,,ii #aaeth ,,congress #ast ,session ,s4 #bbb ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,january #bd1 #bjag ,mr4 ,paul introduced the following bill2 which was read twice and referred to the ,committee on ,finance ,a ,,bill ,to repeal provisions of the ,patient ,protection and ,affordable ,care ,act and provide private health insurance reform1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,obamacare ,replacement ,act4 #b4 ,table of contents ,the table of contents for this ,act is as follows3 ,sec4 #a4 ,short title4 ,sec4 #b4 ,table of contents4 ,,title ,i--,repeals ,sec4 #aja4 ,repeal of individual and employer mandates4 ,sec4 #ajb4 ,repeal of ,public ,health ,service ,act provisions4 ,sec4 #ajc4 ,repeal of ,patient ,protection and ,affordable ,care ,act provisions4 ,sec4 #ajd4 ,conforming and technical amendments4 ,,title ,,ii--,taxation reform ,subtitle ,a--,equalizing tax treatment of non-,employer provided health insurance ,sec4 #bja4 ,tax deduction for health insurance premiums4 ,sec4 #bjb4 ,refundable tax credit for payroll taxes attributable to health insurance premiums4 ,subtitle ,b--,health savings accounts ,sec4 #baa4 ,repeal of contribution limitations4 ,sec4 #bab4 ,freedom from mandate4 ,sec4 #bac4 ,allowance of distributions for prescription and over-the-counter medicines and drugs4 ,sec4 #bad4 ,purchase of health insurance from ,,hsa4 ,sec4 #bae4 ,special rule for certain medical expenses incurred before establishment of account4 ,sec4 #baf4 ,administrative error correction before due date of return4 ,sec4 #bag4 ,allowing ,,hsa rollover to child or parent of account holder4 ,sec4 #bah4 ,credit for contributions to an ,,hsa4 ,sec4 #bai4 ,equivalent bankruptcy protections for health savings accounts as retirement funds4 ,subtitle ,c--,medical expenses ,sec4 #bba4 ,certain exercise equipment and physical fitness programs treated as medical care4 ,sec4 #bbb4 ,certain nutritional and dietary supplements to be treated as medical care4 ,sec4 #bbc4 ,certain provider fees to be treated as medical care4 ,sec4 #bbd4 ,clarification of treatment of capitated primary care payments as amounts paid for medical care4 ,subtitle ,d--,miscellaneous ,sec4 #bca4 ,contributions of medicare beneficiaries participating in medicare advantage ,,msa4 ,sec4 #bcb4 ,physician charity and uncompensated care deduction4 ,,title ,,iii--,individual health insurance reform ,sec4 #cja4 ,pool reform for individual membership expansion4 ,sec4 #cjb4 ,cooperative governing of individual health insurance coverage4 ,,title ,,iv--,association health plans ,sec4 #dja4 ,rules governing association health plans4 ,sec4 #djb4 ,clarification of treatment of single employer arrangements4 ,sec4 #djc4 ,enforcement provisions relating to association health plans4 ,sec4 #djd4 ,cooperation between ,federal and ,state authorities4 ,sec4 #dje4 ,effective date and transitional and other rules4 ,,title ,v--,medicaid reform ,sec4 #eja4 ,increasing ,state flexibility to conduct ,medicaid waivers4 ,,title ,,vi--,miscellaneous provisions ,sec4 #fja4 ,quality health care coalition4 ,sec4 #fjb4 ,certain medical stop-loss insurance obtained by certain plan sponsors of group health plans not included under the definition of health insurance coverage4 ,i ,repeals #aja4 ,repeal of individual and employer mandates 7a7 ,repeal of individual mandate ,section #ejjj;,a of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following3 7h7 ,termination ,this section shall not apply with respect to any month beginning after the date of enactment of the ,obamacare ,replacement ,act4 4 7b7 ,repeal of employer mandate ,section #dihj;,h of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following3 7e7 ,termination ,this section shall not apply with respect to any month beginning after the date of enactment of the ,obamacare ,replacement ,act4 4 #ajb4 ,repeal of ,public ,health ,service ,act provisions 7a7 ,repeal ,the following provisions of title ,,xxvii of the ,public ,health ,service ,act 7#db ,u4,s4,c4 #cjj;gg et seq47 are repealed3 7#a7 ,section #bgja 7#db ,u4,s4,c4 #cjj;gg74 7#b7 ,section #bgjb 7#db ,u4,s4,c4 #cjj;gg-#a74 7#c7 ,section #bgjc 7#db ,u4,s4,c4 #cjj;gg-#b74 7#d7 ,section #bgjd 7#db ,u4,s4,c4 #cjj;gg-#c74 7#e7 ,section #bgje 7#db ,u4,s4,c4 #cjj;gg-#d74 7#f7 ,section #bgjg 7#db ,u4,s4,c4 #cjj;gg-#f74 7#g7 ,section #bgjh 7#db ,u4,s4,c4 #cjj;gg-#g74 7#h7 ,section #bgaa 7#db ,u4,s4,c4 #cjj;gg-#aa74 7#i7 ,section #bgab 7#db ,u4,s4,c4 #cjj;gg-#ab74 7#aj7 ,section #bgac 7#db ,u4,s4,c4 #cjj;gg-#ac74 7#aa7 ,section #bgae 7#db ,u4,s4,c4 #cjj;gg-#ae74 7#ab7 ,section #bgae;,a 7#db ,u4,s4,c4 #cjj;gg-#ae;a74 7#ac7 ,section #bgaf 7#db ,u4,s4,c4 #cjj;gg-#af74 7#ad7 ,section #bgah 7#db ,u4,s4,c4 #cjj;gg-#ah74 7#ae7 ,section #bgai 7#db ,u4,s4,c4 #cjj;gg-#ai74 7#af7 ,section #bgai;,a 7#db ,u4,s4,c4 #cjj;gg-#ai;a74 7#ag7 ,section #bgid 7#db ,u4,s4,c4 #cjj;gg-#id71 relating to ensuring that consumers get value for their dollars4 7b7 ,reinstating pre-,,ppaca law ,sections #bgja1 #bgjb1 #bgaa1 and #bgab of the ,public ,health ,service ,act as in effect on the day before the date of enactment of the ,patient ,protection and ,affordable ,care ,act 7,public ,law #aaa-adh7 shall be restored or revived as if such ,act had not been enacted 7subject to paragraphs 7#a71 7#b71 7#f71 and 7#g7 of subsection 7c774 7c7 ,redesignations and transfers ,the following provisions of title ,,xxvii of the ,public ,health ,service ,act 7#db ,u4,s4,c4 #cjj;gg et seq47 shall be redesignated and transferred as follows3 7#a7 ,section #bgja1 as restored or revived under subsection 7b71 shall be transferred so as to appear as the first section in subpart ,i of part ,a4 7#b7 ,section #bgjb1 as restored or revived under subsection 7b71 shall be transferred so as to appear after such section #bgja4 7#c7 ,section #bgjf 7#db ,u4,s4,c4 #cjj;gg-#e7 shall be redesignated as section #bgjc and transferred so as to appear after such section #bgjb4 7#d7 ,section #bgji 7#db ,u4,s4,c4 #cjj;gg-#h71 relating to coverage for individuals participating in approved clinical trials1 shall be redesignated as section #bgjd and transferred so as to appear after section #bgjc 7as so redesignated74 7#e7 ,section #bgji 7#db ,u4,s4,c4 #cjj;gg-#i71 relating to disclosure of information1 shall be redesignated as section #bgje and transferred so as to appear after section #bgjd 7as so redesignated74 7#f7 ,section #bgaa1 as restored or revived under subsection 7b71 shall be redesignated as section #bgjf and transferred so as to appear after section #bgje 7as so redesignated74 7#g7 ,section #bgab1 as restored or revived under subsection 7b71 shall be redesignated as section #bgjg and transferred so as to appear after section #bgjf 7as so redesignated74 7#h7 ,section #bgad 7#db ,u4,s4,c4 #cjj;gg-#ad7 shall be redesignated as section #bgaa and transferred so as to appear as the first section under subpart ,,ii of part ,a4 7#i7 ,section #bgag 7#db ,u4,s4,c4 #cjj;gg-#ag7 shall be redesignated as section #bgab and transferred so as to appear after section #bgaa 7as so redesignated74 7d7 ,effective dates 7#a7 ,in general ,except as provided in paragraph 7#b71 the repeals under subsection 7a7 shall take effect on the date of enactment of this ,act and shall apply to plan years beginning after such date of enactment4 7#b7 ,delayed effective dates ,the repeals under paragraphs 7#b71 7#c71 7#d71 and 7#e7 of subsection 7a71 the provisions restored or revived under subsection 7b71 and the conforming amendment in section #ajd7;a77#b7 shall be effective for plan years beginning on ,january #a1 #bjai1 and 7notwithstanding subsection 7c77 the provisions of law repealed by such paragraphs of subsection 7a7 or amended by such conforming amendment shall continue to remain in effect until such date4 #ajc4 ,repeal of ,patient ,protection and ,affordable ,care ,act provisions 7a7 ,in general ,section #acab7;c7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjcb7;c77 is repealed4 7b7 ,repeal of #c-,month grace period for non-payment premiums ,clause 7iv7 of section #adab7;c77#b77;,b7 of the ,patient ,protection and ,affordable ,care ,act is amended by striking nonpayment of premiums by the insured and all that follows and inserting nonpayment of premiums by the insured1 notify the ,secretary of such nonpayment44 7c7 ,effective date ,this section1 and the amendments made by this section1 shall take effect on the date of enactment of this ,act and shall apply to plan years and taxable years beginning after such date of enactment4 #ajd4 ,conforming and technical amendments 7a7 ,,phsa provisions ,title ,,xxvii of the ,public ,health ,service ,act 7#db ,u4,s4,c4 #cjj;gg et seq47 is amended-- 7#a7 in section #bgbd7;c7 7#db ,u4,s4,c4 #cjj;gg-#bc7;c771 by striking 7other than section #bgjd7 and inserting 7other than section #bgbe72 7#b7 in section #bgda7;b77#c7 7#db ,u4,s4,c4 #cjj;gg-#da7;a77#c771 by striking #bgab and inserting #bgjg2 7#c7 in section #bgea7;a7 7#db ,u4,s4,c4 #cjj;gg-#ea7;a771 by striking #bgjd and inserting #bgbe2 7#d7 in section #bgeb 7#db ,u4,s4,c4 #cjj;gg-#eb71 by striking #bgjf and inserting #bgbg2 and 7#e7 in section #bgec 7#db ,u4,s4,c4 #cjj;gg-#ed71 relating to coverage of dependent students on medically necessary leave of absence1 by striking #bgjg and inserting #bgbh4 7b7 ,,ppaca provisions ,the ,patient ,protection and ,affordable ,care ,act 7,public ,law #aaa-adh7 is amended-- 7#a7 in section #aajc7;b77#a7 7#db ,u4,s4,c4 #ahjjc7;b77#a77-- 7,a7 by striking the percentage of total premium revenue expended on nonclinical costs 7as reported under section #bgah7;a7 of the ,public ,health ,service ,act712 and 7,b7 by striking and be consistent with the standards adopted for the uniform explanation of coverage as provided for in section #bgae of the ,public ,health ,service ,act2 7#b7 in section #abea7;a7 7#db ,u4,s4,c4 #ahjaa7;a771 by striking paragraphs 7#c7 and 7#d71 and inserting the following3 7#c7 ,application of certain provisions ,section #bgaa of the ,public ,health ,service ,act 7relating to extension of dependent coverage7 shall apply to grandfathered health plans for plan years beginning with the first plan year to which such provisions would otherwise apply4 2 7#c7 in section #acja7;a77#d7 7#db ,u4,s4,c4 #ahjba7;a77#d771 by striking section #bgja7;a77#b7 of the ,public ,health ,service ,act and inserting section #bgja7;a77#b7 of the ,public ,health ,service ,act as in effect on the day before the date of enactment of the ,obamacare ,replacement ,act or as determined by the ,secretary2 7#d7 in section #acjb7;e77#a77;,b77i7 7#db ,u4,s4,c4 #ahjbb7;e77#a77;,b77i771 by striking 7except as provided for in section #bgac72 7#e7 in section #acaa 7#db ,u4,s4,c4 #ahjca7-- 7,a7 in subsection 7c7-- 7i7 in paragraph 7#a77;,b71 by striking 7in a manner consistent with applicable network adequacy provisions under section #bgjb7;c7 of the ,public ,health ,service ,act72 and 7ii7 in paragraph 7#e71 by striking to the uniform outline of coverage the plan is required to provide under section #bgaf of the ,public ,health ,service ,act and2 7,b7 in subsection 7d77#d77;,e71 by striking 1 including the use of the uniform outline of coverage established under section #bgae of the ,public ,health ,service ,act2 7,c7 in subsection 7e77#b71 by striking 1 and the information and the recommendations and all that follows through premium increases712 and 7,d7 in subsection 7f77#b77;,b71 by inserting before the period as in effect on the day before the date of enactment of the ,obamacare ,replacement ,act or as determined by the ,secretary2 and 7#f7 in section #accd7;a77#b71 by inserting before the period as in effect on the day before the date of enactment of the ,obamacare ,replacement ,act4 7c7 ,,erisa provisions ,section #gae of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #aahe;d7 is amended-- 7#a7 in subsection 7a7-- 7,a7 by striking 7a7 ,general ,rule and all that follows through the provisions of part ,a in paragraph 7#a7 and inserting ,the provisions of part ,a2 and 7,b7 by striking as if included in this subpart2 and in paragraph 7#a7 and all that follows through to the extent that in paragraph 7#b7 and inserting as if included in this subpart4 ,to the extent that2 and 7#b7 by striking subsection 7b74 7d7 ,,irc provisions ,the ,internal ,revenue ,code of #aihf is amended-- 7#a7 in section #cf;,b7b77#c77;,c7-- 7,a7 in the first sentence1 by striking and the premium was adjusted only for the age of each such individual in the manner allowed under section #bgja of the ,public ,health ,service ,act2 and 7,b7 by striking the second sentence2 7#b7 in section #hcc7;c71 by striking paragraph 7#e72 and 7#c7 in section #ihae-- 7,a7 in subsection 7a7-- 7i7 by striking 7a7 ,general ,rule and all that follows through the provisions of part ,a in paragraph 7#a7 and inserting ,the provisions of part ,a2 and 7ii7 by striking as if included in this subpart2 and in paragraph 7#a7 and all that follows through to the extent that in paragraph 7#b7 and inserting as if included in this subpart4 ,to the extent that2 and 7,b7 by striking subsection 7b74 7e7 ,social ,security ,act ,section #aicg7;b77#f77;,a7 of the ,social ,security ,act 7#db ,u4,s4,c4 #acifu-#g7;b77#f77;,a77 is amended by striking #bgje7;a7 and inserting #bgbf7;a74 7f7 ,effective date ,except as provided in section #ajb7;d77#b71 this section and the amendments made by this section shall take effect on the date of enactment of this ,act and shall apply to plan years and taxable years beginning after such date of enactment4 ,,ii ,taxation reform ,a ,equalizing tax treatment of non-,employer provided health insurance #bja4 ,tax deduction for health insurance premiums 7a7 ,in general ,part ,,vii of subchapter ,b of chapter #a of the ,internal ,revenue ,code of #aihf is amended by redesignating section #bbd as section #bbe and by inserting after section #bbb the following new section3 #bbd4 ,health insurance premiums 7a7 ,in general ,there shall be allowed as a deduction the amount of premiums paid by the taxpayer for health insurance coverage 7as defined in section #ihcb7 of the taxpayer1 the taxpayer's spouse1 or any dependent 7as defined in section #aeb1 determined without regard to subsections 7b77#a71 7b77#b71 and 7d77#a77;,b7 thereof7 of the taxpayer4 7b7 ,coordination provisions 7#a7 ,premium assistance credit ,subsection 7a7 shall not apply with respect to so much of any premium for which a credit has been allowed under section #cf;,b4 7#b7 ,archer ,m,s,as and ,h,s,as ,subsection 7a7 shall not apply with respect to any amount which is treated as a qualified medical expense under either section #bbj7;d7 or #bbc7;c74 7#c7 ,deduction for medical expenses ,for purposes of determining the amount of the deduction under section #bac1 any amount for which a deduction is allowed under subsection 7a7 shall not be treated as an expense paid for medical care4 4 7b7 ,deduction available above the line ,section #fb7;a7 of the ,internal ,revenue ,code of #aihf is amended by inserting after paragraph 7#ba7 the following new paragraph3 7#bb7 ,health insurance premiums ,the deduction allowed by section #bbd4 4 7c7 ,conforming amendments 7#a7 ,section #ce7;g77#b7 of the ,internal ,revenue ,code of #aihf is amended by striking or #bac and inserting #bac1 or #bbd4 7#b7 ,section #afb7l77#c7 of such ,code is amended by inserting or #bbd7;a7 after #bac7;a74 7#c7 ,the table of sections for part ,,vii of subchapter ,b of chapter #a of such ,code is amended by redesignating the item relating to section #bbd as relating to section #bbe and by inserting after the item relating to section #bbc the following new item3 ,sec4 #bbd4 ,health insurance premiums4 4 7d7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjaf4 #bjb4 ,refundable tax credit for payroll taxes attributable to health insurance premiums 7a7 ,in general ,subpart ,c of part ,,iv of subchapter ,a of chapter #a of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new section3 #cf;,c4 ,refund of payroll taxes attributable to health insurance premiums 7a7 ,allowance of credit ,there shall be allowed as a credit against the tax imposed by this subtitle for any taxable year an amount equal to the applicable percentage of the premiums paid by the taxpayer for health insurance coverage 7as defined in section #ihcb7 of the taxpayer1 the taxpayer's spouse1 or any dependent 7as defined in section #aeb1 determined without regard to subsections 7b77#a71 7b77#b71 and 7d77#a77;,b7 thereof7 of the taxpayer4 7b7 ,applicable percentage ,for purposes of subsection 7a71 the term applicable percentage means the percentage equal to the sum of the rates of in effect under subsections 7a7 and 7b7 of section #caja4 7c7 ,limitation ,the amount of the credit allowed under subsection 7a7 shall not exceed the excess of-- 7#a7 the social security taxes 7as defined in section #bd7;d77 of the taxpayer for the taxable year1 reduced by 7#b7 the sum of the credits allowed under section #bd7;d7 and #cb for the taxable year4 4 7b7 ,conforming amendments 7#a7 ,paragraph 7#b7 of section #acbd7;b7 of title #ca1 ,united ,states ,code1 is amended by inserting 1 #cf;,c after #cf;,b4 7#b7 ,the table of sections for subpart ,c of part ,,iv of subchapter ,a of chapter #a of the ,internal ,revenue ,code of #aihf is amended by inserting after the item relating to section #cf;,b the following new item3 ,sec4 #cf;,c4 ,refund of payroll taxes attributable to health insurance premiums4 4 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjaf4 ,b ,health savings accounts #baa4 ,repeal of contribution limitations 7a7 ,in general ,subsection 7b7 of section #bbc of the ,internal ,revenue ,code of #aihf is amended to read as follows3 7b7 ,denial of deduction to dependents ,no deduction shall be allowed under this section to any individual with respect to whom a deduction under section #aea is allowable to another taxpayer for a taxable year beginning in the calendar year in which such individual's taxable year begins4 4 7b7 ,conforming amendments 7#a7 ,subparagraph 7,a7 of section #bbc7;d77#a7 of the ,internal ,revenue ,code of #aihf is amended-- 7,a7 by striking subsection 7f77#e7 and inserting subsection 7f77#d71 and 7,b7 by striking accepted-- and all that follows and inserting accepted unless it is in cash44 7#b7 ,subsection 7f7 of section #bbc of such ,code is amended by striking paragraph 7#c7 and by redesignating paragraphs 7#d7 through 7#h7 as paragraphs 7#c7 through 7#g71 respectively4 7#c7 ,subsection 7g7 of section #bbc of such ,code is amended-- 7,a7 by striking subsections 7b77#b7 and 7c77#b77;,a7 both places it appears and inserting subsection 7c77#b77;,a71 and 7,b7 by amending subparagraph 7,b7 to read as follows3 7,b7 the cost-of-living adjustment determined under section #a7;f77#c7 for the calendar year in which such taxable year begins determined by substituting calendar year #bjjc for calendar year #aiib4 4 7#d7 ,section #bf7;b77#b7 of such ,code is amended-- 7,a7 by striking 1 #bbc7;b77#h77;,b77i77,,ii71 in subparagraph 7,s71 and 7,b7 by striking #bbc7;f77#d7 in subparagraph 7,u7 and inserting #bbc7;f77#c74 7#e7 ,paragraph 7#a7 of section #ajf7;d7 of such ,code is amended by striking under an accident or health plan and all that follows and inserting under an accident or health plan44 7#f7 ,subparagraph 7,c7 of section #ajf7;e77#d7 of such ,code is amended by striking #bbc7;f77#e7 and inserting #bbc7;f77#d74 7#g7 ,subparagraph 7,c7 of section #djh7;d77#i7 of such ,code is amended-- 7,a7 by striking ,limitations4-- in the heading and all that follows through 7ii7 ,one-time transfer4-- in clause 7ii71 and inserting ,one-time transfer4--1 7,b7 by redesignating subclauses 7,i7 and 7,,ii7 as clauses 7i7 and 7ii7 and moving such clauses #b ems to the left1 and 7,c7 by