Patient Protection and Affordable Care Act/Title I/Subtitle C

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Patient Protection and Affordable Care Act
United States Congress
Title I - Quality, Affordable Health Care for All Americans
Subtitle C - Quality Health Insurance Coverge for All Americans

Subtitle C--Quality Health Insurance Coverage for All Americans[edit]

PART I--HEALTH INSURANCE MARKET REFORMS[edit]

SEC. 1201. AMENDMENT TO THE PUBLIC HEALTH SERVICE ACT.[edit]

Part A of title XXVII of the Public Health Service Act (42 U.S.C. 300gg et seq.), as amended by section 1001, is further amended--

(1) by striking the heading for subpart 1 and inserting the following:
`Subpart I--General Reform';
(2)(A) in section 2701 (42 U.S.C. 300gg), by striking the section heading and subsection (a) and inserting the following:
`SEC. 2704. PROHIBITION OF PREEXISTING CONDITION EXCLUSIONS OR OTHER DISCRIMINATION BASED ON HEALTH STATUS.
`(a) In General- A group health plan and a health insurance issuer offering group or individual health insurance coverage may not impose any preexisting condition exclusion with respect to such plan or coverage.'; and
(B) by transferring such section (as amended by subparagraph (A)) so as to appear after the section 2703 added by paragraph (4);
(3)(A) in section 2702 (42 U.S.C. 300gg-1)--
(i) by striking the section heading and all that follows through subsection (a);
(ii) in subsection (b)--
(I) by striking `health insurance issuer offering health insurance coverage in connection with a group health plan' each place that such appears and inserting `health insurance issuer offering group or individual health insurance coverage'; and
(II) in paragraph (2)(A)--
(aa) by inserting `or individual' after `employer'; and
(bb) by inserting `or individual health coverage, as the case may be' before the semicolon; and
(iii) in subsection (e)--
(I) by striking `(a)(1)(F)' and inserting `(a)(6)';
(II) by striking `2701' and inserting `2704'; and
(III) by striking `2721(a)' and inserting `2735(a)'; and
(B) by transferring such section (as amended by subparagraph (A)) to appear after section 2705(a) as added by paragraph (4); and
(4) by inserting after the subpart heading (as added by paragraph (1)) the following:
`SEC. 2701. FAIR HEALTH INSURANCE PREMIUMS.
`(a) Prohibiting Discriminatory Premium Rates-
`(1) IN GENERAL- With respect to the premium rate charged by a health insurance issuer for health insurance coverage offered in the individual or small group market--
`(A) such rate shall vary with respect to the particular plan or coverage involved only by--
`(i) whether such plan or coverage covers an individual or family;
`(ii) rating area, as established in accordance with paragraph (2);
`(iii) age, except that such rate shall not vary by more than 3 to 1 for adults (consistent with section 2707(c)); and
`(iv) tobacco use, except that such rate shall not vary by more than 1.5 to 1; and
`(B) such rate shall not vary with respect to the particular plan or coverage involved by any other factor not described in subparagraph (A).
`(2) RATING AREA-
`(A) IN GENERAL- Each State shall establish 1 or more rating areas within that State for purposes of applying the requirements of this title.
`(B) SECRETARIAL REVIEW- The Secretary shall review the rating areas established by each State under subparagraph (A) to ensure the adequacy of such areas for purposes of carrying out the requirements of this title. If the Secretary determines a State's rating areas are not adequate, or that a State does not establish such areas, the Secretary may establish rating areas for that State.
`(3) PERMISSIBLE AGE BANDS- The Secretary, in consultation with the National Association of Insurance Commissioners, shall define the permissible age bands for rating purposes under paragraph (1)(A)(iii).
`(4) APPLICATION OF VARIATIONS BASED ON AGE OR TOBACCO USE- With respect to family coverage under a group health plan or health insurance coverage, the rating variations permitted under clauses (iii) and (iv) of paragraph (1)(A) shall be applied based on the portion of the premium that is attributable to each family member covered under the plan or coverage.
`(5) SPECIAL RULE FOR LARGE GROUP MARKET- If a State permits health insurance issuers that offer coverage in the large group market in the State to offer such coverage through the State Exchange (as provided for under section 1312(f)(2)(B) of the Patient Protection and Affordable Care Act), the provisions of this subsection shall apply to all coverage offered in such market in the State.
`SEC. 2702. GUARANTEED AVAILABILITY OF COVERAGE.
`(a) Guaranteed Issuance of Coverage in the Individual and Group Market- Subject to subsections (b) through (e), each health insurance issuer that offers health insurance coverage in the individual or group market in a State must accept every employer and individual in the State that applies for such coverage.
`(b) Enrollment-
