House Health Care Bill (Pages 51-100)

P. 51

covered by this Act shall be provided without regard to
personal characteristics extraneous to the provision of
high quality health care or related services.
(b) IMPLEMENTATION.–To implement the require-
ment set forth in subsection (a), the Secretary of Health
and Human Services shall, not later than 18 months after
the date of the enactment of this Act, promulgate such
regulations as are necessary or appropriate to insure that
all health care and related services (including insurance
coverage and public health activities) covered by this Act
are provided (whether directly or through contractual, li-
censing, or other arrangements) without regard to per-
sonal characteristics extraneous to the provision of high
quality health care or related services.
SEC. 153. WHISTLE BLOWER PROTECTION.
(a) RETALIATION PROHIBITED.–No employer may
discharge any employee or otherwise discriminate against
any employee with respect to his compensation, terms,
conditions, or other privileges of employment because the
employee (or any person acting pursuant to a request of
the employee)–
(1) provided, caused to be provided, or is about
to provide or cause to be provided to the employer,
the Federal Government, or the attorney general of
a State information relating to any violation of, or

P. 52

any act or omission the employee reasonably believes 1
to be a violation of any provision of this Act or any
order, rule, or regulation promulgated under this
Act;
(2) testified or is about to testify in a pro-
ceeding concerning such violation;
(3) assisted or participated or is about to assist
or participate in such a proceeding; or
(4) objected to, or refused to participate in, any
activity, policy, practice, or assigned task that the
employee (or other such person) reasonably believed
to be in violation of any provision of this Act or any
order, rule, or regulation promulgated under this
Act.
(b) ENFORCEMENTACTION.–An employee covered
by this section who alleges discrimination by an employer
in violation of subsection (a) may bring an action governed
by the rules, procedures, legal burdens of proof, and rem-
edies set forth in section 40(b) of the Consumer Product
Safety Act (15 U.S.C. 2087(b)).
(c) EMPLOYERDEFINED.–As used in this section,
the term ”employer” means any person (including one or
more individuals, partnerships, associations, corporations,
trusts, professional membership organization including a
certification, disciplinary, or other professional body, unin-

P. 53

corporated organizations, nongovernmental organizations,
or trustees) engaged in profit or nonprofit business or in-
dustry whose activities are governed by this Act, and any
agent, contractor, subcontractor, grantee, or consultant of
such person. 5
(d) RULEOFCONSTRUCTION.–The rule of construc-
tion set forth in section 20109(h) of title 49, United
States Code, shall also apply to this section.
SEC. 154. CONSTRUCTION REGARDING COLLECTIVE BAR-
GAINING.
Nothing in this division shall be construed to alter
of supercede any statutory or other obligation to engage
in collective bargaining over the terms and conditions of
employment related to health care.
SEC. 155. SEVERABILITY.
If any provision of this Act, or any application of such
provision to any person or circumstance, is held to be un-
constitutional, the remainder of the provisions of this Act
and the application of the provision to any other person
or circumstance shall not be affected.
Subtitle G–Early Investments
SEC. 161. ENSURING VALUE AND LOWER PREMIUMS.
(a) GROUPHEALTHINSURANCECOVERAGE.–Title
XXVII of the Public Health Service Act is amended by
inserting after section 2713 the following new section:

P. 54

”SEC. 2714. ENSURING VALUE AND LOWER PREMIUMS.
”(a) IN GENERAL.–Each health insurance issuer
that offers health insurance coverage in the small or large
group market shall provide that for any plan year in which
the coverage has a medical loss ratio below a level specified
by the Secretary, the issuer shall provide in a manner
specified by the Secretary for rebates to enrollees of pay-
ment sufficient to meet such loss ratio. Such methodology
shall be set at the highest level medical loss ratio possible
that is designed to ensure adequate participation by
issuers, competition in the health insurance market, and
value for consumers so that their premiums are used for
services.
”(b) UNIFORMDEFINITIONS.–The Secretary shall
establish a uniform definition of medical loss ratio and
methodology for determining how to calculate the medical
loss ratio. Such methodology shall be designed to take into
account the special circumstances of smaller plans, dif-
ferent types of plans, and newer plans.”.
(b) INDIVIDUALHEALTHINSURANCECOVERAGE.–
Such title is further amended by inserting after section
2753 the following new section:
”SEC. 2754. ENSURING VALUE AND LOWER PREMIUMS.
”The provisions of section 2714 shall apply to health
insurance coverage offered in the individual market in the

P. 55

same manner as such provisions apply to health insurance
coverage offered in the small or large group market.”.
(c) IMMEDIATE IMPLEMENTATION.–The amend-
ments made by this section shall apply in the group and
individual market for plan years beginning on or after
January 1, 2011.
SEC. 162. ENDING HEALTH INSURANCE RESCISSION ABUSE.
(a) CLARIFICATION REGARDING APPLICATION OF
GUARANTEEDRENEWABILITY OF INDIVIDUAL HEALTH
INSURANCE COVERAGE.–Section 2742 of the Public
Health Service Act (42 U.S.C. 300gg-42) is amended–
(1) in its heading, by inserting ”ANDCON-
TINUATION IN FORCE, INCLUDING PROHIBI-
TIONOFRESCISSION,” after ”GUARANTEEDRE-
NEWABILITY”; and
(2) in subsection (a), by inserting ”, including
without rescission,” after ”continue in force”.
(b) SECRETARIAL GUIDANCE REGARDING RESCIS-
SIONS.–Section 2742 of such Act (42 U.S.C. 300gg-42)
is amended by adding at the end the following:
”(f) RESCISSION.–A health insurance issuer may re-
scind health insurance coverage only upon clear and con-
vincing evidence of fraud described in subsection (b)(2).
The Secretary, no later than July 1, 2010, shall issue

