Title: Reducing Costs for Out-of-Network Services Act of 2019
Policy area: Health

Summary:
Reducing Costs for Out-of-Network Services Act of 2019  This bill places limits on the cost to insurance plan holders for out-of-network health care services and on the amount charged for services provided to uninsured individuals. First, each state must select one of the following formulas for determining the maximum cost for a service:
Health insurance issuers must set the cost-sharing amount for out-of-network services at no more than the state-selected rate for such service. Further, out-of-network health care providers may charge plan holders no more than the state-selected rate for a service.  Each state also must set the maximum rate for services that health care providers may charge uninsured individuals at the lower of (1) 125% of the fee-for-service rate under Medicare, (2) the 80th percentile of the cost for such service in the geographic area, or (3) the rate otherwise applicable under state law.
If a state does not select a maximum rate for a service provided to an insured or uninsured individual, the maximum rate a provider may charge is (1) 125% of the fee-for-service rate under Medicare, or (2) the rate established by the Department of Health and Human Services if such service is not covered under Medicare.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 967 Introduced in Senate (IS)]

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116th CONGRESS
  1st Session
                                 S. 967

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


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 1, 2019

Mrs. Shaheen (for herself, Ms. Baldwin, and Mr. Merkley) 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 in the individual market, 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 2019''.

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

    (a) In General.--Subpart 2 of part B of title XXVII of the Public 
Health Service Act (42 U.S.C. 300gg-51 et seq.) is amended by adding at 
the end the following:

``SEC. 2754. LIMITATIONS ON COST-SHARING FOR OUT-OF-NETWORK SERVICES.

    ``(a) Health Insurance Issuer Requirement.--A health insurance 
issuer offering health insurance coverage, in the individual market in 
a State, that offers benefits with respect to a health care service 
provided in the 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 a health care service at a rate in excess of the 
        following:
                    ``(A) In the case of a patient who is enrolled in 
                health insurance coverage in the individual market that 
                does not provide out-of-network benefits for such 
                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 health 
                insurance coverage in the individual market that 
                provides out-of-network benefits for such 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 by the 
                                health insurance issuer 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 an applicable law in the State.
            ``(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 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 a health care service for individuals enrolled in 
        health insurance coverage in the individual market in the 
        State:
                    ``(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) The 80th percentile of usual, customary, and 
                reasonable charge rates for the service for the 
                geographic area, as determined by a database of usual, 
                customary, and reasonable charges selected 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 
                average actual allowed rate under the coverage for all 
                participating providers for such service in the health 
                insurance issuer's participating provider network.
            ``(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 
        a health care service 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.

``SEC. 2755. REPORTS TO CONGRESS ON NETWORK ADEQUACY.

    ``Not later than January 1, 2022, and every year thereafter, the 
Secretary shall prepare and submit to the Committee on Health, 
Education, Labor, and Pensions of the Senate and the Committee on 
Energy and Commerce of the House of Representatives a report on--
            ``(1) how State network adequacy laws, section 2702(c), and 
        any other network adequacy requirements for qualified health 
        plans under the Patient Protection and Affordable Care Act 
        ensure that provider networks are broad enough to meet the 
        needs of enrolled patients;
            ``(2) the impact of section 2754 on network adequacy; and
            ``(3) any recommendations for Congress, as necessary, on 
        how to improve network adequacy.''.
    (b) Effective Date.--Section 2754 of the Public Health Service Act, 
as added by subsection (a), shall take effect on January 1, 2021.

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 that are similar to the limitations that apply under section 
2754 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'' 
and ``group health insurance coverage'' 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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