`(1) RESTRICTION- A health insurance issuer described in subsection (a) may restrict enrollment in coverage described in such subsection to open or special enrollment periods.
`(2) ESTABLISHMENT- A health insurance issuer described in subsection (a) shall, in accordance with the regulations promulgated under paragraph (3), establish special enrollment periods for qualifying events (under section 603 of the Employee Retirement Income Security Act of 1974).
`(3) REGULATIONS- The Secretary shall promulgate regulations with respect to enrollment periods under paragraphs (1) and (2).
`SEC. 2703. GUARANTEED RENEWABILITY OF COVERAGE.
`(a) In General- Except as provided in this section, if a health insurance issuer offers health insurance coverage in the individual or group market, the issuer must renew or continue in force such coverage at the option of the plan sponsor or the individual, as applicable.
`SEC. 2705. PROHIBITING DISCRIMINATION AGAINST INDIVIDUAL PARTICIPANTS AND BENEFICIARIES BASED ON HEALTH STATUS.
`(a) In General- A group health plan and a health insurance issuer offering group or individual health insurance coverage may not establish rules for eligibility (including continued eligibility) of any individual to enroll under the terms of the plan or coverage based on any of the following health status-related factors in relation to the individual or a dependent of the individual:
`(1) Health status.
`(2) Medical condition (including both physical and mental illnesses).
`(3) Claims experience.
`(4) Receipt of health care.
`(5) Medical history.
`(6) Genetic information.
`(7) Evidence of insurability (including conditions arising out of acts of domestic violence).
`(8) Disability.
`(9) Any other health status-related factor determined appropriate by the Secretary.
`(j) Programs of Health Promotion or Disease Prevention-
`(1) GENERAL PROVISIONS-
`(A) GENERAL RULE- For purposes of subsection (b)(2)(B), a program of health promotion or disease prevention (referred to in this subsection as a `wellness program') shall be a program offered by an employer that is designed to promote health or prevent disease that meets the applicable requirements of this subsection.
`(B) NO CONDITIONS BASED ON HEALTH STATUS FACTOR- If none of the conditions for obtaining a premium discount or rebate or other reward for participation in a wellness program is based on an individual satisfying a standard that is related to a health status factor, such wellness program shall not violate this section if participation in the program is made available to all similarly situated individuals and the requirements of paragraph (2) are complied with.
`(C) CONDITIONS BASED ON HEALTH STATUS FACTOR- If any of the conditions for obtaining a premium discount or rebate or other reward for participation in a wellness program is based on an individual satisfying a standard that is related to a health status factor, such wellness program shall not violate this section if the requirements of paragraph (3) are complied with.
`(2) WELLNESS PROGRAMS NOT SUBJECT TO REQUIREMENTS- If none of the conditions for obtaining a premium discount or rebate or other reward under a wellness program as described in paragraph (1)(B) are based on an individual satisfying a standard that is related to a health status factor (or if such a wellness program does not provide such a reward), the wellness program shall not violate this section if participation in the program is made available to all similarly situated individuals. The following programs shall not have to comply with the requirements of paragraph (3) if participation in the program is made available to all similarly situated individuals:
`(A) A program that reimburses all or part of the cost for memberships in a fitness center.
`(B) A diagnostic testing program that provides a reward for participation and does not base any part of the reward on outcomes.
`(C) A program that encourages preventive care related to a health condition through the waiver of the copayment or deductible requirement under group health plan for the costs of certain items or services related to a health condition (such as prenatal care or well-baby visits).
`(D) A program that reimburses individuals for the costs of smoking cessation programs without regard to whether the individual quits smoking.
`(E) A program that provides a reward to individuals for attending a periodic health education seminar.
`(3) WELLNESS PROGRAMS SUBJECT TO REQUIREMENTS- If any of the conditions for obtaining a premium discount, rebate, or reward under a wellness program as described in paragraph (1)(C) is based on an individual satisfying a standard that is related to a health status factor, the wellness program shall not violate this section if the following requirements are complied with:
`(A) The reward for the wellness program, together with the reward for other wellness programs with respect to the plan that requires satisfaction of a standard related to a health status factor, shall not exceed 30 percent of the cost of employee-only coverage under the plan. If, in addition to employees or individuals, any class of dependents (such as spouses or spouses and dependent children) may participate fully in the wellness program, such reward shall not exceed 30 percent of the cost of the coverage in which an employee or individual and any dependents are enrolled. For purposes of this paragraph, the cost of coverage shall be determined based on the total amount of employer and employee contributions for the benefit package under which the employee is (or the employee and any dependents are) receiving coverage. A reward may be in the form of a discount or rebate of a premium or contribution, a waiver of all or part of a cost-sharing mechanism (such as deductibles, copayments, or coinsurance), the absence of a surcharge, or the value of a benefit that would otherwise not be provided under the plan. The Secretaries of Labor, Health and Human Services, and the Treasury may increase the reward available under this subparagraph to up to 50 percent of the cost of coverage if the Secretaries determine that such an increase is appropriate.
`(B) The wellness program shall be reasonably designed to promote health or prevent disease. A program complies with the preceding sentence if the program has a reasonable chance of improving the health of, or preventing disease in, participating individuals and it is not overly burdensome, is not a subterfuge for discriminating based on a health status factor, and is not highly suspect in the method chosen to promote health or prevent disease.
`(C) The plan shall give individuals eligible for the program the opportunity to qualify for the reward under the program at least once each year.
`(D) The full reward under the wellness program shall be made available to all similarly situated individuals. For such purpose, among other things:
`(i) The reward is not available to all similarly situated individuals for a period unless the wellness program allows--
`(I) for a reasonable alternative standard (or waiver of the otherwise applicable standard) for obtaining the reward for any individual for whom, for that period, it is unreasonably difficult due to a medical condition to satisfy the otherwise applicable standard; and
`(II) for a reasonable alternative standard (or waiver of the otherwise applicable standard) for obtaining the reward for any individual for whom, for that period, it is medically inadvisable to attempt to satisfy the otherwise applicable standard.
`(ii) If reasonable under the circumstances, the plan or issuer may seek verification, such as a statement from an individual's physician, that a health status factor makes it unreasonably difficult or medically inadvisable for the individual to satisfy or attempt to satisfy the otherwise applicable standard.
`(E) The plan or issuer involved shall disclose in all plan materials describing the terms of the wellness program the availability of a reasonable alternative standard (or the possibility of waiver of the otherwise applicable standard) required under subparagraph (D). If plan materials disclose that such a program is available, without describing its terms, the disclosure under this subparagraph shall not be required.
`(k) Existing Programs- Nothing in this section shall prohibit a program of health promotion or disease prevention that was established prior to the date of enactment of this section and applied with all applicable regulations, and that is operating on such date, from continuing to be carried out for as long as such regulations remain in effect.
`(l) Wellness Program Demonstration Project-
`(1) IN GENERAL- Not later than July 1, 2014, the Secretary, in consultation with the Secretary of the Treasury and the Secretary of Labor, shall establish a 10-State demonstration project under which participating States shall apply the provisions of subsection (j) to programs of health promotion offered by a health insurance issuer that offers health insurance coverage in the individual market in such State.
`(2) EXPANSION OF DEMONSTRATION PROJECT- If the Secretary, in consultation with the Secretary of the Treasury and the Secretary of Labor, determines that the demonstration project described in paragraph (1) is effective, such Secretaries may, beginning on July 1, 2017 expand such demonstration project to include additional participating States.
`(3) REQUIREMENTS-
`(A) MAINTENANCE OF COVERAGE- The Secretary, in consultation with the Secretary of the Treasury and the Secretary of Labor, shall not approve the participation of a State in the demonstration project under this section unless the Secretaries determine that the State's project is designed in a manner that--
`(i) will not result in any decrease in coverage; and
`(ii) will not increase the cost to the Federal Government in providing credits under section 36B of the Internal Revenue Code of 1986 or cost-sharing assistance under section 1402 of the Patient Protection and Affordable Care Act.
