (II).'';
                    (C) by adding at the end the following:
                            ``(iii) Referral to the federal trade 
                        commission.--The Secretary shall establish 
                        procedures for referring to the Federal Trade 
                        Commission any petition or supplement to a 
                        petition that the Secretary determines was 
                        submitted with the primary purpose of delaying 
                        approval of an application. Such procedures 
                        shall include notification to the petitioner by 
                        the Secretary.'';
                    (D) by striking subparagraph (F);
                    (E) by redesignating subparagraphs (G) through (I) 
                as subparagraphs (F) through (H), respectively; and
                    (F) in subparagraph (H), as so redesignated, by 
                striking ``submission of this petition'' and inserting 
                ``submission of this document'';
            (2) in paragraph (2)--
                    (A) by redesignating subparagraphs (A) through (C) 
                as subparagraphs (C) through (E), respectively;
                    (B) by inserting before subparagraph (C), as so 
                redesignated, the following:
                    ``(A) In general.--A person shall submit a petition 
                to the Secretary under paragraph (1) before filing a 
                civil action in which the person seeks to set aside, 
                delay, rescind, withdraw, or prevent submission, 
                review, or approval of an application submitted under 
                subsection (b)(2) or (j) of this section or section 
                351(k) of the Public Health Service Act. Such petition 
                and any supplement to such a petition shall describe 
                all information and arguments that form the basis of 
                the relief requested in any civil action described in 
                the previous sentence.
                    ``(B) Timely submission of citizen petition.--A 
                petition and any supplement to a petition shall be 
                submitted within 60 days after the person knew, or 
                reasonably should have known, the information that 
                forms the basis of the request made in the petition or 
                supplement.'';
                    (C) in subparagraph (C), as so redesignated--
                            (i) in the heading, by striking ``within 
                        150 days'';
                            (ii) in clause (i), by striking ``during 
                        the 150-day period referred to in paragraph 
                        (1)(F),''; and
                            (iii) by amending clause (ii) to read as 
                        follows:
                            ``(ii) on or after the date that is 151 
                        days after the date of submission of the 
                        petition, the Secretary approves or has 
                        approved the application that is the subject of 
                        the petition without having made such a final 
                        decision.'';
                    (D) by amending subparagraph (D), as so 
                redesignated, to read as follows:
                    ``(D) Dismissal of certain civil actions.--
                            ``(i) Petition.--If a person files a civil 
                        action against the Secretary in which a person 
                        seeks to set aside, delay, rescind, withdraw, 
                        or prevent submission, review, or approval of 
                        an application submitted under subsection 
                        (b)(2) or (j) of this section or section 351(k) 
                        of the Public Health Service Act without 
                        complying with the requirements of subparagraph 
                        (A), the court shall dismiss without prejudice 
                        the action for failure to exhaust 
                        administrative remedies.
                            ``(ii) Timeliness.--If a person files a 
                        civil action against the Secretary in which a 
                        person seeks to set aside, delay, rescind, 
                        withdraw, or prevent submission, review, or 
                        approval of an application submitted under 
                        subsection (b)(2) or (j) of this section or 
                        section 351(k) of the Public Health Service Act 
                        without complying with the requirements of 
                        subparagraph (B), the court shall dismiss with 
                        prejudice the action for failure to timely file 
                        a petition.
                            ``(iii) Final response.--If a civil action 
                        is filed against the Secretary with respect to 
                        any issue raised in a petition timely filed 
                        under paragraph (1) in which the petitioner 
                        requests that the Secretary take any form of 
                        action that could, if taken, set aside, delay, 
                        rescind, withdraw, or prevent submission, 
                        review, or approval of an application submitted 
                        under subsection (b)(2) or (j) of this section 
                        or section 351(k) of the Public Health Service 
                        Act before the Secretary has taken final agency 
                        action on the petition within the meaning of 
                        subparagraph (C), the court shall dismiss 
                        without prejudice the action for failure to 
                        exhaust administrative remedies.''; and
                    (E) in clause (iii) of subparagraph (E), as so 
                redesignated, by striking ``as defined under 
                subparagraph (2)(A)'' and inserting ``within the 
                meaning of subparagraph (C)''; and
            (3) in paragraph (4)--
                    (A) by striking ``Exceptions'' and all that follows 
                through ``This subsection does'' and inserting 
                ``Exceptions.--This subsection does'';
                    (B) by striking subparagraph (B); and
                    (C) by redesignating clauses (i) and (ii) as 
                subparagraphs (A) and (B), respectively, and adjusting 
                the margins accordingly.

SEC. 344. PREEMPTION OF STATE BARRIERS TO THE SUBSTITUTION OF 
              BIOSIMILAR PRODUCTS.

    No State, or any political subdivision thereof, may, under any 
circumstances, prohibit a pharmacy or pharmacist from dispensing, in 
place of a biological reference product, any biosimilar that the Food 
and Drug Administration has designated as an interchangeable product 
for that biological reference product.

SEC. 345. INCREASING PHARMACEUTICAL OPTIONS TO TREAT AN UNMET MEDICAL 
              NEED.

    Subsection (b) of section 506 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 356) is amended by adding at the end the 
following:
            ``(4) Unmet medical need.--For purposes of paragraph (1), a 
        drug shall be deemed to address an unmet medical need for a 
        disease or condition if fewer than 3 available drugs exist for 
        the treatment of such disease or condition.''.

SEC. 346. PROVISIONAL APPROVAL OF NEW HUMAN DRUGS.

    (a) In General.--Subchapter A of chapter V of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 351 et seq.) is amended by adding at 
the end of the following:

``SEC. 524B. PROVISIONAL APPROVAL OF NEW HUMAN DRUGS.

    ``(a) Priority Review and Evaluation of Applications.--
            ``(1) In general.--The Secretary shall establish a priority 
        review system to evaluate applications submitted under this 
        pathway for provisional approval within 90 days of receipt of a 
        completed application.
            ``(2) Review of applications during epidemics and 
        pandemics.--In the case of an epidemic or pandemic, including 
        with respect to COVID-19, the Secretary shall accept and review 
        various portions of an application submitted under the pathway 
        under this section for provisional approval on a rolling basis, 
        and the review of any part of an application so submitted shall 
        be completed not later than 3 weeks after submission.
            ``(3) Other designations.--If a drug submitted for review 
        under the pathway under this section is eligible for a special 
        designation by the Secretary under this Act, including as a 
        drug for a rare disease or condition under section 526, all 
        benefits of such other designation shall be available for use 
        under provisional approval, including any tax credits and 
        waiving of fees under chapter VII.
    ``(b) Eligibility.--A drug may be eligible for provisional approval 
under this section if the Secretary determines that the drug is 
intended for the treatment, prevention, or medical diagnosis of--
            ``(1) a serious or life-threatening disease or condition 
        for which there is a reasonable likelihood that premature death 
        will occur without early medical intervention for an individual 
        contracting or being diagnosed with such disease or condition;
            ``(2) a disease or condition that poses a threat of 
        epidemic or pandemic; or
            ``(3) a disease or condition associated with morbidity that 
        has a substantial impact on day-to-day functioning.
    ``(c) Standard of Review for Approval.--
            ``(1) Requirements.--An application for provisional 
        approval under this section may be approved only if the 
        Secretary determines that--
                    ``(A) there is substantial evidence of safety for 
                the drug, such that there is evidence consisting of 
                adequate and well-controlled investigations, including 
                clinical investigations, by experts qualified by 
                scientific training and experience to evaluate the 
                safety of the drug involved, on the basis of which it 
                could fairly and responsibly be concluded that the drug 
                will have the effect it purports or is represented to 
                have under the conditions of use prescribed, 
                recommended, or suggested in the labeling or proposed 
                labeling; and
                    ``(B) there is relevant early evidence based on 
                adequate and well-controlled investigations, including 
                early-stage clinical investigations, to establish 
                that--
                            ``(i) the drug provides a positive 
                        therapeutic outcome; and
                            ``(ii) the outcome of the drug is 
                        consistent with or greater than currently 
                        marketed on-label therapies, with equal or 
                        fewer side effects, if there are currently 
                        marketed on-label therapies.
            ``(2) Protocols.--The Secretary shall promulgate rules that 
        establish the appropriate protocols for a sponsor of an 
        application for provisional approval under this section and the 
        Commissioner to follow to enable rolling, real-time, mid-trial 
        submission while preserving the integrity of the ongoing trial 
        and without penalizing the sponsor for making use of this 
        pathway.
            ``(3) Real world evidence.--The Secretary shall allow the 
        use of real world evidence (as defined in section 505F(b)), 
        including real world data used to generate real world evidence, 
        to support an application for provisional approval under this 
        section, and to fulfill the follow-up requirements and support 
        applications for full approval as described under section 505 
        or section 351 of the Public Health Service Act, as applicable.
            ``(4) Use of scientifically substantiated surrogates.--
                    ``(A) In general.--The sponsor of an application 
                for provisional approval under this section may use 
                scientifically substantiated surrogates to support such 
                application.
                    ``(B) Definition.--In subparagraph (A), the term 
                `scientifically substantiated surrogates' means 
                surrogate endpoints to predict clinical benefit other 
                than such endpoints previously validated by the 
                Secretary, based on--
                            ``(i) epidemiologic, therapeutic, 
                        pathophysiologic, or other evidence; or
                            ``(ii) an effect on a clinical endpoint 
                        other than survival or irreversible morbidity 
                        of interest.
    ``(d) Transparency and Patient Monitoring Requirements.--
            ``(1) Registries.--
                    ``(A) In general.--The sponsor of a drug 
                provisionally approved under this section shall require 
                that all patients who use such drug participate in an 
                observational registry and consent to the sponsor's 
                collection, and submission to the registry, of data 
                related to the patient's use of such drug until such 
                drug receives full approval under section 505 or 
                section 351 of the Public Health Service Act, or the 
                provisional approval is rescinded.
                    ``(B) Requirements for registries.--An 
                observational registry described in subparagraph (A) 
                may be run by a third party, such as a government, for 
                profit, or non-profit organization, and shall track all 
                patients who use the provisionally approved drug.
                    ``(C) Accessibility.--An observational registry 
                described in subparagraph (A) shall be easily 
                accessible for--
                            ``(i) all patients who are participating in 
                        any registry related to a provisionally 
                        approved drug that allows for easy, 
                        unrestricted (or transparent) access for such 
                        patients to their patient data and related 
                        information regarding their usage of the 
                        provisionally approved drug; and
                            ``(ii) approved researchers and medical 
                        professionals who may access data maintained in 
                        the registry, which access shall be for public 
                        health research and only in a de-identified, 
                        aggregated manner.
            ``(2) Funding.--An observational registry under this 
        subsection shall be maintained, as applicable--
                    ``(A) by the sponsor of the drug provisionally 
                approved under this section that is the subject of the 
                registry;
                    ``(B) by a third party, such as a government, for 
                profit, or nonprofit organization; or
                    ``(C) the Federal Government, in the case of any 
                drug so approved that is intended to treat a disease or 
                condition associated with an epidemic or pandemic.
            ``(3) Sponsor requirements.--
                    ``(A) In general.--For any drug application 
                provisionally approved under this section, the 
                Secretary shall notify the sponsor of the exact data 
                such sponsor is required to submit to an observational 
                registry.
                    ``(B) Annual review of the registry; penalties.--
                The Secretary shall conduct an annual review of 
                observational registries established under this 
                subsection. If, at such an annual review, less than 90 
                percent of patients are participating in an 
                observational registry with respect to a drug approved 
                under this section, the Secretary shall issue to the 
                sponsor of such drug a civil monetary penalty of not 
                more than $100,000. If a violation of this section is 
                not corrected within the 30-day period following 
                notification, the sponsor shall, in addition to any 
                penalty under this subparagraph be subject to a civil 
                monetary penalty of not more than $10,000 for each day 
                of the violation after such period until the violation 
                is corrected. If application patient participation in 
                an observational registry is not at or above 90 percent 
                within 6 months of issuance of such penalty, the 
                provisional approval shall be withdrawn.
            ``(4) Annual report to congress.--The Secretary shall 
        submit an annual report to Congress on all drugs granted 
        provisional approval under this section. Such report shall 
        include--
                    ``(A) the number of patients treated with each such 
                drug, and the number of patients tracked in an 
                observational registry with respect to each such drug;
                    ``(B) a discussion of the minimum amount of data 
                required in the registries, including patient 
                treatments and uses, length of use, side effects 
                encountered, relevant biomarkers or scientifically 
                substantiated surrogates, scan results, cause of death 
                and how long the patient lived, and adverse drug 
                effects;
                    ``(C) a list of all such drugs for which an 
                application for full approval under section 505 of this 
                Act or section 351 of the Public Health Service Act, or 
                an application for an extension of provisional approval 
                under this section, has been submitted; and
                    ``(D) a list of all applications denied provisional 
                approval under this section, together with an 
                explanation for the decisions to deny each such 
                application.
    ``(e) Withdrawal of Provisional Approval.--
            ``(1) In general.--The Secretary shall withdraw provisional 
        approval under this section if there are a significant number 
        of patients who experience serious adverse effects, compared to 
        the other currently marketed on-label therapies that are 
        available for the applicable disease or condition.
            ``(2) Effect of withdrawal.--If a provisional approval is 
        withdrawn under this subsection, the sponsor may not make the 
        drug available to any new patients, but may be allowed to 
        continue to make such drug available to patients who started 
        taking the drug prior to the date of withdrawal, for as long a 
        period as dictated by patient need, as determined by the 
        Secretary.
    ``(f) Transparency.--Any scientific, medical, academic, or health 
care journal publishing an article explaining, releasing, conveying or 
announcing research findings which were funded by the Department of 
Health and Human Services shall be prohibited from publishing such 
research unless--
            ``(1) such article conveying research findings is made 
        publicly available on the journal's internet website without a 
        paywall or charge not later than 3 months after the date on 
        which such article was first provided to subscribers of such 
        journal (or first made available for purchase); and
            ``(2) the article's author or researcher or author's 
        institution (or, in the case of multiple authors, researchers, 
        or institutions, all such authors, researchers, or 
        institutions) received less than 30 percent of funding for such 
        research from the Department of Health and Human Services 
        throughout the period of time the research was conducted.
    ``(g) Informed Consent.--Prior to receiving a drug provisionally 
approved under this section, the sponsor of the drug shall receive from 
each patient, or the patient's representative, informed consent, 
through a signed informed consent form, acknowledging that such patient 
understands that the drug did not undergo the usual process for full 
approval of a drug by the Food and Drug Administration, and that such 
patient is willing to accept the risks involved in taking such drug.
    ``(h) Postmarket Controls and Labeling.--
            ``(1) FDA annual review of registry data.--The Secretary 
        shall annually review the data made available through the 
        observational registries under subsection (d) and make a 
        determination regarding whether the side effect profile of any 
        drug approved under this pathway does not support the benefit 
        provided, or the data shows the benefit is less than the 
        benefits offered through other, fully approved drugs.
            ``(2) Labeling.--The sponsor of the provisionally approved 
        drug shall ensure that all labeling and promotional materials 
        for the drug bear the statement `provisionally approved by the 
        FDA pending a full demonstration of effectiveness under 
        application number ______' (specifying the application number 
        assigned by the Secretary in place of the blank). All 
        promotional, educational and marketing materials for 
        provisionally approved products shall be reviewed and approved 
        by the Secretary before such materials are distributed.
            ``(3) Rescission of provisional approval.--If the Secretary 
        determines that the side effect profile of any drug included in 
        such observational registries does not support the benefit 
        provided by such drug, or that the data shows that the benefit 
        is less than the benefits offered through other, fully approved 
        drugs, the Secretary shall rescind such provisional approval.
    ``(i) Duration of Provisional Approval; Requirement To Bring Drug 
to Market.--
            ``(1) Duration; renewals.--The period of provisional 
        approval for a drug approved under this section is effective 
        for a 2-year period. The sponsor may request renewal for 
        provisional approval status for up to 3 subsequent 2-year 
        periods by the Secretary. Provisional approval status with 
        respect to a drug shall not exceed a total of 6 years from the 
        initial date the sponsor was awarded provisional approval 
        status.
            ``(2) Marketing requirement.--If any drug that receives 
        provisional approval status under this section is not brought 
        to market within 180 days of the approval, such approval shall 
        be rescinded.
    ``(j) Limitation on Liability.--With respect to any claim under 
State law alleging that a drug sold or otherwise made available 
pursuant to a grant of provisional approval under this section is 
unsafe or ineffective, no liability in a cause of action shall lie 
against a sponsor or manufacturer, unless the relevant conduct 
constitutes reckless or willful misconduct, gross negligence, or an 
intentional tort under any applicable State law.
    ``(k) Applying for Full Approval.--
            ``(1) In general.--Except as provided under paragraph (2), 
        the sponsor of a drug granted provisional approval pursuant to 
        this section may, at any point, submit an application for full 
        approval of such drug under section 505 of this Act or section 
        351 of the Public Health Service Act, as applicable.
            ``(2) Effect of recession on approval and automatic 
        approval.--
                    ``(A) In general.--The sponsor of a drug granted 
                provisional approval pursuant to this section that has 
                been rescinded under subsection (h)(3), may submit an 
                application for full approval of such drug under 
                section 505 of this Act or section 351 of the Public 
                Health Service Act at any time.
                    ``(B) Automatic approval.--Such full approval may 
                be awarded at any time for any drug granted provisional 
                approval pursuant to this section if the sponsor of the 
                drug establishes a 15 percent improvement in an 
                important endpoint, including surrogate endpoints not 
                validated by the Food and Drug Administration, compared 
                to a standard drug.
            ``(3) Real-time epidemic and pandemic vaccine approval.--
                    ``(A) In general.--In the case of a vaccine 
                developed in response to an epidemic or pandemic, 
                including COVID-19, the Secretary shall share data 
                information regarding the approval of the vaccine with 
                the Advisory Committee on Immunization Practices of the 
                Centers for Disease Control and Prevention as the 
                review nears completion.
                    ``(B) Evaluation.--Any vaccine that has been 
                approved by the Secretary for an epidemic or pandemic-
                related disease, including COVID-19, shall be evaluated 
                by the Advisory Committee on Immunization Practices of 
                the Centers for Disease Control and Prevention not 
                later than 1 week after the date of submission to the 
                Advisory Committee by the Secretary of the vaccine.
    ``(l) Patient Advocate General.--Not later than 6 months after the 
date of enactment of the Promising Pathway Act, the Secretary shall 
establish within the Office of the Commissioner, the position of 
Patient Advocate General, who shall provide assistance to patients and 
their families who use drugs under evaluation in this pathway or drugs 
reviewed or approved under section 505 or section 351 of the Public 
Health Service Act. Such assistance shall include providing bi-
informational communication about maintaining patient health, delivery 
of proper informed consent, participating in clinical investigations, 
completing required documentation in order to participate in the 
applicable programs, and providing other information.''.
    (b) Conforming Amendment.--Section 505(a) of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 355(a)) is amended by inserting ``, 
or there is in effect a provisional approval under section 524B with 
respect to such drug'' before the period.
    (c) Reimbursement.--
            (1) Private health insurers.--Section 2719A of the Public 
        Health Service Act (42 U.S.C. 300gg-19a) is amended by adding 
        at the end the following:
    ``(e) Treatment of Certain Drugs.--A group health plan or health 
insurance issuer of group or individual health insurance coverage shall 
not deny coverage of any drug provisionally approved under section 524B 
of the Federal Food, Drug, and Cosmetic Act on the basis of such drug 
being experimental. In determining coverage under the applicable plan 
or coverage, a group health plan or health insurance issuer shall treat 
a drug provisionally approved under such section in the same manner as 
such plan or coverage would treat a drug approved under section 505 of 
the Federal Food, Drug, and Cosmetic Act or section 351 of this Act. 
Nothing in this subsection shall be construed to require a group health 
plan or health insurance issuer to cover any specific drug 
provisionally approved under such section 524B.''.
            (2) Federal health care programs.--The requirement under 
        subsection (e) of section 2719A of the Public Health Service 
        Act (as added by paragraph (1)) shall apply with respect to 
        coverage determinations under a Federal health care program (as 
        defined in section 1128B(f) of the Social Security Act (42 
        U.S.C. 1320a-7b(f))) in the same manner such requirement 
        applies under such subsection (e).
            (3) Conforming amendment.--Section 1927(k)(2)(A)(i) of the 
        Social Security Act (42 U.S.C. 1396r-8(k)(2)(A)(i)) is 
        amended--
                    (A) by striking ``or which'' and inserting ``, 
                which''; and
                    (B) by inserting ``, or which is provisionally 
                approved under section 524B of such Act'' before the 
                semicolon.

SEC. 347. CONSOLIDATING EXCLUSIVITY PERIODS FOR DRUGS TREATING RARE 
              DISEASES AND CONDITIONS.

    (a) In General.--Subsection (a) of section 527 of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 360cc) is amended to read as follows:
    ``(a) Exclusivity.--
            ``(1) In general.--Except as provided in subsection (b), if 
        the Secretary approves an application filed pursuant to section 
        505, or issues a license under section 351 of the Public Health 
        Service Act, for a drug designated under section 526 for a rare 
        disease or condition, the Secretary may not approve an 
        application filed pursuant to section 505, or issue a license 
        under section 351 of the Public Health Service Act, for the 
        same drug for the same disease or condition for a person who is 
        not the holder of such approved application or of such license 
        until the expiration of the exclusivity period described in 
        paragraph (2).
            ``(2) Exclusivity period described.--The exclusivity period 
        described in this paragraph, with respect to a drug designated 
        under section 526 for a rare disease or condition, is--
                    ``(A) a single 7-year period of exclusivity with 
                respect to the first designation of such drug under 
                such section for that rare disease or condition; or
                    ``(B) in the case of a drug that has previously 
                received a period of exclusivity under paragraph (1), a 
                single 3-year period of exclusivity with respect to any 
                subsequent designation of such drug under such section 
                for any other rare disease or condition.
            ``(3) Limitation.--In the case of a drug that has received 
        two periods of exclusivity pursuant to paragraph (1), no 
        additional exclusivity period under this section is available 
        with respect to such drug, regardless of whether such drug has 
        been designated under section 526 for a rare disease or 
        condition that is distinct from the rare disease or condition 
        for which such exclusivity periods were granted.''.
    (b) Conforming Amendments.--
            (1) Section 505(j)(5)(B)(iv)(II)(dd)(AA) of the Federal 
        Food, Drug, and Cosmetic Act (21 U.S.C. 360cc) is amended by 
        striking ``7-year period'' and inserting ``exclusivity 
        period''.
            (2) Section 505A(b)(1)(A)(ii) of the Federal Food, Drug, 
        and Cosmetic Act (21 U.S.C. 360cc) is amended by striking 
        ``rather than seven years;'' and inserting ``, or three years 
        and six months, rather than seven years or three years, 
        respectively;''.
            (3) Section 505A(c)(1)(A)(ii) of the Federal Food, Drug, 
        and Cosmetic Act (21 U.S.C. 360cc) is amended by striking 
        ``rather than seven years;'' and inserting ``, or three years 
        and six months, rather than seven years or three years, 
        respectively;''.
            (4) Section 505E(a) of the Federal Food, Drug, and Cosmetic 
        Act (21 U.S.C. 360cc) is amended by striking ``7-year period'' 
        and inserting ``exclusivity periods''.
            (5) Section 527(b) of the Federal Food, Drug, and Cosmetic 
        Act (21 U.S.C. 360cc) is amended by striking ``the 7-year 
        period'' and inserting ``any exclusivity period''.
            (6) Section 351(m)(2)(B) of the Public Health Service Act 
        (42 U.S.C. 262) is amended by striking ``rather than 7 years'' 
        and inserting ``or 3 years and 6 months, rather than 7 years or 
        3 years, respectively''.
            (7) Section 351(m)(3)(B) of the Public Health Service Act 
        (42 U.S.C. 262) is amended by striking ``rather than 7 years'' 
        and inserting ``or 3 years and 6 months, rather than 7 years or 
        3 years, respectively''.

SEC. 348. EXCLUSIVITY PERIOD FOR BRAND NAME BIOLOGICAL PRODUCTS.

    (a) In General.--Section 351(k)(7)(A) of the Public Health Service 
Act (42 U.S.C. 262(k)(7)(A)) is amended by striking ``12 years'' and 
inserting ``5 years''.
    (b) Conforming Changes.--Paragraphs (2)(A) and (3)(A) of section 
351(m) of the Public Health Service Act (42 U.S.C. 262(m)) is amended 
by striking ``12 years'' each place it appears and inserting ``5 
years''.
    (c) Applicability.--This Act and the amendments made by this Act 
apply only with respect to a biological product for which the reference 
product (as such term is used in section 351 of the Public Health 
Service Act (42 U.S.C. 262)) is licensed under subsection (a) of such 
section on or after the date of enactment of this Act.

SEC. 349. REGULATION OF MANUFACTURER-SPONSORED COPAY CONTRIBUTIONS.

    Notwithstanding any other provision of law, the Secretary of Health 
and Human Services may establish a mechanism to regulate drug 
manufacturers' financial contributions to patient out-of-pocket costs, 
such as drug co-pays.

SEC. 350. ANTITRUST EXEMPTION FOR PRIVATE HEALTH INSURER ISSUERS TO 
              NEGOTIATE WHOLESALE ACQUISITION PRICES OF PRESCRIPTION 
              DRUGS PURCHASED FROM DRUG MANUFACTURERS.

    (a) Exemption.--It shall not be a violation of the antitrust laws 
for one or more private health insurer issuers or their designated 
agents to jointly negotiate wholesale acquisition prices of a 
prescription drug with a manufacturer of a prescription drug with 
regards to the reimbursement policies of the insurers of the 
manufacturer's drugs so long as no one single wholesale acquisition 
price is jointly determined between the insurance issuers or their 
designated agents.
    (b) Definitions.--For purposes of this section:
            (1) Antitrust laws.--The term ``antitrust laws'' has the 
        meaning given it in subsection (a) of the 1st section of the 
        Clayton Act (15 U.S.C. 12(a)), except that such term includes 
        section 5 of the Federal Trade Commission Act (15 U.S.C. 45) to 
        the extent such section 5 applies to unfair methods of 
        competition.
            (2) Health insurance issuer.--The term ``health insurance 
        issuer'' means an insurance company, insurance service, or 
        insurance organization (including a health maintenance 
        organization, as defined in subparagraph (C)) which is licensed 
        to engage in the business of insurance in a State and which is 
        subject to State law which regulates insurance (within the 
        meaning of section 514(b)(2) of the Employee Retirement Income 
        Security Act of 1974 (29 U.S.C. 1144(b)(2))). Such term does 
        not include a group health plan.
            (3) Health maintenance organization.--The term ``health 
        maintenance organization'' means--
                    (A) a Federally qualified health maintenance 
                organization (as defined in section 300e(a) of title 42 
                of the United States Code),
                    (B) an organization recognized under State law as a 
                health maintenance organization, or
                    (C) a similar organization regulated under State 
                law for solvency in the same manner and to the same 
                extent as such a health maintenance organization.
            (4) Manufacturer.--The term ``manufacturer'' means anyone 
        who is engaged in manufacturing, preparing, propagating, 
        compounding, processing, packaging, repackaging, or labeling of 
        a prescription drug.
            (5) Prescription drug.--The term ``prescription drug'' 
        means any human drug required by Federal law or regulation to 
        be dispensed only by a prescription, including finished dosage 
        forms and active ingredients subject to section 503(b) of the 
        Federal Food, Drug, and Cosmetic Act (21 U.S.C. 353(b)).
    (c) Effective Date.--This section shall take effect on the date of 
the enactment of this Act but shall not apply with respect to conduct 
that occurs before such date.

SEC. 351. BIOLOGICAL PRODUCT INNOVATION.

    Section 351(j) of the Public Health Service Act (42 U.S.C. 262(j)) 
is amended--
            (1) by striking ``except that a product'' and inserting 
        ``except that--
            ``(1) a product'';
            (2) by striking ``Act.'' and inserting ``Act; and''; and
            (3) by adding at the end the following:
            ``(2) no requirement under such Act regarding an official 
        compendium (as defined in section 201(j) of such Act), or other 
        reference in such Act to an official compendium (as so 
        defined), shall apply with respect to a biological product 
        subject to regulation under this section.''.

SEC. 352. PROMPT APPROVAL OF DRUGS RELATED TO SAFETY INFORMATION.

    Section 505 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 
355) is amended by adding at the end the following:
    ``(z) Prompt Approval of Drugs When Safety Information Is Added to 
Labeling.--
            ``(1) General rule.--A drug for which an application has 
        been submitted or approved under subsection (b)(2) or (j) shall 
        not be considered ineligible for approval under this section or 
        misbranded under section 502 on the basis that the labeling of 
        the drug omits safety information, including contraindications, 
        warnings, precautions, dosing, administration, or other 
        information pertaining to safety, when the omitted safety 
        information is protected by exclusivity under clause (iii) or 
        (iv) of subsection (j)(5)(F), clause (iii) or (iv) of 
        subsection (c)(3)(E), or section 527(a), or by an extension of 
        such exclusivity under section 505A or 505E.
            ``(2) Labeling.--Notwithstanding clauses (iii) and (iv) of 
        subsection (j)(5)(F), clauses (iii) and (iv) of subsection 
        (c)(3)(E), or section 527, the Secretary shall require that the 
        labeling of a drug approved pursuant to an application 
        submitted under subsection (b)(2) or (j) that omits safety 
        information described in paragraph (1) include a statement of 
        any appropriate safety information that the Secretary considers 
        necessary to assure safe use.
            ``(3) Availability and scope of exclusivity.--This 
        subsection does not affect--
                    ``(A) the availability or scope of exclusivity or 
                an extension of exclusivity described in subparagraph 
                (A) or (B) of section 505A(o)(3);
                    ``(B) the question of the eligibility for approval 
                under this section of any application described in 
                subsection (b)(2) or (j) that omits any other aspect of 
                labeling protected by exclusivity under--
                            ``(i) clause (iii) or (iv) of subsection 
                        (j)(5)(F);
                            ``(ii) clause (iii) or (iv) of subsection 
                        (c)(3)(E); or
                            ``(iii) section 527(a); or
                    ``(C) except as expressly provided in paragraphs 
                (1) and (2), the operation of this section or section 
                527.''.

SEC. 353. CONGRESSIONAL REVIEW OF THE FOOD AND DRUG ADMINISTRATION 
              RULEMAKING.

