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Health Security Act
Title V
TITLE V_QUALITY AND CONSUMER PROTECTION


table of contents of title
Subtitle A_Quality Management and Improvement
Sec._5001._National Quality Management Program.
Sec._5002._National Quality Management Council.
Sec._5003._National measures of quality performance.
Sec._5004._Consumer surveys.
Sec._5005._Evaluation and reporting of quality performance.
Sec._5006._Development and dissemination of practice guidelines.
Sec._5007._Research on health care quality.
Sec._5008._Regional professional foundations.
Sec._5009._National Quality Consortium.
Sec._5010._Eliminating CLIA requirement for certificate of waiver
for simple laboratory examinations and procedures.
Sec._5012._Role of alliances in quality assurance.
Sec._5013._Role of health plans in quality management.
Subtitle B_Information Systems, Privacy, and Administrative
Simplification
Part 1_Health Information Systems
Sec._5101._Establishment of health information system.
Sec._5102._Additional requirements for health information system.
Sec._5103._Electronic data network.
Sec._5104._Unique identifier numbers.
Sec._5105._Health security cards.
Sec._5106._Technical assistance in the establishment of health
information systems.
Part 2_Privacy of Information
Sec._5120._Health information system privacy standards.
Sec._5121._Other duties with respect to privacy.
Sec._5122._Comprehensive health information privacy protection
act.
Sec._5123._Definitions.
Part 3_Interim Requirements for Administrative Simplification
Sec._5130._Standard benefit forms.
Part 4_General Provisions
Sec._5140._National Privacy and Health Data Advisory Council.
Sec._5141._Civil money penalties.
Sec._5142._Relationship to other laws.
Subtitle C_Remedies and Enforcement
Part 1_Review of Benefit Determinations for Enrolled Individuals
SUBPART A_GENERAL RULES
Sec._5201._Health plan claims procedure.
Sec._5202._Review in regional alliance complaint review offices
of grievances based on acts or practices by health plans.
Sec._5203._Initial proceedings in complaint review offices.
Sec._5204._Hearings before hearing officers in complaint review
offices.
Sec._5205._Review by Federal Health Plan Review Board.
Sec._5206._Civil money penalties.
SUBPART B_EARLY RESOLUTION PROGRAMS
Sec._5211._Establishment of early resolution programs in
complaint review offices.
Sec._5212._Initiation of participation in mediation proceedings.
Sec._5213._Mediation proceedings.
Sec._5214._Legal effect of participation in mediation
proceedings.
Sec._5215._Enforcement of settlement agreements.
Part 2_Additional Remedies and Enforcement Provisions
Sec._5231._Judicial review of Federal action on State systems.
Sec._5232._Administrative and judicial review relating to cost
containment.
Sec._5233._Civil enforcement.
Sec._5234._Priority of certain bankruptcy claims.
Sec._5235._Private right to enforce State responsibilities.
Sec._5236._Private right to enforce Federal responsibilities in
operating a system in a State.
Sec._5237._Private right to enforce responsibilities of
alliances.
Sec._5238._Discrimination claims.
Sec._5239._Nondiscrimination in federally assisted programs.
Sec._5240._Civil action by essential community provider.
Sec._5241._Facial constitutional challenges.
Sec._5242._Treatment of plans as parties in civil actions.
Sec._5243._General nonpreemption of existing rights and remedies.
Subtitle D_Medical Malpractice
Part 1_Liability Reform
Sec._5301._Federal tort reform.
Sec._5302._Plan-based alternative dispute resolution mechanisms.
Sec._5303._Requirement for certificate of merit.
Sec._5304._Limitation on amount of attorney's contingency fees.
Sec._5305._Reduction of awards for recovery from collateral
sources.
Sec._5306._Periodic payment of awards.
Part 2_Other Provisions Relating to Medical Malpractice Liability
Sec._5311._Enterprise liability demonstration project.
Sec._5312._Pilot program applying practice guidelines to medical
malpractice liability actions.
Subtitle E_Fraud and Abuse
Part 1_Establishment of All-payer Health Care Fraud and Abuse
Control Program
Sec._5401._All-Payer Health Care Fraud and Abuse Control Program.
Sec._5402._Establishment of All-Payer Health Care Fraud and Abuse
Control Account.
Sec._5403._Use of funds by Inspector General.
Part 2_Application of Fraud and Abuse Authorities Under the
Social Security Act to All Payers
Sec._5411._Exclusion from participation.
Sec._5412._Civil monetary penalties.
Sec._5413._Limitations on physician self-referral.
Sec._5414._Construction of Social Security Act references.
Part 3_Amendments to Anti-fraud and Abuse Provisions Under the
Social Security Act
Sec._5421._Reference to amendments.
Part 4_Amendments to Criminal Law
Sec._5431._Health care fraud.
Sec._5432._Forfeitures for violations of fraud statutes.
Sec._5433._False statements.
Sec._5434._Bribery and graft.
Sec._5435._Injunctive relief relating to health care offenses.
Sec._5436._Grand jury disclosure.
Sec._5437._Theft or embezzlement.
Sec._5438._Misuse of health security card or unique identifier.
Part 5_Amendments to Civil False Claims Act
Sec._5441._Amendments to Civil False Claims Act.
Subtitle F_McCarran-Ferguson Reform
Sec._5501._Repeal of exemption for health insurance.