`(B) OTHER REQUIREMENTS- States that participate in the demonstration project under this subsection--
`(i) may permit premium discounts or rebates or the modification of otherwise applicable copayments or deductibles for adherence to, or participation in, a reasonably designed program of health promotion and disease prevention;
`(ii) shall ensure that requirements of consumer protection are met in programs of health promotion in the individual market;
`(iii) shall require verification from health insurance issuers that offer health insurance coverage in the individual market of such State that premium discounts--
`(I) do not create undue burdens for individuals insured in the individual market;
`(II) do not lead to cost shifting; and
`(III) are not a subterfuge for discrimination;
`(iv) shall ensure that consumer data is protected in accordance with the requirements of section 264(c) of the Health Insurance Portability and Accountability Act of 1996 (42 U.S.C. 1320d-2 note); and
`(v) shall ensure and demonstrate to the satisfaction of the Secretary that the discounts or other rewards provided under the project reflect the expected level of participation in the wellness program involved and the anticipated effect the program will have on utilization or medical claim costs.
`(m) Report-
`(1) IN GENERAL- Not later than 3 years after the date of enactment of the Patient Protection and Affordable Care Act, the Secretary, in consultation with the Secretary of the Treasury and the Secretary of Labor, shall submit a report to the appropriate committees of Congress concerning--
`(A) the effectiveness of wellness programs (as defined in subsection (j)) in promoting health and preventing disease;
`(B) the impact of such wellness programs on the access to care and affordability of coverage for participants and non-participants of such programs;
`(C) the impact of premium-based and cost-sharing incentives on participant behavior and the role of such programs in changing behavior; and
`(D) the effectiveness of different types of rewards.
`(2) DATA COLLECTION- In preparing the report described in paragraph (1), the Secretaries shall gather relevant information from employers who provide employees with access to wellness programs, including State and Federal agencies.
`(n) Regulations- Nothing in this section shall be construed as prohibiting the Secretaries of Labor, Health and Human Services, or the Treasury from promulgating regulations in connection with this section.
`SEC. 2706. NON-DISCRIMINATION IN HEALTH CARE.
`(a) Providers- A group health plan and a health insurance issuer offering group or individual health insurance coverage shall not discriminate with respect to participation under the plan or coverage against any health care provider who is acting within the scope of that provider's license or certification under applicable State law. This section shall not require that a group health plan or health insurance issuer contract with any health care provider willing to abide by the terms and conditions for participation established by the plan or issuer. Nothing in this section shall be construed as preventing a group health plan, a health insurance issuer, or the Secretary from establishing varying reimbursement rates based on quality or performance measures.
`(b) Individuals- The provisions of section 1558 of the Patient Protection and Affordable Care Act (relating to non-discrimination) shall apply with respect to a group health plan or health insurance issuer offering group or individual health insurance coverage.
`SEC. 2707. COMPREHENSIVE HEALTH INSURANCE COVERAGE.
`(a) Coverage for Essential Health Benefits Package- A health insurance issuer that offers health insurance coverage in the individual or small group market shall ensure that such coverage includes the essential health benefits package required under section 1302(a) of the Patient Protection and Affordable Care Act.
`(b) Cost-sharing Under Group Health Plans- A group health plan shall ensure that any annual cost-sharing imposed under the plan does not exceed the limitations provided for under paragraphs (1) and (2) of section 1302(c).
`(c) Child-only Plans- If a health insurance issuer offers health insurance coverage in any level of coverage specified under section 1302(d) of the Patient Protection and Affordable Care Act, the issuer shall also offer such coverage in that level as a plan in which the only enrollees are individuals who, as of the beginning of a plan year, have not attained the age of 21.
`(d) Dental Only- This section shall not apply to a plan described in section 1302(d)(2)(B)(ii)(I).
`SEC. 2708. PROHIBITION ON EXCESSIVE WAITING PERIODS.
`A group health plan and a health insurance issuer offering group or individual health insurance coverage shall not apply any waiting period (as defined in section 2704(b)(4)) that exceeds 90 days.'.