striking subclause 7,,ii7 in clause 7i71 as so redesignated1 and inserting clause 7ii74 7#h7 ,section #digc of such ,code is amended by striking subsection 7g7 and by redesignating subsection 7h7 as subsection 7g74 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after the date of the enactment of this ,act4 #bab4 ,freedom from mandate 7a7 ,in general ,section #bbc of the ,internal ,revenue ,code of #aihf1 as amended by section #baa1 is further amended by striking subsections 7c7 and 7g7 and by redesignating subsections 7d71 7e71 7f71 and 7h7 as subsections 7c71 7d71 7e71 and 7f71 respectively4 7b7 ,conforming amendments 7#a7 ,subsection 7a7 of section #bbc of the ,internal ,revenue ,code of #aihf is amended to read as follows3 7a7 ,deduction allowed ,in the case of an individual1 there shall be allowed as a deduction for the taxable year an amount equal to the aggregate amount paid in cash during such taxable year by or on behalf of such individual to a health savings account of such individual4 4 7#b7 ,subsection 7c77#a77;,a7 of section #bbc of such ,code1 as amended by section #baa and redesignated by subsection 7a71 is further amended by striking subsection 7f77#d7 and inserting subsection 7e77#d74 7#c7 ,subparagraph 7,u7 of section #bf7;b77#b7 of such ,code1 as amended by section #baa1 is further amended by striking section #bbc7;f77#c7 and inserting section #bbc7;e77#c74 7#d7 ,sections #ce7;g77#c71 #bbj7;f77#e77;,a71 #hdh7;e77#a77;,b77v71 #digc7;a77#e71 and #fjea7;a77#ab7 of such ,code are each amended by striking section #bbc7;d7 each place it appears and inserting section #bbc7;c74 7#e7 ,section #ajf7;d77#a7 of such ,code is amended-- 7,a7 by striking who is an eligible individual 7as defined in section #bbc7;c77#a771 and 7,b7 by striking section #bbc7;d7 and inserting section #bbc7;c74 7#f7 ,section #ajf7;e7 of such ,code is amended-- 7,a7 by striking paragraphs 7#c7 and 7#d7 and by redesignating paragraph 7#e7 as paragraph 7#d71 7,b7 by inserting after paragraph 7#b7 the following new paragraph3 7#c7 ,treatment as rollover contribution ,a qualified ,,hsa distribution shall be treated as a rollover contribution described in section #bbc7;e77#d74 1 and 7,c7 by striking to any eligible individual covered under a high deductible health plan of the employer in paragraph 7#d77;,b77ii7 7as so redesignated7 and inserting to any employee with respect to whom a health savings account has been established4 7#g7 ,section #djh7;d77#i77;,a7 of such ,code is amended by striking who is an eligible individual 7as defined in section #bbc7;c77 and4 7#h7 ,section #hgg;,a7g77#f7 of such ,code is amended by striking #bbc7;f77#d7 and inserting #bbc7;e77#d74 7#i7 ,section #dige of such ,code is amended-- 7,a7 in subsection 7c77#f7-- 7i7 by striking section #bbc7;d7 and inserting section #bbc7;c71 and 7ii7 by striking section #bbc7;e77#b7 and inserting section #bbc7;d77#b71 and 7,b7 in subsection 7e77#a77;,e71 by striking section #bbc7;d7 and inserting section #bbc7;c74 7#aj7 ,subsection 7b7 of section #dihj;,g of such ,code is amended to read as follows3 7b7 ,rules and requirements 7#a7 ,in general ,an employer meets the requirements of this subsection for any calendar year if the employer makes available comparable contributions to the health savings accounts of all comparable participating employees for each coverage period during such calendar year4 7#b7 ,comparable contributions 7,a7 ,in general ,for purposes of paragraph 7#a71 the term comparable contributions means contributions-- 7i7 which are the same amount1 or 7ii7 if the employees are covered by a health plan1 which are the same percentage of the annual deductible limit under the plan covering the employees4 7,b7 ,part-year employees ,in the case of an employee who is employed by the employer for only a portion of the calendar year1 a contribution to the health savings account of such employee shall be treated as comparable if it is an amount which bears the same ratio to the comparable amount 7determined without regard to this subparagraph7 as such portion bears to the entire calendar year4 7#c7 ,comparable participating employees ,for purposes of paragraph 7#a71 the term comparable participating employees means all employees who are covered 7if at all7 under the same health plan of the employer and have the same category of coverage4 ,for purposes of the preceding sentence1 the categories of coverage are self-only and family coverage4 7#d7 ,part-time employees 7,a7 ,in general ,paragraph 7#c7 shall be applied separately with respect to part-time employees and other employees4 7,b7 ,part-time employee ,for purposes of subparagraph 7,a71 the term part-time employee means any employee who is customarily employed for fewer than #cj hours per week4 4 7#aa7 ,section #dihj;,g7d7 of such ,code is amended by striking section #dihj;,e and inserting this section4 7#ab7 ,section #ffic7;a77#b77;,c7 of such ,code is amended by striking section #bbc7;h7 and inserting section #bbc7;f74 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after the date of the enactment of this ,act4 #bac4 ,allowance of distributions for prescription and over-the-counter medicines and drugs 7a7 ,h,s,as ,paragraph 7#b77;,a7 of section #bbc7;c7 of the ,internal ,revenue ,code of #aihf1 as redesignated by section #bab1 is amended by striking the last sentence thereof and inserting the following3 ,such term shall include an amount paid for any prescription or over-the-counter medicine or drug44 7b7 ,archer ,m,s,as ,section #bbj7;d77#b77;,a7 of the ,internal ,revenue ,code of #aihf is amended by striking the last sentence thereof and inserting the following3 ,such term shall include an amount paid for any prescription or over-the-counter medicine or drug44 7c7 ,health flexible spending arrangements and health reimbursement arrangements ,subsection 7f7 of section #ajf of the ,internal ,revenue ,code of #aihf is amended to read as follows3 7f7 ,reimbursements for all medicines and drugs ,for purposes of this section and section #aje1 reimbursement for expenses incurred for any prescription or over-the-counter medicine or drug shall be treated as a reimbursement for medical expenses4 4 7d7 ,effective dates 7#a7 ,distributions from savings accounts ,the amendments made by subsections 7a7 and 7b7 shall apply to amounts paid in taxable years beginning after the date of the enactment of this ,act4 7#b7 ,reimbursements ,the amendment made by subsection 7c7 shall apply to expenses incurred in plan years beginning after the date of the enactment of this ,act4 #bad4 ,purchase of health insurance from ,,hsa 7a7 ,in general ,paragraph 7#b7 of section #bbc7;c7 of the ,internal ,revenue ,code of #aihf1 as redesignated by section #bab1 is amended by striking subparagraphs 7,b7 and 7,c74 7b7 ,conforming amendment ,paragraph 7#b7 of section #bbc7;c7 of the ,internal ,revenue ,code of #aihf1 as amended by the preceding sections of this subtitle1 is further amended by striking and any dependent 7as defined in section #aeb1 determined without regard to subsections 7b77#a71 7b77#b71 and 7d77#a77;,b7 thereof7 of such individual and inserting any dependent 7as defined in section #aeb1 determined without regard to subsections 7b77#a71 7b77#b71 and 7d77#a77;,b7 thereof7 of such individual1 and any child 7as defined in section #aeb7;f77#a77 of such individual who has not attained the age of #bg before the end of such individual's taxable year4 7c7 ,effective date ,the amendments made by this section shall apply with respect to insurance purchased after the date of the enactment of this ,act in taxable years beginning after such date4 #bae4 ,special rule for certain medical expenses incurred before establishment of account 7a7 ,in general ,paragraph 7#b7 of section #bbc7;c7 of the ,internal ,revenue ,code of #aihf1 as amended and redesignated by the preceding sections of this subtitle1 is further amended by adding at the end the following new subparagraph3 7,b7 ,certain medical expenses incurred before establishment of account treated as qualified ,an expense shall not fail to be treated as a qualified medical expense solely because such expense was incurred before the establishment of the health savings account if such expense was incurred-- 7i7 during either-- 7,i7 the taxable year in which the health savings account was established1 or 7,,ii7 the preceding taxable year1 in the case of a health savings account established after the taxable year in which such expense was incurred but before the time prescribed by law for filing the return for such taxable year 7not including extensions thereof71 and 7ii7 for medical care which 7but for the fact that it was incurred before the establishment of the account7 otherwise meets the requirements of the preceding subparagraphs4 4 7b7 ,effective date ,the amendment made by this section shall apply to taxable years beginning after the date of the enactment of this ,act4 #baf4 ,administrative error correction before due date of return 7a7 ,in general ,paragraph 7#c7 of section #bbc7;f7 of the ,internal ,revenue ,code of #aihf1 as in effect on the day before the date of the enactment of this ,act1 is amended by adding at the end the following new subparagraph3 7,d7 ,exception for administrative errors corrected before due date of return ,subparagraph 7,a7 shall not apply if any payment or distribution is made to correct an administrative1 clerical1 or payroll contribution error and if-- 7i7 such distribution is received by the individual on or before the last day prescribed by law 7including extensions of time7 for filing such individual's return for such taxable year1 and 7ii7 such distribution is accompanied by the amount of net income attributable to such contribution4 ,any net income described in clause 7ii7 shall be included in the gross income of the individual for the taxable year in which it is received4 4 7b7 ,effective date ,the amendment made by this section shall take effect on the date of the enactment of this ,act4 #bag4 ,allowing ,,hsa rollover to child or parent of account holder 7a7 ,in general ,paragraph 7#g77;,a7 of section #bbc7;e7 of the ,internal ,revenue ,code of #aihf1 as redesignated by the preceding sections of this subtitle1 is amended-- 7#a7 by inserting 1 child1 parent1 or grandparent after surviving spouse1 7#b7 by inserting 1 child1 parent1 or grandparent1 as the case may be1 after the spouse1 7#c7 by inserting 1 child1 parent1 or grandparent after spouse in the heading thereof1 and 7#d7 by adding at the end the following3 ,in the case of a child who acquires such beneficiary's interest and with respect to whom a deduction under section #aea is allowable to another taxpayer for a taxable year beginning in the calendar year in which such individual's taxable year begins1 such health savings account shall be treated as a health savings account of such child44 7b7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after the date of the enactment of this ,act4 #bah4 ,credit for contributions to an ,,hsa 7a7 ,in general ,subpart ,a of part ,,iv of subchapter ,a of chapter #a of the ,internal ,revenue ,code of #aihf is amended by inserting after section #be;,d the following new section3 #be;,e4 ,contributions to a health savings account 7a7 ,allowance of credit ,in the case of an individual1 there shall be allowed as a credit against the tax imposed by this subtitle for the taxable year an amount equal to so much of the qualified ,,hsa contributions of the individual as does not exceed #e1jjj 7#aj1jjj in the case of a joint return74 7b7 ,qualified ,,hsa contribution 7#a7 ,in general ,for purposes of this section1 the term qualified ,,hsa contribution means an amount paid in cash during the taxable year by or on behalf of an individual to a health savings account 7as defined in section #bbc7;c77 of such individual4 7#b7 ,exception for amounts not used for qualified medical expenses ,the amount taken into account as qualified ,,hsa contributions of the individual under paragraph 7#a7 for a taxable year shall be reduced by the amount of any distribution from such health savings account during such taxable year which is not used exclusively to pay the qualified medical expenses of the account beneficiary 7within the meaning of section #bbc7;e77#b774 7c7 ,coordination with deduction ,for coordination rule1 see section #bbc7;b77#a74 4 7b7 ,clerical amendment ,the table of sections for subpart ,a of part ,,iv of subchapter ,a of chapter #a of the ,internal ,revenue ,code of #aihf is amended by inserting after the item relating to section #be;,d the following new item3 ,sec4 #be;,e4 ,contributions to a health savings account4 4 7c7 ,conforming amendment ,subsection 7b7 of section #bbc of the ,internal ,revenue ,code of #aihf1 as amended by section #baa1 is further amended to read as follows3 7b7 ,special rules 7#a7 ,coordination with credit ,the amount taken into account under subsection 7a7 with respect to any individual shall be reduced 7but not below zero7 by the amount of any credit allowed under section #be;,e for qualified ,,hsa contributions with respect to the individual4 7#b7 ,denial of deduction to dependents ,no deduction shall be allowed under this section to any individual with respect to whom a deduction under section #aea is allowable to another taxpayer for a taxable year beginning in the calendar year in which such individual's taxable year begins4 4 7d7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after the date of the enactment of this ,act4 #bai4 ,equivalent bankruptcy protections for health savings accounts as retirement funds 7a7 ,in general ,section #ebb of title #aa1 ,united ,states ,code1 is amended by adding at the end the following new subsection3 7r7 ,treatment of health savings accounts ,for purposes of this section1 any health savings account 7as described in section #bbc of the ,internal ,revenue ,code of #aihf7 shall be treated in the same manner as an individual retirement account described in section #djh of such ,code4 4 7b7 ,effective date ,the amendment made by this section shall apply to cases commencing under title #aa1 ,united ,states ,code1 after the date of the enactment of this ,act4 ,c ,medical expenses #bba4 ,certain exercise equipment and physical fitness programs treated as medical care 7a7 ,in general ,subsection 7d7 of section #bac of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new paragraph3 7#ab7 ,exercise equipment and physical fitness activity 7,a7 ,in general ,the term medical care shall include amounts paid-- 7i7 for equipment for use in a program 7including a self-directed program7 of physical exercise or physical activity1 7ii7 to participate1 or receive instruction1 in a program of physical exercise1 nutrition1 or health coaching 7including a self-directed program71 and 7iii7 for membership at a fitness facility4 7,b7 ,overall dollar limitation 7i7 ,in general ,amounts treated as medical care under subparagraph 7,a7 shall not exceed #a1jjj with respect to any individual for any taxable year4 7ii7 ,exception ,clause 7i7 shall not apply for purposes of determining whether expenses reimbursed through a health flexible spending arrangement subject to section #abe7;i77#a7 are incurred for medical care4 7,c7 ,limitations related to sports and fitness equipment ,amounts paid for equipment described in subparagraph 7,a77i7 shall be treated as medical care only-- 7i7 if such equipment is utilized exclusively for participation in fitness1 exercise1 sport1 or other physical activity programs1 7ii7 if such equipment is not apparel or footwear1 and 7iii7 in the case of any item of sports equipment 7other than exercise equipment71 to the extent the amount paid for such item does not exceed #bej4 7,d7 ,fitness facility ,for purposes of subparagraph 7,a77iii71 the term fitness facility means a facility-- 7i7 which provides instruction in a program of physical exercise1 offers facilities for the preservation1 maintenance1 encouragement1 or development of physical fitness1 or serves as the site of such a program of a ,state or local government1 7ii7 which is not a private club owned and operated by its members1 7iii7 which does not offer golf1 hunting1 sailing1 or riding facilities1 7iv7 whose health or fitness facility is not incidental to its overall function and purpose1 and 7v7 which is fully compliant with the ,state of jurisdiction and ,federal anti-discrimination laws4 4 7b7 ,limitation not ,to apply for certain purposes 7#a7 ,health savings accounts ,subparagraph 7,a7 of section #bbc7;c77#b7 of the ,internal ,revenue ,code of #aihf1 as amended and redesignated by subtitle ,b1 is further amended by inserting 1 determined without regard to paragraph 7#ab77;,b7 thereof7 after medical care 7as defined in section #bac7;d74 7#b7 ,archer ,m,s,as ,subparagraph 7,a7 of section #bbj7;d77#b7 of the ,internal ,revenue ,code of #aihf1 as amended by subtitle ,b1 is further amended by inserting 1 determined without regard to paragraph 7#ab77;,b7 thereof after medical care 7as defined in section #bac7;d74 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after the date of the enactment of this ,act4 #bbb4 ,certain nutritional and dietary supplements to be treated as medical care 7a7 ,in general ,subsection 7d7 of section #bac of the ,internal ,revenue ,code of #aihf1 as amended by section #bba1 is further amended by adding at the end the following new paragraph3 7#ac7 ,nutritional and dietary supplements 7,a7 ,in general ,the term medical care shall include amounts paid to purchase herbs1 vitamins1 minerals1 homeopathic remedies1 meal replacement products1 and other dietary and nutritional supplements4 7,b7 ,limitation ,amounts treated as medical care under subparagraph 7,a7 shall not exceed #a1jjj with respect to any individual for any taxable year4 7,c7 ,meal replacement product ,for purposes of this paragraph1 the term meal replacement product means any product that-- 7i7 is permitted to bear labeling making a claim described in section #djc7r77#c7 of the ,federal ,food1 ,drug1 and ,cosmetic ,act1 and 7ii7 is permitted to claim under such section that such product is low in fat and is a good source of protein1 fiber1 and multiple essential vitamins and minerals4 7,d7 ,exception ,subparagraph 7,b7 shall not apply for purposes of determining whether expenses reimbursed through a health flexible spending arrangement subject to section #abe7;i77#a7 are incurred for medical care4 4 7b7 ,limitation not ,to apply for certain purposes 7#a7 ,health savings accounts ,subparagraph 7,a7 of section #bbc7;c77#b7 of the ,internal ,revenue ,code of #aihf1 as amended and redesignated by this ,act1 is amended by striking paragraph 7#ab77;,b7 and inserting paragraphs 7#ab77;,b7 and 7#ac77;,b74 7#b7 ,archer ,m,s,as ,subparagraph 7,a7 of section #bbj7;d77#b71 as amended by this ,act1 is amended by striking paragraph 7#ab77;,b7 and inserting paragraphs 7#ab77;,b7 and 7#ac77;,b74 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after the date of the enactment of this ,act4 #bbc4 ,certain provider fees to be treated as medical care 7a7 ,in general ,subsection 7d7 of section #bac of the ,internal ,revenue ,code of #aihf1 as amended by sections #bba and #bbb1 is amended by adding at the end the following new paragraph3 7#ad7 ,periodic provider fees ,the term medical care shall include-- 7,a7 periodic fees paid to a primary care physician for a defined set of medical services or the right to receive medical services on an as-needed basis1 and 7,b7 pre-paid primary care services designed to screen for1 diagnose1 cure1 mitigate1 treat1 or prevent disease and promote wellness4 4 7b7 ,exception for flexible spending accounts ,section #abe of the ,internal ,revenue ,code of #aihf is amended by redesignating subsections 7k7 