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BIPARTISAN CONSENSUS MANAGED CARE IMPROVEMENT ACT OF 1999
(House of Representatives - October 07, 1999)

Text of this article available as: TXT PDF [Pages H9523-H9636] BIPARTISAN CONSENSUS MANAGED CARE IMPROVEMENT ACT OF 1999 The SPEAKER pro tempore (Mrs. Biggert). Pursuant to House Resolution 323 and rule XXVIII, the Chair declares the House in the Committee of the Whole House on the State of the Union for the further consideration of the bill, H.R. 2723. {time} 1107 In the Committee of the Whole Accordingly, the House resolved itself into the Committee of the Whole House on the State of the Union for the further consideration of the bill (H.R. 2723) to amend Title I of the Employee Retirement Income Security Act of 1974, title XXVII of the Public Health Service Act, and the Internal Revenue Code of 1986 to protect consumers in managed care plans and other health coverage, with Mr. Hastings of Washington in the chair. The Clerk read the title of the bill. The CHAIRMAN. When the Committee of the Whole rose on Wednesday, October 6, 1999, all time for general debate had expired. Pursuant to the rule, the amendments printed in part A of House Report 106-366 are adopted and the bill, as amended, is considered read for amendment under the 5-minute rule. The text of H.R. 2723, as amended, is as follows: H.R. 2723 Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE; TABLE OF CONTENTS. (a) Short Title.--This Act may be cited as the ``Bipartisan Consensus Managed Care Improvement Act of 1999''. (b) Table of Contents.--The table of contents of this Act is as follows: Sec. 1. Short title; table of contents. TITLE I--IMPROVING MANAGED CARE Subtitle A--Grievances and Appeals Sec. 101. Utilization review activities. Sec. 102. Internal appeals procedures. Sec. 103. External appeals procedures. Sec. 104. Establishment of a grievance process. Subtitle B--Access to Care Sec. 111. Consumer choice option. Sec. 112. Choice of health care professional. Sec. 113. Access to emergency care. Sec. 114. Access to specialty care. Sec. 115. Access to obstetrical and gynecological care. Sec. 116. Access to pediatric care. Sec. 117. Continuity of care. Sec. 118. Access to needed prescription drugs. Sec. 119. Coverage for individuals participating in approved clinical trials. Subtitle C--Access to Information Sec. 121. Patient access to information. Subtitle D--Protecting the Doctor-Patient Relationship Sec. 131. Prohibition of interference with certain medical communications. Sec. 132. Prohibition of discrimination against providers based on licensure. Sec. 133. Prohibition against improper incentive arrangements. Sec. 134. Payment of claims. Sec. 135. Protection for patient advocacy. Subtitle E--Definitions Sec. 151. Definitions. Sec. 152. Preemption; State flexibility; construction. Sec. 153. Exclusions. Sec. 154. Coverage of limited scope plans. Sec. 155. Regulations. TITLE II--APPLICATION OF QUALITY CARE STANDARDS TO GROUP HEALTH PLANS AND HEALTH INSURANCE COVERAGE UNDER THE PUBLIC HEALTH SERVICE ACT Sec. 201. Application to group health plans and group health insurance coverage. Sec. 202. Application to individual health insurance coverage. TITLE III--AMENDMENTS TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974 Sec. 301. Application of patient protection standards to group health plans and group health insurance coverage under the Employee Retirement Income Security Act of 1974. Sec. 302. ERISA preemption not to apply to certain actions involving health insurance policyholders. TITLE IV--APPLICATION TO GROUP HEALTH PLANS UNDER THE INTERNAL REVENUE CODE OF 1986 Sec. 401. Amendments to the Internal Revenue Code of 1986. TITLE V--EFFECTIVE DATES; COORDINATION IN IMPLEMENTATION Sec. 501. Effective dates. Sec. 502. Coordination in implementation. TITLE VI--HEALTH CARE PAPERWORK SIMPLIFICATION Sec. 601. Health care paperwork simplification. TITLE I--IMPROVING MANAGED CARE Subtitle A--Grievance and Appeals SEC. 101. UTILIZATION REVIEW ACTIVITIES. (a) Compliance With Requirements.-- (1) In general.--A group health plan, and a health insurance issuer that provides health insurance coverage, shall conduct utilization review activities in connection with the provision of benefits under such plan or coverage only in accordance with a utilization review program that meets the requirements of this section. (2) Use of outside agents.--Nothing in this section shall be construed as preventing a group health plan or health insurance issuer from arranging through a contract or otherwise for persons or entities to conduct utilization review activities on behalf of the plan or issuer, so long as such activities are conducted in accordance with a utilization review program that meets the requirements of this section. (3) Utilization review defined.--For purposes of this section, the terms ``utilization [[Page H9524]] review'' and ``utilization review activities'' mean procedures used to monitor or evaluate the use or coverage, clinical necessity, appropriateness, efficacy, or efficiency of health care services, procedures or settings, and includes prospective review, concurrent review, second opinions, case management, discharge planning, or retrospective review. (b) Written Policies and Criteria.-- (1) Written policies.--A utilization review program shall be conducted consistent with written policies and procedures that govern all aspects of the program. (2) Use of written criteria.-- (A) In general.--Such a program shall utilize written clinical review criteria developed with input from a range of appropriate actively practicing health care professionals, as determined by the plan, pursuant to the program. Such criteria shall include written clinical review criteria that are based on valid clinical evidence where available and that are directed specifically at meeting the needs of at-risk populations and covered individuals with chronic conditions or severe illnesses, including gender-specific criteria and pediatric-specific criteria where available and appropriate. (B) Continuing use of standards in retrospective review.-- If a health care service has been specifically pre-authorized or approved for an enrollee under such a program, the program shall not, pursuant to retrospective review, revise or modify the specific standards, criteria, or procedures used for the utilization review for procedures, treatment, and services delivered to the enrollee during the same course of treatment. (C) Review of sample of claims denials.--Such a program shall provide for an evaluation of the clinical appropriateness of at least a sample of denials of claims for benefits. (c) Conduct of Program Activities.-- (1) Administration by health care professionals.--A utilization review program shall be administered by qualified health care professionals who shall oversee review decisions. (2) Use of qualified, independent personnel.-- (A) In general.--A utilization review program shall provide for the conduct of utilization review activities only through personnel who are qualified and have received appropriate training in the conduct of such activities under the program. (B) Prohibition of contingent compensation arrangements.-- Such a program shall not, with respect to utilization review activities, permit or provide compensation or anything of value to its employees, agents, or contractors in a manner that encourages denials of claims for benefits. (C) Prohibition of conflicts.--Such a program shall not permit a health care professional who is providing health care services to an individual to perform utilization review activities in connection with the health care services being provided to the individual. (3) Accessibility of review.--Such a program shall provide that appropriate personnel performing utilization review activities under the program, including the utilization review administrator, are reasonably accessible by toll-free telephone during normal business hours to discuss patient care and allow response to telephone requests, and that appropriate provision is made to receive and respond promptly to calls received during other hours. (4) Limits on frequency.--Such a program shall not provide for the performance of utilization review activities with respect to a class of services furnished to an individual more frequently than is reasonably required to assess whether the services under review are medically necessary or appropriate. (d) Deadline for Determinations.-- (1) Prior authorization services.-- (A) In general.--Except as provided in paragraph (2), in the case of a utilization review activity involving the prior authorization of health care items and services for an individual, the utilization review program shall make a determination concerning such authorization, and provide notice of the determination to the individual or the individual's designee and the individual's health care provider by telephone and in printed form, as soon as possible in accordance with the medical exigencies of the case, and in no event later than the deadline specified in subparagraph (B). (B) Deadline.-- (i) In general.--Subject to clauses (ii) and (iii), the deadline specified in this subparagraph is 14 days after the date of receipt of the request for prior authorization. (ii) Extension permitted where notice of additional information required.--If a utilization review program-- (I) receives a request for a prior authorization, (II) determines that additional information is necessary to complete the review and make the determination on the request, and (III) notifies the requester, not later than five business days after the date of receiving the request, of the need for such specified additional information, the deadline specified in this subparagraph is 14 days after the date the program receives the specified additional information, but in no case later than 28 days after the date of receipt of the request for the prior authorization. This clause shall not apply if the deadline is specified in clause (iii). (iii) Expedited cases.--In the case of a situation described in section 102(c)(1)(A), the deadline specified in this subparagraph is 72 hours after the time of the request for prior authorization. (2) Ongoing care.-- (A) Concurrent review.-- (i) In general.--Subject to subparagraph (B), in the case of a concurrent review of ongoing care (including hospitalization), which results in a termination or reduction of such care, the plan must provide by telephone and in printed form notice of the concurrent review determination to the individual or the individual's designee and the individual's health care provider as soon as possible in accordance with the medical exigencies of the case, with sufficient time prior to the termination or reduction to allow for an appeal under section 102(c)(1)(A) to be completed before the termination or reduction takes effect. (ii) Contents of notice.--Such notice shall include, with respect to ongoing health care items and services, the number of ongoing services approved, the new total of approved services, the date of onset of services, and the next review date, if any, as well as a statement of the individual's rights to further appeal. (B) Exception.--Subparagraph (A) shall not be interpreted as requiring plans or issuers to provide coverage of care that would exceed the coverage limitations for such care. (3) Previously provided services.--In the case of a utilization review activity involving retrospective review of health care services previously provided for an individual, the utilization review program shall make a determination concerning such services, and provide notice of the determination to the individual or the individual's designee and the individual's health care provider by telephone and in printed form, within 30 days of the date of receipt of information that is reasonably necessary to make such determination, but in no case later than 60 days after the date of receipt of the claim for benefits. (4) Failure to meet deadline.--In a case in which a group health plan or health insurance issuer fails to make a determination on a claim for benefit under paragraph (1), (2)(A), or (3) by the applicable deadline established under the respective paragraph, the failure shall be treated under this subtitle as a denial of the claim as of the date of the deadline. (5) Reference to special rules for emergency services, maintenance care, and post-stabilization care.--For waiver of prior authorization requirements in certain cases involving emergency services and maintenance care and post- stabilization care, see subsections (a)(1) and (b) of section 113, respectively. (e) Notice of Denials of Claims for Benefits.-- (1) In general.--Notice of a denial of claims for benefits under a utilization review program shall be provided in printed form and written in a manner calculated to be understood by the participant, beneficiary, or enrollee and shall include-- (A) the reasons for the denial (including the clinical rationale); (B) instructions on how to initiate an appeal under section 102; and (C) notice of the availability, upon request of the individual (or the individual's designee) of the clinical review criteria relied upon to make such denial. (2) Specification of any additional information.--Such a notice shall also specify what (if any) additional necessary information must be provided to, or obtained by, the person making the denial in order to make a decision on such an appeal. (f) Claim for Benefits and Denial of Claim for Benefits Defined.--For purposes of this subtitle: (1) Claim for benefits.--The term ``claim for benefits'' means any request for coverage (including authorization of coverage), for eligibility, or for payment in whole or in part, for an item or service under a group health plan or health insurance coverage. (2) Denial of claim for benefits.