P. 56

guidance implementing this requirement, including proce-
dures for independent, external third party review.”.
(c) OPPORTUNITY FOR INDEPENDENT, EXTERNAL
THIRD PARTY REVIEW IN CERTAIN CASES.–Subpart 1
of part B of title XXVII of such Act (42 U.S.C. 300gg-
41 et seq.) is amended by adding at the end the following:
”SEC. 2746. OPPORTUNITY FOR INDEPENDENT, EXTERNAL
THIRD PARTY REVIEW IN CASES OF RESCIS-
SION.
”(a) NOTICE AND REVIEW RIGHT.–If a health in-
surance issuer determines to rescind health insurance cov-
erage for an individual in the individual market, before
such rescission may take effect the issuer shall provide the
individual with notice of such proposed rescission and an
opportunity for a review of such determination by an inde-
pendent, external third party under procedures specified
by the Secretary under section 2742(f).
”(b) INDEPENDENT DETERMINATION.–If the indi-
vidual requests such review by an independent, external
third party of a rescission of health insurance coverage,
the coverage shall remain in effect until such third party
determines that the coverage may be rescinded under the
guidance issued by the Secretary under section 2742(f).”.
(d) EFFECTIVE DATE.–The amendments made by
this section shall apply on and after October 1, 2010, with

P. 57

respect to health insurance coverage issued before, on, or
after such date.
SEC. 163. ADMINISTRATIVE SIMPLIFICATION.
(a) STANDARDIZING ELECTRONIC ADMINISTRATIVE
TRANSACTIONS.–
(1) IN GENERAL.–Part C of title XI of the So-
cial Security Act (42 U.S.C. 1320d et seq.) is
amended by inserting after section 1173 the fol-
lowing new section:
”SEC. 1173A. STANDARDIZE ELECTRONIC ADMINISTRATIVE
TRANSACTIONS.
”(a) STANDARDS FORFINANCIAL AND ADMINISTRA-
TIVE TRANSACTIONS.–
”(1) IN GENERAL.–The Secretary shall adopt
and regularly update standards consistent with the
goals described in paragraph (2).
”(2) GOALS FOR FINANCIAL AND ADMINISTRA-
TIVE TRANSACTIONS.–The goals for standards
under paragraph (1) are that such standards shall–
”(A) be unique with no conflicting or re-
dundant standards;
”(B) be authoritative, permitting no addi-
tions or constraints for electronic transactions,
including companion guides;

P. 58

”(C) be comprehensive, efficient and ro-
bust, requiring minimal augmentation by paper
transactions or clarification by further commu-
nications;
”(D) enable the real-time (or near real-
time) determination of an individual’s financial
responsibility at the point of service and, to the
extent possible, prior to service, including
whether the individual is eligible for a specific
service with a specific physician at a specific fa-
cility, which may include utilization of a ma-
chine-readable health plan beneficiary identi-
fication card;
”(E) enable, where feasible, near real-time
adjudication of claims;
”(F) provide for timely acknowledgment,
response, and status reporting applicable to any
electronic transaction deemed appropriate by
the Secretary;
”(G) describe all data elements (such as
reason and remark codes) in unambiguous
terms, not permit optional fields, require that
data elements be either required or conditioned
upon set values in other fields, and prohibit ad-
ditional conditions; and

P. 59

”(H) harmonize all common data elements
across administrative and clinical transaction
standards.
”(3) TIME FOR ADOPTION.–Not later than 2
years after the date of implementation of the X12
Version 5010 transaction standards implemented
under this part, the Secretary shall adopt standards
under this section.
”(4) REQUIREMENTS FOR SPECIFIC STAND-
ARDS.–The standards under this section shall be
developed, adopted and enforced so as to–
”(A) clarify, refine, complete, and expand,
as needed, the standards required under section
1173;
”(B) require paper versions of standard-
ized transactions to comply with the same
standards as to data content such that a fully
compliant, equivalent electronic transaction can
be populated from the data from a paper
version;
”(C) enable electronic funds transfers, in
order to allow automated reconciliation with the
related health care payment and remittance ad-
vice;

P. 60

”(D) require timely and transparent claim
and denial management processes, including
tracking, adjudication, and appeal processing ;
”(E) require the use of a standard elec-
tronic transaction with which health care pro-
viders may quickly and efficiently enroll with a
health plan to conduct the other electronic
transactions provided for in this part; and
”(F) provide for other requirements relat-
ing to administrative simplification as identified
by the Secretary, in consultation with stake-
holders.
”(5) BUILDING ON EXISTING STANDARDS.–In
developing the standards under this section, the Sec-
retary shall build upon existing and planned stand-
ards.
”(6) IMPLEMENTATION AND ENFORCEMENT.–
Not later than 6 months after the date of the enact-
ment of this section, the Secretary shall submit to
the appropriate committees of Congress a plan for
the implementation and enforcement, by not later
than 5 years after such date of enactment, of the
standards under this section. Such plan shall in-
clude–

P. 61

”(A) a process and timeframe with mile-
stones for developing the complete set of stand-
ards;
”(B) an expedited upgrade program for
continually developing and approving additions
and modifications to the standards as often as
annually to improve their quality and extend
their functionality to meet evolving require-
ments in health care;
”(C) programs to provide incentives for,
and ease the burden of, implementation for cer-
tain health care providers, with special consid-
eration given to such providers serving rural or
underserved areas and ensure coordination with
standards, implementation specifications, and
certification criteria being adopted under the
HITECH Act;
”(D) programs to provide incentives for,
and ease the burden of, health care providers
who volunteer to participate in the process of
setting standards for electronic transactions;
”(E) an estimate of total funds needed to
ensure timely completion of the implementation
plan; and

P. 62

”(F) an enforcement process that includes
timely investigation of complaints, random au-
dits to ensure compliance, civil monetary and
programmatic penalties for non-compliance con-
sistent with existing laws and regulations, and
a fair and reasonable appeals process building
off of enforcement provisions under this part.
”(b) LIMITATIONS ON USE OF DATA.–Nothing in
this section shall be construed to permit the use of infor-
mation collected under this section in a manner that would
adversely affect any individual.
”(c) PROTECTION OF DATA.–The Secretary shall en-
sure (through the promulgation of regulations or other-
wise) that all data collected pursuant to subsection (a)
are–
”(1) used and disclosed in a manner that meets
the HIPAA privacy and security law (as defined in
section 3009(a)(2) of the Public Health Service
Act), including any privacy or security standard
adopted under section 3004 of such Act; and
”(2) protected from all inappropriate internal
use by any entity that collects, stores, or receives the
data, including use of such data in determinations of
eligibility (or continued eligibility) in health plans,

P. 63

and from other inappropriate uses, as defined by the
Secretary.”.
(2) DEFINITIONS.–Section 1171 of such Act
(42 U.S.C. 1320d) is amended–
(A) in paragraph (7), by striking ”with
reference to” and all that follows and inserting
”with reference to a transaction or data ele-
ment of health information in section 1173
means implementation specifications, certifi-
cation criteria, operating rules, messaging for-
mats, codes, and code sets adopted or estab-
lished by the Secretary for the electronic ex-
change and use of information”; and
(B) by adding at the end the following new
paragraph:
”(9) OPERATINGRULES.–The term ‘operating
rules’ means business rules for using and processing
transactions. Operating rules should address the fol-
lowing:
”(A) Requirements for data content using
available and established national standards.
”(B) Infrastructure requirements that es-
tablish best practices for streamlining data flow
to yield timely execution of transactions.