    (a) Congressional Review.--Part I of title 5, United States Code, 
is amended by adding at the end the following:

  ``CHAPTER 10--CONGRESSIONAL REVIEW OF FOOD AND DRUG ADMINISTRATION 
                               RULEMAKING

``Sec.
``920. Applicability.
``921. Congressional review.
``922. Congressional approval procedure for major rules.
``923. Congressional disapproval procedure for nonmajor rules.
``924. Definitions.
``925. Judicial review.
``926. Exemption for monetary policy.
``927. Effective date of certain rules.
``928. Regulatory cut-go requirement.
``929. Review of rules currently in effect.
``Sec. 920. Applicability
    ``This chapter applies in lieu of chapter 8 with respect to the 
Food and Drug Administration.
``Sec. 921. Congressional review
    ``(a)(1)(A) Before a rule may take effect, the Food and Drug 
Administration shall satisfy the requirements of section 928 and shall 
publish in the Federal Register a list of information on which the rule 
is based, including data, scientific and economic studies, and cost-
benefit analyses, and identify how the public can access such 
information online, and shall submit to each House of the Congress and 
to the Comptroller General a report containing--
            ``(i) a copy of the rule;
            ``(ii) a concise general statement relating to the rule;
            ``(iii) a classification of the rule as a major or nonmajor 
        rule, including an explanation of the classification 
        specifically addressing each criteria for a major rule 
        contained within sections 924(2)(A), 924(2)(B), and 924(2)(C);
            ``(iv) a list of any other related regulatory actions 
        intended to implement the same statutory provision or 
        regulatory objective as well as the individual and aggregate 
        economic effects of those actions; and
            ``(v) the proposed effective date of the rule.
    ``(B) On the date of the submission of the report under 
subparagraph (A), the Food and Drug Administration shall submit to the 
Comptroller General and make available to each House of Congress--
            ``(i) a complete copy of the cost-benefit analysis of the 
        rule, if any, including an analysis of any jobs added or lost, 
        differentiating between public and private sector jobs;
            ``(ii) the Food and Drug Administration's actions pursuant 
        to sections 603, 604, 605, 607, and 609 of this title;
            ``(iii) the Food and Drug Administration's actions pursuant 
        to sections 202, 203, 204, and 205 of the Unfunded Mandates 
        Reform Act of 1995; and
            ``(iv) any other relevant information or requirements under 
        any other Act and any relevant Executive orders.
    ``(C) Upon receipt of a report submitted under subparagraph (A), 
each House shall provide copies of the report to the chairman and 
ranking member of each standing committee with jurisdiction under the 
rules of the House of Representatives or the Senate to report a bill to 
amend the provision of law under which the rule is issued.
    ``(2)(A) The Comptroller General shall provide a report on each 
major rule to the committees of jurisdiction by the end of 15 calendar 
days after the submission or publication date. The report of the 
Comptroller General shall include an assessment of the Food and Drug 
Administration's compliance with procedural steps required by paragraph 
(1)(B) and an assessment of whether the major rule imposes any new 
limits or mandates on private-sector activity.
    ``(B) The Food and Drug Administration shall cooperate with the 
Comptroller General by providing information relevant to the 
Comptroller General's report under subparagraph (A).
    ``(3) A major rule relating to a report submitted under paragraph 
(1) shall take effect upon enactment of a joint resolution of approval 
described in section 922 or as provided for in the rule following 
enactment of a joint resolution of approval described in section 922, 
whichever is later.
    ``(4) A nonmajor rule shall take effect as provided by section 923 
after submission to Congress under paragraph (1).
    ``(5) If a joint resolution of approval relating to a major rule is 
not enacted within the period provided in subsection (b)(2), then a 
joint resolution of approval relating to the same rule may not be 
considered under this chapter in the same Congress by either the House 
of Representatives or the Senate.
    ``(b)(1) A major rule shall not take effect unless the Congress 
enacts a joint resolution of approval described under section 922.
    ``(2) If a joint resolution described in subsection (a) is not 
enacted into law by the end of 70 session days or legislative days, as 
applicable, beginning on the date on which the report referred to in 
section 921(a)(1)(A) is received by Congress (excluding days either 
House of Congress is adjourned for more than 3 days during a session of 
Congress), then the rule described in that resolution shall be deemed 
not to be approved and such rule shall not take effect.
    ``(c)(1) Notwithstanding any other provision of this section 
(except subject to paragraph (3)), a major rule may take effect for one 
90-calendar-day period if the President makes a determination under 
paragraph (2) and submits written notice of such determination to the 
Congress.
    ``(2) Paragraph (1) applies to a determination made by the 
President by Executive order that the major rule should take effect 
because such rule is--
            ``(A) necessary because of an imminent threat to health or 
        safety or other emergency;
            ``(B) necessary for the enforcement of criminal laws;
            ``(C) necessary for national security; or
            ``(D) issued pursuant to any statute implementing an 
        international trade agreement.
    ``(3) An exercise by the President of the authority under this 
subsection shall have no effect on the procedures under section 922.
    ``(d)(1) In addition to the opportunity for review otherwise 
provided under this chapter, in the case of any rule for which a report 
was submitted in accordance with subsection (a)(1)(A) during the period 
beginning on the date occurring--
            ``(A) in the case of the Senate, 60 session days; or
            ``(B) in the case of the House of Representatives, 60 
        legislative days,
before the date the Congress is scheduled to adjourn a session of 
Congress through the date on which the same or succeeding Congress 
first convenes its next session, sections 922 and 923 shall apply to 
such rule in the succeeding session of Congress.
    ``(2)(A) In applying sections 922 and 923 for purposes of such 
additional review, a rule described under paragraph (1) shall be 
treated as though--
            ``(i) such rule were published in the Federal Register on--
                    ``(I) in the case of the Senate, the 15th session 
                day; or
                    ``(II) in the case of the House of Representatives, 
                the 15th legislative day,
        after the succeeding session of Congress first convenes; and
            ``(ii) a report on such rule were submitted to Congress 
        under subsection (a)(1) on such date.
    ``(B) Nothing in this paragraph shall be construed to affect the 
requirement under subsection (a)(1) that a report shall be submitted to 
Congress before a rule can take effect.
    ``(3) A rule described under paragraph (1) shall take effect as 
otherwise provided by law (including other subsections of this 
section).
``Sec. 922. Congressional approval procedure for major rules
    ``(a)(1) For purposes of this section, the term `joint resolution' 
means only a joint resolution addressing a report classifying a rule as 
major pursuant to section 921(a)(1)(A)(iii) that--
            ``(A) bears no preamble;
            ``(B) bears the following title (with blanks filled as 
        appropriate): `Approving the rule submitted by ___ relating to 
        ___.';
            ``(C) includes after its resolving clause only the 
        following (with blanks filled as appropriate): `That Congress 
        approves the rule submitted by ___ relating to ___.'; and
            ``(D) is introduced pursuant to paragraph (2).
    ``(2) After a House of Congress receives a report classifying a 
rule as major pursuant to section 921(a)(1)(A)(iii), the majority 
leader of that House (or his or her respective designee) shall 
introduce (by request, if appropriate) a joint resolution described in 
paragraph (1)--
            ``(A) in the case of the House of Representatives, within 3 
        legislative days; and
            ``(B) in the case of the Senate, within 3 session days.
    ``(3) A joint resolution described in paragraph (1) shall not be 
subject to amendment at any stage of proceeding.
    ``(b) A joint resolution described in subsection (a) shall be 
referred in each House of Congress to the committees having 
jurisdiction over the provision of law under which the rule is issued.
    ``(c) In the Senate, if the committee or committees to which a 
joint resolution described in subsection (a) has been referred have not 
reported it at the end of 15 session days after its introduction, such 
committee or committees shall be automatically discharged from further 
consideration of the resolution and it shall be placed on the calendar. 
A vote on final passage of the resolution shall be taken on or before 
the close of the 15th session day after the resolution is reported by 
the committee or committees to which it was referred, or after such 
committee or committees have been discharged from further consideration 
of the resolution.
    ``(d)(1) In the Senate, when the committee or committees to which a 
joint resolution is referred have reported, or when a committee or 
committees are discharged (under subsection (c)) from further 
consideration of a joint resolution described in subsection (a), it is 
at any time thereafter in order (even though a previous motion to the 
same effect has been disagreed to) for a motion to proceed to the 
consideration of the joint resolution, and all points of order against 
the joint resolution (and against consideration of the joint 
resolution) are waived. The motion is not subject to amendment, or to a 
motion to postpone, or to a motion to proceed to the consideration of 
other business. A motion to reconsider the vote by which the motion is 
agreed to or disagreed to shall not be in order. If a motion to proceed 
to the consideration of the joint resolution is agreed to, the joint 
resolution shall remain the unfinished business of the Senate until 
disposed of.
    ``(2) In the Senate, debate on the joint resolution, and on all 
debatable motions and appeals in connection therewith, shall be limited 
to not more than 2 hours, which shall be divided equally between those 
favoring and those opposing the joint resolution. A motion to further 
limit debate is in order and not debatable. An amendment to, or a 
motion to postpone, or a motion to proceed to the consideration of 
other business, or a motion to recommit the joint resolution is not in 
order.
    ``(3) In the Senate, immediately following the conclusion of the 
debate on a joint resolution described in subsection (a), and a single 
quorum call at the conclusion of the debate if requested in accordance 
with the rules of the Senate, the vote on final passage of the joint 
resolution shall occur.
    ``(4) Appeals from the decisions of the Chair relating to the 
application of the rules of the Senate to the procedure relating to a 
joint resolution described in subsection (a) shall be decided without 
debate.
    ``(e) In the House of Representatives, if any committee to which a 
joint resolution described in subsection (a) has been referred has not 
reported it to the House at the end of 15 legislative days after its 
introduction, such committee shall be discharged from further 
consideration of the joint resolution, and it shall be placed on the 
appropriate calendar. On the second and fourth Thursdays of each month 
it shall be in order at any time for the Speaker to recognize a Member 
who favors passage of a joint resolution that has appeared on the 
calendar for at least 5 legislative days to call up that joint 
resolution for immediate consideration in the House without 
intervention of any point of order. When so called up a joint 
resolution shall be considered as read and shall be debatable for 1 
hour equally divided and controlled by the proponent and an opponent, 
and the previous question shall be considered as ordered to its passage 
without intervening motion. It shall not be in order to reconsider the 
vote on passage. If a vote on final passage of the joint resolution has 
not been taken by the third Thursday on which the Speaker may recognize 
a Member under this subsection, such vote shall be taken on that day.
    ``(f)(1) If, before passing a joint resolution described in 
subsection (a), one House receives from the other a joint resolution 
having the same text, then--
            ``(A) the joint resolution of the other House shall not be 
        referred to a committee; and
            ``(B) the procedure in the receiving House shall be the 
        same as if no joint resolution had been received from the other 
        House until the vote on passage, when the joint resolution 
        received from the other House shall supplant the joint 
        resolution of the receiving House.
    ``(2) This subsection shall not apply to the House of 
Representatives if the joint resolution received from the Senate is a 
revenue measure.
    ``(g) If either House has not taken a vote on final passage of the 
joint resolution by the last day of the period described in section 
921(b)(2), then such vote shall be taken on that day.
    ``(h) This section and section 923 are enacted by Congress--
            ``(1) as an exercise of the rulemaking power of the Senate 
        and House of Representatives, respectively, and as such is 
        deemed to be part of the rules of each House, respectively, but 
        applicable only with respect to the procedure to be followed in 
        that House in the case of a joint resolution described in 
        subsection (a) and superseding other rules only where 
        explicitly so; and
            ``(2) with full recognition of the Constitutional right of 
        either House to change the rules (so far as they relate to the 
        procedure of that House) at any time, in the same manner and to 
        the same extent as in the case of any other rule of that House.
``Sec. 923. Congressional disapproval procedure for nonmajor rules
    ``(a) For purposes of this section, the term `joint resolution' 
means only a joint resolution introduced in the period beginning on the 
date on which the report referred to in section 921(a)(1)(A) is 
received by Congress and ending 60 days thereafter (excluding days 
either House of Congress is adjourned for more than 3 days during a 
session of Congress), the matter after the resolving clause of which is 
as follows: `That Congress disapproves the nonmajor rule submitted by 
the ___ relating to ___, and such rule shall have no force or effect.' 
(The blank spaces being appropriately filled in).
    ``(b) A joint resolution described in subsection (a) shall be 
referred to the committees in each House of Congress with jurisdiction.
    ``(c) In the Senate, if the committee to which is referred a joint 
resolution described in subsection (a) has not reported such joint 
resolution (or an identical joint resolution) at the end of 15 session 
days after the date of introduction of the joint resolution, such 
committee may be discharged from further consideration of such joint 
resolution upon a petition supported in writing by 30 Members of the 
Senate, and such joint resolution shall be placed on the calendar.
    ``(d)(1) In the Senate, when the committee to which a joint 
resolution is referred has reported, or when a committee is discharged 
(under subsection (c)) from further consideration of a joint resolution 
described in subsection (a), it is at any time thereafter in order 
(even though a previous motion to the same effect has been disagreed 
to) for a motion to proceed to the consideration of the joint 
resolution, and all points of order against the joint resolution (and 
against consideration of the joint resolution) are waived. The motion 
is not subject to amendment, or to a motion to postpone, or to a motion 
to proceed to the consideration of other business. A motion to 
reconsider the vote by which the motion is agreed to or disagreed to 
shall not be in order. If a motion to proceed to the consideration of 
the joint resolution is agreed to, the joint resolution shall remain 
the unfinished business of the Senate until disposed of.
    ``(2) In the Senate, debate on the joint resolution, and on all 
debatable motions and appeals in connection therewith, shall be limited 
to not more than 10 hours, which shall be divided equally between those 
favoring and those opposing the joint resolution. A motion to further 
limit debate is in order and not debatable. An amendment to, or a 
motion to postpone, or a motion to proceed to the consideration of 
other business, or a motion to recommit the joint resolution is not in 
order.
    ``(3) In the Senate, immediately following the conclusion of the 
debate on a joint resolution described in subsection (a), and a single 
quorum call at the conclusion of the debate if requested in accordance 
with the rules of the Senate, the vote on final passage of the joint 
resolution shall occur.
    ``(4) Appeals from the decisions of the Chair relating to the 
application of the rules of the Senate to the procedure relating to a 
joint resolution described in subsection (a) shall be decided without 
debate.
    ``(e) In the Senate, the procedure specified in subsection (c) or 
(d) shall not apply to the consideration of a joint resolution 
respecting a nonmajor rule--
            ``(1) after the expiration of the 60 session days beginning 
        with the applicable submission or publication date; or
            ``(2) if the report under section 921(a)(1)(A) was 
        submitted during the period referred to in section 921(d)(1), 
        after the expiration of the 60 session days beginning on the 
        15th session day after the succeeding session of Congress first 
        convenes.
    ``(f) If, before the passage by one House of a joint resolution of 
that House described in subsection (a), that House receives from the 
other House a joint resolution described in subsection (a), then the 
following procedures shall apply:
            ``(1) The joint resolution of the other House shall not be 
        referred to a committee.
            ``(2) With respect to a joint resolution described in 
        subsection (a) of the House receiving the joint resolution--
                    ``(A) the procedure in that House shall be the same 
                as if no joint resolution had been received from the 
                other House; but
                    ``(B) the vote on final passage shall be on the 
                joint resolution of the other House.
``Sec. 924. Definitions
    ``For purposes of this chapter:
            ``(1) The term `major rule' means any rule of the Food and 
        Drug Administration, including an interim final rule, that the 
        Administrator of the Office of Information and Regulatory 
        Affairs of the Office of Management and Budget finds has 
        resulted in or is likely to result in--
                    ``(A) an annual cost on the economy of $100,000,000 
                or more, adjusted annually for inflation;
                    ``(B) a major increase in costs or prices for 
                consumers, individual industries, Federal, State, or 
                local government agencies, or geographic regions; or
                    ``(C) significant adverse effects on competition, 
                employment, investment, productivity, innovation, or on 
                the ability of United States-based enterprises to 
                compete with foreign-based enterprises in domestic and 
                export markets.
            ``(2) The term `nonmajor rule' means any rule of the Food 
        and Drug Administration that is not a major rule.
            ``(3) The term `rule' has the meaning given such term in 
        section 551, except that such term does not include--
                    ``(A) any rule of particular applicability;
                    ``(B) any rule relating to agency management or 
                personnel; or
                    ``(C) any rule of agency organization, procedure, 
                or practice that does not substantially affect the 
                rights or obligations of non-agency parties.
            ``(4) The term `submission date or publication date', 
        except as otherwise provided in this chapter, means--
                    ``(A) in the case of a major rule, the date on 
                which the Congress receives the report submitted under 
                section 921(a)(1); and
                    ``(B) in the case of a nonmajor rule, the later 
                of--
                            ``(i) the date on which the Congress 
                        receives the report submitted under section 
                        921(a)(1); and
                            ``(ii) the date on which the nonmajor rule 
                        is published in the Federal Register, if so 
                        published.
``Sec. 925. Judicial review
    ``(a) No determination, finding, action, or omission under this 
chapter shall be subject to judicial review.
    ``(b) Notwithstanding subsection (a), a court may determine whether 
the Food and Drug Administration has completed the necessary 
requirements under this chapter for a rule to take effect.
    ``(c) The enactment of a joint resolution of approval under section 
922 shall not be interpreted to serve as a grant or modification of 
statutory authority by Congress for the promulgation of a rule, shall 
not extinguish or affect any claim, whether substantive or procedural, 
against any alleged defect in a rule, and shall not form part of the 
record before the court in any judicial proceeding concerning a rule 
except for purposes of determining whether or not the rule is in 
effect.
``Sec. 926. Exemption for monetary policy
    ``Nothing in this chapter shall apply to rules that concern 
monetary policy proposed or implemented by the Board of Governors of 
the Federal Reserve System or the Federal Open Market Committee.
``Sec. 927. Effective date of certain rules
    ``Notwithstanding section 921, any rule other than a major rule 
which the Food and Drug Administration for good cause finds (and 
incorporates the finding and a brief statement of reasons therefore in 
the rule issued) that notice and public procedure thereon are 
impracticable, unnecessary, or contrary to the public interest, shall 
take effect at such time as the Food and Drug Administration 
determines.
``Sec. 928. Regulatory cut-go requirement
    ``In making any new rule, the Food and Drug Administration shall 
identify a rule or rules that may be amended or repealed to completely 
offset any annual costs of the new rule to the United States economy. 
Before the new rule may take effect, the Food and Drug Administration 
shall make each such repeal or amendment. In making such an amendment 
or repeal, the Food and Drug Administration shall comply with the 
requirements of subchapter II of chapter 5, but the Food and Drug 
Administration may consolidate proceedings under subchapter II (of 
chapter 5) with proceedings on the new rule.
``Sec. 929. Review of rules currently in effect
    ``(a) Annual Review.--Beginning on the date that is 6 months after 
the date of enactment of this section and annually thereafter for the 9 
years following, the Food and Drug Administration shall designate not 
less than 10 percent of eligible rules made by the Food and Drug 
Administration for review, and shall submit a report including each 
such eligible rule in the same manner as a report under section 
921(a)(1). Section 921, section 922, and section 923 shall apply to 
each such rule, subject to subsection (c) of this section. No eligible 
rule previously designated may be designated again.
    ``(b) Sunset for Eligible Rules Not Extended.--Beginning after the 
date that is 10 years after the date of enactment of this section, if 
Congress has not enacted a joint resolution of approval for that 
eligible rule, that eligible rule shall not continue in effect.
    ``(c) Consolidation; Severability.--In applying sections 921, 922, 
and 923 to eligible rules under this section, the following shall 
apply:
            ``(1) The words `take effect' shall be read as `continue in 
        effect'.
            ``(2) Except as provided in paragraph (3), a single joint 
        resolution of approval shall apply to all eligible rules in a 
        report designated for a year, and the matter after the 
        resolving clause of that joint resolution is as follows: `That 
        Congress approves the rules submitted by the __ for the year 
        __.' (The blank spaces being appropriately filled in).
            ``(3) It shall be in order to consider any amendment that 
        provides for specific conditions on which the approval of a 
        particular eligible rule included in the joint resolution is 
        contingent.
            ``(4) A member of either House may move that a separate 
        joint resolution be required for a specified rule.
    ``(d) Definition.--In this section, the term `eligible rule' means 
a rule that is in effect as of the date of enactment of this 
section.''.
    (b) Budgetary Effects of Rules Subject to Section 922 of Title 5, 
United States Code.--Section 257(b)(2) of the Balanced Budget and 
Emergency Deficit Control Act of 1985 is amended by adding at the end 
the following new subparagraph:
                    ``(E) Budgetary effects of rules subject to section 
                922 of title 5, united states code.--Any rules subject 
                to the congressional approval procedure set forth in 
                section 922 of chapter 8 of title 5, United States 
                Code, affecting budget authority, outlays, or receipts 
                shall be assumed to be effective unless it is not 
                approved in accordance with such section.''.
    (c) Government Accountability Office Study of Rules.--
            (1) In general.--The Comptroller General of the United 
        States shall conduct a study to determine, as of the date of 
        the enactment of this Act--
                    (A) how many rules (as such term is defined in 
                section 924 of title 5, United States Code) of the Food 
                and Drug Administration were in effect;
                    (B) how many major rules (as such term is defined 
                in section 924 of title 5, United States Code) of the 
                Food and Drug Administration were in effect; and
                    (C) the total estimated economic cost imposed by 
                all such rules.
            (2) Report.--Not later than 1 year after the date of the 
        enactment of this Act, the Comptroller General of the United 
        States shall submit a report to Congress that contains the 
        findings of the study conducted under paragraph (1).
    (d) Effective Date.--Subsections (a) and (b), and the amendments 
made by such sections, shall take effect beginning on the date that is 
1 year after the date of enactment of this Act.

SEC. 354. GOVERNMENT ACCOUNTABILITY OFFICE STUDY OF RULES.

    (a) In General.--The Comptroller General of the United States shall 
conduct a study to determine, as of the date of the enactment of this 
Act--
            (1) how many rules (as such term is defined in section 804 
        of title 5, United States Code) were in effect;
            (2) how many major rules (as such term is defined in 
        section 804 of title 5, United States Code) were in effect; and
            (3) the total estimated economic cost imposed by all such 
        rules.
    (b) Report.--Not later than 1 year after the date of the enactment 
of this Act, the Comptroller General of the United States shall submit 
a report to Congress that contains the findings of the study conducted 
under subsection (a).

Subtitle D--Prescription Drug and Pharmacy Benefit Manager Transparency

SEC. 361. PATENT DISCLOSURE REQUIREMENTS.

    (a) In General.--Section 351 of the Public Health Service Act (42 
U.S.C. 262) is amended by adding at the end the following:
    ``(o) Additional Requirements With Respect to Patents.--
            ``(1) Approved application holder listing requirements.--
                    ``(A) In general.--Beginning on the date of 
                enactment of this subsection, within 30 days of 
                approval of an application under subsection (a) or (k), 
                the holder of such approved application shall submit to 
                the Secretary a list of each patent required to be 
                disclosed (as described in paragraph (3)).
                    ``(B) Previously approved or licensed biological 
                products.--
                            ``(i) Products approved under section 351 
                        of the phsa.--Not later than 30 days after the 
                        date of enactment of the Fair Care Act of 2022, 
                        the holder of a biological product license that 
                        was approved under subsection (a) or (k) before 
                        the date of enactment of such Act shall submit 
                        to the Secretary a list of each patent required 
                        to be disclosed (as described in paragraph 
                        (3)).
                            ``(ii) Products approved under section 505 
                        of the ffdca.--Not later than 30 days after 
                        March 23, 2021, the holder of an approved 
                        application for a biological product under 
                        section 505 of the Federal Food, Drug, and 
                        Cosmetic Act that is deemed to be a license for 
                        the biological product under this section on 
                        March 23, 2021, shall submit a list of each 
                        patent required to be disclosed (as described 
                        in paragraph (3)).
                    ``(C) Updates.--The holder of a biological product 
                license approved under subsection (a) or (k) shall 
                submit to the Secretary a list that includes--
                            ``(i) any patent first required to be 
                        disclosed (as described in paragraph (3)) after 
                        the submission under subparagraph (A) or (B), 
                        as applicable, within 30 days of the earlier 
                        of--
                                    ``(I) the date of issuance of such 
                                patent by the United States Patent and 
                                Trademark Office; or
                                    ``(II) the date of approval of a 
                                supplemental application for the 
                                biological product; and
                            ``(ii) any patent, or any claim with 
                        respect to a patent, included on the list 
                        pursuant to this paragraph with respect to the 
                        biological product subsequently determined to 
                        be invalid or unenforceable, within 30 days of 
                        a determination of patent invalidity.
            ``(2) Publication of information.--
                    ``(A) In general.--Within 1 year of the date of 
                enactment of the Fair Care Act of 2022, the Secretary 
                shall publish and make available to the public a 
                single, easily searchable, list that includes--
                            ``(i) the official and proprietary name of 
                        each biological product licensed under 
                        subsection (a) or (k), and of each biological 
                        product application approved under section 505 
                        of the Federal Food, Drug, and Cosmetic Act and 
                        deemed to be a license for the biological 
                        product under this section on March 23, 2021;
                            ``(ii) with respect to each biological 
                        product described in clause (i), each patent 
                        submitted in accordance with paragraph (1);
                            ``(iii) the date of licensure and 
                        application number for each such biological 
                        product;
                            ``(iv) the marketing status, dosage form, 
                        route of administration, strength, and, if 
                        applicable, reference product, for each such 
                        biological product;
                            ``(v) the licensure status for each such 
                        biological product, including whether the 
                        license at the time of listing is approved, 
                        withdrawn, or revoked;
                            ``(vi) any period of any exclusivity under 
                        subsection (k)(7)(A) or subsection (k)(7)(B) of 
                        this section or section 527 of the Federal 
                        Food, Drug, and Cosmetic Act, and any extension 
                        of such period in accordance with subsection 
                        (m) of this section with respect to each such 
                        biological product, and the date on which such 
                        exclusivity expires;
                            ``(vii) information regarding any 
                        determination related to biosimilarity or 
                        interchangeability for each such biological 
                        product; and
                            ``(viii) information regarding approved 
                        indications for each such biological product, 
                        in such manner as the Secretary determines 
                        appropriate.
                    ``(B) Updates.--Every 30 days after the publication 
                of the first list under subparagraph (A), the Secretary 
                shall revise the list to include--
                            ``(i)(I) each biological product licensed 
                        under subsection (a) or (k) during the 30-day 
                        period; and
                            ``(II) with respect to each biological 
                        product described in subclause (I), the 
                        information described in clauses (i) through 
                        (viii) of subparagraph (A); and
                            ``(ii) any updates to information 
                        previously published in accordance with 
                        subparagraph (A).
            ``(3) Patents required to be disclosed.--In this section, a 
        `patent required to be disclosed' is any patent for which the 
        holder of a biological product license approved under 
        subsection (a) or (k), or a biological product application 
        approved under section 505 of the Federal Food, Drug, and 
        Cosmetic Act and deemed to be a license for a biological 
        product under this section on March 23, 2021, believes a claim 
        of patent infringement could reasonably be asserted by the 
        holder, or by a patent owner that has granted an exclusive 
        license to the holder with respect to the biological product 
        that is the subject of such license, if a person not licensed 
        by the holder engaged in the making, using, offering to sell, 
        selling, or importing into the United States of the biological 
        product that is the subject of such license.''.
    (b) Disclosure of Patents.--Section 351(l)(3)(A)(i) of the Public 
Health Service Act (42 U.S.C. 262(l)(3)(A)(i)) is amended by inserting 
``included in the list provided by the reference product sponsor under 
subsection (o)(1)'' after ``a list of patents''.
    (c) Restriction on Claims of Patent Infringement.--Section 271(e) 
of title 35, United States Code, is amended by adding at the end the 
following:
            ``(7) The owner of a patent that should have been included 
        in the list described in section 351(o)(1) of the Public Health 
        Service Act (42 U.S.C. 262(o)(1)), including any updates 
        required under subparagraph (C) of that section, but was not 
        timely included in such list, may not bring an action under 
        this section for infringement of the patent.''.
    (d) Regulations.--The Secretary of Health and Human Services may 
promulgate regulations to carry out subsection (o) of section 351 of 
the Public Health Service Act (42 U.S.C. 262), as added by subsection 
(a).
    (e) Rule of Construction.--Nothing in this Act, including an 
amendment made by this Act, shall be construed to require or allow the 
Secretary of Health and Human Services to delay the licensing of a 
biological product under section 351 of the Public Health Service Act 
(42 U.S.C. 262).

SEC. 362. REQUIREMENTS WITH RESPECT TO PRESCRIPTION DRUG BENEFITS.

    (a) In General.--Subpart II of part A of title XXVII of the Public 
Health Service Act (42 U.S.C. 300gg-11 et seq.) is amended by adding at 
the end the following:

``SEC. 2729A. REQUIREMENTS WITH RESPECT TO PRESCRIPTION DRUG BENEFITS.

    ``A group health plan or a health insurance issuer offering group 
or individual health insurance coverage shall not, and shall ensure 
that any entity that provides pharmacy benefits management services 
under a contract with any such health plan or health insurance coverage 
does not, receive from a drug manufacturer a reduction in price or 
other remuneration with respect to any prescription drug received by an 
enrollee in the plan or coverage and covered by the plan or coverage, 
unless--
            ``(1) any such reduction in price is reflected at the point 
        of sale to the enrollee; and
            ``(2) any such other remuneration is a flat fee-based 
        service fee that a manufacturer of prescription drugs pays to a 
        pharmacy benefit manager for services rendered to the 
        manufacturer that relate to arrangements by the pharmacy 
        benefit manager to provide pharmacy benefit management services 
        to a health plan or health insurance issuer, if certain 
        conditions established by the Secretary are met, including 
        requirements that the fees are transparent to the health plan 
        or health insurance issuer.''.
    (b) Effective Date.--Section 2729A of the Public Health Service 
Act, as added by subsection (a), shall take effect on January 1, 2023.

SEC. 363. PBM TRANSPARENCY AND ELIMINATION OF DIR FEES.

    (a) Prohibiting Medicare PDP Sponsors and MA-PD Organizations From 
Retroactively Reducing Payment on Clean Claims Submitted by 
Pharmacies.--
            (1) In general.--Section 1860D-12(b)(4)(A) of the Social 
        Security Act (42 U.S.C. 1395w-112(b)(4)(A)) is amended by 
        adding at the end the following new clause:
                            ``(iv) Prohibiting retroactive reductions 
                        in payments on clean claims.--Each contract 
                        entered into with a PDP sponsor under this part 
                        with respect to a prescription drug plan 
                        offered by such sponsor shall provide that 
                        after the date of receipt of a clean claim 
                        submitted by a pharmacy, the PDP sponsor (or an 
                        agent of the PDP sponsor) may not retroactively 
                        reduce payment on such claim directly or 
                        indirectly through aggregated effective rate or 
                        otherwise except in the case such claim is 
                        found to not be a clean claim (such as in the 
                        case of a claim lacking required substantiating 
                        documentation) during the course of a routine 
                        audit as permitted pursuant to written 
                        agreement between the PDP sponsor (or such an 
                        agent) and such pharmacy. The previous sentence 
                        shall not prohibit any retroactive increase in 
                        payment to a pharmacy pursuant to a written 
                        agreement between a PDP sponsor (or an agent of 
                        such sponsor) and such pharmacy.''.
            (2) Effective date.--The amendment made by subsection (a) 
        shall apply with respect to contracts entered into on or after 
        January 1, 2023.
    (b) Elimination of DIR Fees.--
            (1) Pharmacy benefits manager standards under the medicare 
        program for prescription drug plans and ma-pd plans.--
                    (A) In general.--Section 1860D-12(b) of the Social 
                Security Act (42 U.S.C. 1395w-112(b)) is amended by 
                adding at the end the following new paragraph:
            ``(7) Pharmacy benefits manager transparency 
        requirements.--Each contract entered into with a PDP sponsor 
        under this part with respect to a prescription drug plan 
        offered by such sponsor or with an MA organization offering an 
        MA-PD plan under part C shall provide that the sponsor or 
        organization, respectively, may not enter into a contract with 
        any pharmacy benefits manager (referred to in this paragraph as 
        a `PBM') to manage the prescription drug coverage provided 
        under such plan, or to control the costs of the prescription 
        drug coverage under such plan, unless the PBM adheres to the 
        following criteria when handling personally identifiable 
        utilization and claims data or other sensitive patient data:
                    ``(A) The PBM may not transmit any personally 
                identifiable utilization, protected health information, 
                or claims data, with respect to a plan enrollee, to a 
                pharmacy owned by a PBM if the plan enrollee has not 
                voluntarily elected in writing or via secure electronic 
                means to fill that particular prescription at the PBM-
                owned pharmacy.
                    ``(B) The PBM may not require that a plan enrollee 
                use a retail pharmacy, mail order pharmacy, specialty 
                pharmacy, or other pharmacy entity providing pharmacy 
                services in which the PBM has an ownership interest or 
                that has an ownership interest in the PBM, or provide 
                an incentive to a plan enrollee to encourage the 
                enrollee to use a retail pharmacy, mail order pharmacy, 
                specialty pharmacy, or other pharmacy entity providing 
                pharmacy services in which the PBM has an ownership 
                interest or that has an ownership interest in the PBM, 
                if the incentive is applicable only to such 
                pharmacies.''.
                    (B) Regular update of prescription drug pricing 
                standard.--Paragraph (6) of section 1860D-12(b) of the 
                Social Security Act (42 U.S.C. 1395w-112(b)) is amended 
                to read as follows:
            ``(6) Regular update of prescription drug pricing 
        standard.--
                    ``(A) In general.--If the PDP sponsor of a 
                prescription drug plan (or MA organization offering an 
                MA-PD plan) uses a standard for reimbursement (as 
                described in subparagraph (B)) of pharmacies based on 
                the cost of a drug, each contract entered into with 
                such sponsor under this part (or organization under 
                part C) with respect to the plan shall provide that the 
                sponsor (or organization) shall--
                            ``(i) update such standard not less 
                        frequently than once every 7 days, beginning 
                        with an initial update on January 1 of each 
                        year, to accurately reflect the market price of 
                        acquiring the drug;
                            ``(ii) disclose to applicable pharmacies 
                        and the contracting entities of such pharmacies 
                        the sources used for making any such update 
                        immediately without requirement of request;
                            ``(iii) if the source for such a standard 
                        for reimbursement is not publicly available, 
                        disclose to the applicable pharmacies and the 
                        respective contracting entities of such 
                        pharmacies all individual drug prices to be so 
                        updated in advance of the use of such prices 
                        for the reimbursement of claims;
                            ``(iv) establish a process to appeal, 
                        investigate, and resolve disputes regarding 
                        individual drug prices that are less than the 
                        pharmacy acquisition price for such drug, which 
                        must be adjudicated within 7 days of the 
                        pharmacy filing its appeal; and
                            ``(v) provide all such pricing data in an 
                        .xml spreadsheet format or a comparable easily 
                        accessible and complete spreadsheet format.
                    ``(B) Prescription drug pricing standard defined.--
                For purposes of subparagraph (A), a standard for 
                reimbursement of a pharmacy is any methodology or 
                formula for varying the pricing of a drug or drugs 
                during the term of the pharmacy reimbursement contract 
                that is based on the cost of the drug involved, 
                including drug pricing references and amounts that are 
                based upon average wholesale price, wholesale average 
                cost, average manufacturer price, average sales price, 
                maximum allowable cost (MAC), or other costs, whether 
                publicly available or not.''.
                    (C) Effective date.--The amendments made by this 
                section shall apply to plan years beginning on or after 
                January 1, 2023.
            (2) Regular update of prescription drug pricing standard 
        under tricare retail pharmacy program.--Section 1074g(d) of 
        title 10, United States Code, is amended by adding at the end 
        the following new paragraph:
    ``(3) To the extent practicable, with respect to the TRICARE retail 
pharmacy program described in subsection (a)(2)(E)(ii), the Secretary 
shall ensure that a contract entered into with a TRICARE managed care 
support contractor includes requirements described in section 1860D-
12(b)(6) of the Social Security Act (42 U.S.C. 1395w-112(b)(6)) to 
ensure the provision of information regarding the pricing standard for 
prescription drugs.''.
            (3) Prescription drug transparency in the federal employees 
        health benefits program.--
                    (A) In general.--Section 8902 of title 5, United 
                States Code, is amended by adding at the end the 
                following new subsections:
    ``(p) A contract may not be made or a plan approved under this 
chapter under which a carrier has an agreement with a pharmacy benefits 
manager (in this subsection referred to as a `PBM') to manage 
prescription drug coverage or to control the costs of the prescription 
drug coverage unless the carrier and PBM adhere to the following 
criteria:
            ``(1) The PBM may not transmit any personally identifiable 
        utilization, protected health information, or claims data with 
        respect to an individual enrolled under such contract or plan 
        to a pharmacy owned by the PBM if the individual has not 
        voluntarily elected in writing or via secure electronic means 
        to fill that particular prescription at such a pharmacy.
            ``(2) The PBM may not require that an individual enrolled 
        under such contract or plan use a retail pharmacy, mail order 
        pharmacy, specialty pharmacy, or other pharmacy entity 
        providing pharmacy services in which the PBM has an ownership 
        interest or that has an ownership interest in the PBM or 
        provide an incentive to a plan enrollee to encourage the 
        enrollee to use a retail pharmacy, mail order pharmacy, 
        specialty pharmacy, or other pharmacy entity providing pharmacy 
        services in which the PBM has an ownership interest or that has 
        an ownership interest in the PBM, if the incentive is 
        applicable only to such pharmacies.
    ``(q)(1) If a contract made or plan approved under this chapter 
provides for a standard for reimbursement (as described in paragraph 
(2)) with respect to a prescription drug plan, such contract or plan 
shall provide that the applicable carrier--
            ``(A) update such standard not less frequently than once 
        every 7 days, beginning with an initial update on January 1 of 
        each year, to accurately reflect the market price of acquiring 
        the drug;
            ``(B) disclose to applicable pharmacies and the contracting 
        entities of such pharmacies the sources used for making any 
        such update immediately without requirement of request;
            ``(C) if the source for such a standard for reimbursement 
        is not publicly available, disclose to the applicable 
        pharmacies and contracting entities of such pharmacies all 
        individual drug prices to be so updated in advance of the use 
        of such prices for the reimbursement of claims;
            ``(D) establish a process to appeal, investigate, and 
        resolve disputes regarding individual drug prices that are less 
        than the pharmacy acquisition price for such drug, which must 
        be adjudicated within 7 days of the pharmacy filing its appeal; 
        and
            ``(E) provide all such pricing data in an .xml spreadsheet 
        format or a comparable easily accessible and complete 
        spreadsheet format.
    ``(2) For purposes of paragraph (1), a standard for reimbursement 
of a pharmacy is any methodology or formula for varying the pricing of 
a drug or drugs during the term of the pharmacy reimbursement contract 
that is based on the cost of the drug involved, including drug pricing 
references and amounts that are based upon average wholesale price, 
wholesale average cost, average manufacturer price, average sales 
price, maximum allowable cost, or other costs, whether publicly 
available or not.''.
                    (B) Application.--The amendment made by 
                subparagraph (A) shall apply to any contract entered 
                into under section 8902 of title 5, United States Code, 
                on or after the date of enactment of this section.