and 7l7 as subsections 7l7 and 7m71 respectively1 and by inserting after subsection 7j7 the following new subsection3 7k7 ,special rule with respect to health flexible spending arrangements ,for purposes of applying this section with respect to any health flexible spending arrangement1 amounts described in section #bac7;d77#ad7 shall not be considered insurance4 4 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after the date of the enactment of this ,act4 #bbd4 ,clarification of treatment of capitated primary care payments as amounts paid for medical care 7a7 ,in general ,subsection 7d7 of section #bac of the ,internal ,revenue ,code of #aihf1 as amended by the preceding provisions of this ,act1 is amended by adding at the end the following new paragraph3 7#ae7 ,treatment of capitated primary care payments ,capitated primary care payments shall be treated as amounts paid for medical care4 4 7b7 ,effective date ,the amendment made by this section shall apply to taxable years beginning after the date of the enactment of this ,act4 ,d ,miscellaneous #bca4 ,contributions of medicare beneficiaries participating in medicare advantage ,,msa 7a7 ,in general ,section #ach7;b7 of the ,internal ,revenue ,code of #aihf is amended by striking paragraph 7#b7 and by redesignating paragraphs 7#c7 and 7#d7 as paragraphs 7#b7 and 7#c71 respectively4 7b7 ,effective date ,the amendment made by this section shall apply to taxable years beginning after the date of the enactment of this ,act4 #bcb4 ,physician charity and uncompensated care deduction 7a7 ,in general ,part ,,vi of subchapter ,b of chapter #a of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new section3 #aii;,a4 ,physician charity and uncompensated care 7a7 ,in general ,in the case of a physician1 there shall be allowed as a deduction for the taxable year an amount equal to the sum of-- 7#a7 the amount such physician would have otherwise charged for qualified charity care provided by such physician during such taxable year1 and 7#b7 the amount of any debt owed to such physician for physicians' services which becomes worthless during such taxable year4 7b7 ,definitions ,for purposes of this section-- 7#a7 ,physician ,the term physician has the meaning given to such term in section #ahfa7r7 of the ,social ,security ,act 7#db ,u4,s4,c4 #aciex7r774 7#b7 ,qualified charity care ,the term qualified charity care means physicians' services provided on a volunteer or pro bono basis 7not including any services for which an amount was charged but not paid74 7#c7 ,physicians' services ,the term physicians' services has the meaning given such term in section #ahfa7q7 of the ,social ,security ,act 7#db ,u4,s4,c4 #aciex7q774 7c7 ,limitations 7#a7 ,service charge limitation ,the amount determined under subsection 7a7 with respect to any services or debt-- 7,a7 shall be reduced by any reimbursement received by the physician for such services or debt1 and 7,b7 shall not exceed the economic index referred to in the fourth sentence of section #ahdb7;b77#c7 of the ,social ,security ,act 7#db ,u4,s4,c4 #acieu7b77#c77 applicable to the qualified charity care provided or the services provided with respect to which the debt relates4 ,in the case of physicians' services to which such economic index is not applicable1 the ,secretary1 in consultation with the ,secretary of ,health and ,human ,services1 shall use data on uncompensated care for purposes of the limitation under subparagraph 7,b71 and may adjust such data so as to be an appropriate proxy1 including 7in the case of qualified charity care7 a downward adjustment to eliminate bad debt data from uncompensated care data4 7#b7 ,overall limitation ,the amount allowed as a deduction under subsection 7a7 for any taxable year shall not exceed an amount equal to #aj percent of the gross income of the taxpayer for the taxable year derived from the taxpayer's provision of physicians' services4 7d7 ,denial of double benefit ,no deduction shall be allowed under section #aff or any other provision of this title for the amount of any bad debt taken into account under subsection 7a77#b7 7as reduced1 if applicable1 under subsection 7c774 4 7b7 ,clerical amendment ,the table of sections for part ,,vi of subchapter ,b of chapter #a of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new item3 ,sec4 #aii;,a4 ,physician charity and uncompensated care4 4 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after the date of the enactment of this ,act4 ,,iii ,individual health insurance reform #cja4 ,pool reform for individual membership expansion ,the ,public ,health ,service ,act is amended by inserting after title ,,xxxiii the following new title3 ,,xxxiv ,pool ,reform for ,individual ,membership ,expansion #cdjj4 ,purpose ,the purpose of this title is to provide1 through the establishment of independent health pools 7referred to in this title as ,,ihp71 for the reform of1 and expansion of enrollment in1 health insurance coverage for individuals and small employers4 #cdja4 ,definition of independent health pool 7a7 ,in ,general ,for purposes of this title1 the terms individual health pool and ,,ihp mean a legal nonprofit entity that meets the following requirements3 7#a7 ,organization ,the ,,ihp-- 7,a7 has been formed and maintained in good faith for a purpose that includes the formation of a risk pool in order to offer health insurance coverage to its members2 7,b7 does not condition membership in the ,,ihp on any health status-related factor relating to an individual 7including an employee of an employer or a dependent of an employee72 7,c7 does not make health insurance coverage offered through the ,,ihp available other than in connection with a member of the ,,ihp2 7,d7 is not a health insurance issuer2 and 7,e7 does not receive any consideration directly or indirectly from any health insurance issuer in connection with the enrollment of any individuals1 or employees of employers1 in any health insurance coverage1 except in conjunction with services offered through the ,,ihp4 7#b7 ,offering health benefits coverage 7,a7 ,different groups ,the ,,ihp1 in conjunction with those health insurance issuers that offer health benefits coverage through the ,,ihp1 makes available health benefits coverage in the manner described in subsection 7b7 to all members of the ,,ihp and the dependents of such members 7and1 in the case of small employers1 employees and their dependents7 in the manner described in subsection 7c77#b7 at rates that are established by the health insurance issuer on a policy or product specific basis and that may vary for individuals covered through an ,,ihp4 7,b7 ,nondiscrimination in coverage offered 7i7 ,in general ,subject to clause 7ii71 the ,,ihp may not offer health benefits coverage to a member of an ,,ihp unless the same coverage is offered to all such members of the ,,ihp4 7ii7 ,construction ,nothing in this title shall be construed as requiring or permitting a health insurance issuer to provide coverage outside the service area of the issuer1 as approved under ,state law1 or preventing a health insurance issuer from underwriting or from excluding or limiting the coverage on any individual1 subject to the requirement of section #bgda 7relating to guaranteed availability of individual health insurance coverage to certain individuals with prior group coverage74 7,c7 ,no assumption of insurance risk by ,,ihp ,the ,,ihp provides health benefits coverage only through contracts with health insurance issuers and does not assume insurance risk with respect to such coverage4 7#c7 ,geographic areas ,nothing in this title shall be construed as preventing the establishment and operation of more than one ,,ihp in a geographic area or as limiting the number of ,i,h,ps that may operate in any area4 7#d7 ,provision of administrative services to purchasers ,the ,,ihp may provide administrative services for members4 ,such services may include accounting1 billing1 and enrollment information4 7b7 ,health benefits coverage requirements 7#a7 ,compliance with consumer protection requirements ,except as provided in section #cdjb1 any health benefits coverage offered through an ,,ihp-- 7,a7 shall be issued by a health insurance issuer that meets all applicable ,state standards relating to consumer protection2 7,b7 shall be approved or otherwise permitted to be offered under ,state law2 and 7,c7 may not impose any exclusion of a specific disease from such coverage4 7#b7 ,wellness bonuses for health promotion ,nothing in this title shall be construed as precluding a health insurance issuer offering health benefits coverage through an ,,ihp from establishing premium discounts or rebates for members or from modifying otherwise applicable copayments or deductibles in return for adherence to programs of health promotion and disease prevention so long as such programs are agreed to in advance by the ,,ihp and comply with all other provisions of this title and do not discriminate among similarly situated members4 7c7 ,members2 health insurance issuers 7#a7 ,members 7,a7 ,in general ,under rules established to carry out this title1 with respect to an individual or small employer who is a member of an ,,ihp1 the individual may enroll for health benefits coverage 7including coverage for dependents of such individual7 or the employer may enroll employees for health benefits coverage 7including coverage for dependents of such employees7 offered by a health insurance issuer through the ,,ihp4 7,b7 ,rules for enrollment ,nothing in this paragraph shall preclude an ,,ihp from establishing rules of enrollment and reenrollment of members4 ,such rules shall be applied consistently to all members within the ,,ihp and shall not be based in any manner on health status-related factors4 7#b7 ,health insurance issuers ,the contract between an ,,ihp and a health insurance issuer shall provide1 with respect to a member enrolled with health benefits coverage offered by the issuer through the ,,ihp1 for the payment to the issuer of the premiums 7if any7 collected by the ,,ihp for health insurance coverage offered by the issuer4 #cdjb4 ,application of certain laws and requirements 7a7 ,preemption of ,state laws restricting formation of ,i,h,ps ,any ,state law or regulation relating to the composition or organization of an ,,ihp is preempted to the extent the law or regulation is inconsistent with the provisions of this title4 7b7 ,preemption of ,state requirements relating to health benefit coverage 7#a7 ,benefit requirements 7,a7 ,in general ,subject to subparagraph 7,b71 ,state laws are superseded1 and shall not apply to health benefits coverage made available through an ,,ihp1 insofar as such laws impose benefit requirements for such coverage1 including requirements relating to coverage of specific providers1 specific services or conditions1 or the amount1 duration1 or scope of benefits4 7,b7 ,exception for ,federally imposed requirements and for requirements prohibiting disease-specific exclusions ,subparagraph 7,a7 shall not apply to a requirement to the extent the requirement-- 7i7 implements title ,,xxvii or other ,federal law2 or 7ii7 prohibits imposition of an exclusion of a specific disease from health benefits coverage4 7#b7 ,other requirements preventing offering of coverage through an ,,ihp ,state laws are superseded1 and shall not apply to health benefits coverage made available through an ,,ihp1 insofar as such laws impose any other requirements 7including limitations on compensation arrangements7 that1 directly or indirectly1 preclude 7or have the effect of precluding7 the offering of such coverage through an ,,ihp1 if the ,,ihp meets the requirements of this title4 7c7 ,preemption of ,state premium rating requirements ,state laws are superseded1 and shall not apply to the premiums imposed for health benefits coverage made available through an ,,ihp1 insofar as such laws impose restrictions on the variation of premiums among such coverage offered to members of the ,,ihp4 #cdjc4 ,definitions ,for purposes of this title3 7#a7 ,dependent ,the term dependent1 as applied to health insurance coverage offered by a health insurance issuer licensed 7or otherwise regulated7 in a ,state1 shall have the meaning applied to such term with respect to such coverage under the laws of the ,state relating to such coverage and such an issuer4 ,such term may include the spouse and children of the individual involved4 7#b7 ,health benefits coverage ,the term health benefits coverage has the meaning given the term health insurance coverage in section #bgia7;b77#a71 and does not include excepted benefits 7as defined in section #bgia7;c774 7#c7 ,health insurance issuer ,the term health insurance issuer has the meaning given such term in section #bgia7;b77#b74 7#d7 ,health status-related factor ,the term health status-related factor has the meaning given such term in section #bgia7;d77#i74 7#e7 ,member ,the term member means1 with respect to an ,,ihp1 an individual or small employer who is a member of the legal entity described in section #cdja7;a77#a7 to which the ,,ihp is offering coverage4 7#f7 ,small employer ,the term small employer has the meaning given such term in section #gab7;c77#a77;,b7 of the ,employee ,retirement ,income ,security ,act of #aigd4 4 #cjb4 ,cooperative governing of individual health insurance coverage 7a7 ,in ,general ,title ,,xxvii of the ,public ,health ,service ,act 7#db ,u4,s4,c4 #cjj;gg et seq47 is amended by adding at the end the following new part3 ,d ,cooperative ,governing of ,individual ,health ,insurance ,coverage #bgie4 ,definitions ,in this part3 7#a7 ,primary state ,the term primary ,state means1 with respect to individual health insurance coverage offered by a health insurance issuer1 the ,state designated by the issuer as the ,state whose covered laws shall govern the health insurance issuer in the sale of such coverage under this part4 ,an issuer1 with respect to a particular policy1 may only designate one such ,state as its primary ,state with respect to all such coverage it offers4 ,such an issuer may not change the designated primary ,state with respect to individual health insurance coverage once the policy is issued1 except that such a change may be made upon renewal of the policy4 ,with respect to such designated ,state1 the issuer is deemed to be doing business in that ,state4 7#b7 ,secondary state ,the term secondary ,state means1 with respect to individual health insurance coverage offered by a health insurance issuer1 any ,state that is not the primary ,state4 ,in the case of a health insurance issuer that is selling a policy in1 or to a resident of1 a secondary ,state1 the issuer is deemed to be doing business in that secondary ,state4 7#c7 ,health insurance issuer ,the term health insurance issuer has the meaning given such term in section #bgia7;b77#b71 except that such an issuer must be licensed in the primary ,state and be qualified to sell individual health insurance coverage in that ,state4 7#d7 ,individual health insurance coverage ,the term individual health insurance coverage means health insurance coverage offered in the individual market1 as defined in section #bgia7;e77#a74 7#e7 ,applicable state authority ,the term applicable ,state authority means1 with respect to a health insurance issuer in a ,state1 the ,state insurance commissioner or official or officials designated by the ,state to enforce the requirements of this title for the ,state with respect to the issuer4 7#f7 ,hazardous financial condition ,the term hazardous financial condition means that1 based on its present or reasonably anticipated financial condition1 a health insurance issuer is unlikely to be able-- 7,a7 to meet obligations to policyholders with respect to known claims and reasonably anticipated claims2 or 7,b7 to pay other obligations in the normal course of business4 7#g7 ,covered laws 7,a7 ,in general ,the term covered laws means the laws1 rules1 regulations1 agreements1 and orders governing the insurance business pertaining to-- 7i7 individual health insurance coverage issued by a health insurance issuer2 7ii7 the offer1 sale1 rating 7including medical underwriting71 renewal1 and issuance of individual health insurance coverage to an individual2 7iii7 the provision to an individual in relation to individual health insurance coverage of health care and insurance related services2 7iv7 the provision to an individual in relation to individual health insurance coverage of management1 operations1 and investment activities of a health insurance issuer2 and 7v7 the provision to an individual in relation to individual health insurance coverage of loss control and claims administration for a health insurance issuer with respect to liability for which the issuer provides insurance4 7,b7 ,exception ,such term does not include any law1 rule1 regulation1 agreement1 or order governing the use of care or cost management techniques1 including any requirement related to provider contracting1 network access or adequacy1 health care data collection1 or quality assurance4 7#h7 ,state ,the term ,state means the #ej ,states and includes the ,district of ,columbia1 ,puerto ,rico1 the ,virgin ,islands1 ,guam1 ,american ,samoa1 and the ,northern ,mariana ,islands4 7#i7 ,unfair claims settlement practices ,the term unfair claims settlement practices means only the following practices3 7,a7 ,knowingly misrepresenting to claimants and insured individuals relevant facts or policy provisions relating to coverage at issue4 7,b7 ,failing to acknowledge with reasonable promptness pertinent communications with respect to claims arising under policies4 7,c7 ,failing to adopt and implement reasonable standards for the prompt investigation and settlement of claims arising under policies4 7,d7 ,failing to effectuate prompt1 fair1 and equitable settlement of claims submitted in which liability has become reasonably clear4 7,e7 ,refusing to pay claims without conducting a reasonable investigation4 7,f7 ,failing to affirm or deny coverage of claims within a reasonable period of time after having completed an investigation related to those claims4 7,g7 ,a pattern or practice of compelling insured individuals or their beneficiaries to institute suits to recover amounts due under its policies by offering substantially less than the amounts ultimately recovered in suits brought by them4 7,h7 ,a pattern or practice of attempting to settle or settling claims for less than the amount that a reasonable person would believe the insured individual or his or her beneficiary was entitled by reference to written or printed advertising material accompanying or made part of an application4 7,i7 ,attempting to settle or settling claims on the basis of an application that was materially altered without notice to1 or knowledge or consent of1 the insured4 7,j7 ,failing to provide forms necessary to present claims within #ae calendar days of requests with reasonable explanations regarding their use4 7,k7 ,attempting to cancel a policy in less time than that prescribed in the policy or by the law of the primary ,state4 7#aj7 ,fraud and abuse ,the term fraud and abuse means an act or omission committed by a person who1 knowingly and with intent to defraud1 commits1 or conceals any material information concerning1 one or more of the following3 7,a7 ,presenting1 causing to be presented1 or preparing with knowledge or belief that it will be presented to or by an insurer1 a reinsurer1 or broker or its agent1 false information as part of1 in support of1 or concerning a fact material to one or more of the following3 7i7 ,an application for the issuance or renewal of an insurance policy or reinsurance contract4 7ii7 ,the rating of an insurance policy or reinsurance contract4 7iii7 ,a claim