P. 64

”(C) Policies defining the transaction re-
lated rights and responsibilities for entities that
are transmitting or receiving data.”.
(3) CONFORMING AMENDMENT.–Section
1179(a) of such Act (42 U.S.C. 1320d-8(a)) is
amended, in the matter before paragraph (1)–
(A) by inserting ”on behalf of an indi-
vidual” after ”1978)”; and
(B) by inserting ”on behalf of an indi-
vidual” after ”for a financial institution” and
(b) STANDARDS FOR CLAIMS ATTACHMENTS AND
COORDINATION OF BENEFITS.–
(1) STANDARDFORHEALTHCLAIMS ATTACH-
MENTS.–Not later than 1 year after the date of the
enactment of this Act, the Secretary of Health and
Human Services shall promulgate a final rule to es-
tablish a standard for health claims attachment
transaction described in section 1173(a)(2)(B) of the
Social Security Act (42 U.S.C. 1320d-2(a)(2)(B))
and coordination of benefits.
(2) REVISIONINPROCESSINGPAYMENTTRANS-
ACTIONSBYFINANCIALINSTITUTIONS.–
(A) INGENERAL.–Section 1179 of the So-
cial Security Act (42 U.S.C. 1320d-8) is
amended, in the matter before paragraph (1)–

P. 65

(i) by striking ”or is engaged” and in-
serting ”and is engaged”; and
(ii) by inserting ”(other than as a
business associate for a covered entity)”
after ”for a financial institution”.
(B) EFFECTIVEDATE.–The amendments
made by paragraph (1) shall apply to trans-
actions occurring on or after such date (not
later than 6 months after the date of the enact-
ment of this Act) as the Secretary of Health
and Human Services shall specify.
SEC. 164. REINSURANCE PROGRAM FOR RETIREES.
(a) ESTABLISHMENT.–
(1) INGENERAL.–Not later than 90 days after
the date of the enactment of this Act, the Secretary
of Health and Human Services shall establish a tem-
porary reinsurance program (in this section referred
to as the ”reinsurance program”) to provide reim-
bursement to assist participating employment-based
plans with the cost of providing health benefits to
retirees and to eligible spouses, surviving spouses
and dependents of such retirees.
(2) DEFINITIONS.–For purposes of this sec-
tion:

P. 66

(A) The term ”eligible employment-based
plan” means a group health benefits plan
that–
(i) is maintained by one or more em-
ployers, former employers or employee as-
sociations, or a voluntary employees’ bene-
ficiary association, or a committee or board
of individuals appointed to administer such
plan, and
(ii) provides health benefits to retir-
ees.
(B) The term ”health benefits” means
medical, surgical, hospital, prescription drug,
and such other benefits as shall be determined
by the Secretary, whether self-funded or deliv-
ered through the purchase of insurance or oth-
erwise.
(C) The term ”participating employment-
based plan” means an eligible employment-
based plan that is participating in the reinsur-
ance program.
(D) The term ”retiree” means, with re-
spect to a participating employment-benefit
plan, an individual who–
(i) is 55 years of age or older;

P. 67

(ii) is not eligible for coverage under
title XVIII of the Social Security Act; and
(iii) is not an active employee of an
employer maintaining the plan or of any
employer that makes or has made substan-
tial contributions to fund such plan.
(E) The term ”Secretary” means Sec-
retary of Health and Human Services.
(b) PARTICIPATION.–To be eligible to participate in
the reinsurance program, an eligible employment-based
plan shall submit to the Secretary an application for par-
ticipation in the program, at such time, in such manner,
and containing such information as the Secretary shall re-
quire.
(c) PAYMENT.–
(1) SUBMISSION OF CLAIMS.–
(A) IN GENERAL.–Under the reinsurance
program, a participating employment-based
plan shall submit claims for reimbursement to
the Secretary which shall contain documenta-
tion of the actual costs of the items and serv-
ices for which each claim is being submitted.
(B) BASIS FOR CLAIMS.–Each claim sub-
mitted under subparagraph (A) shall be based
on the actual amount expended by the partici-

P. 68

pating employment-based plan involved within
the plan year for the appropriate employment
based health benefits provided to a retiree or to
the spouse, surviving spouse, or dependent of a
retiree. In determining the amount of any claim
for purposes of this subsection, the partici-
pating employment-based plan shall take into
account any negotiated price concessions (such
as discounts, direct or indirect subsidies, re-
bates, and direct or indirect remunerations) ob-
tained by such plan with respect to such health
benefits. For purposes of calculating the
amount of any claim, the costs paid by the re-
tiree or by the spouse, surviving spouse, or de-
pendent of the retiree in the form of
deductibles, co-payments, and co-insurance shall
be included along with the amounts paid by the
participating employment-based plan.
(2) PROGRAM PAYMENTS AND LIMIT.–If the
Secretary determines that a participating employ-
ment-based plan has submitted a valid claim under
paragraph (1), the Secretary shall reimburse such
plan for 80 percent of that portion of the costs at-
tributable to such claim that exceeds $15,000, but is
less than $90,000. Such amounts shall be adjusted

P. 69

each year based on the percentage increase in the
medical care component of the Consumer Price
Index (rounded to the nearest multiple of $1,000)
for the year involved.
(3) USE OF PAYMENTS.–Amounts paid to a
participating employment-based plan under this sub-
section shall be used to lower the costs borne di-
rectly by the participants and beneficiaries for health
benefits provided under such plan in the form of
premiums, co-payments, deductibles, co-insurance, or
other out-of-pocket costs. Such payments shall not
be used to reduce the costs of an employer maintain-
ing the participating employment-based plan. The
Secretary shall develop a mechanism to monitor the
appropriate use of such payments by such plans.
(4) APPEALS AND PROGRAMPROTECTIONS.–
The Secretary shall establish–
(A) an appeals process to permit partici-
pating employment-based plans to appeal a de-
termination of the Secretary with respect to
claims submitted under this section; and
(B) procedures to protect against fraud,
waste, and abuse under the program.
(5) AUDITS.–The Secretary shall conduct an-
nual audits of claims data submitted by partici-

