Health Security Act
Title I
TITLE I_HEALTH CARE SECURITY


table of contents of title


Subtitle A_Universal Coverage and Individual Responsibility
PART 1 UNIVERSAL COVERAGE
Sec._1001._Entitlement to health benefits.
Sec._1002._Individual responsibilities.
Sec._1003._Protection of consumer choice.
Sec._1004._Applicable health plan providing coverage.
Sec._1005._Treatment of other nonimmigrants.
Sec._1006._Effective date of entitlement.
PART 2TREATMENT OF FAMILIES AND SPECIAL RULES
Sec._1011._General rule of enrollment of family in same health plan.
Sec._1012._Treatment of certain families.
Sec._1013._Multiple employment situations.
Sec._1014._Treatment of residents of States with Statewide single-payer systems.
Subtitle B_Benefits
Part 1_Comprehensive Benefit Package
Sec._1101._Provision of comprehensive benefits by plans.
Part 2 escription of Items and Services Covered
Sec._1111._Hospital services.
Sec._1112._Services of health professionals.
Sec._1113._Emergency and ambulatory medical and surgical services.
Sec._1114._Clinical preventive services.
Sec._1115._Mental health and substance abuse services.
Sec._1116._Family planning services and services for pregnant women.
Sec._1117._Hospice care.
Sec._1118._Home health care.
Sec._1119._Extended care services.
Sec._1120._Ambulance services.
Sec._1121._Outpatient laboratory, radiology, and diagnostic services.
Sec._1122._Outpatient prescription drugs and biologicals.
Sec._1123._Outpatient rehabilitation services.
Sec._1124. urable medical equipment and prosthetic and orthotic devices.
Sec._1125._Vision care.
Sec._1126. ental care.
Sec._1127._Health education classes.
Sec._1128._Investigational treatments.
Part 3_Cost Sharing
Sec._1131._Cost sharing.
Sec._1132._Lower cost sharing.
Sec._1133._Higher cost sharing.
Sec._1134._Combination cost sharing.
Sec._1135._Table of copayments and coinsurance.
Sec._1136._Indexing dollar amounts relating to cost sharing.
Part 4_Exclusions
Sec._1141._Exclusions.
Part 5_Role of the National Health Board
Sec._1151. efinition of benefits.
Sec._1152._Acceleration of expanded benefits.
Sec._1153._Authority with respect to clinical preventive services.
Sec._1154._Establishment of standards regarding medical necessity.
Part 6_Additional Provisions Relating to Health Care Providers
Sec._1161._Override of restrictive State practice laws.
Sec._1162._Provision of items or services contrary to religious belief or moral conviction.
Subtitle C_State Responsibilities
Sec._1200._Participating State.
Part 1_General State Responsibilities
Sec._1201._General State responsibilities.
Sec._1202._State responsibilities with respect to alliances.
Sec._1203._State responsibilities relating to health plans.
Sec._1204._Financial solvency; fiscal oversight; guaranty fund.
Sec._1205._Restrictions on funding of additional benefits.
Part 2_Requirements for State Single-payer Systems
Sec._1221._Single-payer system described.
Sec._1222._General requirements for single-payer systems.
Sec._1223._Special rules for States operating Statewide single-payer system.
Sec._1224._Special rules for alliance-specific single-payer systems.
Subtitle D_Health Alliances
Sec._1300._Health alliance defined.
Part 1_Establishment of Regional and Corporate Alliances
Subpart A_Regional Alliances
Sec._1301._Regional alliance defined.
Sec._1302._Board of directors.
Sec._1303._Provider advisory boards for regional alliances.
Subpart B_Corporate Alliances
Sec._1311._Corporate alliance defined; individuals eligible for coverage through corporate alliances; additional definitions.
Sec._1312._Timing of elections.
Sec._1313._Termination of alliance election.
Part 2_General Responsibilities and Authorities of Regional Alliances
Sec._1321._Contracts with health plans.
Sec._1322._Offering choice of health plans for enrollment; establishment of fee-for-service schedule.
Sec._1323._Enrollment rules and procedures.
Sec._1324._Issuance of health security cards.
Sec._1325._Consumer information and marketing.
Sec._1326._Ombudsman.
Sec._1327. ata collection; quality.
Sec._1328._Additional duties.
Sec._1329._Additional authorities for regional alliances to address needs in areas with inadequate health services; prohibition of insurance role.
Sec._1330._Prohibition against self-dealing and conflicts of interest.
Part 3_Authorities and Responsibilities Relating to Financing and Income Determinations
SUBPART A_COLLECTION OF FUNDS
Sec._1341._Information and negotiation and acceptance of bids.
Sec._1342._Amount of premiums charged.
Sec._1343. etermination of family obligation for family share and alliance credit amount.
Sec._1344._Notice of family payments due.
Sec._1345._Collection of premium payments.
Sec._1346._Coordination among regional alliances.
SUBPART B_PAYMENTS
Sec._1351._Payment to regional alliance health plans.
Sec._1352._Alliance administrative allowance percentage.
Sec._1353._Payments for graduate medical education and academic health centers.
SUBPART C_FINANCIAL MANAGEMENT
Sec._1361._Management of finances and records.
SUBPART D_REDUCTIONS IN COST SHARING; INCOME DETERMINATIONS
Sec._1371._Reduction in cost sharing for low-income families.
Sec._1372._Application process for cost sharing reductions.
Sec._1373._Application for premium reductions and reduction in liability to alliance.
Sec._1374._General provisions relating to application process.
Sec._1375._End-of-year reconciliation for premium discount and repayment reduction with actual income.
Part 4_Responsibilities and Authorities of Corporate Alliances
Sec._1381._Contracts with health plans.
Sec._1382._Offering choice of health plans for enrollment.
Sec._1383._Enrollment; issuance of health security card.
Sec._1384._Community-rated premiums within premium areas.
Sec._1385._Assistance for low-wage families.
Sec._1386._Consumer information and marketing; consumer assistance; data collection and quality; additional duties.
Sec._1387._Plan and information requirements.
Sec._1388._Management of funds; relations with employees.
Sec._1389._Cost control.
Sec._1390._Payments by corporate alliance employers to corporate alliances.
Sec._1391._Coordination of payments.
Sec._1392._Applicability of ERISA enforcement mechanisms for enforcement of certain requirements.
Sec._1393._Applicability of certain ERISA protections to covered individuals.
Sec._1394. isclosure and reserve requirements.
Sec._1395._Trusteeship by the Secretary of insolvent corporate alliance health plans.
Sec._1396._Guaranteed benefits under trusteeship of the secretary.
Sec._1397._Imposition and collection of periodic assessments on self-insured corporate alliance plans.
Subtitle E_Health Plans
Sec._1400._Health plan defined.
Part 1_Requirements Relating to Comprehensive Benefit Package
Sec._1401._Application of requirements.
Sec._1402._Requirements relating to enrollment and coverage.
Sec._1403._Community rating.
Sec._1404._Marketing of health plans; information.
Sec._1405._Grievance procedure.
Sec._1406._Health plan arrangements with providers.
Sec._1407._Preemption of certain State laws relating to health plans.
Sec._1408._Financial solvency.
Sec._1409._Requirement for offering cost sharing policy.
Sec._1410._Quality assurance.
Sec._1411._Provider verification.
Sec._1412._Consumer disclosures of utilization management protocols.
Sec._1413._Confidentiality, data management, and reporting.
Sec._1414._Participation in reinsurance system.
Part 2_Requirements Relating to Supplemental Insurance
Sec._1421._Imposition of requirements on supplemental insurance.
Sec._1422._Standards for supplemental health benefit policies.
Sec._1423._Standards for cost sharing policies.
Part 3_Requirements Relating to Essential Community Providers
Sec._1431._Health plan requirement.
Sec._1432._Sunset of requirement.
Part 4_Requirements Relating to Workers' Compensation and Automobile Medical Liability Coverage
Sec._1441._Reference to requirements relating to workers compensation services.
Sec._1442._Reference to requirements relating to automobile medical liability services.
Subtitle F_Federal Responsibilities
Part 1_National Health Board
SUBPART A_ESTABLISHMENT OF NATIONAL HEALTH BOARD
Sec._1501._Creation of National Health Board; membership.
Sec._1502._Qualifications of board members.
Sec._1503._General duties and responsibilities.
Sec._1504._Annual report.
Sec._1505._Powers.
Sec._1506._Funding.
SUBPART B_RESPONSIBILITIES RELATING TO REVIEW AND APPROVAL OF STATE SYSTEMS
Sec._1511._Federal review and action on State systems.
Sec._1512._Failure of participating States to meet conditions for compliance.
Sec._1513._Reduction in payments for health programs by secretary of health and human services.
Sec._1514._Review of Federal determinations.
Sec._1515._Federal support for State implementation.
SUBPART C_RESPONSIBILITIES IN ABSENCE OF STATE SYSTEMS
Sec._1521._Application of subpart.
Sec._1522._Federal assumption of responsibilities in non-participating States.
Sec._1523._Imposition of surcharge on premiums under federally-operated system.
Sec._1524._Return to State operation.
SUBPART D_ESTABLISHMENT OF CLASS FACTORS FOR CHARGING PREMIUMS
Sec._1531._Premium class factors.
SUBPART E_RISK ADJUSTMENT AND REINSURANCE METHODOLOGY FOR PAYMENT OF PLANS
Sec._1541. evelopment of a risk adjustment and reinsurance methodology.
Sec._1542._Incentives to enroll disadvantaged groups.
Sec._1543._Advisory committee.
Sec._1544._Research and demonstrations.
Sec._1545._Technical assistance to States and alliances.
SUBPART F_RESPONSIBILITIES FOR FINANCIAL REQUIREMENTS
Sec._1551._Capital standards for regional alliance health plan.
Sec._1552._Standard for guaranty funds.
Part 2_Responsibilities of Department of Health and Human Services
SUBPART A_GENERAL RESPONSIBILITIES
Sec._1571._General responsibilities of Secretary of Health and Human Services.
Sec._1572._Establishment of breakthrough drug committee.
SUBPART B_CERTIFICATION OF ESSENTIAL COMMUNITY PROVIDERS
Sec._1581._Certification.
Sec._1582._Categories of providers automatically certified.
Sec._1583._Standards for additional providers.
Sec._1584._Certification process; review; termination of certifications.
Sec._1585._Notification of health alliances and participating States.
Part 3_Specific Responsibilities of Secretary of Labor.
Sec._1591._Responsibilities of Secretary of Labor.
Subtitle G_Employer Responsiblities
Sec._1601._Payment requirement.
Sec._1602._Requirement for information reporting.
Sec._1603._Requirements relating to new employees.
Sec._1604._Auditing of records.
Sec._1605._Prohibition of certain employer discrimination.
Sec._1606._Obligation relating to retiree health benefits. [THIS SECTION TO FOLLOW] 
Sec._1607._Prohibition on self-funding of cost sharing benefits by regional alliance employers.
Subtitle J_General Definitions; Miscellaneous Provisions
Part 1_General Definitions
Sec._1901. efinitions relating to employment and income.
Sec._1902._Other general definitions.
Part 2_Miscellaneous Provisions
Sec._1911._Use of interim, final regulations.