Title V, Subtitle A
Subtitle A_Quality Management and Improvement
SEC. 5001. NATIONAL QUALITY MANAGEMENT PROGRAM.
__Not later than 1 year after the date of the enactment of this
Act, the National Health Board shall establish and oversee a
performance-based program of quality management and improvement
designed to enhance the quality, appropriateness, and
effectiveness of health care services and access to such
services. The program shall be known as the National Quality
Management Program and shall be administered by the National
Quality Management Council established under section 5002.
SEC. 5002. NATIONAL QUALITY MANAGEMENT COUNCIL.
__(a) Establishment._There is established a council to be known
as the National Quality Management Council.
__(b) Duties._The Council shall_
__(1) administer the National Quality Management Program;
__(2) perform any other duty specified as a duty of the Council
in this subtitle; and
__(3) advise the National Health Board with respect its duties
under this subtitle.
__(c) Number and Appointment._The Council shall be composed of 15
members appointed by the President. The Council shall consist of
members who are broadly representative of the population of the
United States and shall include_
__(1) individuals representing the interests of governmental and
corporate purchasers of health care;
__(2) individuals representing the interests of health plans;
__(3) individuals representing the interests of States;
__(4) individuals representing the interests of health care
providers and academic health centers (as defined in section
3101(c)); and
__(5) individuals distinguished in the fields of public health,
health care quality, and related fields of health services
research.
__(d) Terms._
__(1) In general._Except as provided in paragraph (2), members of
the Council shall serve for a term of 3 years.
__(2) Staggered rotation._Of the members first appointed to the
Council under subsection (c), the President shall appoint 5
members to serve for a term of 3 years, 5 members to serve for a
term of 2 years, and 5 members to serve for a term of 1 year.
__(3) Service beyond term._A member of the Council may continue
to serve after the expiration of the term of the member until a
successor is appointed.
__(e) Vacancies._If a member of the Council does not serve the
full term applicable under subsection (d), the individual
appointed to fill the resulting vacancy shall be appointed for
the remainder of the term of the predecessor of the individual.
__(f) Chair._The President shall designate an individual to serve
as the chair of the Council.
__(g) Meetings._The Council shall meet not less than once during
each discrete 4-month period and shall otherwise meet at the call
of the President or the chair.
__(h) Compensation and Reimbursement of Expenses._Members of the
Council shall receive compensation for each day (including travel
time) engaged in carrying out the duties of the Council. Such
compensation may not be in an amount in excess of the maximum
rate of basic pay payable for level IV of the Executive Schedule
under section 5315 of title 5, United States Code.
__(i) Staff._The National Health Board shall provide to the
Council such staff, information, and other assistance as may be
necessary to carry out the duties of the Council.
__(j) Health Care Provider._For purposes of this subtitle, the
term ``health care provider'' means an individual who, or entity
that, provides an item or service to an individual that is
covered under the health plan (as defined in section 1400) in
which the individual is enrolled.
SEC. 5003. NATIONAL MEASURES OF QUALITY PERFORMANCE.
__(a) In General._The National Quality Management Council shall
develop a set of national measures of quality performance, which
shall be used to assess the provision of health care services and
access to such services.
__(b) Subject of Measures._National measures of quality
performance shall be selected in a manner that provides
information on the following subjects:
__(1) Access to health care services by consumers.
__(2) Appropriateness of health care services provided to
consumers.
__(3) Outcomes of health care services and procedures.
__(4) Health promotion.
__(5) Prevention of diseases, disorders, and other health
conditions.
__(6) Consumer satisfaction with care.
__(c) Selection of Measures._
__(1) Consultation._In developing and selecting the national
measures of quality performance, the National Quality Management
Council shall consult with appropriate interested parties,
including_
__(A) States;
__(B) health plans;
__(C) employers and individuals purchasing health care through
regional and corporate alliances;
__(D) health care providers;
__(E) the National Quality Consortium established under section
5009;
__(F) individuals distinguished in the fields of law, medicine,
economics, public health, and health services research;
__(G) the Administrator for Health Care Policy and Research;
__(H) the Director of the National Institutes of Health; and
__(I) the Administrator of the Health Care Financing
Administration.
__(2) Criteria._The following criteria shall be used in
developing and selecting national measures of quality
performance:
__(A) Significance._When a measure relates to a specific disease,
disorder, or other health condition, the disease, disorder, or
condition shall be of significance in terms of prevalence,
morbidity, mortality, or the costs associated with the
prevention, diagnosis, treatment, or clinical management of the
disease, disorder, or condition.
__(B) Range of services._The set of measures, taken as a whole,
shall be representative of the range of services provided to
consumers of health care by the individuals and entities
described in subsection (a).
__(C) Reliability and validity._The measures shall be reliable
and valid.
__(D) Undue burden._The data needed to calculate the measures
shall be obtained without undue burden on the entity or
individual providing the data.
__(E) Variation._Performance with respect to measures that are
applicable to each category of individual or entity described in
subsection (a) shall be expected to vary widely among individuals
or entities in the category.
__(F) Linkage to health outcome._When a measure is a rate of a
process of care, the process shall be linked to a health outcome
based upon the best available scientific evidence.
__(G) Provider control and risk adjustment._When a measure is an
outcome of the provision of care, the outcome shall be within the
control of the provider and one with respect to which an adequate
risk adjustment can be made.
__(H) Public health._The measures may incorporate standards
identified by the Secretary of Health and Human Services for
meeting public health objectives.
__(d) Updating._The National Quality Management Council shall
review and update the set of national measures of quality
performance annually to reflect changing goals for quality
improvement. The Board shall establish and maintain a priority
list of performance measures that within a 5-year period it
intends to consider for inclusion within the set through the
updating process.
SEC. 5004. CONSUMER SURVEYS.
__(a) In General._The National Quality Management Council shall
conduct periodic surveys of health care consumers to gather
information concerning access to care, use of health services,
health outcomes, and patient satisfaction. The surveys shall
monitor consumer reaction to the implementation of this Act and
be designed to assess the impact of this Act on the general
population of the United States and potentially vulnerable
populations.
__(b) Survey Administration._The National Quality Management
Council shall develop and approve a standard design for the
surveys, which shall be administered by the Administrator for
Health Care Policy and Research on a plan-by-plan and
State-by-State basis. A State may add survey questions on quality
measures of local interest to surveys conducted in the State.
__(c) Sampling Strategies._The National Quality Management
Council shall develop sampling strategies that ensure that survey
samples adequately measure populations that are considered to be
at risk of receiving inadequate health care and may be difficult
to reach through consumer-sampling methods, including individuals
who_
__(1) fail to enroll in a health plan;
__(2) resign from a plan; or
__(3) are members of a vulnerable population.
SEC. 5005. EVALUATION AND REPORTING OF QUALITY PERFORMANCE.
__(a) National Goals._In subject matter areas with respect to
which the National Quality Management Council determines that
sufficient information and consensus exist, the Council will
recommend to the Board that it establish goals for performance by
health plans and health care providers on a subset of the set of
national measures of quality performance.
__(b) Impact of Reform._The National Quality Management Council
shall evaluate the impact of the implementation of this Act on
the quality of health care services in the United States and the
access of consumers to such services.
__(c) Performance Reports._
__(1) Alliance and health plan reports._Each health alliance
annually shall publish and make available to the public a
performance report outlining in a standard format the performance
of each health plan offered in the alliance on the set of
national measures of quality performance. The report shall
include the results of a smaller number of such measures for
health care providers who are members of provider networks of
such plans (as defined in section 1402(f)), if the available
information is statistically meaningful. The report also shall
include the results of consumer surveys described in section 5004
that were conducted in the alliance during the year that is the
subject of the report.
__(2) National quality reports._The National Quality Management
Council annually shall provide to the Congress and to each health
alliance a report that_
__(A) outlines in a standard format the performance of each
regional alliance, corporate alliance, and health plan;
__(B) discusses State-level and national trends relating to
health care quality; and
__(C) presents data for each health alliance from consumer
surveys described in section 5004 that were conducted during the
year that is the subject of the report.
SEC. 5006. DEVELOPMENT AND DISSEMINATION OF PRACTICE GUIDELINES.
__(a) Development of Guidelines._
__(1) In general._The National Quality Management Council shall
direct the Administrator for Health Care Policy and Research to
develop and periodically review and update clinically relevant
guidelines that may be used by health care providers to assist in
determining how diseases, disorders, and other health conditions
can most effectively and appropriately be prevented, diagnosed,
treated, and managed clinically.
__(2) Certain Requirements._Guidelines under paragraph (1) shall_
__(A) be based on the best available research and professional
judgment regarding the effectiveness and appropriateness of
health care services and procedures;
__(B) be presented in formats appropriate for use by health care
providers, medical educators, medical review organizations, and
consumers of health care;
__(C) include treatment-specific or condition-specific practice
guidelines for clinical treatments and conditions in forms
appropriate for use in clinical practice, for use in educational
programs, and for use in reviewing quality and appropriateness of
medical care;
__(D) include information on risks and benefits of alternative
strategies for prevention, diagnosis, treatment, and management
of a given disease, disorder, or other health condition;
__(E) include information on the costs of alternative strategies
for the prevention, diagnosis, treatment, and management of a
given disease, disorder, or other health condition, where cost
information is available and reliable; and
__(F) be developed in accordance with priorities that shall be
established by the National Quality Management Council based on
the research priorities that are established under section
5007(b) and the 5-year priority list of performance measures
described in section 5003(d).
__(3) Health service utilization protocols._The National Quality
Management Council shall establish standards and procedures for
evaluating the clinical appropriateness of protocols used to
manage health service utilization.
__(4) Use in medical malpractice liability pilot
program._Guidelines developed under this subsection may be used
by the Secretary of Health and Human Services in the pilot
program applying practice guidelines to medical malpractice
liability under section 5312.
__(b) Evaluation and Certification of Other Guidelines._
__(1) Methodology._The National Quality Management Council shall
direct the Administrator for Health Care Policy and Research to
develop and publish standards relating to methodologies for
developing the types of guidelines described in subsection
(a)(1).
__(2) Evaluation and certification._The National Quality
Management Council shall direct the Administrator for Health Care
Policy and Research to establish a procedure by which individuals
and entities may submit guidelines of the type described in
subsection (a)(1) to the Council for evaluation and certification
by the Council using the standards developed under paragraph (1).
__(3) Use in medical malpractice liability pilot
program._Guidelines certified under paragraph (2) may be used by
the Secretary of Health and Human Services in the pilot program
applying practice guidelines to medical malpractice liability
under section 5312.
__(c) Guideline Clearinghouse._The National Quality Management
Council shall direct the Administrator for Health Care Policy and
Research to establish and oversee a clearinghouse and
dissemination program for practice guidelines that are developed
or certified under this section.
__(d) Dissemination of information on ineffective treatments._The
National Quality Management Council shall disseminate information
documenting clinically ineffective treatments and procedures.
SEC. 5007. RESEARCH ON HEALTH CARE QUALITY.
__(a) Research Support._The National Quality Management Council
shall direct the Administrator for Health Care Policy and
Research to support research directly related to the 5-year
priority list of performance measures described in section
5003(d), including research with respect to_
__(1) outcomes of health care services and procedures;
__(2) effective and efficient dissemination of information,
standards, and guidelines;
__(3) methods of measuring quality and shared decisionmaking; and
__(4) design and organization of quality of care components of
automated health information systems.
__(b) Research Priorities._The National Quality Management
Council shall establish priorities for research with respect to
the quality, appropriateness, and effectiveness of health care
and make recommendations concerning research projects. In
establishing the priorities, the National Quality Management
Council shall emphasize research involving diseases, disorders,
and health conditions as to which_
__(1) there is the highest level of uncertainty concerning
treatment;
__(2) there is the widest variation in practice patterns;
__(3) the costs associated with prevention, diagnosis, treatment,
or clinical management are significant; and
__(4) the rate of incidence or prevalence is high for the
population as a whole or for particular subpopulations.
SEC. 5008. REGIONAL PROFESSIONAL FOUNDATIONS.
__(a) Establishment._The National Health Board shall establish
and oversee regional professional foundations to perform the
duties specified in subsection (c).
__(b) Structure and Membership._
__(1) In general._The National Quality Consortium established
under section 5009 shall oversee the establishment of regional
professional foundations, the membership requirements for each
foundation, and any other requirement for the internal operation
of each foundation.
__(2) Entities eligible for membership._Each regional
professional foundation shall include at least one academic
health center (as defined in section 3101(c)). The following
entities also shall be eligible to serve as members of the
regional professional foundation for the region in which the
entity is located:
__(A) Schools of public health (as defined in section 799 of the
Public Health Service Act).
__(B) Other schools and programs defined in such section.
__(C) Health plans.
__(D) Regional alliances.
__(E) Corporate alliances.
__(F) Health care providers.
__(c) Duties._A regional professional foundation shall carry out
the following duties for the region in which the foundation is
located (such region to be demarcated by the National Health
Board with the advice of the National Quality Consortium
established under section 5009):
__(1) Developing programs in lifetime learning for health
professionals (as defined in section 1112(c)(1)) to ensure the
delivery of quality health care.
__(2) Fostering collaboration among health plans and health care
providers to improve the quality of primary and specialized
health care.
__(3) Disseminating information about successful quality
improvement programs, practice guidelines, and research findings.
__(4) Disseminating information on innovative uses of health
professionals.
__(5) Developing innovative patient education systems that
enhance patient involvement in decisions relating their health
care.
__(6) Applying for and conducting research described in section
5007.
__(d) Programs in Lifetime Learning._The programs described in
subsection (c)(1) shall ensure that health professionals remain
abreast of new knowledge, acquire new skills, and adopt new roles
as technology and societal demands change.
SEC. 5009. NATIONAL QUALITY CONSORTIUM.
__(a) Establishment._The National Health Board shall establish a
consortium to be known as the National Quality Consortium.
__(b) Duties._The Consortium shall_
__(1) establish programs for continuing education for health
professionals;
__(2) advise the National Quality Management Council and the
Administrator for Health Care Policy and Research on research
priorities;
__(3) oversee the development of the regional professional
foundations established under section 5008;
__(4) advise the National Quality Management Council with respect
to the funding of proposals to establish such foundations;
__(5) consult with the National Quality Management Council
regarding the selection of national measures of quality
performance under section 5003(c); and
__(6) advise the National Health Board and the National Quality
Management Council with respect to any other duty of the Board or
the Council under this subtitle.
__(c) Membership._The Consortium shall be composed of 11 members
appointed by the National Health Board. The members of the
Consortium shall include_
__(1) 5 individuals representing the interests of academic health
centers; and
__(2) 6 other individuals representing the interests of one of
the following persons:
__(A) Schools of public health.
__(B) Other schools and programs defined in section 799 of the
Public Health Service Act (including medical schools, nursing
schools, and allied health professional schools).
__(d) Terms._
__(1) In general._Except as provided in paragraph (2), members of
the Consortium shall serve for a term of 3 years.
__(2) Staggered rotation._Of the members first appointed to the
Consortium under subsection (c), the National Health Board shall
appoint 4 members to serve for a term of 3 years, 3 members to
serve for a term of 2 years, and 4 members to serve for a term of
1 year.
__(e) Chair._The National Health Board shall designate an
individual to serve as the chair of the Consortium.
SEC. 5010. ELIMINATING CLIA REQUIREMENT FOR CERTIFICATE OF WAIVER
FOR SIMPLE LABORATORY EXAMINATIONS AND PROCEDURES.
__(a) In General._Section 353 of the Public Health Service Act
(42 U.S.C. 263a) is amended_
__(1) in subsection (b), by inserting before the period at the
end the following: ``or unless the laboratory is exempt from the
certificate requirement under subsection (d)(2)'';
__(2) by amending paragraph (2) of subsection (d) to read as
follows:
__``(2) Exemption from certificate requirement for laboratories
performing only simple examinations and procedures._A laboratory
which performs only laboratory examinations and procedures
described in paragraph (3) is not required to have in effect a
certificate under this section.''; and
__(3) by striking paragraph (4) of subsection (d).
__(b) Effective Date._The amendments made by this section shall
take effect on the first day of the first month beginning after
the date of the enactment of this Act.
SEC. 5012. ROLE OF ALLIANCES IN QUALITY ASSURANCE.
__Each regional alliance and each corporate alliance shall_
__(1) disseminate to consumers information related to quality and
access to aid in their selection of plans in accordance with
section 1325;
__(2) disseminate information on the quality of health plans and
health care providers contained in reports of the National
Quality Management Council section 5005(d);
__(3) ensure through negotiations with health plans that
performance and quality standards are continually improved; and
__(4) conduct educational programs in cooperation with regional
quality foundations to assist consumers in using quality and
other information in choosing health plans.
SEC. 5013. ROLE OF HEALTH PLANS IN QUALITY MANAGEMENT.
__Each health plan shall_
__(1) measure and disclose performance on quality measures used
by_
__(A) participating States in which the plan does business;
__(B) regional alliances and corporate alliances that offer the
plan; and
__(C) the National Quality Management Council;
__(2) furnish information required under subtitle B of this title
and provide such other reports and information on the quality of
care delivered by health care providers who are members of a
provider network of the plan (as defined in section 1402(f)) as
may be required under this Act; and
__(3) maintain quality management systems that_
__(A) use the national measures of quality performance developed
by the National Quality Management Council under section 5003;
and
__(B) measure the quality of health care furnished to enrollees
under the plan by all health care providers who are members of a
provider network of the plan.
Title V, Subtitle B
Subtitle B_Information Systems, Privacy, and Administrative
Simplification
PART 1_HEALTH INFORMATION SYSTEMS
SEC. 5101. ESTABLISHMENT OF HEALTH INFORMATION SYSTEM.
__(a) In General._Not later than 2 years after the date of the
enactment of this Act, the National Health Board shall develop
and implement a health information system by which the Board
shall collect, report, and regulate the collection and
dissemination of the health care information described in
subsection (e) pursuant to standards promulgated by the Board and
(if applicable) consistent with policies established as part of
the National Information Infrastructure Act of 1993.
__(b) Privacy._The health information system shall be developed
and implemented in a manner that is consistent with the privacy
and security standards established under section 5120.
__(c) Reduction in Administrative Costs._The health information
system shall be developed and implemented in a manner that is
consistent with the objectives of reducing wherever practicable
and appropriate_
__(1) the costs of providing and paying for health care;
__(2) the time, effort, and financial resources expended by
persons to provide information to States and the Federal
Government.
__(d) Uses of Information._The health care information described
in subsection (e) shall be collected and reported in a manner
that facilitates its use for the following purposes:
__(1) Health care planning, policy development, policy
evaluation, and research by Federal, State, and local governments
and regional and corporate alliances.
__(2) Establishing and monitoring payments for health services by
the Federal Government, States, regional alliances, and corporate
alliances.
__(3) Assessing and improving the quality of health care.
__(4) Measuring and optimizing access to health care.
__(5) Evaluating the cost of specific clinical or administrative
functions.
__(6) Supporting public health functions and objectives.
__(7) Improving the ability of health plans, health care
providers, and consumers to coordinate, improve, and make choices
about health care.
__(8) Managing and containing costs at the alliance and plan
levels.
__(e) Health Care Information._The health care information
referred to in subsection (a) shall include data on_
__(1) enrollment and disenrollment in health plans;
__(2) clinical encounters and other items and services provided
by health care providers;
__(3) administrative and financial transactions and activities of
participating States, regional alliances, corporate alliances,
health plans, health care providers, employers, and individuals
that are necessary to determine compliance with this Act or an
Act amended by this Act;
__(4) the characteristics of regional alliances, including the
number, and demographic characteristics of eligible individuals
residing in each alliance area;
__(5) the characteristics of corporate alliances, including the
number, and demographic characteristics of individuals who are
eligible to be enrolled in each corporate alliance health plan
and individuals with respect to whom a large employer has
exercised an option under section 1311 to make ineligible for
such enrollment;
__(6) terms of agreement between health plans and the health care
providers who are members of provider networks of the plans (as
defined in section 1402(f));
__(7) payment of benefits in cases in which benefits may be
payable under a health plan and any other insurance policy or
health program;
__(8) utilization management by health plans and health care
providers;
__(9) the information collected and reported by the Board or
disseminated by other individuals or entities as part of the
National Quality Management Program under subtitle A;
__(10) grievances filed against regional alliances, corporate
alliances, and health plans and the resolutions of such
grievances; and
__(11) any other fact that may be necessary to determine whether
a health plan or a health care provider has complied with a
Federal statute pertaining to fraud or misrepresentation in the
provision or purchasing of health care or in the submission of a
claim for benefits or payment under a health plan.
SEC. 5102. ADDITIONAL REQUIREMENTS FOR HEALTH INFORMATION SYSTEM.
__(a) Consultation._The health information system shall be
developed in consultation with_
__(1) Federal agencies that_
__(A) collect health care information;
__(B) oversee the collection of information or records management
by other Federal agencies;
__(C) directly provide health care services;
__(D) provide for payments for health care services; or
__(E) enforce a provision of this Act or any Act amended by this
Act;
__(2) the National Quality Management Council established under
section 5002;
__(3) participating States;
__(4) regional alliances and corporate alliances;
__(5) health plans;
__(6) representatives of health care providers;
__(7) representatives of employers;
__(8) representatives of consumers of health care;
__(9) experts in public health and health care information and
technology; and
__(10) representatives of organizations furnishing health care
supplies, services, and equipment.
__(b) Collection and Transmission Requirements._In establishing
standards under section 5101, the National Health Board shall
specify the form and manner in which individuals and entities are
required to collect or transmit health care information for or to
the Board. The Board also shall specify the frequency with which
individuals and entities are required to transmit such
information to the Board. Such specifications shall include, to
the extent practicable_
__(1) requirements for use of uniform paper forms containing
standard data elements, definitions, and instructions for
completion in cases where the collection or transmission of data
in electronic form is not specified by the Board;
__(2) requirements for use of uniform health data sets with
common definitions to standardize the collection and transmission
of data in electronic form;
__(3) uniform presentation requirements for data in electronic
form; and
__(4) electronic data interchange requirements for the exchange
of data among automated health information systems.
__(c) Preemption of State ``Pen & Quill'' Laws._A standard
established by the National Health Board relating to the form in
which medical or health plan records are required to be
maintained shall supercede any contrary provision of State law,
except where the Board determines that the provision is necessary
to prevent fraud and abuse, with respect to controlled
substances, or for other purposes.
SEC. 5103. ELECTRONIC DATA NETWORK.
__(a) In General._As part of the health information system, the
National Health Board shall oversee the establishment of an
electronic data network consisting of regional centers that
collect, compile, and transmit information.
__(b) Consultation._The electronic data network shall be
developed in consultation with_
__(1) Federal agencies that_
__(A) collect health care information;
__(B) oversee the collection of information or records management
by other Federal agencies;
__(C) directly provide health care services;
__(D) provide for payments for health care services; or
__(E) enforce a provision of this Act or any Act amended by this
Act;
__(2) the National Quality Management Council established under
section 5002;
__(3) participating States;
__(4) regional alliances and corporate alliances; and
__(5) health plans.
__(c) Demonstration Projects._The electronic data network shall
be tested prior to full implementation through the establishment
of demonstration projects.
__(d) Disclosure of Individually Identifiable Information._The
electronic data network may be used to disclose individually
identifiable health information (as defined in section 5123(3))
to any individual or entity only in accordance with the health
information system privacy standards promulgated by the National
Health Board under section 5120.
SEC. 5104. UNIQUE IDENTIFIER NUMBERS.
__(a) In General._As part of the health information system, the
Board shall establish a system to provide for a unique identifier
number for each_
__(1) eligible individual;
__(2) employer;
__(3) health plan; and
__(4) health care provider.
__(b) Impermissible Data Links._In establishing the system under
subsection (a), the National Health Board shall ensure that a
unique identifier number may not be used to connect individually
identifiable health information (as defined in section 5123(3))
that is collected as part of the health information system or
that otherwise may be accessed through the number with
individually identifiable information from any other source,
except in cases where the National Health Board determines that
such connection is necessary to carry out a duty imposed on any
individual or entity under this Act.
__(c) Permissible Uses of Identifier._The National Health Board
shall by regulation establish the purposes for which a unique
identifier number provided pursuant to this section may be used.
SEC. 5105. HEALTH SECURITY CARDS.
__(a) Permissible Uses of Card._A health security card that is
issued to an eligible individual under section 1001(b) may be
used by an individual or entity, in accordance with regulations
promulgated by the Board, only for the purpose of providing or
assisting the eligible individual in obtaining an item or service
that is covered under_
__(1) the applicable health plan in which the individual is
enrolled (as defined in section 1902);
__(2) a policy consisting of a supplemental health benefit policy
(described in part 2 of subtitle E of title I), a cost sharing
policy (described in such part), or both;
__(3) a FEHBP supplemental plan (described in subtitle C of title
VIII);
__(4) a FEHBP medicare supplemental plan (described in such
subtitle); or
__(5) such other programs as the Board may specify.
__(b) Form of Card and Encoded Information._The National Health
Board shall establish standards respecting the form of health
security cards and the information to be encoded in electronic
form on the cards. Such information shall include_
__(1) the identity of the individual to whom the card is issued;
__(2) the applicable health plan in which the individual is
enrolled;
__(3) any policy described in paragraph (2), (3), or (4) of
subsection (a) in which the individual is enrolled; and
__(4) any other information that the National Health Board
determines to be necessary in order for the card to serve the
purpose described in subsection (a).
__(c) Unique Identifier Numbers._The unique identifier number
system developed by the National Health Board under section 5104
shall be used in encoding the information described in subsection
(b).
__(d) Registration of Card._The Board shall take appropriate
steps to register the card, the name of the card, and other
indicia relating to the card as a trademark or service mark (as
appropriate) under the Trademark Act of 1946. For purposes of
this subsection, the ``Trademark Act of 1946'' refers to the Act
entitled ``An Act to provide for the registration and protection
of trademarks used in commerce, to carry out the provisions of
international conventions, and for other purposes'', approved
July 5, 1946 (15 U.S.C. et seq.).
__(e) Reference to Crime._For a provision relating to criminal
penalties for misuse of a health security card or a unique
identifier number, see section 5438.
SEC. 5106. TECHNICAL ASSISTANCE IN THE ESTABLISHMENT OF HEALTH
INFORMATION SYSTEMS.
__The National Health Board shall provide information and
technical assistance to participating States, regional alliances,
corporate alliances,  health plans, and health care providers
with respect to the establishment and operation of automated
health information systems. Such assistance shall focus on_
__(1) the promotion of community-based health information
systems; and
__(2) the promotion of patient care information systems that
collect data at the point of care or as a by-product of the
delivery of care.
PART 2_PRIVACY OF INFORMATION
SEC. 5120. HEALTH INFORMATION SYSTEM PRIVACY STANDARDS.
__(a) Health Information System Standards._Not later than 2 years
after the date of the enactment of this Act, the National Health
Board shall promulgate standards respecting the privacy of
individually identifiable health information that is in the
health information system described in part 1 of this subtitle.
Such standards shall include standards concerning safeguards for
the security of such information. The Board shall develop and
periodically revise the standards in consultation with_