P. 70

pating employment-based plans under this section to
ensure that they are in compliance with the require-
ments of this section.
(d) RETIREE RESERVE TRUST FUND.–
(1) ESTABLISHMENT.–
(A) IN GENERAL.–There is established in
the Treasury of the United States a trust fund
to be known as the ”Retiree Reserve Trust
Fund” (referred to in this section as the ”Trust
Fund”), that shall consist of such amounts as
may be appropriated or credited to the Trust
Fund as provided for in this subsection to en-
able the Secretary to carry out the reinsurance
program. Such amounts shall remain available
until expended.
(B) FUNDING.–There are hereby appro-
priated to the Trust Fund, out of any moneys
in the Treasury not otherwise appropriated, an
amount requested by the Secretary as necessary
to carry out this section, except that the total
of all such amounts requested shall not exceed
$10,000,000,000.
(C) APPROPRIATIONS FROM THE TRUST
FUND.–

P. 71

(i) IN GENERAL.–Amounts in the
Trust Fund are appropriated to provide
funding to carry out the reinsurance pro-
gram and shall be used to carry out such
program.
(ii) BUDGETARY IMPLICATIONS.–
Amounts appropriated under clause (i),
and outlays flowing from such appropria-
tions, shall not be taken into account for
purposes of any budget enforcement proce-
dures including allocations under section
302(a) and (b) of the Balanced Budget
and Emergency Deficit Control Act and
budget resolutions for fiscal years during
which appropriations are made from the
Trust Fund.
(iii) LIMITATION TO AVAILABLE
FUNDS.–The Secretary has the authority
to stop taking applications for participa-
tion in the program or take such other
steps in reducing expenditures under the
reinsurance program in order to ensure
that expenditures under the reinsurance
program do not exceed the funds available
under this subsection.

P. 72

TITLE II–HEALTH INSURANCE
EXCHANGE AND RELATED
PROVISIONS
Subtitle A–Health Insurance
Exchange
SEC. 201. ESTABLISHMENT OF HEALTH INSURANCE EX-
CHANGE; OUTLINE OF DUTIES; DEFINITIONS.
(a) ESTABLISHMENT.–There is established within
the Health Choices Administration and under the direc-
tion of the Commissioner a Health Insurance Exchange
in order to facilitate access of individuals and employers,
through a transparent process, to a variety of choices of
affordable, quality health insurance coverage, including a
public health insurance option.
(b) OUTLINEOFDUTIESOFCOMMISSIONER.–In ac-
cordance with this subtitle and in coordination with appro-
priate Federal and State officials as provided under sec-
tion 143(b), the Commissioner shall–
(1) under section 204 establish standards for,
accept bids from, and negotiate and enter into con-
tracts with, QHBP offering entities for the offering
of health benefits plans through the Health Insur-
ance Exchange, with different levels of benefits re-
quired under section 203, and including with respect
to oversight and enforcement;

P. 73

(2) under section 205 facilitate outreach and
enrollment in such plans of Exchange-eligible indi-
viduals and employers described in section 202; and
(3) conduct such activities related to the Health
Insurance Exchange as required, including establish-
ment of a risk pooling mechanism under section 206
and consumer protections under subtitle D of title I.
(c) EXCHANGE-PARTICIPATING HEALTH BENEFITS
PLAN DEFINED.–In this division, the term ”Exchange-
participating health benefits plan” means a qualified
health benefits plan that is offered through the Health In-
surance Exchange.
SEC. 202. EXCHANGE-ELIGIBLE INDIVIDUALS AND EMPLOY-
ERS.
(a) ACCESSTOCOVERAGE.–In accordance with this
section, all individuals are eligible to obtain coverage
through enrollment in an Exchange-participating health
benefits plan offered through the Health Insurance Ex-
change unless such individuals are enrolled in another
qualified health benefits plan or other acceptable coverage.
(b) DEFINITIONS.–In this division:
(1) EXCHANGE-ELIGIBLE INDIVIDUAL.–The
term ”Exchange-eligible individual” means an indi-
vidual who is eligible under this section to be en-
rolled through the Health Insurance Exchange in an

P. 74

Exchange-participating health benefits plan and,
with respect to family coverage, includes dependents
of such individual.
(2) EXCHANGE-ELIGIBLE EMPLOYER.–The
term ”Exchange-eligible employer” means an em-
ployer that is eligible under this section to enroll
through the Health Insurance Exchange employees
of the employer (and their dependents) in Exchange-
eligible health benefits plans.
(3) EMPLOYMENT-RELATED DEFINITIONS.–
The terms ”employer”, ”employee”, ”full-time em-
ployee”, and ”part-time employee” have the mean-
ings given such terms by the Commissioner for pur-
poses of this division.
(c) TRANSITION.–Individuals and employers shall
only be eligible to enroll or participate in the Health Insur-
ance Exchange in accordance with the following transition
schedule:
(1) FIRSTYEAR.–In Y1 (as defined in section
100(c))–
(A) individuals described in subsection
(d)(1), including individuals described in para-
graphs (3) and (4) of subsection (d); and
(B) smallest employers described in sub-
section (e)(1).

P. 75

(2) SECOND YEAR.–In Y2–
(A) individuals and employers described in
paragraph (1); and
(B) smaller employers described in sub-
section (e)(2).
(3) THIRD AND SUBSEQUENT YEARS.–In Y3
and subsequent years–
(A) individuals and employers described in
paragraph (2); and
(B) larger employers as permitted by the
Commissioner under subsection (e)(3).
(d) INDIVIDUALS.–
(1) INDIVIDUAL DESCRIBED.–Subject to the
succeeding provisions of this subsection, an indi-
vidual described in this paragraph is an individual
who–
(A) is not enrolled in coverage described in
subparagraphs (C) through (F) of paragraph
(2); and
(B) is not enrolled in coverage as a full-
time employee (or as a dependent of such an
employee) under a group health plan if the cov-
erage and an employer contribution under the
plan meet the requirements of section 312.