--The term ``denial'' means, with respect to a claim for benefits, means a denial, or a failure to act on a timely basis upon, in whole or in part, the claim for benefits and includes a failure to provide benefits (including items and services) required to be provided under this title. SEC. 102. INTERNAL APPEALS PROCEDURES. (a) Right of Review.-- (1) In general.--Each group health plan, and each health insurance issuer offering health insurance coverage-- (A) shall provide adequate notice in writing to any participant or beneficiary under such plan, or enrollee under such coverage, whose claim for benefits under the plan or coverage has been denied (within the meaning of section 101(f)(2)), setting forth the specific reasons for such denial of claim for benefits and rights to any further review or appeal, written in a manner calculated to be understood by the participant, beneficiary, or enrollee; and (B) shall afford such a participant, beneficiary, or enrollee (and any provider or other person acting on behalf of such an individual with the individual's consent or without such consent if the individual is medically unable to provide such consent) who is dissatisfied with such a denial of claim for benefits a reasonable opportunity (of not less than 180 days) to request and obtain a full and fair review by a named fiduciary (with respect to such plan) or named appropriate [[Page H9525]] individual (with respect to such coverage) of the decision denying the claim. (2) Treatment of oral requests.--The request for review under paragraph (1)(B) may be made orally, but, in the case of an oral request, shall be followed by a request in writing. (b) Internal Review Process.-- (1) Conduct of review.-- (A) In general.--A review of a denial of claim under this section shall be made by an individual who-- (i) in a case involving medical judgment, shall be a physician or, in the case of limited scope coverage (as defined in subparagraph (B), shall be an appropriate specialist; (ii) has been selected by the plan or issuer; and (iii) did not make the initial denial in the internally appealable decision. (B) Limited scope coverage defined.--For purposes of subparagraph (A), the term ``limited scope coverage'' means a group health plan or health insurance coverage the only benefits under which are for benefits described in section 2791(c)(2)(A) of the Public Health Service Act (42 U.S.C. 300gg-91(c)(2)). (2) Time limits for internal reviews.-- (A) In general.--Having received such a request for review of a denial of claim, the plan or issuer shall, in accordance with the medical exigencies of the case but not later than the deadline specified in subparagraph (B), complete the review on the denial and transmit to the participant, beneficiary, enrollee, or other person involved a decision that affirms, reverses, or modifies the denial. If the decision does not reverse the denial, the plan or issuer shall transmit, in printed form, a notice that sets forth the grounds for such decision and that includes a description of rights to any further appeal. Such decision shall be treated as the final decision of the plan. Failure to issue such a decision by such deadline shall be treated as a final decision affirming the denial of claim. (B) Deadline.-- (i) In general.--Subject to clauses (ii) and (iii), the deadline specified in this subparagraph is 14 days after the date of receipt of the request for internal review. (ii) Extension permitted where notice of additional information required.--If a group health plan or health insurance issuer-- (I) receives a request for internal review, (II) determines that additional information is necessary to complete the review and make the determination on the request, and (III) notifies the requester, not later than five business days after the date of receiving the request, of the need for such specified additional information, the deadline specified in this subparagraph is 14 days after the date the plan or issuer receives the specified additional information, but in no case later than 28 days after the date of receipt of the request for the internal review. This clause shall not apply if the deadline is specified in clause (iii). (iii) Expedited cases.--In the case of a situation described in subsection (c)(1)(A), the deadline specified in this subparagraph is 72 hours after the time of the request for review. (c) Expedited Review Process.-- (1) In general.--A group health plan, and a health insurance issuer, shall establish procedures in writing for the expedited consideration of requests for review under subsection (b) in situations-- (A) in which the application of the normal timeframe for making a determination could seriously jeopardize the life or health of the participant, beneficiary, or enrollee or such an individual's ability to regain maximum function; or (B) described in section 101(d)(2) (relating to requests for continuation of ongoing care which would otherwise be reduced or terminated). (2) Process.--Under such procedures-- (A) the request for expedited review may be submitted orally or in writing by an individual or provider who is otherwise entitled to request the review; (B) all necessary information, including the plan's or issuer's decision, shall be transmitted between the plan or issuer and the requester by telephone, facsimile, or other similarly expeditious available method; and (C) the plan or issuer shall expedite the review in the case of any of the situations described in subparagraph (A) or (B) of paragraph (1). (3) Deadline for decision.--The decision on the expedited review must be made and communicated to the parties as soon as possible in accordance with the medical exigencies of the case, and in no event later than 72 hours after the time of receipt of the request for expedited review, except that in a case described in paragraph (1)(B), the decision must be made before the end of the approved period of care. (d) Waiver of Process.--A plan or issuer may waive its rights for an internal review under subsection (b). In such case the participant, beneficiary, or enrollee involved (and any designee or provider involved) shall be relieved of any obligation to complete the review involved and may, at the option of such participant, beneficiary, enrollee, designee, or provider, proceed directly to seek further appeal through any applicable external appeals process. SEC. 103. EXTERNAL APPEALS PROCEDURES. (a) Right to External Appeal.-- (1) In general.--A group health plan, and a health insurance issuer offering health insurance coverage, shall provide for an external appeals process that meets the requirements of this section in the case of an externally appealable decision described in paragraph (2), for which a timely appeal is made either by the plan or issuer or by the participant, beneficiary, or enrollee (and any provider or other person acting on behalf of such an individual with the individual's consent or without such consent if such an individual is medically unable to provide such consent). The appropriate Secretary shall establish standards to carry out such requirements. (2) Externally appealable decision defined.-- (A) In general.--For purposes of this section, the term ``externally appealable decision'' means a denial of claim for benefits (as defined in section 101(f)(2))-- (i) that is based in whole or in part on a decision that the item or service is not medically necessary or appropriate or is investigational or experimental; or (ii) in which the decision as to whether a benefit is covered involves a medical judgment. (B) Inclusion.--Such term also includes a failure to meet an applicable deadline for internal review under section 102. (C) Exclusions.--Such term does not include-- (i) specific exclusions or express limitations on the amount, duration, or scope of coverage that do not involve medical judgment; or (ii) a decision regarding whether an individual is a participant, beneficiary, or enrollee under the plan or coverage. (3) Exhaustion of internal review process.--Except as provided under section 102(d), a plan or issuer may condition the use of an external appeal process in the case of an externally appealable decision upon a final decision in an internal review under section 102, but only if the decision is made in a timely basis consistent with the deadlines provided under this subtitle. (4) Filing fee requirement.-- (A) In general.--Subject to subparagraph (B), a plan or issuer may condition the use of an external appeal process upon payment to the plan or issuer of a filing fee that does not exceed $25. (B) Exception for indigency.--The plan or issuer may not require payment of the filing fee in the case of an individual participant, beneficiary, or enrollee who certifies (in a form and manner specified in guidelines established by the Secretary of Health and Human Services) that the individual is indigent (as defined in such guidelines). (C) Refunding fee in case of successful appeals.--The plan or issuer shall refund payment of the filing fee under this paragraph if the recommendation of the external appeal entity is to reverse or modify the denial of a claim for benefits which is the subject of the appeal. (b) General Elements of External Appeals Process.-- (1) Contract with qualified external appeal entity.-- (A) Contract requirement.--Except as provided in subparagraph (D), the external appeal process under this section of a plan or issuer shall be conducted under a contract between the plan or issuer and one or more qualified external appeal entities (as defined in subsection (c)). (B) Limitation on plan or issuer selection.--The applicable authority shall implement procedures-- (i) to assure that the selection process among qualified external appeal entities will not create any incentives for external appeal entities to make a decision in a biased manner, and (ii) for auditing a sample of decisions by such entities to assure that no such decisions are made in a biased manner. (C) Other terms and conditions.--The terms and conditions of a contract under this paragraph shall be consistent with the standards the appropriate Secretary shall establish to assure there is no real or apparent conflict of interest in the conduct of external appeal activities. Such contract shall provide that all costs of the process (except those incurred by the participant, beneficiary, enrollee, or treating professional in support of the appeal) shall be paid by the plan or issuer, and not by the participant, beneficiary, or enrollee. The previous sentence shall not be construed as applying to the imposition of a filing fee under subsection (a)(4). (D) State authority with respect qualified external appeal entity for health insurance issuers.--With respect to health insurance issuers offering health insurance coverage in a State, the State may provide for external review activities to be conducted by a qualified external appeal entity that is designated by the State or that is selected by the State in a manner determined by the State to assure an unbiased determination. (2) Elements of process.--An external appeal process shall be conducted consistent with standards established by the appropriate Secretary that include at least the following: (A) Fair and de novo determination.--The process shall provide for a fair, de novo determination. However, nothing in this paragraph shall be construed as providing for coverage of items and services for which benefits are specifically excluded under the plan or coverage. (B) Standard of review.--An external appeal entity shall determine whether the [[Page H9526]] plan's or issuer's decision is in accordance with the medical needs of the patient involved (as determined by the entity) taking into account, as of the time of the entity's determination, the patient's medical condition and any relevant and reliable evidence the entity obtains under subparagraph (D). If the entity determines the decision is in accordance with such needs, the entity shall affirm the decision and to the extent that the entity determines the decision is not in accordance with such needs, the entity shall reverse or modify the decision. (C) Consideration of plan or coverage definitions.--In making such determination, the external appeal entity shall consider (but not be bound by) any language in the plan or coverage document relating to the definitions of the terms medical necessity, medically necessary or appropriate, or experimental, investigational, or related terms. (D) Evidence.-- (i) In general.--An external appeal entity shall include, among the evidence taken into consideration-- (I) the decision made by the plan or issuer upon internal review under section 102 and any guidelines or standards used by the plan or issuer in reaching such decision; (II) any personal health and medical information supplied with respect to the individual whose denial of claim for benefits has been appealed; and (III) the opinion of the individual's treating physician or health care professional. (ii) Additional evidence.--Such entity may also take into consideration but not be limited to the following evidence (to the extent available): (I) The results of studies that meet professionally recognized standards of validity and replicability or that have been published in peer-reviewed journals. (II) The results of professional consensus conferences conducted or financed in whole or in part by one or more Government agencies. (III) Practice and treatment guidelines prepared or financed in whole or in part by Government agencies. (IV) Government-issued coverage and treatment policies. (V) Community standard of care and generally accepted principles of professional medical practice. (VI) To the extent that the entity determines it to be free of any conflict of interest, the opinions of individuals who are qualified as experts in one or more fields of health care which are directly related to the matters under appeal. (VII) To the extent that the entity determines it to be free of any conflict of interest, the results of peer reviews conducted by the plan or issuer involved. (E) Determination concerning externally appealable decisions.