Title I, Subtitle A
TITLE I_HEALTH CARE SECURITY
Subtitle A_Universal Coverage and Individual Responsibility
PART 1_UNIVERSAL COVERAGE
SEC. 1001. ENTITLEMENT TO HEALTH BENEFITS.
__(a) In General._In accordance with this part, each eligible individual is entitled to the comprehensive benefit package under subtitle B through the applicable health plan in which the individual is enrolled consistent with this title.
__(b) Health Security Card._Each eligible individual is entitled to a health security card to be issued by the alliance or other entity that offers the applicable health plan in which the individual is enrolled. 
__(c) Eligible Individual Defined._In this Act, the term ``eligible individual'' means an individual who is residing in the United States  and who is_
__(1) a citizen or national of the United States;
__(2) an alien permanently residing in the United States under color of law (as defined in section 1902(1)); or
__(3) a long-term nonimmigrant (as defined in section 1902(19)).
__(d) Treatment of Medicare-Eligible Individuals._Subject to section 1012(a), a medicare-eligible individual is entitled to health benefits under the medicare program instead of the entitlement under subsection (a).
__(e) Treatment of Prisoners._A prisoner (as defined in section 1902(26)) is entitled to health care services provided by the authority responsible for the prisoner instead of the entitlement under subsection (a).

SEC. 1002. INDIVIDUAL RESPONSIBILITIES.
__(a) In General._In accordance with this Act, each eligible individual (other than a medicare-eligible individual)_
__(1) must enroll in an applicable health plan for the individual, and
__(2) must pay any premium required, consistent with this Act, with respect to such enrollment.
__(b) Limitation on Disenrollment._No eligible individual shall be disenrolled from an applicable health plan until the individual_
__(1) is enrolled under another applicable health plan, or
__(2) becomes a medicare-eligible individual.
SEC. 1003. PROTECTION OF CONSUMER CHOICE.
__Nothing in this Act shall be construed as prohibiting the following:
__(1) An individual from purchasing any health care services.
__(2) An individual from purchasing supplemental insurance (offered consistent with this Act) to cover health care services not included within the comprehensive benefit package.
__(3) An individual who is not an eligible individual from purchasing health insurance (other than through a regional alliance).
__(4) Employers from providing coverage for benefits in addition to the comprehensive benefit package (subject to part 2 of subtitle E).
SEC. 1004. APPLICABLE HEALTH PLAN PROVIDING COVERAGE.
__(a) Specification of Applicable Health Plan._Except as otherwise provided:
__(1) General rule: regional alliance health plans._The applicable health plan for a family is a regional alliance health plan for the alliance area in which the family resides.
__(2) Corporate alliance health plans._In the case of a family member that is eligible to enroll in a corporate alliance health plan under section 1311(c), the applicable health plan for the family is such a corporate alliance health plan.
__(b) Choice of Plans for Certain Groups._
__(1) Military personnel and families._For military personnel and families who elect a Uniformed Services Health Plan of the Department of Defense under section 1073a(d) of title 10, United States Code, as inserted by section 8001(a) of this Act, that plan shall be the applicable health plan.
__(2) Veterans._For veterans and families who elect to enroll in a veterans health plan under section 1801 of title 38, United States Code, as inserted by section 8101(a) of this Act, that plan shall be the applicable health plan.
__(3) Indians._For those individuals who are eligible to enroll, and who elect to enroll, in a health program of the Indian Health Service under section 8302(b), that program shall be the applicable health plan.

SEC. 1005. TREATMENT OF OTHER NONIMMIGRANTS.
__(a) Undocumented Aliens Ineligible for Benefits._An undocumented alien is not eligible to obtain the comprehensive benefit package through enrollment in a health plan pursuant to this Act.
__(b) Diplomats and Other Foreign Government Officials._Subject to conditions established by the National Health Board in consultation with the Secretary of State, a nonimmigrant under subparagraph (A) or (G) of section 101(a)(15) of the Immigration and Nationality Act may obtain the comprehensive benefit package through enrollment in the regional alliance health plan for the alliance area in which the nonimmigrant resides.
__(c) Reciprocal Treatment of Other Nonimmigrants._With respect to those classes of individuals who are lawful nonimmigrants but who are not long-term nonimmigrants (as defined in section 1902(19)) or described in subsection (b), such individuals may obtain such benefits through enrollment with regional alliance health plans only in accordance with such reciprocal agreements between the United States and foreign states as may be entered into.
SEC. 1006. EFFECTIVE DATE OF ENTITLEMENT.
__(a) Regional Alliance Eligible Individuals._
__(1) In general._In the case of regional alliance eligible individuals residing in a State, the entitlement under this part (and requirements under section 1002) shall not take effect until the State becomes a participating State (as defined in section 1200).
__(2) Transitional rule for corporate alliances._
__(A) In general._In the case of a State that becomes a participating State before the general effective date (as defined in subsection (c)) and for periods before such date, under rules established by the Board, an individual who is covered under an employee benefit plan (described in subparagraph (C)) based on the individual (or the individual's spouse) being a qualifying employee of a qualifying employer, the individual shall not be treated under this Act as a regional alliance eligible individual.
__(B) Qualifying employer defined._In subparagraph (A), the term ``qualifying employer'' means an employer that_
__(i) is described in section 1311(b)(1)(A), or is participating in a multiemployer plan described in section 1311(b)(1)(B) or arrangement described in section 1311(b)(1)(C), and
__(ii) provides such notice to the regional alliance involved as the Board specifies.
__(C) Benefits plan described._A plan described in this subparagraph is an employee benefit plan that_
__(i) provides (through insurance or otherwise) the comprehensive benefit package, and
__(ii) provides an employer contribution of at least 80 percent of the premium (or premium equivalent) for coverage 
__(b) Corporate Alliance Eligible Individuals._
__(1) In general._In the case of corporate alliance eligible individuals, the entitlement under this part shall not take effect until the general effective date.
__(2) Transition._For purposes of this Act and before the general effective date, in the case of an eligible individual who resides in a participating State, the individual is deemed a regional alliance eligible individual until the individual becomes a corporate alliance eligible individual, unless paragraph (2)(A) applies to the individual.
__(c) General Effective Date Defined._In this Act, the term ``general effective date'' means January 1, 1998.
PART 2_TREATMENT OF FAMILIES AND SPECIAL RULES
SEC. 1011. GENERAL RULE OF ENROLLMENT OF FAMILY IN SAME HEALTH PLAN.
__(a) In General._Except as provided in this part or otherwise, all members of the same family (as defined in subsection (b)) shall be enrolled in the same applicable health plan.
__(b) Family Defined._In this Act, unless otherwise provided, the term ``family''_
__(1) means, with respect to an eligible individual who is not a child (as defined in subsection (c)), the individual; and
__(2) includes the following persons (if any):
__(A) The individual's spouse if the spouse is an eligible individual.
__(B) The individual's children (and, if applicable, the children of the individual's spouse) if they are eligible individuals.
__(c) Classes of Family Enrollment; Terminology._
__(1) In general._In this Act, each of the following is a separate class of family enrollment under this Act:
__(A) Coverage only of an individual (referred to in this Act as the ``individual'' class of enrollment).
__(B) Coverage of a married couple without children (referred to in this Act as the ``couple-only'' class of enrollment).
__(C) Coverage of an unmarried individual and one or more children (referred to in this Act as the ``single parent'' class of enrollment).
__(D) Coverage of a married couple and one or more children (referred to in this Act as the ``dual parent'' class of enrollment).
__(2) References to family and couple classes of enrollment._In this Act:
__(A) Family._The term ``family'', with respect to a class of enrollment, refers to enrollment in a class of enrollment described in subparagraph (B), (C), or (D) of paragraph (1).
__(B) Couple._The term ``couple'', with respect to a class of enrollment, refers to enrollment in a class of enrollment described in subparagraph (B) or (D) of paragraph (1).
__(d) Spouse; Married; Couple._
__(1) In general._In this Act, the terms ``spouse'' and ``married'' mean, with respect to a person, another individual who is the spouse of the person or married to the person, as determined under applicable State law.
__(2) Couple._The term ``couple'' means an individual and the individual's spouse.
__(e) Child Defined._
__(1) In general._In this Act, except as otherwise provided, the term ``child'' means an eligible individual who (consistent with paragraph (3))_
__(A) is under 18 years of age (or under 24 years of age in the case of a full-time student), and
__(B) is a dependent of an eligible individual.
__(2) Application of State law._Subject to paragraph (3), determinations of whether a person is the child of another person shall be made in accordance with applicable State law.
__(3) National rules._The National Health Board may establish such national rules respecting individuals who will be treated as children as the Board determines to be necessary. Such rules shall be consistent with the following principles:
__(A) Step and foster child._A child includes a step child or foster child who is an eligible individual living with an adult in a regular parent-child relationship.
__(B) Disabled child._A child includes an unmarried dependent eligible individual regardless of age who is incapable of self-support because of mental or physical disability which existed before age 21.
__(C) Certain 3-generation families._A child includes the grandchild of an individual, if the parent of the grandchild is a child and the parent and grandchild are living with the grandparent.
__(D) Treatment of emancipated minors and married individuals._An emancipated minor or married individual shall not be treated as a child.
__(f) Additional Rules._The Board shall provide for such additional exceptions and special rules, including rules relating to_
__(1) families in which members are not residing in the same area,
__(2) the treatment of individuals who are under 19 years of age and who are not a dependent of an eligible individual, and
__(3) changes in family composition occurring during a year,
as the Board finds appropriate.
SEC. 1012. TREATMENT OF CERTAIN FAMILIES.
__(a) Treatment of Medicare-Eligible Individuals Who are Qualified Employees or Spouses of Qualified Employees._
__(1) In general._Except as specifically provided, in the case of an individual who is an individual described in paragraph (2) with respect to 2 consecutive months in a year (and it is anticipated would be in the following month), the individual shall not be treated as a medicare-eligible individual under this Act during the following month and the remainder of the year.
__(2) Individual described._An individual described in this paragraph with respect to a month is a medicare-eligible individual (determined without regard to paragraph (1)) who is a qualifying employee or the spouse or family member of a qualifying employee in the month.
__(3) Exception._Paragraph (1) shall not apply, in the case of an individual, if the individual described in paragraph (2) terminates qualifying employment in the month preceding the first month in which paragraph (1) applies. The previous sentence shall apply until with respect to qualifying employment occurring before such first month.





__(b) Separate Treatment for Certain Groups of Individuals._In the case of a family that includes one or more individuals in a group described in subsection (c)_
__(1) all the individuals in each such group within the family shall be treated as a separate family, and
__(2) all the individuals not described in any such group shall be treated collectively as a separate family.
__(c) Groups of Individuals Described._Each of the following is a group of individuals described in this subsection:
__(1) AFDC recipients (as defined in section 1902(3)).
__(2) Disabled SSI recipients (as defined in section 1902(13)) .
__(3) SSI recipients who are not disabled SSI recipients.
__(4) Electing veterans (as defined in subsection (d)(1)).
__(5) Active duty military personnel (as defined in subsection (d)(2)).
__(6) Electing Indians (as defined in subsection (d)(3)).
__(7) Prisoners (as defined in section 1902(26)).
__(d) Special Rules._In this Act:
__(1) Electing veterans._
__(A) Defined._Subject to subparagraph (B), the term ``electing veteran'' means a veteran who makes an election to enroll with a health plan of the Department of Veterans Affairs under chapter 18 of title 38, United States Code.
__(B) Family exception._Subparagraph (A) shall not apply with respect to coverage under a health plan referred to in such subparagraph if, for the area in which the electing veteran resides, such health plan offers coverage to family members of an electing veteran and the veteran elects family enrollment under such plan (instead of individual enrollment).
__(2) Active duty military personnel._
__(A) In general._Subject to subparagraph (B), the term ``active duty military personnel'' means an individual on active duty in the Uniformed Services of the United States.
__(B) Exception._If an individual described in subparagraph (A) elects family coverage under section 1073a(d)(1) of title 10, United States Code, then paragraph (5) of subsection (c) shall not apply with respect to such coverage.
__(3) Electing indians._
__(A) In general._Subject to subparagraph (B), the term ``electing Indian'' means an eligible individual who makes an election under section 8302(b) of this Act.
__(B) Family election for all individuals eligible to elect._No such election shall be made with respect to an individual in a family (as defined without regard to this section) unless such election is made for all eligible individuals (described in section 8302(a)) who are family members of the family.
__(4) Multiple choice._Eligible individuals who are permitted to elect coverage under more than one health plan or program referred to in this subsection may elect which of such plans or programs will be the applicable health plan under this Act.