SEC. 364. HEALTH PLAN OVERSIGHT OF PHARMACY BENEFIT MANAGER SERVICES.

    Subpart II of part A of title XXVII of the Public Health Service 
Act (42 U.S.C. 300gg-11 et seq.), as amended by the preceding sections, 
is further amended by adding at the end the following:

``SEC. 2729E. HEALTH PLAN OVERSIGHT OF PHARMACY BENEFIT MANAGER 
              SERVICES.

    ``(a) In General.--A group health plan or health insurance issuer 
offering group health insurance coverage or an entity or subsidiary 
providing pharmacy benefits management services shall not enter into a 
contract with a drug manufacturer, distributor, wholesaler, 
subcontractor, rebate aggregator, or any associated third party that 
limits the disclosure of information to plan sponsors in such a manner 
that prevents the plan or coverage, or an entity or subsidiary 
providing pharmacy benefits management services on behalf of a plan or 
coverage from making the reports described in subsection (b).
    ``(b) Reports to Group Plan Sponsors.--
            ``(1) In general.--Beginning with the first plan year that 
        begins after the date of enactment of the Fair Care Act of 
        2022, not less frequently than once every 6 months, a health 
        insurance issuer offering group health insurance coverage or an 
        entity providing pharmacy benefits management services on 
        behalf of a group health plan shall submit to the plan sponsor 
        (as defined in section 3(16)(B) of the Employee Retirement 
        Income Security Act of 1974) of such group health plan or 
        health insurance coverage a report in accordance with this 
        subsection and make such report available to the plan sponsor 
        in a machine-readable format. Each such report shall include, 
        with respect to the applicable group health plan or health 
        insurance coverage--
                    ``(A) information collected from drug manufacturers 
                by such issuer or entity on the total amount of 
                copayment assistance dollars paid, or copayment cards 
                applied, that were funded by the drug manufacturer with 
                respect to the enrollees in such plan or coverage;
                    ``(B) a list of each covered drug dispensed during 
                the reporting period, including, with respect to each 
                such drug during the reporting period--
                            ``(i) the brand name, chemical entity, and 
                        National Drug Code;
                            ``(ii) the number of enrollees for whom the 
                        drug was filled during the plan year, the total 
                        number of prescription fills for the drug 
                        (including original prescriptions and refills), 
                        and the total number of dosage units of the 
                        drug dispensed across the plan year, including 
                        whether the dispensing channel was by retail, 
                        mail order, or specialty pharmacy;
                            ``(iii) the wholesale acquisition cost, 
                        listed as cost per days supply and cost per 
                        pill, or in the case of a drug in another form, 
                        per dose;
                            ``(iv) the total out-of-pocket spending by 
                        enrollees on such drug, including enrollee 
                        spending through copayments, coinsurance, and 
                        deductibles; and
                            ``(v) for any drug for which gross spending 
                        of the group health plan or health insurance 
                        coverage exceeded $10,000 during the reporting 
                        period--
                                    ``(I) a list of all other available 
                                drugs in the same therapeutic category 
                                or class, including brand name drugs 
                                and biological products and generic 
                                drugs or biosimilar biological products 
                                that are in the same therapeutic 
                                category or class; and
                                    ``(II) the rationale for preferred 
                                formulary placement of a particular 
                                drug or drugs in that therapeutic 
                                category or class;
                    ``(C) a list of each therapeutic category or class 
                of drugs that were dispensed under the health plan or 
                health insurance coverage during the reporting period, 
                and, with respect to each such therapeutic category or 
                class of drugs, during the reporting period--
                            ``(i) total gross spending by the plan, 
                        before manufacturer rebates, fees, or other 
                        manufacturer remuneration;
                            ``(ii) the number of enrollees who filled a 
                        prescription for a drug in that category or 
                        class;
                            ``(iii) if applicable to that category or 
                        class, a description of the formulary tiers and 
                        utilization mechanisms (such as prior 
                        authorization or step therapy) employed for 
                        drugs in that category or class;
                            ``(iv) the total out-of-pocket spending by 
                        enrollees, including enrollee spending through 
                        copayments, coinsurance, and deductibles; and
                            ``(v) for each therapeutic category or 
                        class under which 3 or more drugs are included 
                        on the formulary of such plan or coverage--
                                    ``(I) the amount received, or 
                                expected to be received, from drug 
                                manufacturers in rebates, fees, 
                                alternative discounts, or other 
                                remuneration--
                                            ``(aa) to be paid by drug 
                                        manufacturers for claims 
                                        incurred during the reporting 
                                        period; or
                                            ``(bb) that is related to 
                                        utilization of drugs, in such 
                                        therapeutic category or class;
                                    ``(II) the total net spending, 
                                after deducting rebates, price 
                                concessions, alternative discounts or 
                                other remuneration from drug 
                                manufacturers, by the health plan or 
                                health insurance coverage on that 
                                category or class of drugs; and
                                    ``(III) the net price per course of 
                                treatment or 30-day supply incurred by 
                                the health plan or health insurance 
                                coverage and its enrollees, after 
                                manufacturer rebates, fees, and other 
                                remuneration for drugs dispensed within 
                                such therapeutic category or class 
                                during the reporting period;
                    ``(D) total gross spending on prescription drugs by 
                the plan or coverage during the reporting period, 
                before rebates and other manufacturer fees or 
                remuneration;
                    ``(E) total amount received, or expected to be 
                received, by the health plan or health insurance 
                coverage in drug manufacturer rebates, fees, 
                alternative discounts, and all other remuneration 
                received from the manufacturer or any third party, 
                other than the plan sponsor, related to utilization of 
                drug or drug spending under that health plan or health 
                insurance coverage during the reporting period;
                    ``(F) the total net spending on prescription drugs 
                by the health plan or health insurance coverage during 
                the reporting period; and
                    ``(G) amounts paid directly or indirectly in 
                rebates, fees, or any other type of remuneration to 
                brokers, consultants, advisors, or any other individual 
                or firm who referred the group health plan's or health 
                insurance issuer's business to the pharmacy benefit 
                manager.
            ``(2) Privacy requirements.--Health insurance issuers 
        offering group health insurance coverage and entities providing 
        pharmacy benefits management services on behalf of a group 
        health plan shall provide information under paragraph (1) in a 
        manner consistent with the privacy, security, and breach 
        notification regulations promulgated under section 264(c) of 
        the Health Insurance Portability and Accountability Act of 1996 
        (or successor regulations), and shall restrict the use and 
        disclosure of such information according to such privacy 
        regulations.
            ``(3) Disclosure and redisclosure.--
                    ``(A) Limitation to business associates.--A group 
                health plan receiving a report under paragraph (1) may 
                disclose such information only to business associates 
                of such plan as defined in section 160.103 of title 45, 
                Code of Federal Regulations (or successor regulations).
                    ``(B) Clarification regarding public disclosure of 
                information.--Nothing in this section prevents a health 
                insurance issuer offering group health insurance 
                coverage or an entity providing pharmacy benefits 
                management services on behalf of a group health plan 
                from placing reasonable restrictions on the public 
                disclosure of the information contained in a report 
                described in paragraph (1), except that such issuer or 
                entity may not restrict disclosure of such report to 
                governmental agencies pursuant to an investigation or 
                enforcement action.
                    ``(C) Limited form of report.--The Secretary shall 
                define through rulemaking a limited form of the report 
                under paragraph (1) required of plan sponsors who are 
                drug manufacturers, drug wholesalers, or other direct 
                participants in the drug supply chain, in order to 
                prevent anti-competitive behavior.
    ``(c) Limitations on Spread Pricing.--
            ``(1) Prescription drug transactions with pharmacies 
        independent of the issuer or pharmacy benefits manager.--If the 
        pharmacy that dispenses a prescription drug to an enrollee in a 
        group health plan or group or individual health insurance 
        coverage is not wholly or partially owned by such plan, such 
        issuer, or an entity providing pharmacy benefit management 
        services under such plan or coverage, such plan, issuer, or 
        entity shall not charge the plan, issuer, or enrollee a price 
        for such prescription drug that exceeds the price paid to the 
        pharmacy.
            ``(2) Intra-company prescription drug transactions.--If the 
        mail order, specialty, or retail pharmacy that dispenses a 
        prescription drug to an enrollee in a group health plan or 
        health insurance coverage is wholly or partially owned by, and 
        submits claims to, such health insurance issuer or an entity 
        providing pharmacy benefit management services under a group 
        health plan or group or individual health insurance coverage, 
        the price charged for such drug by such pharmacy to such group 
        health plan or health insurance issuer offering group or 
        individual health insurance coverage may not exceed the lesser 
        of--
                    ``(A) the amount paid to the pharmacy for 
                acquisition of the drug; or
                    ``(B) the median price charged to the group health 
                plan or health insurance issuer when the same drug is 
                dispensed to enrollees in the plan or coverage by other 
                similarly situated pharmacies not wholly or partially 
                owned by the health insurance issuer or entity 
                providing pharmacy benefits management services, as 
                described in paragraph (1).
            ``(3) Supplementary reporting for intra-company 
        prescription drug transactions.--A health insurance issuer of 
        group health insurance coverage or an entity providing pharmacy 
        benefits management services under a group health plan or group 
        health insurance coverage that conducts transactions with a 
        wholly or partially owned pharmacy, as described in paragraph 
        (2), shall submit, together with the report under subsection 
        (b), a supplementary report every 6 months to the plan sponsor 
        that includes--
                    ``(A) an explanation of any benefit design 
                parameters that encourage enrollees in the plan or 
                coverage to fill prescriptions at mail order, 
                specialty, or retail pharmacies that are wholly or 
                partially owned by that issuer or entity;
                    ``(B) the percentage of total prescriptions charged 
                to the plan, coverage, or enrollees in the plan or 
                coverage, that were dispensed by mail order, specialty, 
                or retail pharmacies that are wholly or partially owned 
                by the issuer or entity providing pharmacy benefits 
                management services; and
                    ``(C) a list of all drugs dispensed by such wholly 
                or partially owned pharmacy and charged to the plan or 
                coverage, or enrollees of the plan or coverage, during 
                the applicable quarter, and, with respect to each 
                drug--
                            ``(i) the amount charged per course of 
                        treatment or 30-day supply with respect to 
                        enrollees in the plan or coverage, including 
                        amounts charged to the plan or coverage and 
                        amounts charged to the enrollee;
                            ``(ii) the median amount charged to the 
                        plan or coverage, per course of treatment or 
                        30-day supply, including amounts paid by the 
                        enrollee, when the same drug is dispensed by 
                        other pharmacies that are not wholly or 
                        partially owned by the issuer or entity and 
                        that are included in the pharmacy network of 
                        that plan or coverage;
                            ``(iii) the interquartile range of the 
                        costs, per course of treatment or 30-day 
                        supply, including amounts paid by the enrollee, 
                        when the same drug is dispensed by other 
                        pharmacies that are not wholly or partially 
                        owned by the issuer or entity and that are 
                        included in the pharmacy network of that plan 
                        or coverage; and
                            ``(iv) the lowest cost per course of 
                        treatment or 30-day supply, for such drug, 
                        including amounts charged to the plan or issuer 
                        and enrollee, that is available from any 
                        pharmacy included in the network of the plan or 
                        coverage.
    ``(d) Full Rebate Pass-Through to Plan.--
            ``(1) In general.--A pharmacy benefits manager, a third-
        party administrator of a group health plan, a health insurance 
        issuer offering group health insurance coverage, or an entity 
        providing pharmacy benefits management services under such 
        health plan or health insurance coverage shall remit 100 
        percent of rebates, fees, alternative discounts, and all other 
        remuneration received from a pharmaceutical manufacturer, 
        distributor or any other third party, that are related to 
        utilization of drugs under such health plan or health insurance 
        coverage, to the group health plan.
            ``(2) Form and manner of remittance.--Such rebates, fees, 
        alternative discounts, and other remuneration shall be--
                    ``(A) remitted to the group health plan in a timely 
                fashion after the period for which such rebates, fees, 
                or other remuneration is calculated, and in no case 
                later than 90 days after the end of such period;
                    ``(B) fully disclosed and enumerated to the group 
                health plan sponsor, as described in (b)(1);
                    ``(C) available for audit by the plan sponsor, or a 
                third party designated by a plan sponsor no less than 
                once per plan year; and
                    ``(D) returned to the issuer or entity providing 
                pharmaceutical benefit management services by the group 
                health plan if audits by such issuer or entity indicate 
                that the amounts received are incorrect after such 
                amounts have been paid to the group health plan.
            ``(3) Audit of rebate contracts.--A pharmacy benefits 
        manager, a third-party administrator of a group health plan, a 
        health insurance issuer offering group health insurance 
        coverage, or an entity providing pharmacy benefits management 
        services under such health plan or health insurance coverage 
        shall make rebate contracts with drug manufacturers available 
        for audit by such plan sponsor or designated third party, 
        subject to confidentiality agreements to prevent re-disclosure 
        of such contracts.
    ``(e) Enforcement.--
            ``(1) In general.--The Secretary, in consultation with the 
        Secretary of Labor and the Secretary of the Treasury, shall 
        enforce this section.
            ``(2) Failure to provide timely information.--A health 
        insurance issuer or an entity providing pharmacy benefit 
        management services that violates subsection (a), fails to 
        provide information required under subsection (b), engages in 
        spread pricing as defined in subsection (c), or fails to comply 
        with the requirements of subsection (d), or a drug manufacturer 
        that fails to provide information under subsection (b)(1)(A), 
        in a timely manner shall be subject to a civil monetary penalty 
        in the amount of $10,000 for each day during which such 
        violation continues or such information is not disclosed or 
        reported.
            ``(3) False information.--A health insurance issuer, entity 
        providing pharmacy benefit management services, or drug 
        manufacturer that knowingly provides false information under 
        this section shall be subject to a civil money penalty in an 
        amount not to exceed $100,000 for each item of false 
        information. Such civil money penalty shall be in addition to 
        other penalties as may be prescribed by law.
            ``(4) Procedure.--The provisions of section 1128A of the 
        Social Security Act, other than subsection (a) and (b) and the 
        first sentence of subsection (c)(1) of such section shall apply 
        to civil monetary penalties under this subsection in the same 
        manner as such provisions apply to a penalty or proceeding 
        under section 1128A of the Social Security Act.
            ``(5) Safe harbor.--The Secretary may waive penalties under 
        paragraph (2), or extend the period of time for compliance with 
        a requirement of this section, for an entity in violation of 
        this section that has made a good-faith effort to comply with 
        this section.
    ``(f) Rule of Construction.--Nothing in this section shall be 
construed to prohibit payments to entities offering pharmacy benefits 
management services for bona fide services using a fee structure not 
contemplated by this section, provided that such fees are transparent 
to group health plans and health insurance issuers.
    ``(g) Definitions.--In this section--
            ``(1) the term `similarly situated pharmacy' means, with 
        respect to a particular pharmacy, another pharmacy that is 
        approximately the same size (as measured by the number of 
        prescription drugs dispensed), and that serves patients in the 
        same geographical area, whether through physical locations or 
        mail order; and
            ``(2) the term `wholesale acquisition cost' has the meaning 
        given such term in section 1847A(c)(6)(B) of the Social 
        Security Act.''.

SEC. 365. STUDY BY COMPTROLLER GENERAL OF UNITED STATES.

    (a) In General.--The Comptroller General of the United States 
(referred to in this section as the ``Comptroller General'') shall, in 
consultation with appropriate stakeholders, conduct a study on the role 
of pharmacy benefit managers.
    (b) Permissible Examination.--In conducting the study required 
under subsection (a), the Comptroller General may examine various 
qualitative and quantitative aspects of the role of pharmacy benefit 
managers, such as the following:
            (1) The role that pharmacy benefit managers play in the 
        pharmaceutical supply chain.
            (2) The state of competition among pharmacy benefit 
        managers, including the market share for the Nation's largest 
        pharmacy benefit managers.
            (3) The use of rebates and fees by pharmacy benefit 
        managers, including--
                    (A) the extent to which rebates are passed on to 
                health plans and whether such rebates are passed on to 
                individuals enrolled in such plans;
                    (B) the extent to which rebates are kept by such 
                pharmacy benefit managers; and
                    (C) the role of any fees charged by such pharmacy 
                benefit managers.
            (4) Whether pharmacy benefit managers structure their 
        formularies in favor of high-rebate prescription drugs over 
        lower-cost, lower-rebate alternatives.
            (5) The average prior authorization approval time for 
        pharmacy benefit managers.
            (6) Factors affecting the use of step therapy by pharmacy 
        benefit managers.
    (c) Report.--Not later than 3 years after the date of enactment of 
this Act, the Comptroller General shall submit to the Secretary of 
Health and Human Services, 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 containing the results of the 
study conducted under subsection (a), including policy recommendations.

      Subtitle E--Medicare and Medicaid Prescription Drug Reforms

SEC. 371. MEDICARE PART D MODERNIZATION REDESIGN.

    (a) Benefit Structure Redesign.--Section 1860D-2(b) of the Social 
Security Act (42 U.S.C. 1395w-102(b)) is amended--
            (1) in paragraph (2)--
                    (A) in subparagraph (A), in the matter preceding 
                clause (i), by inserting ``for a year preceding 2023 
                and for costs above the annual deductible specified in 
                paragraph (1) and up to the annual out-of-pocket 
                threshold specified in paragraph (4)(B) for 2023 and 
                each subsequent year'' after ``paragraph (3)'';
                    (B) in subparagraph (C)--
                            (i) in clause (i), in the matter preceding 
                        subclause (I), by inserting ``for a year 
                        preceding 2023,'' after ``paragraph (4),''; and
                            (ii) in clause (ii)(III), by striking ``and 
                        each subsequent year'' and inserting ``, 2021, 
                        and 2022''; and
                    (C) in subparagraph (D)--
                            (i) in clause (i)--
                                    (I) in the matter preceding 
                                subclause (I), by inserting ``for a 
                                year preceding 2023,'' after 
                                ``paragraph (4),''; and
                                    (II) in subclause (I)(bb), by 
                                striking ``a year after 2018'' and 
                                inserting ``each of years 2018 through 
                                2022''; and
                            (ii) in clause (ii)(V), by striking ``2019 
                        and each subsequent year'' and inserting ``each 
                        of years 2019 through 2022'';
            (2) in paragraph (3)(A)--
                    (A) in the matter preceding clause (i), by 
                inserting ``for a year preceding 2023,'' after ``and 
                (4),''; and
                    (B) in clause (ii), by striking ``for a subsequent 
                year'' and inserting ``for each of years 2007 through 
                2022'';
            (3) in paragraph (4)--
                    (A) in subparagraph (A)--
                            (i) in clause (i)--
                                    (I) by redesignating subclauses (I) 
                                and (II) as items (aa) and (bb), 
                                respectively, and indenting 
                                appropriately;
                                    (II) in the matter preceding item 
                                (aa), as redesignated by subclause (I), 
                                by striking ``is equal to the greater 
                                of--'' and inserting ``is equal to--
                                    ``(I) for a year preceding 2023, 
                                the greater of--'';
                                    (III) by striking the period at the 
                                end of item (bb), as redesignated by 
                                subclause (I), and inserting ``; and''; 
                                and
                                    (IV) by adding at the end the 
                                following:
                                    ``(II) for 2023 and each succeeding 
                                year, $0.''; and
                            (ii) in clause (ii)--
                                    (I) by striking ``clause (i)(I)'' 
                                and inserting ``clause (i)(I)(aa)''; 
                                and
                                    (II) by adding at the end the 
                                following new sentence: ``The Secretary 
                                shall continue to calculate the dollar 
                                amounts specified in clause (i)(I)(aa), 
                                including with the adjustment under 
                                this clause, after 2022 for purposes of 
                                section 1860D-14(a)(1)(D)(iii).'';
                    (B) in subparagraph (B)--
                            (i) in clause (i)--
                                    (I) in subclause (V), by striking 
                                ``or'' at the end;
                                    (II) in subclause (VI)--
                                            (aa) by striking ``for a 
                                        subsequent year'' and inserting 
                                        ``for 2021 and 2022''; and
                                            (bb) by striking the period 
                                        at the end and inserting a 
                                        semicolon; and
                                    (III) by adding at the end the 
                                following new subclauses:
                                    ``(VII) for 2023, is equal to 
                                $3,100; or
                                    ``(VIII) for a subsequent year, is 
                                equal to the amount specified in this 
                                subparagraph for the previous year, 
                                increased by the annual percentage 
                                increase described in paragraph (6) for 
                                the year involved.''; and
                            (ii) in clause (ii), by striking ``clause 
                        (i)(II)'' and inserting ``clause (i)'';
                    (C) in subparagraph (C)(i), by striking ``and for 
                amounts'' and inserting ``and for a year preceding 2023 
                for amounts''; and
                    (D) in subparagraph (E), by striking ``In 
                applying'' and inserting ``For each of 2011 through 
                2022, in applying''.
    (b) Reduction in Beneficiary Coinsurance.--
            (1) In general.--Section 1860D-2(b)(2)(A) of the Social 
        Security Act (42 U.S.C. 1395w-102(b)(2)(A)), as amended by 
        subsection (a), is amended--
                    (A) by redesignating clauses (i) and (ii) as 
                subclauses (I) and (II) and moving such subclauses 2 
                ems to the right;
                    (B) by striking ``25 percent coinsurance.--Subject 
                to'' and inserting ``Coinsurance.--
                            ``(i) In general.--Subject to'';
                    (C) in each of subclauses (I) and (II), as 
                redesignated by subparagraph (A), by striking ``25 
                percent'' and inserting ``the applicable percentage (as 
                defined in clause (ii))''; and
                    (D) by adding at the end the following new clause:
                            ``(ii) Applicable percentage defined.--For 
                        purposes of clause (i), the term `applicable 
                        percentage' means--
                                    ``(I) for a year preceding 2023, 25 
                                percent; and
                                    ``(II) for 2023 and each subsequent 
                                year, 20 percent.''.
            (2) Conforming amendment.--Section 1860D-14(a)(2)(D) of the 
        Social Security Act (42 U.S.C. 1395w-114(a)(2)(D)) is amended 
        by striking ``25 percent'' and inserting ``the applicable 
        percentage''.
    (c) Decreasing Reinsurance Payment Amount.--Section 1860D-15(b) of 
the Social Security Act (42 U.S.C. 1395w-115(b)) is amended--
            (1) in paragraph (1)--
                    (A) by striking ``equal to 80 percent'' and 
                inserting ``equal to--
                    ``(A) for a year preceding 2023, 80 percent'';
                    (B) in subparagraph (A), as added by paragraph (1), 
                by striking the period at the end and inserting ``; 
                and''; and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(B) for 2023 and each subsequent year, the sum 
                of--
                            ``(i) an amount equal to the applicable 
                        percentage specified in paragraph (5)(A) of 
                        such allowable reinsurance costs attributable 
                        to that portion of gross prescription drug 
                        costs as specified in paragraph (3) incurred in 
                        the coverage year after such individual has 
                        incurred costs that exceed the annual out-of-
                        pocket threshold specified in section 1860D-
                        2(b)(4)(B) with respect to applicable drugs (as 
                        defined in section 1860D-14B(g)(2)); and
                            ``(ii) an amount equal to the applicable 
                        percentage specified in paragraph (5)(B) of 
                        allowable reinsurance costs attributable to 
                        that portion of gross prescription drug costs 
                        as specified in paragraph (3) incurred in the 
                        coverage year after such individual has 
                        incurred costs that exceed the annual out-of-
                        pocket threshold specified in section 1860D-
                        2(b)(4)(B) with respect to covered part D drugs 
                        that are not applicable drugs (as so 
                        defined).''; and
            (2) by adding at the end the following new paragraph:
            ``(5) Applicable percentage specified.--For purposes of 
        paragraph (1)(B), the applicable percentage specified in this 
        paragraph is--
                    ``(A) with respect to applicable drugs (as defined 
                in section 1860D-14B(g)(2))--
                            ``(i) for 2023, 60 percent;
                            ``(ii) for 2024, 40 percent; and
                            ``(iii) for 2025 and each subsequent year, 
                        20 percent; and
                    ``(B) with respect to covered part D drugs that are 
                not applicable drugs (as so defined)--
                            ``(i) for 2023, 80 percent;
                            ``(ii) for 2024, 60 percent; and
                            ``(iii) for 2025 and each subsequent year, 
                        40 percent.''.
    (d) Manufacturer Discount Program During Initial and Catastrophic 
Phases of Coverage.--
            (1) In general.--Part D of title XVIII of the Social 
        Security Act is amended by inserting after section 1860D-14A 
        (42 U.S.C. 1495w-114) the following new section:

``SEC. 1860D-14B. MANUFACTURER DISCOUNT PROGRAM.