--A qualified external appeal entity shall determine-- (i) whether a denial of claim for benefits is an externally appealable decision (within the meaning of subsection (a)(2)); (ii) whether an externally appealable decision involves an expedited appeal; and (iii) for purposes of initiating an external review, whether the internal review process has been completed. (F) Opportunity to submit evidence.--Each party to an externally appealable decision may submit evidence related to the issues in dispute. (G) Provision of information.--The plan or issuer involved shall provide timely access to the external appeal entity to information and to provisions of the plan or health insurance coverage relating to the matter of the externally appealable decision, as determined by the entity. (H) Timely decisions.--A determination by the external appeal entity on the decision shall-- (i) be made orally or in writing and, if it is made orally, shall be supplied to the parties in writing as soon as possible; (ii) be made in accordance with the medical exigencies of the case involved, but in no event later than 21 days after the date (or, in the case of an expedited appeal, 72 hours after the time) of requesting an external appeal of the decision; (iii) state, in layperson's language, the basis for the determination, including, if relevant, any basis in the terms or conditions of the plan or coverage; and (iv) inform the participant, beneficiary, or enrollee of the individual's rights (including any limitation on such rights) to seek further review by the courts (or other process) of the external appeal determination. (I) Compliance with determination.--If the external appeal entity reverses or modifies the denial of a claim for benefits, the plan or issuer shall-- (i) upon the receipt of the determination, authorize benefits in accordance with such determination; (ii) take such actions as may be necessary to provide benefits (including items or services) in a timely manner consistent with such determination; and (iii) submit information to the entity documenting compliance with the entity's determination and this subparagraph. (c) Qualifications of External Appeal Entities.-- (1) In general.--For purposes of this section, the term ``qualified external appeal entity'' means, in relation to a plan or issuer, an entity that is certified under paragraph (2) as meeting the following requirements: (A) The entity meets the independence requirements of paragraph (3). (B) The entity conducts external appeal activities through a panel of not fewer than three clinical peers. (C) The entity has sufficient medical, legal, and other expertise and sufficient staffing to conduct external appeal activities for the plan or issuer on a timely basis consistent with subsection (b)(2)(G). (D) The entity meets such other requirements as the appropriate Secretary may impose. (2) Initial certification of external appeal entities.-- (A) In general.--In order to be treated as a qualified external appeal entity with respect to-- (i) a group health plan, the entity must be certified (and, in accordance with subparagraph (B), periodically recertified) as meeting the requirements of paragraph (1)-- (I) by the Secretary of Labor; (II) under a process recognized or approved by the Secretary of Labor; or (III) to the extent provided in subparagraph (C)(i), by a qualified private standard-setting organization (certified under such subparagraph); or (ii) a health insurance issuer operating in a State, the entity must be certified (and, in accordance with subparagraph (B), periodically recertified) as meeting such requirements-- (I) by the applicable State authority (or under a process recognized or approved by such authority); or (II) if the State has not established a certification and recertification process for such entities, by the Secretary of Health and Human Services, under a process recognized or approved by such Secretary, or to the extent provided in subparagraph (C)(ii), by a qualified private standard-setting organization (certified under such subparagraph). (B) Recertification process.--The appropriate Secretary shall develop standards for the recertification of external appeal entities. Such standards shall include a review of-- (i) the number of cases reviewed; (ii) a summary of the disposition of those cases; (iii) the length of time in making determinations on those cases; (iv) updated information of what was required to be submitted as a condition of certification for the entity's performance of external appeal activities; and (v) such information as may be necessary to assure the independence of the entity from the plans or issuers for which external appeal activities are being conducted. (C) Certification of qualified private standard-setting organizations.-- (i) For external reviews under group health plans.--For purposes of subparagraph (A)(i)(III), the Secretary of Labor may provide for a process for certification (and periodic recertification) of qualified private standard-setting organizations which provide for certification of external review entities. Such an organization shall only be certified if the organization does not certify an external review entity unless it meets standards required for certification of such an entity by such Secretary under subparagraph (A)(i)(I). (ii) For external reviews of health insurance issuers.--For purposes of subparagraph (A)(ii)(II), the Secretary of Health and Human Services may provide for a process for certification (and periodic recertification) of qualified private standard-setting organizations which provide for certification of external review entities. Such an organization shall only be certified if the organization does not certify an external review entity unless it meets standards required for certification of such an entity by such Secretary under subparagraph (A)(ii)(II). (3) Independence requirements.-- (A) In general.--A clinical peer or other entity meets the independence requirements of this paragraph if-- (i) the peer or entity does not have a familial, financial, or professional relationship with any related party; (ii) any compensation received by such peer or entity in connection with the external review is reasonable and not contingent on any decision rendered by the peer or entity; (iii) except as provided in paragraph (4), the plan and the issuer have no recourse against the peer or entity in connection with the external review; and (iv) the peer or entity does not otherwise have a conflict of interest with a related party as determined under any regulations which the Secretary may prescribe. (B) Related party.--For purposes of this paragraph, the term ``related party'' means-- (i) with respect to-- (I) a group health plan or health insurance coverage offered in connection with such a plan, the plan or the health insurance issuer offering such coverage, or (II) individual health insurance coverage, the health insurance issuer offering such coverage, or any plan sponsor, fiduciary, officer, director, or management employee of such plan or issuer; (ii) the health care professional that provided the health care involved in the coverage decision; (iii) the institution at which the health care involved in the coverage decision is provided; (iv) the manufacturer of any drug or other item that was included in the health care involved in the coverage decision; or [[Page H9527]] (v) any other party determined under any regulations which the Secretary may prescribe to have a substantial interest in the coverage decision. (4) Limitation on liability of reviewers.--No qualified external appeal entity having a contract with a plan or issuer under this part and no person who is employed by any such entity or who furnishes professional services to such entity, shall be held by reason of the performance of any duty, function, or activity required or authorized pursuant to this section, to have violated any criminal law, or to be civilly liable under any law of the United States or of any State (or political subdivision thereof) if due care was exercised in the performance of such duty, function, or activity and there was no actual malice or gross misconduct in the performance of such duty, function, or activity. (d) External Appeal Determination Binding on Plan.--The determination by an external appeal entity under this section is binding on the plan and issuer involved in the determination. (e) Penalties Against Authorized Officials for Refusing to Authorize the Determination of an External Review Entity.-- (1) Monetary penalties.--In any case in which the determination of an external review entity is not followed by a group health plan, or by a health insurance issuer offering health insurance coverage, any person who, acting in the capacity of authorizing the benefit, causes such refusal may, in the discretion in a court of competent jurisdiction, be liable to an aggrieved participant, beneficiary, or enrollee for a civil penalty in an amount of up to $1,000 a day from the date on which the determination was transmitted to the plan or issuer by the external review entity until the date the refusal to provide the benefit is corrected. (2) Cease and desist order and order of attorney's fees.-- In any action described in paragraph (1) brought by a participant, beneficiary, or enrollee with respect to a group health plan, or a health insurance issuer offering health insurance coverage, in which a plaintiff alleges that a person referred to in such paragraph has taken an action resulting in a refusal of a benefit determined by an external appeal entity in violation of such terms of the plan, coverage, or this subtitle, or has failed to take an action for which such person is responsible under the plan, coverage, or this title and which is necessary under the plan or coverage for authorizing a benefit, the court shall cause to be served on the defendant an order requiring the defendant-- (A) to cease and desist from the alleged action or failure to act; and (B) to pay to the plaintiff a reasonable attorney's fee and other reasonable costs relating to the prosecution of the action on the charges on which the plaintiff prevails. (3) Additional civil penalties.-- (A) In general.--In addition to any penalty imposed under paragraph (1) or (2), the appropriate Secretary may assess a civil penalty against a person acting in the capacity of authorizing a benefit determined by an external review entity for one or more group health plans, or health insurance issuers offering health insurance coverage, for-- (i) any pattern or practice of repeated refusal to authorize a benefit determined by an external appeal entity in violation of the terms of such a plan, coverage, or this title; or (ii) any pattern or practice of repeated violations of the requirements of this section with respect to such plan or plans or coverage. (B) Standard of proof and amount of penalty.--Such penalty shall be payable only upon proof by clear and convincing evidence of such pattern or practice and shall be in an amount not to exceed the lesser of-- (i) 25 percent of the aggregate value of benefits shown by the appropriate Secretary to have not been provided, or unlawfully delayed, in violation of this section under such pattern or practice, or (ii) $500,000. (4) Removal and disqualification.--Any person acting in the capacity of authorizing benefits who has engaged in any such pattern or practice described in paragraph (3)(A) with respect to a plan or coverage, upon the petition of the appropriate Secretary, may be removed by the court from such position, and from any other involvement, with respect to such a plan or coverage, and may be precluded from returning to any such position or involvement for a period determined by the court. (f) Protection of Legal Rights.--Nothing in this subtitle shall be construed as altering or eliminating any cause of action or legal rights or remedies of participants, beneficiaries, enrollees, and others under State or Federal law (including sections 502 and 503 of the Employee Retirement Income Security Act of 1974), including the right to file judicial actions to enforce rights. SEC. 104. ESTABLISHMENT OF A GRIEVANCE PROCESS. (a) Establishment of Grievance System.-- (1) In general.--A group health plan, and a health insurance issuer in connection with the provision of health insurance coverage, shall establish and maintain a system to provide for the presentation and resolution of oral and written grievances brought by individuals who are participants, beneficiaries, or enrollees, or health care providers or other individuals acting on behalf of an individual and with the individual's consent or without such consent if the individual is medically unable to provide such consent, regarding any aspect of the plan's or issuer's services. (2) Grievance defined.--In this section, the term ``grievance'' means any question, complaint, or concern brought by a participant, beneficiary or enrollee that is not a claim for benefits (as defined in section 101(f)(1)). (b) Grievance System.--Such system shall include the following components with respect to individuals who are participants, beneficiaries, or enrollees: (1) Written notification to all such individuals and providers of the telephone numbers and business addresses of the plan or issuer personnel responsible for resolution of grievances and appeals. (2) A system to record and document, over a period of at least three previous years, all grievances and appeals made and their status. (3) A process providing for timely processing and resolution of grievances. (4) Procedures for follow-up action, including the methods to inform the person making the grievance of the resolution of the grievance. Grievances are not subject to appeal under the previous provisions of this subtitle. Subtitle B--Access to Care SEC. 111. CONSUMER CHOICE OPTION. (a) In General.