__(e) Qualifying Students._
__(1) In general._In the case of a qualifying student (described in paragraph (2)), the individual may elect to enroll in a regional alliance health plan offered by the regional alliance for the area in which the school is located.
__(2) Qualifying student._In paragraph (1), the term ``qualifying student'' means an individual who_
__(A) but for this subsection would receive coverage under a health plan as a child of another person, and
__(B) is a full-time student at a school in an alliance area that is different from the alliance area (or, in the case of a corporate alliance, such coverage area as the Board may specify) providing the coverage described in subparagraph (A).
_(3) Payment rules._
__(A) Continued treatment as family._Except as provided in subparagraph (B), nothing in this subsection shall be construed as affecting the payment liabilities between families and health alliances or between health alliances and health plans.
__(B) Transfer payment._In the case of an election under paragraph (1), the health plan described in paragraph (2)(A) shall make payment to the health plan referred to in paragraph (1) in accordance with rules specified by the Board.
__(f) Spouses Living in Different Alliance Areas._The Board shall provide for such special rules in applying this Act in the case of a couple in which the spouses reside in different alliance areas as the Board finds appropriate.
SEC. 1013. MULTIPLE EMPLOYMENT SITUATIONS.
__(a) Multiple Employment of an Individual._In the case of an individual who_
__(1)(A) is not married or (B) is married and whose spouse is not a qualifying employee (as defined in section 6121(c)(1)),
__(2) is not a child, and
__(3) who is a qualifying employee both of a regional alliance employer and of a corporate alliance employer (or of 2 corporate alliance employers),
the individual may elect the applicable health plan to be either a regional alliance health plan (for the alliance area in which the individual resides) or a corporate alliance health plan (for an employer employing the individual).
__(b) Multiple Employment Within a Family._
__(1) Married couple with employment with a regional alliance employer and with a corporate alliance employer._In the case of a married individual_
__(A) who is a qualifying employee of a regional alliance employer and whose spouse is an qualifying employee of a corporate alliance employer, or
__(B) who is a qualifying employee of a corporate alliance employer and whose spouse is an qualifying employee of a regional alliance employer,
the individual and the individual's spouse may elect the applicable health plan to be either a regional alliance health plan (for the alliance area in which the couple resides) or a corporate alliance health plan (for an employer employing the individual or the spouse).
__(2) Married couple with different corporate alliance employers._In the case of a married individual_
__(A) who is a qualifying employee of a corporate alliance employer, and
__(B) whose spouse is a qualifying employee of a different corporate alliance employer,
the individual and the individual's spouse may elect the applicable health plan to be a corporate alliance health plan for an employer employing either the individual or the spouse.
SEC. 1014. TREATMENT OF RESIDENTS OF STATES WITH STATEWIDE SINGLE-PAYER SYSTEMS.
__(a) Universal Coverage._Notwithstanding the previous provisions of this title, except as provided in part 2 of subtitle C, in the case of an individual who resides in a State that has a Statewide single-payer system under section 1223, universal coverage shall be provided consistent with section 1222(3).

__(b) Individual Responsibilities._In the case of an individual who resides in a single-payer State, the responsibilities of such individual under such system shall supersede the obligations of the individual under section 1002.