    ``(a) Establishment.--The Secretary shall establish a manufacturer 
discount program (in this section referred to as the `program'). Under 
the program, the Secretary shall enter into agreements described in 
subsection (b) with manufacturers and provide for the performance of 
the duties described in subsection (c). The Secretary shall establish a 
model agreement for use under the program by not later than January 1, 
2022, in consultation with manufacturers, and allow for comment on such 
model agreement.
    ``(b) Terms of Agreement.--
            ``(1) In general.--
                    ``(A) Agreement.--An agreement under this section 
                shall require the manufacturer to provide applicable 
                beneficiaries access to discounted prices for 
                applicable drugs of the manufacturer that are dispensed 
                on or after January 1, 2023.
                    ``(B) Provision of discounted prices at the point-
                of-sale.--The discounted prices described in 
                subparagraph (A) shall be provided to the applicable 
                beneficiary at the pharmacy or by the mail order 
                service at the point-of-sale of an applicable drug.
            ``(2) Provision of appropriate data.--Each manufacturer 
        with an agreement in effect under this section shall collect 
        and have available appropriate data, as determined by the 
        Secretary, to ensure that it can demonstrate to the Secretary 
        compliance with the requirements under the program.
            ``(3) Compliance with requirements for administration of 
        program.--Each manufacturer with an agreement in effect under 
        this section shall comply with requirements imposed by the 
        Secretary or a third party with a contract under subsection 
        (d)(3), as applicable, for purposes of administering the 
        program, including any determination under subparagraph (A) of 
        subsection (c)(1) or procedures established under such 
        subsection (c)(1).
            ``(4) Length of agreement.--
                    ``(A) In general.--An agreement under this section 
                shall be effective for an initial period of not less 
                than 12 months and shall be automatically renewed for a 
                period of not less than 1 year unless terminated under 
                subparagraph (B).
                    ``(B) Termination.--
                            ``(i) By the secretary.--The Secretary may 
                        provide for termination of an agreement under 
                        this section for a knowing and willful 
                        violation of the requirements of the agreement 
                        or other good cause shown. Such termination 
                        shall not be effective earlier than 30 days 
                        after the date of notice to the manufacturer of 
                        such termination. The Secretary shall provide, 
                        upon request, a manufacturer with a hearing 
                        concerning such a termination, and such hearing 
                        shall take place prior to the effective date of 
                        the termination with sufficient time for such 
                        effective date to be repealed if the Secretary 
                        determines appropriate.
                            ``(ii) By a manufacturer.--A manufacturer 
                        may terminate an agreement under this section 
                        for any reason. Any such termination shall be 
                        effective, with respect to a plan year--
                                    ``(I) if the termination occurs 
                                before January 30 of a plan year, as of 
                                the day after the end of the plan year; 
                                and
                                    ``(II) if the termination occurs on 
                                or after January 30 of a plan year, as 
                                of the day after the end of the 
                                succeeding plan year.
                            ``(iii) Effectiveness of termination.--Any 
                        termination under this subparagraph shall not 
                        affect discounts for applicable drugs of the 
                        manufacturer that are due under the agreement 
                        before the effective date of its termination.
                            ``(iv) Notice to third party.--The 
                        Secretary shall provide notice of such 
                        termination to a third party with a contract 
                        under subsection (d)(3) within not less than 30 
                        days before the effective date of such 
                        termination.
            ``(5) Effective date of agreement.--An agreement under this 
        section shall take effect on a date determined appropriate by 
        the Secretary, which may be at the start of a calendar quarter.
    ``(c) Duties Described.--The duties described in this subsection 
are the following:
            ``(1) Administration of program.--Administering the 
        program, including--
                    ``(A) the determination of the amount of the 
                discounted price of an applicable drug of a 
                manufacturer;
                    ``(B) the establishment of procedures under which 
                discounted prices are provided to applicable 
                beneficiaries at pharmacies or by mail order service at 
                the point-of-sale of an applicable drug;
                    ``(C) the establishment of procedures to ensure 
                that, not later than the applicable number of calendar 
                days after the dispensing of an applicable drug by a 
                pharmacy or mail order service, the pharmacy or mail 
                order service is reimbursed for an amount equal to the 
                difference between--
                            ``(i) the negotiated price of the 
                        applicable drug; and
                            ``(ii) the discounted price of the 
                        applicable drug;
                    ``(D) the establishment of procedures to ensure 
                that the discounted price for an applicable drug under 
                this section is applied before any coverage or 
                financial assistance under other health benefit plans 
                or programs that provide coverage or financial 
                assistance for the purchase or provision of 
                prescription drug coverage on behalf of applicable 
                beneficiaries as the Secretary may specify; and
                    ``(E) providing a reasonable dispute resolution 
                mechanism to resolve disagreements between 
                manufacturers, applicable beneficiaries, and the third 
                party with a contract under subsection (d)(3).
            ``(2) Monitoring compliance.--
                    ``(A) In general.--The Secretary shall monitor 
                compliance by a manufacturer with the terms of an 
                agreement under this section.
                    ``(B) Notification.--If a third party with a 
                contract under subsection (d)(3) determines that the 
                manufacturer is not in compliance with such agreement, 
                the third party shall notify the Secretary of such 
                noncompliance for appropriate enforcement under 
                subsection (e).
            ``(3) Collection of data from prescription drug plans and 
        ma-pd plans.--The Secretary may collect appropriate data from 
        prescription drug plans and MA-PD plans in a timeframe that 
        allows for discounted prices to be provided for applicable 
        drugs under this section.
    ``(d) Administration.--
            ``(1) In general.--Subject to paragraph (2), the Secretary 
        shall provide for the implementation of this section, including 
        the performance of the duties described in subsection (c).
            ``(2) Limitation.--In providing for the implementation of 
        this section, the Secretary shall not receive or distribute any 
        funds of a manufacturer under the program.
            ``(3) Contract with third parties.--The Secretary shall 
        enter into a contract with 1 or more third parties to 
        administer the requirements established by the Secretary in 
        order to carry out this section. At a minimum, the contract 
        with a third party under the preceding sentence shall require 
        that the third party--
                    ``(A) receive and transmit information between the 
                Secretary, manufacturers, and other individuals or 
                entities the Secretary determines appropriate;
                    ``(B) receive, distribute, or facilitate the 
                distribution of funds of manufacturers to appropriate 
                individuals or entities in order to meet the 
                obligations of manufacturers under agreements under 
                this section;
                    ``(C) provide adequate and timely information to 
                manufacturers, consistent with the agreement with the 
                manufacturer under this section, as necessary for the 
                manufacturer to fulfill its obligations under this 
                section; and
                    ``(D) permit manufacturers to conduct periodic 
                audits, directly or through contracts, of the data and 
                information used by the third party to determine 
                discounts for applicable drugs of the manufacturer 
                under the program.
            ``(4) Performance requirements.--The Secretary shall 
        establish performance requirements for a third party with a 
        contract under paragraph (3) and safeguards to protect the 
        independence and integrity of the activities carried out by the 
        third party under the program under this section.
            ``(5) Administration.--Chapter 35 of title 44, United 
        States Code, shall not apply to the program under this section.
            ``(6) Funding.--For purposes of carrying out this section, 
        the Secretary shall provide for the transfer, from the Federal 
        Supplementary Medical Insurance Trust Fund under section 1841 
        to the Centers for Medicare & Medicaid Services Program 
        Management Account, of $4,000,000 for each of fiscal years 2020 
        through 2023, to remain available until expended.''.
    ``(e) Enforcement.--
            ``(1) Audits.--Each manufacturer with an agreement in 
        effect under this section shall be subject to periodic audit by 
        the Secretary.
            ``(2) Civil money penalty.--
                    ``(A) In general.--The Secretary shall impose a 
                civil money penalty on a manufacturer that fails to 
                provide applicable beneficiaries discounts for 
                applicable drugs of the manufacturer in accordance with 
                such agreement for each such failure in an amount the 
                Secretary determines is commensurate with the sum of--
                            ``(i) the amount that the manufacturer 
                        would have paid with respect to such discounts 
                        under the agreement, which will then be used to 
                        pay the discounts which the manufacturer had 
                        failed to provide; and
                            ``(ii) 25 percent of such amount.
                    ``(B) Application.--The provisions of section 1128A 
                (other than subsections (a) and (b)) shall apply to a 
                civil money penalty under this paragraph in the same 
                manner as such provisions apply to a penalty or 
                proceeding under section 1128A(a).
    ``(f) Clarification Regarding Availability of Other Covered Part D 
Drugs.--Nothing in this section shall prevent an applicable beneficiary 
from purchasing a covered part D drug that is not an applicable drug 
(including a generic drug or a drug that is not on the formulary of the 
prescription drug plan or MA-PD plan that the applicable beneficiary is 
enrolled in).
    ``(g) Definitions.--In this section:
            ``(1) Applicable beneficiary.--The term `applicable 
        beneficiary' means an individual who, on the date of dispensing 
        a covered part D drug--
                    ``(A) is enrolled in a prescription drug plan or an 
                MA-PD plan;
                    ``(B) is not enrolled in a qualified retiree 
                prescription drug plan; and
                    ``(C) has incurred costs for covered part D drugs 
                in the year that are above the annual deductible 
                specified in section 1860D-2(b)(1) for such year.
            ``(2) Applicable drug.--The term `applicable drug' means, 
        with respect to an applicable beneficiary, a covered part D 
        drug--
                    ``(A) approved under a new drug application under 
                section 505(c) of the Federal Food, Drug, and Cosmetic 
                Act or, in the case of a biologic product, licensed 
                under section 351 of the Public Health Service Act 
                (including a product licensed under subsection (k) of 
                such section 351); and
                    ``(B)(i) if the PDP sponsor of the prescription 
                drug plan or the MA organization offering the MA-PD 
                plan uses a formulary, which is on the formulary of the 
                prescription drug plan or MA-PD plan that the 
                applicable beneficiary is enrolled in;
                    ``(ii) if the PDP sponsor of the prescription drug 
                plan or the MA organization offering the MA-PD plan 
                does not use a formulary, for which benefits are 
                available under the prescription drug plan or MA-PD 
                plan that the applicable beneficiary is enrolled in; or
                    ``(iii) is provided through an exception or appeal.
            ``(3) Applicable number of calendar days.--The term 
        `applicable number of calendar days' means--
                    ``(A) with respect to claims for reimbursement 
                submitted electronically, 14 days; and
                    ``(B) with respect to claims for reimbursement 
                submitted otherwise, 30 days.
            ``(4) Discounted price.--
                    ``(A) In general.--The term `discounted price' 
                means--
                            ``(i) with respect to an applicable drug 
                        dispensed for an applicable beneficiary who has 
                        incurred costs that are below the annual out-
                        of-pocket threshold specified in section 1860D-
                        2(b)(4)(B) for the year, 93 percent of the 
                        negotiated price of the applicable drug of a 
                        manufacturer; and
                            ``(ii) with respect to an applicable drug 
                        dispensed for an applicable beneficiary who has 
                        incurred costs for covered part D drugs in the 
                        year that are equal to or exceed the annual 
                        out-of-pocket threshold specified in section 
                        1860D-2(b)(4)(B) for the year, 86 percent of 
                        the negotiated price of the applicable drug of 
                        a manufacturer.
                    ``(B) Clarification.--Nothing in this section shall 
                be construed as affecting the responsibility of an 
                applicable beneficiary for payment of a dispensing fee 
                for an applicable drug.
                    ``(C) Clarification for certain claims.--With 
                respect to the amount of the negotiated price of an 
                individual claim for an applicable drug with respect to 
                an applicable beneficiary, the manufacturer of the 
                applicable drug shall provide--
                            ``(i) the discounted price under clause (i) 
                        of subparagraph (A) only on the portion of the 
                        negotiated price of the applicable drug that 
                        falls above the deductible specified in section 
                        1860D-2(b)(1) for the year and below the annual 
                        out-of-pocket threshold specified in section 
                        1860D-2(b)(4)(B) for the year; and
                            ``(ii) the discounted price under clause 
                        (ii) of subparagraph (A) only on the portion of 
                        the negotiated price of the applicable drug 
                        that falls at or above such annual out-of-
                        pocket threshold.
            ``(5) Manufacturer.--The term `manufacturer' means any 
        entity which is engaged in the production, preparation, 
        propagation, compounding, conversion, or processing of 
        prescription drug products, either directly or indirectly by 
        extraction from substances of natural origin, or independently 
        by means of chemical synthesis, or by a combination of 
        extraction and chemical synthesis. Such term does not include a 
        wholesale distributor of drugs or a retail pharmacy licensed 
        under State law.
            ``(6) Negotiated price.--The term `negotiated price' has 
        the meaning given such term in section 1860D-2(d)(1)(B), except 
        that such negotiated price shall not include any dispensing fee 
        for the applicable drug.
            ``(7) Qualified retiree prescription drug plan.--The term 
        `qualified retiree prescription drug plan' has the meaning 
        given such term in section 1860D-22(a)(2).''.
            (2) Sunset of medicare coverage gap discount program.--
        Section 1860D-14A of the Social Security Act (42 U.S.C. 1395-
        114a) is amended--
                    (A) in subsection (a), in the first sentence, by 
                striking ``The Secretary'' and inserting ``Subject to 
                subsection (h), the Secretary''; and
                    (B) by adding at the end the following new 
                subsection:
    ``(h) Sunset of Program.--
            ``(1) In general.--The program shall not apply to 
        applicable drugs dispensed on or after January 1, 2023, and, 
        subject to paragraph (2), agreements under this section shall 
        be terminated as of such date.
            ``(2) Continued application for applicable drugs dispensed 
        prior to sunset.--The provisions of this section (including all 
        responsibilities and duties) shall continue to apply after 
        January 1, 2023, with respect to applicable drugs dispensed 
        prior to such date.''.
            (3) Inclusion of actuarial value of manufacturer discounts 
        in bids.--Section 1860D-11 of the Social Security Act (42 
        U.S.C. 1395w-111) is amended--
                    (A) in subsection (b)(2)(C)(iii)--
                            (i) by striking ``assumptions regarding the 
                        reinsurance'' and inserting ``assumptions 
                        regarding--
                                    ``(I) the reinsurance''; and
                            (ii) by adding at the end the following:
                                    ``(II) for 2023 and each subsequent 
                                year, the manufacturer discounts 
                                provided under section 1860D-14B 
                                subtracted from the actuarial value to 
                                produce such bid; and''; and
                    (B) in subsection (c)(1)(C)--
                            (i) by striking ``an actuarial valuation of 
                        the reinsurance'' and inserting ``an actuarial 
                        valuation of--
                            ``(i) the reinsurance'';
                            (ii) in clause (i), as added by clause (i) 
                        of this subparagraph, by adding ``and'' at the 
                        end; and
                            (iii) by adding at the end the following:
                            ``(ii) for 2023 and each subsequent year, 
                        the manufacturer discounts provided under 
                        section 1860D-14B;''.
            (4) Clarification regarding exclusion of manufacturer 
        discounts from troop.--Section 1860D-2(b)(4) of the Social 
        Security Act (42 U.S.C. 1395w-102(b)(4)) is amended--
                    (A) in subparagraph (C), by inserting ``and subject 
                to subparagraph (F)'' after ``subparagraph (E)''; and
                    (B) by adding at the end the following new 
                subparagraph:
                    ``(F) Clarification regarding exclusion of 
                manufacturer discounts.--In applying subparagraph (A), 
                incurred costs shall not include any manufacturer 
                discounts provided under section 1860D-14B.''.
    (e) Determination of Allowable Reinsurance Costs.--Section 1860D-
15(b) of the Social Security Act (42 U.S.C. 1395w-115(b)) is amended--
            (1) in paragraph (2)--
                    (A) by striking ``costs.--For purposes'' and 
                inserting ``costs.--
                    ``(A) In general.--Subject to subparagraph (B), for 
                purposes''; and
                    (B) by adding at the end the following new 
                subparagraph:
                    ``(B) Inclusion of manufacturer discounts on 
                applicable drugs.--For purposes of applying 
                subparagraph (A), the term `allowable reinsurance 
                costs' shall include the portion of the negotiated 
                price (as defined in section 1860D-14B(g)(6)) of an 
                applicable drug (as defined in section 1860D-14B(g)(2)) 
                that was paid by a manufacturer under the manufacturer 
                discount program under section 1860D-14B.''; and
            (2) in paragraph (3)--
                    (A) in the first sentence, by striking ``For 
                purposes'' and inserting ``Subject to paragraph (2)(B), 
                for purposes''; and
                    (B) in the second sentence, by inserting ``or, in 
                the case of an applicable drug, by a manufacturer'' 
                after ``by the individual or under the plan''.
    (f) Updating Risk Adjustment Methodologies To Account for Part D 
Modernization Redesign.--Section 1860D-15(c) of the Social Security Act 
(42 U.S.C. 1395w-115(c)) is amended by adding at the end the following 
new paragraph:
            ``(3) Updating risk adjustment methodologies to account for 
        part d modernization redesign.--The Secretary shall update the 
        risk adjustment methodologies used to adjust bid amounts 
        pursuant to this subsection as appropriate to take into account 
        changes in benefits under this part pursuant to the amendments 
        made by section 371 of the Fair Care Act of 2022.''.
    (g) Conditions for Coverage of Drugs Under This Part.--Section 
1860D-43 of the Social Security Act (42 U.S.C. 1395w-153) is amended--
            (1) in subsection (a)--
                    (A) in paragraph (2), by striking ``and'' at the 
                end;
                    (B) in paragraph (3), by striking the period at the 
                end and inserting a semicolon; and
                    (C) by adding at the end the following new 
                paragraphs:
            ``(4) participate in the manufacturer discount program 
        under section 1860D-14B;
            ``(5) have entered into and have in effect an agreement 
        described in subsection (b) of such section 1860D-14B with the 
        Secretary; and
            ``(6) have entered into and have in effect, under terms and 
        conditions specified by the Secretary, a contract with a third 
        party that the Secretary has entered into a contract with under 
        subsection (d)(3) of such section 1860D-14B.'';
            (2) by striking subsection (b) and inserting the following:
    ``(b) Effective Date.--Paragraphs (1) through (3) of subsection (a) 
shall apply to covered part D drugs dispensed under this part on or 
after January 1, 2011, and before January 1, 2023, and paragraphs (4) 
through (6) of such subsection shall apply to covered part D drugs 
dispensed on or after January 1, 2023.''; and
            (3) in subsection (c), by striking paragraph (2) and 
        inserting the following:
            ``(2) the Secretary determines that in the period beginning 
        on January 1, 2011, and ending on December 31, 2011 (with 
        respect to paragraphs (1) through (3) of subsection (a)), or 
        the period beginning on January 1, 2023, and ending December 
        31, 2023 (with respect to paragraphs (4) through (6) of such 
        subsection), there were extenuating circumstances.''.
    (h) Conforming Amendments.--
            (1) Section 1860D-2 of the Social Security Act (42 U.S.C. 
        1395w-102) is amended--
                    (A) in subsection (a)(2)(A)(i)(I), by striking ``, 
                or an increase in the initial'' and inserting ``or for 
                a year preceding 2023 an increase in the initial'';
                    (B) in subsection (c)(1)(C)--
                            (i) in the subparagraph heading, by 
                        striking ``at initial coverage limit''; and
                            (ii) by inserting ``for a year preceding 
                        2023 or the annual out-of-pocket threshold 
                        specified in subsection (b)(4)(B) for the year 
                        for 2023 and each subsequent year'' after 
                        ``subsection (b)(3) for the year'' each place 
                        it appears; and
                    (C) in subsection (d)(1)(A), by striking ``or an 
                initial'' and inserting ``or for a year preceding 2023 
                an initial''.
            (2) Section 1860D-4(a)(4)(B)(i) of the Social Security Act 
        (42 U.S.C. 1395w-104(a)(4)(B)(i)) is amended by striking ``the 
        initial'' and inserting ``for a year preceding 2023, the 
        initial''.
            (3) Section 1860D-14(a) of the Social Security Act (42 
        U.S.C. 1395w-114(a)) is amended--
                    (A) in paragraph (1)--
                            (i) in subparagraph (C), by striking ``The 
                        continuation'' and inserting ``For a year 
                        preceding 2023, the continuation'';
                            (ii) in subparagraph (D)(iii), by striking 
                        ``1860D-2(b)(4)(A)(i)(I)'' and inserting 
                        ``1860D-2(b)(4)(A)(i)(I)(aa)''; and
                            (iii) in subparagraph (E), by striking 
                        ``The elimination'' and inserting ``For a year 
                        preceding 2023, the elimination''; and
                    (B) in paragraph (2)--
                            (i) in subparagraph (C), by striking ``The 
                        continuation'' and inserting ``For a year 
                        preceding 2023, the continuation''; and
                            (ii) in subparagraph (E)--
                                    (I) by inserting ``for a year 
                                preceding 2023,'' after ``subsection 
                                (c)''; and
                                    (II) by striking ``1860D-
                                2(b)(4)(A)(i)(I)'' and inserting 
                                ``1860D-2(b)(4)(A)(i)(I)(aa)''.
            (4) Section 1860D-21(d)(7) of the Social Security Act (42 
        U.S.C. 1395w-131(d)(7)) is amended by striking ``section 1860D-
        2(b)(B)(4)(B)(i)'' and inserting ``section 1860D-
        2(b)(B)(4)(C)(i)''.
            (5) Section 1860D-22(a)(2)(A) of the Social Security Act 
        (42 U.S.C. 1395w-132(a)(2)(A)) is amended--
                    (A) by striking ``the value of any discount'' and 
                inserting the following: ``the value of--
                            ``(i) for years prior to 2023, any 
                        discount'';
                    (B) in clause (i), as inserted by subparagraph (A) 
                of this paragraph, by striking the period at the end 
                and inserting ``; and''; and
                    (C) by adding at the end the following new clause:
                            ``(ii) for 2023 and each subsequent year, 
                        any discount provided pursuant to section 
                        1860D-14B.''.
            (6) Section 1860D-41(a)(6) of the Social Security Act (42 
        U.S.C. 1395w-151(a)(6)) is amended--
                    (A) by inserting ``for a year before 2023'' after 
                ``1860D-2(b)(3)''; and
                    (B) by inserting ``for such year'' before the 
                period.
    (i) Effective Date.--The amendments made by this section shall 
apply to plan year 2023 and subsequent plan years.

SEC. 372. MAXIMUM MONTHLY CAP ON COST-SHARING PAYMENTS UNDER 
              PRESCRIPTION DRUG PLANS AND MA-PD PLANS.

    (a) In General.--Section 1860D-2(b) of the Social Security Act (42 
U.S.C. 1395w-102(b)), as amended by section 121, is amended--
            (1) in paragraph (2)--
                    (A) in subparagraph (A), by striking ``and (D)'' 
                and inserting ``, (D), and (E)''; and
                    (B) by adding at the end the following new 
                subparagraph:
                    ``(E) Maximum monthly cap on cost-sharing 
                payments.--
                            ``(i) In general.--For plan years beginning 
                        on or after January 1, 2023, the Secretary 
                        shall, through notice and comment rulemaking, 
                        establish a process under which each PDP 
                        sponsor offering a prescription drug plan and 
                        each MA organization offering an MA-PD plan 
                        shall provide to any enrollee, including an 
                        enrollee who is a subsidy eligible individual 
                        (as defined in paragraph (3) of section 1860D-
                        14(a)), the option to elect with respect to a 
                        plan year to have their monthly cost-sharing 
                        payments under the plan capped in accordance 
                        with this subparagraph.
                            ``(ii) Determination of maximum monthly 
                        cap.--For each month in the plan year after an 
                        enrollee in a prescription drug plan or an MA-
                        PD plan has made an election pursuant to clause 
                        (i), the PDP sponsor or MA organization shall 
                        determine a maximum monthly cap (as defined in 
                        clause (iv)) for such enrollee.
                            ``(iii) Beneficiary monthly payments.--With 
                        respect to an enrollee who has made an election 
                        pursuant to clause (i), for each month 
                        described in clause (ii), the PDP sponsor or MA 
                        organization shall bill such enrollee an amount 
                        (not to exceed the maximum monthly cap) for the 
                        out-of-pocket costs of such enrollee in such 
                        month.
                            ``(iv) Maximum monthly cap defined.--In 
                        this subparagraph, the term `maximum monthly 
                        cap' means, with respect to an enrollee--
                                    ``(I) for the first month in which 
                                this subparagraph applies, an amount 
                                determined by calculating--
                                            ``(aa) the annual out-of-
                                        pocket threshold specified in 
                                        paragraph (4)(B) minus the 
                                        incurred costs of the enrollee 
                                        as described in paragraph 
                                        (4)(C); divided by
                                            ``(bb) the number of months 
                                        remaining in the plan year; and
                                    ``(II) for a subsequent month, an 
                                amount determined by calculating--
                                            ``(aa) the sum of any 
                                        remaining out-of-pocket costs 
                                        owed by the enrollee from a 
                                        previous month that have not 
                                        yet been billed to the enrollee 
                                        and any additional costs 
                                        incurred by the enrollee; 
                                        divided by
                                            ``(bb) the number of months 
                                        remaining in the plan year.
                            ``(v) Additional requirements.--The 
                        following requirements shall apply with respect 
                        to the option to make an election pursuant to 
                        clause (i) under this subparagraph:
                                    ``(I) Secretarial 
                                responsibilities.--The Secretary shall 
                                provide information to part D eligible 
                                individuals on the option to make such 
                                election through educational materials, 
                                including through the notices provided 
                                under section 1804(a).
                                    ``(II) Timing of election.--An 
                                enrollee in a prescription drug plan or 
                                an MA-PD plan may make such an 
                                election--
                                            ``(aa) prior to the 
                                        beginning of the plan year; or
                                            ``(bb) in any month during 
                                        the plan year.
                                    ``(III) PDP sponsor and ma 
                                organization responsibilities.--Each 
                                PDP sponsor offering a prescription 
                                drug plan or MA organization offering 
                                an MA-PD plan--
                                            ``(aa) may not limit the 
                                        option for an enrollee to make 
                                        such an election to certain 
                                        covered part D drugs;
                                            ``(bb) shall, prior to the 
                                        plan year, notify prospective 
                                        enrollees of the option to make 
                                        such an election in promotional 
                                        materials;
                                            ``(cc) shall include 
                                        information on such option in 
                                        enrollee educational materials;
                                            ``(dd) shall have in place 
                                        a mechanism to notify a 
                                        pharmacy during the plan year 
                                        when an enrollee incurs out-of-
                                        pocket costs with respect to 
                                        covered part D drugs that make 
                                        it likely the enrollee may 
                                        benefit from making such an 
                                        election;
                                            ``(ee) shall provide that a 
                                        pharmacy, after receiving a 
                                        notification described in item 
                                        (dd) with respect to an 
                                        enrollee, informs the enrollee 
                                        of such notification;
                                            ``(ff) shall ensure that 
                                        such an election by an enrollee 
                                        has no effect on the amount 
                                        paid to pharmacies (or the 
                                        timing of such payments) with 
                                        respect to covered part D drugs 
                                        dispensed to the enrollee; and
                                            ``(gg) shall have in place 
                                        a financial reconciliation 
                                        process to correct inaccuracies 
                                        in payments made by an enrollee 
                                        under this subparagraph with 
                                        respect to covered part D drugs 
                                        during the plan year.
                                    ``(IV) Failure to pay amount 
                                billed.--If an enrollee fails to pay 
                                the amount billed for a month as 
                                required under this subparagraph, the 
                                election of the enrollee pursuant to 
                                clause (i) shall be terminated and 
                                enrollee shall pay the cost-sharing 
                                otherwise applicable for any covered 
                                part D drugs subsequently dispensed to 
                                the enrollee up to the annual out-of-
                                pocket threshold specified in paragraph 
                                (4)(B).
                                    ``(V) Clarification regarding past 
                                due amounts.--Nothing in this 
                                subparagraph shall be construed as 
                                prohibiting a PDP sponsor or an MA 
                                organization from billing an enrollee 
                                for an amount owed under this 
                                subparagraph.
                                    ``(VI) Treatment of unsettled 
                                balances.--Any unsettled balances with 
                                respect to amounts owed under this 
                                subparagraph shall be treated as plan 
                                losses and the Secretary shall not be 
                                liable for any such balances outside of 
                                those assumed as losses estimated in 
                                plan bids.''; and
            (2) in paragraph (4)--
                    (A) in subparagraph (C), by striking ``and subject 
                to subparagraph (F)'' and inserting ``and subject to 
                subparagraphs (F) and (G)''; and
                    (B) by adding at the end the following new 
                subparagraph:
                    ``(G) Inclusion of costs paid under maximum monthly 
                cap option.--In applying subparagraph (A), with respect 
                to an enrollee who has made an election pursuant to 
                clause (i) of paragraph (2)(E), costs shall be treated 
                as incurred if such costs are paid by a PDP sponsor or 
                an MA organization under the process provided under 
                such paragraph.''.
    (b) Application to Alternative Prescription Drug Coverage.--Section 
1860D-2(c) of the Social Security Act (42 U.S.C. 1395w-102(c)) is 
amended by adding at the end the following new paragraph:
            ``(4) Same maximum monthly cap on cost-sharing.--For plan 
        years beginning on or after January 1, 2023, the maximum 
        monthly cap on cost-sharing payments under the process provided 
        under subsection (b)(2)(E) shall apply to such coverage.''.

SEC. 373. MEDICARE PART B REBATE BY MANUFACTURERS FOR DRUGS OR 
              BIOLOGICALS WITH PRICES INCREASING FASTER THAN INFLATION.

    (a) In General.--Section 1847A of the Social Security Act (42 
U.S.C. 1395w-3a) is amended by adding at the end the following new 
subsection:
    ``(h) Rebate by Manufacturers for Drugs or Biologicals With Prices 
Increasing Faster Than Inflation.--
            ``(1) Requirements.--
                    ``(A) Secretarial provision of information.--Not 
                later than 6 months after the end of each rebate period 
                (as defined in paragraph (2)(A)) beginning on or after 
                January 1, 2023, the Secretary shall, for each 
                rebatable drug (as defined in paragraph (2)(B)), report 
                to each manufacturer of such rebatable drug the 
                following for such rebate period:
                            ``(i) Information on the total number of 
                        units of the billing and payment code described 
                        in subparagraph (A)(i) of paragraph (3) with 
                        respect to such rebatable drug and rebate 
                        period.
                            ``(ii) Information on the amount (if any) 
                        of the excess average sales price increase 
                        described in subparagraph (A)(ii) of such 
                        paragraph for such rebatable drug and rebate 
                        period.
                            ``(iii) The rebate amount specified under 
                        such paragraph for such rebatable drug and 
                        rebate period.
                    ``(B) Manufacturer rebate.--
                            ``(i) In general.--Subject to clause (ii), 
                        for each rebate period beginning on or after 
                        January 1, 2023, the manufacturer of a 
                        rebatable drug shall, for such drug, not later 
                        than 30 days after the date of receipt from the 
                        Secretary of the information and rebate amount 
                        pursuant to subparagraph (A) for such rebate 
                        period, provide to the Secretary a rebate that 
                        is equal to the amount specified in paragraph 
                        (3) for such drug for such rebate period.
                            ``(ii) Exemption for shortages.--The 
                        Secretary may reduce or waive the rebate under 
                        this subparagraph with respect to a rebatable 
                        drug that is listed on the drug shortage list 
                        maintained by the Food and Drug Administration 
                        pursuant to section 506E of the Federal Food, 
                        Drug, and Cosmetic Act.
                    ``(C) Request for reconsideration.--The Secretary 
                shall establish procedures under which a manufacturer 
                of a rebatable drug may request a reconsideration by 
                the Secretary of the rebate amount specified under 
                paragraph (3) for such rebatable drug and rebate 
                period, as reported to the manufacturer pursuant to 
                subparagraph (A)(iii).
            ``(2) Rebate period and rebatable drug defined.--In this 
        subsection:
                    ``(A) Rebate period.--The term `rebate period' 
                means a calendar quarter beginning on or after January 
                1, 2023.
                    ``(B) Rebatable drug.--The term `rebatable drug' 
                means a single source drug or biological (other than a 
                biosimilar biological product)--
                            ``(i) described in section 1842(o)(1)(C) 
                        for which the payment amount is provided under 
                        this section; or
                            ``(ii) for which payment is made separately 
                        under section 1833(i) or section 1833(t) and 
                        for which the payment amount is calculated 
                        based on the payment amount under this section.
            ``(3) Rebate amount.--
                    ``(A) In general.--For purposes of paragraph 
                (1)(B), the amount specified in this paragraph for a 
                rebatable drug assigned to a billing and payment code 
                for a rebate period is, subject to paragraph (4), the 
                amount equal to the product of--
                            ``(i) subject to subparagraph (B), the 
                        total number of units of the billing and 
                        payment code for such rebatable drug furnished 
                        during the rebate period; and
                            ``(ii) the amount (if any) by which--
                                    ``(I) the amount determined under 
                                subsection (b)(4) for such rebatable 
                                drug during the rebate period; exceeds
                                    ``(II) the inflation-adjusted base 
                                payment amount determined under 
                                subparagraph (C) of this paragraph for 
                                such rebatable drug during the rebate 
                                period.
                    ``(B) Excluded units.--For purposes of subparagraph 
                (A)(i), the total number of units of the billing and 
                payment code for rebatable drugs furnished during a 
                rebate period shall not include units with respect to 
                which the manufacturer provides a discount under the 
                program under section 340B of the Public Health Service 
                Act or a rebate under section 1927.
                    ``(C) Determination of inflation-adjusted payment 
                amount.--The inflation-adjusted payment amount 
                determined under this subparagraph for a rebatable drug 
                for a rebate period is--
                            ``(i) the amount determined under 
                        subsection (b)(4) for such rebatable drug in 
                        the payment amount benchmark quarter (as 
                        defined in subparagraph (D)); increased by
                            ``(ii) the percentage by which the rebate 
                        period CPI-U (as defined in subparagraph (F)) 
                        for the rebate period exceeds the benchmark 
                        period CPI-U (as defined in subparagraph (E)).
                    ``(D) Payment amount benchmark quarter.--The term 
                `payment amount benchmark quarter' means the calendar 
                quarter beginning July 1, 2019.
                    ``(E) Benchmark period cpi-u.--The term `benchmark 
                period CPI-U' means the consumer price index for all 
                urban consumers (United States city average) for July 
                2019.
                    ``(F) Rebate period cpi-u.--The term `rebate period 
                CPI-U' means, with respect to a rebate period, the 
                consumer price index for all urban consumers (United 
                States city average) for the last month of the calendar 
                quarter that is two calendar quarters prior to the 
                rebate period.
            ``(4) Application to new drugs.--In the case of a rebatable 
        drug first approved or licensed by the Food and Drug 
        Administration after July 1, 2021, the following shall apply:
                    ``(A) During initial period.--For quarters during 
                the initial period in which the payment amount for such 
                drug is determined using the methodology described in 
                subsection (c)(4)--
                            ``(i) clause (ii)(I) of paragraph (3)(A) 
                        shall be applied as if the reference to `the 
                        amount determined under subsection (b)(4),' 
                        were a reference to `the wholesale acquisition 
                        cost applicable under subsection (c)(4)';
                            ``(ii) clause (i) of paragraph (3)(C) shall 
                        be applied--
                                    ``(I) as if the reference to `the 
                                amount determined under subsection 
                                (b)(4),' were a reference to `the 
                                wholesale acquisition cost applicable 
                                under subsection (c)(4)'; and
                                    ``(II) as if the term `payment 
                                amount benchmark quarter' were defined 
                                under paragraph (3)(D) as the first 
                                full calendar quarter after the day on 
                                which the drug was first marketed; and
                            ``(iii) clause (ii) of paragraph (3)(C) 
                        shall be applied as if the term `benchmark 
                        period CPI-U' were defined under paragraph 
                        (4)(E) as if the reference to `July 2019' under 
                        such paragraph were a reference to `the first 
                        month of the first full calendar quarter after 
                        the day on which the drug was first marketed'.
                    ``(B) After initial period.--For quarters beginning 
                after such initial period--
                            ``(i) clause (i) of paragraph (3)(C) shall 
                        be applied as if the term `payment amount 
                        benchmark quarter' were defined under paragraph 
                        (3)(D) as the first full calendar quarter for 
                        which the Secretary is able to compute an 
                        average sales price for the rebatable drug; and
                            ``(ii) clause (ii) of paragraph (3)(C) 
                        shall be applied as if the term `benchmark 
                        period CPI-U' were defined under paragraph 
                        (4)(E) as if the reference to `July 2019' under 
                        such paragraph were a reference to `the first 
                        month of the first full calendar quarter for 
                        which the Secretary is able to compute an 
                        average sales price for the rebatable drug'.
            ``(5) Rebate deposits.--Amounts paid as rebates under 
        paragraph (1)(B) shall be deposited into the Federal 
        Supplementary Medical Insurance Trust Fund established under 
        section 1841.
            ``(6) Enforcement.--
                    ``(A) Civil money penalty.--
                            ``(i) In general.--The Secretary shall 
                        impose a civil money penalty on a manufacturer 
                        that fails to comply with the requirements 
                        under paragraph (1)(B) with respect to 
                        providing a rebate for a rebatable drug for a 
                        rebate period for each such failure in an 
                        amount equal to the sum of--
                                    ``(I) the rebate amount specified 
                                pursuant to paragraph (3) for such drug 
                                for such rebate period; and
                                    ``(II) 25 percent of such amount.
                            ``(ii) Application.--The provisions of 
                        section 1128A (other than subsections (a) (with 
                        respect to amounts of penalties or additional 
                        assessments) and (b)) shall apply to a civil 
                        money penalty under this subparagraph in the 
                        same manner as such provisions apply to a 
                        penalty or proceeding under section 1128A(a).
                    ``(B) No payment for manufacturers who fail to pay 
                penalty.--If the manufacturer of a rebatable drug fails 
                to pay a civil money penalty under subparagraph (A) 
                with respect to the failure to provide a rebate for a 
                rebatable drug for a rebate period by a date specified 
                by the Secretary after the imposition of such penalty, 
                no payment shall be available under this part for such 
                rebatable drug for calendar quarters beginning on or 
                after such date until the Secretary determines the 
                manufacturer has paid the penalty due under such 
                subparagraph.''.
    (b) Implementation.--Section 1847A(g) of the Social Security Act 
(42 U.S.C. 1395w-3(g)) is amended--
            (1) in paragraph (4), by striking ``and'' at the end;
            (2) in paragraph (5), by striking the period at the end and 
        inserting ``; and''; and
            (3) by adding at the end the following new paragraph:
            ``(6) determination of the rebate amount for a rebatable 
        drug under paragraph (3) of subsection (h), including with 
        respect to a new drug pursuant to paragraph (4) of such 
        subsection, including--
                    ``(A) a decision by the Secretary with respect to a 
                request for reconsideration under paragraph (1)(C); and
                    ``(B) the determination of--
                            ``(i) the total number of units of the 
                        billing and payment code under paragraph 
                        (3)(A)(i); and
                            ``(ii) the inflation-adjusted payment 
                        amount under paragraph (3)(C).''.
    (c) Conforming Amendment to Part B ASP Calculation.--Section 
1847A(c)(3) of the Social Security Act (42 U.S.C. 1395w-3a(c)(3)) is 
amended by inserting ``or subsection (h)'' after ``section 1927''.