for payment or benefit pursuant to an insurance policy or reinsurance contract4 7iv7 ,premiums paid on an insurance policy or reinsurance contract4 7v7 ,payments made in accordance with the terms of an insurance policy or reinsurance contract4 7vi7 ,a document filed with the commissioner or the chief insurance regulatory official of another jurisdiction4 7vii7 ,the financial condition of an insurer or reinsurer4 7viii7 ,the formation1 acquisition1 merger1 reconsolidation1 dissolution or withdrawal from one or more lines of insurance or reinsurance in all or part of a ,state by an insurer or reinsurer4 7ix7 ,the issuance of written evidence of insurance4 7x7 ,the reinstatement of an insurance policy4 7,b7 ,solicitation or acceptance of new or renewal insurance risks on behalf of an insurer1 reinsurer1 or other person engaged in the business of insurance by a person who knows or should know that the insurer or other person responsible for the risk is insolvent at the time of the transaction4 7,c7 ,transaction of the business of insurance in violation of laws requiring a license1 certificate of authority1 or other legal authority for the transaction of the business of insurance4 7,d7 ,attempt to commit1 aiding or abetting in the commission of1 or conspiracy to commit the acts or omissions specified in this paragraph4 #bgif4 ,application of law 7a7 ,in ,general ,the covered laws of the primary ,state shall apply to individual health insurance coverage offered by a health insurance issuer in the primary ,state and in any secondary ,state1 but only if the coverage and issuer comply with the conditions of this section with respect to the offering of coverage in any secondary ,state4 7b7 ,exemptions ,from ,covered ,laws in a ,secondary ,state ,except as provided in this section1 a health insurance issuer with respect to its offer1 sale1 rating 7including medical underwriting71 renewal1 and issuance of individual health insurance coverage in any secondary ,state is exempt from any covered laws of the secondary ,state 7and any rules1 regulations1 agreements1 or orders sought or issued by such ,state under or related to such covered laws7 to the extent that such laws would-- 7#a7 make unlawful1 or regulate1 directly or indirectly1 the operation of the health insurance issuer operating in the secondary ,state1 except that any secondary ,state may require such an issuer-- 7,a7 to pay1 on a nondiscriminatory basis1 applicable premium and other taxes 7including high risk pool assessments7 which are levied on insurers and surplus lines insurers1 brokers1 or policyholders under the laws of the ,state2 7,b7 to register with and designate the ,state insurance commissioner as its agent solely for the purpose of receiving service of legal documents or process2 7,c7 to submit to an examination of its financial condition by the ,state insurance commissioner in any ,state in which the issuer is doing business to determine the issuer's financial condition1 if-- 7i7 the ,state insurance commissioner of the primary ,state has not done an examination within the period recommended by the ,national ,association of ,insurance ,commissioners2 and 7ii7 any such examination is conducted in accordance with the examiners' handbook of the ,national ,association of ,insurance ,commissioners and is coordinated to avoid unjustified duplication and unjustified repetition2 7,d7 to comply with a lawful order issued-- 7i7 in a delinquency proceeding commenced by the ,state insurance commissioner if there has been a finding of financial impairment under subparagraph 7,c72 or 7ii7 in a voluntary dissolution proceeding2 7,e7 to comply with an injunction issued by a court of competent jurisdiction1 upon a petition by the ,state insurance commissioner alleging that the issuer is in hazardous financial condition2 7,f7 to participate1 on a nondiscriminatory basis1 in any insurance insolvency guaranty association or similar association to which a health insurance issuer in the ,state is required to belong2 7,g7 to comply with any ,state law regarding fraud and abuse 7as defined in section #bgie7aj771 except that if the ,state seeks an injunction regarding the conduct described in this subparagraph1 such injunction must be obtained from a court of competent jurisdiction2 7,h7 to comply with any ,state law regarding unfair claims settlement practices 7as defined in section #bgie7i772 or 7,i7 to comply with the applicable requirements for independent review under section #bgih with respect to coverage offered in the ,state2 7#b7 require any individual health insurance coverage issued by the issuer to be countersigned by an insurance agent or broker residing in that secondary ,state2 or 7#c7 otherwise discriminate against the issuer issuing insurance in both the primary ,state and in any secondary ,state4 7c7 ,clear and ,conspicuous ,disclosure ,a health insurance issuer shall provide the following notice1 in #ab-point bold type1 in any insurance coverage offered in a secondary ,state under this part by such a health insurance issuer and at renewal of the policy1 with the #e blank spaces therein being appropriately filled with the name of the health insurance issuer1 the name of the primary ,state1 the name of the secondary ,state1 the name of the secondary ,state1 and the name of the secondary ,state1 respectively1 for the coverage concerned3 ,notice ,this policy is issued by and is governed by the laws and regulations of the 1 and it has met all the laws of that ,state as determined by that ,state's ,department of ,insurance4 ,this policy may be less expensive than others because it is not subject to all of the insurance laws and regulations of the 1 including coverage of some services or benefits mandated by the law of the 4 ,additionally1 this policy is not subject to all of the consumer protection laws or restrictions on rate changes of the 4 ,as with all insurance products1 before purchasing this policy1 you should carefully review the policy and determine what health care services the policy covers and what benefits it provides1 including any exclusions1 limitations1 or conditions for such services or benefits4 4 7d7 ,prohibition on ,certain ,reclassifications and ,premium ,increases 7#a7 ,in general ,for purposes of this section1 a health insurance issuer that provides individual health insurance coverage to an individual under this part in a primary or secondary ,state may not upon renewal-- 7,a7 move or reclassify the individual insured under the health insurance coverage from the class such individual is in at the time of issue of the contract based on the health-status related factors of the individual2 or 7,b7 increase the premiums assessed the individual for such coverage based on a health status-related factor or change of a health status-related factor or the past or prospective claim experience of the insured individual4 7#b7 ,construction ,nothing in paragraph 7#a7 shall be construed to prohibit a health insurance issuer-- 7,a7 from terminating or discontinuing coverage or a class of coverage in accordance with subsections 7b7 and 7c7 of section #bgdb2 7,b7 from raising premium rates for all policy holders within a class based on claims experience2 7,c7 from changing premiums or offering discounted premiums to individuals who engage in wellness activities at intervals prescribed by the issuer1 if such premium changes or incentives-- 7i7 are disclosed to the consumer in the insurance contract2 7ii7 are based on specific wellness activities that are not applicable to all individuals2 and 7iii7 are not obtainable by all individuals to whom coverage is offered2 7,d7 from reinstating lapsed coverage2 or 7,e7 from retroactively adjusting the rates charged an insured individual if the initial rates were set based on material misrepresentation by the individual at the time of issue4 7e7 ,prior ,offering of ,policy in ,primary ,state ,a health insurance issuer may not offer for sale individual health insurance coverage in a secondary ,state unless that coverage is currently offered for sale in the primary ,state4 7f7 ,licensing of ,agents or ,brokers for ,health ,insurance ,issuers ,any ,state may require that a person acting1 or offering to act1 as an agent or broker for a health insurance issuer with respect to the offering of individual health insurance coverage obtain a license from that ,state1 with commissions or other compensation subject to the provisions of the laws of that ,state1 except that a ,state may not impose any qualification or requirement which discriminates against a nonresident agent or broker4 7g7 ,documents for ,submission to ,state ,insurance ,commissioner ,each health insurance issuer issuing individual health insurance coverage in both primary and secondary ,states shall submit-- 7#a7 to the insurance commissioner of each ,state in which it intends to offer such coverage1 before it may offer individual health insurance coverage in such ,state-- 7,a7 a copy of the plan of operation or feasibility study or any similar statement of the policy being offered and its coverage 7which shall include the name of its primary ,state and its principal place of business72 7,b7 written notice of any change in its designation of its primary ,state2 and 7,c7 written notice from the issuer of the issuer's compliance with all the laws of the primary ,state2 and 7#b7 to the insurance commissioner of each secondary ,state in which it offers individual health insurance coverage1 a copy of the issuer's quarterly financial statement submitted to the primary ,state1 which statement shall be certified by an independent public accountant and contain a statement of opinion on loss and loss adjustment expense reserves made by-- 7,a7 a member of the ,american ,academy of ,actuaries2 or 7,b7 a qualified loss reserve specialist4 7h7 ,power of ,courts ,to ,enjoin ,conduct ,nothing in this section shall be construed to affect the authority of any ,federal or ,state court to enjoin-- 7#a7 the solicitation or sale of individual health insurance coverage by a health insurance issuer to any person or group who is not eligible for such insurance2 or 7#b7 the solicitation or sale of individual health insurance coverage that violates the requirements of the law of a secondary ,state which are described in subparagraphs 7,a7 through 7,h7 of section #bgif7;b77#a74 7i7 ,power of ,secondary ,states ,to ,take ,administrative ,action ,nothing in this section shall be construed to affect the authority of any ,state to enjoin conduct in violation of that ,state's laws described in section #bgif7;b77#a74 7j7 ,state ,powers ,to ,enforce ,state ,laws 7#a7 ,in general ,subject to the provisions of subsection 7b77#a77;,g7 7relating to injunctions7 and paragraph 7#b71 nothing in this section shall be construed to affect the authority of any ,state to make use of any of its powers to enforce the laws of such ,state with respect to which a health insurance issuer is not exempt under subsection 7b74 7#b7 ,courts of competent jurisdiction ,if a ,state seeks an injunction regarding the conduct described in paragraphs 7#a7 and 7#b7 of subsection 7h71 such injunction must be obtained from a ,federal or ,state court of competent jurisdiction4 7k7 ,states' ,authority ,to ,sue ,nothing in this section shall affect the authority of any ,state to bring action in any ,federal or ,state court4 7l7 ,generally ,applicable ,laws ,nothing in this section shall be construed to affect the applicability of ,state laws generally applicable to persons or corporations4 7m7 ,guaranteed ,availability of ,coverage to ,,hipaa ,eligible ,individuals ,to the extent that a health insurance issuer is offering coverage in a primary ,state that does not accommodate residents of secondary ,states or does not provide a working mechanism for residents of a secondary ,state1 and the issuer is offering coverage under this part in such secondary ,state which has not adopted a qualified high risk pool as its acceptable alternative mechanism 7as defined in section #bgdd7;c77#b771 the issuer shall1 with respect to any individual health insurance coverage offered in a secondary ,state under this part1 comply with the guaranteed availability requirements for eligible individuals in section #bgda4 #bgig4 ,primary ,state must meet ,federal floor before issuer may sell into secondary ,states ,a health insurance issuer may not offer1 sell1 or issue individual health insurance coverage in a secondary ,state if the ,state insurance commissioner does not use a risk-based capital formula for the determination of capital and surplus requirements for all health insurance issuers4 #bgih4 ,independent external appeals procedures 7a7 ,right to ,external ,appeal ,a health insurance issuer may not offer1 sell1 or issue individual health insurance coverage in a secondary ,state under the provisions of this title unless-- 7#a7 both the secondary ,state and the primary ,state have legislation or regulations in place establishing an independent review process for individuals who are covered by individual health insurance coverage2 or 7#b7 in any case in which the requirements of paragraph 7#a7 are not met with respect to the either of such ,states1 the issuer provides an independent review mechanism substantially identical 7as determined by the applicable ,state authority of such ,state7 to that prescribed in the ,health ,carrier ,external ,review ,model ,act of the ,national ,association of ,insurance ,commissioners for all individuals who purchase insurance coverage under the terms of this part1 except that1 under such mechanism1 the review is conducted by an independent medical reviewer1 or a panel of such reviewers1 with respect to whom the requirements of subsection 7b7 are met4 7b7 ,qualifications of ,independent ,medical ,reviewers ,in the case of any independent review mechanism referred to in subsection 7a77#b73 7#a7 ,in general ,in referring a denial of a claim to an independent medical reviewer1 or to any panel of such reviewers1 to conduct independent medical review1 the issuer shall ensure that-- 7,a7 each independent medical reviewer meets the qualifications described in paragraphs 7#b7 and 7#c72 7,b7 with respect to each review1 each reviewer meets the requirements of paragraph 7#d7 and the reviewer1 or at least #a reviewer on the panel1 meets the requirements described in paragraph 7#e72 and 7,c7 compensation provided by the issuer to each reviewer is consistent with paragraph 7#f74 7#b7 ,licensure and expertise ,each independent medical reviewer shall be a physician 7allopathic or osteopathic7 or health care professional who-- 7,a7 is appropriately credentialed or licensed in one or more ,states to deliver health care services2 and 7,b7 typically treats the condition1 makes the diagnosis1 or provides the type of treatment under review4 7#c7 ,independence 7,a7 ,in general ,subject to subparagraph 7,b71 each independent medical reviewer in a case shall-- 7i7 not be a related party 7as defined in paragraph 7#g772 7ii7 not have a material familial1 financial1 or professional relationship with such a party2 and 7iii7 not otherwise have a conflict of interest with such a party 7as determined under regulations74 7,b7 ,exception ,nothing in subparagraph 7,a7 shall be construed to-- 7i7 prohibit an individual1 solely on the basis of affiliation with the issuer1 from serving as an independent medical reviewer if-- 7,i7 a non-affiliated individual is not reasonably available2 7,,ii7 the affiliated individual is not involved in the provision of items or services in the case under review2 7,,iii7 the fact of such an affiliation is disclosed to the issuer and the enrollee 7or authorized representative7 and neither party objects2 and 7,,iv7 the affiliated individual is not an employee of the issuer and does not provide services exclusively or primarily to or on behalf of the issuer2 7ii7 prohibit an individual who has staff privileges at the institution where the treatment involved takes place from serving as an independent medical reviewer merely on the basis of such affiliation if the affiliation is disclosed to the issuer and the enrollee 7or authorized representative71 and neither party objects2 or 7iii7 prohibit receipt of compensation by an independent medical reviewer from an entity if the compensation is provided consistent with paragraph 7#f74 7#d7 ,practicing health care professional in same field 7,a7 ,in general ,in a case involving treatment1 or the provision of items or services-- 7i7 by a physician1 a reviewer shall be a practicing physician 7allopathic or osteopathic7 of the same or similar specialty1 as a physician who1 acting within the appropriate scope of practice within the ,state in which the service is provided or rendered1 typically treats the condition1 makes the diagnosis1 or provides the type of treatment under review2 or 7ii7 by a non-physician health care professional1 the reviewer1 or at least #a member of the review panel1 shall be a practicing non-physician health care professional of the same or similar specialty as the non-physician health care professional who1 acting within the appropriate scope of practice within the ,state in which the service is provided or rendered1 typically treats the condition1 makes the diagnosis1 or provides the type of treatment under review4 7,b7 ,practicing defined ,for purposes of this paragraph1 the term practicing means1 with respect to an individual who is a physician or other health care professional1 that the individual provides health care services to individual patients on average at least #b days per week4 7#e7 ,pediatric expertise ,in the case of an external review relating to a child1 a reviewer shall have expertise under paragraph 7#b7 in pediatrics4 7#f7 ,limitations on reviewer compensation ,compensation provided by the issuer to an independent medical reviewer in connection with a review under this section shall-- 7,a7 not exceed a reasonable level2 and 7,b7 not be contingent on the decision rendered by the reviewer4 7#g7 ,related party defined ,for purposes of this section1 the term related party means1 with respect to a denial of a claim under a coverage relating to an enrollee1 any of the following3 7,a7 ,the issuer involved1 or any fiduciary1 officer1 director1 or employee of the issuer4 7,b7 ,the enrollee 7or authorized representative74 7,c7 ,the health care professional that provides the items or services involved in the denial4 7,d7 ,the institution at which the items or services 7or treatment7 involved in the denial are provided4 7,e7 ,the manufacturer of any drug or other item that is included in the items or services involved in the denial4 7,f7 ,any other party determined under any regulations to have a substantial interest in the denial involved4 7#h7 ,definitions ,for purposes of this subsection-- 7,a7 ,enrollee ,the term enrollee means1 with respect to health insurance coverage offered by a health insurance issuer1 an individual enrolled with the issuer to receive such coverage4 7,b7 ,health care professional ,the term health care professional means an individual who is licensed1 accredited1 or certified under ,state law to provide specified health care services and who is operating within the scope of such licensure1 accreditation1 or certification4 #bgii4 ,enforcement 7a7 ,in ,general ,subject to subsection 7b71 with respect to specific individual health insurance coverage the primary ,state for such coverage has sole jurisdiction to enforce the primary ,state's covered laws in the primary ,state and any secondary ,state4 7b7 ,secondary ,state's ,authority ,nothing in subsection 7a7 shall be construed to affect the authority of a secondary ,state to enforce its laws as set forth in the exception specified in section #bgif7;b77#a74 