__(1) Federal agencies that_
__(A) collect health care information;
__(B) oversee the collection of information or records management
by other Federal agencies;
__(C) directly provide health care services;
__(D) provide for payments for health care services; or
__(E) enforce a provision of this Act or any Act amended by this
Act;
__(2) the National Quality Management Council established under
section 5002;
__(3) participating States;
__(4) regional alliances and corporate alliances;
__(5) health plans; and
__(6) representatives of consumers of health care.
__(b) Information Covered._The standards established under
subsection (a) shall apply to individually identifiable health
information collected for or by, reported to or by, or the
dissemination of which is regulated by, the National Health Board
under section 5101.
__(c) Principles._The standards established under subsection (a)
shall incorporate the following principles:
__(1) Unauthorized Disclosure._All disclosures of individually
identifiable health information by an individual or entity shall
be unauthorized unless_
__(A) the disclosure is by the enrollee identified in the
information or whose identity can be associated with the
information;
__(B) the disclosure is authorized by such enrollee in writing in
a manner prescribed by the Board;
__(C) the disclosure is to Federal, State, or local law
enforcement agencies for the purpose of enforcing this Act or an
Act amended by this Act; or
__(D) the disclosure otherwise is consistent with this Act and
specific criteria governing disclosure established by the Board.
__(2) Minimal disclosure._All disclosures of individually
identifiable health information shall be restricted to the
minimum amount of information necessary to accomplish the purpose
for which the information is being disclosed.
__(3) Risk adjustment._No individually identifiable health
information may be provided by a health plan to a regional
alliance or a corporate alliance for the purpose of setting
premiums based on risk adjustment factors.
__(4) Required safeguards._Any individual or entity who
maintains, uses, or disseminates individually identifiable health
information shall implement administrative, technical, and
physical safeguards for the security of such information.
__(5) Right to know._An enrollee (or an enrollee representative
of the enrollee) has the right to know_
__(A) whether any individual or entity uses or maintains
individually identifiable health information concerning the
enrollee; and
__(B) for what purposes the information may be used or
maintained.
__(6) Right to access._Subject to appropriate procedures, an
enrollee (or an enrollee representative of the enrollee) has the
right, with respect to individually identifiable health
information concerning the enrollee that is recorded in any form
or medium_
__(A) to see such information;
__(B) to copy such information; and
__(C) to have a notation made with or in such information of any
amendment or correction of such information requested by the
enrollee or enrollee representative.
__(7) Right to notice._An enrollee and an enrollee representative
have the right to receive a written statement concerning_
__(A) the purposes for which individually identifiable health
information provided to a health care provider, a health plan, a
regional alliance, a corporate alliance, or the National Health
Board may be used or disclosed by, or disclosed to, any
individual or entity; and
__(B) the right of access described in paragraph (6).
__(8) Use of Unique Identifier._When individually identifiable
health information concerning an enrollee is required to
accomplish the purpose for which information is being transmitted
between or among the National Health Board, regional and
corporate alliances, health plans, and health care providers, the
transmissions shall use the unique identifier number provided to
the enrollee pursuant to section 5104 in lieu of the name of the
enrollee.
__(9) Use for Employment Decisions._Individually identifiable
health care information may not be used in making employment
decisions.
SEC. 5121. OTHER DUTIES WITH RESPECT TO PRIVACY.
__(a) Research and Technical Support._The National Health Board
may sponsor_
__(1) research relating to the privacy and security of
individually identifiable health information;
__(2) the development of consent forms governing disclosure of
such information; and
__(3) the development of technology to implement standards
regarding such information.
__(c) Education._The National Health Board shall establish
education and awareness programs_
__(1) to foster adequate security practices by States, regional
alliances, corporate alliances, health plans, and health care
providers;
__(2) to train personnel of public and private entities who have
access to individually identifiable health information respecting
the duties of such personnel with respect to such information;
and
__(3) to inform individuals and employers who purchase health
care respecting their rights with respect to such information.
SEC. 5122. COMPREHENSIVE HEALTH INFORMATION PRIVACY PROTECTION
ACT.
__(a) In General._Not later than 3 years after the date of the
enactment of this Act, the National Health Board shall submit to
the President and the Congress a detailed proposal for
legislation to provide a comprehensive scheme of Federal privacy
protection for individually identifiable health information.
__(b) Code of Fair Information Practices._The proposal shall
include a Code of Fair Information Practices to be used to advise
enrollees to whom individually identifiable health information
pertains of their rights with respect to such information in an
easily understood and useful form.
__(c) Enforcement._The proposal shall include provisions to
enforce effectively the rights and duties that would be created
by the legislation.
SEC. 5123. DEFINITIONS.
__For purposes of this part:
__(1) Enrollee._The term ``enrollee'' means an individual who
enrolls or has enrolled under a health plan. The term includes a
deceased individual who was enrolled under a health plan.
__(2) Enrollee representative._The term ``enrollee
representative'' means any individual legally empowered to make
decisions concerning the provision of health care to an enrollee
or the administrator or executor of the estate of a deceased
enrollee.
__(3) Individually identifiable health information._The term
``individually identifiable health information'' means any
information, whether oral or recorded in any form or medium,
that_
__(A) identifies or can readily be associated with the identity
of an enrollee; and
__(B) relates to_
__(i) the past, present, or future physical or mental health of
the enrollee;
__(ii) the provision of health care to the enrollee; or
__(iii) payment for the provision of health care to the enrollee.
PART 3_INTERIM REQUIREMENTS FOR ADMINISTRATIVE SIMPLIFICATION
SEC. 5130. STANDARD BENEFIT FORMS.
__(a) Development._Not later than 1 year after the date of the
enactment of this Act, the National Health Board shall develop,
promulgate, and publish in the Federal Register the following
standard health care benefit forms:
__(1) An enrollment and disenrollment form to be used to record
enrollment and disenrollment in a health benefit plan.
__(2) A clinical encounter record to be used by health benefit
plans and health service providers.
__(3) A claim form to be used in the submission of claims for
benefits or payment under a health benefit plan.
__(b) Instructions, Definitions, and Codes._Each standard form
developed under subsection (a) shall include instructions for
completing the form that_
__(1) specifically define, to the extent practicable, the data
elements contained in the form; and
__(2) standardize any codes or data sets to be used in completing
the form.
__(c) Requirements for Adoption of Forms._
__(1) Health Service Providers._On or after the date that is 270
days after the publication of the standard forms developed under
subsection (a), a health service provider that furnishes items or
services in the United States for which payment may be made under
a health benefit plan may not_
__(A) maintain records of clinical encounters involving such
items or services that are required to be maintained by the
National Health Board in a paper form that is not the clinical
encounter record promulgated by the Board; or
__(B) submit any claim for benefits or payment for such services
to such plan in a paper form that is not the claim form
promulgated by the National Health Board.
__(2) Health Benefit Plans._On or after the date that is 270 days
after the publication of the standard forms developed under
subsection (a), a health benefit plan may not_
__(A) record enrollment and disenrollment in a paper form that is
not the enrollment and disenrollment form promulgated by the
National Health Board;
__(B) maintain records of clinical encounters that are required
to be maintained by the National Health Board in a paper form
that is not the clinical encounter record promulgated by the
Board; or
__(C) reject a claim for benefits or payment under the plan on
the basis of the form or manner in which the claim is submitted
if_
__(i) the claim is submitted on the claim form promulgated by the
National Health Board; and
__(ii) the plan accepts claims submitted in paper form.
__(d) Definitions._For purposes of this subtitle:
__(1) Health Benefit Plan._
__(A) In general._The term ``health benefit plan'' means, except
as provided in subparagraphs (B) through (D), any public or
private entity or program that provides for payments for health
care services, including_
__(i) a group health plan (as defined in section 5000(b)(1) of
the Internal Revenue Code of 1986); and
__(ii) any other health insurance arrangement, including any
arrangement consisting of a hospital or medical expense incurred
policy or certificate, hospital or medical service plan contract,
or health maintenance organization subscriber contract.
__(B) Plans excluded._Such term does not include_
__(i) accident-only, credit, or disability income insurance;
__(ii) coverage issued as a supplement to liability insurance;
__(iii) an individual making payment on the individual's own
behalf (or on behalf of a relative or other individual) for
deductibles, coinsurance, or services not covered under a health
benefit plan; and
__(iv) such other plans as the National Health Board may
determine, because of the limitation of benefits to a single type
or kind of health care, such as dental services or hospital
indemnity plans, or other reasons should not be subject to the
requirements of this section.
__(C) Plans included._Such term includes_
__(i) workers compensation or similar insurance insofar as it
relates to workers compensation medical benefits (as defined in
section 10000(3)) provided by or through health plans; and
__(ii) automobile medical insurance insofar as it relates to
automobile insurance medical benefits (as defined in section
10100(2)) provided by or through health plans.
__(D) Treatment of direct provision of services._Such term does
not include a Federal or State program that provides directly for
the provision of health services to beneficiaries.
__(2) Health service provider._The term ``health service
provider'' includes a provider of services (as defined in section
1861(u) of the Social Security Act), physician, supplier, and
other person furnishing health care services. Such term includes
a Federal or State program that provides directly for the
provision of health services to beneficiaries.
__(e) Interim Nature of Requirements._The National Health Board
may modify, update, or supercede any standard form or requirement
developed, promulgated, or imposed under this section through the
establishment of a standard under section 5101.
PART 4_GENERAL PROVISIONS
SEC. 5140. NATIONAL PRIVACY AND HEALTH DATA ADVISORY COUNCIL.
__(a) Establishment._There is established an advisory council to
be known as the National Privacy and Health Data Advisory
Council.
__(b) Duties._The Council shall advise the National Health Board
with respect its duties under this subtitle.
__(c) Number and Appointment._The Council shall be composed of 15
members appointed by the National Health Board. The members of
the Council shall include_
__(1) individuals representing the interests of consumers,
employers, and other purchasers of health care;
__(2) individuals representing the interests of health plans,
health care providers, corporate alliances, regional alliances,
public health agencies, and participating States; and
__(3) individuals distinguished in the fields of data collection,
data protection and privacy, law, ethics, medical and health
services research, public health, and civil liberties and patient
advocacy.
__(d) Terms._
__(1) In general._Except as provided in paragraph (2), members of
the Council shall serve for a term of 3 years.
__(2) Staggered rotation._Of the members first appointed to the
Council under subsection (c), the National Health Board shall
appoint 5 members to serve for a term of 3 years, 5 members to
serve for a term of 2 years, and 5 members to serve for a term of
1 year.
__(3) Service beyond term._A member of the Council may continue
to serve after the expiration of the term of the member until a
successor is appointed.
__(e) Vacancies._If a member of the Council does not serve the
full term applicable under subsection (d), the individual
appointed to fill the resulting vacancy shall be appointed for
the remainder of the term of the predecessor of the individual.
__(f) Chair._The National Health Board shall designate an
individual to serve as the chair of the Council.
__(g) Meetings._The Council shall meet not less than once during
each discrete 4-month period and shall otherwise meet at the call
of the National Health Board or the chair.
__(h) Compensation and Reimbursement of Expenses._Members of the
Council shall receive compensation for each day (including travel
time) engaged in carrying out the duties of the Council. Such
compensation may not be in an amount in excess of the maximum
rate of basic pay payable for level IV of the Executive Schedule
under section 5315 of title 5, United States Code.
__(i) Staff._The National Health Board shall provide to the
Council such staff, information, and other assistance as may be
necessary to carry out the duties of the Council.
__(j) Duration._Notwithstanding section 14(a) of the Federal
Advisory Committee Act, the Council shall continue in existence
until otherwise provided by law.
SEC. 5141. CIVIL MONEY PENALTIES.
__(a) Violation of Health Information System Standards._Any
person who the Secretary of Health and Human Services determines_
__(1) is required, but has substantially failed, to comply with a
standard established by the National Health Board under section
5101 or 5120;
__(2) has required the display of, has required the use of, or
has used a health security card for any purpose other than a
purpose described in section 5105(a); or
__(3) has required the disclosure of, has required the use of, or
has used a unique identifier number provided pursuant to section
5104 for any purpose that is not authorized by the National
Health Board pursuant to such section
shall be subject, in addition to any other penalties that may be
prescribed by law, to a civil money penalty of not more than
$10,000 for each such violation.
__(b) Standard Benefit Forms._Any health service provider or
health benefit plan that the Secretary of Health and Human
Services determines is required, but has substantially failed, to
comply with section 5130(c) shall be subject, in addition to any
other penalties that may be prescribed by law, to a civil money
penalty of not more than $10,000 for each such violation.
__(c) Process._The process for the imposition of a civil money
penalty under the All-Payer Health Care Fraud and Abuse Control
Program under part 1 of subtitle E of this title shall apply to a
civil money penalty under this section in the same manner as such
process applies to a penalty or proceeding under such program.
SEC. 5142. RELATIONSHIP TO OTHER LAWS.
__(a) Court Orders._Nothing in this title shall be construed to
invalidate or limit the power or authority of any court of
competent jurisdiction with respect to health care information.
__(b) Public Health Reporting._Nothing in this title shall be
construed to invalidate or limit the authorities, powers, or
procedures established under any law that provides for the
reporting of disease, child abuse, birth, or death.
Title V, Subtitle C
Subtitle C_Remedies and Enforcement
PART 1_REVIEW OF BENEFIT DETERMINATIONS FOR ENROLLED INDIVIDUALS
Subpart A_General Rules
SEC. 5201. HEALTH PLAN CLAIMS PROCEDURE.
__(a) Definitions._For purposes of this section_
__(1) Claim._The term ``claim'' means a claim for payment or
provision of benefits under a health plan or a request for
preauthorization of items or services which is submitted to a
health plan prior to receipt of the items or services.
__(2) Individual claimant._The term ``individual claimant'' with
respect to a claim means any individual who submits the claim to
a health plan in connection with the individual's enrollment
under the plan, or on whose behalf the claim is submitted to the
plan by a provider.
__(3) Provider claimant._The term ``provider claimant'' with
respect to a claim means any provider who submits the claim to a
health plan with respect to items or services provided to an
individual enrolled under the plan.
__(b) General Rules Governing Treatment of Claims._
__(1) Adequate notice of disposition of claim._In any case in
which a claim is submitted in complete form to a health plan, the
plan shall provide to the individual claimant and any provider
claimant with respect to the claim a written notice of the plan's
approval or denial of the claim within 30 days after the date of
the submission of the claim. The notice to the individual
claimant shall be written in language calculated to be understood
by the typical individual enrolled under the plan and in a form
which takes into account accessibility to the information by
individuals whose primary language is not English. In the case of
a denial of the claim, the notice shall be provided within 5 days
after the date of the determination to deny the claim, and shall
set forth the specific reasons for the denial. The notice of a
denial shall include notice of the right to appeal the denial
under paragraph (2). Failure by any plan to comply with the
requirements of this paragraph with respect to any claim
submitted to the plan shall be treated as approval by the plan of
the claim.
__(2) Plan's duty to review denials upon timely request._The plan
shall review its denial of the claim if an individual claimant or
provider claimant with respect to the claim submits to the plan a
written request for reconsideration of the claim after receipt of
written notice from the plan of the denial. The plan shall allow
any such claimant not less than 60 days, after receipt of written
notice from the plan of the denial, to submit the claimant's
request for reconsideration of the claim.
__(3) Time limit for review._The plan shall complete any review
required under paragraph (2), and shall provide the individual
claimant and any provider claimant with respect to the claim
written notice of the plan's decision on the claim after
reconsideration pursuant to the review, within 30 days after the
date of the receipt of the request for reconsideration.
__(4) De novo reviews._Any review required under paragraph (2)_
__(A) shall be de novo,
__(B) shall be conducted by an individual who did not make the
initial decision denying the claim and who is authorized to
approve the claim, and
__(C) shall include review by a qualified physician if the
resolution of any issues involved requires medical expertise.
__(c) Treatment of Urgent Requests to Plans for
Preauthorization._
__(1) In general._This subsection applies in the case of any
claim submitted by an individual claimant or a provider claimant
consisting of a request for preauthorization of items or services
which is accompanied by an attestation that_
__(A) failure to immediately provide the items or services could
reasonably be expected to result in_
__(i) placing the health of the individual claimant (or, with
respect to an individual claimant who is a pregnant woman, the
health of the woman or her unborn child) in serious jeopardy,
__(ii) serious impairment to bodily functions, or
__(iii) serious dysfunction of any bodily organ or part,
or
__(B) immediate provision of the items or services is necessary
because the individual claimant has made or is at serious risk of
making an attempt to harm such individual claimant or another
individual.
__(2) Shortened time limit for consideration of requests for
preauthorization._Notwithstanding subsection (b)(1), a health
plan shall approve or deny any claim described in paragraph (1)
within 24 hours after submission of the claim to the plan.
Failure by the plan to comply with the requirements of this
paragraph with respect to the claim shall be treated as approval
by the plan of the claim.
__(3) Expedited exhaustion of plan remedies._Any claim described
in paragraph (1) which is denied by the plan shall be treated as
a claim with respect to which all remedies under the plan
provided pursuant to this section are exhausted, irrespective of
any review provided under subsection (b)(2).
__(4) Denial of previously authorized claims not permitted._In
any case in which a health plan approves a claim described in
paragraph (1)_
__(A) the plan may not subsequently deny payment or provision of
benefits pursuant to the claim, unless the plan makes a showing
of an intentional misrepresentation of a material fact by the
individual claimant, and
__(B) in the case of a violation of subparagraph (A) in
connection with the claim, all remedies under the plan provided
pursuant to this section with respect to the claim shall be
treated as exhausted.
__(d) Time Limit for Determination of Incompleteness of
Claim._For purposes of this section_
__(1) any claim submitted by an individual claimant and accepted
by a provider serving under contract with a health plan and any
claim described in subsection (b)(1) shall be treated with
respect to the individual claimant as submitted in complete form,
and
__(2) any other claim for benefits under the plan shall be
treated as filed in complete form as of 10 days after the date of
the submission of the claim, unless the plan provides to the
individual claimant and any provider claimant, within such
period, a written notice of any required matter remaining to be
filed in order to complete the claim.
Any filing by the individual claimant or the provider claimant of
additional matter requested by the plan pursuant to paragraph (2)
shall be treated for purposes of this section as an initial
filing of the claim.
__(e) Additional Notice and Disclosure Requirements for Health
Plans._In the case of a denial of a claim for benefits under a
health plan, the plan shall include, together with the specific
reasons provided to the individual claimant and any provider
claimant under subsection (b)(1)_
__(1) if the denial is based in whole or in part on a
determination that the claim is for an item or service which is
not covered by the comprehensive benefit package or exceeds
payment rates under the applicable alliance or State fee
schedule, the factual basis for the determination,
__(2) if the denial is based in whole or in part on exclusion of
coverage with respect to services because the services are
determined to comprise an experimental treatment or investigatory
procedure, the medical basis for the determination and a
description of the process used in making the determination, and
__(3) if the denial is based in whole or in part on a
determination that the treatment is not medically necessary or
appropriate or is inconsistent with the plan's practice
guidelines, the medical basis for the determination, the
guidelines used in making the determination, and a description of
the process used in making the determination.
__(f) Waiver of Rights Prohibited._A health plan may not require
any party to waive any right under the plan or this Act as a
condition for approval of any claim under the plan, except to the
extent otherwise specified in a formal settlement agreement.
SEC. 5202. REVIEW IN REGIONAL ALLIANCE COMPLAINT REVIEW OFFICES
OF GRIEVANCES BASED ON ACTS OR PRACTICES BY HEALTH PLANS.
__(a) Complaint Review Offices._
__(1) In general._In accordance with rules which shall be
prescribed by the Secretary of Labor, each State shall establish
and maintain a complaint review office for each regional alliance
established by such State. According to designations which shall
be made by each State under regulations of the Secretary of
Labor, the complaint review office for a regional alliance
established by such State shall also serve as the complaint
review office for corporate alliances operating in the State with
respect to individuals who are enrolled under corporate alliance
health plans maintained by such corporate alliances and who
reside within the area of the regional alliance.
__(2) Regional alliances not established by States._In the case
of any regional alliance established in any State by the
Secretary of Health and Human Services, the Secretary of Health
and Human Services shall assume all duties and obligations of
such State under this part in accordance with the applicable
regulations of the Secretary of Labor under this part.
__(b) Filings of Complaints by Aggrieved Persons._In the case of
any person who is aggrieved by_
__(1) any act or practice engaged in by any health plan which
consists of or results in denial of payment or provision of
benefits under the plan or delay in the payment or provision of
benefits, or
__(2) any act or practice engaged in by any other plan maintained
by a regional alliance or a corporate alliance which consists of
or results in denial of payment or provision of benefits under a
cost sharing policy described in section 1421(b)(2) or delay in
the payment or provision of the benefits,
if the denial or delay consists of a failure to comply with the
terms of the plan (including the provision of benefits in full
when due in accordance with the terms of the plan), or with the
applicable requirements of this Act, such person may file a
complaint with the appropriate complaint review office.
__(c) Exhaustion of Plan Remedies._Any complaint including a
claim to which section 5201 applies may not be filed until the
complainant has exhausted all remedies provided under the plan
with respect to the claim in accordance with such section.
__(d) Exclusive Means of Review for Plans Maintained by Corporate
Alliances._Proceedings under sections 5203 and 5204 pursuant to
complaints filed under subsection (b), and review under section
5205 of determinations made under section 5204, shall be the
exclusive means of review of acts or practices described in
subsection (b) which are engaged in by a corporate alliance
health plan or by any plan maintained by a corporate alliance
with respect to benefits under a cost sharing policy described in
section 1421(b)(2).
__(e) Form of Complaint._The complaint shall be in writing under
oath or affirmation, shall set forth the complaint in a manner
calculated to give notice of the nature of the complaint, and
shall contain such information as may be prescribed in
regulations of the Secretary of Labor.
__(f) Notice of Filing._The complaint review office shall serve
by certified mail a notice of the complaint (including the date,
place, and circumstances of the alleged violation) on the person
or persons alleged in the complaint to have committed the
violation within 10 days after the filing of the complaint.
__(g) Time Limitation._Complaints may not be brought under this
section with respect to any violation later than one year after
the date on which the violation occurs. This subsection shall not
prevent the subsequent amending of a complaint.
SEC. 5203. INITIAL PROCEEDINGS IN COMPLAINT REVIEW OFFICES.
__(a) Elections._Whenever a complaint is brought to the complaint
review office under section 5202(b), the complaint review office
shall provide the complainant with an opportunity, in such form
and manner as shall be prescribed in regulations of the Secretary
of Labor, to elect one of the following:
__(1) to forego further proceedings in the complaint review
office and rely on remedies available in a court of competent
jurisdiction, except with respect to any matter in the complaint
with respect to which proceedings under this section and section
5204, and review under section 5205, are not under section
5202(d) the exclusive means of review,
__(2) to submit the complaint as a dispute under the Early
Resolution Program established under subpart B and thereby
suspend further review proceedings under this section pending
termination of proceedings under the Program, or
__(3) in any case in which an election under paragraph (2) is not
made, or such an election was made but resolution of all matters
in the complaint was not obtained upon termination of proceedings
pursuant to the election by settlement agreement or otherwise, to
proceed with the complaint to a hearing in the complaint review
office under section 5204 regarding the unresolved matters.
__(b) Effect of Participation in Early Resolution Program._Any
matter in a complaint brought to the complaint review office
which is included in a dispute which is timely submitted to the
Early Resolution Program established under subpart B shall not be
assigned to a hearing under this section unless the proceedings
under the Program with respect to the dispute are terminated
without settlement or resolution of the dispute with respect to
such matter. Upon termination of any proceedings regarding a
dispute submitted to the Program, the applicability of this
section to any matter in a complaint which was included in the
dispute shall not be affected by participation in the
proceedings, except to the extent otherwise required under the
terms of any settlement agreement or other formal resolution
obtained in the proceedings.
SEC. 5204. HEARINGS BEFORE HEARING OFFICERS IN COMPLAINT REVIEW
OFFICES.
__(a) Hearing Process._
__(1) Assignment of complaints to hearing officers and notice to
parties._
__(A) In general._In the case of an election under section
5203(a)(3)_
__(i) the complaint review office shall assign the complaint, and
each motion in connection with the complaint, to a hearing
officer employed by the State in the office; and
__(ii) the hearing officer shall have the power to issue and
cause to be served upon the plan named in the complaint a copy of
the complaint and a notice of hearing before the hearing officer
at a place fixed in the notice, not less than 5 days after the
serving of the complaint.
__(B) Qualifications for hearing officers._No individual may
serve in a complaint review office as a hearing officer unless
the individual meets standards which shall be prescribed by the
Secretary of Labor. Such standards shall include experience,
training, affiliations, diligence, actual or potential conflicts
of interest, and other qualifications deemed relevant by the
Secretary of Labor. At no time shall a hearing officer have any
official, financial, or personal conflict of interest with
respect to issues in controversy before the hearing officer.
__(2) Amendment of complaints._Any such complaint may be amended
by the hearing officer conducting the hearing, upon the motion of
the complainant, in the hearing officer's discretion at any time
prior to the issuance of an order based thereon.
__(3) Answers._The party against whom the complaint is filed
shall have the right to file an answer to the original or amended
complaint and to appear in person or otherwise and give testimony
at the place and time fixed in the complaint.
__(b) Additional Parties._In the discretion of the hearing
officer conducting the hearing, any other person may be allowed
to intervene in the proceeding and to present testimony.
__(c) Hearings._
__(1) De novo hearing._Each hearing officer shall hear complaints
and motions de novo.
__(2) Testimony._The testimony taken by the hearing officer shall
be reduced to writing. Thereafter, the hearing officer, in his or
her discretion, upon notice may provide for the taking of further
testimony or hear argument.
__(3) Authority of hearing officers._The hearing officer may
compel by subpoena the attendance of witnesses and the production
of evidence at any designated place or hearing. In case of
contumacy or refusal to obey a subpoena lawfully issued under
this paragraph and upon application of the hearing officer, an
appropriate district court may issue an order requiring
compliance with the subpoena and any failure to obey the order
may be punished by the court as a contempt thereof. The hearing
officer may also seek enforcement of the subpoena in a State
court of competent jurisdiction.
__(4) Expedited hearings._Notwithstanding section 5203 and the
preceding provisions of this section, upon receipt of a complaint
containing a claim described in section 5201(c)(1), the complaint
review office shall promptly provide the complainant with the
opportunity to make an election under section 5203(a)(3) and
assignment to a hearing on the complaint before a hearing
officer. The complaint review office shall ensure that such a
hearing commences not later than 24 hours after receipt of the
complaint by the complaint hearing office.
__(d) Decision of Hearing Officer._
__(1) In general._The hearing officer shall decide upon the
preponderance of the evidence whether to decide in favor of the
complainant with respect to each alleged act or practice. Each
such decision_
__(A) shall include the hearing officer's findings of fact, and
__(B) shall constitute the hearing officer's final disposition of
the proceedings.
__(2) Decisions finding in favor of complainant._
__(A) In general._If the hearing officer's decision includes a
determination that any party named in the complaint has engaged
in or is engaged in an act or practice described in section
5202(b), the hearing officer shall issue and cause to be served
on such party an order which requires such party_
__(i) to cease and desist from such act or practice,
__(ii) to provide the benefits due under the terms of the plan
and to otherwise comply with the terms of the plan and the
applicable requirements of this Act,
__(iii) to pay to the complainant prejudgment interest on the
actual costs incurred in obtaining the items and services at
issue in the complaint, and
__(iv) to pay to the prevailing complainant a reasonable
attorney's fee, reasonable expert witness fees, and other
reasonable costs relating to the hearing on the charges on which