P. 76

For purposes of subparagraph (B), in the case of an
individual who is self-employed, who has at least 1
employee, and who meets the requirements of section
312, such individual shall be deemed a full-time em-
ployee described in such subparagraph.
(2) ACCEPTABLECOVERAGE.–For purposes of
this division, the term ”acceptable coverage” means
any of the following:
(A) QUALIFIEDHEALTHBENEFITS PLAN
COVERAGE.–Coverage under a qualified health
benefits plan.
(B) GRANDFATHEREDHEALTHINSURANCE
COVERAGE; COVERAGEUNDERCURRENTGROUP
HEALTH PLAN.–Coverage under a grand-
fathered health insurance coverage (as defined
in subsection (a) of section 102) or under a
current group health plan (described in sub-
section (b) of such section).
(C) MEDICARE.–Coverage under part A of
title XVIII of the Social Security Act.
(D) MEDICAID.–Coverage for medical as-
sistance under title XIX of the Social Security
Act, excluding such coverage that is only avail-
able because of the application of subsection
(u), (z), or (aa) of section 1902 of such Act

P. 77

(E) MEMBERS OF THE ARMED FORCES
AND DEPENDENTS (INCLUDING TRICARE).–
Coverage under chapter 55 of title 10, United
States Code, including similar coverage fur-
nished under section 1781 of title 38 of such
Code.
(F) VA.–Coverage under the veteran’s
health care program under chapter 17 of title
38, United States Code, but only if the cov-
erage for the individual involved is determined
by the Commissioner in coordination with the
Secretary of Treasury to be not less than a level
specified by the Commissioner and Secretary of
Veteran’s Affairs, in coordination with the Sec-
retary of Treasury, based on the individual’s
priority for services as provided under section
1705(a) of such title.
(G) OTHER COVERAGE.–Such other health
benefits coverage, such as a State health bene-
fits risk pool, as the Commissioner, in coordina-
tion with the Secretary of the Treasury, recog-
nizes for purposes of this paragraph.
The Commissioner shall make determinations under
this paragraph in coordination with the Secretary of
the Treasury.

P. 78
(3) TREATMENT OF CERTAIN NON-TRADI-
TIONAL MEDICAID ELIGIBLE INDIVIDUALS.–An indi-
vidual who is a non-traditional Medicaid eligible in-
dividual (as defined in section 205(e)(4)(C)) in a
State may be an Exchange-eligible individual if the
individual was enrolled in a qualified health benefits
plan, grandfathered health insurance coverage, or
current group health plan during the 6 months be-
fore the individual became a non-traditional Med-
icaid eligible individual. During the period in which
such an individual has chosen to enroll in an Ex-
change-participating health benefits plan, the indi-
vidual is not also eligible for medical assistance
under Medicaid.
(4) CONTINUINGELIGIBILITYPERMITTED.–
(A) INGENERAL.–Except as provided in
subparagraph (B), once an individual qualifies
as an Exchange-eligible individual under this
subsection (including as an employee or depend-
ent of an employee of an Exchange-eligible em-
ployer) and enrolls under an Exchange-partici-
pating health benefits plan through the Health
Insurance Exchange, the individual shall con-
tinue to be treated as an Exchange-eligible indi-
vidual until the individual is no longer enrolled

P. 79

with an Exchange-participating health benefits
plan.
(B) EXCEPTIONS.–
(i) IN GENERAL.–Subparagraph (A)
shall not apply to an individual once the
individual becomes eligible for coverage–
(I) under part A of the Medicare
program;
(II) under the Medicaid program
as a Medicaid eligible individual, ex-
cept as permitted under paragraph
(3) or clause (ii); or
(III) in such other circumstances
as the Commissioner may provide.
(ii) TRANSITION PERIOD.–In the case
described in clause (i)(II), the Commis-
sioner shall permit the individual to con-
tinue treatment under subparagraph (A)
until such limited time as the Commis-
sioner determines it is administratively fea-
sible, consistent with minimizing disruption
in the individual’s access to health care.
(e) EMPLOYERS.–

P. 80

(1) SMALLEST EMPLOYER.–Subject to para-
graph (4), smallest employers described in this para-
graph are employers with 10 or fewer employees.
(2) SMALLER EMPLOYERS.–Subject to para-
graph (4), smaller employers described in this para-
graph are employers that are not smallest employers
described in paragraph (1) and have 20 or fewer em-
ployees.
(3) LARGEREMPLOYERS.–
(A) INGENERAL.–Beginning with Y3, the
Commissioner may permit employers not de-
scribed in paragraph (1) or (2) to be Exchange-
eligible employers.
(B) PHASE-IN.–In applying subparagraph
(A), the Commissioner may phase-in the appli-
cation of such subparagraph based on the num-
ber of full-time employees of an employer and
such other considerations as the Commissioner
deems appropriate.
(4) CONTINUING ELIGIBILITY.–Once an em-
ployer is permitted to be an Exchange-eligible em-
ployer under this subsection and enrolls employees
through the Health Insurance Exchange, the em-
ployer shall continue to be treated as an Exchange-
eligible employer for each subsequent plan year re-

P. 81

gardless of the number of employees involved unless
and until the employer meets the requirement of sec-
tion 311(a) through paragraph (1) of such section
by offering a group health plan and not through of-
fering Exchange-participating health benefits plan.
(5) EMPLOYER PARTICIPATION AND CONTRIBU-
TIONS.–
(A) SATISFACTION OF EMPLOYER RESPON-
SIBILITY.–For any year in which an employer
is an Exchange-eligible employer, such employer
may meet the requirements of section 312 with
respect to employees of such employer by offer-
ing such employees the option of enrolling with
Exchange-participating health benefits plans
through the Health Insurance Exchange con-
sistent with the provisions of subtitle B of title
III.
(B) EMPLOYEE CHOICE.–Any employee
offered Exchange-participating health benefits
plans by the employer of such employee under
subparagraph (A) may choose coverage under
any such plan. That choice includes, with re-
spect to family coverage, coverage of the de-
pendents of such employee.