Title I, Subtitle B
Subtitle B_Benefits
PART 1_COMPREHENSIVE BENEFIT PACKAGE
SEC. 1101. PROVISION OF COMPREHENSIVE BENEFITS BY PLANS.
__(a) In General._The comprehensive benefit package shall consist of the following items and services (as described in part 2), subject to the cost sharing requirements described in part 3, the exclusions described in part 4, and the duties and authority of the National Health Board described in part 5:
__(1) Hospital services (described in section 1111).
__(2) Services of health professionals (described in section 1112).
__(3) Emergency and ambulatory medical and surgical services (described in section 1113).
__(4) Clinical preventive services (described in section 1114).
__(5) Mental health and substance abuse services (described in section 1115).
__(6) Family planning services and services for pregnant women (described in section 1116).
__(7) Hospice care (described in section 1117).
__(8) Home health care (described in section 1118).
__(9) Extended care services (described in section 1119).
__(10) Ambulance services (described in section 1120).
__(11) Outpatient laboratory, radiology, and diagnostic services (described in section 1121).
__(12) Outpatient prescription drugs and biologicals (described in section 1122).
__(13) Outpatient rehabilitation services (described in section 1123).
__(14) Durable medical equipment and prosthetic and orthotic devices (described in section 1124).
__(15) Vision care (described in section 1125).
__(16) Dental care (described in section 1126).
__(17) Health education classes (described in section 1127).
__(18) Investigational treatments (described in section 1128).
__(b) No Other Limitations or Cost Sharing._The items and services in the comprehensive benefit package shall not be subject to any duration or scope limitation or any deductible, copayment, or coinsurance amount that is not required or authorized under this Act.
__(c) Health Plan._Unless otherwise provided in this subtitle, for purposes of this subtitle, the term ``health plan'' has the meaning given such term in section 1400.
PART 2 ESCRIPTION OF ITEMS AND SERVICES COVERED
SEC. 1111. HOSPITAL SERVICES.
__(a) Coverage._The hospital services described in this section are the following items and services:
__(1) Inpatient hospital services.
__(2) Outpatient hospital services.
__(3) 24-hour a day hospital emergency services.
__(b) Limitation._The hospital services described in this section do not include hospital services provided for the treatment of a mental or substance abuse disorder (which are subject to section 1115), except for medical detoxification as required for the management of medical conditions associated with withdrawal from alcohol or drugs (which is not covered under such section).
__(c) Definitions._For purposes of this subtitle:
__(1) Hospital._The term ``hospital'' has the meaning given such term in section 1861(e) of the Social Security Act, except that such term shall include_
__(A) in the case of an item or service provided to an individual whose applicable health plan is specified pursuant to section 1004(b)(1), a facility of the uniformed services under title 10, United States Code, that is primarily engaged in providing services to inpatients that are equivalent to the services provided by a hospital defined in section 1861(e);
__(B) in the case of an item or service provided to an individual whose applicable health plan is specified pursuant to section 1004(b)(2), a facility operated by the Department of Veterans Affairs that is primarily engaged in providing services to inpatients that are equivalent to the services provided by a hospital defined in section 1861(e); and
__(C) in the case of an item or service provided to an individual whose applicable health plan is specified pursuant to section 1004(b)(3), a facility operated by the Indian Health Service that is primarily engaged in providing services to inpatients that are equivalent to the services provided by a hospital defined in section 1861(e).
__(2) Inpatient hospital services._The term ``inpatient hospital services'' means items and services described in paragraphs (1) through (3) of section 1861(b) of the Social Security Act when provided to an inpatient of a hospital. The National Health Board shall specify those health professional services described in section 1112 that shall be treated as inpatient hospital services when provided to an inpatient of a hospital.
SEC. 1112. SERVICES OF HEALTH PROFESSIONALS.
__(a) Coverage._The items and services described in this section are_
__(1) inpatient and outpatient health professional services, including consultations, that are provided in_
__(A) a home, office, or other ambulatory care setting; or
__(B) an institutional setting; and
__(2) services and supplies (including drugs and biologicals which cannot be self-administered) furnished as an incident to such health professional services, of kinds which are commonly furnished in the office of a health professional and are commonly either rendered without charge or included in the bill of such professional.
__(b) Limitation._The items and services described in this section do not include items or services that are described in any other section of this part. An item or service that is described in section 1114 but is not provided consistent with a periodicity schedule for such item or service specified in such section or under section 1153 may be covered under this section if the item or service otherwise meets the requirements of this section.
__(c) Definitions._Unless otherwise provided in this Act, for purposes of this Act:
__(1) Health Professional._The term ``health professional'' means an individual who provides health professional services.
__(2) Health Professional Services._The term ``health professional services'' means professional services that_
__(A) are lawfully provided by a physician; or
__(B) would be described in subparagraph (A) if provided by a physician, but are provided by another person who is legally authorized to provide such services in the State in which the services are provided.
SEC. 1113. EMERGENCY AND AMBULATORY MEDICAL AND SURGICAL SERVICES.
__The emergency and ambulatory medical and surgical services described in this section are the following items and services provided by a health facility that is not a hospital and that is legally authorized to provide the services in the State in which they are provided:
__(1) 24-hour a day emergency services.
__(2) Ambulatory medical and surgical services.
SEC. 1114. CLINICAL PREVENTIVE SERVICES.
__(a) Coverage._The clinical preventive services described in this section are_
__(1) an item or service for high risk populations (as defined by the National Health Board) that is specified and defined by the Board under section 1153, but only when the item or service is provided consistent with any periodicity schedule for the item or service promulgated by the Board;
__(2) except as modified by the National Health Board under section 1153, an age-appropriate immunization, test, or clinician visit specified in one of subsections (b) through (h) that is provided consistent with any periodicity schedule for the item or service specified in the applicable subsection or by the National Health Board under section 1153; and
__(3) an immunization, test, or clinician visit that is provided to an individual during an age range other than the age range for such immunization, test, or clinician visit that is specified in one of subsections (b) through (h), but only when provided consistent with any requirements for such immunizations, tests, and clinician visits established by the National Health Board under section 1153.
__(b) Individuals Under 3._For an individual under 3 years of age:
__(1) Immunizations._The immunizations specified in this subsection are age-appropriate immunizations for the following illnesses:
__(A) Diphtheria.
__(B) Tetanus.
__(C) Pertussis.
__(D) Polio.
__(E) Haemophilus influenzae type B.
__(F) Measles.
__(G) Mumps.
__(H) Rubella.
__(I) Hepatitis B.
__(2) Tests._The tests specified in this subsection are as follows:
__(A) 1 hematocrit.
__(B) 2 blood tests to screen for blood lead levels for individuals who are at risk for lead exposure.
__(3) Clinician visits._The clinician visits specified in this subsection are 1 clinician visit for an individual who is newborn and 7 other clinician visits.
__(c) Individuals Age 3 to 5._For an individual at least 3 years of age, but less than 6 years of age:
__(1) Immunizations._The immunizations specified in this subsection are age-appropriate immunizations for the following illnesses:
__(A) Diphtheria.
__(B) Tetanus.
__(C) Pertussis.
__(D) Polio.
__(E) Measles.
__(F) Mumps.
__(G) Rubella.
__(2) Tests._The tests specified in this subsection are 1 urinalysis.
__(3) Clinician visits._The clinician visits specified in this subsection are 3 clinician visits.
__(d) Individuals Age 6 to 19._For an individual at least 6 years of age, but less than 20 years of age:
__(1) Immunizations._The immunizations specified in this subsection are age-appropriate immunizations for the following illnesses:
__(A) Tetanus.
__(B) Diphtheria.
__(2) Tests._The tests specified in this subsection are as follows:
__(A) Papanicolaou smears and pelvic exams for females who have reached childbearing age and are at risk for cervical cancer every 3 years, but_
__(i) annually until 3 consecutive negative smears have been obtained; and
__(ii) annually for females who are at risk for fertility related infectious illnesses.
__(B) Annual screening for chlamydia and gonorrhea for females who have reached childbearing age and are at risk for fertility related infectious illnesses.
__(3) Clinician visits._The clinician visits specified in this subsection are 5 clinician visits.
__(e) Individuals Age 20 to 39._For an individual at least 20 years of age, but less than 40 years of age:
__(1) Immunizations._The immunizations specified in this subsection are booster immunizations against tetanus and diphtheria every 10 years.
__(2) Tests._The tests specified in this subsection are as follows:
__(A) Papanicolaou smears and pelvic exams for females every 3 years, but_ 
__(i) annually if an abnormal smear has been obtained, until 3 consecutive negative smears have been obtained; and
__(ii) annually for females who are at risk for fertility related infectious illnesses.
__(B) Annual screening for chlamydia and gonorrhea for females who are at risk for fertility related infectious illnesses.
__(C) Cholesterol every 5 years.
__(3) Clinician visits._The clinician visits specified in this subsection are 1 clinician visit every 3 years.
__(f) Individuals Age 40 to 49._For an individual at least 40 years of age, but less than 50 years of age:
__(1) Immunizations._The immunizations specified in this subsection are booster immunizations against tetanus and diphtheria every 10 years.
__(2) Tests._The tests specified in this subsection are as follows:
__(A) Papanicolaou smears and pelvic exams for females every 2 years, but_ 
__(i) annually if an abnormal smear has been obtained, until 3 consecutive negative smears have been obtained; and
__(ii) annually for females who are at risk for fertility related infectious illnesses.
__(B) Annual screening for chlamydia and gonorrhea for females who are at risk for fertility related infectious illnesses.
__(C) Cholesterol every 5 years.
__(3) Clinician visits._The clinician visits specified in this subsection are 1 clinician visit every 2 years.
__(g) Individuals Age 50 to 65._For an individual at least 50 years of age, but less than 65 years of age:
__(1) Immunizations._The immunizations specified in this subsection are booster immunizations against tetanus and diphtheria every 10 years.
__(2) Tests._The tests specified in this subsection are as follows:
__(A) Papanicolaou smears and pelvic exams for females every 2 years.
__(B) Mammograms for females every 2 years.
__(C) Cholesterol every 5 years.
__(3) Clinician visits._The clinician visits specified in this subsection are 1 clinician visit every 2 years.
__(h) Individuals Age 65 or Older._For an individual at least 65 years of age who is enrolled under a health plan:
__(1) Immunizations._The immunizations specified in this subsection are as follows:
__(A) Booster immunizations against tetanus and diphtheria every 10 years.
__(B) Age-appropriate immunizations for the following illnesses:
__(i) Influenza.
__(ii) Pneumococcal invasive disease.
__(2) Tests._The tests specified in this subsection are as follows:
__(A) Papanicolaou smears and pelvic exams for females who are at risk for cervical cancer every 2 years.
__(B) Mammograms for females every 2 years.
__(C) Cholesterol every 5 years.
__(3) Clinician visits._The clinician visits specified in this subsection are 1 clinician visit every year.
__(i) Clinician Visit._For purposes of this section, the term ``clinician visit'' includes the following health professional services (as defined in section 1112(c)):
__(1) A complete medical history.
__(2) An appropriate physical examination.
__(3) Risk assessment.
__(4) Targeted health advice and counseling, including nutrition counseling.
__(5) The administration of age-appropriate immunizations and tests specified in subsections (b) through (h).
__(j) Immunizations and Tests Not Administered During Clinician Visit._Notwithstanding subsection (i)(5), the clinical preventive services described in this section include an immunization or test described in this section that is administered to an individual consistent with any periodicity schedule for the immunization or test during the age range specified for the immunization or test, and any administration fee for such immunization or test, even if the immunization or test is not administered during a clinician visit.
SEC. 1115. MENTAL HEALTH AND SUBSTANCE ABUSE SERVICES.
__(a) Coverage._The mental health and substance abuse services that are described in this section are the following items and services for eligible individuals, as defined in section 1001(c), who satisfy the eligibility requirements in subsection (b):
__(1) Inpatient and residential mental health and substance abuse treatment.
__(2) Intensive nonresidential mental health and substance abuse treatment.
__(3) Outpatient mental health and substance abuse treatment, including case management, screening and assessment, crisis services, and collateral services.
__(b) Eligibility._The eligibility requirements referred to in subsection (a) are as follows:
__(1) Inpatient, residential, nonresidential, and outpatient treatment._An eligible individual is eligible to receive coverage for inpatient and residential mental health and substance abuse treatment, intensive nonresidential mental health and substance abuse treatment, or outpatient mental health and substance abuse treatment (except case management and collateral services) if the individual_
__(A) has, or has had during the 1-year period preceding the date of such treatment, a diagnosable mental or substance abuse disorder; and
__(B) is experiencing, or is at significant risk of experiencing, functional impairment in family, work, school, or community activities.
For purposes of this paragraph, an individual who has a diagnosable mental or substance abuse disorder, is receiving treatment for such disorder, but does not satisfy the functional impairment criterion in subparagraph (B) shall be treated as satisfying such criterion if the individual would satisfy such criterion without such treatment.
__(2) Case management._An eligible individual is eligible to receive coverage for case management if_
__(A) the health plan in which the individual is enrolled has elected to offer case management and determines that the individual should receive such services; and
__(B) the individual is eligible to receive coverage for, and is receiving, outpatient mental health and substance abuse treatment.
__(3) Screening and assessment and crisis services._All eligible individuals enrolled under a health plan are eligible to receive coverage for outpatient mental health and substance abuse treatment consisting of screening and assessment and crisis services.
__(4) Collateral services._An eligible individual is eligible to receive coverage for outpatient mental health and substance abuse treatment consisting of collateral services if the individual is a family member (as defined in section 1011(b)) of an individual who is receiving inpatient and residential mental health and substance abuse treatment, intensive nonresidential mental health and substance abuse treatment, or outpatient mental health and substance abuse treatment.
__(c) Inpatient and Residential Treatment._
__(1) Definition._For purposes of this subtitle, the term ``inpatient and residential mental health and substance abuse treatment'' means the items and services described in paragraphs (1) through (3) of section 1861(b) of the Social Security Act when provided with respect to a diagnosable mental or substance abuse disorder to_
__(A) an inpatient of a hospital, psychiatric hospital, residential treatment center, residential detoxification center, crisis residential program, or mental health residential treatment program; or
__(B) a resident of a therapeutic family or group treatment home or community residential treatment and recovery center for substance abuse.
The National Health Board shall specify those health professional services described in section 1112 that shall be treated as inpatient and residential mental health and substance abuse treatment when provided to such an inpatient or resident.
__(2) Limitations._Coverage for inpatient and residential mental health and substance abuse treatment is subject to the following limitations:
__(A) Least restrictive setting._Such treatment is covered only when_
__(i) provided to an individual in the least restrictive inpatient or residential setting that is effective and appropriate for the individual; and
__(ii) less restrictive intensive nonresidential or outpatient treatment would be ineffective or inappropriate.
__(B) Licensed facility._Such treatment is only covered when provided by a facility described in paragraph (1) that is legally authorized to provide the treatment in the State in which the facility is located.
__(C) Day limits._Subject to subparagraph (D), such treatment is covered for each period beginning on the date an episode of inpatient or residential treatment begins and ending on the date the episode ends, except that, prior to January 1, 2001, such treatment is not covered after such an episode exceeds 30 days unless the individual receiving treatment poses a threat to their own life or the life of another individual. Whether such a threat exists shall be determined by a health professional designated by the health plan in which the individual receiving treatment is enrolled. For purposes of this subtitle, an episode of inpatient and residential mental health and substance abuse treatment shall be considered to begin on the date an individual is admitted to a facility for such treatment and to end on the date the individual is discharged from the facility.
__(D) Annual limit._Prior to January 1, 2001, such treatment in all settings is subject to an aggregate annual limit of 60 days.
__(E) Inpatient hospital treatment for substance abuse._Substance abuse treatment, when provided to an inpatient of a hospital or psychiatric hospital, is covered under this section only for medical detoxification associated with withdrawal from alcohol or drugs.
__(d) Intensive Nonresidential Treatment._
__(1) Definition._For purposes of this subtitle, the term ``intensive nonresidential mental health and substance abuse treatment'' means diagnostic or therapeutic items or services provided with respect to a diagnosable mental or substance abuse disorder to an individual_
__(A) participating in a partial hospitalization program, a day treatment program, a psychiatric rehabilitation program, or an ambulatory detoxification program; or
__(B) receiving home-based mental health services or behavioral aide mental health services.
The National Health Board shall specify those health professional services described in section 1112 that shall be treated as intensive nonresidential mental health and substance abuse treatment when provided to such an individual.
__(2) Limitations._Coverage for intensive nonresidential mental health and substance abuse treatment is subject to the following limitations:
__(A) Discretion of plan._A health plan may cover intensive nonresidential mental health and substance abuse treatment at its discretion.
__(B) Treatment purposes._Such treatment is covered only when provided_
__(i) to avert the need for, or as an alternative to, treatment in residential or inpatient settings;
__(ii) to facilitate the earlier discharge of an individual receiving inpatient or residential care;
__(iii) to restore the functioning of an individual with a diagnosable mental health or substance abuse disorder; or
__(iv) to assist the individual to develop the skills and gain access to the support services the individual needs to achieve the maximum level of functioning of the individual within the community.
__(C) Annual limit._
__(i) In general._Prior to January 1, 2001, such treatment in all settings is subject to an aggregate annual limit of 120 days.
__(ii) Relationship to other annual limits._For each 2 days of intensive nonresidential mental health and substance abuse treatment provided to an individual, the number of treatment days available to the individual before the annual aggregate limit on inpatient and residential mental health and substance abuse treatment described in subsection (c)(2)(D) is exceeded shall be reduced by 1 day. The preceding sentence shall not apply after an individual has received 60 days of intensive nonresidential mental health and substance abuse treatment in a year.
__(iii) Additional days._A maximum of 60 additional days of intensive nonresidential mental health and substance abuse treatment may be provided to an individual if a health professional designated by the health plan in which the individual receiving treatment is enrolled determines that such additional treatment is medically necessary or appropriate.
__(D) Out-of-pocket maximum._Prior to January 1, 2001, expenses for intensive nonresidential mental health and substance abuse treatment that an individual incurs prior to satisfying a deductible applicable to such treatment, and copayments and coinsurance paid by or on behalf of the individual for such treatment, that substitute for inpatient and residential mental health and substance abuse treatment (up to 60 days) may be applied toward the annual out-of-pocket limit on cost sharing under any cost sharing schedule described in part 3 of this subtitle.
__(e) Outpatient Treatment._
__(1) Definition._For purposes of this subtitle, the term ``outpatient mental health and substance abuse treatment'' means the following services provided with respect to a diagnosable mental or substance abuse disorder in an outpatient setting:
__(A) Screening and assessment.
__(B) Diagnosis.
__(C) Medical management.
__(D) Substance abuse counseling and relapse prevention.
__(E) Crisis services.
__(F) Somatic treatment services.
__(G) Psychotherapy.
__(H) Case management.
__(I) Collateral services.
__(2) Limitations._Coverage for outpatient mental health and substance abuse treatment is subject to the following limitations:
__(A) Health professional services._Such treatment is covered only when it constitutes health professional services (as defined in section 1112(c)(2)).
__(B) Substance abuse counseling._Substance abuse counseling and relapse prevention is covered only when provided by a substance abuse treatment provider who_
__(i) is legally authorized to provide such services in the State in which the services are provided; and
__(ii) provides no items or services other than substance abuse counseling and relapse prevention, medical management, or laboratory and diagnostic tests for individuals with substance abuse disorders.
__(C) Annual limits._
__(i) Pychotherapy and collateral services._Prior to January 1, 2001, psychotherapy and collateral services are subject to annual limits of 30 visits for each type of service. Additional visits may be covered, at the discretion of the health plan in which the individual receiving treatment is enrolled, to prevent hospitalization or to facilitate earlier hospital release, for which the annual aggregate limit on inpatient and residential mental health and substance abuse treatment described in subsection (c)(2)(D) shall be reduced by 1 day for each 4 visits.
__(ii) Substance abuse._At the discretion of the health plan in which an individual receiving outpatient substance abuse treatment is enrolled, the annual aggregate limit on inpatient and residential mental health and substance abuse treatment described in subsection (c)(2)(D) may be reduced by 1 day for each 4 outpatient visits. Within 12 months after inpatient and residential treatment or intensive nonresidential treatment, 30 visits in group therapy shall be covered for substance abuse counseling and relapse prevention. For individuals who were not initially treated in an inpatient, residential, or intensive nonresidential setting, additional visits shall be covered for which the annual aggregate limit on inpatient and residential mental health and substance abuse treatment described in subsection (c)(2)(D) shall be reduced by 1 day for each 4 visits.
__(D) Out-of-pocket maximum._Prior to January 1, 2001, expenses for outpatient mental health and substance abuse treatment that an individual incurs prior to satisfying a deductible applicable to such treatment, and copayments and coinsurance paid by or on behalf of the individual for such treatment, may not be applied toward any annual out-of-pocket limit on cost sharing under any cost sharing schedule described in part 3 of this subtitle.
__(E) Detoxification._Outpatient detoxification shall be provided only in the context of a treatment program. If the first detoxification treatment is unsuccessful, subsequent treatments are covered if a health professional designated by the health plan in which the individual receiving treatment is enrolled determines that there is a substantial chance of success.
__(f) Other Definitions._For purposes of this subtitle:
__(1) Case management._The term ``case management'' means services that assist individuals in gaining access to needed medical, social, educational, and other services.
__(2) Diagnosable mental or substance abuse disorder._The term ``diagnosable mental or substance abuse disorder'' means a disorder that is listed in any authoritative text specifying diagnostic criteria for mental or substance abuse disorders that is identified by the National Health Board.
__(3) Psychiatric hospital._The term ``psychiatric hospital'' has the meaning given such term in section 1861(f) of the Social Security Act, except that such term shall include_
__(A) in the case of an item or service provided to an individual whose applicable health plan is specified pursuant to section 1004(b)(1), a facility of the uniformed services under title 10, United States Code, that is engaged in providing services to inpatients that are equivalent to the services provided by a psychiatric hospital;
__(B) in the case of an item or service provided to an individual whose applicable health plan is specified pursuant to section 1004(b)(2), a facility operated by the Department of Veterans Affairs that is engaged in providing services to inpatients that are equivalent to the services provided by a psychiatric hospital; and
__(C) in the case of an item or service provided to an individual whose applicable health plan is specified pursuant to section 1004(b)(3), a facility operated by the Indian Health Service that is engaged in providing services to inpatients that are equivalent to the services provided by a psychiatric hospital.
SEC. 1116. FAMILY PLANNING SERVICES AND SERVICES FOR PREGNANT WOMEN.