the complainant prevails.
__(3) Decisions not in favor of complainant._If the hearing
officer's decision includes a determination that the party named
in the complaint has not engaged in or is not engaged in an act
or practice referred to in section 5202(b), the hearing officer_
__(A) shall include in the decision a dismissal of the charge in
the complaint relating to the act or practice, and
__(B) upon a finding that such charge is frivolous, shall issue
and cause to be served on the complainant an order which requires
the complainant to pay to such party a reasonable attorney's fee,
reasonable expert witness fees, and other reasonable costs
relating to the proceedings on such charge.
__(4) Submission and service of decisions._The hearing officer
shall submit each decision to the complaint review office at the
conclusion of the proceedings and the office shall cause a copy
of the decision to be served on the parties to the proceedings.
__(e) Review._
__(1) In general._The decision of the hearing officer shall be
final and binding upon all parties. Except as provided in
paragraph (2), any party to the complaint may, within 30 days
after service of the decision by the complaint review office,
file an appeal of the decision with the Federal Health Plan
Review Board under section 5205 in such form and manner as may be
prescribed by such Board.
__(2) Exception._The decision in the case of an expedited hearing
under subsection (c)(4) shall not be subject to review.
__(f) Court Enforcement of Orders._
__(1) In general._If a decision of the hearing officer in favor
of the complainant is not appealed under section 5205, the
complainant may petition any court of competent jurisdiction for
enforcement of the order. In any such proceeding, the order of
the hearing officer shall not be subject to review.
__(2) Awarding of costs._In any action for court enforcement
under this subsection, a prevailing complainant shall be entitled
to a reasonable attorney's fee, reasonable expert witness fees,
and other reasonable costs relating to such action.
SEC. 5205. REVIEW BY FEDERAL HEALTH PLAN REVIEW BOARD.
__(a) Establishment and Membership._The Secretary of Labor shall
establish by regulation a Federal Health Plan Review Board
(hereinafter in this subtitle referred to as the ``Review
Board''). The Review Board shall be composed of 5 members
appointed by the Secretary of Labor from among persons who by
reason of training, education, or experience are qualified to
carry out the functions of the Review Board under this subtitle.
The Secretary of Labor shall prescribe such rules as are
necessary for the orderly transaction of proceedings by the
Review Board. Every official act of the Review Board shall be
entered of record, and its hearings and records shall be open to
the public.
__(b) Review Process._The Review Board shall ensure, in
accordance with rules prescribed by the Secretary of Labor, that
reasonable notice is provided for each appeal before the Review
Board of a hearing officer's decision under section 5304, and
shall provide for the orderly consideration of arguments by any
party to the hearing upon which the hearing officer's decision is
based. In the discretion of the Review Board, any other person
may be allowed to intervene in the proceeding and to present
written argument. The National Health Board may intervene in the
proceeding as a matter of right.
__(c) Scope of Review._The Review Board shall review the decision
of the hearing officer from which the appeal is made, except that
the review shall be only for the purposes of determining_
__(1) whether the determination is supported by substantial
evidence on the record considered as a whole,
__(2) in the case of any interpretation by the hearing officer of
contractual terms (irrespective of the extent to which extrinsic
evidence was considered), whether the determination is supported
by a preponderance of the evidence,
__(3) whether the determination is in excess of statutory
jurisdiction, authority, or limitations, or in violation of a
statutory right, or
__(4) whether the determination is without observance of
procedure required by law.
__(d) Decision of Review Board._The decision of the hearing
officer as affirmed or modified by the Review Board (or any
reversal by the Review Board of the hearing officer's final
disposition of the proceedings) shall become the final order of
the Review Board and binding on all parties, subject to review
under subsection (e). The Review Board shall cause a copy of its
decision to be served on the parties to the proceedings not later
than 5 days after the date of the proceeding.
__(e) Review of Final Orders._
__(1) In general._Not later than 60 days after the entry of the
final order, any person aggrieved by any such final order under
which the amount or value in controversy exceeds $10,000 may seek
a review of the order in the United States court of appeals for
the circuit in which the violation is alleged to have occurred or
in which the complainant resides.
__(2) Further review._Upon the filing of the record with the
court, the jurisdiction of the court shall be exclusive and its
judgment shall be final, except that the judgment shall be
subject to review by the Supreme Court of the United States upon
writ of certiorari or certification as provided in section 1254
of title 28 of the United States Code.
__(3) Enforcement decree in original review._If, upon appeal of
an order under paragraph (1), the United States court of appeals
does not reverse the order, the court shall have the jurisdiction
to make and enter a decree enforcing the order of the Review
Board.
__(f) Determinations._Determinations made under this section
shall be in accordance with the provisions of this Act, the
comprehensive benefit package as provided by this Act, the rules
and regulations of the National Health Board prescribed under
this Act, and decisions of the National Health Board published
under this Act.
__(g) Awarding of Attorneys' Fees and Other Costs and
Expenses._In any proceeding before the Review Board under this
section or any judicial proceeding under subsection (e), the
Review Board or the court (as the case may be) shall award to a
prevailing complainant reasonable costs and expenses (including a
reasonable attorney's fee) on the causes on which the complainant
prevails.
SEC. 5206. CIVIL MONEY PENALTIES.
__(a) Denial or Delay in Payment or Provision of Benefits._
__(1) In general._The Secretary of Labor may assess a civil
penalty against any health plan, or against any other plan in
connection with benefits provided thereunder under a cost sharing
policy described in section 1421(b)(2), for unreasonable denial
or delay in the payment or provision of benefits thereunder, in
an amount not to exceed_
__(A) $25,000 per violation, or $75,000 per violation in the case
of a finding of bad faith on the part of the plan, and
__(B) in the case of a finding of a pattern or practice of such
violations engaged in by the plan, $1,000,000 in addition to the
total amount of penalties assessed under subparagraph (A) with
respect to such violations.
For purposes of subparagraph (A), each violation with respect to
any single individual shall be treated as a separate violation.
__(2) Civil action to enforce civil penalty._The Secretary of
Labor may commence a civil action in any court of competent
jurisdiction to enforce a civil penalty assessed under subsection
(a).
__(b) Civil Penalties for Certain Other Actions._The Secretary of
Labor may assess a civil penalty described in section 5412(b)(1)
against any corporate alliance health plan, or against any other
plan sponsored by a corporate alliance in connection with
benefits provided thereunder under a cost sharing policy
described in section 1421(b)(2), for any action described in
section 5412(a). The Secretary of Labor may initiate proceedings
to impose such penalty in the same manner as the Secretary of
Health and Human Services may initiate proceedings under section
5412 with respect to actions described in section 5412(a).
Subpart B_Early Resolution Programs
SEC. 5211. ESTABLISHMENT OF EARLY RESOLUTION PROGRAMS IN
COMPLAINT REVIEW OFFICES.
__(a) Establishment of Programs._Each State shall establish and
maintain an Early Resolution Program in each complaint review
office in such State. The Program shall include_
__(1) the establishment and maintenance of forums for mediation
of disputes in accordance with this subpart, and
__(2) the establishment and maintenance of such forums for other
forms of alternative dispute resolution (including binding
arbitration) as may be prescribed in regulations of the Secretary
of Labor.
Each State shall ensure that the standards applied in Early
Resolution Programs administered in such State which apply to any
form of alternative dispute resolution described in paragraph (2)
and which relate to time requirements, qualifications of
facilitators, arbitrators, or other mediators, and
confidentiality are at least equivalent to the standards which
apply to mediation proceedings under this subpart.
__(b) Duties of Complaint Review Offices._Each complaint review
office in a State_
__(1) shall administer its Early Resolution Program in accordance
with regulations of the Secretary of Labor,
__(2) shall, pursuant to subsection (a)(1)_
__(A) recruit and train individuals to serve as facilitators for
mediation proceedings under the Early Resolution Program from
attorneys who have the requisite expertise for such service,
which shall be specified in regulations of the Secretary of
Labor,
__(B) provide meeting sites, maintain records, and provide
facilitators with administrative support staff, and
__(C) establish and maintain attorney referral panels,
__(3) shall ensure that, upon the filing of a complaint with the
office, the complainant is adequately apprised of the
complainant's options for review under this part, and
__(4) shall monitor and evaluate the Program on an ongoing basis.
SEC. 5212. INITIATION OF PARTICIPATION IN MEDIATION PROCEEDINGS.
__(a) Eligibility of Cases for Submission to Early Resolution
Program._A dispute may be submitted to the Early Resolution
Program only if the following requirements are met with respect
to the dispute:
__(1) Nature of dispute._The dispute consists of an assertion by
an individual enrolled under a health plan of one or more claims
against the health plan for payment or provision of benefits, or
against any other plan maintained by the regional alliance or
corporate alliance sponsoring the health plan with respect to
benefits provided under a cost sharing policy described in
section 1421(b)(2), based on alleged coverage under the plan, and
a denial of the claims, or a denial of appropriate reimbursement
based on the claims, by the plan.
__(2) Nature of disputed claim._Each claim consists of_
__(A) a claim for payment or provision of benefits under the
plan; or
__(B) a request for information or documents the disclosure of
which is required under this Act (including claims of entitlement
to disclosure based on colorable claims to rights to benefits
under the plan).
__(b) Filing of Election._A complainant with a dispute which is
eligible for submission to the Early Resolution Program may make
the election under section 5203(a)(2) to submit the dispute to
mediation proceedings under the Program not later than 15 days
after the date the complaint is filed with the complaint review
office under subpart A.
__(c) Agreement to Participate._
__(1) Election by claimant._A complainant may elect participation
in the mediation proceedings only by entering into a written
agreement (including an agreement to comply with the rules of the
Program and consent for the complaint review office to contact
the health plan regarding the agreement), and by releasing plan
records to the Program for the exclusive use of the facilitator
assigned to the dispute.
__(2) Participation by plans or health benefits contractors._Each
party whose participation in the mediation proceedings has been
elected by a claimant pursuant to paragraph (1) shall participate
in, and cooperate fully with, the proceedings. The claims review
office shall provide such party with a copy of the participation
agreement described in paragraph (1), together with a written
description of the Program. Such party shall submit the copy of
the agreement, together with its authorized signature signifying
receipt of notice of the agreement, to the claims review office,
and shall include in the submission to the claims review office a
copy of the written record of the plan claims procedure completed
pursuant to section 5201 with respect to the dispute and all
relevant plan documents. The relevant documents shall include all
documents under which the health plan is or was administered or
operated, including copies of any insurance contracts under which
benefits are or were provided and any fee or reimbursement
schedules for health care providers.
SEC. 5213. MEDIATION PROCEEDINGS.
__(a) Role of Facilitator._In the course of mediation proceedings
under the Early Resolution Program, the facilitator assigned to
the dispute shall prepare the parties for a conference regarding
the dispute and serve as a neutral mediator at such conference,
with the goal of achieving settlement of the dispute.
__(b) Preparations for Conference._In advance of convening the
conference, after identifying the necessary parties and
confirming that the case is eligible for the Program, the
facilitator shall analyze the record of the claims procedure
conducted pursuant to section 5201 and any position papers
submitted by the parties to determine if further case development
is needed to clarify the legal and factual issues in dispute, and
whether there is any need for additional information and
documents.
__(c) Conference._Upon convening the conference, the facilitator
shall assist the parties in identifying undisputed issues and
exploring settlement. If settlement is reached, the facilitator
shall assist in the preparation of a written settlement
agreement. If no settlement is reached, the facilitator shall
present the facilitator's evaluation, including an assessment of
the parties' positions, the likely outcome of further
administrative action or litigation, and suggestions for
narrowing the issues in dispute.
__(d) Time Limit._The facilitator shall ensure that mediation
proceedings with respect to any dispute under the Early
Resolution Program shall be completed within 120 days after the
election to participate. The parties may agree to one extension
of the proceedings by not more than 30 days if the proceedings
are suspended to obtain an agency ruling or to reconvene the
conference in a subsequent session.
__(e) Inapplicability of Formal Rules._Formal rules of evidence
shall not apply to mediation proceedings under the Early
Resolution Program. All statements made and evidence presented in
the proceedings shall be admissible in the proceedings. The
facilitator shall be the sole judge of the proper weight to be
afforded to each submission. The parties to mediation proceedings
under the Program shall not be required to make statements or
present evidence under oath.
__(f) Representation._Parties may participate pro se or be
represented by attorneys throughout the proceedings of the Early
Resolution Program.
__(g) Confidentiality._
__(1) In general._Under regulations of the Secretary of Labor,
rules similar to the rules under section 574 of title 5, United
States Code (relating to confidentiality in dispute resolution
proceedings) shall apply to the mediation proceedings under the
Early Resolution Program.
__(2) Civil remedies._The Secretary of Labor may assess a civil
penalty against any person who discloses information in violation
of the regulations prescribed pursuant to subsection (a) in the
amount of three times the amount of the claim involved. The
Secretary of Labor may bring a civil action to enforce such civil
penalty in any court of competent jurisdiction.
SEC. 5214. LEGAL EFFECT OF PARTICIPATION IN MEDIATION
PROCEEDINGS.
__(a) Process Nonbinding._Findings and conclusions made in the
mediation proceedings of the Early Resolution Program shall be
treated as advisory in nature and nonbinding. Except as provided
in subsection (b), the rights of the parties under subpart A
shall not be affected by participation in the Program.
__(b) Resolution Through Settlement Agreement._If a case is
settled through participation in mediation proceedings under the
Program, the facilitator shall assist the parties in drawing up
an agreement which shall constitute, upon signature of the
parties, a binding contract between the parties, which shall be
enforceable under section 5215.
__(c) Preservation of Rights of Non-Parties._The settlement
agreement shall not have the effect of waiving or otherwise
affecting any rights to review under subpart A, or any other
right under this Act or the plan, with respect to any person who
is not a party to the settlement agreement.
SEC. 5215. ENFORCEMENT OF SETTLEMENT AGREEMENTS.
__(a) Enforcement._Any party to a settlement agreement entered
pursuant to mediation proceedings under this subpart may petition
any court of competent jurisdiction for the enforcement of the
agreement, by filing in the court a written petition praying that
the agreement be enforced. In such a proceeding, the order of the
hearing officer shall not be subject to review.
__(b) Court Review._It shall be the duty of the court to advance
on the docket and to expedite to the greatest possible extent the
disposition of any petition filed under this section, with due
deference to the role of settlement agreements under this part in
achieving prompt resolution of disputes involving health plans.
__(d) Awarding of Attorney's Fees and Other Costs and
Expenses._In any action by an individual enrolled under a health
plan for court enforcement under this section, a prevailing
plaintiff shall be entitled to reasonable costs and expenses
(including a reasonable attorney's fee and reasonable expert
witness fees) on the charges on which the plaintiff prevails.
PART 2_ADDITIONAL REMEDIES AND ENFORCEMENT PROVISIONS
SEC. 5231. JUDICIAL REVIEW OF FEDERAL ACTION ON STATE SYSTEMS.
__(a) In General._Any State or an alliance that is aggrieved by a
determination by the National Health Board under subpart B of
part 1 of subtitle F of title I shall be entitled to judicial
review of such determination in accordance with this section.
__(b) Judicial Review._
__(1) Jurisdiction._The courts of appeals of the United States
(other than the United States Court of Appeals for the Federal
Circuit) shall have jurisdiction to review a determination
described in subsection (a), to affirm the determination, or to
set it aside, in whole or in part. A judgment of a court of
appeals in such an action shall be subject to review by the
Supreme Court of the United States upon certiorari or
certification as provided in section 1254 of title 28, United
States Code.
__(2) Petition for review._A State or an alliance that desires
judicial review of a determination described in subsection (a)
shall, within 30 days after it has been notified of such
determination, file with the United States court of appeals for
the circuit in which the State or alliance is located a petition
for review of such determination. A copy of the petition shall be
transmitted by the clerk of the court to the National Health
Board, and the Board shall file in the court the record of the
proceedings on which the determination or action was based, as
provided in section 2112 of title 28, United States Code.
__(3) Scope of review._The findings of fact of the National
Health Board, if supported by substantial evidence, shall be
conclusive; but the court, for good cause shown, may remand the
case to the Board to take further evidence, and the Board may
make new or modified findings of fact and may modify its previous
action, and shall certify to the court the record of the further
proceedings. Such new or modified findings of fact shall likewise
be conclusive if supported by substantial evidence.
SEC. 5232. ADMINISTRATIVE AND JUDICIAL REVIEW RELATING TO COST
CONTAINMENT.
__There shall be no administrative or judicial review of any
determination by the National Health Board respecting any matter
under subtitle A of title VI.
SEC. 5233. CIVIL ENFORCEMENT.
__Unless otherwise provided in this Act, the district courts of
the United States shall have jurisdiction of civil actions
brought by_
__(1) the Secretary of Labor to enforce any final order of such
Secretary or to collect any civil monetary penalty assessed by
such Secretary under this Act; and
__(2) the Secretary of Health and Human Services to enforce any
final order of such Secretary or to collect any civil monetary
penalty assessed by such Secretary under this Act.
SEC. 5234. PRIORITY OF CERTAIN BANKRUPTCY CLAIMS.
__Section 507(a)(8) of title 11, United States Code, is amended
to read as follows:
__``(8) Eighth, allowed unsecured claims_
__``(A) based upon any commitment by the debtor to the Federal
Deposit Insurance Corporation, the Resolution Trust Corporation,
the Director of the Office of Thrift Supervision, the Comptroller
of the Currency, or the Board of Governors of the Federal Reserve
System, or their predecessors or successors, to maintain the
capital of an insured depository institution;
__``(B) for payments under subtitle B of title IV of the Health
Security Act owed to a regional alliance (as defined in section
1301 of such Act);
__``(C) for payments owed to a corporate alliance health plan
under trusteeship of the Secretary of Labor under section 1395 of
the Health Security Act; or
__``(D) for assessments and related amounts owed to the Secretary
of Labor under section 1397 of the Health Security Act.''.
SEC. 5235. PRIVATE RIGHT TO ENFORCE STATE RESPONSIBILITIES.
__The failure of a participating State to carry out a
responsibility applicable to participating States under this Act
constitutes a deprivation of rights secured by this Act for the
purposes of section 1977 of the Revised Statutes of the United
States (42 U.S.C. 1983). In an action brought under such section,
the court shall exercise jurisdiction without regard to whether
the aggrieved person has exhausted any administrative or other
remedies that may be provided by law.
SEC. 5236. PRIVATE RIGHT TO ENFORCE FEDERAL RESPONSIBILITIES IN
OPERATING A SYSTEM IN A STATE.
__(a) In General._The failure of the Secretary of Health and
Human Services to carry out a responsibility under section 1522
(relating to operation of an alliance system in a State) confers
an enforceable right of action on any person who is aggrieved by
such failure. Such a person may commence a civil action against
the Secretary in an appropriate State court or district court of
the United States.
__(b) Exhaustion of Remedies._In an action under subsection (a),
the court shall exercise jurisdiction without regard to whether
the aggrieved person has exhausted any administrative or other
remedies that may be provided by law.
__(c) Relief._In an action under subsection (a), if the court
finds that a failure described in such subsection has occurred,
the aggrieved person may recover compensatory and punitive
damages and the court may order any other appropriate relief.
__(d) Attorney's Fees._In an action under subsection (a), the
court, in its discretion, may allow the prevailing party, other
than the United States, a reasonable attorney's fee (including
expert fees) as part of the costs, and the United States shall be
liable for costs the same as a private person.
SEC. 5237. PRIVATE RIGHT TO ENFORCE RESPONSIBILITIES OF
ALLIANCES.
__(a) In General._The failure of a regional alliance or a
corporate alliance to carry out a responsibility applicable to
the alliance under this Act confers an enforceable right of
action on any person who is aggrieved by such failure. Such a
person may commence a civil action against the alliance in an
appropriate State court or district court of the United States.
__(b) Exhaustion of Remedies._
__(1) In general._Except as provided in paragraph (2), in an
action under subsection (a) the court may not exercise
jurisdiction until the aggrieved person has exhausted any
administrative remedies that may be provided by law.
__(2) No exhaustion required._In an action under subsection (a),
the court shall exercise jurisdiction without regard to whether
the aggrieved person has exhausted any administrative or other
remedies that may be provided by law if the action relates to_
__(A) whether the person is an eligible individual within the
meaning of section 1001(c);
__(B) whether the person is eligible for a premium discount under
subpart A of part 1 of subtitle B of title VI;
__(C) whether the person is eligible for a reduction in cost
sharing under subpart D of part 3 of subtitle D of title I; or
__(D) enrollment or disenrollment in a health plan.
__(c) Relief._In an action under subsection (a), if the court
finds that a failure described in such subsection has occurred,
the aggrieved person may recover compensatory and punitive
damages and the court may order any other appropriate relief.
__(d) Attorney's Fees._In any action under subsection (a), the
court, in its discretion, may allow the prevailing party, other
than the United States, a reasonable attorney's fee (including
expert fees) as part of the costs, and the United States shall be
liable for costs the same as a private person.
SEC. 5238. DISCRIMINATION CLAIMS.
__(a) Civil Action by Aggrieved Person._
__(1) In general._Any person who is aggrieved by the failure of a
health plan to comply with section 1402(c) may commence a civil
action against the plan in an appropriate State court or district
court of the United States.
__(2) Standards._The standards used to determine whether a
violation has occurred in a complaint alleging discrimination
under section 1402(c) shall be the standards applied under the
Age Discrimination Act of 1973 (42 U.S.C. 6102 et seq.) and the
Americans with Disabilities Act of 1990 (42 U.S.C. 12101 et
seq.).
__(3) Relief._In an action under paragraph (1), if the court
finds that the health plan has failed to comply with section
1402(c), the aggreived person may recover compensatory and
punitive damages and the court may order any other appropriate
relief.
__(4) Attorney's fees._In any action under paragraph (1), the
court, in its discretion, may allow the prevailing party, other
than the United States, a reasonable attorney's fee (including
expert fees) as part of the costs, and the United States shall be
liable for costs the same as a private person.
__(c) Action by Secretary._Whenever the Secretary of Health and
Human Services finds that the health plan has failed to comply
with section 1402(c), or with an applicable regulation issued
under such section, the Secretary shall notify the plan. If
within a reasonable period of time the health plan fails or
refuses to comply, the Secretary may_
__(1) refer the matter to the Attorney General with a
recommendation that an appropriate civil action be instituted;
__(2) terminate the participation of the health plan in an
alliance; or
__(3) take such other action as may be provided by law.
__(d) Action by Attorney General._When a matter is referred to
the Attorney General under subsection (c)(1), the Attorney
General may bring a civil action in a district court of the
United States for such relief as may be appropriate, including
injunctive relief. In a civil action under this section, the
court_
__(1) may grant any equitable relief that the court considers to
be appropriate;
__(2) may award such other relief as the court considers to be
appropriate, including compensatory and punitive damages; and
__(3) may, to vindicate the public interest when requested by the
Attorney General, assess a civil money penalty against the health
plan in an amount_
__(A) not exceeding $50,000 for a first violation; and
__(B) not exceeding $100,000 for any subsequent violation.
SEC. 5239. NONDISCRIMINATION IN FEDERALLY ASSISTED PROGRAMS.
__Federal payments to regional alliances under part 2 of subtitle
C of title VI shall be treated as Federal financial assistance
for purposes of section 504 of the Rehabilitation Act of 1973 (29
U.S.C. 794), section 303 of the Age Discrimination Act of 1975
(42 U.S.C. 6102), and section 601 of the Civil Rights Act of 1964
(42 U.S.C. 2000d).
SEC. 5240. CIVIL ACTION BY ESSENTIAL COMMUNITY PROVIDER.
__(a) In General._An electing essential community provider (as
defined in section 1431(d)) who is aggrieved by the failure of a
health plan to fulfill a duty imposed on the plan by section 1431
may commence a civil action against the plan in an appropriate
State court or district court of the United States.
__(b) Relief._In an action under subsection (a), if the court
finds that the health plan has failed to fulfill a duty imposed
on the plan by section 1431, the electing essential community
provider may recover compensatory damages and the court may order
any other appropriate relief.
__(c) Attorney's Fees._In any action under subsection (a), the
court, in its discretion, may allow the prevailing party, other
than the United States, a reasonable attorney's fee (including
expert fees) as part of the costs, and the United States shall be
liable for costs the same as a private person.
SEC. 5241. FACIAL CONSTITUTIONAL CHALLENGES.
__(a) Jurisdiction._The United States District Court for the
District of Columbia shall have original and exclusive
jurisdiction of any civil action brought to invalidate this Act
or a provision of this Act on the ground of its being repugnant
to the Constitution of the United States on its face and for
every purpose. In any action described in this subsection, the
district court may not grant any temporary order or preliminary
injunction restraining the enforcement, operation, or execution
of this Act or any provision of this Act.
__(b) Statute of Limitations._An action described in subsection
(a) shall be commenced not later than 1 year after the date of
the enactment of this Act.
__(c) Convening of Three-Judge Court._An action described in
subsection (a) shall be heard and determined by a district court
of three judges in accordance with section 2284 of title 28,
United States Code.
__(d) Consolidation._When actions described in subsection (a)
involving a common question of law or fact are pending before a
district court, the court shall order all the actions
consolidated.
__(e) Direct Appeal to Supreme Court._In any action described in
subsection (a), an appeal may be taken directly to the Supreme
Court of the United States from any final judgment, decree, or
order in which the district court_
__(1) holds this Act or any provision of this Act invalid; and
__(2) makes a determination that its holding will materially
undermine the application of the Act as whole.
__(f) Construction._This section does not limit_
__(1) the right of any person_
__(A) to a litigation concerning the Act or any portion of the
Act; or
__(B) to petition the Supreme Court for review of any holding of
a district court by writ of certiorari at any time before the
rendition of judgment in a court of appeals; or
__(2) the authority of the Supreme Court to grant a writ of
certiorari for the review described in paragraph (1)(B).
SEC. 5242. TREATMENT OF PLANS AS PARTIES IN CIVIL ACTIONS.
__(a) In General._A health plan may sue or be sued under this Act
as an entity. Service of summons, subpoena, or other legal
process of a court or hearing officer upon a trustee or an
administrator of any such plan in his capacity as such shall
constitute service upon the plan. In a case where a plan has not
designated in applicable plan documents an individual as agent
for the service of legal process, service upon the Secretary of
Health and Human Services (in the case of a regional alliance
health plan) or the Secretary of Labor (in the case of a
corporate alliance health plan) shall constitute such service.
The Secretary, not later than 15 days after receipt of service
under the preceding sentence, shall notify the administrator or
any trustee of the plan of receipt of such service.
__(b) Other Parties._Any money judgment under this Act against a
plan referred to in subsection (b) shall be enforceable only
against the plan as an entity and shall not be enforceable
against any other person unless liability against such person is
established in his individual capacity under this Act.
SEC. 5243. GENERAL NONPREEMPTION OF EXISTING RIGHTS AND REMEDIES.
__Nothing in this title shall be construed to deny, impair, or
otherwise adversely affect a right or remedy available under law
to any person on the date of the enactment of this Act or
thereafter, except to the extent the right or remedy is
inconsistent with this title.
Title V, Subtitle D
Subtitle D_Medical Malpractice
PART 1_LIABILITY REFORM
SEC. 5301. FEDERAL TORT REFORM.
__(a) Applicability._
__(1) In general._Except as provided in section 5302, this part
shall apply with respect to any medical malpractice liability
action brought in any State or Federal court, except that this
part shall not apply to a claim or action for damages arising
from a vaccine-related injury or death to the extent that title
XXI of the Public Health Service Act applies to the claim or
action.
__(2) Preemption._The provisions of this part shall preempt any
State law to the extent such law is inconsistent with the
limitations contained in such provisions. The provisions of this
part shall not preempt any State law that provides for defenses
or places limitations on a person's liability in addition to
those contained in this subtitle, places greater limitations on
the amount of attorneys' fees that can be collected, or otherwise
imposes greater restrictions than those provided in this part.
__(3) Effect on sovereign immunity and choice of law or
venue._Nothing in paragraph (2) shall be construed to_
__(A) waive or affect any defense of sovereign immunity asserted
by any State under any provision of law;
__(B) waive or affect any defense of sovereign immunity asserted
by the United States;
__(C) affect the applicability of any provision of the Foreign
Sovereign Immunities Act of 1976;
__(D) preempt State choice-of-law rules with respect to claims
brought by a foreign nation or a citizen of a foreign nation; or
__(E) affect the right of any court to transfer venue or to apply
the law of a foreign nation or to dismiss a claim of a foreign
nation or of a citizen of a foreign nation on the ground of
inconvenient forum.
__(4) Federal court jurisdiction not established on federal
question grounds._Nothing in this part shall be construed to
establish any jurisdiction in the district courts of the United
States over medical malpractice liability actions on the basis of
section 1331 or 1337 of title 28, United States Code.