P. 82

(6) AFFILIATED GROUPS.–Any employer which
is part of a group of employers who are treated as
a single employer under subsection (b), (c), (m), or
(o) of section 414 of the Internal Revenue Code of
1986 shall be treated, for purposes of this subtitle,
as a single employer.
(7) OTHER COUNTING RULES.–The Commis-
sioner shall establish rules relating to how employees
are counted for purposes of carrying out this sub-
section.
(f) SPECIALSITUATIONAUTHORITY.–The Commis-
sioner shall have the authority to establish such rules as
may be necessary to deal with special situations with re-
gard to uninsured individuals and employers participating
as Exchange-eligible individuals and employers, such as
transition periods for individuals and employers who gain,
or lose, Exchange-eligible participation status, and to es-
tablish grace periods for premium payment.
(g) SURVEYS OF INDIVIDUALS AND EMPLOYERS.–
The Commissioner shall provide for periodic surveys of
Exchange-eligible individuals and employers concerning
satisfaction of such individuals and employers with the
Health Insurance Exchange and Exchange-participating
health benefits plans.
(h) EXCHANGE ACCESS STUDY.–

P. 83

(1) IN GENERAL.–The Commissioner shall con-
duct a study of access to the Health Insurance Ex-
change for individuals and for employers, including
individuals and employers who are not eligible and
enrolled in Exchange-participating health benefits
plans. The goal of the study is to determine if there
are significant groups and types of individuals and
employers who are not Exchange eligible individuals
or employers, but who would have improved benefits
and affordability if made eligible for coverage in the
Exchange.
(2) ITEMS INCLUDED IN STUDY.–Such study
also shall examine–
(A) the terms, conditions, and affordability
of group health coverage offered by employers
and QHBP offering entities outside of the Ex-
change compared to Exchange-participating
health benefits plans; and
(B) the affordability-test standard for ac-
cess of certain employed individuals to coverage
in the Health Insurance Exchange.
(3) REPORT.–Not later than January 1 of Y3,
in Y6, and thereafter, the Commissioner shall sub-
mit to Congress on the study conducted under this
subsection and shall include in such report rec-

P. 84

ommendations regarding changes in standards for
Exchange eligibility for for individuals and employ-
ers.
SEC. 203. BENEFITS PACKAGE LEVELS.
(a) IN GENERAL.–The Commissioner shall specify
the benefits to be made available under Exchange-partici-
pating health benefits plans during each plan year, con-
sistent with subtitle C of title I and this section.
(b) LIMITATIONON HEALTH BENEFITS PLANS OF-
FERED BY OFFERING ENTITIES.–The Commissioner may
not enter into a contract with a QHBP offering entity
under section 204(c) for the offering of an Exchange-par-
ticipating health benefits plan in a service area unless the
following requirements are met:
(1) REQUIRED OFFERING OF BASIC PLAN.–The
entity offers only one basic plan for such service
area.
(2) OPTIONAL OFFERING OF ENHANCED
PLAN.–If and only if the entity offers a basic plan
for such service area, the entity may offer one en-
hanced plan for such area.
(3) OPTIONAL OFFERING OF PREMIUM PLAN.–
If and only if the entity offers an enhanced plan for
such service area, the entity may offer one premium
plan for such area.

P. 85

(4) OPTIONAL OFFERING OF PREMIUM-PLUS
PLANS.–If and only if the entity offers a premium
plan for such service area, the entity may offer one
or more premium-plus plans for such area.
All such plans may be offered under a single contract with
the Commissioner.
(c) SPECIFICATION OF BENEFIT LEVELS FOR
PLANS.–
(1) IN GENERAL.–The Commissioner shall es-
tablish the following standards consistent with this
subsection and title I:
(A) BASIC, ENHANCED, AND PREMIUM
PLANS.–Standards for 3 levels of Exchange-
participating health benefits plans: basic, en-
hanced, and premium (in this division referred
to as a ”basic plan”, ”enhanced plan”, and
”premium plan”, respectively).
(B) PREMIUM-PLUS PLAN BENEFITS.–
Standards for additional benefits that may be
offered, consistent with this subsection and sub-
title C of title I, under a premium plan (such
a plan with additional benefits referred to in
this division as a ”premium-plus plan”) .
(2) BASICPLAN.–

P. 86

(A) INGENERAL.–A basic plan shall offer
the essential benefits package required under
title I for a qualified health benefits plan.
(B) TIEREDCOST-SHARINGFORAFFORD-
ABLECREDITELIGIBLEINDIVIDUALS.–In the
case of an affordable credit eligible individual
(as defined in section 242(a)(1)) enrolled in an
Exchange-participating health benefits plan, the
benefits under a basic plan are modified to pro-
vide for the reduced cost-sharing for the income
tier applicable to the individual under section
244(c).
(3) ENHANCEDPLAN.–A enhanced plan shall
offer, in addition to the level of benefits under the
basic plan, a lower level of cost-sharing as provided
under title I consistent with section 123(b)(5)(A).
(4) PREMIUM PLAN.–A premium plan shall
offer, in addition to the level of benefits under the
basic plan, a lower level of cost-sharing as provided
under title I consistent with section 123(b)(5)(B).
(5) PREMIUM-PLUS PLAN.–A premium-plus
plan is a premium plan that also provides additional
benefits, such as adult oral health and vision care,
approved by the Commissioner. The portion of the

P. 87

premium that is attributable to such additional ben-
efits shall be separately specified.
(6) RANGE OF PERMISSIBLE VARIATION IN
COST-SHARING.–The Commissioner shall establish a
permissible range of variation of cost-sharing for
each basic, enhanced, and premium plan, except with
respect to any benefit for which there is no cost-
sharing permitted under the essential benefits pack-
age. Such variation shall permit a variation of not
more than plus (or minus) 10 percent in cost-shar-
ing with respect to each benefit category specified
under section 122.
(d) TREATMENTOFSTATEBENEFITMANDATES.–
Insofar as a State requires a health insurance issuer offer-
ing health insurance coverage to include benefits beyond
the essential benefits package, such requirement shall con-
tinue to apply to an Exchange-participating health bene-
fits plan, if the State has entered into an arrangement
satisfactory to the Commissioner to reimburse the Com-
missioner for the amount of any net increase in afford-
ability premium credits under subtitle C as a result of an
increase in premium in basic plans as a result of applica-
tion of such requirement.