SEC. 374. MARKET BASED PART B PRICING INDEX.

    Notwithstanding any provision of part B of title XVIII of the 
Social Security Act, the Secretary of Health and Human Services may 
make payments for drugs payable under such part based on an 
international pricing index. In using such an index, the Secretary 
shall take into account whether the market of each country included in 
such index is a price-controlled or free market and give more weight 
under such index to countries with market-based drug policies.

SEC. 375. INNOVATION MODEL TESTING OF MEDICARE DRUG PAYMENTS.

    Notwithstanding any provision of section 1115A, the Secretary of 
Health and Human Services may, under such section, test a model to 
integrate benefits provided for drugs under parts A, B, and D of title 
XVIII of the Social Security Act.

SEC. 376. MODIFICATION OF MAXIMUM REBATE AMOUNT UNDER MEDICAID DRUG 
              REBATE PROGRAM.

    (a) In General.--Subparagraph (D) of section 1927(c)(2) of the 
Social Security Act (42 U.S.C. 1396r-8(c)(2)) is amended to read as 
follows:
                    ``(D) Maximum rebate amount.--
                            ``(i) In general.--Except as provided in 
                        clause (ii), in no case shall the sum of the 
                        amounts applied under paragraph (1)(A)(ii) and 
                        this paragraph with respect to each dosage form 
                        and strength of a single source drug or an 
                        innovator multiple source drug for a rebate 
                        period exceed--
                                    ``(I) for rebate periods beginning 
                                after December 31, 2009, and before 
                                September 30, 2023, 100 percent of the 
                                average manufacturer price of the drug; 
                                and
                                    ``(II) for rebate periods beginning 
                                on or after October 1, 2023, 125 
                                percent of the average manufacturer 
                                price of the drug.
                            ``(ii) No maximum amount for drugs if amp 
                        increases outpace inflation.--
                                    ``(I) In general.--If the average 
                                manufacturer price with respect to each 
                                dosage form and strength of a single 
                                source drug or an innovator multiple 
                                source drug increases on or after 
                                October 1, 2022, and such increased 
                                average manufacturer price exceeds the 
                                inflation-adjusted average manufacturer 
                                price determined with respect to such 
                                drug under subclause (II) for the 
                                rebate period, clause (i) shall not 
                                apply and there shall be no limitation 
                                on the sum of the amounts applied under 
                                paragraph (1)(A)(ii) and this paragraph 
                                for the rebate period with respect to 
                                each dosage form and strength of the 
                                single source drug or innovator 
                                multiple source drug.
                                    ``(II) Inflation-adjusted average 
                                manufacturer price defined.--In this 
                                clause, the term `inflation-adjusted 
                                average manufacturer price' means, with 
                                respect to a single source drug or an 
                                innovator multiple source drug and a 
                                rebate period, the average manufacturer 
                                price for each dosage form and strength 
                                of the drug for the calendar quarter 
                                beginning July 1, 1990 (without regard 
                                to whether or not the drug has been 
                                sold or transferred to an entity, 
                                including a division or subsidiary of 
                                the manufacturer, after the 1st day of 
                                such quarter), increased by the 
                                percentage by which the consumer price 
                                index for all urban consumers (United 
                                States city average) for the month 
                                before the month in which the rebate 
                                period begins exceeds such index for 
                                September 1990.''.
    (b) Treatment of Subsequently Approved Drugs.--Section 
1927(c)(2)(B) of the Social Security Act (42 U.S.C. 1396r-8(c)(2)(B)) 
is amended by inserting ``and clause (ii)(II) of subparagraph (D)'' 
after ``clause (ii)(II) of subparagraph (A)''.
    (c) Technical Amendments.--Section 1927(c)(3)(C)(ii)(IV) of the 
Social Security Act (42 U.S.C. 1396r-9(c)(3)(C)(ii)(IV)) is amended--
            (1) by striking ``subparagraph (A)'' and inserting 
        ``paragraph (3)(A)''; and
            (2) by striking ``this subparagraph'' and inserting 
        ``paragraph (3)(C)''.

                 Subtitle F--Medical Malpractice Reform

SEC. 381. DEFINITIONS.

    In this Act:
            (1) Alternative dispute resolution system; adr.--The term 
        ``alternative dispute resolution system'' or ``ADR'' means a 
        system that provides for the resolution of health care lawsuits 
        in a manner other than through a civil action brought in a 
        State or Federal court.
            (2) Claimant.--The term ``claimant'' means any person who 
        brings a health care lawsuit, including a person who asserts or 
        claims a right to legal or equitable contribution, indemnity, 
        or subrogation, arising out of a health care liability claim or 
        action, and any person on whose behalf such a claim is asserted 
        or such an action is brought, whether deceased, incompetent, or 
        a minor.
            (3) Collateral source benefits.--The term ``collateral 
        source benefits'' means any amount paid or reasonably likely to 
        be paid in the future to or on behalf of the claimant, or any 
        service, product, or other benefit provided or reasonably 
        likely to be provided in the future to or on behalf of the 
        claimant, as a result of the injury or wrongful death, pursuant 
        to--
                    (A) any State or Federal health, sickness, income-
                disability, accident, or workers' compensation law;
                    (B) any health, sickness, income-disability, or 
                accident insurance that provides health benefits or 
                income-disability coverage;
                    (C) any contract or agreement of any group, 
                organization, partnership, or corporation to provide, 
                pay for, or reimburse the cost of medical, hospital, 
                dental, or income-disability benefits; and
                    (D) any other publicly or privately funded program.
            (4) Contingent fee.--The term ``contingent fee'' includes 
        all compensation to any person or persons which is payable only 
        if a recovery is effected on behalf of one or more claimants.
            (5) Economic damages.--The term ``economic damages'' means 
        objectively verifiable monetary losses incurred as a result of 
        the provision or use of (or failure to provide or use) health 
        care services or medical products, such as past and future 
        medical expenses, loss of past and future earnings, cost of 
        obtaining domestic services, loss of employment, and loss of 
        business or employment opportunities, unless otherwise defined 
        under applicable State law. In no circumstances shall damages 
        for health care services or medical products exceed the amount 
        actually paid or incurred by or on behalf of the claimant.
            (6) Future damages.--The term ``future damages'' means any 
        damages that are incurred after the date of judgment, 
        settlement, or other resolution (including mediation, or any 
        other form of alternative dispute resolution).
            (7) Health care lawsuit.--The term ``health care lawsuit'' 
        means any health care liability claim concerning the provision 
        of goods or services for which coverage was provided in whole 
        or in part via a Federal program, subsidy or tax benefit, or 
        any health care liability action concerning the provision of 
        goods or services for which coverage was provided in whole or 
        in part via a Federal program, subsidy or tax benefit, brought 
        in a State or Federal court or pursuant to an alternative 
        dispute resolution system, against a health care provider 
        regardless of the theory of liability on which the claim is 
        based, or the number of claimants, plaintiffs, defendants, or 
        other parties, or the number of claims or causes of action, in 
        which the claimant alleges a health care liability claim. Such 
        term does not include a claim or action which is based on 
        criminal liability; which seeks civil fines or penalties paid 
        to Federal, State, or local government; or which is grounded in 
        antitrust.
            (8) Health care liability action.--The term ``health care 
        liability action'' means a civil action brought in a State or 
        Federal court or pursuant to an alternative dispute resolution 
        system, against a health care provider regardless of the theory 
        of liability on which the claim is based, or the number of 
        plaintiffs, defendants, or other parties, or the number of 
        causes of action, in which the claimant alleges a health care 
        liability claim.
            (9) Health care liability claim.--The term ``health care 
        liability claim'' means a demand by any person, whether or not 
        pursuant to ADR, against a health care provider, including, but 
        not limited to, third-party claims, cross-claims, counter-
        claims, or contribution claims, which are based upon the 
        provision or use of (or the failure to provide or use) health 
        care services or medical products, regardless of the theory of 
        liability on which the claim is based, or the number of 
        plaintiffs, defendants, or other parties, or the number of 
        causes of action.
            (10) Health care provider.--The term ``health care 
        provider'' means any person or entity required by State or 
        Federal laws or regulations to be licensed, registered, or 
        certified to provide health care services, and being either so 
        licensed, registered, or certified, or exempted from such 
        requirement by other statute or regulation, as well as any 
        other individual or entity defined as a health care provider, 
        health care professional, or health care institution under 
        State law.
            (11) Health care services.--The term ``health care 
        services'' means the provision of any goods or services 
        (including safety, professional, or administrative services 
        directly related to health care) by a health care provider, or 
        by any individual working under the supervision of a health 
        care provider, that relates to the diagnosis, prevention, or 
        treatment of any human disease or impairment, or the assessment 
        or care of the health of human beings.
            (12) Medical product.--The term ``medical product'' means a 
        drug, device, or biological product intended for humans, and 
        the terms ``drug'', ``device'', and ``biological product'' have 
        the meanings given such terms in sections 201(g)(1) and 201(h) 
        of the Federal Food, Drug and Cosmetic Act (21 U.S.C. 321(g)(1) 
        and (h)) and section 351(a) of the Public Health Service Act 
        (42 U.S.C. 262(a)), respectively, including any component or 
        raw material used therein, but excluding health care services.
            (13) Noneconomic damages.--The term ``noneconomic damages'' 
        means damages for physical and emotional pain, suffering, 
        inconvenience, physical impairment, mental anguish, 
        disfigurement, loss of enjoyment of life, loss of society and 
        companionship, loss of consortium (other than loss of domestic 
        service), hedonic damages, injury to reputation, and all other 
        nonpecuniary losses of any kind or nature incurred as a result 
        of the provision or use of (or failure to provide or use) 
        health care services or medical products, unless otherwise 
        defined under applicable State law.
            (14) Recovery.--The term ``recovery'' means the net sum 
        recovered after deducting any disbursements or costs incurred 
        in connection with prosecution or settlement of the claim, 
        including all costs paid or advanced by any person. Costs of 
        health care incurred by the plaintiff and the attorneys' office 
        overhead costs or charges for legal services are not deductible 
        disbursements or costs for such purpose.
            (15) Representative.--The term ``representative'' means a 
        legal guardian, attorney, person designated to make decisions 
        on behalf of a patient under a medical power of attorney, or 
        any person recognized in law or custom as a patient's agent.
            (16) State.--The term ``State'' means each of the several 
        States, the District of Columbia, the Commonwealth of Puerto 
        Rico, the Virgin Islands, Guam, American Samoa, the Northern 
        Mariana Islands, the Trust Territory of the Pacific Islands, 
        and any other territory or possession of the United States, or 
        any political subdivision thereof.

SEC. 382. ENCOURAGING SPEEDY RESOLUTION OF CLAIMS.

    (a) Statute of Limitations.--
            (1) In general.--Except as provided in paragraph (2), the 
        time for the commencement of a health care lawsuit shall be, 
        whichever occurs first of the following:
                    (A) Three years after the date of the occurrence of 
                the breach or tort.
                    (B) Three years after the date the medical or 
                health care treatment that is the subject of the claim 
                is completed.
                    (C) One year after the claimant discovers, or 
                through the use of reasonable diligence should have 
                discovered, the injury.
            (2) Tolling.--In no event shall the time for commencement 
        of a health care lawsuit exceed 3 years after the date of the 
        occurrence of the breach or tort or 3 years after the date the 
        medical or health care treatment that is the subject of the 
        claim is completed (whichever occurs first) unless tolled for 
        any of the following--
                    (A) upon proof of fraud;
                    (B) intentional concealment; or
                    (C) the presence of a foreign body, which has no 
                therapeutic or diagnostic purpose or effect, in the 
                person of the injured person.
            (3) Actions by a minor.--Actions by a minor shall be 
        commenced within 3 years after the date of the occurrence of 
        the breach or tort or 3 years after the date of the medical or 
        health care treatment that is the subject of the claim is 
        completed (whichever occurs first) except that actions by a 
        minor under the full age of 6 years shall be commenced within 3 
        years after the date of the occurrence of the breach or tort, 3 
        years after the date of the medical or health care treatment 
        that is the subject of the claim is completed, or 1 year after 
        the injury is discovered, or through the use of reasonable 
        diligence should have been discovered, or prior to the minor's 
        8th birthday, whichever provides a longer period. Such time 
        limitation shall be tolled for minors for any period during 
        which a parent or guardian and a health care provider have 
        committed fraud or collusion in the failure to bring an action 
        on behalf of the injured minor.
    (b) State Flexibility.--No provision of subsection (a) shall be 
construed to preempt any State law (whether effective before, on, or 
after the date of the enactment of this Act) that--
            (1) specifies a time period of less than 3 years after the 
        date of injury or less than 1 year after the claimant 
        discovers, or through the use of reasonable diligence should 
        have discovered, the injury, for the filing of a health care 
        lawsuit;
            (2) that specifies a different time period for the filing 
        of lawsuits by a minor;
            (3) that triggers the time period based on the date of the 
        alleged negligence; or
            (4) establishes a statute of repose for the filing of a 
        health care lawsuit.

SEC. 383. COMPENSATING PATIENT INJURY.

    (a) Unlimited Amount of Damages for Actual Economic Losses in 
Health Care Lawsuits.--In any health care lawsuit, nothing in this Act 
shall limit a claimant's recovery of the full amount of the available 
economic damages, notwithstanding the limitation in subsection (b).
    (b) Additional Noneconomic Damages.--In any health care lawsuit, 
the amount of noneconomic damages, if available, shall not exceed 
$250,000, regardless of the number of parties against whom the action 
is brought or the number of separate claims or actions brought with 
respect to the same injury.
    (c) No Discount of Award for Noneconomic Damages.--For purposes of 
applying the limitation in subsection (b), future noneconomic damages 
shall not be discounted to present value. The jury shall not be 
informed about the maximum award for noneconomic damages. An award for 
noneconomic damages in excess of $250,000 shall be reduced either 
before the entry of judgment, or by amendment of the judgment after 
entry of judgment, and such reduction shall be made before accounting 
for any other reduction in damages required by law. If separate awards 
are rendered for past and future noneconomic damages and the combined 
awards exceed $250,000, the future noneconomic damages shall be reduced 
first.
    (d) Fair Share Rule.--In any health care lawsuit, each party shall 
be liable for that party's several share of any damages only and not 
for the share of any other person. Each party shall be liable only for 
the amount of damages allocated to such party in direct proportion to 
such party's percentage of responsibility. Whenever a judgment of 
liability is rendered as to any party, a separate judgment shall be 
rendered against each such party for the amount allocated to such 
party. For purposes of this section, the trier of fact shall determine 
the proportion of responsibility of each party for the claimant's harm.
    (e) State Flexibility.--No provision of this section shall be 
construed to preempt any State law (whether effective before, on, or 
after the date of the enactment of this Act) that specifies a 
particular monetary amount of economic or noneconomic damages (or the 
total amount of damages) that may be awarded in a health care lawsuit, 
regardless of whether such monetary amount is greater or lesser than is 
provided for under this section.

SEC. 384. MAXIMIZING PATIENT RECOVERY.

    (a) Court Supervision of Share of Damages Actually Paid to 
Claimants.--In any health care lawsuit, the court shall supervise the 
arrangements for payment of damages to protect against conflicts of 
interest that may have the effect of reducing the amount of damages 
awarded that are actually paid to claimants. In particular, in any 
health care lawsuit in which the attorney for a party claims a 
financial stake in the outcome by virtue of a contingent fee, the court 
shall have the power to restrict the payment of a claimant's damage 
recovery to such attorney, and to redirect such damages to the claimant 
based upon the interests of justice and principles of equity. In no 
event shall the total of all contingent fees for representing all 
claimants in a health care lawsuit exceed the following limits:
            (1) Forty percent of the first $50,000 recovered by the 
        claimant(s).
            (2) Thirty-three and one-third percent of the next $50,000 
        recovered by the claimant(s).
            (3) Twenty-five percent of the next $500,000 recovered by 
        the claimant(s).
            (4) Fifteen percent of any amount by which the recovery by 
        the claimant(s) is in excess of $600,000.
    (b) Applicability.--The limitations in this section shall apply 
whether the recovery is by judgment, settlement, mediation, 
arbitration, or any other form of alternative dispute resolution. In a 
health care lawsuit involving a minor or incompetent person, a court 
retains the authority to authorize or approve a fee that is less than 
the maximum permitted under this section. The requirement for court 
supervision in the first two sentences of subsection (a) applies only 
in civil actions.
    (c) State Flexibility.--No provision of this section shall be 
construed to preempt any State law (whether effective before, on, or 
after the date of the enactment of this Act) that specifies a lesser 
percentage or lesser total value of damages which may be claimed by an 
attorney representing a claimant in a health care lawsuit.

SEC. 385. AUTHORIZATION OF PAYMENT OF FUTURE DAMAGES TO CLAIMANTS IN 
              HEALTH CARE LAWSUITS.

    (a) In General.--In any health care lawsuit, if an award of future 
damages, without reduction to present value, equaling or exceeding 
$50,000 is made against a party with sufficient insurance or other 
assets to fund a periodic payment of such a judgment, the court shall, 
at the request of any party, enter a judgment ordering that the future 
damages be paid by periodic payments, in accordance with the Uniform 
Periodic Payment of Judgments Act promulgated by the National 
Conference of Commissioners on Uniform State Laws.
    (b) Applicability.--This section applies to all actions which have 
not been first set for trial or retrial before the effective date of 
this Act.
    (c) State Flexibility.--No provision of this section shall be 
construed to preempt any State law (whether effective before, on, or 
after the date of the enactment of this Act) that specifies periodic 
payments for future damages at any amount other than $50,000 or that 
mandates such payments absent the request of either party.

SEC. 386. PRODUCT LIABILITY FOR HEALTH CARE PROVIDERS.

    A health care provider who prescribes, or who dispenses pursuant to 
a prescription, a medical product approved, licensed, or cleared by the 
Food and Drug Administration shall not be named as a party to a product 
liability lawsuit involving such product and shall not be liable to a 
claimant in a class action lawsuit against the manufacturer, 
distributor, or seller of such product.

SEC. 387. EFFECT ON OTHER LAWS.

    (a) Vaccine Injury.--
            (1) To the extent that title XXI of the Public Health 
        Service Act establishes a Federal rule of law applicable to a 
        civil action brought for a vaccine-related injury or death--
                    (A) this Act does not affect the application of the 
                rule of law to such an action; and
                    (B) any rule of law prescribed by this subtitle in 
                conflict with a rule of law of such title XXI shall not 
                apply to such action.
            (2) If there is an aspect of a civil action brought for a 
        vaccine-related injury or death to which a Federal rule of law 
        under title XXI of the Public Health Service Act does not 
        apply, then this subtitle or otherwise applicable law (as 
        determined under this subtitle) will apply to such aspect of 
        such action.
    (b) Other Federal Law.--Except as provided in this section, nothing 
in this subtitle shall be deemed to affect any defense available to a 
defendant in a health care lawsuit or action under any other provision 
of Federal law.

SEC. 388. LIMITATION ON EXPERT WITNESS TESTIMONY.

    (a) In General.--No person in a health care profession requiring 
licensure under the laws of a State shall be competent to testify in 
any court of law to establish the following facts--
            (1) the recognized standard of acceptable professional 
        practice and the specialty thereof, if any, that the defendant 
        practices, which shall be the type of acceptable professional 
        practice recognized in the defendant's community or in a 
        community similar to the defendant's community that was in 
        place at the time the alleged injury or wrongful action 
        occurred;
            (2) that the defendant acted with less than or failed to 
        act with ordinary and reasonable care in accordance with the 
        recognized standard; and
            (3) that as a proximate result of the defendant's negligent 
        act or omission, the claimant suffered injuries which would not 
        otherwise have occurred,
unless the person was licensed to practice, in the State or a 
contiguous bordering State, a profession or specialty which would make 
the person's expert testimony relevant to the issues in the case and 
had practiced this profession or specialty in one of these States 
during the year preceding the date that the alleged injury or wrongful 
act occurred.
    (b) Applicability.--The requirements set forth in subsection (a) 
shall also apply to expert witnesses testifying for the defendant as 
rebuttal witnesses.
    (c) Waiver Authority.--The court may waive the requirements in this 
subsection if it determines that the appropriate witnesses otherwise 
would not be available.

SEC. 389. EXPERT WITNESS QUALIFICATIONS.

    (a) In General.--In any health care lawsuit, an individual shall 
not give expert testimony on the appropriate standard of practice or 
care involved unless the individual is licensed as a health 
professional in one or more States and the individual meets the 
following criteria:
            (1) If the party against whom or on whose behalf the 
        testimony is to be offered is or claims to be a specialist, the 
        expert witness shall specialize at the time of the occurrence 
        that is the basis for the lawsuit in the same specialty or 
        claimed specialty as the party against whom or on whose behalf 
        the testimony is to be offered. If the party against whom or on 
        whose behalf the testimony is to be offered is or claims to be 
        a specialist who is board certified, the expert witness shall 
        be a specialist who is board certified in that specialty or 
        claimed specialty.
            (2) During the 1-year period immediately preceding the 
        occurrence of the action that gave rise to the lawsuit, the 
        expert witness shall have devoted a majority of the 
        individual's professional time to one or more of the following:
                    (A) The active clinical practice of the same health 
                profession as the defendant and, if the defendant is or 
                claims to be a specialist, in the same specialty or 
                claimed specialty.
                    (B) The instruction of students in an accredited 
                health professional school or accredited residency or 
                clinical research program in the same health profession 
                as the defendant and, if the defendant is or claims to 
                be a specialist, in an accredited health professional 
                school or accredited residency or clinical research 
                program in the same specialty or claimed specialty.
            (3) If the defendant is a general practitioner, the expert 
        witness shall have devoted a majority of the witness's 
        professional time in the 1-year period preceding the occurrence 
        of the action giving rise to the lawsuit to one or more of the 
        following:
                    (A) Active clinical practice as a general 
                practitioner.
                    (B) Instruction of students in an accredited health 
                professional school or accredited residency or clinical 
                research program in the same health profession as the 
                defendant.
    (b) Lawsuits Against Entities.--If the defendant in a health care 
lawsuit is an entity that employs a person against whom or on whose 
behalf the testimony is offered, the provisions of subsection (a) apply 
as if the person were the party or defendant against whom or on whose 
behalf the testimony is offered.
    (c) Power of Court.--Nothing in this section shall limit the power 
of the trial court in a health care lawsuit to disqualify an expert 
witness on grounds other than the qualifications set forth under this 
subsection.
    (d) Limitation.--An expert witness in a health care lawsuit shall 
not be permitted to testify if the fee of the witness is in any way 
contingent on the outcome of the lawsuit.
    (e) State Flexibility.--No provision of this section shall be 
construed to preempt any State law (whether effective before, on, or 
after the date of the enactment of this Act) that places additional 
qualification requirements upon any individual testifying as an expert 
witness.

SEC. 390. COMMUNICATIONS FOLLOWING UNANTICIPATED OUTCOME.

    (a) Provider Communications.--In any health care liability action, 
any and all statements, affirmations, gestures, or conduct expressing 
apology, fault, sympathy, commiseration, condolence, compassion, or a 
general sense of benevolence which are made by a health care provider 
or an employee of a health care provider to the patient, a relative of 
the patient, or a representative of the patient and which relate to the 
discomfort, pain, suffering, injury, or death of the patient as the 
result of the unanticipated outcome of medical care shall be 
inadmissible for any purpose as evidence of an admission of liability 
or as evidence of an admission against interest.
    (b) State Flexibility.--No provision of this section shall be 
construed to preempt any State law (whether effective before, on, or 
after the date of the enactment of this Act) that makes additional 
communications inadmissible as evidence of an admission of liability or 
as evidence of an admission against interest.

SEC. 391. AFFIDAVIT OF MERIT.

    (a) Required Filing.--Subject to subsection (b), the plaintiff in a 
health care lawsuit alleging negligence or, if the plaintiff is 
represented by an attorney, the plaintiff's attorney shall file 
simultaneously with the health care lawsuit an affidavit of merit 
signed by a health professional who meets the requirements for an 
expert witness under section 242 of this Act. The affidavit of merit 
shall certify that the health professional has reviewed the notice and 
all medical records supplied to him or her by the plaintiff's attorney 
concerning the allegations contained in the notice and shall contain a 
statement of each of the following:
            (1) The applicable standard of practice or care.
            (2) The health professional's opinion that the applicable 
        standard of practice or care was breached by the health 
        professional or health facility receiving the notice.
            (3) The actions that should have been taken or omitted by 
        the health professional or health facility in order to have 
        complied with the applicable standard of practice or care.
            (4) The manner in which the breach of the standard of 
        practice or care was the proximate cause of the injury alleged 
        in the notice.
            (5) A listing of the medical records reviewed.
    (b) Filing Extension.--Upon motion of a party for good cause shown, 
the court in which the complaint is filed may grant the plaintiff or, 
if the plaintiff is represented by an attorney, the plaintiff's 
attorney an additional 28 days in which to file the affidavit required 
under subsection (a).
    (c) State Flexibility.--No provision of this section shall be 
construed to preempt any State law (whether effective before, on, or 
after the date of the enactment of this Act) that establishes 
additional requirements for the filing of an affidavit of merit or 
similar pre-litigation documentation.

SEC. 392. NOTICE OF INTENT TO COMMENCE LAWSUIT.

    (a) Advance Notice.--A person shall not commence a health care 
lawsuit against a health care provider unless the person has given the 
health care provider 90 days written notice before the action is 
commenced.
    (b) Exceptions.--A health care lawsuit against a health care 
provider filed within 6 months of the statute of limitations expiring 
as to any claimant, or within 1 year of the statute of repose expiring 
as to any claimant, shall be exempt from compliance with this section.
    (c) State Flexibility.--No provision of this section shall be 
construed to preempt any State law (whether effective before, on, or 
after the date of the enactment of this Act) that establishes a 
different time period for the filing of written notice.

SEC. 393. LIMITATION ON LIABILITY FOR VOLUNTEER HEALTH CARE 
              PROFESSIONALS.

    (a) In General.--Title II of the Public Health Service Act (42 
U.S.C. 202 et seq.) is amended by inserting after section 224 the 
following:

``SEC. 224A. LIMITATION ON LIABILITY FOR VOLUNTEER HEALTH CARE 
              PROFESSIONALS.

    ``(a) Limitation on Liability.--A physician shall not be liable 
under Federal or State law in any civil action for any harm caused by 
an act or omission of such physician, or attending medical personnel 
supporting such physician, if such act or omission--
            ``(1) occurs in the course of furnishing qualified charity 
        care (as such term is defined in section 199B of the Internal 
        Revenue Code of 1986); and
            ``(2) was not grossly negligent.
    ``(b) Preemption.--This section preempts the laws of a State or any 
political subdivision of a State to the extent that such laws are 
inconsistent with this section, unless such laws provide greater 
protection from liability for a defendant.
    ``(c) Definitions.--In this section:
            ``(1) Physician.--The term `physician' has the meaning 
        given such term by section 1861(r) of the Social Security Act.
            ``(2) Attending medical personnel.--The term `attending 
        medical personnel' means an individual who is licensed to 
        directly support a physician in furnishing medical services.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to any claim filed to the extent that it is with respect to acts 
or omissions occurring after the date of the enactment of this Act.

SEC. 394. RULES OF CONSTRUCTION.

    (a) Health Care Lawsuits.--Unless otherwise specified in this 
subtitle, the provisions governing health care lawsuits set forth in 
this subtitle preempt, subject to subsections (b) and (c), State law to 
the extent that State law prevents the application of any provisions of 
law established by or under this subtitle. The provisions governing 
health care lawsuits set forth in this subtitle supersede chapter 171 
of title 28, United States Code, to the extent that such chapter--
            (1) provides for a greater amount of damages or contingent 
        fees, a longer period in which a health care lawsuit may be 
        commenced, or a reduced applicability or scope of periodic 
        payment of future damages, than provided in this subtitle; or
            (2) prohibits the introduction of evidence regarding 
        collateral source benefits, or mandates or permits subrogation 
        or a lien on collateral source benefits.
    (b) Protection of States' Rights and Other Laws.--Any issue that is 
not governed by any provision of law established by or under this 
subtitle (including State standards of negligence) shall be governed by 
otherwise applicable State or Federal law.
    (c) State Flexibility.--No provision of this subtitle shall be 
construed to preempt any defense available to a party in a health care 
lawsuit under any other provision of State or Federal law.

SEC. 395. EFFECTIVE DATE.

    This subtitle shall apply to any health care lawsuit brought in a 
Federal or State court, or subject to an alternative dispute resolution 
system, that is initiated on or after the date of the enactment of this 
subtitle, except that any health care lawsuit arising from an injury 
occurring prior to the date of the enactment of this subtitle shall be 
governed by the applicable statute of limitations provisions in effect 
at the time the cause of action accrued.

                TITLE IV--MEDICARE AND MEDICAID REFORMS

                      Subtitle A--Medicaid Reforms

SEC. 401. MEDICAID PAYMENT REFORM.

    (a) In General.--Title XIX of the Social Security Act (42 U.S.C. 
1396 et seq.) is amended by inserting after section 1903 the following 
section:

``SEC. 1903A. REFORMED PAYMENT TO STATES.