__(b) Definitions._In this subtitle, the following definitions
apply:
__(1) Alternative dispute resolution system; ADR._The term
``alternative dispute resolution system'' or ``ADR'' means a
system that provides for the resolution of medical malpractice
claims in a manner other than through medical malpractice
liability actions.
__(2) Claimant._The term ``claimant'' means any person who
alleges a medical malpractice claim, and any person on whose
behalf such a claim is alleged, including the decedent in the
case of an action brought through or on behalf of an estate.
__(3) Health care professional._The term ``health care
professional'' means any individual who provides health care
services in a State and who is required by the laws or
regulations of the State to be licensed or certified by the State
to provide such services in the State.
__(4) Health care provider._The term ``health care provider''
means any organization or institution that is engaged in the
delivery of health care services in a State and that is required
by the laws or regulations of the State to be licensed or
certified by the State to engage in the delivery of such services
in the State.
__(5) Injury._The term ``injury'' means any illness, disease, or
other harm that is the subject of a medical malpractice liability
action or a medical malpractice claim.
__(6) Medical malpractice liability action._The term ``medical
malpractice liability action'' means a civil action brought in a
State or Federal court against a health care provider or health
care professional (regardless of the theory of liability on which
the claim is based) in which the plaintiff alleges a medical
malpractice claim.
__(7) Medical malpractice claim._The term ``medical malpractice
claim'' means a claim in a civil action brought against a health
care provider or health care professional in which a claimant
alleges that injury was caused by the provision of (or the
failure to provide) health care services, except that such term
does not include_
__(A) any claim based on an allegation of an intentional tort; or
__(B) any claim based on an allegation that a product is
defective that is brought against any individual or entity that
is not a health care professional or health care provider.