P. 88

SEC. 204. CONTRACTS FOR THE OFFERING OF EXCHANGE-
PARTICIPATING HEALTH BENEFITS PLANS.
(a) CONTRACTINGDUTIES.–In carrying out section
201(b)(1) and consistent with this subtitle:
(1) OFFERING ENTITY AND PLAN STAND-
ARDS.–The Commissioner shall–
(A) establish standards necessary to imple-
ment the requirements of this title and title I
for–
(i) QHBP offering entities for the of-
fering of an Exchange-participating health
benefits plan; and
(ii) for Exchange-participating health
benefits plans; and
(B) certify QHBP offering entities and
qualified health benefits plans as meeting such
standards and requirements of this title and
title I for purposes of this subtitle.
(2) SOLICITINGANDNEGOTIATINGBIDS; CON-
TRACTS.–The Commissioner shall–
(A) solicit bids from QHBP offering enti-
ties for the offering of Exchange-participating
health benefits plans;
(B) based upon a review of such bids, ne-
gotiate with such entities for the offering of
such plans; and

P. 89

(C) enter into contracts with such entities
for the offering of such plans through the
Health Insurance Exchange under terms (con-
sistent with this title) negotiated between the
Commissioner and such entities.
(3) FAR NOTAPPLICABLE.–The provisions of
the Federal Acquisition Regulation shall not apply to
contracts between the Commissioner and QHBP of-
fering entities for the offering of Exchange-partici-
pating health benefits plans under this title.
(b) STANDARDSFORQHBP OFFERINGENTITIESTO
OFFER EXCHANGE-PARTICIPATING HEALTH BENEFITS
PLANS.–The standards established under subsection
(a)(1)(A) shall require that, in order for a QHBP offering
entity to offer an Exchange-participating health benefits
plan, the entity must meet the following requirements:
(1) LICENSED.–The entity shall be licensed to
offer health insurance coverage under State law for
each State in which it is offering such coverage.
(2) DATA REPORTING.–The entity shall pro-
vide for the reporting of such information as the
Commissioner may specify, including information
necessary to administer the risk pooling mechanism
described in section 206(b) and information to ad-
dress disparities in health and health care.

P. 90

(3) IMPLEMENTING AFFORDABILITY CRED-
ITS.–The entity shall provide for implementation of
the affordability credits provided for enrollees under
subtitle C, including the reduction in cost-sharing
under section 244(c).
(4) ENROLLMENT.–The entity shall accept all
enrollments under this subtitle, subject to such ex-
ceptions (such as capacity limitations) in accordance
with the requirements under title I for a qualified
health benefits plan. The entity shall notify the
Commissioner if the entity projects or anticipates
reaching such a capacity limitation that would result
in a limitation in enrollment.
(5) RISKPOOLINGPARTICIPATION.–The entity
shall participate in such risk pooling mechanism as
the Commissioner establishes under section 206(b).
(6) ESSENTIALCOMMUNITYPROVIDERS.–With
respect to the basic plan offered by the entity, the
entity shall contract for outpatient services with cov-
ered entities (as defined in section 340B(a)(4) of the
Public Health Service Act, as in effect as of July 1,
2009). The Commissioner shall specify the extent to
which and manner in which the previous sentence
shall apply in the case of a basic plan with respect
to which the Commissioner determines provides sub-

P. 91

stantially all benefits through a health maintenance
organization, as defined in section 2791(b)(3) of the
Public Health Service Act.
(7) CULTURALLY AND LINGUISTICALLY APPRO-
PRIATE SERVICES AND COMMUNICATIONS.–The en-
tity shall provide for culturally and linguistically ap-
propriate communication and health services.
(8) ADDITIONAL REQUIREMENTS.–The entity
shall comply with other applicable requirements of
this title, as specified by the Commissioner, which
shall include standards regarding billing and collec-
tion practices for premiums and related grace peri-
ods and which may include standards to ensure that
the entity does not use coercive practices to force
providers not to contract with other entities offering
coverage through the Health Insurance Exchange.
(c) CONTRACTS.–
(1) BID APPLICATION.–To be eligible to enter
into a contract under this section, a QHBP offering
entity shall submit to the Commissioner a bid at
such time, in such manner, and containing such in-
formation as the Commissioner may require.
(2) TERM.–Each contract with a QHBP offer-
ing entity under this section shall be for a term of
not less than one year, but may be made automati-

P. 92

cally renewable from term to term in the absence of
notice of termination by either party.
(3) ENFORCEMENT OF NETWORK ADEQUACY.–
In the case of a health benefits plan of a QHBP of-
fering entity that uses a provider network, the con-
tract under this section with the entity shall provide
that if–
(A) the Commissioner determines that
such provider network does not meet such
standards as the Commissioner shall establish
under section 115; and
(B) an individual enrolled in such plan re-
ceives an item or service from a provider that
is not within such network;
then any cost-sharing for such item or service shall
be equal to the amount of such cost-sharing that
would be imposed if such item or service was fur-
nished by a provider within such network.
(4) OVERSIGHT AND ENFORCEMENT RESPON-
SIBILITIES.–The Commissioner shall establish proc-
esses, in coordination with State insurance regu-
lators, to oversee, monitor, and enforce applicable re-
quirements of this title with respect to QHBP offer-
ing entities offering Exchange-participating health
benefits plans and such plans, including the mar-

P. 93

keting of such plans. Such processes shall include
the following:
(A) GRIEVANCE AND COMPLAINT MECHA-
NISMS.–The Commissioner shall establish, in
coordination with State insurance regulators, a
process under which Exchange-eligible individ-
uals and employers may file complaints con-
cerning violations of such standards.
(B) ENFORCEMENT.–In carrying out au-
thorities under this division relating to the
Health Insurance Exchange, the Commissioner
may impose one or more of the intermediate
sanctions described in section 142(c).
(C) TERMINATION.–
(i) IN GENERAL.–The Commissioner
may terminate a contract with a QHBP of-
fering entity under this section for the of-
fering of an Exchange-participating health
benefits plan if such entity fails to comply
with the applicable requirements of this
title. Any determination by the Commis-
sioner to terminate a contract shall be
made in accordance with formal investiga-
tion and compliance procedures established
by the Commissioner under which–

P. 94

(I) the Commissioner provides
the entity with the reasonable oppor-
tunity to develop and implement a
corrective action plan to correct the
deficiencies that were the basis of the
Commissioner’s determination; and
(II) the Commissioner provides
the entity with reasonable notice and
opportunity for hearing (including the
right to appeal an initial decision) be-
fore terminating the contract.
(ii) EXCEPTION FOR IMMINENT AND
SERIOUS RISK TO HEALTH.–Clause (i)
shall not apply if the Commissioner deter-
mines that a delay in termination, result-
ing from compliance with the procedures
specified in such clause prior to termi-
nation, would pose an imminent and seri-
ous risk to the health of individuals en-
rolled under the qualified health benefits
plan of the QHBP offering entity.
(D) CONSTRUCTION.–Nothing in this sub-
section shall be construed as preventing the ap-
plication of other sanctions under subtitle E of