--If a health insurance issuer offers to enrollees health insurance coverage in connection with a group health plan which provides for coverage of services only if such services are furnished through health care professionals and providers who are members of a network of health care professionals and providers who have entered into a contract with the issuer to provide such services, the issuer shall also offer or arrange to be offered to such enrollees (at the time of enrollment and during an annual open season as provided under subsection (c)) the option of health insurance coverage which provides for coverage of such services which are not furnished through health care professionals and providers who are members of such a network unless enrollees are offered such non-network coverage through another group health plan or through another health insurance issuer in the group market. (b) Additional Costs.--The amount of any additional premium charged by the health insurance issuer for the additional cost of the creation and maintenance of the option described in subsection (a) and the amount of any additional cost sharing imposed under such option shall be borne by the enrollee unless it is paid by the health plan sponsor through agreement with the health insurance issuer. (c) Open Season.--An enrollee may change to the offering provided under this section only during a time period determined by the health insurance issuer. Such time period shall occur at least annually. SEC. 112. CHOICE OF HEALTH CARE PROFESSIONAL. (a) Primary Care.--If a group health plan, or a health insurance issuer that offers health insurance coverage, requires or provides for designation by a participant, beneficiary, or enrollee of a participating primary care provider, then the plan or issuer shall permit each participant, beneficiary, and enrollee to designate any participating primary care provider who is available to accept such individual. (b) Specialists.-- (1) In general.--Subject to paragraph (2), a group health plan and a health insurance issuer that offers health insurance coverage shall permit each participant, beneficiary, or enrollee to receive medically necessary or appropriate specialty care, pursuant to appropriate referral procedures, from any qualified participating health care professional who is available to accept such individual for such care. (2) Limitation.--Paragraph (1) shall not apply to specialty care if the plan or issuer clearly informs participants, beneficiaries, and enrollees of the limitations on choice of participating health care professionals with respect to such care. (3) Construction.--Nothing in this subsection shall be construed as affecting the application of section 114 (relating to access to specialty care). SEC. 113. ACCESS TO EMERGENCY CARE. (a) Coverage of Emergency Services.-- (1) In general.--If a group health plan, or health insurance coverage offered by a health insurance issuer, provides any benefits with respect to services in an emergency department of a hospital, the plan or issuer shall cover emergency services (as defined in paragraph (2)(B))-- (A) without the need for any prior authorization determination; (B) whether or not the health care provider furnishing such services is a participating provider with respect to such services; (C) in a manner so that, if such services are provided to a participant, beneficiary, or enrollee-- (i) by a nonparticipating health care provider with or without prior authorization, or (ii) by a participating health care provider without prior authorization, the participant, beneficiary, or enrollee is not liable for amounts that exceed the amounts of liability that would be incurred if the services were provided by a participating health care provider with prior authorization; and [[Page H9528]] (D) without regard to any other term or condition of such coverage (other than exclusion or coordination of benefits, or an affiliation or waiting period, permitted under section 2701 of the Public Health Service Act, section 701 of the Employee Retirement Income Security Act of 1974, or section 9801 of the Internal Revenue Code of 1986, and other than applicable cost-sharing). (2) Definitions.--In this section: (A) Emergency medical condition based on prudent layperson standard.--The term ``emergency medical condition'' means a medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain) such that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect the absence of immediate medical attention to result in a condition described in clause (i), (ii), or (iii) of section 1867(e)(1)(A) of the Social Security Act. (B) Emergency services.--The term ``emergency services'' means-- (i) a medical screening examination (as required under section 1867 of the Social Security Act) that is within the capability of the emergency department of a hospital, including ancillary services routinely available to the emergency department to evaluate an emergency medical condition (as defined in subparagraph (A)), and (ii) within the capabilities of the staff and facilities available at the hospital, such further medical examination and treatment as are required under section 1867 of such Act to stabilize the patient. (C) Stabilize.--The term ``to stabilize'' means, with respect to an emergency medical condition, to provide such medical treatment of the condition as may be necessary to assure, within reasonable medical probability, that no material deterioration of the condition is likely to result from or occur during the transfer of the individual from a facility. (b) Reimbursement for Maintenance Care and Post- Stabilization Care.--In the case of services (other than emergency services) for which benefits are available under a group health plan, or under health insurance coverage offered by a health insurance issuer, the plan or issuer shall provide for reimbursement with respect to such services provided to a participant, beneficiary, or enrollee other than through a participating health care provider in a manner consistent with subsection (a)(1)(C) (and shall otherwise comply with the guidelines established under section 1852(d)(2) of the Social Security Act), if the services are maintenance care or post-stabilization care covered under such guidelines. SEC. 114. ACCESS TO SPECIALTY CARE. (a) Specialty Care for Covered Services.-- (1) In general.--If-- (A) an individual is a participant or beneficiary under a group health plan or an enrollee who is covered under health insurance coverage offered by a health insurance issuer, (B) the individual has a condition or disease of sufficient seriousness and complexity to require treatment by a specialist, and (C) benefits for such treatment are provided under the plan or coverage, the plan or issuer shall make or provide for a referral to a specialist who is available and accessible to provide the treatment for such condition or disease. (2) Specialist defined.--For purposes of this subsection, the term ``specialist'' means, with respect to a condition, a health care practitioner, facility, or center that has adequate expertise through appropriate training and experience (including, in the case of a child, appropriate pediatric expertise) to provide high quality care in treating the condition. (3) Care under referral.--A group health plan or health insurance issuer may require that the care provided to an individual pursuant to such referral under paragraph (1) be-- (A) pursuant to a treatment plan, only if the treatment plan is developed by the specialist and approved by the plan or issuer, in consultation with the designated primary care provider or specialist and the individual (or the individual's designee), and (B) in accordance with applicable quality assurance and utilization review standards of the plan or issuer. Nothing in this subsection shall be construed as preventing such a treatment plan for an individual from requiring a specialist to provide the primary care provider with regular updates on the specialty care provided, as well as all necessary medical information. (4) Referrals to participating providers.--A group health plan or health insurance issuer is not required under paragraph (1) to provide for a referral to a specialist that is not a participating provider, unless the plan or issuer does not have an appropriate specialist that is available and accessible to treat the individual's condition and that is a participating provider with respect to such treatment. (5) Treatment of nonparticipating providers.--If a plan or issuer refers an individual to a nonparticipating specialist pursuant to paragraph (1), services provided pursuant to the approved treatment plan (if any) shall be provided at no additional cost to the individual beyond what the individual would otherwise pay for services received by such a specialist that is a participating provider. (b) Specialists as Gatekeeper for Treatment of Ongoing Special Conditions.-- (1) In general.--A group health plan, or a health insurance issuer, in connection with the provision of health insurance coverage, shall have a procedure by which an individual who is a participant, beneficiary, or enrollee and who has an ongoing special condition (as defined in paragraph (3)) may request and receive a referral to a specialist for such condition who shall be responsible for and capable of providing and coordinating the individual's care with respect to the condition. Under such procedures if such an individual's care would most appropriately be coordinated by such a specialist, such plan or issuer shall refer the individual to such specialist. (2) Treatment for related referrals.--Such specialists shall be permitted to treat the individual without a referral from the individual's primary care provider and may authorize such referrals, procedures, tests, and other medical services as the individual's primary care provider would otherwise be permitted to provide or authorize, subject to the terms of the treatment (referred to in subsection (a)(3)(A)) with respect to the ongoing special condition. (3) Ongoing special condition defined.--In this subsection, the term ``ongoing special condition'' means a condition or disease that-- (A) is life-threatening, degenerative, or disabling, and (B) requires specialized medical care over a prolonged period of time. (4) Terms of referral.--The provisions of paragraphs (3) through (5) of subsection (a) apply with respect to referrals under paragraph (1) of this subsection in the same manner as they apply to referrals under subsection (a)(1). (c) Standing Referrals.-- (1) In general.--A group health plan, and a health insurance issuer in connection with the provision of health insurance coverage, shall have a procedure by which an individual who is a participant, beneficiary, or enrollee and who has a condition that requires ongoing care from a specialist may receive a standing referral to such specialist for treatment of such condition. If the plan or issuer, or if the primary care provider in consultation with the medical director of the plan or issuer and the specialist (if any), determines that such a standing referral is appropriate, the plan or issuer shall make such a referral to such a specialist if the individual so desires. (2) Terms of referral.--The provisions of paragraphs (3) through (5) of subsection (a) apply with respect to referrals under paragraph (1) of this subsection in the same manner as they apply to referrals under subsection (a)(1). SEC. 115. ACCESS TO OBSTETRICAL AND GYNECOLOGICAL CARE. (a) In General.--If a group health plan, or a health insurance issuer in connection with the provision of health insurance coverage, requires or provides for a participant, beneficiary, or enrollee to designate a participating primary care health care professional, the plan or issuer-- (1) may not require authorization or a referral by the individual's primary care health care professional or otherwise for coverage of gynecological care (including preventive women's health examinations) and pregnancy-related services provided by a participating health care professional, including a physician, who specializes in obstetrics and gynecology to the extent such care is otherwise covered, and (2) shall treat the ordering of other obstetrical or gynecological care by such a participating professional as the authorization of the primary care health care professional with respect to such care under the plan or coverage. (b) Construction.--Nothing in subsection (a) shall be construed to-- (1) waive any exclusions of coverage under the terms of the plan or health insurance coverage with respect to coverage of obstetrical or gynecological care; or (2) preclude the group health plan or health insurance issuer involved from requiring that the obstetrical or gynecological provider notify the primary care health care professional or the plan or issuer of treatment decisions. SEC. 116. ACCESS TO PEDIATRIC CARE. (a) Pediatric Care.--If a group health plan, or a health insurance issuer in connection with the provision of health insurance coverage, requires or provides for an enrollee to designate a participating primary care provider for a child of such enrollee, the plan or issuer shall permit the enrollee to designate a physician who specializes in pediatrics as the child's primary care provider. (b) Construction.--Nothing in subsection (a) shall be construed to waive any exclusions of coverage under the terms of the plan or health insurance coverage with respect to coverage of pediatric care. SEC. 117. CONTINUITY OF CARE. (a) In General.-- (1) Termination of provider.--If a contract between a group health plan, or a health insurance issuer in connection with the provision of health insurance coverage, and a health care provider is terminated (as defined in paragraph (3)(B)), or benefits or coverage provided by a health care provider are terminated because of a change in the terms of provider participation in a group health plan, and an individual who is a participant, beneficiary, or enrollee in the plan or coverage is undergoing treatment from the provider for an ongoing special condition [[Page H9529]] (as defined in paragraph (3)(A)) at the time of such termination, the plan or issuer shall-- (A) notify the individual on a timely basis of such termination and of the right to elect continuation of coverage of treatment by the provider under this section;