    ``(a) Reformed Payment System.--
            ``(1) In general.--For quarters beginning on or after the 
        implementation date (as defined in subsection (k)(1)), in the 
        case of a State that elects (in a time and manner specified by 
        the Secretary) to apply this section, in lieu of amounts 
        otherwise payable to such State under this title (including any 
        payments attributable to section 1923), except as otherwise 
        provided in this section, the amount payable to such State 
        shall be equal to the sum of the following:
                    ``(A) Adjusted aggregate beneficiary-based 
                amount.--The aggregate beneficiary-based amount 
                specified in subsection (b) for the quarter and the 
                State, adjusted under subsection (e).
                    ``(B) Chronic care quality bonus.--The amount (if 
                any) of the chronic care quality bonus payment 
                specified in subsection (f) for the quarter for the 
                State.
            ``(2) Requirement of state share.--
                    ``(A) In general.--A State shall make, from non-
                Federal funds, expenditures in an amount equal to its 
                State share (as determined under subparagraph (B)) for 
                a quarter for items, services, and other costs for 
                which, but for paragraph (1), Federal funds would have 
                been payable under this title.
                    ``(B) State share.--The State share for a State for 
                a quarter in a fiscal year is equal to the product of--
                            ``(i) the aggregate beneficiary-based 
                        amount specified in subsection (b) for the 
                        quarter and the State; and
                            ``(ii) the ratio of--
                                    ``(I) the State percentage 
                                described in subparagraph (D)(ii) for 
                                such State and fiscal year; to
                                    ``(II) the Federal percentage 
                                described in subparagraph (D)(i) for 
                                such State and fiscal year.
                    ``(C) Nonpayment for failure to pay state share.--
                            ``(i) In general.--If a State fails to 
                        expend the amount required under subparagraph 
                        (A) for a quarter in a fiscal year, the amount 
                        payable to the State under paragraph (1) shall 
                        be reduced by the product of the amount by 
                        which the State payment is less than the State 
                        share and the ratio of--
                                    ``(I) the Federal percentage 
                                described in subparagraph (D)(i) for 
                                such State and fiscal year; to
                                    ``(II) the State percentage 
                                described in subparagraph (D)(ii) for 
                                such State and fiscal year.
                            ``(ii) Grace period.--A State shall not be 
                        considered to have failed to provide payment of 
                        its required State share for a quarter under 
                        subparagraph (A) if the aggregate State payment 
                        towards the State's required State share for 
                        the 4-quarter period beginning with such 
                        quarter exceeds the required State share amount 
                        for such 4-quarter period.
                    ``(D) Federal and state percentages.--In this 
                paragraph, with respect to a State and a fiscal year:
                            ``(i) Federal percentage.--The Federal 
                        percentage described in this clause is 75 
                        percent or, if higher, the Federal medical 
                        assistance percentage for such State for such 
                        fiscal year.
                            ``(ii) State percentage.--The State 
                        percentage described in this clause is 100 
                        percent minus the Federal percentage described 
                        in clause (i).
                    ``(E) Rules for crediting toward state share.--
                            ``(i) General limitation to matchable 
                        expenditures.--A payment for expenditures shall 
                        not be counted toward the State share under 
                        subparagraph (A) unless Federal payments may be 
                        used for such expenditures consistent with 
                        paragraph (3)(B).
                            ``(ii) Further limitations on allowable 
                        expenditures.--A payment for expenditures shall 
                        not be counted towards the State share under 
                        subparagraph (A) if the expenditure is for any 
                        of the following:
                                    ``(I) Abortion.--Expenditures for 
                                an abortion.
                                    ``(II) Intergovernmental 
                                transfers.--An expenditure that is 
                                attributable to an intergovernmental 
                                transfer.
                                    ``(III) Certified public 
                                expenditures.--An expenditure that is 
                                attributable to certified public 
                                expenditures.
                            ``(iii) Crediting fraud and abuse 
                        recoveries.--Amounts recovered by a State 
                        through the operation of its Medicaid fraud and 
                        abuse control unit described in section 1903(q) 
                        shall be fully counted toward the State share 
                        under subparagraph (A).
                    ``(F) Construction.--Nothing in the paragraph shall 
                be construed as preventing a State from expending, from 
                non-Federal funds, an amount under this title in excess 
                of the amount of the State share.
                    ``(G) Determination based upon submitted claims.--
                In applying this paragraph with respect to expenditures 
                of a State for a quarter, the determination of the 
                expenditures for such State for such quarter shall be 
                made after the end of the period (which, as of the date 
                of the enactment of this section, is 2 years) for which 
                the Secretary accepts claims for payment under this 
                title with respect to such quarter.
            ``(3) Use of federal payments.--
                    ``(A) Application of medicaid limitations.--A State 
                may only use Federal payments received under subsection 
                (a) for expenditures for which Federal funds would have 
                been payable under this title but for this section.
                    ``(B) Limitation for certain eligibles.--
                            ``(i) Application of 100 percent federal 
                        poverty line limit on eligibility.--Subject to 
                        clause (iii), a State may not use such Federal 
                        payments to provide medical assistance for an 
                        individual who has an income (as determined 
                        under clause (ii)) that exceeds 100 percent of 
                        the poverty line (as defined in section 
                        2110(c)(5)) applicable to a family of the size 
                        involved.
                            ``(ii) Determination of income using 
                        modified adjusted gross income without any 5 
                        percent increase.--In determining income for 
                        purposes of clause (i) under section 
                        1902(e)(14) (relating to modified adjusted 
                        gross income), the following rules shall apply:
                                    ``(I) Application of spend down.--
                                The State shall take into account the 
                                costs incurred for medical care or for 
                                any other type of remedial care 
                                recognized under State law in the same 
                                manner and to the same extent that such 
                                State takes such costs into account for 
                                purposes of section 1902(a)(17).
                                    ``(II) Disregard of 5 percent 
                                increase.--Subparagraph (I) of section 
                                1902(e)(14) (relating to a 5 percent 
                                reduction) shall not apply.
                            ``(iii) Exception.--Clause (i) shall not 
                        apply to an individual who is--
                                    ``(I) a woman described in clause 
                                (i) of section 1903(v)(4)(A);
                                    ``(II) a child who is an individual 
                                described in clause (i) of section 
                                1905(a);
                                    ``(III) enrolled in a State plan 
                                under this title as of the date of the 
                                enactment of this section for the 
                                period of continuous enrollment; or
                                    ``(IV) described in section 
                                1902(e)(14)(D) (relating to modified 
                                adjusted gross income).
                            ``(iv) Clarification related to community 
                        spouse.--Nothing in this subparagraph shall 
                        supersede the application of section 1924 
                        (related to community spouse income and 
                        assets).
            ``(4) Exceptions for pass-through payments.--
                    ``(A) In general.--Paragraph (1) shall not apply, 
                and amounts shall continue to be payable under this 
                title (and not under subsection (a)), in the case of 
                the following payments (and related administrative 
                costs and expenditures):
                            ``(i) Payments to territories.--Payments to 
                        a State other than the 50 States and the 
                        District of Columbia.
                            ``(ii) Medicare cost-sharing.--Payments 
                        attributable to Medicare cost-sharing under 
                        section 1905(p).
                            ``(iii) Pediatric vaccines.--Payments 
                        attributable to section 1928.
                            ``(iv) Emergency services for certain 
                        individuals.--Payments for treatment of 
                        emergency medical conditions attributable to 
                        the application of section 1903(v)(2).
                            ``(v) Indian health care facilities.--
                        Payments for medical assistance described in 
                        the third sentence of section 1905(b).
                            ``(vi) Employer-sponsored insurance 
                        (esi).--Payments for medical assistance 
                        attributable to payments to employers for 
                        employer-sponsored health benefits coverage.
                            ``(vii) Other populations with limited 
                        benefit coverage.--Other payments that are 
                        determined by the Secretary to be related to a 
                        specified population for which the medical 
                        assistance under this title is limited and does 
                        not include any inpatient, nursing facility, or 
                        long-term care services.
                    ``(B) Certain expenses.--Paragraph (1) shall not 
                apply, and amounts shall continue to be payable under 
                this title (and not under subsection (a)), in the case 
                of the following:
                            ``(i) Administration of medicare 
                        prescription drug benefit.--Expenditures 
                        described in section 1935(b) (relating to 
                        administration of the Medicare prescription 
                        drug benefit).
                            ``(ii) Payments for hit bonuses.--Payments 
                        under section 1903(a)(3)(F) (relating to 
                        payments to encourage the adoption and use of 
                        certified EHR technology).
                            ``(iii) Payments for design, development, 
                        and installation of mmis and eligibility 
                        systems.--Payments under subparagraphs (A)(i) 
                        and (H)(i) of section 1903(a)(3) for 
                        expenditures for design, development, and 
                        installation of the Medicaid management 
                        information systems and mechanized verification 
                        and information retrieval systems (related to 
                        eligibility).
            ``(5) Payment of amounts.--
                    ``(A) In general.--Except as the Secretary may 
                otherwise provide, amounts shall be payable to a State 
                under subsection (a) in the same manner as amounts are 
                payable under subsection (d) of section 1903 to a State 
                under subsection (a) of such section.
                    ``(B) Information and forms.--
                            ``(i) Submission.--As a condition of 
                        receiving payment under subsection (a), a State 
                        shall submit such information, in such form, 
                        and manner, as the Secretary shall specify, 
                        including information necessary to make the 
                        computations under subsections (c)(2)(C) and 
                        (e).
                            ``(ii) Uniform reporting.--The Secretary 
                        shall develop such forms as may be needed to 
                        assure a system of uniform reporting of such 
                        information across States.
                    ``(C) Required reporting of information on medical 
                loss ratios for managed care.--The information required 
                to be reported under subparagraph (B)(i) shall include 
                information on the medical loss ratio with respect to 
                coverage provided under each Medicaid managed care plan 
                with a contract with the State under section 1903(m) or 
                1932.
    ``(b) Aggregate Beneficiary-Based Amount.--
            ``(1) In general.--The aggregate beneficiary-based amount 
        specified in this subsection for a State for a quarter is equal 
        to the sum of the products, for each of the categories of 
        Medicaid beneficiaries specified in paragraph (2), of the 
        following:
                    ``(A) Beneficiary-based quarterly amount.--The 
                beneficiary-based quarterly amount for such category 
                computed under subsection (c) for such State for such 
                quarter.
                    ``(B) Number of individuals in category.--Subject 
                to subsection (d), the average number of Medicaid 
                beneficiaries enrolled in such category in the State in 
                such quarter.
            ``(2) Categories.--The categories specified in this 
        paragraph are the following:
                    ``(A) Elderly.--A category of Medicaid 
                beneficiaries who are 65 years of age or older.
                    ``(B) Blind or disabled.--A category of Medicaid 
                beneficiaries not described in subparagraph (A) who are 
                described in section 1937(a)(2)(B)(ii).
                    ``(C) Children.--A category of Medicaid 
                beneficiaries not described in subparagraph (B) who are 
                under 21 years of age.
                    ``(D) Other adults.--A category of any Medicaid 
                beneficiaries who are not described in a previous 
                subparagraph of this paragraph.
    ``(c) Computation of Per Beneficiary, Per Category Quarterly 
Amount.--
            ``(1) In general.--For a State, for each category of 
        beneficiary for a quarter--
                    ``(A) First reform year.--For quarters in the first 
                reform year (as defined in subsection (k)(2)), the 
                beneficiary-based quarterly amount is equal to \1/4\ of 
                the base average per beneficiary Federal payments for 
                such State for such category determined under paragraph 
                (2), increased by a factor that reflects the sum of the 
                following:
                            ``(i) Historical medical care component of 
                        cpi through previous reform year.--The 
                        percentage increase in the historical medical 
                        care component of the Consumer Price Index for 
                        all urban consumers (U.S. city average) from 
                        the midpoint of the base fiscal year (as 
                        defined in paragraph (6)) to the midpoint of 
                        the fiscal year preceding the first reform 
                        year.
                            ``(ii) Projected medical care component of 
                        cpi for the first reform year.--The percentage 
                        increase in the projected medical care 
                        component of the Consumer Price Index for all 
                        urban consumers (U.S. city average) from the 
                        midpoint of the previous fiscal year referred 
                        to in clause (i) to the midpoint of the first 
                        reform year.
                    ``(B) Second and third reform years.--The 
                beneficiary-based quarterly amount for a State for a 
                category for quarters in the second reform year or the 
                third reform year is equal to the beneficiary-based 
                quarterly amount under this paragraph for such State 
                and category for the previous reform year increased by 
                the per beneficiary percentage increase (as defined in 
                subparagraph (E)) for such category and reform year.
                    ``(C) Fourth through tenth reform years.--The 
                beneficiary-based quarterly amount for a State for a 
                category for quarters in a reform year beginning with 
                the fourth reform year and ending with the tenth reform 
                year is--
                            ``(i) in the case of a State that is a high 
                        per beneficiary State or a low per beneficiary 
                        State (as defined in paragraph (4)(B)(iii)) for 
                        the category, the amount determined under 
                        clause (i) or (ii) of paragraph (4)(B) for such 
                        State, category, and reform year; or
                            ``(ii) in the case of any other State, the 
                        beneficiary-based quarterly amount under this 
                        paragraph for such State and category for the 
                        previous reform year increased by the per 
                        beneficiary percentage increase for such 
                        category and reform year.
                    ``(D) Eleventh reform year and subsequent reform 
                years.--The beneficiary-based quarterly amount for a 
                State for a category for quarters in a reform year 
                beginning with the eleventh reform year is equal to the 
                beneficiary-based quarterly amount under this paragraph 
                for such State and category for the previous reform 
                year increased by the per beneficiary percentage 
                increase for such category and reform year.
                    ``(E) Annual percentage increase beginning with 
                second reform year.--For purposes of this subsection, 
                the term `per beneficiary percentage increase' means, 
                for a reform year, the sum of--
                            ``(i) the projected percentage change in 
                        nominal gross domestic product from the 
                        midpoint of the previous reform year to the 
                        midpoint of the reform year for which the 
                        percentage increase is being applied; and
                            ``(ii) one percentage point.
            ``(2) Base per beneficiary, per category amount for each 
        state.--
                    ``(A) Average per category.--
                            ``(i) In general.--The Secretary shall 
                        determine, consistent with this paragraph and 
                        paragraph (3), a base per beneficiary, per 
                        category amount for each of the 50 States and 
                        the District of Columbia equal to the average 
                        amount, per Medicaid beneficiary, of Federal 
                        payments under this title, including payments 
                        attributable to disproportionate share hospital 
                        payments under section 1923, for each of the 
                        categories of beneficiaries under subsection 
                        (b)(2) for the base fiscal year for each of the 
                        50 States and the District of Columbia.
                            ``(ii) Best available data.--The 
                        determination under clause (i) shall initially 
                        be estimated by the Secretary, based upon the 
                        best available data at the time the 
                        determination is made.
                            ``(iii) Updates.--The determination under 
                        clause (i) shall be updated by the Secretary on 
                        an annual basis based upon improved data. The 
                        Secretary shall adjust the amounts under 
                        subsection (a)(1)(A) to reflect changes in the 
                        amounts so determined based on such updates.
                    ``(B) Exclusion of pass-through payments.--In 
                computing base per beneficiary, per category amounts 
                under subparagraph (A)(i) the Secretary shall exclude 
                payments described in subsection (a)(4).
                    ``(C) Standardization.--
                            ``(i) In general.--In computing each such 
                        amount, the Secretary shall standardize the 
                        amount in order to remove the variation 
                        attributable to the following:
                                    ``(I) Risk factors.--Such risk 
                                factors as age, health and disability 
                                status (including high cost medical 
                                conditions), gender, institutional 
                                status, and such other factors as the 
                                Secretary determines to be appropriate, 
                                so as to ensure actuarial equivalence.
                                    ``(II) Geographic.--Variations in 
                                costs on a county-by-county basis.
                            ``(ii) Method of standardization.--
                                    ``(I) Consultation in development 
                                of risk standardization.--In developing 
                                the methodology for risk 
                                standardization for purposes of clause 
                                (i)(I), the Secretary shall consult 
                                with the Medicaid and CHIP Payment and 
                                Access Commission, the Medicare Payment 
                                Advisory Commission, and the National 
                                Association of Medicaid Directors.
                                    ``(II) Method for risk 
                                standardization.--In carrying out 
                                clause (i)(I), the Secretary may apply 
                                the hierarchal condition category 
                                methodology under section 
                                1853(a)(1)(C). If the Secretary uses 
                                such methodology, the Secretary shall 
                                adjust the application of such 
                                methodology to take into account the 
                                differences in services provided under 
                                this title compared to title XVIII, 
                                such as the coverage of long term care, 
                                pregnancy, and pediatric services.
                                    ``(III) Method for geographic 
                                standardization.--The Secretary shall 
                                apply the standardization under clause 
                                (i)(II) in a manner similar to that 
                                applied under section 
                                1853(c)(4)(A)(iii).
                            ``(iii) Application on a national, budget 
                        neutral basis.--The standardization under 
                        clause (i) shall be designed and implemented on 
                        a uniform national basis and shall be budget 
                        neutral so as to not result in any aggregate 
                        change in payments under subsection (a).
                            ``(iv) Response to new risk.--Subject to 
                        clause (iii), the Secretary may adjust the 
                        standardization under clause (i) to respond 
                        promptly to new instances of communicable 
                        diseases and other public health hazards.
                            ``(v) Reference to application of risk 
                        adjustment.--For rules related to the 
                        application of risk adjustment to amounts under 
                        subsection (a)(1)(A), see subsection (e).
                    ``(D) Adjustment for temporary fmap increases.--In 
                computing each base per beneficiary, per category 
                amounts under subparagraph (A)(i) the Secretary shall 
                disregard portions of payments that are attributable to 
                a temporary increase in the Federal matching rates, 
                including those attributable to the following:
                            ``(i) PPACA disaster fmap.--Section 
                        1905(aa).
                            ``(ii) ARRA.--Section 5001 of the American 
                        Recovery and Reinvestment Act of 2009 (42 
                        U.S.C. 1396d note).
                            ``(iii) Extraordinary employer pension 
                        contribution.--Section 614 of the Children's 
                        Health Insurance Program Reauthorization Act of 
                        2009 (42 U.S.C. 1396d note).
            ``(3) Allocation of nonmedical assistance payments.--The 
        Secretary shall establish rules for the allocation of payments 
        under this title (other than those payments described in 
        paragraph (1) or (5) of section 1903(a) and including such 
        payments attributable to section 1923)--
                    ``(A) among different categories of beneficiaries; 
                and
                    ``(B) between payments included under subsection 
                (a)(1) and payments described in subsection (a)(4).
            ``(4) Transition to a corridor around the national 
        average.--
                    ``(A) Determination of national average base per 
                beneficiary, per category amount.--Subject to 
                subparagraph (C), the Secretary shall determine a 
                national average base per beneficiary, per category 
                amount equal to the average of the base per 
                beneficiary, per category amounts for each of the 50 
                States and the District of Columbia determined under 
                paragraph (2), weighted by the average number of 
                beneficiaries in each such category and State as 
                determined by the Secretary consistent with subsection 
                (d) for the base fiscal year.
                    ``(B) Transition adjustment.--
                            ``(i) High per beneficiary states.--In the 
                        case of a high per beneficiary State (as 
                        defined in clause (iii)(I)) for a category, the 
                        beneficiary-based quarterly amount for such 
                        State and category for a quarter in a reform 
                        year (beginning with the fourth reform year and 
                        ending with the tenth reform year) is equal to 
                        the sum of--
                                    ``(I) the product of the State-
                                specific factor for such reform year 
                                (as defined in clause (iv)) and the 
                                beneficiary-based quarterly amount that 
                                would otherwise be determined under 
                                paragraph (1) for such State and 
                                category if the State were a State 
                                described in clause (ii) of paragraph 
                                (1)(C), instead of a State described in 
                                clause (i) of such paragraph; and
                                    ``(II) the product of 1 minus the 
                                State-specific factor for such reform 
                                year and the beneficiary-based 
                                quarterly amount that would otherwise 
                                be determined under paragraph (1) for a 
                                State and category if the base per 
                                beneficiary, per category amount 
                                determined under paragraph (2) for the 
                                State and category were equal to 110 
                                percent of the national average base 
                                per beneficiary, per category amount 
                                determined under subparagraph (A) for 
                                such category.
                            ``(ii) Low per beneficiary states.--In the 
                        case of a low per beneficiary State (as defined 
                        in clause (iii)(II)) for a category, the 
                        beneficiary-based quarterly amount for such 
                        State and category for a quarter in a reform 
                        year (beginning with the fourth reform year and 
                        ending with the tenth reform year) is equal to 
                        the sum of--
                                    ``(I) the product of the State-
                                specific factor for such reform year 
                                and the beneficiary-based quarterly 
                                amount that would otherwise be 
                                determined under paragraph (1) for such 
                                State and category if the State were a 
                                State described in clause (ii) of 
                                paragraph (1)(C), instead of a State 
                                described in clause (i) of such 
                                paragraph; and
                                    ``(II) the product of 1 minus the 
                                State-specific factor for such reform 
                                year and the beneficiary-based 
                                quarterly amount that would otherwise 
                                be determined under paragraph (1) for a 
                                State and category if the base per 
                                beneficiary, per category amount 
                                determined under paragraph (2) for the 
                                State and category were equal to 90 
                                percent of the national average base 
                                per beneficiary, per category amount 
                                determined under subparagraph (A) for 
                                such category.
                            ``(iii) High and low per beneficiary states 
                        defined.--In this subparagraph:
                                    ``(I) High per beneficiary state.--
                                The term `high per beneficiary State' 
                                means, with respect to a category, a 
                                State for which the base per 
                                beneficiary, per category amount 
                                determined under paragraph (2) for such 
                                category is greater than 110 percent of 
                                the national average base per 
                                beneficiary, per category amount 
                                determined under subparagraph (A) for 
                                such category.
                                    ``(II) Low per beneficiary state.--
                                The term `low per beneficiary State' 
                                means, with respect to a category, a 
                                State for which the base per 
                                beneficiary, per category amount 
                                determined under paragraph (2) for such 
                                category is less than 90 percent of the 
                                national average base per beneficiary, 
                                per category amount determined under 
                                subparagraph (A) for such category.
                            ``(iv) State-specific factor.--In this 
                        subparagraph, the term `State-specific factor' 
                        means--
                                    ``(I) for the fourth reform year, 
                                \7/8\; and
                                    ``(II) for a subsequent reform 
                                year, the State-specific factor under 
                                this clause for the previous reform 
                                year minus \1/8.\
                    ``(C) No additional expenditures.--
                            ``(i) Determination of increase in federal 
                        expenditures.--For each category for each 
                        reform year (beginning with the fourth reform 
                        year and ending with the tenth reform year), 
                        the Secretary shall determine whether the 
                        application of this paragraph--
                                    ``(I) to the category for the 
                                reform year will result in an aggregate 
                                increase in the aggregate Federal 
                                expenditures under subsection (a); and
                                    ``(II) to all the categories for 
                                the reform year will result in a net 
                                aggregate increase in the aggregate 
                                Federal expenditures under subsection 
                                (a).
                            ``(ii) Adjustment.--If the Secretary 
                        determines under clause (i)(II) that the 
                        application of this paragraph to all the 
                        categories for a reform year will result in a 
                        net aggregate increase in the aggregate Federal 
                        expenditures under subsection (a), the 
                        Secretary shall reduce the national average 
                        base per beneficiary, per category amount 
                        computed under subparagraph (A) for each of the 
                        categories determined under clause (i)(I) for 
                        which there will be an aggregate increase in 
                        the aggregate Federal expenditures under 
                        subsection (a) by such uniform percentage as 
                        will ensure that there is no net aggregate 
                        Federal expenditure increase described in 
                        clause (i)(II) for the reform year.
            ``(5) Reports on per beneficiary rates; appeals.--
                    ``(A) Report to states.--Not later than 8 months 
                after the date of the enactment of this section, the 
                Secretary shall submit to each State the Secretary's 
                initial determination of--
                            ``(i) the base per beneficiary, per 
                        category amounts under paragraph (2) for such 
                        State; and
                            ``(ii) the national average base per 
                        beneficiary, per category amounts under 
                        paragraph (4)(A).
                    ``(B) Opportunity to appeal.--Not later than 3 
                months after the date a State receives notice of the 
                Secretary's initial determination of such base per 
                beneficiary, per category amounts for such State under 
                subparagraph (A)(i), the State may file with the 
                Secretary, in a form and manner specified by the 
                Secretary, an appeal of such determination.
                    ``(C) Determination on appeal.--Not later than 3 
                months after receiving such an appeal, the Secretary 
                shall make a final determination on such amounts for 
                such State. If no such appeal is received for a State, 
                the Secretary's initial determination under 
                subparagraph (A)(i) shall become final.
            ``(6) Base fiscal year defined.--In this section, the term 
        `base fiscal year' means the latest fiscal year, ending before 
        the date of the enactment of this section, for which the 
        Secretary determines that adequate data are available to make 
        the computations required under this subsection.
    ``(d) Not Counting Individuals To Account for Excluded Payments.--
Under rules specified by the Secretary, individuals shall not be 
counted as Medicaid beneficiaries for purposes of subsection (b)(1)(B) 
and subsection (c)(2)(A) to the extent that such individuals--
            ``(1) are receiving medical assistance for which payments 
        described under subsection (a)(4)(A) are made; or
            ``(2) would not have been eligible to enroll under the 
        State plan (or waiver of such plan) in the State in which such 
        individual is so enrolled if the rules for eligibility for 
        enrollment under such plan (or waiver) were the same as such 
        rules for eligibility in effect as of January 1, 2009.
    ``(e) Risk Adjustment.--
            ``(1) In general.--The amount under subsection (a)(1)(A) 
        shall be adjusted under this subsection in an appropriate 
        manner, specified by the Secretary and consistent with 
        paragraph (2), to take into account--
                    ``(A) the factors described in subsection 
                (c)(2)(C)(i)(I) within a category of beneficiaries; and
                    ``(B) variations in costs on a county-by-county 
                basis for medical assistance and administrative 
                expenses.
            ``(2) Method of adjustment.--
                    ``(A) In general.--The adjustments under paragraph 
                (1) shall be made in a manner similar to the manner in 
                which similar adjustments are made under subsection 
                (c)(2)(C) and consistent with the requirements of 
                clause (iii) of such subsection and subparagraph (B).
                    ``(B) Biannual update of risk adjustment 
                methodology.--In applying clause (i)(I) of subsection 
                (c)(2)(C) for purposes of subparagraph (A), the 
                Secretary shall, in consultation with the entities 
                described in clause (ii)(I) of such subsection, update 
                the risk adjustment methodology applied as appropriate 
                not less often than every 2 years.
    ``(f) Chronic Care Quality Bonus Payments.--
            ``(1) Determination of bonus payments.--If the Secretary 
        determines that, based on the reports under paragraph (5), with 
        respect to categories of chronic disease for which chronic care 
        performance targets had been established under paragraph (3) 
        for each category of Medicaid beneficiaries specified under 
        subsection (b)(2) such targets have been met by a State for a 
        reform year, the Secretary shall make an additional payment to 
        such State in the amount specified in paragraph (6) for each 
        quarter in the succeeding reform year. Such payments shall be 
        made in a manner specified by the Secretary and may only be 
        used consistent with subsection (a)(3).
            ``(2) Identification of categories of chronic disease.--The 
        Secretary shall determine the categories of chronic disease for 
        which bonus payments may be available under this subsection for 
        each category of Medicaid beneficiaries.
            ``(3) Adoption of quality measurement system and 
        identification of performance targets.--
                    ``(A) System and data.--With respect to the 
                categories of chronic disease under paragraph (2), the 
                Secretary shall adopt a quality measurement system that 
                uses data described in paragraph (4) and is similar to 
                the Five-Star Quality Rating System used to indicate 
                the performance of Medicare Advantage plans under part 
                C of title XVIII.
                    ``(B) Targets.--Using such system and data, the 
                Secretary shall establish for each reform year the 
                chronic care performance targets for purposes of the 
                payments under paragraph (1). Such performance targets 
                shall be established in consultation with States, 
                associations representing individuals with chronic 
                illnesses, entities providing treatment to such 
                individuals for such chronic illnesses, and other 
                stakeholders, including the National Association of 
                Medicaid Directors and the National Governors 
                Association.
            ``(4) Data to be used.--The data to be used under paragraph 
        (3) shall include--
                    ``(A) data collected through methods such as--
                            ``(i) the `Healthcare Effectiveness Data 
                        and Information Set' (also known as `HEDIS') 
                        (or an appropriate successor performance 
                        measurement tool);
                            ``(ii) the `Consumer Assessment of 
                        Healthcare Providers and Systems' (also known 
                        as `CAHPS') (or an appropriate successor 
                        performance measurement tool); and
                            ``(iii) the `Health Outcomes Survey' (also 
                        known as `HOS') (or an appropriate successor 
                        performance measurement tool); and
                    ``(B) other data collected by the State.
            ``(5) Reports.--
                    ``(A) In general.--Each State shall collect, 
                analyze, and report to the Secretary, at a frequency 
                and in a manner to be established by the Secretary, 
                data described in paragraph (4) that permit the 
                Secretary to monitor the State's performance relative 
                to the chronic care performance targets established 
                under paragraph (3).
                    ``(B) Review and verification.--The Secretary may 
                review the data collected by the State under 
                subparagraph (A) to verify the State's analysis of such 
                data with respect to the performance targets under 
                paragraph (3).
            ``(6) Amount of bonus payments.--
                    ``(A) In general.--Subject to subparagraphs (B) and 
                (C), with respect to each category of Medicaid 
                beneficiaries, in the case of a State that the 
                Secretary determines, based on the chronic care 
                performance targets set under paragraph (3) for a 
                reform year for such category, performs--
                            ``(i) in the top five States in such 
                        category, subject to subparagraph (C)(ii), the 
                        amount of the bonus for each quarter in the 
                        succeeding reform year shall be 10 percent of 
                        the payment amount otherwise paid to the State 
                        under subsection (a) for individuals enrolled 
                        under the plan within such category;
                            ``(ii) in the next five States in such 
                        category, subject to subparagraph (C)(ii), the 
                        amount of the bonus for each such quarter shall 
                        be 5 percent of the payment amount otherwise 
                        paid to the State under subsection (a) for 
                        individuals enrolled under the plan within such 
                        category;
                            ``(iii) in the next five States in such 
                        category, subject to clauses (i) and (iii) of 
                        subparagraph (C), the amount of the bonus for 
                        each such quarter shall be 3 percent of the 
                        payment amount otherwise paid to the State 
                        under subsection (a) for individuals enrolled 
                        under the plan within such category;
                            ``(iv) in the next five States in such 
                        category, subject to clauses (i) and (iii) of 
                        subparagraph (C), the amount of the bonus for 
                        each such quarter shall be 2 percent of the 
                        payment amount otherwise paid to the State 
                        under subsection (a) for individuals enrolled 
                        under the plan within such category; and
                            ``(v) in the next five States in such 
                        category, subject to clauses (i) and (iii) of 
                        subparagraph (C), the amount of the bonus for 
                        each such quarter shall be 1 percent of the 
                        payment amount otherwise paid to the State 
                        under subsection (a) for individuals enrolled 
                        under the plan within such category.
                    ``(B) Aggregate annual limit for each category of 
                medicaid beneficiaries.--
                            ``(i) In general.--In no case may the 
                        aggregate amount of bonuses under this 
                        subsection for quarters in a reform year for a 
                        category of Medicaid beneficiaries exceed the 
                        limit specified in clause (ii) for the reform 
                        year.
                            ``(ii) Limit.--The limit specified in this 
                        clause--
                                    ``(I) for the second reform year is 
                                equal to $250,000,000; or
                                    ``(II) for a subsequent reform year 
                                is equal to the limit specified in this 
                                clause for the previous reform year 
                                increased by the per beneficiary 
                                percentage increase determined under 
                                paragraph (1)(E) of subsection (c).
                    ``(C) Limitation and proration of bonuses based on 
                application of aggregate limit.--
                            ``(i) No bonus for third or subsequent 
                        tiers unless aggregate limit not reached on 
                        first two tiers.--No bonus shall be payable 
                        under clause (iii), (iv), or (v) of 
                        subparagraph (A) for a category of Medicaid 
                        beneficiaries for a quarter in a reform year 
                        unless the aggregate amount of bonuses under 
                        clauses (i) and (ii) of such subparagraph for 
                        such category and reform year is less than the 
                        limit specified in subparagraph (B)(ii) for the 
                        reform year.
                            ``(ii) Proration for first two tiers.--If 
                        the aggregate amount of bonuses under clauses 
                        (i) and (ii) of subparagraph (A) for a category 
                        of Medicaid beneficiaries for quarters in a 
                        reform year exceeds the limit specified in 
                        subparagraph (B)(ii) for the reform year, the 
                        amount of each such bonus shall be prorated in 
                        a manner so the aggregate amount of such 
                        bonuses is equal to such limit.
                            ``(iii) Proration for next three tiers.--If 
                        the aggregate amount of bonuses under clauses 
                        (i) and (ii) of subparagraph (A) for a category 
                        of Medicaid beneficiaries for quarters in a 
                        reform year is less than the limit specified in 
                        subparagraph (B)(ii) for the reform year, but 
                        the aggregate amount of bonuses under clauses 
                        (i) through (v) of subparagraph (A) for the 
                        category and such quarters in the reform year 
                        exceeds the limit specified in subparagraph 
                        (B)(ii) for the reform year, the amount of each 
                        bonus in clauses (iii), (iv), and (v) of 
                        subparagraph (A) shall be prorated in a manner 
                        so the aggregate amount of all the bonuses 
                        under subparagraph (A) is equal to such limit.
    ``(g) State Option for Receiving Medicare Payments for Full-Benefit 
Dual Eligible Individuals.--
            ``(1) In general.--Under this subsection a State may elect 
        for quarters beginning on or after the implementation date in a 
        reform year to receive payment from the Secretary under 
        paragraph (3). As a condition of receiving such payment, the 
        State shall agree to provide to full-benefit dual eligible 
        individuals eligible for medical assistance under the State 
        plan--
                    ``(A) the medical assistance to which such eligible 
                individuals would otherwise be entitled under this 
                title; and
                    ``(B) any items and services which such eligible 
                individuals would otherwise receive under title XVIII.
            ``(2) Provider payment requirement.--
                    ``(A) In general.--A State electing the option 
                under this subsection shall provide payment to health 
                care providers for the items and services described 
                under paragraph (1)(B) at a rate that is not less than 
                the rate at which payments would be made to such 
                providers for such items and services under title 
                XVIII.
                    ``(B) Flexibility in payment methods.--Nothing in 
                subparagraph (A) shall be construed as preventing a 
                State from using alternative payment methodologies 
                (such as bundled payments or the use of accountable 
                care organizations (as such term is used in section 
                1899)) for purposes of making payments to health care 
                providers for items and services provided to dual 
                eligible individuals in the State under the option 
                under this subsection.
            ``(3) Payments to states in lieu of medicare payments.--
        With respect to a full-benefit dual eligible individual, in the 
        case of a State that elects the option under paragraph (1) for 
        quarters in a reform year--
                    ``(A) the Secretary shall not make any payment 
                under title XVIII for items and services furnished to 
                such individual for such quarters; and
                    ``(B) the Secretary shall pay to the State, in 
                addition to the amounts paid to such State under 
                subsection (a), the amount that the Secretary would, 
                but for this subsection, otherwise pay under title 
                XVIII for items and services furnished to such an 
                individual in such State for such quarters.
            ``(4) Full-benefit dual eligible individual defined.--In 
        this subsection, the term `full-benefit dual eligible 
        individual' means an individual who meets the requirements of 
        section 1935(c)(6)(A)(ii).
    ``(h) Audits.--The Secretary shall conduct such audits on the 
number and classification of Medicaid beneficiaries under such 
subsections and expenditures under this section as may be necessary to 
ensure appropriate payments under this section.
    ``(i) Treatment of Waivers.--
            ``(1) No impact on current waivers.--In the case of a 
        waiver of requirements of this title pursuant to section 1115 
        or other law that is in effect as of the date of the enactment 
        of this section, nothing in this section shall be construed to 
        affect such waiver for the period of the waiver as approved as 
        of such date.
            ``(2) Application of budget neutrality to subsequent 
        waivers and renewals taking section into account.--In the case 
        of a waiver of requirements of this title pursuant to section 
        1115 or other law that is approved or renewed after the date of 
        the enactment of this section, to the extent that such approval 
        or renewal is conditioned upon a demonstration of budget 
        neutrality, budget neutrality shall be determined taking into 
        account the application of this section.
    ``(j) Report to Congress.--Not later than January 1 of the second 
reform year, the Secretary shall submit to Congress a report on the 
implementation of this section.
    ``(k) Definitions.--In this section:
            ``(1) Implementation date.--The term `implementation date' 
        means--
                    ``(A) July 1, 2023, if this section is enacted on 
                or before July 1, 2022; or
                    ``(B) July 1, 2024, if this section is enacted 
                after July 1, 2022.
            ``(2) Reform years.--
                    ``(A) The term `reform year' means a fiscal year 
                beginning with the first reform year.
                    ``(B) The term `first reform year' means the fiscal 
                year in which the implementation date occurs.
                    ``(C) The terms `second', `third', and successive 
                similar terms mean, with respect to a reform year, the 
                second, third, or successive reform year, respectively, 
                succeeding the first reform year.''.
    (b) Conforming Amendments.--
            (1) Continued application of clawback provisions.--
                    (A) Continued application.--Subsections (a) and 
                (c)(1)(C) of section 1935 of such Act (42 U.S.C. 1396u-
                5) are each amended by inserting ``or 1903A(a)'' after 
                ``1903(a)''.
                    (B) Technical amendment.--Section 1935(d)(1) of the 
                Social Security Act (42 U.S.C. 1396u-5(d)(1)) is 
                amended by inserting ``except as provided in section 
                1903A(g)'' after ``any other provision of this title''.
            (2) Payment rules under section 1903.--
                    (A) Section 1903(a) of the Social Security Act (42 
                U.S.C. 1396b(a)) is amended, in the matter before 
                paragraph (1), by inserting ``and section 1903A'' after 
                ``except as otherwise provided in this section''.
                    (B) Section 1903(d) of such Act (42 U.S.C. 
                1396b(d)) is amended--
                            (i) in paragraph (1), by inserting ``and 
                        under section 1903A'' after ``subsections (a) 
                        and (b)'';
                            (ii) in paragraph (2)--
                                    (I) in subparagraph (A), by 
                                inserting ``or section 1903A'' after 
                                ``was made under this section''; and
                                    (II) in subparagraph (B), by 
                                inserting ``or section 1903A'' after 
                                ``under subsection (a)'';
                            (iii) in paragraph (4)--
                                    (I) by striking ``under this 
                                subsection'' and inserting ``, with 
                                respect to this section or section 
                                1903A, under this subsection''; and
                                    (II) by striking ``under this 
                                section'' and inserting ``under the 
                                respective section''; and
                            (iv) in paragraph (5), by inserting ``or 
                        section 1903A'' after ``overpayment under this 
                        section''.
            (3) Conforming waiver authority.--Section 1115(a)(2)(A) of 
        the Social Security Act (42 U.S.C. 1315(a)(2)(A)) is amended by 
        striking ``or 1903'' and inserting ``1903, or 1903A''.
            (4) Report on additional conforming amendments needed.--Not 
        later than 6 months after the date of the enactment of this 
        Act, the Secretary of Health and Human Services shall submit to 
        Congress a report that includes a description of any additional 
        technical and conforming amendments to law that are required to 
        properly carry out this Act.