7c7 ,court ,interpretation ,in reviewing action initiated by the applicable secondary ,state authority1 the court of competent jurisdiction shall apply the covered laws of the primary ,state4 7d7 ,notice of ,compliance ,failure ,in the case of individual health insurance coverage offered in a secondary ,state that fails to comply with the covered laws of the primary ,state1 the applicable ,state authority of the secondary ,state may notify the applicable ,state authority of the primary ,state4 4 7b7 ,effective ,date ,the amendment made by subsection 7a7 shall apply to individual health insurance coverage offered1 issued1 or sold after the date that is one year after the date of the enactment of this ,act4 7c7 ,,gao ,ongoing ,study and ,reports 7#a7 ,study ,the ,comptroller ,general of the ,united ,states shall conduct an ongoing study concerning the effect of the amendment made by subsection 7a7 on-- 7,a7 the number of uninsured and underinsured2 7,b7 the availability and cost of health insurance policies for individuals with pre-existing medical conditions2 7,c7 the availability and cost of health insurance policies generally2 7,d7 the elimination or reduction of different types of benefits under health insurance policies offered in different ,states2 and 7,e7 cases of fraud or abuse relating to health insurance coverage offered under such amendment and the resolution of such cases4 7#b7 ,annual reports ,the ,comptroller ,general shall submit to ,congress an annual report1 after the end of each of the #e years following the effective date of the amendment made by subsection 7a71 on the ongoing study conducted under paragraph 7#a74 ,,iv ,association health plans #dja4 ,rules governing association health plans 7a7 ,in ,general ,subtitle ,b of title ,i of the ,employee ,retirement ,income ,security ,act of #aigd is amended by adding after part #g the following new part3 #h ,rules governing association health plans #hja4 ,association health plans 7a7 ,in ,general ,for purposes of this part1 the term association health plan means a group health plan whose sponsor is 7or is deemed under this part to be7 described in subsection 7b74 7b7 ,sponsorship ,the sponsor of a group health plan is described in this subsection if such sponsor-- 7#a7 is organized and maintained in good faith1 with a constitution and bylaws specifically stating its purpose and providing for periodic meetings on at least an annual basis1 as a bona fide trade association1 a bona fide industry association 7including a rural electric cooperative association or a rural telephone cooperative association71 a bona fide professional association1 or a bona fide chamber of commerce 7or similar bona fide business association1 including a corporation or similar organization that operates on a cooperative basis 7within the meaning of section #acha of the ,internal ,revenue ,code of #aihf771 for substantial purposes other than that of obtaining or providing medical care2 7#b7 is established as a permanent entity which receives the active support of its members and requires for membership payment on a periodic basis of dues or payments necessary to maintain eligibility for membership in the sponsor2 and 7#c7 does not condition membership1 such dues or payments1 or coverage under the plan on the basis of health status-related factors with respect to the employees of its members 7or affiliated members71 or the dependents of such employees1 and does not condition such dues or payments on the basis of group health plan participation4 ,any sponsor consisting of an association of entities which meet the requirements of paragraphs 7#a71 7#b71 and 7#c7 shall be deemed to be a sponsor described in this subsection4 #hjb4 ,certification of association health plans 7a7 ,in ,general ,the applicable authority shall prescribe by regulation a procedure under which1 subject to subsection 7b71 the applicable authority shall certify association health plans which apply for certification as meeting the requirements of this part4 7b7 ,standards ,under the procedure prescribed pursuant to subsection 7a71 in the case of an association health plan that provides at least one benefit option which does not consist of health insurance coverage1 the applicable authority shall certify such plan as meeting the requirements of this part only if the applicable authority is satisfied that the applicable requirements of this part are met 7or1 upon the date on which the plan is to commence operations1 will be met7 with respect to the plan4 7c7 ,requirements ,applicable to ,certified ,plans ,an association health plan with respect to which certification under this part is in effect shall meet the applicable requirements of this part1 effective on the date of certification 7or1 if later1 on the date on which the plan is to commence operations74 7d7 ,requirements for ,continued ,certification ,the applicable authority may provide by regulation for continued certification of association health plans under this part4 7e7 ,class ,certification for ,fully ,insured ,plans ,the applicable authority shall establish a class certification procedure for association health plans under which all benefits consist of health insurance coverage4 ,under such procedure1 the applicable authority shall provide for the granting of certification under this part to the plans in each class of such association health plans upon appropriate filing under such procedure in connection with plans in such class and payment of the prescribed fee under section #hjg7;a74 7f7 ,certification of ,self-,insured ,association ,health ,plans ,an association health plan which offers one or more benefit options which do not consist of health insurance coverage may be certified under this part only if such plan consists of-- 7#a7 a plan which offered such coverage on the date of the enactment of the ,obamacare ,replacement ,act2 7#b7 a plan under which the sponsor does not restrict membership to one or more trades and businesses or industries and whose eligible participating employers represent a broad cross-section of trades and businesses or industries2 or 7#c7 a plan whose eligible participating employers represent one or more trades or businesses1 or one or more industries1 consisting of any of the following3 agriculture2 equipment and automobile dealerships2 barbering and cosmetology2 certified public accounting practices2 child care2 construction2 dance1 theatrical and orchestra productions2 disinfecting and pest control2 financial services2 fishing2 food service establishments2 hospitals2 labor organizations2 logging2 manufacturing 7metals72 mining2 medical and dental practices2 medical laboratories2 professional consulting services2 sanitary services2 transportation 7local and freight72 warehousing2 wholesaling_/distributing2 or any other trade or business or industry which has been indicated as having average or above-average risk or health claims experience by reason of ,state rate filings1 denials of coverage1 proposed premium rate levels1 or other means demonstrated by such plan in accordance with regulations4 #hjc4 ,requirements relating to sponsors and boards of trustees 7a7 ,sponsor ,the requirements of this subsection are met with respect to an association health plan if the sponsor has met 7or is deemed under this part to have met7 the requirements of section #hja7;b7 for a continuous period of not less than #c years ending with the date of the application for certification under this part4 7b7 ,board of ,trustees ,the requirements of this subsection are met with respect to an association health plan if the following requirements are met3 7#a7 ,fiscal control ,the plan is operated1 pursuant to a trust agreement1 by a board of trustees which has complete fiscal control over the plan and which is responsible for all operations of the plan4 7#b7 ,rules of operation and financial controls ,the board of trustees has in effect rules of operation and financial controls1 based on a #c-year plan of operation1 adequate to carry out the terms of the plan and to meet all requirements of this title applicable to the plan4 7#c7 ,rules governing relationship to participating employers and to contractors 7,a7 ,board membership 7i7 ,in general ,except as provided in clauses 7ii7 and 7iii71 the members of the board of trustees are individuals selected from individuals who are the owners1 officers1 directors1 or employees of the participating employers or who are partners in the participating employers and actively participate in the business4 7ii7 ,limitation 7,i7 ,general rule ,except as provided in subclauses 7,,ii7 and 7,,iii71 no such member is an owner1 officer1 director1 or employee of1 or partner in1 a contract administrator or other service provider to the plan4 7,,ii7 ,limited exception for providers of services solely on behalf of the sponsor ,officers or employees of a sponsor which is a service provider 7other than a contract administrator7 to the plan may be members of the board if they constitute not more than #be percent of the membership of the board and they do not provide services to the plan other than on behalf of the sponsor4 7,,iii7 ,treatment of providers of medical care ,in the case of a sponsor which is an association whose membership consists primarily of providers of medical care1 subclause 7,i7 shall not apply in the case of any service provider described in subclause 7,i7 who is a provider of medical care under the plan4 7iii7 ,certain plans excluded ,clause 7i7 shall not apply to an association health plan which is in existence on the date of the enactment of the ,obamacare ,replacement ,act4 7,b7 ,sole authority ,the board has sole authority under the plan to approve applications for participation in the plan and to contract with a service provider to administer the day-to-day affairs of the plan4 7c7 ,treatment of ,franchise ,networks ,in the case of a group health plan which is established and maintained by a franchiser for a franchise network consisting of its franchisees-- 7#a7 the requirements of subsection 7a7 and section #hja7;a7 shall be deemed met if such requirements would otherwise be met if the franchiser were deemed to be the sponsor referred to in section #hja7;b71 such network were deemed to be an association described in section #hja7;b71 and each franchisee were deemed to be a member 7of the association and the sponsor7 referred to in section #hja7;b72 and 7#b7 the requirements of section #hjd7;a77#a7 shall be deemed met4 ,the ,secretary may by regulation define for purposes of this subsection the terms franchiser1 franchise network1 and franchisee4 #hjd4 ,participation and coverage requirements 7a7 ,covered ,employers and ,individuals ,the requirements of this subsection are met with respect to an association health plan if1 under the terms of the plan-- 7#a7 each participating employer must be-- 7,a7 a member of the sponsor2 7,b7 the sponsor2 or 7,c7 an affiliated member of the sponsor with respect to which the requirements of subsection 7b7 are met1 except that1 in the case of a sponsor which is a professional association or other individual-based association1 if at least one of the officers1 directors1 or employees of an employer1 or at least one of the individuals who are partners in an employer and who actively participates in the business1 is a member or such an affiliated member of the sponsor1 participating employers may also include such employer2 and 7#b7 all individuals commencing coverage under the plan after certification under this part must be-- 7,a7 active or retired owners 7including self-employed individuals71 officers1 directors1 or employees of1 or partners in1 participating employers2 or 7,b7 the beneficiaries of individuals described in subparagraph 7,a74 7b7 ,coverage of ,previously ,uninsured ,employees ,in the case of an association health plan in existence on the date of the enactment of the ,obamacare ,replacement ,act1 an affiliated member of the sponsor of the plan may be offered coverage under the plan as a participating employer only if-- 7#a7 the affiliated member was an affiliated member on the date of certification under this part2 or 7#b7 during the #ab-month period preceding the date of the offering of such coverage1 the affiliated member has not maintained or contributed to a group health plan with respect to any of its employees who would otherwise be eligible to participate in such association health plan4 7c7 ,individual ,market ,unaffected ,the requirements of this subsection are met with respect to an association health plan if1 under the terms of the plan1 no participating employer may provide health insurance coverage in the individual market for any employee not covered under the plan which is similar to the coverage contemporaneously provided to employees of the employer under the plan1 if such exclusion of the employee from coverage under the plan is based on a health status-related factor with respect to the employee and such employee would1 but for such exclusion on such basis1 be eligible for coverage under the plan4 7d7 ,prohibition of ,discrimination ,against ,employers and ,employees ,eligible ,to ,participate ,the requirements of this subsection are met with respect to an association health plan if-- 7#a7 under the terms of the plan1 all employers meeting the preceding requirements of this section are eligible to qualify as participating employers for all geographically available coverage options1 unless1 in the case of any such employer1 participation or contribution requirements of the type referred to in section #bgaa of the ,public ,health ,service ,act are not met2 7#b7 upon request1 any employer eligible to participate is furnished information regarding all coverage options available under the plan2 and 7#c7 the applicable requirements of sections #gja1 #gjb1 and #gjc are met with respect to the plan4 #hje4 ,other requirements relating to plan documents1 contribution rates1 and benefit options 7a7 ,in ,general ,the requirements of this section are met with respect to an association health plan if the following requirements are met3 7#a7 ,contents of governing instruments ,the instruments governing the plan include a written instrument1 meeting the requirements of an instrument required under section #djb7;a77#a71 which-- 7,a7 provides that the board of trustees serves as the named fiduciary required for plans under section #djb7;a77#a7 and serves in the capacity of a plan administrator 7referred to in section #c7af77;,a772 7,b7 provides that the sponsor of the plan is to serve as plan sponsor 7referred to in section #c7af77;,b772 and 7,c7 incorporates the requirements of section #hjf4 7#b7 ,contribution rates must be nondiscriminatory 7,a7 ,the contribution rates for any participating small employer do not vary on the basis of any health status-related factor in relation to employees of such employer or their beneficiaries and do not vary on the basis of the type of business or industry in which such employer is engaged4 7,b7 ,nothing in this title or any other provision of law shall be construed to preclude an association health plan1 or a health insurance issuer offering health insurance coverage in connection with an association health plan1 from-- 7i7 setting contribution rates based on the claims experience of the plan2 or 7ii7 varying contribution rates for small employers in a ,state to the extent that such rates could vary using the same methodology employed in such ,state for regulating premium rates in the small group market with respect to health insurance coverage offered in connection with bona fide associations 7within the meaning of section #bgia7;d77#c7 of the ,public ,health ,service ,act71 subject to the requirements of section #gjb7;b7 relating to contribution rates4 7#c7 ,floor for number of covered individuals with respect to certain plans ,if any benefit option under the plan does not consist of health insurance coverage1 the plan has as of the beginning of the plan year not fewer than #a1jjj participants and beneficiaries4 7#d7 ,marketing requirements 7,a7 ,in general ,if a benefit option which consists of health insurance coverage is offered under the plan1 ,state-licensed insurance agents shall be used to distribute to small employers coverage which does not consist of health insurance coverage in a manner comparable to the manner in which such agents are used to distribute health insurance coverage4 7,b7 ,state-licensed insurance agents ,for purposes of subparagraph 7,a71 the term ,state-licensed insurance agents means one or more agents who are licensed in a ,state and are subject to the laws of such ,state relating to licensure1 qualification1 testing1 examination1 and continuing education of persons authorized to offer1 sell1 or solicit health insurance coverage in such ,state4 7#e7 ,regulatory requirements ,such other requirements as the applicable authority determines are necessary to carry out the purposes of this part1 which shall be prescribed by the applicable authority by regulation4 7b7 ,ability of ,association ,health ,plans ,to ,design ,benefit ,options ,subject to section #ead7;d71 nothing in this part or any provision of ,state law 7as defined in section #ead7;c77#a77 shall be construed to preclude an association health plan1 or a health insurance issuer offering health insurance coverage in connection with an association health plan1 from exercising its sole discretion in selecting the specific items and services consisting of medical care to be included as benefits under such plan or coverage1 except 7subject to section #ead7 in the case of 7#a7 any law to the extent that it is not preempted under section #gca7;a77#a7 with respect to matters governed by section #gaa1 #gab1 or #gac1 or 7#b7 any law of the ,state with which filing and approval of a policy type offered by the plan was initially obtained to the extent that such law prohibits an exclusion of a specific disease from such coverage4 #hjf4 ,maintenance of reserves and provisions for solvency for plans providing health benefits in addition to health insurance coverage 7a7 ,in ,general ,the requirements of this section are met with respect to an association health plan if-- 7#a7 the benefits under the plan consist solely of health insurance coverage2 or 7#b7 if the plan provides any additional benefit options which do not consist of health insurance coverage1 the plan-- 7,a7 establishes and maintains reserves with respect to such additional benefit options1 in amounts recommended by the qualified health actuary1 consisting of-- 7i7 a reserve sufficient for unearned contributions2 7ii7 a reserve sufficient for benefit liabilities which have been incurred1 which have not been satisfied1 and for which risk of loss has not yet been transferred1 and for expected administrative costs with respect to such benefit liabilities2 7iii7 a reserve sufficient for any other obligations of the plan2 and 7iv7 a reserve sufficient for a margin of error and other fluctuations1 taking into account the specific circumstances of the plan2 and 7,b7 establishes and maintains aggregate and specific excess_/stop loss insurance and solvency indemnification1 with respect to such additional benefit options for which risk of loss has not yet been transferred1 as follows3 7i7 ,the plan shall secure aggregate excess_/stop loss insurance for the plan with an attachment point which is not greater than #abe percent of expected gross annual claims4 ,the applicable authority may by regulation provide for upward adjustments in the amount of such percentage in specified circumstances in which the plan specifically provides for and maintains reserves in excess of the amounts required under subparagraph 7,a74 7ii7 ,the plan shall secure specific excess_/stop