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All articles in House section

BIPARTISAN CONSENSUS MANAGED CARE IMPROVEMENT ACT OF 1999
(House of Representatives - October 07, 1999)

Text of this article available as: TXT PDF [Pages H9523-H9636] BIPARTISAN CONSENSUS MANAGED CARE IMPROVEMENT ACT OF 1999 The SPEAKER pro tempore (Mrs. Biggert). Pursuant to House Resolution 323 and rule XXVIII, the Chair declares the House in the Committee of the Whole House on the State of the Union for the further consideration of the bill, H.R. 2723. {time} 1107 In the Committee of the Whole Accordingly, the House resolved itself into the Committee of the Whole House on the State of the Union for the further consideration of the bill (H.R. 2723) to amend Title I of the Employee Retirement Income Security Act of 1974, title XXVII of the Public Health Service Act, and the Internal Revenue Code of 1986 to protect consumers in managed care plans and other health coverage, with Mr. Hastings of Washington in the chair. The Clerk read the title of the bill. The CHAIRMAN. When the Committee of the Whole rose on Wednesday, October 6, 1999, all time for general debate had expired. Pursuant to the rule, the amendments printed in part A of House Report 106-366 are adopted and the bill, as amended, is considered read for amendment under the 5-minute rule. The text of H.R. 2723, as amended, is as follows: H.R. 2723 Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE; TABLE OF CONTENTS. (a) Short Title.--This Act may be cited as the ``Bipartisan Consensus Managed Care Improvement Act of 1999''. (b) Table of Contents.--The table of contents of this Act is as follows: Sec. 1. Short title; table of contents. TITLE I--IMPROVING MANAGED CARE Subtitle A--Grievances and Appeals Sec. 101. Utilization review activities. Sec. 102. Internal appeals procedures. Sec. 103. External appeals procedures. Sec. 104. Establishment of a grievance process. Subtitle B--Access to Care Sec. 111. Consumer choice option. Sec. 112. Choice of health care professional. Sec. 113. Access to emergency care. Sec. 114. Access to specialty care. Sec. 115. Access to obstetrical and gynecological care. Sec. 116. Access to pediatric care. Sec. 117. Continuity of care. Sec. 118. Access to needed prescription drugs. Sec. 119. Coverage for individuals participating in approved clinical trials. Subtitle C--Access to Information Sec. 121. Patient access to information. Subtitle D--Protecting the Doctor-Patient Relationship Sec. 131. Prohibition of interference with certain medical communications. Sec. 132. Prohibition of discrimination against providers based on licensure. Sec. 133. Prohibition against improper incentive arrangements. Sec. 134. Payment of claims. Sec. 135. Protection for patient advocacy. Subtitle E--Definitions Sec. 151. Definitions. Sec. 152. Preemption; State flexibility; construction. Sec. 153. Exclusions. Sec. 154. Coverage of limited scope plans. Sec. 155. Regulations. TITLE II--APPLICATION OF QUALITY CARE STANDARDS TO GROUP HEALTH PLANS AND HEALTH INSURANCE COVERAGE UNDER THE PUBLIC HEALTH SERVICE ACT Sec. 201. Application to group health plans and group health insurance coverage. Sec. 202. Application to individual health insurance coverage. TITLE III--AMENDMENTS TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974 Sec. 301. Application of patient protection standards to group health plans and group health insurance coverage under the Employee Retirement Income Security Act of 1974. Sec. 302. ERISA preemption not to apply to certain actions involving health insurance policyholders. TITLE IV--APPLICATION TO GROUP HEALTH PLANS UNDER THE INTERNAL REVENUE CODE OF 1986 Sec. 401. Amendments to the Internal Revenue Code of 1986. TITLE V--EFFECTIVE DATES; COORDINATION IN IMPLEMENTATION Sec. 501. Effective dates. Sec. 502. Coordination in implementation. TITLE VI--HEALTH CARE PAPERWORK SIMPLIFICATION Sec. 601. Health care paperwork simplification. TITLE I--IMPROVING MANAGED CARE Subtitle A--Grievance and Appeals SEC. 101. UTILIZATION REVIEW ACTIVITIES. (a) Compliance With Requirements.-- (1) In general.--A group health plan, and a health insurance issuer that provides health insurance coverage, shall conduct utilization review activities in connection with the provision of benefits under such plan or coverage only in accordance with a utilization review program that meets the requirements of this section. (2) Use of outside agents.--Nothing in this section shall be construed as preventing a group health plan or health insurance issuer from arranging through a contract or otherwise for persons or entities to conduct utilization review activities on behalf of the plan or issuer, so long as such activities are conducted in accordance with a utilization review program that meets the requirements of this section. (3) Utilization review defined.--For purposes of this section, the terms ``utilization [[Page H9524]] review'' and ``utilization review activities'' mean procedures used to monitor or evaluate the use or coverage, clinical necessity, appropriateness, efficacy, or efficiency of health care services, procedures or settings, and includes prospective review, concurrent review, second opinions, case management, discharge planning, or retrospective review. (b) Written Policies and Criteria.-- (1) Written policies.--A utilization review program shall be conducted consistent with written policies and procedures that govern all aspects of the program. (2) Use of written criteria.-- (A) In general.--Such a program shall utilize written clinical review criteria developed with input from a range of appropriate actively practicing health care professionals, as determined by the plan, pursuant to the program. Such criteria shall include written clinical review criteria that are based on valid clinical evidence where available and that are directed specifically at meeting the needs of at-risk populations and covered individuals with chronic conditions or severe illnesses, including gender-specific criteria and pediatric-specific criteria where available and appropriate. (B) Continuing use of standards in retrospective review.-- If a health care service has been specifically pre-authorized or approved for an enrollee under such a program, the program shall not, pursuant to retrospective review, revise or modify the specific standards, criteria, or procedures used for the utilization review for procedures, treatment, and services delivered to the enrollee during the same course of treatment. (C) Review of sample of claims denials.--Such a program shall provide for an evaluation of the clinical appropriateness of at least a sample of denials of claims for benefits. (c) Conduct of Program Activities.-- (1) Administration by health care professionals.--A utilization review program shall be administered by qualified health care professionals who shall oversee review decisions. (2) Use of qualified, independent personnel.-- (A) In general.--A utilization review program shall provide for the conduct of utilization review activities only through personnel who are qualified and have received appropriate training in the conduct of such activities under the program. (B) Prohibition of contingent compensation arrangements.-- Such a program shall not, with respect to utilization review activities, permit or provide compensation or anything of value to its employees, agents, or contractors in a manner that encourages denials of claims for benefits. (C) Prohibition of conflicts.--Such a program shall not permit a health care professional who is providing health care services to an individual to perform utilization review activities in connection with the health care services being provided to the individual. (3) Accessibility of review.--Such a program shall provide that appropriate personnel performing utilization review activities under the program, including the utilization review administrator, are reasonably accessible by toll-free telephone during normal business hours to discuss patient care and allow response to telephone requests, and that appropriate provision is made to receive and respond promptly to calls received during other hours. (4) Limits on frequency.--Such a program shall not provide for the performance of utilization review activities with respect to a class of services furnished to an individual more frequently than is reasonably required to assess whether the services under review are medically necessary or appropriate. (d) Deadline for Determinations.-- (1) Prior authorization services.-- (A) In general.--Except as provided in paragraph (2), in the case of a utilization review activity involving the prior authorization of health care items and services for an individual, the utilization review program shall make a determination concerning such authorization, and provide notice of the determination to the individual or the individual's designee and the individual's health care provider by telephone and in printed form, as soon as possible in accordance with the medical exigencies of the case, and in no event later than the deadline specified in subparagraph (B). (B) Deadline.-- (i) In general.--Subject to clauses (ii) and (iii), the deadline specified in this subparagraph is 14 days after the date of receipt of the request for prior authorization. (ii) Extension permitted where notice of additional information required.--If a utilization review program-- (I) receives a request for a prior authorization, (II) determines that additional information is necessary to complete the review and make the determination on the request, and (III) notifies the requester, not later than five business days after the date of receiving the request, of the need for such specified additional information, the deadline specified in this subparagraph is 14 days after the date the program receives the specified additional information, but in no case later than 28 days after the date of receipt of the request for the prior authorization. This clause shall not apply if the deadline is specified in clause (iii). (iii) Expedited cases.--In the case of a situation described in section 102(c)(1)(A), the deadline specified in this subparagraph is 72 hours after the time of the request for prior authorization. (2) Ongoing care.-- (A) Concurrent review.-- (i) In general.--Subject to subparagraph (B), in the case of a concurrent review of ongoing care (including hospitalization), which results in a termination or reduction of such care, the plan must provide by telephone and in printed form notice of the concurrent review determination to the individual or the individual's designee and the individual's health care provider as soon as possible in accordance with the medical exigencies of the case, with sufficient time prior to the termination or reduction to allow for an appeal under section 102(c)(1)(A) to be completed before the termination or reduction takes effect. (ii) Contents of notice.--Such notice shall include, with respect to ongoing health care items and services, the number of ongoing services approved, the new total of approved services, the date of onset of services, and the next review date, if any, as well as a statement of the individual's rights to further appeal. (B) Exception.--Subparagraph (A) shall not be interpreted as requiring plans or issuers to provide coverage of care that would exceed the coverage limitations for such care. (3) Previously provided services.--In the case of a utilization review activity involving retrospective review of health care services previously provided for an individual, the utilization review program shall make a determination concerning such services, and provide notice of the determination to the individual or the individual's designee and the individual's health care provider by telephone and in printed form, within 30 days of the date of receipt of information that is reasonably necessary to make such determination, but in no case later than 60 days after the date of receipt of the claim for benefits. (4) Failure to meet deadline.--In a case in which a group health plan or health insurance issuer fails to make a determination on a claim for benefit under paragraph (1), (2)(A), or (3) by the applicable deadline established under the respective paragraph, the failure shall be treated under this subtitle as a denial of the claim as of the date of the deadline. (5) Reference to special rules for emergency services, maintenance care, and post-stabilization care.--For waiver of prior authorization requirements in certain cases involving emergency services and maintenance care and post- stabilization care, see subsections (a)(1) and (b) of section 113, respectively. (e) Notice of Denials of Claims for Benefits.-- (1) In general.--Notice of a denial of claims for benefits under a utilization review program shall be provided in printed form and written in a manner calculated to be understood by the participant, beneficiary, or enrollee and shall include-- (A) the reasons for the denial (including the clinical rationale); (B) instructions on how to initiate an appeal under section 102; and (C) notice of the availability, upon request of the individual (or the individual's designee) of the clinical review criteria relied upon to make such denial. (2) Specification of any additional information.