PART II--OTHER PROVISIONS[edit]

SEC. 1251. PRESERVATION OF RIGHT TO MAINTAIN EXISTING COVERAGE.[edit]

(a) No Changes to Existing Coverage-
(1) IN GENERAL- Nothing in this Act (or an amendment made by this Act) shall be construed to require that an individual terminate coverage under a group health plan or health insurance coverage in which such individual was enrolled on the date of enactment of this Act.
(2) CONTINUATION OF COVERAGE- With respect to a group health plan or health insurance coverage in which an individual was enrolled on the date of enactment of this Act, this subtitle and subtitle A (and the amendments made by such subtitles) shall not apply to such plan or coverage, regardless of whether the individual renews such coverage after such date of enactment.
(b) Allowance for Family Members To Join Current Coverage- With respect to a group health plan or health insurance coverage in which an individual was enrolled on the date of enactment of this Act and which is renewed after such date, family members of such individual shall be permitted to enroll in such plan or coverage if such enrollment is permitted under the terms of the plan in effect as of such date of enactment.
(c) Allowance for New Employees To Join Current Plan- A group health plan that provides coverage on the date of enactment of this Act may provide for the enrolling of new employees (and their families) in such plan, and this subtitle and subtitle A (and the amendments made by such subtitles) shall not apply with respect to such plan and such new employees (and their families).
(d) Effect on Collective Bargaining Agreements- In the case of health insurance coverage maintained pursuant to one or more collective bargaining agreements between employee representatives and one or more employers that was ratified before the date of enactment of this Act, the provisions of this subtitle and subtitle A (and the amendments made by such subtitles) shall not apply until the date on which the last of the collective bargaining agreements relating to the coverage terminates. Any coverage amendment made pursuant to a collective bargaining agreement relating to the coverage which amends the coverage solely to conform to any requirement added by this subtitle or subtitle A (or amendments) shall not be treated as a termination of such collective bargaining agreement.
(e) Definition- In this title, the term `grandfathered health plan' means any group health plan or health insurance coverage to which this section applies.

SEC. 1252. RATING REFORMS MUST APPLY UNIFORMLY TO ALL HEALTH INSURANCE ISSUERS AND GROUP HEALTH PLANS.[edit]

Any standard or requirement adopted by a State pursuant to this title, or any amendment made by this title, shall be applied uniformly to all health plans in each insurance market to which the standard and requirements apply. The preceding sentence shall also apply to a State standard or requirement relating to the standard or requirement required by this title (or any such amendment) that is not the same as the standard or requirement but that is not preempted under section 1321(d).

SEC. 1253. EFFECTIVE DATES.[edit]

This subtitle (and the amendments made by this subtitle) shall become effective for plan years beginning on or after January 1, 2014.