__The services described in this section are the following items and services:
__(1) Voluntary family planning services.
__(2) Contraceptive devices that_
__(A) may only be dispensed upon prescription; and
__(B) are subject to approval by the Secretary of Health and Human Services under the Federal Food, Drug, and Cosmetic Act.
__(3) Services for pregnant women.
SEC. 1117. HOSPICE CARE.
__The hospice care described in this section is the items and services described in paragraph (1) of section 1861(dd) of the Social Security Act, as defined in paragraphs (2), (3), and (4)(A) of such section (with the exception of paragraph (2)(A)(iii)), except that all references to the Secretary of Health and Human Services in such paragraphs shall be treated as references to the National Health Board.
SEC. 1118. HOME HEALTH CARE.
__(a) Coverage._The home health care described in this section is_
__(1) the items and services described in section 1861(m) of the Social Security Act; and
__(2) home infusion drug therapy services described in section 1861(ll) of the Social Security Act (as added by section 2006).
__(b) Limitations._Coverage for home health care is subject to the following limitations:
__(1) Inpatient treatment alternative._Such care is covered only as an alternative to inpatient treatment in a hospital, skilled nursing facility, or rehabilitation facility after an illness or injury.
__(2) Reevaluation._At the end of each 60-day period of home health care, the need for continued care shall be reevaluated by the person who is primarily responsible for providing the home health care. Additional periods of care are covered only if such person determines that the requirement in paragraph (1) is satisfied.
SEC. 1119. EXTENDED CARE SERVICES.
__(a) Coverage._The extended care services described in this section are the items and services described in section 1861(h) of the Social Security Act when provided to an inpatient of a skilled nursing facility or a rehabilitation facility.
__(b) Limitations._Coverage for extended care services is subject to the following limitations:
__(1) Hospital alternative._Such services are covered only as an alternative to inpatient treatment in a hospital after an illness or injury.
__(2) Annual limit._Such services are subject to an aggregate annual limit of 100 days.
__(c) Definitions._For purposes of this subtitle:
__(1) Rehabilitation facility._The term ``rehabilitation facility'' means an institution (or a distinct part of an institution) which is established and operated for the purpose of providing diagnostic, therapeutic, and rehabilitation services to individuals for rehabilitation from illness or injury.
__(2) Skilled nursing facility._The term ``skilled nursing facility'' means an institution (or a distinct part of an institution) which is primarily engaged in providing to residents_
__(A) skilled nursing care and related services for residents who require medical or nursing care; or
__(B) rehabilitation services to residents for rehabilitation from illness or injury.
SEC. 1120. AMBULANCE SERVICES.
__(a) Coverage._The ambulance services described in this section are the following items and services:
__(1) Ground transportation by ambulance.
__(2) Air transportation by an aircraft equipped for transporting an injured or sick individual.
__(3) Water transportation by a vessel equipped for transporting an injured or sick individual.
__(b) Limitations._Coverage for ambulance services is subject to the following limitations:
__(1) Medical indication._Ambulance services are covered only in cases in which the use of an ambulance is indicated by the medical condition of the individual concerned.
__(2) Air transport._Air transportation is covered only in cases in which there is no other method of transportation or where the use of another method of transportation is contra-indicated by the medical condition of the individual concerned.
__(3) Water transport._Water transportation is covered only in cases in which there is no other method of transportation or where the use of another method of transportation is contra-indicated by the medical condition of the individual concerned.
SEC. 1121. OUTPATIENT LABORATORY, RADIOLOGY, AND DIAGNOSTIC SERVICES.
__The items and services described in this section are laboratory, radiology, and diagnostic services provided upon prescription to individuals who are not inpatients of a hospital, hospice, skilled nursing facility, or rehabilitation facility.
SEC. 1122. OUTPATIENT PRESCRIPTION DRUGS AND BIOLOGICALS.
__(a) Coverage._The items described in this section are the following:
__(1) Covered outpatient drugs described in section 1861(t) of the Social Security Act (as amended by section 2001(b))_
__(A) except that, for purposes of this section, a medically accepted indication with respect to the use of a covered outpatient drug includes any use which has been approved by the Food and Drug Administration for the drug, and includes another use of the drug if_
__(i) the drug has been approved by the Food and Drug Administration; and
__(ii) such use is supported by one or more citations which are included (or approved for inclusion) in one or more of the following compendia: the American Hospital Formulary Service-Drug Information, the American Medical Association Drug Evaluations, the United States Pharmacopoeia-Drug Information, and other authoritative compendia as identified by the National Health Board, unless the Board has determined that the use is not medically appropriate or the use is identified as not indicated in one or more such compendia; or
__(iii) such use is medically accepted based on supportive clinical evidence in peer reviewed medical literature appearing in publications which have been identified for purposes of this clause by the Board; and
__(B) notwithstanding any exclusion from coverage that may be made with respect to such a drug under title XVIII of such Act pursuant to section 1862(a)(18) of such Act.
__(2) Blood clotting factors when provided on an outpatient basis.
__(b) Revision of Compendia List._The National Health Board may revise the list of compendia in subsection (a)(1)(A)(ii) designated as appropriate for identifying medically accepted indications for drugs.
__(c) Blood clotting factors._For purposes of this subtitle, the term ``blood clotting factors'' has the meaning given such term in section 1861(s)(2)(I) of the Social Security Act.
SEC. 1123. OUTPATIENT REHABILITATION SERVICES.
__(a) Coverage._The outpatient rehabilitation services described in this section are_
__(1) outpatient occupational therapy;
__(2) outpatient physical therapy; and
__(3) outpatient speech pathology services for the purpose of attaining or restoring speech.
__(b) Limitations._Coverage for outpatient rehabilitation services is subject to the following limitations:
__(1) Restoration of capacity or minimization of limitations._Such services include only items or services used to restore functional capacity or minimize limitations on physical and cognitive functions as a result of an illness or injury.
__(2) Reevaluation._At the end of each 60-day period of outpatient rehabilitation services, the need for continued services shall be reevaluated by the person who is primarily responsible for providing the services. Additional periods of services are covered only if such person determines that functioning is improving.
SEC. 1124. DURABLE MEDICAL EQUIPMENT AND PROSTHETIC AND ORTHOTIC DEVICES.
__(a) Coverage._The items and services described in this section are_
__(1) durable medical equipment, including accessories and supplies necessary for repair and maintenance of such equipment;
__(2) prosthetic devices (other than dental) which replace all or part of the function of an internal body organ (including colostomy bags and supplies directly related to colostomy care), including replacement of such devices;
__(3) accessories and supplies which are used directly with a prosthetic device to achieve the therapeutic benefits of the prosthesis or to assure the proper functioning of the device;
__(4) leg, arm, back, and neck braces;
__(5) artificial legs, arms, and eyes, including replacements if required because of a change in the patient's physical condition; and
__(6) fitting and training for use of the items described in paragraphs (1) through (5).
__(b) Limitation._An item or service described in this section is covered only if it improves functional ability or prevents further deterioration in function.
__(c) Durable Medical Equipment._For purposes of this subtitle, the term ``durable medical equipment'' has the meaning given such term in section 1861(n) of the Social Security Act.
SEC. 1125. VISION CARE.
__(a) Coverage._The vision care described in this section is diagnosis and treatment for defects in vision.
__(b) Limitation._Eyeglasses and contact lenses are covered only for individuals less than 18 years of age.
SEC. 1126. DENTAL CARE.
__(a) Coverage._The dental care described in this section is the following:
__(1) Emergency dental treatment, including simple extractions, for acute infections, bleeding, and injuries to natural teeth and oral structures for conditions requiring immediate attention to prevent risks to life or significant medical complications, as specified by the National Health Board. __(2) Prevention and diagnosis of dental disease, including oral dental examinations, radiographs, dental sealants, fluoride application, and dental prophylaxis.
__(3) Treatment of dental disease, including routine fillings, prosthetics for genetic defects, periodontal maintenance, and endodontic services.
__(4) Space maintenance procedures to prevent orthodontic complications.
__(5) Interceptive orthodontic treatment to prevent severe malocclusion.
__(b) Limitations._Coverage for dental care is subject to the following limitations:
__(1) Prevention and diagnosis._Prior to January 1, 2001, the items and services described in subsection (a)(2) are covered only for individuals less than 18 years of age. On or after such date, such items and services are covered for all eligible individuals enrolled under a health plan, except that dental sealants are not covered for individuals 18 years of age or older.
__(2) Treatment of dental disease._Prior to January 1, 2001, the items and services described in subsection (a)(3) are covered only for individuals less than 18 years of age. On or after such date, such items and services are covered for all eligible individuals enrolled under a health plan, except that endodontic services are not covered for individuals 18 years of age or older.
__(3) Space maintenance._The items and services described in subsection (a)(4) are covered only for individuals at least 3 years of age, but less than 13 years of age and_
__(A) are limited to posterior teeth;
__(B) involve maintenance of a space or spaces for permanent posterior teeth that would otherwise be prevented from normal eruption if the space were not maintained; and
__(C) do not include a space maintainer that is placed within 6 months of the expected eruption of the permanent posterior tooth concerned.
__(4) Interceptive orthodontic treatment._Prior to January 1, 2001, the items and services described in subsection (a)(5) are not covered. On or after such date, such items and services are covered only for individuals at least 6 years of age, but less than 12 years of age.
SEC. 1127. HEALTH EDUCATION CLASSES.
__(a) Coverage._Subject to subsection (b), the items and services described in this section are health education and training classes to encourage the reduction of behavioral risk factors and to promote healthy activities. Such education and training classes may include smoking cessation, nutrition counseling, stress management, support groups, and physical training classes.
__(b) Discretion of Plan._A health plan may offer education and training classes at its discretion.
__(c) Construction._This section shall not be construed to include or limit education or training that is provided in the course of the delivery of health professional services (as defined in section 1112(c)).
SEC. 1128. INVESTIGATIONAL TREATMENTS.
__(a) Coverage._Subject to subsection (b), the items and services described in this subsection are qualifying investigational treatments that are administered for a life-threatening disease, disorder, or other health condition (as defined by the National Health Board).
__(b) Discretion of Plan._A health plan may cover an investigational treatment described in subsection (a) at its discretion.
__(c) Routine Care During Investigational Treatments._The comprehensive benefit package includes an item or service described in any other section of this part, subject to the limitations and cost sharing requirements applicable to the item or service, when the item or service is provided to an individual in the course of an investigational treatment, if_
__(1) the treatment is a qualifying investigational treatment; and
__(2) the item or service would have been provided to the individual even if the individual were not receiving the investigational treatment.
__(d) Definitions._For purposes of this subtitle:
__(1) Qualifying investigational treatment._The term ``qualifying investigational treatment'' means a treatment_
__(A) the effectiveness of which has not been determined; and
__(B) that is under clinical investigation as part of an approved research trial.
__(2) Approved research trial._The term ``approved research trial'' means_
__(A) a research trial approved by the Secretary of Health and Human Services, the Director of the National Institutes of Health, the Commissioner of the Food and Drug Administration, the Secretary of Veterans Affairs, the Secretary of Defense, or a qualified nongovernmental research entity as defined in guidelines of the National Institutes of Health; or
__(B) a peer-reviewed and approved research program, as defined by the Secretary of Health and Human Services, conducted for the primary purpose of determining whether or not a treatment is safe, efficacious, or having any other characteristic of a treatment which must be demonstrated in order for the treatment to be medically necessary or appropriate.
PART 3_COST SHARING
SEC. 1131. COST SHARING.
__(a) In General._Each health plan shall offer to individuals enrolled under the plan one of the following cost sharing schedules, which schedule shall be offered to all such enrollees:
__(1) lower cost sharing (described in section 1132);
__(2) higher cost sharing (described in section 1133); or
__(3) combination cost sharing (described in section 1134).
__(b) Cost Sharing for Low-Income Families._For provisions relating to reducing cost sharing for certain low-income families, see section 1371.
__(c) Deductibles, Cost Sharing, and Out-of-Pocket Limits on Cost Sharing._
__(1) Application on an annual basis._The deductibles and out-of-pocket limits on cost sharing for a year under the schedules referred to in subsection (a) shall be applied based upon expenses incurred for items and services furnished in the year.
__(2) Individual and family general deductibles._
__(A) Individual._Subject to subparagraph (B), with respect to an individual enrolled under a health plan (regardless of the class of enrollment), any individual general deductible in the cost sharing schedule offered by the plan represents the amount of countable expenses (as defined in subparagraph (C)) that the individual may be required to incur in a year before the plan incurs liability for expenses for such items and services furnished to the individual.
__(B) Family._In the case of an individual enrolled under a health plan under a family class of enrollment (as defined in section 1011(c)(2)(A)), the individual general deductible under subparagraph (A) shall not apply to countable expenses incurred by any member of the individual's family in a year at such time as the family has incurred, in the aggregate, countable expenses in the amount of the family general deductible for the year.
__(C) Countable expense._In this paragraph, the term ``countable expense'' means, with respect to an individual for a year, an expense for an item or service covered by the comprehensive benefit package that is subject to the general deductible and for which, but for such deductible and other cost sharing under this subtitle, a health plan is liable for payment. The amount of countable expenses for an individual for a year under this paragraph shall not exceed the individual general deductible for the year.
__(3) Coinsurance and copayments._After a general or separate deductible that applies to an item or service covered by the comprehensive benefit package has been satisfied for a year, subject to paragraph (4), coinsurance and copayments are amounts that an individual may be required to pay with respect to the item or service.
__(4) Individual and family limits on cost sharing._
__(A) Individual._Subject to subparagraph (B), with respect to an individual enrolled under a health plan (regardless of the class of enrollment), the individual out-of-pocket limit on cost sharing in the cost sharing schedule offered by the plan represents the amount of expenses that the individual may be required to incur under the plan in a year because of a general deductible, separate deductibles, copayments, and coinsurance before the plan may no longer impose any cost sharing with respect to items or services covered by the comprehensive benefit package that are provided to the individual, except as provided in subsections (d)(2)(D) and (e)(2)(D) of section 1115.
__(B) Family._In the case of an individual enrolled under a health plan under a family class of enrollment (as defined in section 1011(c)(2)(A)), the family out-of-pocket limit on cost sharing in the cost sharing schedule offered by the plan represents the amount of expenses that members of the individual's family, in the aggregate, may be required to incur under the plan in a year because of a general deductible, separate deductibles, copayments, and coinsurance before the plan may no longer impose any cost sharing with respect to items or services covered by the comprehensive benefit package that are provided to any member of the individual's family, except as provided in subsections (d)(2)(D) and (e)(2)(D) of section 1115.
SEC. 1132. LOWER COST SHARING.
__(a) In General._The lower cost sharing schedule referred to in section 1131 that is offered by a health plan_
__(1) may not include a deductible;
__(2) shall have_
__(A) an annual individual out-of-pocket limit on cost sharing of $1500; and
__(B) an annual family out-of-pocket limit on cost sharing of $3000;
__(3) except as provided in paragraph (4)_
__(A) shall prohibit payment of any coinsurance; and
__(B) subject to section 1152, shall require payment of the copayment for an item or service (if any) that is specified for the item or service in the table under section 1135; and
__(4) shall require payment of coinsurance for an out-of-network item or service (as defined in section 1402(f)) in an amount that is a percentage (determined under subsection (b)) of the applicable payment rate for the item or service established under section 1322(c), but only if the item or service is subject to coinsurance under the higher cost sharing schedule described in section 1133.
__(b) Out-of-Network Coinsurance Percentage._
__(1) In general._The National Health Board shall determine a percentage referred to in subsection (a)(4). The percentage_
__(A) may not be less than 20 percent; and
__(B) shall be the same with respect to all out-of-network items and services that are subject to coinsurance, except as provided in paragraph (2).
__(2) Exception._The National Health Board may provide for a percentage that is greater than a percentage determined under paragraph (1) in the case of an out-of-network item or service for which the coinsurance is greater than 20 percent of the applicable payment rate under the higher cost sharing schedule described in section 1133.
SEC. 1133. HIGHER COST SHARING.
__The higher cost sharing schedule referred to in section 1131 that is offered by a health plan_
__(1) shall have an annual individual general deductible of $200 and an annual family general deductible of $400 that apply with respect to expenses incurred for all items and services in the comprehensive benefit package except_
__(A) an item or service with respect to which a separate individual deductible applies under paragraph (2), (3), or (4); or
__(B) an item or service described in paragraph (5), (6), or (7) with respect to which a deductible does not apply;
__(2) shall require an individual to incur expenses during each episode of inpatient and residential mental health and substance abuse treatment (described in section 1115) equal to the cost of one day of such treatment before the plan provides benefits for such treatment to the individual;
__(3) shall require an individual to incur expenses in a year for outpatient prescription drugs and biologicals (described in section 1122) equal to $250 before the plan provides benefits for such items to the individual;
__(4) shall require an individual to incur expenses in a year for dental care described in section 1126, except the items and services for prevention and diagnosis of dental disease described in section 1126(a)(2), equal to $50 before the plan provides benefits for such care to the individual;
__(5) may not require any deductible for clinical preventive services (described in section 1114);
__(6) may not require any deductible for clinician visits and associated services related to prenatal care or 1 post-partum visit under section 1116;
__(7) may not require any deductible for the items and services for prevention and diagnosis of dental disease described in section 1126(a)(2);
__(8) shall have_
__(A) an annual individual out-of-pocket limit on cost sharing of $1500; and
__(B) an annual family out-of-pocket limit on cost sharing of $3000;
__(9) shall prohibit payment of any copayment; and
__(10) subject to section 1152, shall require payment of the coinsurance for an item or service (if any) that is specified for the item or service in the table under section 1135.
SEC. 1134. COMBINATION COST SHARING.
__(a) In General._The combination cost sharing schedule referred to in section 1131 that is offered by a health plan_
__(1) shall have_
__(A) an annual individual out-of-pocket limit on cost sharing of $1500; and
__(B) an annual family out-of-pocket limit on cost sharing of $3000; and
__(2) otherwise shall require different cost sharing for in-network items and services than for out-of-network items and services.
__(b) In-Network Items and Services._With respect to an in-network item or service (as defined in section 1402(f)(1)), the combination cost sharing schedule that is offered by a health plan_
__(1) may not apply a deductible;
__(2) shall prohibit payment of any coinsurance; and
__(3) shall require payment of a copayment in accordance with the lower cost sharing schedule described in section 1132.
__(c) Out-of-Network Items and Services._With respect to an out-of-network item or service (as defined in section 1402(f)(2)), the combination cost sharing schedule that is offered by a health plan_
__(1) shall require an individual and a family to incur expenses before the plan provides benefits for the item or service in accordance with the deductibles under the higher cost sharing schedule described in section 1133;
__(2) shall prohibit payment of any copayment; and
__(3) shall require payment of coinsurance in accordance with such schedule.
SEC. 1135. TABLE OF COPAYMENTS AND COINSURANCE.
__(a) In General._The following table specifies, for different items and services, the copayments and coinsurance referred to in sections 1132 and 1133:

Copayments and Coinsurance for Items and Services

Benefit
Section
Lower Cost Sharing Schedule
Higher Cost Sharing Schedule

Inpatient hospital services No copayment 20 percent of applicable payment rate

Outpatient hospital services $10 per visit 20 percent of applicable payment rate

Hospital emergency room services

$25 per visit (unless patient has an emergency medical condition as defined in section 1867(e)(1) of the Social Security Act) 20 percent of applicable payment rate

Services of health professionals  $10 per visit 20 percent of applicable payment rate

Emergency services other than hospital emergency room services

$25 per visit (unless patient has an emergency medical condition as defined in section 1867(e)(1) of the Social Security Act) 20 percent of applicable payment rate

Ambulatory medical and surgical services  $10 per visit 20 percent of applicable payment rate

Clinical preventive services  No copayment No coinsurance

Inpatient and residential mental health and substance abuse treatment No copayment 20 percent of applicable payment rate

Intensive nonresidential mental health and substance abuse treatment No copayment 20 percent of applicable payment rate

Outpatient mental health and substance abuse treatment (except psychotherapy, collateral services, and case management) $10 per visit 20 percent of applicable payment rate

Outpatient psychotherapy and collateral services $25 per visit until January 1, 2001, and $10 per visit thereafter 50 percent of applicable payment rate until January 1, 2001, and 20 percent thereafter

Case management No copayment No coinsurance

Family planning and services for pregnant women (except clinician visits and associated services related to prenatal care and 1 post-partum visit) $10 per visit 20 percent of applicable payment rate