SEC. 402. INCOME LIMITATIONS FOR REFUNDABLE CREDITS FOR COVERAGE UNDER 
              A QUALIFIED HEALTH PLAN.

    (a) In General.--Subparagraphs (A) and (B) of section 36B(c)(1) of 
the Internal Revenue Code of 1986 are amended by inserting after ``100 
percent'' each place such term appears the following: ``(or, in the 
case of a taxpayer enrolled through an Exchange utilized by such State 
that makes the election described in section 1903A of the Social 
Security Act, the percentage established by such State under part A of 
title IV of such Act for purposes of eligibility under title XIX of 
such Act as of January 1, 2009)''.
    (b) Effective Date.--The amendments made by this section shall 
apply with respect to taxable years beginning after the date of the 
enactment of this Act.

SEC. 403. MEDICAID ELIGIBILITY DETERMINATIONS.

    (a) State Flexibility To Use Contractors To Make Eligibility 
Determinations on Behalf of State.--Section 1902(a)(5) of the Social 
Security Act (42 U.S.C. 1396a(a)(5)) is amended by inserting before the 
semicolon at the end the following: ``, but such determinations of 
eligibility may be made, at the option of a State, under a contract 
with another State or local agency or a contractor so long as the 
contract does not provide incentives for the agency or contractor to 
delay eligibility determinations or to deny eligibility for individuals 
otherwise eligible for medical assistance''.
    (b) Frequency of Eligibility Redeterminations.--Section 1902(e)(14) 
of the Social Security Act (42 U.S.C. 1396a(e)(14)) is amended by 
adding at the end the following:
                    ``(L) Frequency of eligibility redeterminations.--
                Beginning on October 1, 2022, and notwithstanding 
                subparagraph (H), in the case of an individual whose 
                eligibility for medical assistance under the State plan 
                under this title (or a waiver of such plan) is 
                determined based on the application of modified 
                adjusted gross income under subparagraph (A) and who is 
                so eligible on the basis of clause (i)(VIII), (ii)(XX), 
                or (ii)(XXIII) of subsection (a)(10)(A), at the option 
                of the State, the State plan may provide that the 
                individual's eligibility shall be redetermined every 6 
                months (or such shorter number of months as the State 
                may elect).''.

SEC. 404. LOWERING SAFE HARBOR THRESHOLD WITH RESPECT TO STATE TAXES ON 
              HEALTH CARE PROVIDERS.

     Section 1903(w)(4)(C)(ii) of the Social Security Act (42 U.S.C. 
1396b(w)(4)(C)(ii)) is amended--
            (1) by striking ``of fiscal years beginning'' and inserting 
        ``of fiscal years--
                    ``(I) beginning''; and
            (2) by striking ``it appears.'' and inserting the 
        following: ``it appears;
                    ``(II) beginning on or after January 1, 2021, and 
                before January 1, 2030, `4 percent' shall be 
                substituted for `6 percent' each place it appears;
                    ``(III) beginning on or after January 1, 2030, and 
                before January 1, 2035, `3 percent' shall be 
                substituted for `6 percent' each place it appears;
                    ``(IV) beginning on or after January 1, 2035, and 
                before January 1, 2040, `2 percent' shall be 
                substituted for `6 percent' each place it appears;
                    ``(V) beginning on or after January 1, 2040, and 
                before January 1, 2045, `1 percent' shall be 
                substituted for `6 percent' each place it appears; and
                    ``(VI) beginning on or after January 1, 2045, `0 
                percent' shall be substituted for `6 percent' each 
                place it appears.''.

SEC. 405. PROVIDING FOR STATE APPROVAL AND IMPLEMENTATION OF SPECIFIED 
              WAIVERS UNDER THE MEDICAID PROGRAM.

    Section 1115 of the Social Security Act (42 U.S.C. 1315) is 
amended--
            (1) in subsection (d)--
                    (A) in paragraph (1), by striking ``An 
                application'' and inserting ``Subject to paragraph (4), 
                an application''; and
                    (B) by adding at the end the following new 
                paragraph:
            ``(4)(A) An experimental, pilot, or demonstration project 
        undertaken under subsection (a) may be approved or renewed by a 
        State if such project is described in subparagraph (B).
            ``(B) An experimental, pilot, or demonstration project is 
        described in this subparagraph if such project provides for a 
        waiver of requirements with respect to a State plan (or a 
        waiver of such plan) under title XIX such that--
                    ``(i) individuals enrolled under such plan (or such 
                waiver) may elect to participate in such project with 
                respect to a year; and
                    ``(ii) such individuals who elect to so participate 
                are furnished with primary care services (as described 
                in section 223(c)(1)(D)(ii)(I) of the Internal Revenue 
                Code of 1986) through a direct primary care service 
                arrangement (as defined in such section).
            ``(C) For purposes of a State's approval or renewal of an 
        experimental, pilot, or demonstration project under 
        subparagraph (A), each reference to `the Secretary' in 
        subsection (a) shall be deemed to be a reference to `the 
        State'.''; and
            (2) in subsection (e), by inserting ``(other than such a 
        project that is described in paragraph (4)(B))'' before the 
        period at the end.

SEC. 406. DEDUCTION FOR QUALIFIED CHARITY CARE.

    (a) In General.--Part VI of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 is amended by adding at the end the 
following new section:

``SEC. 199B. QUALIFIED CHARITY CARE.

    ``(a) In General.--There shall be allowed as a deduction for the 
taxable year an amount equal to--
            ``(1) in the case of a direct primary care physician, an 
        amount equal to the sum of--
                    ``(A) the fee (as published on a publicly available 
                website of such physician) for physicians' services 
                that are qualified charity care furnished by such 
                taxpayer during such year, and
                    ``(B) for each visit by a patient to such physician 
                during which qualified charity care is furnished, half 
                of so much of the lowest subscription fee of such 
                physician that is attributable to a month, and
            ``(2) in the case of any other individual, the unreimbursed 
        Medicare-based value of qualified charity care furnished by 
        such taxpayer during such year.
    ``(b) Definitions.--For purposes of this section:
            ``(1) Unreimbursed medicare-based value.--The term 
        `unreimbursed Medicare-based value' means, with respect to 
        physicians' services, the amount payable for such services 
        under the physician fee schedule established under section 1848 
        of the Social Security Act.
            ``(2) Qualified charity care.--The term `qualified charity 
        care' means physicians' services that are furnished--
                    ``(A) without expectation of reimbursement, and
                    ``(B) to an individual enrolled--
                            ``(i) under a State plan under title XIX of 
                        the Social Security Act (or a waiver of such 
                        plan), or
                            ``(ii) under a State child health plan 
                        under title XXI of the Social Security Act (or 
                        a waiver of such plan).
            ``(3) Direct primary care physician.--The term `direct 
        primary care physician' means a physician (as defined in 
        section 1861(r) of the Social Security Act) who provides 
        primary care--
                    ``(A) to individuals who have paid a periodic 
                subscription fee, and
                    ``(B) in exchange for a fee that is published on a 
                publicly available website of such physician.
            ``(4) Physicians' services.--The term `physicians' 
        services' has the meaning given such term by section 1861(q) of 
        the Social Security Act.
    ``(c) Limitation.--The amount allowed as a deduction under 
subsection (a) for a taxable year shall not exceed the gross receipts 
attributable to physicians' services furnished by the taxpayer during 
the taxable year.''.
    (b) Clerical Amendment.--The table of sections for part VI of 
subchapter B of chapter 1 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new item:

``Sec. 199B. Qualified charity care.''.

                      Subtitle B--Medicare Reforms

SEC. 411. OFF-CAMPUS PROVIDER-BASED DEPARTMENT MEDICARE SITE NEUTRAL 
              PAYMENT.

    (a) In General.--Section 1834 of the Social Security Act (42 U.S.C. 
1395m) is amended by adding at the end the following new subsection:
    ``(x) Off-Campus Provider-Based Department Medicare Site Neutral 
Payment.--
            ``(1) In general.--With respect to items and services 
        furnished in an off-campus provider-based department, payment 
        under this section for such items and services shall be the 
        amount determined under the fee schedule under section 1848 for 
        such items and services furnished if furnished in a physician 
        office setting.
            ``(2) Off-campus provider-based department.--For purposes 
        of this subsection, the term `off-campus provider-based 
        department' has such meaning as specified by the Secretary.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply with respect to items and services furnished on or after January 
1, 2023.

SEC. 412. ELIMINATING FEHBP ELIGIBILITY FOR ANNUITANTS.

    Section 8905(b) of title 5, United States Code, is amended--
            (1) in the matter preceding paragraph (1), by striking 
        ``An'' and inserting ``Consistent with the last sentence of 
        this subsection, an''; and
            (2) by adding at the end the following: ``. An individual 
        who is entitled to benefits under part A of title XVIII of the 
        Social Security Act (42 U.S.C. 1395c et seq.) by reason of 
        section 226 or 226A of such Act (42 U.S.C. 426, 426-1), or 
        otherwise eligible to enroll under such part pursuant to 
        section 1818 or 1818A of such Act (42 U.S.C. 1395i-2, 1395i-
        2a), and who first becomes an annuitant after the date of 
        enactment of this sentence may not continue enrollment in any 
        health benefits plan under this chapter.''.

SEC. 413. ELIMINATION OF MEDICARE ELIGIBILITY FOR CERTAIN INDIVIDUALS.

    (a) Enrollment Prohibition.--
            (1) Part b.--Section 1836 of the Social Security Act (42 
        U.S.C. 1395o) is amended by striking the period at the end and 
        inserting ``, except that an individual who attains age 65 on 
        or after January 1, 2032, and is an individual who, upon 
        attaining such age, has earned $10,000,000 or more in lifetime 
        wages, shall not be eligible to so enroll.''.
            (2) Part d.--Section 1860D-1(a)(3)(A) of such Act (42 
        U.S.C. 1395w-101(a)(3)(A)) is amended by striking the period at 
        the end and inserting ``, excluding an individual who, upon 
        attaining age 65, has earned $10,000,000 or more in lifetime 
        wages.''.
    (b) Medigap.--Section 1882 of the Social Security Act (42 U.S.C. 
1395ss) is amended by adding at the end the following new subsection:
    ``(aa) Additional Limitation on Newly Eligible Beneficiaries.--
            ``(1) In general.--Notwithstanding any other provision of 
        this section, on or after January 1, 2032, a medicare 
        supplemental policy may not be sold or issued to a targeted 
        newly eligible Medicare beneficiary.
            ``(2) Targeted newly eligible medicare beneficiary.--For 
        purposes of this subsection, the term `targeted newly eligible 
        Medicare beneficiary' means an individual who, upon attaining 
        the age of 65, has earned $10,000,000 or more in lifetime 
        wages.''.

SEC. 414. MEDICARE PART D TAX DEDUCTION.

    (a) In General.--Section 139A of the Internal Revenue Code of 1986 
is amended by adding at the end the following: ``This section shall not 
be taken into account for purposes of determining whether any deduction 
is allowable with respect to any cost taken into account in determining 
such payment.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2022.

SEC. 415. REPEAL OF NET INVESTMENT INCOME TAX.

    (a) In General.--Subtitle A of the Internal Revenue Code of 1986 is 
amended by striking chapter 2A.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2022.

SEC. 416. MEDICARE COVERAGE OF BAD DEBT.

    Section 1861(v)(1) of the Social Security Act (42 U.S.C. 
1395(v)(1)) is amended--
            (1) in subparagraph (T)--
                    (A) in clause (iv), by striking ``and'' at the end;
                    (B) in clause (v)--
                            (i) by striking ``during fiscal year'' and 
                        inserting ``during fiscal years'';
                            (ii) by striking ``or a subsequent fiscal 
                        year'' and inserting ``through 2023''; and
                            (iii) by striking the period at the end and 
                        inserting ``, and''; and
                    (C) by adding at the end the following new clause:
            ``(vi) for cost reporting periods beginning during fiscal 
        year 2023 or a subsequent fiscal year, by the percent 
        applicable for cost reporting periods beginning during the 
        previous fiscal year, increased (through fiscal year 2026) by 
        10 percentage points.'';
            (2) in subparagraph (V)--
                    (A) in clause (i)--
                            (i) in subclause (III), by striking ``and'' 
                        at the end;
                            (ii) in subclause (IV)--
                                    (I) by striking ``during fiscal 
                                year'' and inserting ``during fiscal 
                                years 2017 through 2023''; and
                                    (II) by striking the period at the 
                                end and inserting ``; and''; and
                            (iii) by adding at the end the following 
                        new subclause:
                    ``(V) for cost reporting periods beginning during 
                fiscal year 2021 or a subsequent fiscal year, the 
                percent applicable for cost reporting periods beginning 
                during the previous fiscal year, increased (through 
                fiscal year 2024) by 10 percentage points.''; and
                    (B) in clause (ii)--
                            (i) in subclause (III), by striking ``and'' 
                        at the end; and
                            (ii) in subclause (IV)--
                                    (I) by striking ``a subsequent 
                                fiscal year'' and inserting ``fiscal 
                                years 2015 through 2021'';
                                    (II) by striking the period at the 
                                end and inserting ``; and''; and
                                    (III) by adding at the end the 
                                following new subclause:
                    ``(V) for cost reporting periods beginning during 
                fiscal year 2021 or a subsequent fiscal year, shall be 
                reduced by the percent applicable for cost reporting 
                periods beginning during the previous fiscal year, 
                increased (through fiscal year 2024) by 10 percentage 
                points.''; and
            (3) in subparagraph (W)(i)--
                    (A) in subclause (II), by striking ``and'' at the 
                end;
                    (B) in subclause (III)--
                            (i) by striking ``during a subsequent 
                        fiscal year'' and inserting ``during fiscal 
                        years 2015 through 2021''; and
                            (ii) by striking the period at the end and 
                        inserting ``; and''; and
                    (C) by adding at the end the following new 
                subclause:
            ``(IV) for cost reporting periods beginning during fiscal 
        year 2021 or a subsequent fiscal year, by the percent 
        applicable for cost reporting periods beginning during the 
        previous fiscal year, increased (through fiscal year 2024) by 
        10 percentage points.''.

              Subtitle C--Medicare Choice and Competition

SEC. 421. COMPETITIVE BIDDING AND PREMIUMS UNDER UNIFIED MEDICARE.

    (a) In General.--Part E of title XVIII of the Social Security Act, 
as added by section 101 and amended by section 103, is further amended 
by adding at the end the following:

             ``Subpart 3--Competitive Bidding and Premiums

``SEC. 1860E-31. APPLICATION OF COMPETITIVE BIDDING IN ENROLLMENT.

    ``(a) In General.--Notwithstanding any other provision of this 
title, the Secretary shall, beginning with plan year 2023, establish a 
method whereby individuals enrolling under this title so enroll through 
an online process designed to highlight enrollment options for such 
individuals and allow such individuals to compare costs of enrollment 
in such options.
    ``(b) Enrollment Options.--For purposes of subsection (a), the 
Secretary shall make the following options available to individuals for 
enrollment under this title:
            ``(1) Traditional fee-for-service coverage.
            ``(2) Provider-led risk-bearing plans (also known as ACOs).
            ``(3) Medicare Advantage plans.
    ``(c) Medicare Advantage Plan Actuarial Value Requirement.--Each 
Medicare Advantage plan offered through the process described in 
subsection (a) shall have an actuarial value equal to traditional fee-
for-service coverage under parts A and B.
    ``(d) MA Direct Deposit of Certain Rebates.--In the case of an 
Medicare Advantage plan with a bid for a year that involves a premium 
differential between such bid and the benchmark for such year and plan, 
such plan shall provide for a direct deposit of such differential if 
the applicable enrollee in such plan does not elect any supplemental 
coverage under such plan.
    ``(e) Enrollment in Prescription Drug Coverage.--As part of the 
method described in subsection (a), the Secretary shall establish a 
process to allow an individual to enroll in prescription drug coverage. 
In the case of an individual who enrolls in a Medicare Advantage plan, 
such coverage shall be provided under such plan. In a case of an 
individual who enrolls in an ACO, such coverage shall be provided under 
such network. In the case of an individual who enrolls under 
traditional fee-for-service coverage, such drug coverage shall be 
provided through a prescription drug plan.
    ``(f) Supplemental Benefits.--
            ``(1) MA plans.--An MA plan is allowed to offer two 
        different packages of supplemental benefits (these packages are 
        available only to individuals who select such plans).
            ``(2) ACOs.--ACOs may limit supplemental options for their 
        enrollees to Medigap plans with contractual ties.
            ``(3) Fee-for-service.--Fee-for-service individuals may 
        select supplemental coverage from Medigap policies.

``SEC. 1860E-32. COMPETITION.

    ``(a) Bid Areas.--Market areas used for bid submissions for 
Medicare Advantage plans, ACOs, and for calculation per person fee-for-
services costs shall be metropolitan statistical regions plus 
associated regions.
    ``(b) Premiums.--Medicare payment benchmark by market area shall be 
calculated based on weighted average (by enrollment in previous year) 
of the premium bids from MA plans, ACOs, and the per person costs of 
fee-for-service, less the statutory part B premium.
    ``(c) Beneficiary Responsibility.--Beneficiaries shall pay the 
difference between Medicare payment and required premium of the plan 
they choose, and get 100 percent of the savings by choosing a plan with 
a premium below the benchmark.
    ``(d) Transition.--For beneficiaries who are in fee-for-service at 
the time of the enactment of this section, there shall be a limit on 
the amount of a premium increase allowable by year of no more than $20 
per month compared to what such premium would have otherwise been if 
this subpart had not been enacted for each year through the fifth year.
    ``(e) Multiyear Contracts.--A Medicare Advantage plan may offer to 
beneficiaries multiyear contracts with guaranteed premiums over such 
years, bearing the risk of any change in payments from the Secretary in 
subsequent years. A beneficiary enrolling under such a contract shall 
be exempt from the method described in subsection (a).''.
    (b) Conforming Amendments.--
            (1) Section 1853(a)(1)(A) of the Social Security Act is 
        amended by striking ``and section 1859(e)(4)'' and inserting 
        ``, section 1859(e)(4), and subpart 3 of part E''.
            (2) Section 1853(j) of such Act is amended by inserting 
        ``and subpart 3 of part E'' after ``subsection (o)''.
            (3) Section 1854 of such Act is amended--
                    (A) in subsection (a), after the heading, by 
                inserting ``Subject to subpart 3 of part E:'';
                    (B) in subsection (b), after the heading, by 
                inserting ``Subject to subpart 3 of part E:'';
                    (C) in subsection (d), after the heading, by 
                inserting ``Subject to subpart 3 of part E:''; and
                    (D) in subsection (e), after the heading, by 
                inserting ``Subject to subpart 3 of part E:''.

SEC. 422. NEW UNIFIED ELIGIBILITY AND ENROLLMENT RULES.

    (a) In General.--Title XVIII of the Social Security Act is 
amended--
            (1) by redesignating part E as part F; and
            (2) by inserting after part D the following new part:

             ``PART E--MEDICARE WITH CHOICE AND COMPETITION

                ``Subpart 1--Opt-Out and Auto-Enrollment

``SEC. 1860E-11. PART A OPT-OUT AND MA AUTO-ENROLLMENT.

    ``(a) Permitting Individuals To Opt Out of Part A Coverage Without 
Losing Social Security Benefits.--
            ``(1) In general.--The Secretary shall establish--
                    ``(A) a process by which an individual otherwise 
                entitled to benefits under part A may elect (at a time 
                and in a manner specified under the process) to waive 
                such entitlement; and
                    ``(B) a process by which an individual who elects 
                to waive such entitlement may revoke (at a time and in 
                a manner specified under the process) such waiver.
        The process under subparagraph (B) shall be coordinated with 
        the enrollment process under section 1837 for part B.
            ``(2) Application of late enrollment penalty.--An 
        individual who revokes a waiver under paragraph (1)(B) shall be 
        subject to a late enrollment penalty as applied under section 
        1860E-32(c)(2)(C).
            ``(3) No impact on title ii benefits.--Notwithstanding any 
        other provision of law, an election of an individual to waive 
        entitlement to benefits under part A under paragraph (1)(A) 
        shall not result in any loss of benefits under title II.
            ``(4) Deemed opt-out.--
                    ``(A) An election of an individual to waive 
                entitlement to benefits under part A under paragraph 
                (1)(A) is also deemed the filing of a notice of 
                termination of benefits under part B pursuant to 
                section 1838(b)(1).
                    ``(B) The termination of benefits under part B 
                pursuant to section 1838(b) is also deemed to be a 
                waiver of any entitlement to benefits under part A.
    ``(b) Special Open Enrollment Period Without Late Enrollment 
Penalty for Current Part A Only or Part B Only Enrollees.--
Notwithstanding any other provision of law, in the case of an 
individual who as of the general effective date, is entitled to 
benefits under part A but not enrolled under part B, or who is enrolled 
under part B but not entitled to benefits (or enrolled) under part A, 
beginning as of such date, such individual shall be deemed to be 
enrolled under part B or part A, respectively, unless such individual 
elects to be enrolled (or entitled to benefits) under neither of such 
parts during a special open enrollment period specified by the 
Secretary. No increase in the monthly premium of an individual pursuant 
to section 1839(b) or section 1818(c) shall be effected in the case of 
any such individual who is deemed enrolled under part B or part A 
pursuant to the previous sentence with respect to any period prior to 
the date of such enrollment.
    ``(c) Auto Enrollment of Dual Eligible Individuals Under Medicare 
Advantage Plans.--
            ``(1) In general.--Except in the case of a State that has 
        elected the maintenance of effort option described in section 
        1944(b)(2), in the case of an individual described in 
        subparagraph (A)(ii) of section 1935(c)(6) (taking into account 
        the application of subparagraph (B) of such section), the 
        Secretary shall establish a process for the enrollment in an 
        MA-PD plan that is a managed care plan under part C that has a 
        monthly beneficiary premium that does not exceed the premium 
        assistance available under section 1860E-41(b)(1)(A). If there 
        is more than one such plan available, the Secretary shall 
        enroll such an individual on a random basis among all such 
        plans in the PDP region.
            ``(2) Right to disenroll.--Nothing in paragraph (1) shall 
        prevent such an individual from declining enrollment in any 
        such plan (and thereby obtaining coverage under Medicare fee-
        for-service) or from changing enrollment in such a plan to 
        another MA-PD plan.

``SEC. 1860E-12. COORDINATION WITH PART D.

    ``(a) Deemed Enrollment Under Part D.--
            ``(1) In general.--The Secretary shall establish a process 
        that, beginning as of the general effective date, provides for 
        the enrollment in a prescription drug plan that has a monthly 
        base beneficiary premium that does not exceed the weighted 
        average of premiums for such plans that provide standard 
        prescription drug coverage (as defined in section 1860D-2(b)) 
        with respect to the area involved (on a random basis among all 
        such plans in the applicable PDP region) of each Medicare 
        enrollee (as defined in section 1860E-51) who--
                    ``(A) failed to enroll in such a prescription drug 
                plan during the applicable enrollment or coverage 
                election period under section 1860D-1(b); and
                    ``(B) failed to elect not to enroll in such a 
                prescription drug plan during an applicable opt-out 
                period described in paragraph (2).
        Nothing in the previous sentence shall prevent such an 
        individual from declining or changing such enrollment. Such 
        process shall be carried out in the same manner as the process 
        described in section 1860D-1(b)(1)(C).
            ``(2) Opt-out periods.--The process under paragraph (1) 
        shall provide for the opportunity to make an election described 
        in subparagraph (B) of such paragraph during an opt-out period 
        that is coordinated with the relevant enrollment or coverage 
        election period under section 1860D-1.
            ``(3) Late enrollment penalties.--In the case of an 
        individual who makes an election described in paragraph (1)(B) 
        and then enrolls in a prescription drug plan, the late 
        enrollment penalty under section 1860D-13(b) shall apply to the 
        monthly beneficiary premium of such individual, except that in 
        applying such section, any reference to the initial enrollment 
        period of such individual shall be deemed to be a reference to 
        the opt-out period under paragraph (2) during which the 
        individual elected not to enroll in a prescription drug plan.
            ``(4) No late enrollment penalty for current fee-for-
        service beneficiaries without drug coverage.--In the case of an 
        individual who is a Medicare enrollee before the date of 
        enactment of this section and who was not enrolled under a 
        prescription drug plan before being enrolled under such a plan 
        pursuant to paragraph (1), there shall be no increase in the 
        base beneficiary premium of an individual under section 1860D-
        13 by a late enrollment penalty under subsection (b) of such 
        section with respect to any period prior to the date of such 
        enrollment.
    ``(b) Reference to Required Prescription Drug Coverage Under Part 
C.--For provision requiring coverage under MA plans to include 
prescription drug coverage, see section 1860E-26.''.
    (b) Limitation on Medicaid Benefits for Full-Benefit Dual Eligible 
Individuals.--Section 1902 of the Social Security Act (42 U.S.C. 1396a) 
is amended by adding at the end the following new subsection:
    ``(ll) Limitation on Benefits for Full-Benefit Dual Eligible 
Individuals.--Effective as of the general effective date (as specified 
in section 1860E-62), except in the case of a State which has elected 
the option described in section 1944(b)(2), in the case of an 
individual described in subparagraph (A)(ii) of section 1935(c)(6) 
(taking into account the application of subparagraph (B) of such 
section), notwithstanding any other provision of law, medical 
assistance shall not be available under this title for any items and 
services for which payment may be made under title XVIII.''.
    (c) Medicaid Maintenance of Effort and Alternatives.--Title XIX of 
the Social Security Act is amended by inserting after section 1943 the 
following new section:

    ``maintenance of effort options for full-benefit dual eligible 
                              individuals

    ``Sec. 1944.  (a) In General.--Effective as of the general 
effective date (as specified in section 1860E-62), a State shall elect, 
in a form and manner specified by the Secretary, a maintenance of 
effort option described in subsection (b). In the case of a State that 
fails to make such an election, the State shall be deemed to have 
elected the option described in subsection (b)(3).
    ``(b) Maintenance of Effort Options Described.--The following are 
maintenance of effort options described in this subsection for a State, 
which shall apply to all individuals described in subparagraph (A)(ii) 
of section 1935(c)(6) (taking into account the application of 
subparagraph (B) of such section) for such State:
            ``(1) Enrollment of dual eligibles in comprehensive 
        medicaid managed care plan.--
                    ``(A) In general.--The State enrolls all such 
                individuals in a comprehensive Medicaid managed care 
                plan offered by a managed care entity under section 
                1932.
                    ``(B) Payment of subsidy amount to state.--In the 
                case of a State that elects the option under this 
                paragraph with respect to an individual, the Secretary 
                established under section 1860E-51 shall pay to the 
                State the same amount that the individual would be 
                entitled to have paid as an income-related premium 
                subsidy under section 1860E-41(b)(1)(A) plus the amount 
                that the Secretary estimates would have been paid with 
                respect to the individual under part D (including the 
                actuarial value of subsidy payments under sections 
                1860D-13 and 1860D-14). Such payment shall be made in 
                appropriate part from the Federal Hospital Insurance 
                Trust Fund under section 1817 and the Federal 
                Supplementary Medical Insurance Trust Fund under 
                section 1841.
                    ``(C) Relation to part d rules.--In the case of a 
                State that has elected the option under this paragraph, 
                notwithstanding any other provision of law--
                            ``(i) the coverage provided under this 
                        option shall be in lieu of any coverage that 
                        may otherwise be provided under part D; and
                            ``(ii) the payment to the State under 
                        subparagraph (B) shall be in lieu of any 
                        payments otherwise made with respect to such 
                        individual under such part.
            ``(2) Other innovative alternatives.--
                    ``(A) In general.--The State submits to the 
                Secretary, and has approved by the Secretary, an 
                innovative alternative proposal relating to 
                coordinating coverage of such individuals under 
                Medicare and the State plan under title XIX.
                    ``(B) Process for review.--With respect to 
                proposals submitted to the Secretary under subparagraph 
                (A), the Secretary shall approve such a proposal if the 
                State demonstrates with respect to the proposal that--
                            ``(i) there would be no increased cost to 
                        the Federal Government if it were approved; and
                            ``(ii) there would be no reduction in the 
                        quality of care provided to such individuals if 
                        the proposal were approved.''.
    (d) Conforming Amendments.--
            (1) Section 226.--Section 226 of the Social Security Act 
        (42 U.S.C. 426) is amended--
                    (A) in subsection (a), in the matter preceding 
                paragraph (1), by inserting ``, subject to section 
                1860E-11(a)'' after ``individual who'';
                    (B) in subsection (b), in the matter preceding 
                paragraph (1), by inserting ``, subject to section 
                1860E-11(a)'' after ``individual who''; and
                    (C) in subsection (c), in the matter preceding 
                paragraph (1), by inserting ``, subject to section 
                1860E-11(a)'' after ``subsection (a)''.
            (2) Section 226A.--Section 226A(a) of such Act (42 U.S.C. 
        426-1(a)) is amended, in the matter preceding paragraph (1), by 
        inserting ``and subject to section 1860E-11(a)'' after ``or 
        title XVIII''.
            (3) Section 1932.--Section 1932(a)(2)(B) of the Social 
        Security Act (42 U.S.C. 1396u-2(a)(2)(B)) is amended by 
        striking ``A State'' and inserting ``Except in the case of a 
        State that has elected the maintenance of effort option 
        described in section 1944(b)(2), a State''.