loss insurance for the plan with an attachment point which is at least equal to an amount recommended by the plan's qualified health actuary4 ,the applicable authority may by regulation provide for adjustments in the amount of such insurance in specified circumstances in which the plan specifically provides for and maintains reserves in excess of the amounts required under subparagraph 7,a74 7iii7 ,the plan shall secure indemnification insurance for any claims which the plan is unable to satisfy by reason of a plan termination4 ,any person issuing to a plan insurance described in clause 7i71 7ii71 or 7iii7 of subparagraph 7,b7 shall notify the ,secretary of any failure of premium payment meriting cancellation of the policy prior to undertaking such a cancellation4 ,any regulations prescribed by the applicable authority pursuant to clause 7i7 or 7ii7 of subparagraph 7,b7 may allow for such adjustments in the required levels of excess_/stop loss insurance as the qualified health actuary may recommend1 taking into account the specific circumstances of the plan4 7b7 ,minimum ,surplus in ,addition to ,claims ,reserves ,in the case of any association health plan described in subsection 7a77#b71 the requirements of this subsection are met if the plan establishes and maintains surplus in an amount at least equal to-- 7#a7 #ejj1jjj2 or 7#b7 such greater amount 7but not greater than #b1jjj1jjj7 as may be set forth in regulations prescribed by the applicable authority1 considering the level of aggregate and specific excess_/stop loss insurance provided with respect to such plan and other factors related to solvency risk1 such as the plan's projected levels of participation or claims1 the nature of the plan's liabilities1 and the types of assets available to assure that such liabilities are met4 7c7 ,additional ,requirements ,in the case of any association health plan described in subsection 7a77#b71 the applicable authority may provide such additional requirements relating to reserves1 excess_/stop loss insurance1 and indemnification insurance as the applicable authority considers appropriate4 ,such requirements may be provided by regulation with respect to any such plan or any class of such plans4 7d7 ,adjustments for ,excess_/,stop ,loss ,insurance ,the applicable authority may provide for adjustments to the levels of reserves otherwise required under subsections 7a7 and 7b7 with respect to any plan or class of plans to take into account excess_/stop loss insurance provided with respect to such plan or plans4 7e7 ,alternative ,means of ,compliance ,the applicable authority may permit an association health plan described in subsection 7a77#b7 to substitute1 for all or part of the requirements of this section 7except subsection 7a77#b77;,b77iii771 such security1 guarantee1 hold-harmless arrangement1 or other financial arrangement as the applicable authority determines to be adequate to enable the plan to fully meet all its financial obligations on a timely basis and is otherwise no less protective of the interests of participants and beneficiaries than the requirements for which it is substituted4 ,the applicable authority may take into account1 for purposes of this subsection1 evidence provided by the plan or sponsor which demonstrates an assumption of liability with respect to the plan4 ,such evidence may be in the form of a contract of indemnification1 lien1 bonding1 insurance1 letter of credit1 recourse under applicable terms of the plan in the form of assessments of participating employers1 security1 or other financial arrangement4 7f7 ,measures ,to ,ensure ,continued ,payment of ,benefits by ,certain ,plans in ,distress 7#a7 ,payments by certain plans to association health plan fund 7,a7 ,in general ,in the case of an association health plan described in subsection 7a77#b71 the requirements of this subsection are met if the plan makes payments into the ,association ,health ,plan ,fund under this subparagraph when they are due4 ,such payments shall consist of annual payments in the amount of #e1jjj1 and1 in addition to such annual payments1 such supplemental payments as the ,secretary may determine to be necessary under paragraph 7#b74 ,payments under this paragraph are payable to the ,fund at the time determined by the ,secretary4 ,initial payments are due in advance of certification under this part4 ,payments shall continue to accrue until a plan's assets are distributed pursuant to a termination procedure4 7,b7 ,penalties for failure to make payments ,if any payment is not made by a plan when it is due1 a late payment charge of not more than #ajj percent of the payment which was not timely paid shall be payable by the plan to the ,fund4 7,c7 ,continued duty of the secretary ,the ,secretary shall not cease to carry out the provisions of paragraph 7#b7 on account of the failure of a plan to pay any payment when due4 7#b7 ,payments by secretary to continue excess_/stop loss insurance coverage and indemnification insurance coverage for certain plans ,in any case in which the applicable authority determines that there is1 or that there is reason to believe that there will be3 7,a7 a failure to take necessary corrective actions under section #hji7;a7 with respect to an association health plan described in subsection 7a77#b72 or 7,b7 a termination of such a plan under section #hji7;b7 or #haj7;b77#h7 7and1 if the applicable authority is not the ,secretary1 certifies such determination to the ,secretary71 the ,secretary shall determine the amounts necessary to make payments to an insurer 7designated by the ,secretary7 to maintain in force excess_/stop loss insurance coverage or indemnification insurance coverage for such plan1 if the ,secretary determines that there is a reasonable expectation that1 without such payments1 claims would not be satisfied by reason of termination of such coverage4 ,the ,secretary shall1 to the extent provided in advance in appropriation ,acts1 pay such amounts so determined to the insurer designated by the ,secretary4 7#c7 ,association health plan fund 7,a7 ,in general ,there is established in the ,treasury a fund to be known as the ,association ,health ,plan ,fund4 ,the ,fund shall be available for making payments pursuant to paragraph 7#b74 ,the ,fund shall be credited with payments received pursuant to paragraph 7#a77;,a71 penalties received pursuant to paragraph 7#a77;,b71 and earnings on investments of amounts of the ,fund under subparagraph 7,b74 7,b7 ,investment ,whenever the ,secretary determines that the moneys of the fund are in excess of current needs1 the ,secretary may request the investment of such amounts as the ,secretary determines advisable by the ,secretary of the ,treasury in obligations issued or guaranteed by the ,united ,states4 7g7 ,excess_/,stop ,loss ,insurance ,for purposes of this section3 7#a7 ,aggregate excess_/stop loss insurance ,the term aggregate excess_/stop loss insurance means1 in connection with an association health plan1 a contract-- 7,a7 under which an insurer 7meeting such minimum standards as the applicable authority may prescribe by regulation7 provides for payment to the plan with respect to aggregate claims under the plan in excess of an amount or amounts specified in such contract2 7,b7 which is guaranteed renewable2 and 7,c7 which allows for payment of premiums by any third party on behalf of the insured plan4 7#b7 ,specific excess_/stop loss insurance ,the term specific excess_/stop loss insurance means1 in connection with an association health plan1 a contract-- 7,a7 under which an insurer 7meeting such minimum standards as the applicable authority may prescribe by regulation7 provides for payment to the plan with respect to claims under the plan in connection with a covered individual in excess of an amount or amounts specified in such contract in connection with such covered individual2 7,b7 which is guaranteed renewable2 and 7,c7 which allows for payment of premiums by any third party on behalf of the insured plan4 7h7 ,indemnification ,insurance ,for purposes of this section1 the term indemnification insurance means1 in connection with an association health plan1 a contract-- 7#a7 under which an insurer 7meeting such minimum standards as the applicable authority may prescribe by regulation7 provides for payment to the plan with respect to claims under the plan which the plan is unable to satisfy by reason of a termination pursuant to section #hji7;b7 7relating to mandatory termination72 7#b7 which is guaranteed renewable and noncancellable for any reason 7except as the applicable authority may prescribe by regulation72 and 7#c7 which allows for payment of premiums by any third party on behalf of the insured plan4 7i7 ,reserves ,for purposes of this section1 the term reserves means1 in connection with an association health plan1 plan assets which meet the fiduciary standards under part #d and such additional requirements regarding liquidity as the applicable authority may prescribe by regulation4 7j7 ,solvency ,standards ,working ,group 7#a7 ,in general ,within #ij days after the date of the enactment of the ,obamacare ,replacement ,act1 the applicable authority shall establish a ,solvency ,standards ,working ,group4 ,in prescribing the initial regulations under this section1 the applicable authority shall take into account the recommendations of such ,working ,group4 7#b7 ,membership ,the ,working ,group shall consist of not more than #ae members appointed by the applicable authority4 ,the applicable authority shall include among persons invited to membership on the ,working ,group at least one of each of the following3 7,a7 ,a representative of the ,national ,association of ,insurance ,commissioners4 7,b7 ,a representative of the ,american ,academy of ,actuaries4 7,c7 ,a representative of the ,state governments1 or their interests4 7,d7 ,a representative of existing self-insured arrangements1 or their interests4 7,e7 ,a representative of associations of the type referred to in section #hja7;b77#a71 or their interests4 7,f7 ,a representative of multiemployer plans that are group health plans1 or their interests4 #hjg4 ,requirements for application and related requirements 7a7 ,filing ,fee ,under the procedure prescribed pursuant to section #hjb7;a71 an association health plan shall pay to the applicable authority at the time of filing an application for certification under this part a filing fee in the amount of #e1jjj1 which shall be available in the case of the ,secretary1 to the extent provided in appropriation ,acts1 for the sole purpose of administering the certification procedures applicable with respect to association health plans4 7b7 ,information ,to ,be ,included in ,application for ,certification ,an application for certification under this part meets the requirements of this section only if it includes1 in a manner and form which shall be prescribed by the applicable authority by regulation1 at least the following information3 7#a7 ,identifying information ,the names and addresses of-- 7,a7 the sponsor2 and 7,b7 the members of the board of trustees of the plan4 7#b7 ,states in which plan intends to do business ,the ,states in which participants and beneficiaries under the plan are to be located and the number of them expected to be located in each such ,state4 7#c7 ,bonding requirements ,evidence provided by the board of trustees that the bonding requirements of section #dab will be met as of the date of the application or 7if later7 commencement of operations4 7#d7 ,plan documents ,a copy of the documents governing the plan 7including any bylaws and trust agreements71 the summary plan description1 and other material describing the benefits that will be provided to participants and beneficiaries under the plan4 7#e7 ,agreements with service providers ,a copy of any agreements between the plan and contract administrators and other service providers4 7#f7 ,funding report ,in the case of association health plans providing benefits options in addition to health insurance coverage1 a report setting forth information with respect to such additional benefit options determined as of a date within the #abj-;day period ending with the date of the application1 including the following3 7,a7 ,reserves ,a statement1 certified by the board of trustees of the plan1 and a statement of actuarial opinion1 signed by a qualified health actuary1 that all applicable requirements of section #hjf are or will be met in accordance with regulations which the applicable authority shall prescribe4 7,b7 ,adequacy of contribution rates ,a statement of actuarial opinion1 signed by a qualified health actuary1 which sets forth a description of the extent to which contribution rates are adequate to provide for the payment of all obligations and the maintenance of required reserves under the plan for the #ab-month period beginning with such date within such #abj-;day period1 taking into account the expected coverage and experience of the plan4 ,if the contribution rates are not fully adequate1 the statement of actuarial opinion shall indicate the extent to which the rates are inadequate and the changes needed to ensure adequacy4 7,c7 ,current and projected value of assets and liabilities ,a statement of actuarial opinion signed by a qualified health actuary1 which sets forth the current value of the assets and liabilities accumulated under the plan and a projection of the assets1 liabilities1 income1 and expenses of the plan for the #ab-month period referred to in subparagraph 7,b74 ,the income statement shall identify separately the plan's administrative expenses and claims4 7,d7 ,costs of coverage to be charged and other expenses ,a statement of the costs of coverage to be charged1 including an itemization of amounts for administration1 reserves1 and other expenses associated with the operation of the plan4 7,e7 ,other information ,any other information as may be determined by the applicable authority1 by regulation1 as necessary to carry out the purposes of this part4 7c7 ,filing ,notice of ,certification ,with ,states ,a certification granted under this part to an association health plan shall not be effective unless written notice of such certification is filed with the applicable ,state authority of each ,state in which at least #be percent of the participants and beneficiaries under the plan are located4 ,for purposes of this subsection1 an individual shall be considered to be located in the ,state in which a known address of such individual is located or in which such individual is employed4 7d7 ,notice of ,material ,changes ,in the case of any association health plan certified under this part1 descriptions of material changes in any information which was required to be submitted with the application for the certification under this part shall be filed in such form and manner as shall be prescribed by the applicable authority by regulation4 ,the applicable authority may require by regulation prior notice of material changes with respect to specified matters which might serve as the basis for suspension or revocation of the certification4 7e7 ,reporting ,requirements for ,certain ,association ,health ,plans ,an association health plan certified under this part which provides benefit options in addition to health insurance coverage for such plan year shall meet the requirements of section #ajc by filing an annual report under such section which shall include information described in subsection 7b77#f7 with respect to the plan year and1 notwithstanding section #ajd7;a77#a71 shall be filed with the applicable authority not later than #ij days after the close of the plan year 7or on such later date as may be prescribed by the applicable authority74 ,the applicable authority may require by regulation such interim reports as it considers appropriate4 7f7 ,engagement of ,qualified ,health ,actuary ,the board of trustees of each association health plan which provides benefits options in addition to health insurance coverage and which is applying for certification under this part or is certified under this part shall engage1 on behalf of all participants and beneficiaries1 a qualified health actuary who shall be responsible for the preparation of the materials comprising information necessary to be submitted by a qualified health actuary under this part4 ,the qualified health actuary shall utilize such assumptions and techniques as are necessary to enable such actuary to form an opinion as to whether the contents of the matters reported under this part-- 7#a7 are in the aggregate reasonably related to the experience of the plan and to reasonable expectations2 and 7#b7 represent such actuary's best estimate of anticipated experience under the plan4 ,the opinion by the qualified health actuary shall be made with respect to1 and shall be made a part of1 the annual report4 #hjh4 ,notice requirements for voluntary termination ,except as provided in section #hji7;b71 an association health plan which is or has been certified under this part may terminate 7upon or at any time after cessation of accruals in benefit liabilities7 only if the board of trustees1 not less than #fj days before the proposed termination date-- 7#a7 provides to the participants and beneficiaries a written notice of intent to terminate stating that such termination is intended and the proposed termination date2 7#b7 develops a plan for winding up the affairs of the plan in connection with such termination in a manner which will result in timely payment of all benefits for which the plan is obligated2 and 7#c7 submits such plan in writing to the applicable authority4 ,actions required under this section shall be taken in such form and manner as may be prescribed by the applicable authority by regulation4 #hji4 ,corrective actions and mandatory termination 7a7 ,actions ,to ,avoid ,depletion of ,reserves ,an association health plan which is certified under this part and which provides benefits other than health insurance coverage shall continue to meet the requirements of section #hjf1 irrespective of whether such certification continues in effect4 ,the board of trustees of such plan shall determine quarterly whether the requirements of section #hjf are met4 ,in any case in which the board determines that there is reason to believe that there is or will be a failure to meet such requirements1 or the applicable authority makes such a determination and so notifies the board1 the board shall immediately notify the qualified health actuary engaged by the plan1 and such actuary shall1 not later than the end of the following month1 make such recommendations to the board for corrective action as the actuary determines necessary to ensure compliance with section #hjf4 ,not later than #cj days after receiving from the actuary recommendations for corrective actions1 the board shall notify the applicable authority 7in such form and manner as the applicable authority may prescribe by regulation7 of such recommendations of the actuary for corrective action1 together with a description of the actions 7if any7 that the board has taken or plans to take in response to such recommendations4 ,the board shall thereafter report to the applicable authority1 in such form and frequency as the applicable authority may specify to the board1 regarding corrective action taken by the board until the requirements of section #hjf are met4 7b7 ,mandatory ,termination ,in any case in which-- 7#a7 the applicable authority has been notified under subsection 7a7 7or by an issuer of excess_/stop loss insurance or indemnity insurance pursuant to section #hjf7;a77 of a failure of an association health plan which is or has been certified under this part and is described in section #hjf7;a77#b7 to meet the requirements of