Clinician visits and associated services related to prenatal care and 1 post-partum visit No copayment No coinsurance

Hospice care No copayment 20 percent of applicable payment rate

Home health care No copayment 20 percent of applicable payment rate

Extended care services No copayment 20 percent of applicable payment rate

Ambulance services No copayment 20 percent of applicable payment rate

Outpatient laboratory, radiology, and diagnostic services No copayment 20 percent of applicable payment rate

Outpatient prescription drugs and biologicals $5 per prescription 20 percent of applicable payment rate

Outpatient rehabilitation services $10 per visit 20 percent of applicable payment rate

Durable medical equipment and prosthetic and orthotic devices No copayment 20 percent of applicable payment rate

Vision care $10 per visit (No additional charge for 1 set of necessary eyeglasses for an individual less than 18 years of age) 20 percent of applicable payment rate

Dental care (except space maintenance procedures and interceptive orthodontic treatment) $10 per visit 20 percent of applicable payment rate

Space maintenance procedures and interceptive orthodontic treatment $20 per visit 40 percent of applicable payment rate

Health education classes All cost sharing rules determined by plans cost sharing rules determined by plans

Investigational treatment for life-threatening condition All cost sharing rules determined by plans cost sharing rules determined by plans

__(b) Applicable Payment Rate._For purposes of this section, the term ``applicable payment rate'', when used with respect to an item or service, means the applicable payment rate for the item or service established under section 1322(c).
SEC. 1136. INDEXING DOLLAR AMOUNTS RELATING TO COST SHARING.
__(a) In General._Any deductible, copayment, out-of-pocket limit on cost sharing, or other amount expressed in dollars in this subtitle for items or services provided in a year after 1994 shall be such amount increased by the percentage specified in subsection (b) for the year.
__(b) Percentage._The percentage specified in this subsection for a year is equal to the product of the factors described in subsection (d) for the year and for each previous year after 1994.
__(c) Rounding._Any increase (or decrease) under subsection (a) shall be rounded, in the case of an amount specified in this subtitle of_
__(1) $200 or less, to the nearest multiple of $1,
__(2) more than $200, but less $500, to the nearest multiple of $5, or
__(3) $500 or more, to the nearest multiple of $10.
__(d) Factor._
__(1) In general._The factor described in this subsection for a year is 1 plus the general health care inflation factor (as specified in section 6001(a)(3) and determined under paragraph (2)) for the year.
__(2) Determination._In computing such factor for a year, the percentage increase in the CPI for a year (referred to in section 6001(b)) shall be determined based upon the percentage increase in the average of the CPI for the 12-month period ending with August 31 of the previous year over such average for the preceding 12-month period.
PART 4_EXCLUSIONS
SEC. 1141. EXCLUSIONS.
__(a) Medical Necessity._The comprehensive benefit package does not include_
__(1) an item or service (other than services referred to in paragraph (2)) that is not medically necessary or appropriate; or
__(2) an item or service that the National Health Board may determine is not medically necessary or appropriate in a regulation promulgated under section 1154.
__(b) Additional Exclusions._The comprehensive benefit package does not include the following items and services:
__(1) Custodial care, except in the case of hospice care under section 1117.
__(2) Surgery and other procedures performed solely for cosmetic purposes and hospital or other services incident thereto, unless_
__(A) required to correct a congenital anomaly; or
__(B) required to restore or correct a part of the body that has been altered as a result of_
__(i) accidental injury;
__(ii) disease; or
__(iii) surgery that is otherwise covered under this subtitle.
__(3) Hearing aids.
__(4) Eyeglasses and contact lenses for individuals at least 18 years of age.
__(5) In vitro fertilization services.
__(6) Sex change surgery and related services.
__(7) Private duty nursing.
__(8) Personal comfort items, except in the case of hospice care under section 1117.
__(9) Any dental procedures involving orthodontic care, inlays, gold or platinum fillings, bridges, crowns, pin/post retention, dental implants, surgical periodontal procedures, or the preparation of the mouth for the fitting or continued use of dentures, except as specifically described in section 1126.
PART 5_ROLE OF THE NATIONAL HEALTH BOARD
SEC. 1151. DEFINITION OF BENEFITS.
__(a) In General._The National Health Board may promulgate such regulations or establish such guidelines as may be necessary to assure uniformity in the application of the comprehensive benefit package across all health plans.
__(b) Flexibility in Delivery._The regulations or guidelines under subsection (a) shall permit a health plan to deliver covered items and services to individuals enrolled under the plan using the providers and methods that the plan determines to be appropriate.
SEC. 1152. ACCELERATION OF EXPANDED BENEFITS.
__(a) In General._Subject to subsection (b), at any time prior to January 1, 2001, the National Health Board, in its discretion, may by regulation expand the comprehensive benefit package by_
__(1) adding any item or service that is added to the package as of January 1, 2001; and
__(2) requiring that a cost sharing schedule described in part 3 of this subtitle reflect (wholly or in part) any of the cost sharing requirements that apply to the schedule as of January 1, 2001.
No such expansion shall be effective except as of January 1 of a year.
__(b) Condition._The Board may not expand the benefit package under subsection (a) which is to become effective with respect to a year, by adding any item or service or altering any cost sharing schedule, unless the Board estimates that the additional increase in per capita health care expenditures resulting from the addition or alteration, for each regional alliance for the year, will not cause any regional alliance to exceed its per capita target (as determined under section 6003(a)).
SEC. 1153. AUTHORITY WITH RESPECT TO CLINICAL PREVENTIVE SERVICES.
__(a) In General._With respect to clinical preventive services described in section 1114, the National Health Board_
__(1) shall specify and define specific items and services as clinical preventive services for high risk populations and shall establish and update a periodicity schedule for such items and services;
__(2) shall update the periodicity schedules for the age-appropriate immunizations, tests, and clinician visits specified in subsections (b) through (h) of such section;
__(3) shall establish rules with respect to coverage for an immunization, test, or clinician visit that is not provided to an individual during the age range for such immunization, test, or clinician visit that is specified in one of subsections (b) through (h) of such section; and
__(4) may otherwise modify the items and services described in such section, taking into account age and other risk factors, but may not modify the cost sharing for any such item or service.
__(b) Consultation._In performing the functions described in subsection (a), the National Health Board shall consult with experts in clinical preventive services.
SEC. 1154. ESTABLISHMENT OF STANDARDS REGARDING MEDICAL NECESSITY.
__The National Health Board may promulgate such regulations as may be necessary to carry out section 1141(a)(2) (relating to the exclusion of certain services that are not medically necessary or appropriate).
PART 6_ADDITIONAL PROVISIONS RELATING TO HEALTH CARE PROVIDERS
SEC. 1161. OVERRIDE OF RESTRICTIVE STATE PRACTICE LAWS.
__No State may, through licensure or otherwise, restrict the practice of any class of health professionals beyond what is justified by the skills and training of such professionals.
SEC. 1162. PROVISION OF ITEMS OR SERVICES CONTRARY TO RELIGIOUS BELIEF OR MORAL CONVICTION.
__A health professional or a health facility may not be required to provide an item or service in the comprehensive benefit package if the professional or facility objects to doing so on the basis of a religious belief or moral conviction.

Title I, Subtitle C
Subtitle C_State Responsibilities
SEC. 1200. PARTICIPATING STATE.
__(a) In General._For purposes of the approval of a State health care system by the Board under section 1511, a State is a ``participating State'' if the State meets the applicable requirements of this subtitle.



__(b) Submission of System Document._
__(1) In general._In order to be approved as a participating State under section 1511, a State shall submit to the National Health Board a document (in a form and manner specified by the Board) that describes the State health care system that the State is establishing (or has established).
__(2) Deadline._If a State is not a participating State with a State health care system in operation by January 1, 1998, the provisions of subpart B of part 2 of subtitle F (relating to Federal operation of a State health care system) shall take effect.

__(3) Submission of information subsequent to approval._A State approved as a participating State under section 1511 shall submit to the Board an annual update to the State health care system not later than February 15 of each year following the first year for which the State is a participating State that contains_
__(A) such information as the Board may require to determine that the system shall meet the applicable requirements of subtitle C for the succeeding year; and
__(B) such information as the Board may require to determine that the State operated the system during the previous year in accordance with the Board's approval of the system for such previous year.

PART 1_GENERAL STATE RESPONSIBILITIES
SEC. 1201. GENERAL STATE RESPONSIBILITIES.
__The responsibilities for a participating State are as follows:
__(1) Regional alliances._Establishing one or more regional alliances (in accordance with section 1202).
__(2) Health plans._Certifying health plans (in accordance with section 1203).

__(3) Financial solvency of plans._Assuring the financial solvency of health plans (in accordance with section 1204).

__(4) Administration. esignating an agency or official charged with coordinating the State responsibilities under Federal law.
__(5) Workers compensation and automobile insurance._Conforming State laws to meet the requirements of title X (relating to medical benefits under workers compensation and automobile insurance).
__(6) Other responsibilities._Carrying out other responsibilities of participating States specified under this Act.
SEC. 1202. STATE RESPONSIBILITIES WITH RESPECT TO ALLIANCES.
__(a) Establishment of Alliances._
__(1) In general._A participating State shall_
__(A) establish and maintain one or more regional alliances in accordance with this section and subtitle D, and ensure that such alliances meet the requirements of this Act; and
__(B) designate alliance areas in accordance with subsection (b).
__(2) Deadline._A State may not be a participating State for a year unless the State has established such alliances by March 1 of the previous year.
__(b) Alliance Areas._
__(1) In general._In accordance with this subsection, each State shall designate a geographic area assigned to each regional alliance. Each such area is referred to in this Act as an ``alliance area''.
__(2) Population required._
__(A) In general._Each alliance area shall encompass a population large enough to ensure that the alliance has adequate market share to negotiate effectively with health plans providing the comprehensive benefit package to eligible individuals who reside in the area.
__(B) Treatment of consolidated metropolitan statistical areas._An alliance area that includes a Consolidated Metropolitan Statistical Area within a State is presumed to meet the requirements of subparagraph (A).
__(3) Single alliance in each area._No geographic area may be assigned to more than one regional alliance.
__(4) Boundaries._In establishing boundaries for alliance areas, the State may not discriminate on the basis of or otherwise take into account race, ethnicity, language, religion, national origin, socio-economic status, disability, or perceived health status.
__(5) Treatment of metropolitan areas._The entire portion of a metropolitan statistical area located in a State shall be included in the same alliance area.



__(6) No portions of State permitted to be outside alliance area._Each portion of the State shall be assigned to a regional alliance under this subsection.
__(c) State Coordination of Regional Alliances._One or more States may allow or require two or more regional alliances to coordinate their operations, whether such alliances are in the same or different States. Such coordination may include adoption of joint operating rules, contracting with health plans, enforcement activities, and establishment of fee schedules for health providers.
__(d) Assistance in Collection of Amounts Owed to Alliances._Each State shall assure that the amounts owed to regional alliances in the State are collected and paid to such alliances.
__(e) Assistance in Eligibility Verifications._
__(1) In general._Each State shall assure that the determinations of eligibility for cost sharing assistance (and premium discounts and cost sharing reductions for families) are made by regional alliances in the State on the basis of the best information available to the alliances and the State.
__(2) Provision of information._Each State shall use the information available to the State under section 6103(l)(7)(D)(x) of the Internal Revenue Code of 1986 to assist regional alliances in verifying such eligibility status.
__(f) Special Requirements for Alliances With Single-Payer System._If the State operates an alliance-specific single-payer system (as described in part 2), the State shall assure that the regional alliance in which the system is operated meets the requirements for such an alliance described in section 1224(b).
__(g) Payment of Shortfalls for Certain Administrative Errors._Each participating State is financially responsible, under section 9201(c)(2), for administrative errors described in section 9201(e)(2).
SEC. 1203. STATE RESPONSIBILITIES RELATING TO HEALTH PLANS.
__(a) Criteria for Certification._
__(1) In general._For purposes of this section, a participating State shall establish and publish the criteria that are used in the certification of health plans under this section.
__(2) Requirements._Such criteria shall be established with respect to_
__(A) the quality of the plan,
__(B) the financial stability of the plan,
__(C) the plan's capacity to deliver the comprehensive benefit package in the designated service area,
__(D) other applicable requirements for health plans under parts 1, 3, and 4 of subtitle E, and
__(E) other requirements imposed by the State consistent with this part.
__(b) Certification of Health Plans._A participating State shall certify each plan as a regional alliance health plan that it determines meet the criteria for certification established and published under subsection (a).
__(c) Monitoring._A participating State shall monitor the performance of each State-certified regional alliance health plan to ensure that it continues to meet the criteria for certification.