--Such a notice shall also specify what (if any) additional necessary information must be provided to, or obtained by, the person making the denial in order to make a decision on such an appeal. (f) Claim for Benefits and Denial of Claim for Benefits Defined.--For purposes of this subtitle: (1) Claim for benefits.--The term ``claim for benefits'' means any request for coverage (including authorization of coverage), for eligibility, or for payment in whole or in part, for an item or service under a group health plan or health insurance coverage. (2) Denial of claim for benefits.--The term ``denial'' means, with respect to a claim for benefits, means a denial, or a failure to act on a timely basis upon, in whole or in part, the claim for benefits and includes a failure to provide benefits (including items and services) required to be provided under this title. SEC. 102. INTERNAL APPEALS PROCEDURES. (a) Right of Review.-- (1) In general.--Each group health plan, and each health insurance issuer offering health insurance coverage-- (A) shall provide adequate notice in writing to any participant or beneficiary under such plan, or enrollee under such coverage, whose claim for benefits under the plan or coverage has been denied (within the meaning of section 101(f)(2)), setting forth the specific reasons for such denial of claim for benefits and rights to any further review or appeal, written in a manner calculated to be understood by the participant, beneficiary, or enrollee; and (B) shall afford such a participant, beneficiary, or enrollee (and any provider or other person acting on behalf of such an individual with the individual's consent or without such consent if the individual is medically unable to provide such consent) who is dissatisfied with such a denial of claim for benefits a reasonable opportunity (of not less than 180 days) to request and obtain a full and fair review by a named fiduciary (with respect to such plan) or named appropriate [[Page H9525]] individual (with respect to such coverage) of the decision denying the claim. (2) Treatment of oral requests.--The request for review under paragraph (1)(B) may be made orally, but, in the case of an oral request, shall be followed by a request in writing. (b) Internal Review Process.-- (1) Conduct of review.-- (A) In general.--A review of a denial of claim under this section shall be made by an individual who-- (i) in a case involving medical judgment, shall be a physician or, in the case of limited scope coverage (as defined in subparagraph (B), shall be an appropriate specialist; (ii) has been selected by the plan or issuer; and (iii) did not make the initial denial in the internally appealable decision. (B) Limited scope coverage defined.--For purposes of subparagraph (A), the term ``limited scope coverage'' means a group health plan or health insurance coverage the only benefits under which are for benefits described in section 2791(c)(2)(A) of the Public Health Service Act (42 U.S.C. 300gg-91(c)(2)). (2) Time limits for internal reviews.-- (A) In general.--Having received such a request for review of a denial of claim, the plan or issuer shall, in accordance with the medical exigencies of the case but not later than the deadline specified in subparagraph (B), complete the review on the denial and transmit to the participant, beneficiary, enrollee, or other person involved a decision that affirms, reverses, or modifies the denial. If the decision does not reverse the denial, the plan or issuer shall transmit, in printed form, a notice that sets forth the grounds for such decision and that includes a description of rights to any further appeal. Such decision shall be treated as the final decision of the plan. Failure to issue such a decision by such deadline shall be treated as a final decision affirming the denial of claim. (B) Deadline.-- (i) In general.--Subject to clauses (ii) and (iii), the deadline specified in this subparagraph is 14 days after the date of receipt of the request for internal review. (ii) Extension permitted where notice of additional information required.--If a group health plan or health insurance issuer-- (I) receives a request for internal review, (II) determines that additional information is necessary to complete the review and make the determination on the request, and (III) notifies the requester, not later than five business days after the date of receiving the request, of the need for such specified additional information, the deadline specified in this subparagraph is 14 days after the date the plan or issuer receives the specified additional information, but in no case later than 28 days after the date of receipt of the request for the internal review. This clause shall not apply if the deadline is specified in clause (iii). (iii) Expedited cases.--In the case of a situation described in subsection (c)(1)(A), the deadline specified in this subparagraph is 72 hours after the time of the request for review. (c) Expedited Review Process.-- (1) In general.--A group health plan, and a health insurance issuer, shall establish procedures in writing for the expedited consideration of requests for review under subsection (b) in situations-- (A) in which the application of the normal timeframe for making a determination could seriously jeopardize the life or health of the participant, beneficiary, or enrollee or such an individual's ability to regain maximum function; or (B) described in section 101(d)(2) (relating to requests for continuation of ongoing care which would otherwise be reduced or terminated). (2) Process.--Under such procedures-- (A) the request for expedited review may be submitted orally or in writing by an individual or provider who is otherwise entitled to request the review; (B) all necessary information, including the plan's or issuer's decision, shall be transmitted between the plan or issuer and the requester by telephone, facsimile, or other similarly expeditious available method; and (C) the plan or issuer shall expedite the review in the case of any of the situations described in subparagraph (A) or (B) of paragraph (1). (3) Deadline for decision.--The decision on the expedited review must be made and communicated to the parties as soon as possible in accordance with the medical exigencies of the case, and in no event later than 72 hours after the time of receipt of the request for expedited review, except that in a case described in paragraph (1)(B), the decision must be made before the end of the approved period of care. (d) Waiver of Process.--A plan or issuer may waive its rights for an internal review under subsection (b). In such case the participant, beneficiary, or enrollee involved (and any designee or provider involved) shall be relieved of any obligation to complete the review involved and may, at the option of such participant, beneficiary, enrollee, designee, or provider, proceed directly to seek further appeal through any applicable external appeals process. SEC. 103. EXTERNAL APPEALS PROCEDURES. (a) Right to External Appeal.-- (1) In general.--A group health plan, and a health insurance issuer offering health insurance coverage, shall provide for an external appeals process that meets the requirements of this section in the case of an externally appealable decision described in paragraph (2), for which a timely appeal is made either by the plan or issuer or by the participant, beneficiary, or enrollee (and any provider or other person acting on behalf of such an individual with the individual's consent or without such consent if such an individual is medically unable to provide such consent). The appropriate Secretary shall establish standards to carry out such requirements. (2) Externally appealable decision defined.-- (A) In general.--For purposes of this section, the term ``externally appealable decision'' means a denial of claim for benefits (as defined in section 101(f)(2))-- (i) that is based in whole or in part on a decision that the item or service is not medically necessary or appropriate or is investigational or experimental; or (ii) in which the decision as to whether a benefit is covered involves a medical judgment. (B) Inclusion.--Such term also includes a failure to meet an applicable deadline for internal review under section 102. (C) Exclusions.--Such term does not include-- (i) specific exclusions or express limitations on the amount, duration, or scope of coverage that do not involve medical judgment; or (ii) a decision regarding whether an individual is a participant, beneficiary, or enrollee under the plan or coverage. (3) Exhaustion of internal review process.--Except as provided under section 102(d), a plan or issuer may condition the use of an external appeal process in the case of an externally appealable decision upon a final decision in an internal review under section 102, but only if the decision is made in a timely basis consistent with the deadlines provided under this subtitle. (4) Filing fee requirement.-- (A) In general.--Subject to subparagraph (B), a plan or issuer may condition the use of an external appeal process upon payment to the plan or issuer of a filing fee that does not exceed $25. (B) Exception for indigency.--The plan or issuer may not require payment of the filing fee in the case of an individual participant, beneficiary, or enrollee who certifies (in a form and manner specified in guidelines established by the Secretary of Health and Human Services) that the individual is indigent (as defined in such guidelines). (C) Refunding fee in case of successful appeals.--The plan or issuer shall refund payment of the filing fee under this paragraph if the recommendation of the external appeal entity is to reverse or modify the denial of a claim for benefits which is the subject of the appeal. (b) General Elements of External Appeals Process.-- (1) Contract with qualified external appeal entity.-- (A) Contract requirement.--Except as provided in subparagraph (D), the external appeal process under this section of a plan or issuer shall be conducted under a contract between the plan or issuer and one or more qualified external appeal entities (as defined in subsection (c)). (B) Limitation on plan or issuer selection.--The applicable authority shall implement procedures-- (i) to assure that the selection process among qualified external appeal entities will not create any incentives for external appeal entities to make a decision in a biased manner, and (ii) for auditing a sample of decisions by such entities to assure that no such decisions are made in a biased manner. (C) Other terms and conditions.--The terms and conditions of a contract under this paragraph shall be consistent with the standards the appropriate Secretary shall establish to assure there is no real or apparent conflict of interest in the conduct of external appeal activities. Such contract shall provide that all costs of the process (except those incurred by the participant, beneficiary, enrollee, or treating professional in support of the appeal) shall be paid by the plan or issuer, and not by the participant, beneficiary, or enrollee. The previous sentence shall not be construed as applying to the imposition of a filing fee under subsection (a)(4). (D) State authority with respect qualified external appeal entity for health insurance issuers.--With respect to health insurance issuers offering health insurance coverage in a State, the State may provide for external review activities to be conducted by a qualified external appeal entity that is designated by the State or that is selected by the State in a manner determined by the State to assure an unbiased determination. (2) Elements of process.--An external appeal process shall be conducted consistent with standards established by the appropriate Secretary that include at least the following: (A) Fair and de novo determination.--The process shall provide for a fair, de novo determination. However, nothing in this paragraph shall be construed as providing for coverage of items and services for which benefits are specifically excluded under the plan or coverage. (B) Standard of review.--An external appeal entity shall determine whether the [[Page H9526]] plan's or issuer's decision is in accordance with the medical needs of the patient involved (as determined by the entity) taking into account, as of the time of the entity's determination, the patient's medical condition and any relevant and reliable evidence the entity obtains under subparagraph (D). If the entity determines the decision is in accordance with such needs, the entity shall affirm the decision and to the extent that the entity determines the decision is not in accordance with such needs, the entity shall reverse or modify the decision. (C) Consideration of plan or coverage definitions.--In making such determination, the external appeal entity shall consider (but not be bound by) any language in the plan or coverage document relating to the definitions of the terms medical necessity, medically necessary or appropriate, or experimental, investigational, or related terms. (D) Evidence.-- (i) In general.--An external appeal entity shall include, among the evidence taken into consideration-- (I) the decision made by the plan or issuer upon internal review under section 102 and any guidelines or standards used by the plan or issuer in reaching such decision; (II) any personal health and medical information supplied with respect to the individual whose denial of claim for benefits has been appealed; and (III) the opinion of the individual's treating physician or health care professional. (ii) Additional evidence.