Title: Reducing Costs for Out-of-Network Services Act of 2018
Policy area: Health

Summary:
Reducing Costs for Out-of-Network Services Act of 2018
This bill prohibits health insurers and providers from charging individuals who have health insurance above a certain rate for out-of-network services; providers may also not charge uninsured individuals above a certain rate. States must select the applicable rates from specified options.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[S. 3541 Introduced in Senate (IS)]

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115th CONGRESS
  2d Session
                                S. 3541

  To amend the Public Health Service Act to establish limitations on 
 cost-sharing for out-of-network services, to prohibit balance billing 
               for such services, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

            October 3 (legislative day, September 28), 2018

Mrs. Shaheen (for herself, Mrs. McCaskill, Ms. Baldwin, and Ms. Hassan) 
introduced the following bill; which was read twice and referred to the 
          Committee on Health, Education, Labor, and Pensions

_______________________________________________________________________

                                 A BILL


 
  To amend the Public Health Service Act to establish limitations on 
 cost-sharing for out-of-network services, to prohibit balance billing 
               for such services, 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.

    This Act may be cited as the ``Reducing Costs for Out-of-Network 
Services Act of 2018''.

SEC. 2. LIMITATIONS ON COST-SHARING FOR OUT-OF-NETWORK SERVICES.

    (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. 2729. LIMITATIONS ON COST-SHARING FOR OUT-OF-NETWORK SERVICES.

    ``(a) Health Insurance Issuer Requirement.--A health insurance 
issuer offering individual health insurance coverage that offers 
benefits with respect to a health care service provided in a State by a 
participating provider shall ensure that the cost-sharing requirement 
with respect to such service provided in the State by a 
nonparticipating provider does not exceed the rate selected by the 
applicable State authority under subsection (c)(1) for such service.
    ``(b) Limitation on Charges by Health Care Providers.--
            ``(1) In general.--A health care provider may not charge a 
        patient for health care services in excess of the following:
                    ``(A) In the case of a patient who is enrolled in 
                individual health insurance coverage that does not 
                provide out-of-network benefits for a given service, 
                the health care provider may charge such patient no 
                more than the rate selected by the applicable State 
                authority under subsection (c)(1).
                    ``(B) In the case of a patient enrolled in 
                individual health insurance coverage that provides out-
                of-network benefits for a given service, the health 
                care provider may charge such patient no more than--
                            ``(i) the rate selected by the applicable 
                        State authority under subsection (c)(1); minus
                            ``(ii) the sum of--
                                    ``(I) the payment made to the 
                                health care provider pursuant to such 
                                coverage; and
                                    ``(II) the out-of-network cost-
                                sharing amount required under such 
                                coverage.
                    ``(C) In the case of an uninsured individual, the 
                health care provider may charge such patient no more 
                than the lower of--
                            ``(i) the rate selected by the applicable 
                        State authority under subsection (c)(2); or
                            ``(ii) the rate otherwise allowed to be 
                        charged to such an individual for such a 
                        service under State law.
            ``(2) Enforcement.--A health care provider that violates 
        the requirement under paragraph (1) shall be subject to the 
        same civil monetary penalties described in paragraph (1) of 
        section 922(f), including the provisions described in paragraph 
        (2) of such section, as a person who commits a violation 
        described in paragraph (1) of such section.
    ``(c) Rate.--
            ``(1) Individuals enrolled in individual health insurance 
        coverage.--An applicable State authority shall select for the 
        State as applicable for purposes of subsection (a) and 
        subparagraphs (A) and (B) of subsection (b)(1) one of the 
        following as a maximum rate for health care services for 
        individuals enrolled in individual health insurance coverage:
                    ``(A) 125 percent (or, in a case described in 
                paragraph (3) and at the discretion of the applicable 
                State authority, 200 percent) of the allowed charges 
                determined for the item or service under the original 
                Medicare fee-for-service program under parts A and B of 
                title XVIII of the Social Security Act.
                    ``(B) 80 percent of the usual, customary, and 
                reasonable charge for the service, as determined by a 
                database of usual, customary, and reasonable charges 
                chosen by the applicable State authority and approved 
                as appropriate by the Secretary.
                    ``(C) 100 percent of the allowed charges for the 
                service if the service were provided by a participating 
                provider, which shall be determined based upon the 
                actual allowed rate under the coverage.
            ``(2) Uninsured individuals.--An applicable State authority 
        shall select for the State as applicable for purposes of 
        subsection (b)(1)(C) one of the following as a maximum rate for 
        health care services for uninsured individuals:
                    ``(A) The rate described in subparagraph (A) of 
                paragraph (1).
                    ``(B) The rate described in subparagraph (B) of 
                paragraph (1).
            ``(3) Services provided in rural areas.--A case described 
        in this paragraph is a case in which the item or service is 
        furnished by a provider of services (as defined in subsection 
        (u) of section 1861 of the Social Security Act) or supplier (as 
        defined in subsection (d) of such section) in a rural area (as 
        defined in section 1886(d)(2)(D) of such Act).
            ``(4) Default rate.--In the case in which an applicable 
        State authority does not select a rate under paragraph (1) or 
        (2) for a service, the maximum rate applicable in the State for 
        the service for purposes of subsections (a) and (b) shall--
                    ``(A) be the rate described in subparagraph (A) of 
                paragraph (1), if the service is covered under the 
                original Medicare fee-for-service program under parts A 
                and B of title XVIII of the Social Security Act; or
                    ``(B) be a rate established by the Secretary, if 
                the service is not covered under such program.
            ``(5) Clarification.--In selecting a rate under paragraph 
        (1) or (2) for a health care service, the applicable State may 
        select a rate that differs from the rate selected under such 
        paragraph for a different health care service.
    ``(d) Definitions.--For purposes of this section:
            ``(1) Health care provider.--The term `health care 
        provider' includes a hospital (as defined in section 1861(e) of 
        the Social Security Act), a critical access hospital (as 
        defined in section 1861(mm) of such Act), a physician (as 
        defined in section 1861(r) of such Act), and other providers as 
        determined by the Secretary.
            ``(2) Uninsured individual.--The term `uninsured 
        individual', with respect to an individual receiving a health 
        care service, means an individual who, at the time at which the 
        service was furnished, was not enrolled in a plan that provides 
        medical care benefits, including any Federal health benefit 
        program, as determined by the Secretary.''.
    (b) Effective Date.--Section 2729 of the Public Health Service Act, 
as added by subsection (a), shall take effect on January 1, 2020.

SEC. 3. GRANTS FOR GROUP MARKET.

    (a) In General.--The Secretary of Health and Human Services shall 
award grants to States for the purpose of studying the potential for 
imposing limitations on charges for health care services provided to 
individuals enrolled in group health plans or group health insurance 
coverage offered by a health insurance issuer that are similar to the 
limitations that apply under section 2729 of the Public Health Service 
Act, as added by section 2.
    (b) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as may be necessary to carry out this section.
    (c) Definitions.--In this section, the terms ``group health plan'', 
``group health insurance coverage'', and ``health insurance issuer'' 
have the meanings given such terms in section 2791 of the Public Health 
Service Act (42 U.S.C. 300gg-91).
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