SEC. 5302. PLAN-BASED ALTERNATIVE DISPUTE RESOLUTION MECHANISMS.
__(a) Application to Malpractice Claims Under Plans._In the case
of any medical malpractice claim arising from the provision of
(or failure to provide) health care services to an individual
enrolled in a regional alliance plan or a corporate alliance
plan, no medical malpractice liability action may be brought with
respect to such claim until the final resolution of the claim
under the alternative dispute resolution system adopted by the
plan under subsection (b).

__(b) Adoption of Mechanism by Plans._Each regional alliance plan
and corporate alliance plan shall_
__(1) adopt at least one of the alternative dispute resolution
methods specified under subsection (c) for the resolution of
medical malpractice claims arising from the provision of health
care services to individuals enrolled in the plan; and
__(2) disclose to enrollees (and potential enrollees), in a
manner specified by the regional alliance or the corporate
alliance, the availability and procedures for consumer grievances
under the plan, including the alternative dispute resolution
method or methods adopted under this subsection.


__(c) Specification of Permissible Alternative Dispute Resolution
Methods._
__(1) In general._The National Health Board shall, by regulation,
develop alternative dispute resolution methods for the use by
regional alliance and corporate alliance plans in resolving
medical malpractice claims under subsection (a). Such methods
shall include at least the following:
__(A) Arbitration._The use of arbitration.
__(B) Mediation._The use of required mediation.
__(C) Early offers of settlement._The use of a process under
which parties are required to make early offers of settlement.

__(2) Standards for establishing methods._In developing
alternative dispute resolution methods under paragraph (1), the
National Health Board shall assure that the methods promote the
resolution of medical malpractice claims in a manner that_
__(A) is affordable for the parties involved;
__(B) provides for timely resolution of claims;
__(C) provides for the consistent and fair resolution of claims;
and
__(D) provides for reasonably convenient access to dispute
resolution for individuals enrolled in plans.
__(d) Further Redress._A plan enrollee dissatisfied with the
determination reached as a result of an alternative dispute
resolution method applied under this section may, after the final
resolution of the enrollee's claim under the method, bring a
cause of action to seek damages or other redress with respect to
the claim to the extent otherwise permitted under State law.
SEC. 5303. REQUIREMENT FOR CERTIFICATE OF MERIT.
__(a) Requiring Submission With Complaint._No medical malpractice
liability action may be brought by any individual unless, at the
time the individual brings the action (except as provided in
subsection (b)(2)), the individual submits an affidavit_
__(1) declaring that the individual (or the individual's
attorney) has consulted and reviewed the facts of the action with
a qualified medical specialist (as defined in subsection (c));
__(2) including a written report by a qualified medical
specialist that clearly identifies the individual and that
includes the medical specialist's determination that, after a
review of the medical record and other relevant material, there
is a reasonable and meritorious cause for the filing of the
action against the defendant; and
__(3) on the basis of the qualified medical specialist's review
and consultation, that the individual (or the individual's
attorney) has concluded that there is a reasonable and
meritorious cause for the filing of the action.
__(b) Extension in Certain Instances._
__(1) In general._Subject to paragraph (2), subsection (a) shall
not apply with respect to an individual who brings a medical
malpractice liability action without submitting an affidavit
described in such subsection if_
__(A) the individual is unable to obtain the affidavit before the
expiration of the applicable statute of limitations; or
__(B) at the time the individual brings the action, the
individual has been unable to obtain medical records or other
information necessary to prepare the affidavit requested pursuant
to any applicable law.
__(2) Deadline for submission where extension applies._In the
case of an individual who brings an action for which paragraph
(1) applies, the action shall be dismissed unless the individual
submits the affidavit described in subsection (a) not later than_
__(A) in the case of an action for which subparagraph (A) of
paragraph (1) applies, 90 days after bringing the action; or
__(B) in the case of an action for which subparagraph (B) of
paragraph (1) applies, 90 days after obtaining the information
described in such subparagraph.
__(c) Qualified Medical Specialist Defined._In subsection (a), a
``qualified medical specialist'' means, with respect to a
defendant to a medical malpractice liability action, a health
care professional who_
__(1) is knowledgeable of, and has expertise in, the same
specialty area of medical practice that is the subject of the
action; and
__(2) is reasonably believed by the individual bringing the
action (or the individual's attorney)_
__(A) to be knowledgeable in the relevant issues involved in the
particular action,
__(B) to practice (or to have practiced within the preceding 6
years) or to teach (or to have taught within the preceding 6
years) in the same area of health care or medicine that is at
issue in the action, and
__(C) to be qualified by experience or demonstrated competence in
the subject of the case.
__(d) Sanctions for Submitting False Allegations._Upon the motion
of any party or its own initiative, the court in a medical
malpractice liability action may impose a sanction on a party or
the party's attorney (or both), including a requirement that the
party reimburse the other party to the action for costs and
reasonable attorney's fees, if any information contained in an
affidavit described in subsection (a) is submitted without
reasonable cause and is found to be untrue.
SEC. 5304. LIMITATION ON AMOUNT OF ATTORNEY'S CONTINGENCY FEES.
__(a) In General._An attorney who represents, on a contingency
fee basis, a plaintiff in a medical malpractice liability action
may not charge, demand, receive, or collect for services rendered
in connection with such action (including the resolution of the
claim that is the subject of the action under any alternative
dispute resolution) in excess of 33\1/3\ of the total amount
recovered by judgment or settlement in such action.
__(b) Calculation of periodic payments._In the event that a
judgment or settlement includes periodic or future payments of
damages, the amount recovered for purposes of computing the
limitation on the contingency fee under subsection (a) shall be
based on the cost of the annuity or trust established to make the
payments. In any case in which an annuity or trust is not
established to make such payments, such amount shall be based on
the present value of the payments.
__(c) Contingency Fee Defined._As used in this section, the term
``contingency fee'' means any fee for professional legal services
which is, in whole or in part, contingent upon the recovery of
any amount of damages, whether through judgment or settlement.
SEC. 5305. REDUCTION OF AWARDS FOR RECOVERY FROM COLLATERAL
SOURCES.
__The total amount of damages recovered by a plaintiff in a
medical malpractice liability action shall be reduced by the
amount of any past or future payment which the claimant has
received or for which the claimant is eligible on account of the
same injury for which the damages are awarded, including payment
under_
__(1) Federal or State disability or sickness programs;
__(2) Federal, State, or private health insurance programs;
__(3) private disability insurance programs;
__(4) employer wage continuation programs; and
__(5) any other program, if the payment is intended to compensate
the claimant for the same injury for which damages are awarded.
SEC. 5306. PERIODIC PAYMENT OF AWARDS.
__At the request of any party to a medical malpractice liability
action, the defendant shall not be required to pay damages in a
single, lump-sum payment, but shall be permitted to make such
payments periodically based on such schedule as the court
considers appropriate, taking into account the periods for which
the injured party will need medical and other services.