__(d) Limitations on Authority._A participating State may not_
__(1) discriminate against a plan based on the domicile of the entity offering of the plan; and
__(2) regulate premium rates charged by health plans, except as may be required under title VI (relating to the enforcement of cost containment rules for plans in the State) or as may be necessary to ensure that plans meet financial solvency requirements under section 1408.
__(e) Assuring Adequate Access to a Choice of Health Plans._
__(1) General access._
__(A) In general._Each participating State shall ensure that_
__(i) each regional alliance eligible family has adequate access to enroll in a choice of regional alliance health plans providing services in the area in which the individual resides, including (to the maximum extent practicable) adequate access to a plan whose premium is at or below the weighted average premium for plans in the regional alliance, and
__(ii) each such family that is eligible for a premium discount under section 6104(b) is provided a discount in accordance with such section (including an increase in such discount described in section 6104(b)(2)).

__(B) Authority._In order to carry out its responsibility under subparagraph (A), a participating State may require, as a condition of entering into a contract with a regional alliance under section 1321, that one or more certified regional alliance health plans cover all (or selected portions) of the alliance area.
__(2) Access to plans using centers of excellence._Each participating State may require, as a condition of entering into a contract with a regional alliance under section 1321, that one or more certified health plans provide access (through reimbursement, contracts, or otherwise) of enrolled individuals to services of centers of excellence (as designated by the State in accordance with rules promulgated by the Secretary).
__(3) Use of incentives to enroll and serve disadvantaged groups._A State may provide_
__(A) for an adjustment to the risk-adjustment methodology under section 1542(c) and other financial incentives to regional alliance health plans to ensure that such plans enroll individuals who are members of disadvantaged groups, and
__(B) for appropriate extra services, such as outreach to encourage enrollment and transportation and interpreting services to ensure access to care, for certain population groups that face barriers to access because of geographic location, income levels, or racial or cultural differences.

__(f) Coordination of Workers' Compensation Services and Automobile Insurance._Each participating State shall comply with the responsibilities regarding workers' compensation and automobile insurance specified in title X.
__(g) Implementation of Mandatory Reinsurance System._If the risk adjustment and reinsurance methodology developed under section 1541 includes a mandatory reinsurance system, each participating State shall establish a reinsurance program consistent with such methodology and any additional standards established by the Board.
__(h) Requirements for Plans Offering Supplemental Insurance._Notwithstanding any other provision of this Act a State may not certify a regional alliance health plan under this section if_
__(1) the plan (or any entity with which the plan is affiliated under such rules as the Board may establish) offers a supplemental health benefit policy (as defined in section 1421(a)(1)) that fails to meet the applicable requirements for such a policy under part 2 of subtitle E (without regard to the State in which the policy is offered); or
__(2) the plan offers a cost sharing policy (as defined in section 1421(a)(2)) that fails to meet the applicable requirements for such a policy under part 2 of subtitle E.


SEC. 1204. FINANCIAL SOLVENCY; FISCAL OVERSIGHT; GUARANTY FUND.
__(a) Capital Standards._A participating State shall establish capital standards for health plans that meet minimum Federal requirements established by the National Health Board under section 1505(i).
__(b) Reporting and Auditing Requirements._Each participating State shall define financial reporting and auditing requirements and requirements for fund reserves adequate to monitor the financial status of plans.
__(c) Guaranty Fund._
__(1) Establishment._Each participating State shall ensure that there is a guaranty fund that meets the requirements established by the Board under section 1505(j)(2), in order to provide financial protection to health care providers and others in the case of a failure of a regional alliance health plan.
__(2) Assessments to provide funds._In the case of a failure of one or more regional alliance health plans, the State may require each regional alliance health plan within the State to pay an assessment to the State in an amount not to exceed 2 percent of the premiums of such plans paid by or on behalf of regional alliance eligible individuals during a year for so long as necessary to generate sufficient revenue to cover any outstanding claims against the failed plan.
__(d) Procedures in Event of Plan Failure._
__(1) In general._A participating State shall assure that, in the event of the failure of a regional alliance health plan in the State, eligible individuals enrolled in the plan will be assured continuity of coverage for the comprehensive benefit package.
__(2) Designation of state agency._A participating State shall designate an agency of State government that supervises or assumes control of the operation of a regional alliance health plan in the case of the failure of the plan.
__(3) Protections for health care providers and enrollees._Each participating State shall assure that in the case of a plan failure_
__(A) the guaranty fund shall pay health care providers for items and services covered under the comprehensive benefit package for enrollees of the plan for which the plan is otherwise obligated to make payment;
__(B) after making all payments required to be made to providers under subparagraph (A), the guaranty fund shall make payments for the operational, administrative, and other costs and debts of the plan (in accordance with requirements imposed by the State based on rules promulgated by the Board);
__(C) such health care providers have no legal right to seek payment from eligible individuals enrolled in the plan for any such covered items or services (other than the enrollees' obligations under cost sharing arrangements); and
__(D) health care providers are required to continue caring for such eligible individuals until such individuals are enrolled in a new health plan.
__(4) Plan failure._For purposes of this section, the failure of a health plan means the current or imminent inability to pay claims.
SEC. 1205. RESTRICTIONS ON FUNDING OF ADDITIONAL BENEFITS. 
__If a participating State provides benefits (either directly or through regional alliance health plans or otherwise) in addition to those covered under the comprehensive benefit package, the State may not provide for payment for such benefits through funds provided under this Act.

PART 2_REQUIREMENTS FOR STATE SINGLE-PAYER SYSTEMS

SEC. 1221. SINGLE-PAYER SYSTEM DESCRIBED.
__The Board shall approve the application of a State to operate a single-payer system if the Board finds that the system_
__(1) meets the requirements of section 1222;
__(2) meets the requirements for a Statewide single-payer system under section 1223, in the case of a system offered throughout a State; and
__(3) meets the requirements for an alliance-specific single-payer system under section 1224, in the case of a system offered in a single alliance of a State.

SEC. 1222. GENERAL REQUIREMENTS FOR SINGLE-PAYER SYSTEMS.
__Each single-payer system shall meet the following requirements:
__(1) Establishment by state._The system is established under State law, and State law provides for mechanisms to enforce the requirements of the plan.
__(2) Operation by state._The system is operated by the State or a designated agency of the State.
__(3) Enrollment of eligible individuals._
__(A) Mandatory enrollment of all regional alliance individuals._The system provides for the enrollment of all eligible individuals residing in the State (or, in the case of an alliance-specific single-payer system, in the alliance area) for whom the applicable health plan would otherwise be a regional alliance health plan.
__(B) Optional enrollment of medicare-eligible individuals._At the option of the State, the system may provide for the enrollment of medicare-individuals residing in the State (or, in the case of an alliance-specific single-payer system, in the alliance area) if the Secretary of Health and Human Services has approved an application submitted by the State under section 1893 of the Social Security Act (as added by section 4001(a)) for the integration of medicare beneficiaries into plans of the State. Nothing in this subparagraph shall be construed as requiring that a State have a single-payer system in order to provide for such integration.
__(C) Optional enrollment of corporate alliance individuals in statewide plans._At the option of the State, a Statewide single-payer system may provide for the enrollment of individuals residing in the State who are otherwise eligible to enroll in a corporate alliance health plan under section 1311.
__(D) Options included in State system document._A State may not exercise any of the options described in subparagraphs (A) or (B) for a year unless the State included a description of the option in the submission of its system document to the Board for the year under section 1200(b).
__(E) Exclusion of certain individuals._A single-payer system may not require the enrollment of electing veterans, active duty military personnel, and electing Indians (as defined in 1012(d)).
__(4) Direct payment to providers._
__(A) In general._With respect to providers who furnish items and services included in the comprehensive benefit package to individuals enrolled in the system, the State shall make payments directly to such providers and assume (subject to subparagraph (B)) all financial risk associated with making such payments.
__(B) Capitated payments permitted._Nothing in subparagraph (A) shall be construed to prohibit providers furnishing items and services under the system from receiving payments from the plan on a capitated, at-risk basis based on prospectively determined rates.
__(5) Provision of comprehensive benefit package._
__(A) In general._The system shall provide for coverage of the comprehensive benefit package, including the cost sharing provided under the package (subject to subparagraph (B)), to all individuals enrolled in the system.
__(B) Imposition of reduced cost sharing._The system may decrease the cost sharing otherwise provided in the comprehensive benefit package with respect to any class of individuals enrolled in the system or any class of services included in the package, so long as the system does not increase the cost sharing otherwise imposed with respect to any other class of individuals or services.
__(6) Cost containment._The system shall provide for mechanisms to ensure, in a manner satisfactory to the Board, that_
__(A) per capita expenditures for items and services in the comprehensive benefit package under the system for a year (beginning with the first year) do not exceed an amount equivalent to the regional alliance per capita premium target that is determined under section 6003 (based on the State being a single regional alliance) for the year;
__(B) the per capita expenditures described in subparagraph (A) are computed and effectively monitored; and
__(C) automatic, mandatory, nondiscretionary reductions in payments to health care providers will be imposed to the extent required to assure that such per capita expenditures do not exceed in the applicable target referred to in subparagraph (A).



__(7) Requirements generally applicable to health plans._The system shall meet the requirements applicable to a health plan under section 1400(a), except that_
__(A) the system does not have the authority provided to health plans under section 1402(a)(2) (relating to permissible limitations on the enrollment of eligible individuals on the basis of limits on the plan's capacity);
__(B) the system is not required to meet the requirements of section 1404(a) (relating to restrictions on the marketing of plan materials); and
__(C) the system is not required to meet the requirements of section 1408 (relating to plan solvency).

SEC. 1223. SPECIAL RULES FOR STATES OPERATING STATEWIDE SINGLE-PAYER SYSTEM.
__(a) In General._In the case of a State operating a Statewide single-payer system_
__(1) the State shall operate the system throughout the State through a single alliance;
__(2) except as provided in subsection (b), the State shall meet the requirements for participating States under part 1; and
__(3) the State shall assume the functions described in subsection (c) that are otherwise required to be performed by regional alliances in participating States that do not operate a Statewide single-payer system.
__(b) Exceptions to Certain Requirements for Participating States._In the case of a State operating a Statewide single-payer system, the State is not required to meet the following requirements otherwise applicable to participating States under part 1:
__(1) Establishment of alliances._The requirements of section 1202 (relating to the establishment of alliances).
__(2) Health plans._The requirements of section 1203 (relating to health plans), other than the requirement of subsection (f) of such section (relating to coordination of workers' compensation services and automobile liability insurance).
__(3) Financial solvency._The requirements of section 1204 (relating to the financial solvency of health plans in the State).
__(c) Assumption by State of Certain Requirements Applicable to Regional Alliances._A State operating a Statewide single-payer system shall be subject to the following requirements otherwise applicable to regional