P. 95

title I with respect to an entity for a violation
of such a requirement.
SEC. 205. OUTREACH AND ENROLLMENT OF EXCHANGE-EL-
IGIBLE INDIVIDUALS AND EMPLOYERS IN EX-
CHANGE-PARTICIPATING HEALTH BENEFITS
PLAN.
(a) IN GENERAL.–
(1) OUTREACH.–The Commissioner shall con-
duct outreach activities consistent with subsection
(c), including through use of appropriate entities as
described in paragraph (4) of such subsection, to in-
form and educate individuals and employers about
the Health Insurance Exchange and Exchange-par-
ticipating health benefits plan options. Such out-
reach shall include outreach specific to vulnerable
populations, such as children, individuals with dis-
abilities, individuals with mental illness, and individ-
uals with other cognitive impairments.
(2) ELIGIBILITY.–The Commissioner shall
make timely determinations of whether individuals
and employers are Exchange-eligible individuals and
employers (as defined in section 202).
(3) ENROLLMENT.–The Commissioner shall es-
tablish and carry out an enrollment process for Ex-
change-eligible individuals and employers, including

P. 96

at community locations, in accordance with sub-
section (b).
(b) ENROLLMENTPROCESS.–
(1) INGENERAL.–The Commissioner shall es-
tablish a process consistent with this title for enroll-
ments in Exchange-participating health benefits
plans. Such process shall provide for enrollment
through means such as the mail, by telephone, elec-
tronically, and in person.
(2) ENROLLMENTPERIODS.–
(A) OPEN ENROLLMENT PERIOD.–The
Commissioner shall establish an annual open
enrollment period during which an Exchange-el-
igible individual or employer may elect to enroll
in an Exchange-participating health benefits
plan for the following plan year and an enroll-
ment period for affordability credits under sub-
title C. Such periods shall be during September
through November of each year, or such other
time that would maximize timeliness of income
verification for purposes of such subtitle. The
open enrollment period shall not be less than 30
days.
(B) SPECIAL ENROLLMENT.–The Com-
missioner shall also provide for special enroll-

P. 97

ment periods to take into account special cir-
cumstances of individuals and employers, such
as an individual who–
(i) loses acceptable coverage;
(ii) experiences a change in marital or
other dependent status;
(iii) moves outside the service area of
the Exchange-participating health benefits
plan in which the individual is enrolled; or
(iv) experiences a significant change
in income.
(C) ENROLLMENT INFORMATION.–The
Commissioner shall provide for the broad dis-
semination of information to prospective enroll-
ees on the enrollment process, including before
each open enrollment period. In carrying out
the previous sentence, the Commissioner may
work with other appropriate entities to facilitate
such provision of information.
(3) AUTOMATIC ENROLLMENT FOR NON-MED-
ICAID ELIGIBLE INDIVIDUALS.–
(A) IN GENERAL.–The Commissioner
shall provide for a process under which individ-
uals who are Exchange-eligible individuals de-
scribed in subparagraph (B) are automatically

P. 98

enrolled under an appropriate Exchange-partici-
pating health benefits plan. Such process may
involve a random assignment or some other
form of assignment that takes into account the
health care providers used by the individual in-
volved or such other relevant factors as the
Commissioner may specify.
(B) SUBSIDIZED INDIVIDUALS DE-
SCRIBED.–An individual described in this sub-
paragraph is an Exchange-eligible individual
who is either of the following:
(i) AFFORDABILITYCREDITELIGIBLE
INDIVIDUALS.–The individual–
(I) has applied for, and been de-
termined eligible for, affordability
credits under subtitle C;
(II) has not opted out from re-
ceiving such affordability credit; and
(III) does not otherwise enroll in
another Exchange-participating health
benefits plan.
(ii) INDIVIDUALS ENROLLED IN A
TERMINATEDPLAN.–The individual is en-
rolled in an Exchange-participating health
benefits plan that is terminated (during or

P. 99

at the end of a plan year) and who does
not otherwise enroll in another Exchange-
participating health benefits plan.
(4) DIRECT PAYMENT OF PREMIUMS TO
PLANS.–Under the enrollment process, individuals
enrolled in an Exchange-partcipating health benefits
plan shall pay such plans directly, and not through
the Commissioner or the Health Insurance Ex-
change.
(c) COVERAGE INFORMATION AND ASSISTANCE.–
(1) COVERAGE INFORMATION.–The Commis-
sioner shall provide for the broad dissemination of
information on Exchange-participating health bene-
fits plans offered under this title. Such information
shall be provided in a comparative manner, and shall
include information on benefits, premiums, cost-
sharing, quality, provider networks, and consumer
satisfaction.
(2) CONSUMERASSISTANCEWITHCHOICE.–To
provide assistance to Exchange-eligible individuals
and employers, the Commissioner shall–
(A) provide for the operation of a toll-free
telephone hotline to respond to requests for as-
sistance and maintain an Internet website
through which individuals may obtain informa-

P. 100

tion on coverage under Exchange-participating
health benefits plans and file complaints;
(B) develop and disseminate information to
Exchange-eligible enrollees on their rights and
responsibilities;
(C) assist Exchange-eligible individuals in
selecting Exchange-participating health benefits
plans and obtaining benefits through such
plans; and
(D) ensure that the Internet website de-
scribed in subparagraph (A) and the informa-
tion described in subparagraph (B) is developed
using plain language (as defined in section
133(a)(2)).
(3) USE OF OTHER ENTITIES.–In carrying out
this subsection, the Commissioner may work with
other appropriate entities to facilitate the dissemina-
tion of information under this subsection and to pro-
vide assistance as described in paragraph (2).
(d) SPECIAL DUTIES RELATED TO MEDICAID AND
CHIP.–
(1) COVERAGE FOR CERTAIN NEWBORNS.–
(A) IN GENERAL.–In the case of a child
born in the United States who at the time of
birth is not otherwise covered under acceptable

Continued On Section 3 (Pages 101-150)