section #hjf and has not been notified by the board of trustees of the plan that corrective action has restored compliance with such requirements2 and 7#b7 the applicable authority determines that there is a reasonable expectation that the plan will continue to fail to meet the requirements of section #hjf1 the board of trustees of the plan shall1 at the direction of the applicable authority1 terminate the plan and1 in the course of the termination1 take such actions as the applicable authority may require1 including satisfying any claims referred to in section #hjf7;a77#b77;,b77iii7 and recovering for the plan any liability under subsection 7a77#b77;,b77iii7 or 7e7 of section #hjf1 as necessary to ensure that the affairs of the plan will be1 to the maximum extent possible1 wound up in a manner which will result in timely provision of all benefits for which the plan is obligated4 #haj4 ,trusteeship by the ,secretary of insolvent association health plans providing health benefits in addition to health insurance coverage 7a7 ,appointment of ,secretary as ,trustee for ,insolvent ,plans ,whenever the ,secretary determines that an association health plan which is or has been certified under this part and which is described in section #hjf7;a77#b7 will be unable to provide benefits when due or is otherwise in a financially hazardous condition1 as shall be defined by the ,secretary by regulation1 the ,secretary shall1 upon notice to the plan1 apply to the appropriate ,united ,states district court for appointment of the ,secretary as trustee to administer the plan for the duration of the insolvency4 ,the plan may appear as a party and other interested persons may intervene in the proceedings at the discretion of the court4 ,the court shall appoint such ,secretary trustee if the court determines that the trusteeship is necessary to protect the interests of the participants and beneficiaries or providers of medical care or to avoid any unreasonable deterioration of the financial condition of the plan4 ,the trusteeship of such ,secretary shall continue until the conditions described in the first sentence of this subsection are remedied or the plan is terminated4 7b7 ,powers as ,trustee ,the ,secretary1 upon appointment as trustee under subsection 7a71 shall have the power-- 7#a7 to do any act authorized by the plan1 this title1 or other applicable provisions of law to be done by the plan administrator or any trustee of the plan2 7#b7 to require the transfer of all 7or any part7 of the assets and records of the plan to the ,secretary as trustee2 7#c7 to invest any assets of the plan which the ,secretary holds in accordance with the provisions of the plan1 regulations prescribed by the ,secretary1 and applicable provisions of law2 7#d7 to require the sponsor1 the plan administrator1 any participating employer1 and any employee organization representing plan participants to furnish any information with respect to the plan which the ,secretary as trustee may reasonably need in order to administer the plan2 7#e7 to collect for the plan any amounts due the plan and to recover reasonable expenses of the trusteeship2 7#f7 to commence1 prosecute1 or defend on behalf of the plan any suit or proceeding involving the plan2 7#g7 to issue1 publish1 or file such notices1 statements1 and reports as may be required by the ,secretary by regulation or required by any order of the court2 7#h7 to terminate the plan 7or provide for its termination in accordance with section #hji7;b77 and liquidate the plan assets1 to restore the plan to the responsibility of the sponsor1 or to continue the trusteeship2 7#i7 to provide for the enrollment of plan participants and beneficiaries under appropriate coverage options2 and 7#aj7 to do such other acts as may be necessary to comply with this title or any order of the court and to protect the interests of plan participants and beneficiaries and providers of medical care4 7c7 ,notice of ,appointment ,as soon as practicable after the ,secretary's appointment as trustee1 the ,secretary shall give notice of such appointment to-- 7#a7 the sponsor and plan administrator2 7#b7 each participant2 7#c7 each participating employer2 and 7#d7 if applicable1 each employee organization which1 for purposes of collective bargaining1 represents plan participants4 7d7 ,additional ,duties ,except to the extent inconsistent with the provisions of this title1 or as may be otherwise ordered by the court1 the ,secretary1 upon appointment as trustee under this section1 shall be subject to the same duties as those of a trustee under section #gjd of title #aa1 ,united ,states ,code1 and shall have the duties of a fiduciary for purposes of this title4 7e7 ,other ,proceedings ,an application by the ,secretary under this subsection may be filed notwithstanding the pendency in the same or any other court of any bankruptcy1 mortgage foreclosure1 or equity receivership proceeding1 or any proceeding to reorganize1 conserve1 or liquidate such plan or its property1 or any proceeding to enforce a lien against property of the plan4 7f7 ,jurisdiction of ,court 7#a7 ,in general ,upon the filing of an application for the appointment as trustee or the issuance of a decree under this section1 the court to which the application is made shall have exclusive jurisdiction of the plan involved and its property wherever located with the powers1 to the extent consistent with the purposes of this section1 of a court of the ,united ,states having jurisdiction over cases under chapter #aa of title #aa1 ,united ,states ,code4 ,pending an adjudication under this section such court shall stay1 and upon appointment by it of the ,secretary as trustee1 such court shall continue the stay of1 any pending mortgage foreclosure1 equity receivership1 or other proceeding to reorganize1 conserve1 or liquidate the plan1 the sponsor1 or property of such plan or sponsor1 and any other suit against any receiver1 conservator1 or trustee of the plan1 the sponsor1 or property of the plan or sponsor4 ,pending such adjudication and upon the appointment by it of the ,secretary as trustee1 the court may stay any proceeding to enforce a lien against property of the plan or the sponsor or any other suit against the plan or the sponsor4 7#b7 ,venue ,an action under this section may be brought in the judicial district where the sponsor or the plan administrator resides or does business or where any asset of the plan is situated4 ,a district court in which such action is brought may issue process with respect to such action in any other judicial district4 7g7 ,personnel ,in accordance with regulations which shall be prescribed by the ,secretary1 the ,secretary shall appoint1 retain1 and compensate accountants1 actuaries1 and other professional service personnel as may be necessary in connection with the ,secretary's service as trustee under this section4 #haa4 ,state assessment authority 7a7 ,in ,general ,notwithstanding section #ead1 a ,state may impose by law a contribution tax on an association health plan described in section #hjf7;a77#b71 if the plan commenced operations in such ,state after the date of the enactment of the ,obamacare ,replacement ,act4 7b7 ,contribution ,tax ,for purposes of this section1 the term contribution tax imposed by a ,state on an association health plan means any tax imposed by such ,state if-- 7#a7 such tax is computed by applying a rate to the amount of premiums or contributions1 with respect to individuals covered under the plan who are residents of such ,state1 which are received by the plan from participating employers located in such ,state or from such individuals2 7#b7 the rate of such tax does not exceed the rate of any tax imposed by such ,state on premiums or contributions received by insurers or health maintenance organizations for health insurance coverage offered in such ,state in connection with a group health plan2 7#c7 such tax is otherwise nondiscriminatory2 and 7#d7 the amount of any such tax assessed on the plan is reduced by the amount of any tax or assessment otherwise imposed by the ,state on premiums1 contributions1 or both received by insurers or health maintenance organizations for health insurance coverage1 aggregate excess_/stop loss insurance 7as defined in section #hjf7;g77#a771 specific excess_/stop loss insurance 7as defined in section #hjf7;g77#b771 other insurance related to the provision of medical care under the plan1 or any combination thereof provided by such insurers or health maintenance organizations in such ,state in connection with such plan4 #hab4 ,definitions and rules of construction 7a7 ,definitions ,for purposes of this part-- 7#a7 ,group health plan ,the term group health plan has the meaning provided in section #gcc7;a77#a7 7after applying subsection 7b7 of this section74 7#b7 ,medical care ,the term medical care has the meaning provided in section #gcc7;a77#b74 7#c7 ,health insurance coverage ,the term health insurance coverage has the meaning provided in section #gcc7;b77#a74 7#d7 ,health insurance issuer ,the term health insurance issuer has the meaning provided in section #gcc7;b77#b74 7#e7 ,applicable authority ,the term applicable authority means the ,secretary1 except that1 in connection with any exercise of the ,secretary's authority regarding which the ,secretary is required under section #ejf7;d7 to consult with a ,state1 such term means the ,secretary1 in consultation with such ,state4 7#f7 ,health status-related factor ,the term health status-related factor has the meaning provided in section #gcc7;d77#b74 7#g7 ,individual market 7,a7 ,in general ,the term individual market means the market for health insurance coverage offered to individuals other than in connection with a group health plan4 7,b7 ,treatment of very small groups 7i7 ,in general ,subject to clause 7ii71 such term includes coverage offered in connection with a group health plan that has fewer than #b participants as current employees or participants described in section #gcb7;d77#c7 on the first day of the plan year4 7ii7 ,state exception ,clause 7i7 shall not apply in the case of health insurance coverage offered in a ,state if such ,state regulates the coverage described in such clause in the same manner and to the same extent as coverage in the small group market 7as defined in section #bgia7;e77#e7 of the ,public ,health ,service ,act7 is regulated by such ,state4 7#h7 ,participating employer ,the term participating employer means1 in connection with an association health plan1 any employer1 if any individual who is an employee of such employer1 a partner in such employer1 or a self-employed individual who is such employer 7or any dependent1 as defined under the terms of the plan1 of such individual7 is or was covered under such plan in connection with the status of such individual as such an employee1 partner1 or self-employed individual in relation to the plan4 7#i7 ,applicable state authority ,the term applicable ,state authority means1 with respect to a health insurance issuer in a ,state1 the ,state insurance commissioner or official or officials designated by the ,state to enforce the requirements of title ,,xxvii of the ,public ,health ,service ,act for the ,state involved with respect to such issuer4 7#aj7 ,qualified health actuary ,the term qualified health actuary means an individual who is a member of the ,american ,academy of ,actuaries with expertise in health care4 7#aa7 ,affiliated member ,the term affiliated member means1 in connection with a sponsor-- 7,a7 a person who is otherwise eligible to be a member of the sponsor but who elects an affiliated status with the sponsor1 7,b7 in the case of a sponsor with members which consist of associations1 a person who is a member of any such association and elects an affiliated status with the sponsor1 or 7,c7 in the case of an association health plan in existence on the date of the enactment of the ,obamacare ,replacement ,act1 a person eligible to be a member of the sponsor or one of its member associations4 7#ab7 ,large employer ,the term large employer means1 in connection with a group health plan with respect to a plan year1 an employer who employed an average of at least #ea employees on business days during the preceding calendar year and who employs at least #b employees on the first day of the plan year4 7#ac7 ,small employer ,the term small employer means1 in connection with a group health plan with respect to a plan year1 an employer who is not a large employer4 7b7 ,rules of ,construction 7#a7 ,employers and employees ,for purposes of determining whether a plan1 fund1 or program is an employee welfare benefit plan which is an association health plan1 and for purposes of applying this title in connection with such plan1 fund1 or program so determined to be such an employee welfare benefit plan-- 7,a7 in the case of a partnership1 the term employer 7as defined in section #c7e77 includes the partnership in relation to the partners1 and the term employee 7as defined in section #c7f77 includes any partner in relation to the partnership2 and 7,b7 in the case of a self-employed individual1 the term employer 7as defined in section #c7e77 and the term employee 7as defined in section #c7f77 shall include such individual4 7#b7 ,plans1 funds1 and programs treated as employee welfare benefit plans ,in the case of any plan1 fund1 or program which was established or is maintained for the purpose of providing medical care 7through the purchase of insurance or otherwise7 for employees 7or their dependents7 covered thereunder and which demonstrates to the ,secretary that all requirements for certification under this part would be met with respect to such plan1 fund1 or program if such plan1 fund1 or program were a group health plan1 such plan1 fund1 or program shall be treated for purposes of this title as an employee welfare benefit plan on and after the date of such demonstration4 7#c7 ,exception for certain benefits ,the requirements of this part shall not apply to a group health plan in relation to its provision of excepted benefits1 as defined in section #gcc7;c74 4 7b7 ,conforming ,amendments to ,preemption ,rules 7#a7 ,section #ead7;b77#f7 of such ,act 7#bi ,u4,s4,c4 #aadd7;b77#f77 is amended by adding at the end the following new subparagraph3 7,e7 ,the preceding subparagraphs of this paragraph do not apply with respect to any ,state law in the case of an association health plan which is certified under part #h4 4 7#b7 ,section #ead of such ,act 7#bi ,u4,s4,c4 #aadd7 is amended-- 7,a7 in subsection 7b77#d71 by striking ,subsection 7a7 and inserting ,subsections 7a7 and 7d72 7,b7 in subsection 7b77#e71 by striking subsection 7a7 in subparagraph 7,a7 and inserting subsection 7a7 of this section and subsections 7a77#b77;,b7 and 7b7 of section #hje1 and by striking subsection 7a7 in subparagraph 7,b7 and inserting subsection 7a7 of this section or subsection 7a77#b77;,b7 or 7b7 of section #hje2 7,c7 by redesignating subsection 7d7 as subsection 7e72 and 7,d7 by inserting after subsection 7c7 the following new subsection3 7d7 7#a7 ,except as provided in subsection 7b77#d71 the provisions of this title shall supersede any and all ,state laws insofar as they may now or hereafter preclude1 or have the effect of precluding1 a health insurance issuer from offering health insurance coverage in connection with an association health plan which is certified under part #h4 7#b7 ,except as provided in paragraphs 7#d7 and 7#e7 of subsection 7b7 of this section-- 7,a7 ,in any case in which health insurance coverage of any policy type is offered under an association health plan certified under part #h to a participating employer operating in such ,state1 the provisions of this title shall supersede any and all laws of such ,state insofar as they may preclude a health insurance issuer from offering health insurance coverage of the same policy type to other employers operating in the ,state which are eligible for coverage under such association health plan1 whether or not such other employers are participating employers in such plan4 7,b7 ,in any case in which health insurance coverage of any policy type is offered in a ,state under an association health plan certified under part #h and the filing1 with the applicable ,state authority 7as defined in section #hab7;a77#i771 of the policy form in connection with such policy type is approved by such ,state authority1 the provisions of this title shall supersede any and all laws of any other ,state in which health insurance coverage of such type is offered1 insofar as they may preclude1 upon the filing in the same form and manner of such policy form with the applicable ,state authority in such other ,state1 the approval of the filing in such other ,state4 7#c7 ,nothing in subsection 7b77#f77;,e7 or the preceding provisions of this subsection shall be construed1 with respect to health insurance issuers or health insurance coverage1 to supersede or impair the law of any ,state-- 7,a7 providing solvency standards or similar standards regarding the adequacy of insurer capital1 surplus1 reserves1 or contributions1 or 7,b7 relating to prompt payment of claims4 7#d7 ,for additional provisions relating to association health plans1 see subsections 7a77#b77;,b7 and 7b7 of section #hje4 7#e7 ,for purposes of this subsection1 the term association health plan has the meaning provided in section #hja7;a71 and the terms health insurance coverage1 participating employer1 and health insurance issuer have the meanings provided such terms in section #hab1 respectively4 4 7#c7 ,section #ead7;b77#f77;,a7 of such ,act 7#bi ,u4,s4,c4 #aadd7;b77#f77;,a77 is amended-- 7,a7 in clause 7i77,,ii71 by striking and at the end2 7,b7 in clause 7ii7-- 7i7 by inserting and which does not provide medical care 7within the meaning of section #gcc7;a77#b771 after arrangement12 and 7ii7 by striking title4 and inserting title1 and2 and 7,c7 by adding at the end the following new clause3 7iii7 subject to subparagraph 7,e71 in the case of any other employee welfare benefit plan which is a multiple employer welfare arrangement and which provides medical care 7within the meaning of section #gcc7;a77#b771 any law of any ,state which regulates insurance may apply4 4 7#d7 ,section #ead7;e7 of such ,act 7as redesignated by paragraph 7#b77;,c77 is amended-- 7,a7 by striking ,nothing and inserting 7#a7 ,except as provided in paragraph 7#b71 nothing2 and 7,b7 by adding at the end the following new paragraph3 7#b7 ,nothing in any other provision of law enacted on or after the date of the enactment of the ,obamacare ,replacement ,act shall be construed to alter1 amend1 modify1 invalidate1 impair1 or supersede any provision of this title1 except by specific cross-reference to the affected section4 4 7c7 ,plan ,sponsor ,section #c7af77;,b7 of such ,act 7#bi ,u4,s4,c4 #ajb7af77;,b77 is amended by adding at the end the following new sentence3 ,such term also includes a person serving as the sponsor of an association health plan under part #h of subtitle ,b44 7d7 ,disclosure of ,solvency ,protections ,related to ,self-,insured and ,fully ,insured ,options ,under ,association ,health ,plans ,section #ajb7;b7 of such ,act 7#bi ,u4,s4,c4 #ajbb7;b77 is amended by adding at the end the following3 ,an association health plan shall include in its summary plan description1 in connection with each benefit option1 a description of the form of solvency or guarantee fund protection secured pursuant to this ,act or applicable ,state law1 if any44 7e7 ,savings ,clause ,section #gca7;c7 of such ,act is amended by inserting or part #h after this part4 7f7 ,report to the ,congress ,regarding ,certification of ,self-,insured ,association ,health ,plans ,not later than ,january #a1 #bjah1 the ,secretary