--Such entity may also take into consideration but not be limited to the following evidence (to the extent available): (I) The results of studies that meet professionally recognized standards of validity and replicability or that have been published in peer-reviewed journals. (II) The results of professional consensus conferences conducted or financed in whole or in part by one or more Government agencies. (III) Practice and treatment guidelines prepared or financed in whole or in part by Government agencies. (IV) Government-issued coverage and treatment policies. (V) Community standard of care and generally accepted principles of professional medical practice. (VI) To the extent that the entity determines it to be free of any conflict of interest, the opinions of individuals who are qualified as experts in one or more fields of health care which are directly related to the matters under appeal. (VII) To the extent that the entity determines it to be free of any conflict of interest, the results of peer reviews conducted by the plan or issuer involved. (E) Determination concerning externally appealable decisions.--A qualified external appeal entity shall determine-- (i) whether a denial of claim for benefits is an externally appealable decision (within the meaning of subsection (a)(2)); (ii) whether an externally appealable decision involves an expedited appeal; and (iii) for purposes of initiating an external review, whether the internal review process has been completed. (F) Opportunity to submit evidence.--Each party to an externally appealable decision may submit evidence related to the issues in dispute. (G) Provision of information.--The plan or issuer involved shall provide timely access to the external appeal entity to information and to provisions of the plan or health insurance coverage relating to the matter of the externally appealable decision, as determined by the entity. (H) Timely decisions.--A determination by the external appeal entity on the decision shall-- (i) be made orally or in writing and, if it is made orally, shall be supplied to the parties in writing as soon as possible; (ii) be made in accordance with the medical exigencies of the case involved, but in no event later than 21 days after the date (or, in the case of an expedited appeal, 72 hours after the time) of requesting an external appeal of the decision; (iii) state, in layperson's language, the basis for the determination, including, if relevant, any basis in the terms or conditions of the plan or coverage; and (iv) inform the participant, beneficiary, or enrollee of the individual's rights (including any limitation on such rights) to seek further review by the courts (or other process) of the external appeal determination. (I) Compliance with determination.--If the external appeal entity reverses or modifies the denial of a claim for benefits, the plan or issuer shall-- (i) upon the receipt of the determination, authorize benefits in accordance with such determination; (ii) take such actions as may be necessary to provide benefits (including items or services) in a timely manner consistent with such determination; and (iii) submit information to the entity documenting compliance with the entity's determination and this subparagraph. (c) Qualifications of External Appeal Entities.-- (1) In general.--For purposes of this section, the term ``qualified external appeal entity'' means, in relation to a plan or issuer, an entity that is certified under paragraph (2) as meeting the following requirements: (A) The entity meets the independence requirements of paragraph (3). (B) The entity conducts external appeal activities through a panel of not fewer than three clinical peers. (C) The entity has sufficient medical, legal, and other expertise and sufficient staffing to conduct external appeal activities for the plan or issuer on a timely basis consistent with subsection (b)(2)(G). (D) The entity meets such other requirements as the appropriate Secretary may impose. (2) Initial certification of external appeal entities.-- (A) In general.--In order to be treated as a qualified external appeal entity with respect to-- (i) a group health plan, the entity must be certified (and, in accordance with subparagraph (B), periodically recertified) as meeting the requirements of paragraph (1)-- (I) by the Secretary of Labor; (II) under a process recognized or approved by the Secretary of Labor; or (III) to the extent provided in subparagraph (C)(i), by a qualified private standard-setting organization (certified under such subparagraph); or (ii) a health insurance issuer operating in a State, the entity must be certified (and, in accordance with subparagraph (B), periodically recertified) as meeting such requirements-- (I) by the applicable State authority (or under a process recognized or approved by such authority); or (II) if the State has not established a certification and recertification process for such entities, by the Secretary of Health and Human Services, under a process recognized or approved by such Secretary, or to the extent provided in subparagraph (C)(ii), by a qualified private standard-setting organization (certified under such subparagraph). (B) Recertification process.--The appropriate Secretary shall develop standards for the recertification of external appeal entities. Such standards shall include a review of-- (i) the number of cases reviewed; (ii) a summary of the disposition of those cases; (iii) the length of time in making determinations on those cases; (iv) updated information of what was required to be submitted as a condition of certification for the entity's performance of external appeal activities; and (v) such information as may be necessary to assure the independence of the entity from the plans or issuers for which external appeal activities are being conducted. (C) Certification of qualified private standard-setting organizations.-- (i) For external reviews under group health plans.--For purposes of subparagraph (A)(i)(III), the Secretary of Labor may provide for a process for certification (and periodic recertification) of qualified private standard-setting organizations which provide for certification of external review entities. Such an organization shall only be certified if the organization does not certify an external review entity unless it meets standards required for certification of such an entity by such Secretary under subparagraph (A)(i)(I). (ii) For external reviews of health insurance issuers.--For purposes of subparagraph (A)(ii)(II), the Secretary of Health and Human Services may provide for a process for certification (and periodic recertification) of qualified private standard-setting organizations which provide for certification of external review entities. Such an organization shall only be certified if the organization does not certify an external review entity unless it meets standards required for certification of such an entity by such Secretary under subparagraph (A)(ii)(II). (3) Independence requirements.-- (A) In general.--A clinical peer or other entity meets the independence requirements of this paragraph if-- (i) the peer or entity does not have a familial, financial, or professional relationship with any related party; (ii) any compensation received by such peer or entity in connection with the external review is reasonable and not contingent on any decision rendered by the peer or entity; (iii) except as provided in paragraph (4), the plan and the issuer have no recourse against the peer or entity in connection with the external review; and (iv) the peer or entity does not otherwise have a conflict of interest with a related party as determined under any regulations which the Secretary may prescribe. (B) Related party.--For purposes of this paragraph, the term ``related party'' means-- (i) with respect to-- (I) a group health plan or health insurance coverage offered in connection with such a plan, the plan or the health insurance issuer offering such coverage, or (II) individual health insurance coverage, the health insurance issuer offering such coverage, or any plan sponsor, fiduciary, officer, director, or management employee of such plan or issuer; (ii) the health care professional that provided the health care involved in the coverage decision; (iii) the institution at which the health care involved in the coverage decision is provided; (iv) the manufacturer of any drug or other item that was included in the health care involved in the coverage decision; or [[Page H9527]] (v) any other party determined under any regulations which the Secretary may prescribe to have a substantial interest in the coverage decision. (4) Limitation on liability of reviewers.--No qualified external appeal entity having a contract with a plan or issuer under this part and no person who is employed by any such entity or who furnishes professional services to such entity, shall be held by reason of the performance of any duty, function, or activity required or authorized pursuant to this section, to have violated any criminal law, or to be civilly liable under any law of the United States or of any State (or political subdivision thereof) if due care was exercised in the performance of such duty, function, or activity and there was no actual malice or gross misconduct in the performance of such duty, function, or activity. (d) External Appeal Determination Binding on Plan.--The determination by an external appeal entity under this section is binding on the plan and issuer involved in the determination. (e) Penalties Against Authorized Officials for Refusing to Authorize the Determination of an External Review Entity.-- (1) Monetary penalties.--In any case in which the determination of an external review entity is not followed by a group health plan, or by a health insurance issuer offering health insurance coverage, any person who, acting in the capacity of authorizing the benefit, causes such refusal may, in the discretion in a court of competent jurisdiction, be liable to an aggrieved participant, beneficiary, or enrollee for a civil penalty in an amount of up to $1,000 a day from the date on which the determination was transmitted to the plan or issuer by the external review entity until the date the refusal to provide the benefit is corrected. (2) Cease and desist order and order of attorney's fees.-- In any action described in paragraph (1) brought by a participant, beneficiary, or enrollee with respect to a group health plan, or a health insurance issuer offering health insurance coverage, in which a plaintiff alleges that a person referred to in such paragraph has taken an action resulting in a refusal of a benefit determined by an external appeal entity in violation of such terms of the plan, coverage, or this subtitle, or has failed to take an action for which such person is responsible under the plan, coverage, or this title and which is necessary under the plan or coverage for authorizing a benefit, the court shall cause to be served on the defendant an order requiring the defendant-- (A) to cease and desist from the alleged action or failure to act; and (B) to pay to the plaintiff a reasonable attorney's fee and other reasonable costs relating to the prosecution of the action on the charges on which the plaintiff prevails. (3) Additional civil penalties.-- (A) In general.--In addition to any penalty imposed under paragraph (1) or (2), the appropriate Secretary may assess a civil penalty against a person acting in the capacity of authorizing a benefit determined by an external review entity for one or more group health plans, or health insurance issuers offering health insurance coverage, for-- (i) any pattern or practice of repeated refusal to authorize a benefit determined by an external appeal entity in violation of the terms of such a plan, coverage, or this title; or (ii) any pattern or practice of repeated violations of the requirements of this section with respect to such plan or plans or coverage. (B) Standard of proof and amount of penalty.--Such penalty shall be payable only upon proof by clear and convincing evidence of such pattern or practice and shall be in an amount not to exceed the lesser of-- (i) 25 percent of the aggregate value of benefits shown by the appropriate Secretary to have not been provided, or unlawfully delayed, in violation of this section under such pattern or practice, or (ii) $500,000. (4) Removal and disqualification.--Any person acting in the capacity of authorizing benefits who has engaged in any such pattern or practice described in paragraph (3)(A) with respect to a plan or coverage, upon the petition of the appropriate Secretary, may be removed by the court from such position, and from any other involvement, with respect to such a plan or coverage, and may be precluded from returning to any such position or involvement for a period determined by the court. (f) Protection of Legal Rights.--Nothing in this subtitle shall be construed as altering or eliminating any cause of action or legal rights or remedies of participants, beneficiaries, enrollees, and others under State or Federal law (including sections 502 and 503 of the Employee Retirement Income Security Act of 1974), including the right to file judicial actions to enforce rights. SEC. 104. ESTABLISHMENT OF A GRIEVANCE PROCESS. (a) Establishment of Grievance System.-- (1) In general.--A group health plan, and a health insurance issuer in connection with the provision of health insurance coverage, shall establish and maintain a system to provide for the presentation and resolution of oral and written grievances brought by individuals who are participants, beneficiaries, or enrollees, or health care providers or other individuals acting on behalf of an individual and with the individual's consent or without such consent if the individual is medically unable to provide such consent, regarding any aspect of the plan's or issuer's services. (2) Grievance defined.