PART 2_OTHER PROVISIONS RELATING TO MEDICAL MALPRACTICE LIABILITY
SEC. 5311. ENTERPRISE LIABILITY DEMONSTRATION PROJECT.
__(a) Establishment._Not later than January 1, 1996, the
Secretary of Health and Human Services shall establish a
demonstration project under which the Secretary shall provide
funds (in such amount as the Secretary considers appropriate) to
one or more eligible States to demonstrate whether substituting
liability for medical malpractice on the part of the health plan
in which a physician participates for the personal liability of
the physician will result in improvements in the quality of care
provided under the plan, reductions in defensive medical
practices, and better risk management.
__(b) Eligibility of State._A State is eligible to participate in
the demonstration project established under subsection (a) if the
State submits an application to the Secretary (at such time and
in such form as the Secretary may require) containing such
information and assurances as the Secretary may require,
including assurances that the State_
__(1) has entered into an agreement with a health plan (other
than a fee-for-service plan) operating in the State under which
the plan assumes legal liability with respect to any medical
malpractice claim arising from the provision of (or failure to
provide) services under the plan by any physician participating
in the plan;
__(2) has provided that, under the law of the State, a physician
participating in a plan that has entered into an agreement with
the State under paragraph (1) may not be liable in damages or
otherwise for such a claim and the plan may not require such
physician to indemnify the plan for any such liability; and
__(3) will provide the Secretary with such reports on the
operation of the project as the Secretary may require.
__(c) Authorization of Appropriations._There are authorized to be
appropriated such sums as may be necessary to carry out
demonstration projects under this section.
SEC. 5312. PILOT PROGRAM APPLYING PRACTICE GUIDELINES TO MEDICAL
MALPRACTICE LIABILITY ACTIONS.
__(a) Establishment._Not later than 1 year after the Secretary of
Health and Human Services determines that appropriate practice
guidelines are available, the Secretary shall establish a pilot
program under which the Secretary shall provide funds (in such
amount as the Secretary considers appropriate) to one or more
eligible States to determine the effect of applying practice
guidelines in the resolution of medical malpractice liability
actions.
__(b) Eligibility of State._A State is eligible to participate in
the pilot program established under subsection (a) if the State
submits an application to the Secretary (at such time and in such
form as the Secretary may require) containing_
__(1) assurances that, under the law of the State, in the
resolution of any medical malpractice liability action, it shall
be a complete defense to any allegation that a party against whom
the action is filed was negligent that, in the provision of (or
the failure to provide) the services that are the subject of the
action, the party followed the appropriate practice guideline
established by the National Quality Management Program under
subtitle A; and
__(2) such other information and assurances as the Secretary may
require.
__(c) Reports to Congress._Not later than 3 months after each
year for which the pilot program established under subsection (a)
is in effect, the Secretary shall submit a report to Congress
describing the operation of the program during the previous year
and containing such recommendations as the Secretary considers
appropriate, including recommendations relating to revisions to
the laws governing medical malpractice liability.
Title V, Subtitle E
Subtitle E_Fraud and Abuse
PART 1_ESTABLISHMENT OF ALL-PAYER HEALTH CARE FRAUD AND ABUSE
CONTROL PROGRAM
SEC. 5401. ALL-PAYER HEALTH CARE FRAUD AND ABUSE CONTROL PROGRAM.
__(a) In General._Not later than January 1, 1996, the Secretary
of Health and Human Services (acting through the Office of the
Inspector General of the Department of Health and Human Services)
and the Attorney General shall establish a program_
__(1) to coordinate the functions of the Attorney General, the
Secretary, and other organizations with respect to the
prevention, detection, and control of health care fraud and
abuse,
__(2) to conduct investigations, audits, evaluations, and
inspections relating to the delivery of and payment for health
care in the United States, and
__(3) to facilitate the enforcement of this subtitle and other
statutes applicable to health care fraud and abuse.
__(b) Coordination With Law Enforcement Agencies._In carrying out
the program under subsection (a), the Secretary and Attorney
General shall consult with, and arrange for the sharing of data
and resources with Federal, State and local law enforcement
agencies, State Medicaid Fraud Control Units, and State agencies
responsible for the licensing and certification of health care
providers.
__(c) Coordination With Health Alliances and Health Plans._In
carrying out the program under subsection (a), the Secretary and
Attorney General shall consult with, and arrange for the sharing
of data with representatives of health alliances and health
plans.
__(d) Authorities of Attorney General, Secretary, and Inspector
General._In carrying out duties established under subsection (a),
the Attorney General, the Secretary, and the Inspector General
are authorized_
__(1) to conduct, supervise, and coordinate audits, civil and
criminal investigations, inspections, and evaluations relating to
the program established under such subsection; and
__(2) to have access (including on-line access as requested and
available) to all records available to health alliances and
health plans that relate to ongoing investigations or the
imposition of sanctions under such program (subject to
restrictions based on the confidentiality of certain information
under subtitle B).

__(e) Qualified Immunity for Providing Information._The
provisions of section 1157(a) of the Social Security Act
(relating to limitation on liability) shall apply to a person
providing information or communications to the Secretary or
Attorney General in conjunction with their performance of duties
under this section, in the same manner as such section applies to
information provided to organizations with a contract under part
B of title XI of such Act.
__(f) Authorizations of Appropriations for Investigators and
Other Personnel._In addition to any other amounts authorized to
be appropriated to the Secretary and the Attorney General for
health care anti-fraud and abuse activities for a fiscal year,
there are authorized to be appropriated such additional amounts
as may be necessary to enable the Secretary and the Attorney
General to conduct investigations, audits, evaluations, and
inspections of allegations of health care fraud and abuse and
otherwise carry out the program established under subsection (a)
in a fiscal year.
__(g) Use of Powers Under Inspector General Act of 1978._In
carrying out duties and responsibilities under the program
established under subsection (a), the Inspector General is
authorized to exercise all powers granted under the Inspector
General Act of 1978 to the same manner and extent as provided in
that Act.
__(h) Definitions._In this part and part 2_
__(1) the term ``Inspector General'' means the Inspector General
of the Department of Health and Human Services; and
__(2) the term ``Secretary'' means Secretary of Health and Human
Services.
SEC. 5402. ESTABLISHMENT OF ALL-PAYER HEALTH CARE FRAUD AND ABUSE
CONTROL ACCOUNT.
__(a) Establishment._
__(1) In general._There is hereby created on the books of the
Treasury of the United States an account to be known as the
``All-Payer Health Care Fraud and Abuse Control Account'' (in
this section referred to as the ``Anti-Fraud Account ''). The
Anti-Fraud Account shall consist of such gifts and bequests as
may be made as provided in paragraph (2) and such amounts as may
be deposited in such Anti-Fraud Account as provided in subsection
(b)(4) and title XI of the Social Security Act. It shall also
include the following:
__(A) All criminal fines imposed in cases involving a Federal
health care offense (as defined in subsection (e)).
__(B) Penalties and damages imposed under the False Claims Act
(31 U.S.C. 3729 et seq.), in cases involving claims related to
the provision of health care items and services (other than funds
awarded to a relator or for restitution).
__(C) Administrative penalties and assessments imposed under
titles XI, XVIII and XIX of the Social Security Act and section
5412 (except as otherwise provided by law).
__(D) Amounts resulting from the forfeiture of property by reason
of a Federal health care offense.
Any such funds received on or after the date of the enactment of
this Act shall be deposited in the Anti-Fraud Account.
__(2) Authorization to accept gifts._The Anti-Fraud Account is
authorized to accept on behalf of the United States money gifts
and bequests made unconditionally to the Anti-Fraud Account, for
the benefit of the Anti-Fraud Account, or any activity financed
through the Anti-Fraud Account.

__(b) Use of Funds._
__(1) In general._Amounts in the Anti-Fraud Account shall be
available without appropriation and until expended to assist the
Secretary and Attorney General in carrying out the All-Payer
Health Care Fraud and Abuse Control Program established under
section 5401 (including the administration of the Program), and
may be used to cover costs incurred in operating the Program,
including_
__(A) costs of prosecuting health care matters (through criminal,
civil and administrative proceedings);
__(B) costs of investigations (including equipment, salaries,
administratively uncontrollable work, travel and training of law
enforcement personnel);
__(C) costs of financial and performance audits of health care
programs and operations;
__(D) costs of inspections and other evaluations.
__(2) Funds used to supplement agency appropriations._It is
intended that disbursements made from the Anti-Fraud Account to
any Federal agency be used to increase and not supplant the
recipient agency's appropriated operating budget.
__(c) Annual Report._The Secretary and the Attorney General shall
submit an annual report to Congress on the amount of revenue
which is generated and disbursed by the Anti-Fraud Account in
each fiscal year.
__(d) Federal Health Care Offense Defined._The term ``Federal
health care offense'' means a violation of, or a criminal
conspiracy to violate_
__(1) sections 226, 668, 1033, or 1347 of title 18, United States
Code;
__(2) section 1128B of the Social Security Act;
__(3) sections 287, 371, 664, 666, 1001, 1027, 1341, 1343, or
1954 of title 18, United States Code, if the violation or
conspiracy relates to health care fraud;
__(4) sections 501 or 511 of the Employee Retirement Income
Security Act of 1974, if the violation or conspiracy relates to
health care fraud;
__(5) sections 301, 303(a)(2), or 303(b) or (e) of the Federal
Food Drug and Cosmetic Act, if the violation or conspiracy
relates to health care fraud.
SEC. 5403. USE OF FUNDS BY INSPECTOR GENERAL.
__(a) Reimbursements for Investigations._
__(1) In general._The Inspector General is authorized to receive
and retain for current use reimbursement for the costs of
conducting investigations, when such restitution is ordered by a
court, voluntarily agreed to by the payor, or otherwise.
__(2) Crediting._Funds received by such Office as reimbursement
for costs of conducting investigations shall be deposited to the
credit of such Office appropriation from which initially paid, or
to appropriations for similar purposes currently available at the
time of deposit, and shall remain available for obligation for
365 days from the date of their deposit.
__(3) Exception for forfeitures._This subsection does not apply
to investigative costs paid to such Office from the Health Care
Asset Forfeiture Fund, which monies shall be deposited and
expended in accordance with subsection (b).

__(b) HHS Office of Inspector General Asset Forfeiture Proceeds
Fund._
__(1) In general._There is established in the Treasury of the
United States the ``HHS Office of Inspector General Asset
Forfeiture Proceeds Fund,'' to be administered by the Inspector
General, which shall be available to such Office without fiscal
year limitation for expenses relating to the investigation of
matters within the jurisdiction of such Office.

__(2) Deposits._There shall be deposited in the Fund all proceeds
from forfeitures that have been transferred to the Office of
Inspector General from the Department of Justice Asset Forfeiture
Fund under section 524(d)(1) of title 28, United States Code.

PART 2_APPLICATION OF FRAUD AND ABUSE AUTHORITIES UNDER THE
SOCIAL SECURITY ACT TO ALL PAYERS
SEC. 5411. EXCLUSION FROM PARTICIPATION.
__(a) Mandatory Exclusion._The Secretary shall exclude an
individual or entity from participation in any applicable health
plan if the individual or entity is described in section 1128(a)
of the Social Security Act (relating to individuals and entities
convicted of health care-related crimes or patient abuse).
__(b) Permissive Exclusion._The Secretary may exclude an
individual or entity from participation in any applicable health
plan if the individual or entity is described in section 1128(b)
of the Social Security Act (other than paragraphs (6)(A), (6)(C),
(6)(D), (10), or (13) of such section).
__(c) Notice, Effective Date, and Period of Exclusion._ (1) An
exclusion under this section or section 5412(b)(3) shall be
effective at such time and upon such reasonable notice to the
public and to the individual or entity excluded as may be
specified in regulations consistent with paragraph (2).
__(2) Such an exclusion shall be effective with respect to
services furnished to an individual on or after the effective
date of the exclusion.
__(3)(A) The Secretary shall specify, in the notice of exclusion
under paragraph (1) and the written notice under section 5412 of
this Act, the minimum period (or, in the case of an exclusion of
an individual described in section 1128(b)(12) of the Social
Security Act, the period) of the exclusion.
__(B) In the case of a mandatory exclusion under subsection (a),
the minimum period of exclusion shall be not less than 5 years.
__(C) In the case of an exclusion of an individual described in
paragraph (1), (2), or (3) of section 1128(b) of the Social
Security Act, the period of exclusion shall be a minimum of 3
years, unless the Secretary determines that a longer period is
necessary because of aggravating circumstances.
__(D) In the case of an exclusion of an individual or entity
described in paragraph (4) or (5) of sections 1128(b) of the
Social Security Act, the period of the exclusion shall not be
less than the period during which the individual's or entity's
license to provide health care is revoked, suspended or
surrendered, or the individual or the entity is excluded or
suspended from a Federal or State health care program.
__(E) In the case of an exclusion of an individual or entity
described in paragraph (6)(B) of section 1128(b) of the Social
Security Act, the period of the exclusion shall be not less than
1 year.
__(F) In the case of an exclusion of an individual described in
paragraph (12) of section 1128(b) of the Social Security Act, the
period of the exclusion shall be equal to the sum of_
__(i) the length of the period in which the individual failed to
grant the immediate access described in that paragraph, and
__(ii) an additional period, not to exceed 90 days, set by the
Secretary.
__(d) Notice to Entities Administering Public Programs for the
Delivery of or Payment for Health Care Items or Services._(1) The
Secretary shall exercise the authority under this section in a
manner that results in an individual's or entity's exclusion from
all applicable health plans for the delivery of or payment for
health care items or services.
__(2) The Secretary shall promptly notify each sponsor of an
applicable health plan and each entity that administers a State
health care program described in section 1128(h) of the Social
Security Act of the fact and circumstances of each exclusion
effected against an individual or entity under this section or
under section 5412.

__(e) Notice to State Licensing Agencies._The provisions of
section 1128(e) of the Social Security Act shall apply to this
section in the same manner as such provisions apply to sections
1128 and 1128A of such Act.
__(f) Notice, Hearing, and Judicial Review._(1) Subject to
paragraph (2), any individual or entity that is excluded (or
directed to be excluded) from participation under this section is
entitled to reasonable notice and opportunity for a hearing
thereon by the Secretary to the same extent as is provided in
section 205(b) of the Social Security Act, and to judicial review
of the Secretary's final decision after such hearing as is
provided in section 205(g) of such Act, except that such action
shall be brought in the Court of Appeals of the United States for
the judicial circuit in which the individual or entity resides,
or has a principal place of business, or, if the individual or
entity does not reside or have a principal place of business
within any such judicial circuit, in the United States Court of
Appeals for the District of Columbia Circuit.
__(2) Unless the Secretary determines that the health or safety
of individuals receiving services warrants the exclusion taking
effect earlier, any individual or entity that is the subject of
an adverse determination based on paragraphs (3), (4), (5), (6),
(7), (8), (9), or (14) of section 1128(b) of the Social Security
Act, shall be entitled to a hearing by an administrative law
judge (as provided under section 205(b) of the Social Security
Act) on the determination before any exclusion based upon the
determination takes effect.  If a hearing is requested, the
exclusion shall be effective upon the issuance of an order by the
administrative law judge upholding the determination of the
Secretary to exclude.
__(3) The provisions of section 205(h) of the Social Security Act
shall apply with respect to this section to the same extent as
such provisions apply with respect to title II of such Act.
__(g) Application for Termination of Exclusion._(1) An individual
or entity excluded (or directed to be excluded) from
participation under this section or section 5412(b)(3) may apply
to the Secretary, in the manner specified by the Secretary in
regulations and at the end of the minimum period of exclusion
(or, in the case of an individual or entity described in section
1128(b)(8), the period of exclusion) provided under this section
and a such other times as the Secretary may provide, for
termination of the exclusion.
__(2) The Secretary may terminate the exclusion if the Secretary
determines, on the basis of the conduct of the applicant which
occurred after the date of the notice of exclusion or which was
unknown to the Secretary at the time of the exclusion, that_
__(A) there is no basis under this section or section 5412(b)(3)
for a continuation of the exclusion, and
__(B) there are reasonable assurances that the types of actions
which formed the basis for the original exclusion have not
recurred and will not recur.
__(3) The Secretary shall promptly notify each sponsor of an
applicable health plan entity that administers a State health
care program described in section 1128(h) of the Social Security
Act of each termination of exclusion made under this subsection.
__(h) Convicted Defined._In this section, the term ``convicted''
has the meaning given such term in section 1128(i) of the Social
Security Act.
__(i) Request for Exclusion._The sponsor of any applicable health
plan (including a State in the case of a regional alliance health
plan and the Secretary of Labor in the case of a corporate
alliance health plan) may request that the Secretary of Health
and Human Services exclude an individual or entity with respect
to actions under such a plan in accordance with this section.