of ,labor shall report to the ,committee on ,education and the ,workforce of the ,house of ,representatives and the ,committee on ,health1 ,education1 ,labor1 and ,pensions of the ,senate the effect association health plans have had1 if any1 on reducing the number of uninsured individuals4 7g7 ,clerical ,amendment ,the table of contents in section #a of the ,employee ,retirement ,income ,security ,act of #aigd is amended by inserting after the item relating to section #gcd the following new items3 ,part #h--,rules ,governing ,association ,health ,plans#hja4 ,association health plans4#hjb4 ,certification of association health plans4#hjc4 ,requirements relating to sponsors and boards of trustees4#hjd4 ,participation and coverage requirements4#hje4 ,other requirements relating to plan documents1 contribution rates1 and benefit options4#hjf4 ,maintenance of reserves and provisions for solvency for plans providing health benefits in addition to health insurance coverage4#hjg4 ,requirements for application and related requirements4#hjh4 ,notice requirements for voluntary termination4#hji4 ,corrective actions and mandatory termination4#haj4 ,trusteeship by the ,secretary of insolvent association health plans providing health benefits in addition to health insurance coverage4#haa4 ,state assessment authority4#hab4 ,definitions and rules of construction4 4 #djb4 ,clarification of treatment of single employer arrangements ,section #c7dj77;,b7 of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #ajjb7dj77;,b77 is amended-- 7#a7 in clause 7i71 by inserting after control group1 the following3 except that1 in any case in which the benefit referred to in subparagraph 7,a7 consists of medical care 7as defined in section #hab7;a77#b771 two or more trades or businesses1 whether or not incorporated1 shall be deemed a single employer for any plan year of such plan1 or any fiscal year of such other arrangement1 if such trades or businesses are within the same control group during such year or at any time during the preceding #a-year period12 7#b7 in clause 7iii71 by striking 7iii7 the determination and inserting the following3 7iii7 7,i7 in any case in which the benefit referred to in subparagraph 7,a7 consists of medical care 7as defined in section #hab7;a77#b771 the determination of whether a trade or business is under common control with another trade or business shall be determined under regulations of the ,secretary applying principles consistent and coextensive with the principles applied in determining whether employees of two or more trades or businesses are treated as employed by a single employer under section #djja7;b71 except that1 for purposes of this paragraph1 an interest of greater than #be percent may not be required as the minimum interest necessary for common control1 or 7,,ii7 in any other case1 the determination 2 7#c7 by redesignating clauses 7iv7 and 7v7 as clauses 7v7 and 7vi71 respectively2 and 7#d7 by inserting after clause 7iii7 the following new clause3 7iv7 in any case in which the benefit referred to in subparagraph 7,a7 consists of medical care 7as defined in section #hab7;a77#b771 in determining1 after the application of clause 7i71 whether benefits are provided to employees of two or more employers1 the arrangement shall be treated as having only one participating employer if1 after the application of clause 7i71 the number of individuals who are employees and former employees of any one participating employer and who are covered under the arrangement is greater than #ge percent of the aggregate number of all individuals who are employees or former employees of participating employers and who are covered under the arrangement1 4 #djc4 ,enforcement provisions relating to association health plans 7a7 ,criminal ,penalties for ,certain ,willful ,misrepresentations ,section #eja of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #aaca7 is amended by adding at the end the following new subsection3 7c7 ,any person who willfully falsely represents1 to any employee1 any employee's beneficiary1 any employer1 the ,secretary1 or any ,state1 a plan or other arrangement established or maintained for the purpose of offering or providing any benefit described in section #c7a7 to employees or their beneficiaries as-- 7#a7 being an association health plan which has been certified under part #h2 7#b7 having been established or maintained under or pursuant to one or more collective bargaining agreements which are reached pursuant to collective bargaining described in section #h7;d7 of the ,national ,labor ,relations ,act 7#bi ,u4,s4,c4 #aeh7;d77 or paragraph ,fourth of section #b of the ,railway ,labor ,act 7#de ,u4,s4,c4 #aeb1 paragraph ,fourth7 or which are reached pursuant to labor-management negotiations under similar provisions of ,state public employee relations laws2 or 7#c7 being a plan or arrangement described in section #c7dj77;,a77i71 shall1 upon conviction1 be imprisoned not more than #e years1 be fined under title #ah1 ,united ,states ,code1 or both4 4 7b7 ,cease ,activities ,orders ,section #ejb of such ,act 7#bi ,u4,s4,c4 #aacb7 is amended by adding at the end the following new subsection3 7n7 ,association ,health ,plan ,cease and ,desist ,orders 7#a7 ,in general ,subject to paragraph 7#b71 upon application by the ,secretary showing the operation1 promotion1 or marketing of an association health plan 7or similar arrangement providing benefits consisting of medical care 7as defined in section #gcc7;a77#b777 that-- 7,a7 is not certified under part #h1 is subject under section #ead7;b77#f7 to the insurance laws of any ,state in which the plan or arrangement offers or provides benefits1 and is not licensed1 registered1 or otherwise approved under the insurance laws of such ,state2 or 7,b7 is an association health plan certified under part #h and is not operating in accordance with the requirements under part #h for such certification1 a district court of the ,united ,states shall enter an order requiring that the plan or arrangement cease activities4 7#b7 ,exception ,paragraph 7#a7 shall not apply in the case of an association health plan or other arrangement if the plan or arrangement shows that-- 7,a7 all benefits under it referred to in paragraph 7#a7 consist of health insurance coverage2 and 7,b7 with respect to each ,state in which the plan or arrangement offers or provides benefits1 the plan or arrangement is operating in accordance with applicable ,state laws that are not superseded under section #ead4 7#c7 ,additional equitable relief ,the court may grant such additional equitable relief1 including any relief available under this title1 as it deems necessary to protect the interests of the public and of persons having claims for benefits against the plan4 4 7c7 ,responsibility for ,claims ,procedure ,section #ejc of such ,act 7#bi ,u4,s4,c4 #aacc7 is amended-- 7#a7 by inserting 7a7 ,in general4-- before ,in accordance2 and 7#b7 by adding at the end the following new subsection3 7b7 ,association ,health ,plans ,the terms of each association health plan which is or has been certified under part #h shall require the board of trustees or the named fiduciary 7as applicable7 to ensure that the requirements of this section are met in connection with claims filed under the plan4 4 #djd4 ,cooperation between ,federal and ,state authorities ,section #ejf of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #aacf7 is amended by adding at the end the following new subsection3 7d7 ,consultation ,with ,states ,with ,respect to ,association ,health ,plans 7#a7 ,agreements with states ,the ,secretary shall consult with the ,state recognized under paragraph 7#b7 with respect to an association health plan regarding the exercise of-- 7,a7 the ,secretary's authority under sections #ejb and #ejd to enforce the requirements for certification under part #h2 and 7,b7 the ,secretary's authority to certify association health plans under part #h in accordance with regulations of the ,secretary applicable to certification under part #h4 7#b7 ,recognition of primary domicile state ,in carrying out paragraph 7#a71 the ,secretary shall ensure that only one ,state will be recognized1 with respect to any particular association health plan1 as the ,state with which consultation is required4 ,in carrying out this paragraph-- 7,a7 in the case of a plan which provides health insurance coverage 7as defined in section #hab7;a77#c771 such ,state shall be the ,state with which filing and approval of a policy type offered by the plan was initially obtained2 and 7,b7 in any other case1 the ,secretary shall take into account the places of residence of the participants and beneficiaries under the plan and the ,state in which the trust is maintained4 4 #dje4 ,effective date and transitional and other rules 7a7 ,effective ,date ,the amendments made by this subtitle shall take effect #a year after the date of the enactment of this ,act4 ,the ,secretary of ,labor shall first issue all regulations necessary to carry out the amendments made by this subtitle within #a year after the date of the enactment of this ,act4 7b7 ,treatment of ,certain ,existing ,health ,benefits ,programs 7#a7 ,in general ,in any case in which1 as of the date of the enactment of this ,act1 an arrangement is maintained in a ,state for the purpose of providing benefits consisting of medical care for the employees and beneficiaries of its participating employers1 at least #bjj participating employers make contributions to such arrangement1 such arrangement has been in existence for at least #aj years1 and such arrangement is licensed under the laws of one or more ,states to provide such benefits to its participating employers1 upon the filing with the applicable authority 7as defined in section #hab7;a77#e7 of the ,employee ,retirement ,income ,security ,act of #aigd 7as amended by this subtitle77 by the arrangement of an application for certification of the arrangement under part #h of subtitle ,b of title ,i of such ,act-- 7,a7 such arrangement shall be deemed to be a group health plan for purposes of title ,i of such ,act2 7,b7 the requirements of sections #hja7;a7 and #hjc7;a7 of the ,employee ,retirement ,income ,security ,act of #aigd shall be deemed met with respect to such arrangement2 7,c7 the requirements of section #hjc7;b7 of such ,act shall be deemed met1 if the arrangement is operated by a board of directors which-- 7i7 is elected by the participating employers1 with each employer having one vote2 and 7ii7 has complete fiscal control over the arrangement and which is responsible for all operations of the arrangement2 7,d7 the requirements of section #hjd7;a7 of such ,act shall be deemed met with respect to such arrangement2 and 7,e7 the arrangement may be certified by any applicable authority with respect to its operations in any ,state only if it operates in such ,state on the date of certification4 ,the provisions of this subsection shall cease to apply with respect to any such arrangement at such time after the date of the enactment of this ,act as the applicable requirements of this subsection are not met with respect to such arrangement4 7#b7 ,definitions ,for purposes of this subsection1 the terms group health plan1 medical care1 and participating employer shall have the meanings provided in section #hab of the ,employee ,retirement ,income ,security ,act of #aigd1 except that the reference in subsection 7a77#h7 of such section to an association health plan shall be deemed a reference to an arrangement referred to in this subsection4 ,v ,medicaid reform #eja4 ,increasing ,state flexibility to conduct ,medicaid waivers ,section #aaae7;a77#a7 of the ,social ,security ,act 7#db ,u4,s4,c4 #acae7;a77#a77 is amended-- 7#a7 by striking #afjb1 or #aijb and inserting or #afjb2 and 7#b7 by inserting and shall waive compliance with section #aijb1 after as the case may be14 ,,vi ,miscellaneous provisions #fja4 ,quality health care coalition 7a7 ,application of the ,federal antitrust laws to health care professionals negotiating with health plans 7#a7 ,in general ,any health care professionals who are engaged in negotiations with a health plan regarding the terms of any contract under which the professionals provide health care items or services for which benefits are provided under such plan shall1 in connection with such negotiations1 be exempt from the ,federal antitrust laws4 7#b7 ,limitation 7,a7 ,no new right for collective cessation of service ,the exemption provided in paragraph 7#a7 shall not confer any new right to participate in any collective cessation of service to patients not already permitted by existing law4 7,b7 ,no change in ,national ,labor ,relations ,act ,this section applies only to health care professionals excluded from the ,national ,labor ,relations ,act 7#bi ,u4,s4,c4 #aea et seq474 ,nothing in this section shall be construed as changing or amending any provision of the ,national ,labor ,relations ,act1 or as affecting the status of any group of persons under that ,act4 7#c7 ,no application to ,federal programs ,nothing in this section shall apply to negotiations between health care professionals and health plans pertaining to benefits provided under any of the following3 7,a7 ,the ,medicare program under title ,,xviii of the ,social ,security ,act 7#db ,u4,s4,c4 #acie et seq474 7,b7 ,the ,medicaid program under title ,,xix of the ,social ,security ,act 7#db ,u4,s4,c4 #acif et seq474 7,c7 ,the ,state ,children's ,health ,insurance ,program under title ,,xxi of the ,social ,security ,act 7#db ,u4,s4,c4 #acig;aa et seq474 7,d7 ,chapter #ee of title #aj1 ,united ,states ,code 7relating to medical and dental care for members of the uniformed services74 7,e7 ,chapter #ag of title #ch1 ,united ,states ,code 7relating to ,veterans' medical care74 7,f7 ,chapter #hi of title #e1 ,united ,states ,code 7relating to the ,federal ,employees ,health ,benefits program74 7,g7 ,the ,indian ,health ,care ,improvement ,act 7#be ,u4,s4,c4 #afja et seq474 7b7 ,definitions ,in this section1 the following definitions shall apply3 7#a7 ,antitrust laws ,the term antitrust laws-- 7,a7 has the meaning given it in subsection 7a7 of the first section of the ,clayton ,act 7#ae ,u4,s4,c4 #ab7;a771 except that such term includes section #e of the ,federal ,trade ,commission ,act 7#ae ,u4,s4,c4 #de7 to the extent such section applies to unfair methods of competition2 and 7,b7 includes any ,state law similar to the laws referred to in subparagraph 7,a74 7#b7 ,group health plan ,the term group health plan means an employee welfare benefit plan to the extent that the plan provides medical care 7including items and services paid for as medical care7 to employees or their dependents 7as defined under the terms of the plan7 directly or through insurance1 reimbursement1 or otherwise4 7#c7 ,group health plan1 health insurance issuer ,the terms group health plan and health insurance issuer include a third-party administrator or other person acting for or on behalf of such plan or issuer4 7#d7 ,health care services ,the term health care services means any services for which payment may be made under a health plan1 including services related to the delivery or administration of such services4 7#e7 ,health care professional ,the term health care professional means any individual or entity that provides health care items or services1 treatment1 assistance with activities of daily living1 or medications to patients and who1 to the extent required by ,state or ,federal law1 possesses specialized training that confers expertise in the provision of such items or services1 treatment1 assistance1 or medications4 7#f7 ,health insurance coverage ,the term health insurance coverage means benefits consisting of medical care 7provided directly1 through insurance or reimbursement1 or otherwise and including items and services paid for as medical care7 under any hospital or medical service policy or certificate1 hospital or medical service plan contract1 or health maintenance organization contract offered by a health insurance issuer4 7#g7 ,health insurance issuer ,the term health insurance issuer means an insurance company1 insurance service1 or insurance organization 7including a health maintenance organization7 that is licensed to engage in the business of insurance in a ,state and that is subject to ,state law regulating insurance4 ,such term does not include a group health plan4 7#h7 ,health maintenance organization ,the term health maintenance organization means-- 7,a7 a federally qualified health maintenance organization 7as defined in section #acja7;a7 of the ,public ,health ,service ,act 7#db ,u4,s4,c4 #cjj;e7a7772 7,b7 an organization recognized under ,state law as a health maintenance organization2 or 7,c7 a similar organization regulated under ,state law for solvency in the same manner and to the same extent as such a health maintenance organization4 7#i7 ,health plan ,the term health plan means a group health plan or a health insurance issuer that is offering health insurance coverage4 7#aj7 ,medical care ,the term medical care means amounts paid for-- 7,a7 the diagnosis1 cure1 mitigation1 treatment1 or prevention of disease1 or amounts paid for the purpose of affecting any structure or function of the body2 and 7,b7 transportation primarily for and essential to receiving items and services referred to in subparagraph 7,a74 7#aa7 ,person ,the term person includes a ,state or unit of local government4 7#ab7 ,state ,the term ,state includes the several ,states1 the ,district of ,columbia1 ,puerto ,rico1 the ,virgin ,islands of the ,united ,states1 ,guam1 ,american ,samoa1 and the ,commonwealth of the ,northern ,mariana ,islands4 7c7 ,effective date ,this section shall take effect on the date of the enactment of this ,act and shall not apply with respect to conduct occurring before such date4 #fjb4 ,certain medical stop-loss insurance obtained by certain plan sponsors of group health plans not included under the definition of health insurance coverage 7a7 ,,phsa ,section #bgia7;b77#a7 of the ,public ,health ,service ,act 7#db ,u4,s4,c4 #cjj;gg-#ia7;b77#a77 is amended by adding at the end the following new sentence3 ,such term shall not include a stop loss policy obtained by a self-insured health plan or a plan sponsor of a group health plan that self-insures the health risks of its plan participants to reimburse the plan or sponsor for losses that the plan or sponsor incurs in providing health or medical benefits to such plan participants in excess of a predetermined level set forth in the stop loss policy obtained by such plan or sponsor44 7b7 ,,erisa ,section #gcc7;b77#a7 of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #aaia;b7b77#a77 is amended by adding at the end the following new sentence3 ,such term shall not include a stop loss policy obtained by a self-insured health plan or a plan sponsor of a group health plan that self-insures the health risks of its plan participants to reimburse the plan or sponsor for losses that the plan or sponsor incurs in providing health or medical benefits to such plan participants in excess of a predetermined level set forth in the stop loss policy obtained by such plan or sponsor44 7c7 ,,irc ,section #ihcb7;b77#a77;,a7 of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new sentence3 ,such term shall not include a stop loss policy obtained by a self-insured health plan or a plan sponsor of a group health plan that self-insures the health risks of its plan participants to reimburse the plan or sponsor for losses that the plan or sponsor incurs in providing health or medical benefits to such plan participants in excess of a predetermined level set forth in the stop loss policy obtained by such plan or sponsor44