SEC. 423. NEW BENEFIT STRUCTURE UNDER UNIFIED MEDICARE.

    (a) In General.--Part E of title XVIII of the Social Security Act, 
as added by section 251, is amended by adding at the end the following:

                    ``Subpart 2--Out-of-Pocket Limit

``SEC. 1860E-21. OUT-OF-POCKET LIMIT.

    ``(a) In General.--Beginning with 2023, in the case of a Medicare 
enrollee, if the amount of the out-of-pocket cost-sharing of such 
enrollee for a calendar year equals or exceeds the catastrophic limit 
under subsection (b) for that year--
            ``(1) the enrollee shall not be responsible for additional 
        out-of-pocket cost-sharing incurred during that year; and
            ``(2) the Secretary shall establish procedures under which 
        the Secretary shall, in appropriate part from the Part A 
        Medicare FFS Account under section 1817 and the Part B Medicare 
        FFS Account under section 1841--
                    ``(A) pay on behalf of the enrollee the amount of 
                the additional out-of-pocket cost-sharing described in 
                paragraph (1) attributable to deductibles and 
                coinsurance described in subsection (c)(1); and
                    ``(B) reimburse the enrollee the amount of the 
                additional out-of-pocket cost-sharing described in 
                paragraph (1) attributable to deductibles and 
                coinsurance described in subsection (c)(2).
    ``(b) Catastrophic Limit.--The amount of the catastrophic limit 
under this subsection for a year shall be the dollar amount in effect 
under section 223(c)(2)(A)(ii) of the Internal Revenue Code of 1986 for 
self-only coverage for taxable years beginning in such year.
    ``(c) Out-of-Pocket Cost-Sharing Defined.--In this section, the 
term `out-of-pocket cost-sharing' means, with respect to an individual, 
the amount of costs incurred by the individual that are attributable 
to--
            ``(1) deductibles and coinsurance imposed under part A or 
        part B; and
            ``(2) deductibles and coinsurance imposed under standard 
        prescription drug coverage pursuant to section 1860D-2(b) or 
        alternative prescription drug coverage pursuant to section 
        1860D-2(c) offered by a prescription drug plan.''.
    (b) Application of Out-of-Pocket Limit to MA-PD Plans.--
            (1) In general.--Section 1852(a)(1)(B) of the Social 
        Security Act (42 U.S.C. 1395w-22(a)(1)(B)) is amended--
                    (A) in clause (i), by striking ``clause (iii)'' and 
                inserting ``clauses (iii) and (vi)''; and
                    (B) by adding at the end the following new clause:
                            ``(vi) Out-of-pocket limit.--The provisions 
                        of section 1860E-21--
                                    ``(I) shall apply to individuals 
                                enrolled under an MA-PD plan in the 
                                same manner as such provisions apply to 
                                Medicare enrollees under such section, 
                                except that in lieu of the application 
                                of subsection (a)(2) of such section 
                                the MA-PD plan shall establish 
                                procedures to provide for payment of 
                                any additional out-of-pocket cost-
                                sharing described in subsection (a)(1) 
                                of such section incurred by individuals 
                                enrolled under the MA-PD plan; and
                                    ``(II) as applied under subclause 
                                (I), may not be waived by application 
                                of this subparagraph.
                        In applying subsection (b) of section 1860E-21 
                        pursuant to the previous sentence, an MA-PD 
                        plan may substitute a dollar amount that is 
                        less than the dollar amount specified under 
                        such subsection.''.
            (2) Exempting ma-pd plans offering alternative prescription 
        drug coverage from part d deductible and out-of-pocket limit 
        requirements.--Section 1860D-2(c) of the Social Security Act 
        (42 U.S.C. 1395w-102(c)) is amended--
                    (A) in paragraph (2), by striking ``The 
                deductible'' and inserting ``In the case of a 
                prescription drug plan, the deductible''; and
                    (B) in paragraph (3), by striking ``The coverage 
                provides'' and inserting ``In the case of a 
                prescription drug plan, the coverage provides''.
    (c) Prescription Drug Plans Required To Report Enrollees' Out-of-
Pocket Cost-Sharing.--Section 1860D-12(b) of the Social Security Act 
(42 U.S.C. 1395w-112(b)) is amended by adding at the end the following 
new paragraph:
            ``(7) Out-of-pocket cost-sharing reports.--Each contract 
        entered into with a PDP sponsor under this part with respect to 
        a prescription drug plan offered by such sponsor shall require 
        that, with respect to each claim submitted for items or 
        services furnished to an individual enrolled under the plan 
        pursuant to the contract, the sponsor submits to the Secretary 
        information on the amount of out-of-pocket cost-sharing (as 
        defined in section 1860E-23(c)) applicable to such enrollee for 
        such items or services.''.
    (d) Conforming Amendments.--
            (1) Section 1813 of the Social Security Act (42 U.S.C. 
        1395e) is amended--
                    (A) in subsection (a), by inserting ``Subject to 
                subpart 2 of part E:'' before paragraph (1); and
                    (B) in subsection (b), by inserting ``Subject to 
                subpart 2 of part E:'' before paragraph (1).
            (2) Section 1833 of such Act (42 U.S.C. 1395l) is amended--
                    (A) in subsection (a), in the matter preceding 
                paragraph (1), by inserting ``and subpart 2 of part E'' 
                after ``succeeding provisions of this section'';
                    (B) in subsection (b), in the first sentence, by 
                striking ``Before applying'' and inserting ``Subject to 
                subpart 2 of part E, before applying'';
                    (C) in subsection (c)(1), in the matter preceding 
                subparagraph (A), by inserting ``subject to subpart 2 
                of part E,'' after ``this part,'';
                    (D) in subsection (f), by striking ``In 
                establishing'' and inserting ``Subject to subpart 2 of 
                part E, in establishing''; and
                    (E) in subsection (g)(1), by inserting ``and 
                subpart 2 of part E'' and ``paragraphs (4) and (5)''.
            (3) Section 1882(a)(2) of such Act is amended by striking 
        ``No medicare'' and inserting ``Subject to section 1860E-24(c), 
        no medicare''.

SEC. 424. LATE ENROLLMENT PENALTY NOT TO APPLY FOR MONTHS OF ANY HEALTH 
              COVERAGE.

    (a) In General.--Section 1839(b) of the Social Security Act (42 
U.S.C. 1395r) is amended in the second sentence, by inserting before 
the period at the end the following: ``or months during which the 
individual has any other health coverage''.
    (b) Effective Date.--The amendment made by paragraph (1) shall 
apply for months of coverage beginning after the date of the enactment 
of this Act.

SEC. 425. MEDIGAP REFORM.

    Notwithstanding any provision of section 1882 of the Social 
Security Act (42 U.S.C. 1395ss), as of the date of the enactment of 
this Act, no policy may be offered under such section that does not 
provide guaranteed coverage (without regard to an individual's 
preexisting conditions, if any) to all individuals eligible to enroll 
under such policy.

SEC. 426. ACO REVISION.

    (a) Enrollment.--Enrollment in such an ACO under such title shall 
be based on the method established under part E of such title. Such a 
network shall bear full risk in the event payments under such title do 
not equal or exceed liabilities under such network.
    (b) Direction of Payment.--An ACO may direct that any payments 
under such title be made to a centralized entity rather than to an 
individual provider or supplier.
    (c) Bids.--The Secretary of Health and Human Services shall 
establish a process whereby such networks compete using a bidding 
process similar to that described in part E of such title for Medicare 
Advantage plans.

SEC. 427. PRIMARY CARE OPTIONS.

    (a) Selection of Primary Care Physician.--The Secretary shall 
establish a mechanism under which an individual enrolled under part B 
of title XVIII of the Social Security Act may select such individual's 
primary care physician. Such an individual shall not be liable for more 
than $5 for each visit to such selected physician.
    (b) Payment to Physician.--A physician selected under subsection 
(a) shall receive a monthly fee in lieu of any other payment under such 
part B for evaluation and monitoring of such individual. The Secretary 
shall provide a list of standardized benefits that are included in such 
payment, including telephone and email communications, office visits, 
preventive care, and vaccinations.

SEC. 428. GENERAL PROVISIONS; EFFECTIVE DATE.

    Part E of title XVIII of the Social Security Act, as inserted by 
section 101(a)(2) and as previously amended, is further amended by 
adding at the end the following new subpart:

                    ``Subpart 5.--General Provisions

``SEC. 1860E-51. APPLICABILITY; DEFINITIONS.

    ``(a) In General.--The provisions of this Act are superseded to the 
extent inconsistent with the provisions of this part.
    ``(b) Terminology.--For purposes of this part:
            ``(1) Medicare enrollee.--
                    ``(A) In general.--The term `Medicare enrollee' 
                means--
                            ``(i) an individual entitled to (or 
                        enrolled for benefits) under part A and 
                        enrolled under part B; and
                            ``(ii) except as otherwise specified, an 
                        individual described in section 1860E-11(a)(3).
                    ``(B) Treatment.--Any reference in this Act (or any 
                other Act) in effect before the date of the enactment 
                of this part, to an individual entitled to benefits 
                under part A or enrolled under part B shall be deemed a 
                reference to a Medicare enrollee.
            ``(2) Medicare fee-for-service.--The term `Medicare fee-
        for-service' means the original Medicare fee-for-service 
        program under parts A and B, as modified by this part, and does 
        not include part C or part D.
            ``(3) Medicare fee-for-service enrollee.--The term 
        `Medicare fee-for-service enrollee' means a Medicare enrollee 
        who is not enrolled under a Medicare Advantage plan under part 
        C.

``SEC. 1860E-61. GENERAL EFFECTIVE DATE.

    ``Except as otherwise specified, the provisions of this part shall 
apply to items and services furnished on or after January 1, 2023, and 
to plan years beginning on or after such date (referred to in this 
title as the `general effective date').''.

           Subtitle D--Telehealth Improvements and Expansion

SEC. 431. EXPANSION OF COVERAGE OF TELEHEALTH SERVICES.

    (a) Covered Services.--Section 1834(m)(4)(F)(i) of the Social 
Security Act (42 U.S.C. 1395m(m)(4)(F)(i)) is amended--
            (1) by striking ``and office'' and inserting ``office''; 
        and
            (2) by inserting: ``respiratory services, audiology 
        services (as defined in section 1861(ll)), outpatient therapy 
        services (including physical therapy, occupational therapy, and 
        speech-language pathology services)'' after ``the 
        Secretary)),''.
    (b) Providers.--Subsection (m) of section 1834 of such Act (42 
U.S.C. 1395m) is amended--
            (1) in paragraph (1), by striking ``or a practitioner 
        (described in section 1842(b)(18)(C))'' and inserting ``, a 
        practitioner (described in section 1842(b)(18)(C)), or an 
        applicable professional (as defined in paragraph (4)(G))'';
            (2) by striking ``physician or practitioner'' each time it 
        appears in such subsection and inserting ``physician, 
        practitioner, or applicable professional'';
            (3) in paragraph (3)(A)--
                    (A) in the heading, by striking ``Physician and 
                practitioner'' and inserting ``Physician, practitioner, 
                and applicable professional''; and
                    (B) by striking ``physicians or practitioners'' and 
                inserting ``physicians, practitioners, or applicable 
                professionals''; and
            (4) in paragraph (4), by adding at the end the following 
        new subparagraph:
                    ``(G) Applicable professional.--The term 
                `applicable professional' means, with respect to 
                services furnished on or after the date that is 6 
                months after the date of the enactment of this 
                subparagraph, a certified diabetes educator or 
                licensed--
                            ``(i) respiratory therapist;
                            ``(ii) audiologist;
                            ``(iii) occupational therapist;
                            ``(iv) physical therapist; or
                            ``(v) speech language pathologist.''.
    (c) Home-Based Monitoring Services for Congestive Heart Failure and 
Chronic Obstructive Pulmonary Disease.--
            (1) Coverage of remote patient monitoring services for 
        certain chronic health conditions.--Section 1861(s)(2) of the 
        Social Security Act (42 U.S.C. 1395x(s)(2)) is amended--
                    (A) in subparagraph (GG), by striking ``and'' at 
                the end;
                    (B) in subparagraph (HH), by inserting ``and'' at 
                the end; and
                    (C) by inserting after subparagraph (HH) the 
                following new subparagraph:
                    ``(II) applicable remote patient monitoring 
                services (as defined in paragraph (1)(A) of subsection 
                (iii));''.
            (2) Services described.--Section 1861 of the Social 
        Security Act (42 U.S.C. 1395x) is amended by adding at the end 
        the following new subsection:
    ``(kkk) Remote Patient Monitoring Services for Chronic Health 
Conditions.--
            ``(1)(A) The term `applicable remote patient monitoring 
        services' means remote patient monitoring services (as defined 
        in subparagraph (B)) furnished to provide for the monitoring, 
        evaluation, and management of an individual with a covered 
        chronic condition (as defined in paragraph (2)), insofar as 
        such services are for the management of such chronic condition.
            ``(B) The term `remote patient monitoring services' means 
        services furnished through remote patient monitoring technology 
        (as defined in subparagraph (C)).
            ``(C) The term `remote patient monitoring technology' means 
        a coordinated system that uses one or more home-based or mobile 
        monitoring devices that automatically transmit vital sign data 
        or information on activities of daily living and may include 
        responses to assessment questions collected on the devices 
        wirelessly or through a telecommunications connection to a 
        server that complies with the Federal regulations (concerning 
        the privacy of individually identifiable health information) 
        promulgated under section 264(c) of the Health Insurance 
        Portability and Accountability Act of 1996, as part of an 
        established plan of care for that patient that includes the 
        review and interpretation of that data by a health care 
        professional.
            ``(2) For purposes of paragraph (1), the term `covered 
        chronic health condition' means applicable conditions (as 
        defined in and applied under section 1886(q)(5)) when under 
        chronic care management (identified as of July 1, 2015, by 
        HCPCS code 99490 (and as subsequently modified by the 
        Secretary)).
            ``(3)(A) Payment may be made under this part for applicable 
        remote patient monitoring services provided to an individual 
        during a period of up to 90 days and such additional period as 
        provided for under subparagraph (B).
            ``(B) The 90-day period described in subparagraph (A), with 
        respect to an individual, may be renewed by the physician who 
        provides chronic care management to such individual if the 
        individual continues to qualify for such management.''.
            (3) Payment under the physician fee schedule.--Section 1848 
        of the Social Security Act (42 U.S.C. 1395w-4) is amended--
                    (A) in subsection (c)--
                            (i) in paragraph (2)(B)--
                                    (I) in clause (ii)(II), by striking 
                                ``and (v)'' and inserting ``(v), and 
                                (vii)''; and
                                    (II) by adding at the end the 
                                following new clause:
                            ``(vii) Budgetary treatment of certain 
                        services.--The additional expenditures 
                        attributable to services described in section 
                        1861(s)(2)(II) shall not be taken into account 
                        in applying clause (ii)(II).''; and
                            (ii) by adding at the end the following new 
                        paragraph:
            ``(7) Treatment of applicable remote patient monitoring 
        services.--
                    ``(A) In determining relative value units for 
                applicable remote patient monitoring services (as 
                defined in section 1861(iii)(1)(A)), the Secretary, in 
                consultation with appropriate physician groups, 
                practitioner groups, and supplier groups, shall take 
                into consideration--
                            ``(i) physician or practitioner resources, 
                        including physician or practitioner time and 
                        the level of intensity of services provided, 
                        based on--
                                    ``(I) the frequency of evaluation 
                                necessary to manage the individual 
                                being furnished the services;
                                    ``(II) the complexity of the 
                                evaluation, including the information 
                                that must be obtained, reviewed, and 
                                analyzed; and
                                    ``(III) the number of possible 
                                diagnoses and the number of management 
                                options that must be considered;
                            ``(ii) practice expense costs associated 
                        with such services, including the direct costs 
                        associated with installation and information 
                        transmission, costs of remote patient 
                        monitoring technology (including equipment and 
                        software), device delivery costs, and resource 
                        costs necessary for patient monitoring and 
                        followup (but not including costs of any 
                        related item or non-physician service otherwise 
                        reimbursed under this title); and
                            ``(iii) malpractice expense resources.
                    ``(B) Using the relative value units determined in 
                subparagraph (A), the Secretary shall provide for 
                separate payment for such services and shall not adjust 
                the relative value units assigned to other services 
                that might otherwise have been determined to include 
                such separately paid remote patient monitoring 
                services.''; and
                    (B) in subsection (j)(3), by inserting ``(2)(II),'' 
                after ``health risk assessment),''.

SEC. 432. EXPANDING THE USE OF TELEHEALTH THROUGH THE WAIVER OF CERTAIN 
              REQUIREMENTS.

    (a) In General.--Section 1834(m) of the Social Security Act (42 
U.S.C. 1395m(m)) is amended--
            (1) in paragraph (4)(C)(i), by striking ``and (7)'' and 
        inserting ``(7), and (8)''; and
            (2) by adding at the end the following:
            ``(8) Authority to waive requirements and limitations if 
        certain conditions met.--
                    ``(A) In general.--Notwithstanding the preceding 
                provisions of this subsection, in the case of 
                telehealth services furnished on or after January 1, 
                2023, the Secretary may waive any restriction 
                applicable to payment for telehealth services under 
                this subsection that is described in subparagraph (B), 
                but only if the Secretary determines that such waiver 
                would not deny or limit the coverage or provision of 
                benefits under this title, and--
                            ``(i) the Secretary determines that the 
                        waiver is expected to reduce spending under 
                        this title without reducing the quality of care 
                        or improve the quality of patient care without 
                        increasing spending; or
                            ``(ii) the waiver would apply to telehealth 
                        services furnished in originating sites located 
                        in a high-need health professional shortage 
                        area (as designated pursuant to section 
                        332(a)(1)(A) of the Public Health Service Act 
                        (42 U.S.C. 254e(a)(1)(A))).
                    ``(B) Restrictions described.--For purposes of this 
                paragraph, restrictions applicable to payment for 
                telehealth services under paragraph (1) are--
                            ``(i) requirements relating to 
                        qualifications for an originating site under 
                        paragraph (4)(C)(ii);
                            ``(ii) any geographic limitations under 
                        paragraph (4)(C)(i) (other than applicable 
                        State law requirements, including State 
                        licensure requirements);
                            ``(iii) any limitation on the type of 
                        technology used to furnish telehealth services;
                            ``(iv) any limitation on the type of 
                        provider of services or supplier who may 
                        furnish telehealth services (other than the 
                        requirement that the provider of services or 
                        supplier is enrolled under this title);
                            ``(v) any limitation on specific services 
                        designated as telehealth services pursuant to 
                        this subsection (provided the Secretary 
                        determines that such services are clinically 
                        appropriate to furnish remotely); or
                            ``(vi) any other limitation relating to the 
                        furnishing of telehealth services under this 
                        title identified by the Secretary.
                    ``(C) Public comment.--The Secretary shall 
                establish a process by which stakeholders may (on at 
                least an annual basis) provide public comment for 
                waivers under this paragraph.
                    ``(D) Periodic review of waivers.--The Secretary 
                shall periodically, but not more often than every 3 
                years, reassess each waiver under this paragraph to 
                determine whether the waiver continues to meet the 
                conditions applicable under subparagraph (A).''.
    (b) Posting of Information.--Not later than 2 years after the date 
on which a waiver under section 1834(m)(8) of the Social Security Act, 
as added by subsection (a), first becomes effective, and at least 
biennially thereafter, the Secretary of Health and Human Services shall 
post on the internet website of the Centers for Medicare & Medicaid 
Services--
            (1) the number of Medicare beneficiaries receiving 
        telehealth services by reason of each waiver under such 
        section;
            (2) the impact of such waivers on expenditures and 
        utilization under title XVIII of the Social Security Act (42 
        U.S.C. 1395 et seq.); and
            (3) other outcomes, as determined appropriate by the 
        Secretary.

SEC. 433. EXPANDING THE USE OF TELEHEALTH FOR MENTAL HEALTH SERVICES.

    (a) In General.--Section 1834(m) of the Social Security Act (42 
U.S.C. 1395m(m)), as amended by the preceding sections, is amended--
            (1) in paragraph (4)(C)(i), by striking ``and (8)'' and 
        inserting ``(8), and (9)''; and
            (2) by adding at the end the following:
            ``(9) Treatment of mental health services furnished through 
        telehealth.--The geographic requirements described in paragraph 
        (4)(C)(i) (other than applicable State law requirements, 
        including State licensure requirements) shall not apply with 
        respect to telehealth services that are mental health services 
        (as determined by the Secretary) furnished on or after January 
        1, 2023, to an eligible telehealth individual at an originating 
        site described in paragraph (4)(C)(ii) (other than an 
        originating site described in subclause (IX) of such 
        paragraph).''.
    (b) Inclusion of the Home as an Originating Site.--Section 
1834(m)(4)(C)(ii)(X) of such Act (42 U.S.C. 1395m(m)(4)(C)(ii)(X)) is 
amended by striking ``paragraph (7)'' and inserting ``paragraphs (7) 
and (9)''.
    (c) Additional Services.--As part of the implementation of the 
amendments made by this section, the Secretary of Health and Human 
Services shall consider whether additional services should be added to 
the services specified in paragraph (4)(F)(i) of section 1834(m) of 
such Act (42 U.S.C. 1395m) for authorized payment under paragraph (1) 
of such section.

SEC. 434. USE OF TELEHEALTH IN EMERGENCY MEDICAL CARE.

    (a) In General.--Section 1834(m) of the Social Security Act (42 
U.S.C. 1395m(m)), as amended by the preceding sections, is amended--
            (1) in paragraph (4)(C)(i), by striking ``and (9)'' and 
        inserting ``(9), and (10)''; and
            (2) by adding at the end the following:
            ``(10) Treatment of emergency medical care furnished 
        through telehealth.--The geographic requirements described in 
        paragraph (4)(C)(i) (other than applicable State law 
        requirements, including State licensure requirements) shall not 
        apply with respect to telehealth services that are services for 
        emergency medical care (as determined by the Secretary) 
        furnished on or after January 1, 2023, to an eligible 
        telehealth individual at an originating site described in 
        subclause (II), (V), or (VII) of paragraph (4)(C)(ii).''.
    (b) Additional Services.--As part of the implementation of the 
amendments made by this section, the Secretary of Health and Human 
Services shall consider whether additional services should be added to 
the services specified in paragraph (4)(F)(i) of section 1834(m) of 
such Act (42 U.S.C. 1395m) for authorized payment under paragraph (1) 
of such section.

SEC. 435. IMPROVEMENTS TO THE PROCESS FOR ADDING TELEHEALTH SERVICES.

    The Secretary shall undertake a review of the process established 
pursuant to section 1834(m)(4)(F)(ii) of the Social Security Act (42 
U.S.C. 1395m(m)(4)(F)(ii)), and based on the results of such review--
            (1) implement revisions to the process so that the criteria 
        to add services prioritizes, as appropriate, improved access to 
        care through telehealth services; and
            (2) provide clarification on what requests to add 
        telehealth services under such process should include.

SEC. 436. RURAL HEALTH CLINICS AND FEDERALLY QUALIFIED HEALTH CENTERS.

    (a) Expansion of Originating Sites.--Section 1834(m)(4)(C) of the 
Social Security Act (42 U.S.C. 1395m(m)(4)(C)), as amended by the 
preceding sections, is amended--
            (1) in clause (i), by striking ``and (10)'' and inserting 
        ``and (10), and subject to clause (iii),''; and
            (2) by adding at the end the following new clause:
                            ``(iii) Rural health clinics and federally 
                        qualified health centers.--The term 
                        `originating site' shall also include any 
                        Federally qualified health center and any rural 
                        health clinic (as such terms are defined in 
                        section 1861(aa)) at which the eligible 
                        telehealth individual is located at the time 
                        the service is furnished via a 
                        telecommunications system, whether or not the 
                        individual is located in an area described in 
                        clause (i), insofar as such sites are not 
                        otherwise included in the definition of 
                        originating site under such clause, subject to 
                        applicable State law requirements, including 
                        State licensure requirements.''.
    (b) Expansion of Distant Sites.--Section 1834(m) of the Social 
Security Act (42 U.S.C. 1395m(m)) is amended--
            (1) in the first sentence of paragraph (1)--
                    (A) by striking ``or a practitioner (described in 
                section 1842(b)(18)(C))'' and inserting ``, a 
                practitioner (described in section 1842(b)(18)(C)), a 
                Federally qualified health center, or a rural health 
                clinic''; and
                    (B) by striking ``or practitioner'' and inserting 
                ``, practitioner, Federally qualified health center, or 
                rural health clinic'';
            (2) in paragraph (2)(A)--
                    (A) by inserting ``or to a Federally qualified 
                health center or rural health clinic that serves as a 
                distant site'' after ``a distant site''; and
                    (B) by striking ``such physician or practitioner'' 
                and inserting ``such physician, practitioner, Federally 
                qualified health center, or rural health clinic''; and
            (3) in paragraph (4)--
                    (A) in subparagraph (A), by inserting ``and 
                includes a Federally qualified health center or rural 
                health clinic that furnishes a telehealth service to an 
                eligible individual'' before the period at the end; and
                    (B) in subparagraph (F), by adding at the end the 
                following new clause:
                            ``(iii) Inclusion of rural health clinic 
                        services and federally qualified health center 
                        services furnished using telehealth.--For 
                        purposes of this subparagraph, the term 
                        `telehealth services' includes a rural health 
                        clinic service or Federally qualified health 
                        center service that is furnished using 
                        telehealth to the extent that payment codes 
                        corresponding to services identified by the 
                        Secretary under clause (i) or (ii) are listed 
                        on the corresponding claim for such rural 
                        health clinic service or Federally qualified 
                        health center service.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to services furnished on or after January 1, 2023.

SEC. 437. NATIVE AMERICAN HEALTH FACILITIES.

    (a) In General.--Section 1834(m)(4)(C) of the Social Security Act 
(42 U.S.C. 1395m(m)(4)(C)), as amended by the preceding sections, is 
amended--
            (1) in clause (i), by striking ``clause (iii)'' and 
        inserting ``clauses (iii) and (iv)''; and
            (2) by adding at the end the following new clause:
                            ``(iv) Native american health facilities.--
                        The originating site requirements described in 
                        clauses (i) and (ii) shall not apply with 
                        respect to a facility of the Indian Health 
                        Service, whether operated by such Service, or 
                        by an Indian tribe (as that term is defined in 
                        section 4 of the Indian Health Care Improvement 
                        Act (25 U.S.C. 1603)) or a tribal organization 
                        (as that term is defined in section 4 of the 
                        Indian Self-Determination and Education 
                        Assistance Act (25 U.S.C. 5304)), or a facility 
                        of the Native Hawaiian health care systems 
                        authorized under the Native Hawaiian Health 
                        Care Improvement Act (42 U.S.C. 11701 et 
                        seq.).''.
    (b) No Originating Site Facility Fee for New Sites.--Section 
1834(m)(2)(B)(i) of the Social Security Act (42 U.S.C. 
1395m(m)(2)(B)(i)) is amended, in the matter preceding subclause (I), 
by inserting ``(other than an originating site that is only described 
in clause (iv) of paragraph (4)(C), and does not meet the requirement 
for an originating site under clause (i) of such paragraph)'' after 
``the originating site''.
    (c) Effective Date.--The amendments made by this section shall 
apply to services furnished on or after January 1, 2023.

SEC. 438. WAIVER OF TELEHEALTH RESTRICTIONS DURING NATIONAL 
              EMERGENCIES.

    Section 1135(b) of the Social Security Act (42 U.S.C. 1320b-5(b)) 
is amended--
            (1) in paragraph (6), by striking ``and'' after the 
        semicolon;
            (2) in paragraph (7), by striking the period at the end and 
        inserting ``; and''; and
            (3) by adding at the end the following:
            ``(8) requirements for payment for telehealth services 
        under section 1834(m).''.

SEC. 439. USE OF TELEHEALTH IN RECERTIFICATION FOR HOSPICE CARE.

    (a) In General.--Section 1814(a)(7)(D)(i) of the Social Security 
Act (42 U.S.C. 1395f(a)(7)(D)(i)) is amended by inserting ``(including 
through use of telehealth, notwithstanding the requirements in section 
1834(m)(4)(C))'' after ``face-to-face encounter''.
    (b) GAO Report.--Not later than 3 years after the date of enactment 
of this Act, the Comptroller General of the United States shall submit 
a report to Congress evaluating the impact of the amendment made by 
subsection (a) on--
            (1) the number and percentage of beneficiaries recertified 
        for the Medicare hospice benefit at 180 days and for subsequent 
        benefit periods;
            (2) the appropriateness for hospice care of the patients 
        recertified through the use of telehealth; and
            (3) any other factors determined appropriate by the 
        Comptroller General.

SEC. 440. CLARIFICATION FOR FRAUD AND ABUSE LAWS REGARDING TECHNOLOGIES 
              PROVIDED TO BENEFICIARIES.

    Section 1128A(i)(6) of the Social Security Act (42 U.S.C. 1320a-
7a(i)(6)) is amended--
            (1) in subparagraph (I), by striking ``; or'' and inserting 
        a semicolon;
            (2) in subparagraph (J), by striking the period at the end 
        and inserting ``; or''; and
            (3) by adding at the end the following new subparagraph:
                    ``(K) the provision of technologies (as defined by 
                the Secretary) on or after the date of the enactment of 
                this subparagraph, by a provider of services or 
                supplier (as such terms are defined for purposes of 
                title XVIII) directly to an individual who is entitled 
                to benefits under part A of title XVIII, enrolled under 
                part B of such title, or both, for the purpose of 
                furnishing telehealth services, remote patient 
                monitoring services, or other services furnished 
                through the use of technology (as defined by the 
                Secretary), if--
                            ``(i) the technologies are not offered as 
                        part of any advertisement or solicitation; and
                            ``(ii) the provision of the technologies 
                        meets any other requirements set forth in 
                        regulations promulgated by the Secretary.''.

SEC. 441. STUDY AND REPORT ON INCREASING ACCESS TO TELEHEALTH SERVICES 
              IN THE HOME.

    (a) MedPAC Study.--The Medicare Payment Advisory Commission (in 
this section referred to as the ``Commission'') shall conduct a study 
on increasing access under the Medicare program under title XVIII of 
the Social Security Act (42 U.S.C. 1395 et seq.) to telehealth services 
in the home. Such study shall include an analysis of the following:
            (1) How different payers allow the home to be an 
        originating site for telehealth services.
            (2) Particular types of telehealth services or subgroups of 
        beneficiaries with respect to which allowing the home to be an 
        originating site under the Medicare program would be suitable.
    (b) Report.--Not later than 24 months after the date of the 
enactment of this Act, the Commission shall submit to Congress a report 
containing the results of the study conducted under subsection (a), 
together with recommendations for such legislation and administrative 
action as the Commission determines appropriate.

SEC. 442. ANALYSIS OF TELEHEALTH WAIVERS IN ALTERNATIVE PAYMENT MODELS.

    The second sentence of section 1115A(g) of the Social Security Act 
(42 U.S.C. 1315a(g)) is amended by inserting ``an analysis of waivers 
under section (d)(1) related to telehealth and the impact on quality 
and spending under the applicable titles of such waivers,'' after 
``subsection (c),''.

SEC. 443. MODEL TO ALLOW ADDITIONAL HEALTH PROFESSIONALS TO FURNISH 
              TELEHEALTH SERVICES.

    Section 1115A(b)(2)(B) of the Social Security Act (42 U.S.C. 
1315a(b)(2)(B)) is amended by adding at the end the following new 
clause:
                            ``(xxviii) Allowing health professionals 
                        who are not otherwise eligible under section 
                        1834(m) to furnish telehealth services to 
                        furnish such services.''.

SEC. 444. TESTING OF MODELS TO EXAMINE THE USE OF TELEHEALTH UNDER THE 
              MEDICARE PROGRAM.

    Section 1115A(b)(2) of the Social Security Act (42 U.S.C. 
1315a(b)(2)) is amended by adding at the end the following new 
subparagraph:
                    ``(D) Testing models to examine use of telehealth 
                under medicare.--The Secretary shall consider testing 
                under this subsection models to examine the use of 
                telehealth under title XVIII.''.
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