SEC. 5412. CIVIL MONETARY PENALTIES.
__(a) Actions Subject to Penalty._Any person who is determined by
the Secretary to have committed any of the following actions with
respect to an applicable health plan shall be subject to a
penalty in accordance with subsection (b):
__(1) Actions subject to penalty under medicare, medicaid, and
other social security health programs._Any action that would
subject the person to a penalty under paragraphs (1) through (12)
of section 1128A of the Social Security Act if the action was
taken with respect to title V, XVIII, XIX or XX of such Act.
__(2) Termination of enrollment._The termination of an
individual's enrollment (including the refusal to re-enroll an
individual) in violation of subtitle E of title I or State law.
__(3) Discriminating on basis of medical condition._The
engagement in any practice that would reasonably be expected to
have the effect of denying or discouraging the initial or
continued enrollment in a health plan by individuals whose
medical condition or history indicates a need for substantial
future medical services.
__(4) Inducing enrollment on false pretenses._The engagement in
any practice to induce enrollment in an applicable health plan
through representations to individuals which the person knows or
should know are false or fraudulent.
__(5) Providing incentives to enroll._The offer or payment of
remuneration to any individual eligible to enroll in an
applicable health plan that such person knows or should know is
likely to influence such individual to enroll in a particular
plan.
__(b) Penalties Described._
__(1) General rule._Any person who the Secretary determines has
committed an action described in paragraphs (2) through (6) of
subsection (a) shall be subject to a civil monetary penalty in an
amount not to exceed $50,000 for each such determination.
__(2) Actions subject to penalties under social security act._In
the case of a person who the Secretary determines has committed
an action described in paragraph (1) of subsection (a), the
person shall be subject to the civil monetary penalty (together
with any additional assessment) to which the person would be
subject under section 1128A of the Social Security Act if the
action on which the determination is based had been committed
with respect to title V, XVIII, XIX or XX of such Act.
__(3) Determinations to exclude permitted._In addition to any
civil monetary penalty imposed under this subsection, the
Secretary may make a determination in the same proceeding to
exclude the person from participation in all applicable health
plans for the delivery of or payment for health care items or
services (in accordance with section 5411(c)).
__(c) Procedures for Imposition of Penalties._
__(1) Applicability of procedures under social security
act._Except as otherwise provided in paragraphs (2) and (3), the
provisions of subsections (c), (d), (e), (g), (j), (k), and (l)
of section 1128A of the Social Security Act shall apply with
respect to the imposition of penalties under this section in the
same manner as such provisions apply with respect to the
imposition of civil monetary penalties under section 1128A of
such Act.
__(2) Limitation on time for attorney general to act._The first
sentence of section 1128A(c) of the Social Security Act shall be
applied with respect to civil monetary penalties under this
section as if the reference in such section to ``one year'' was a
reference to ``60 days''.
__(3) Authority of states to impose penalties._If no proceeding
to impose a civil monetary penalty under this section with
respect to actions relating to a regional alliance health plan
has been initiated (by either the Attorney General or the
Secretary) within 120 days after the Secretary presents a case to
the Attorney General for consideration of the imposition of such
a penalty, the State in which the alliance is located may
initiate proceedings to impose a civil monetary penalty under
this section with respect to the action in the same manner as the
Secretary may initiate such proceedings.
__(d) Treatment of Amounts Recovered._Any amounts recovered under
this section shall be paid to the Secretary and disposed of as
follows:
__(1) Such portions of the amounts recovered as is determined to
have been improperly paid from an applicable health plan for the
delivery of or payment for health care items or services shall be
repaid to such plan.
__(2) The remainder of the amounts recovered shall be deposited
in the All-Payer Health Care Fraud and Abuse Control Account
established under section 5402.

__(e) Notification of Licensing Authorities._Whenever the
Secretary's determination to impose a penalty, assessment, or
exclusion under this section becomes final, the Secretary shall
notify the appropriate State or local licensing agency or
organization (including the agency specified in section 1864(a)
and 1902(a)(33) of the Social Security Act) that such a penalty,
assessment, or exclusion has become final and the reasons
therefor.
SEC. 5413. LIMITATIONS ON PHYSICIAN SELF-REFERRAL.
__The provisions of section 1877 of the Social Security Act shall
apply_
__(1) to items and services (and payments and claims for payment
for such items and services) furnished under any applicable
health plan in the same manner as such provisions apply to
designated health services (and payments and claims for payment
for such services) under title XVIII of the Social Security Act;
and
__(2) to a State (with respect to an item or service furnished or
payment made under a regional alliance health plan) and to the
Secretary of Labor (with respect to a an item or service
furnished or payment made under a corporate alliance health plan)
in the same manner as such provisions apply to the Secretary.
SEC. 5414. CONSTRUCTION OF SOCIAL SECURITY ACT REFERENCES.
__(a) Incorporation of Other Amendments._Any reference in this
part to a provision of the Social Security Act shall be
considered a reference to the provision as amended under title
IV.
__(b) Effect of Subsequent Amendments._Except as provided in
subsection (a), any reference to a provision of the Social
Security Act in this part shall be deemed to be a reference to
such provision as in effect on the date of the enactment of this
Act, and (except as Congress may otherwise provide) any
amendments made to such provisions after such date shall not be
taken into account in determining the applicability of such
provisions to individuals and entities under this Act.

PART 3_AMENDMENTS TO ANTI-FRAUD AND ABUSE PROVISIONS UNDER THE
SOCIAL SECURITY ACT
SEC. 5421. REFERENCE TO AMENDMENTS.
__For provisions amending the anti-fraud and abuse provisions
existing under the Social Security Act, see part 5 of subtitle A
of title IV.
PART 4_AMENDMENTS TO CRIMINAL LAW
SEC. 5431. HEALTH CARE FRAUD.
__(a) In General._Chapter 63 of title 18, United States Code, is
amended by adding at the end the following:
``__1347. Health care fraud
__``(a) Whoever knowingly executes, or attempts to execute, a
scheme or artifice_
__``(1) to defraud any health alliance, health plan, or other
person, in connection with the delivery of or payment for health
care benefits, items, or services;
__``(2) to obtain, by means of false or fraudulent pretenses,
representations, or promises, any of the money or property owned
by, or under the custody or control of, any health alliance,
health plan, or person in connection with the delivery of or
payment for health care benefits, items, or services;
shall be fined under this title or imprisoned not more than 10
years, or both. If the violation results in serious bodily injury
(as defined in section 1365 of this title) such person shall be
imprisoned for life or any term of years.
__``(b) As used in this section, the terms `health alliance' and
`health plan' have the meanings given those terms in title I of
the Health Security Act.''.
 __(b) Clerical Amendment._The table of sections at the beginning
of chapter 63 of title 18, United States Code, is amended by
adding at the end the following:


``1347. Health care fraud.''.
SEC. 5432. FORFEITURES FOR VIOLATIONS OF FRAUD STATUTES.
__(a) In General._Section 982(a) of title 18, United States Code,
is amended by inserting after paragraph (5) the following:
__``(6) If the court determines that a Federal health care
offense (as defined in section 5402(e) of the Health Security
Act) is of a type that poses a serious threat to the health of
any person or has a significant detrimental impact on the health
care system, the court, in imposing sentence on a person
convicted of that offense, shall order that person to forfeit
property, real or personal, that_
__``(A)(i) is used in the commission of the offense; or
__``(ii) constitutes or is derived from proceeds traceable to the
commission of the offense; and
__``(B) is of a value proportionate to the seriousness of the
offense.''.
__(b) Proceeds of Health Care Fraud Forfeitures._Section
524(c)(4)(A) of title 28, United States Code, is amended by
inserting ``all proceeds of forfeitures relating to Federal
health care offenses (as defined in section 5402(e) of the Health
Security Act), and'' after ``except''.
SEC. 5433. FALSE STATEMENTS.
__(a) In General._Chapter 47 of title 18, United States Code, is
amended by adding at the end the following:
``__1033. False statements relating to health care matters
__``(a) Whoever, in any matter involving a health alliance or
health plan, knowingly and willfully falsifies, conceals, or
covers up by any trick, scheme, or device a material fact, or
makes any false, fictitious, or fraudulent statements or
representations, or makes or uses any false writing or document
knowing the same to contain any false, fictitious, or fraudulent
statement or entry, shall be fined under this title or imprisoned
not more than 5 years, or both.
__``(b) As used in this section the terms `health alliance' and
`health plan' have the meanings given those terms in title I of
the Health Security Act.''.
 __(b) Clerical Amendment._The table of sections at the beginning
of chapter 47 of title 18, United States Code, is amended by
adding at the end the following:


``1033. False statements relating to health care matters.''.
SEC. 5434. BRIBERY AND GRAFT.
__(a) In General._Chapter 11 of title 18, United States Code, is
amended by adding at the end the following:
``. Bribery and graft in connection with health care
__``(a) Whoever_
__``(1) directly or indirectly, corruptly gives, offers, or
promises anything of value to a health care official, or offers
or promises a health care official to give anything of value to
any other person, with intent_
__``(A) to influence, or for or because of, any of the health
care official's actions, decisions, or duties relating to a
health alliance or health plan;
__``(B) to influence such an official to commit or aid in the
committing, or collude in or allow, any fraud, or make
opportunity for the commission of any fraud, on a health alliance
or health plan, or for or because of any such conduct on the part
of such an official; or
__``(C) to induce such an official to engage in any conduct in
violation of the lawful duty of such official, or for or because
of such conduct; or
__``(2) being a health care official, directly or indirectly,
corruptly demands, seeks, receives, accepts, or agrees to accept
anything of value personally or for any other person or entity,
the giving of which violates paragraph (1) of this subsection.
__``(b) As used in this section_
__``(1) the term `health care official' means_
__``(A) an administrator, officer, trustee, fiduciary, custodian,
counsel, agent, or employee of any health care alliance or health
plan;
__``(B) an officer, counsel, agent, or employee, of an
organization that provides services under contract to any health
alliance or health plan;
__``(C) an official or employee of a State agency having
regulatory authority over any health alliance or health plan;
__``(D) an officer, counsel, agent, or employee of a health care
sponsor; and
__``(2) the term `health care sponsor' means any individual or
entity serving as the sponsor of a health alliance or health plan
for purposes of the Health Security Act, and includes the joint
board of trustees or other similar body used by two or more
employers to administer a health alliance or health plan for
purposes of such Act.''.
__(b) Clerical Amendment._The table of chapters at the beginning
of chapter 11 of title 18, United States Code, is amended by
adding at the end the following:


`` Bribery and graft in connection with health care.''.
SEC. 5435. INJUNCTIVE RELIEF RELATING TO HEALTH CARE OFFENSES.
__Section 1345(a)(1) of title 18, United States Code, is amended_
__(1) by striking ``or'' at the end of subparagraph (A);
__(2) by inserting ``or'' at the end of subparagraph (B); and
__(3) by adding at the end the following:
__``(C) committing or about to commit a Federal health care
offense (as defined in section 5402(e) of the Health Security
Act);''.
SEC. 5436. GRAND JURY DISCLOSURE.
__Section 3322 of title 18, United States Code, is amended_
__(1) by redesignating subsections (c) and (d) as subsections (d)
and (e), respectively; and
__(2) by inserting after subsection (b) the following:
__``(c) A person who is privy to grand jury information
concerning a health law violation_
__``(1) received in the course of duty as an attorney for the
Government; or
__``(2) disclosed under rule 6(e)(3)(A)(ii) of the Federal Rules
of Criminal Procedure;
may disclose that information to an attorney for the Government
to use in any civil proceeding related to a Federal health care
offense (as defined in section 5402(e) of the Health Security
Act), or for use in connection with civil forfeiture under
section 981(a)(1)(C) of this title.''.
SEC. 5437. THEFT OR EMBEZZLEMENT.
__(a) In General._Chapter 31 of title 18, United States Code, is
amended by adding at the end the following:
``__668. Theft or embezzlement in connection with health care
__``(a) Whoever embezzles, steals, willfully and unlawfully
converts to the use of any person other than the rightful owner,
or intentionally misapplies any of the moneys, securities,
premiums, credits, property, or other assets of a health
alliance, health plan, or of any fund connected with such an
alliance or plan, shall be fined under this title or imprisoned
not more than 10 years, or both.
__``(b) As used in this section, the terms `health alliance' and
`health plan' have the meanings given those terms under title I
of the Health Security Act.''.
 __(b) Clerical Amendment._The table of sections at the beginning
of chapter 31 of title 18, United States Code, is amended by
adding at the end the following:


``668. Theft or embezzlement in connection with health care.''.

SEC. 5438. MISUSE OF HEALTH SECURITY CARD OR UNIQUE IDENTIFIER.
__(a) In General._Chapter 33 of title 18, United States Code, is
amended by adding at the end the following new section:
`` Misuse of health security card or unique identifier
__``Whoever_
__``(1) requires the display of, requires the use of, or uses a
health security card that is issued under section 1001(b) of the
American Health Security Act for any purpose other than a purpose
described in section 5105(a) of such Act; or
__``(2) requires the disclosure of, requires the use of, or uses
a unique identifier number provided pursuant to section 5104 of
such Act for any purpose that is not authorized by the National
Health Board pursuant to such section;
shall be fined under this title or imprisoned not more than 2
years, or both.''.
__(b) Clerical Amendments to Table of Sections._The table of
sections at the beginning of chapter 33, United States Code, is
amended_
__(1) by amending the catchline to read as follows:
``CHAPTER 33_EMBLEMS, INSIGNIA, IDENTIFIERS, AND NAMES'';
and
__(2) by adding at the end the following new item:

``_Misuse of health security card or unique identifier.''.

__(c) Clerical Amendment to Table of Chapters._The item relating
to chapter 33 in the table of chapters at the beginning of part 1
of title 18, United States Code, is amended to read as follows:


``Emblems, insignia, identifiers, and names''.

PART 5_AMENDMENTS TO CIVIL FALSE CLAIMS ACT
SEC. 5441. AMENDMENTS TO CIVIL FALSE CLAIMS ACT.
__Section 3729 of title 31, United States Code, is amended_
__(1) in subsection (a)(7), by inserting ``or to a health plan,''
after ``property to the Government,'';
__(2) in the matter following subsection (a)(7), by inserting
``or health plan'' before ``sustains because of the act of that
person,'' ;
__(3) at the end of the first sentence of subsection (a), by
inserting ``or health plan'' before ``sustains because of the act
of the person.'' ;
__(4) in subsection (c)_
__(A) by inserting ``the term'' after ``section,''; and
__(B) by adding at the end the following: ``The term also
includes any request or demand, whether under contract of
otherwise, for money or property which is made or presented to a
health plan.'' ; and
__(5) by adding at the end the following:
__``(f) Health Plan Defined._For purposes of this section, the
term `health plan' has the meaning given such term under section
1400 of the Health Security Act.''.

Title V, Subtitle F
Subtitle F_McCarran-Ferguson Reform
SEC. 5501. REPEAL OF EXEMPTION FOR HEALTH INSURANCE.
__(a) In General._Section 3 of the Act of March 9, 1945 (15
U.S.C. 1013), known as the McCarran-Ferguson Act, is amended by
adding at the end the following:
__``(c) Notwithstanding that the business of insurance is
regulated by State law, nothing in this Act shall limit the
applicability of the following Acts to the business of insurance
to the extent that such business relates to the provision of
health benefits:
__``(1) The Sherman Act (15 U.S.C. 1 et seq.).
__``(2) The Clayton Act (15 U.S.C. 12 et seq.).
__``(3) Federal Trade Commission Act (15 U.S.C. 41 et seq.).
__``(4) The Act of June 19, 1936 (49 Stat. 1526; 15 U.S.C. 21a et
seq.), known as the Robinson-Patman Antidiscrimination Act.''.
__(b) Effective Date._The amendment made by subsection (a) shall
take effect on the first day of the sixth month beginning after
the date of the enactment of this Act.