--In this section, the term ``grievance'' means any question, complaint, or concern brought by a participant, beneficiary or enrollee that is not a claim for benefits (as defined in section 101(f)(1)). (b) Grievance System.--Such system shall include the following components with respect to individuals who are participants, beneficiaries, or enrollees: (1) Written notification to all such individuals and providers of the telephone numbers and business addresses of the plan or issuer personnel responsible for resolution of grievances and appeals. (2) A system to record and document, over a period of at least three previous years, all grievances and appeals made and their status. (3) A process providing for timely processing and resolution of grievances. (4) Procedures for follow-up action, including the methods to inform the person making the grievance of the resolution of the grievance. Grievances are not subject to appeal under the previous provisions of this subtitle. Subtitle B--Access to Care SEC. 111. CONSUMER CHOICE OPTION. (a) In General.--If a health insurance issuer offers to enrollees health insurance coverage in connection with a group health plan which provides for coverage of services only if such services are furnished through health care professionals and providers who are members of a network of health care professionals and providers who have entered into a contract with the issuer to provide such services, the issuer shall also offer or arrange to be offered to such enrollees (at the time of enrollment and during an annual open season as provided under subsection (c)) the option of health insurance coverage which provides for coverage of such services which are not furnished through health care professionals and providers who are members of such a network unless enrollees are offered such non-network coverage through another group health plan or through another health insurance issuer in the group market. (b) Additional Costs.--The amount of any additional premium charged by the health insurance issuer for the additional cost of the creation and maintenance of the option described in subsection (a) and the amount of any additional cost sharing imposed under such option shall be borne by the enrollee unless it is paid by the health plan sponsor through agreement with the health insurance issuer. (c) Open Season.--An enrollee may change to the offering provided under this section only during a time period determined by the health insurance issuer. Such time period shall occur at least annually. SEC. 112. CHOICE OF HEALTH CARE PROFESSIONAL. (a) Primary Care.--If a group health plan, or a health insurance issuer that offers health insurance coverage, requires or provides for designation by a participant, beneficiary, or enrollee of a participating primary care provider, then the plan or issuer shall permit each participant, beneficiary, and enrollee to designate any participating primary care provider who is available to accept such individual. (b) Specialists.-- (1) In general.--Subject to paragraph (2), a group health plan and a health insurance issuer that offers health insurance coverage shall permit each participant, beneficiary, or enrollee to receive medically necessary or appropriate specialty care, pursuant to appropriate referral procedures, from any qualified participating health care professional who is available to accept such individual for such care. (2) Limitation.--Paragraph (1) shall not apply to specialty care if the plan or issuer clearly informs participants, beneficiaries, and enrollees of the limitations on choice of participating health care professionals with respect to such care. (3) Construction.--Nothing in this subsection shall be construed as affecting the application of section 114 (relating to access to specialty care). SEC. 113. ACCESS TO EMERGENCY CARE. (a) Coverage of Emergency Services.-- (1) In general.--If a group health plan, or health insurance coverage offered by a health insurance issuer, provides any benefits with respect to services in an emergency department of a hospital, the plan or issuer shall cover emergency services (as defined in paragraph (2)(B))-- (A) without the need for any prior authorization determination; (B) whether or not the health care provider furnishing such services is a participating provider with respect to such services; (C) in a manner so that, if such services are provided to a participant, beneficiary, or enrollee-- (i) by a nonparticipating health care provider with or without prior authorization, or (ii) by a participating health care provider without prior authorization, the participant, beneficiary, or enrollee is not liable for amounts that exceed the amounts of liability that would be incurred if the services were provided by a participating health care provider with prior authorization; and [[Page H9528]] (D) without regard to any other term or condition of such coverage (other than exclusion or coordination of benefits, or an affiliation or waiting period, permitted under section 2701 of the Public Health Service Act, section 701 of the Employee Retirement Income Security Act of 1974, or section 9801 of the Internal Revenue Code of 1986, and other than applicable cost-sharing). (2) Definitions.--In this section: (A) Emergency medical condition based on prudent layperson standard.--The term ``emergency medical condition'' means a medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain) such that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect the absence of immediate medical attention to result in a condition described in clause (i), (ii), or (iii) of section 1867(e)(1)(A) of the Social Security Act. (B) Emergency services.--The term ``emergency services'' means-- (i) a medical screening examination (as required under section 1867 of the Social Security Act) that is within the capability of the emergency department of a hospital, including ancillary services routinely available to the emergency department to evaluate an emergency medical condition (as defined in subparagraph (A)), and (ii) within the capabilities of the staff and facilities available at the hospital, such further medical examination and treatment as are required under section 1867 of such Act to stabilize the patient. (C) Stabilize.--The term ``to stabilize'' means, with respect to an emergency medical condition, to provide such medical treatment of the condition as may be necessary to assure, within reasonable medical probability, that no material deterioration of the condition is likely to result from or occur during the transfer of the individual from a facility. (b) Reimbursement for Maintenance Care and Post- Stabilization Care.--In the case of services (other than emergency services) for which benefits are available under a group health plan, or under health insurance coverage offered by a health insurance issuer, the plan or issuer shall provide for reimbursement with respect to such services provided to a participant, beneficiary, or enrollee other than through a participating health care provider in a manner consistent with subsection (a)(1)(C) (and shall otherwise comply with the guidelines established under section 1852(d)(2) of the Social Security Act), if the services are maintenance care or post-stabilization care covered under such guidelines. SEC. 114. ACCESS TO SPECIALTY CARE. (a) Specialty Care for Covered Services.-- (1) In general.--If-- (A) an individual is a participant or beneficiary under a group health plan or an enrollee who is covered under health insurance coverage offered by a health insurance issuer, (B) the individual has a condition or disease of sufficient seriousness and complexity to require treatment by a specialist, and (C) benefits for such treatment are provided under the plan or coverage, the plan or issuer shall make or provide for a referral to a specialist who is available and accessible to provide the treatment for such condition or disease. (2) Specialist defined.--For purposes of this subsection, the term ``specialist'' means, with respect to a condition, a health care practitioner, facility, or center that has adequate expertise through appropriate training and experience (including, in the case of a child, appropriate pediatric expertise) to provide high quality care in treating the condition. (3) Care under referral.--A group health plan or health insurance issuer may require that the care provided to an individual pursuant to such referral under paragraph (1) be-- (A) pursuant to a treatment plan, only if the treatment plan is developed by the specialist and approved by the plan or issuer, in consultation with the designated primary care provider or specialist and the individual (or the individual's designee), and (B) in accordance with applicable quality assurance and utilization review standards of the plan or issuer. Nothing in this subsection shall be construed as preventing such a treatment plan for an individual from requiring a specialist to provide the primary care provider with regular updates on the specialty care provided, as well as all necessary medical information. (4) Referrals to participating providers.--A group health plan or health insurance issuer is not required under paragraph (1) to provide for a referral to a specialist that is not a participating provider, unless the plan or issuer does not have an appropriate specialist that is available and accessible to treat the individual's condition and that is a participating provider with respect to such treatment. (5) Treatment of nonparticipating providers.--If a plan or issuer refers an individual to a nonparticipating specialist pursuant to paragraph (1), services provided pursuant to the approved treatment plan (if any) shall be provided at no additional cost to the individual beyond what the individual would otherwise pay for services received by such a specialist that is a participating provider. (b) Specialists as Gatekeeper for Treatment of Ongoing Special Conditions.-- (1) In general.--A group health plan, or a health insurance issuer, in connection with the provision of health insurance coverage, shall have a procedure by which an individual who is a participant, beneficiary, or enrollee and who has an ongoing special condition (as defined in paragraph (3)) may request and receive a referral to a specialist for such condition who shall be responsible for and capable of providing and coordinating the individual's care with respect to the condition. Under such procedures if such an individual's care would most appropriately be coordinated by such a specialist, such plan or issuer shall refer the individual to such specialist. (2) Treatment for related referrals.--Such specialists shall be permitted to treat the individual without a referral from the individual's primary care provider and may authorize such referrals, procedures, tests, and other medical services as the individual's primary care provider would otherwise be permitted to provide or authorize, subject to the terms of the treatment (referred to in subsection (a)(3)(A)) with respect to the ongoing special condition. (3) Ongoing special condition defined.--In this subsection, the term ``ongoing special condition'' means a condition or disease that-- (A) is life-threatening, degenerative, or disabling, and (B) requires specialized medical care over a prolonged period of time. (4) Terms of referral.--The provisions of paragraphs (3) through (5) of subsection (a) apply with respect to referrals under paragraph (1) of this subsection in the same manner as they apply to referrals under subsection (a)(1). (c) Standing Referrals.-- (1) In general.--A group health plan, and a health insurance issuer in connection with the provision of health insurance coverage, shall have a procedure by which an individual who is a participant, beneficiary, or enrollee and who has a condition that requires ongoing care from a specialist may receive a standing referral to such specialist for treatment of such condition. If the plan or issuer, or if the primary care provider in consultation with the medical director of the plan or issuer and the specialist (if any), determines that such a standing referral is appropriate, the plan or issuer shall make such a referral to such a specialist if the individual so desires. (2) Terms of referral.--The provisions of paragraphs (3) through (5) of subsection (a) apply with respect to referrals under paragraph (1) of this subsection in the same manner as they apply to referrals under subsection (a)(1). SEC. 115. ACCESS TO OBSTETRICAL AND GYNECOLOGICAL CARE. (a) In General.--If a group health plan, or a health insurance issuer in connection with the provision of health insurance coverage, requires or provides for a participant, beneficiary, or enrollee to designate a participating primary care health care professional, the plan or issuer-- (1) may not require authorization or a referral by the individual's primary care health care professional or otherwise for coverage of gynecological care (including preventive women's health examinations) and pregnancy-related services provided by a participating health care professional, including a physician, who specializes in obstetrics and gynecology to the extent such care is otherwise covered, and (2) shall treat the ordering of other obstetrical or gynecological care by such a participating professional as the authorization of the primary care health care professional with respect to such care under the plan or coverage. (b) Construction.--Nothing in subsection (a) shall be construed to-- (1) waive any exclusions of coverage under the terms of the plan or health insurance coverage with respect to coverage of obstetrical or gynecological care; or (2) preclude the group health plan or health insurance issuer involved from requiring that the obstetrical or gynecological provider notify the primary care health care professional or the plan or issuer of treatment decisions. SEC. 116. ACCESS TO PEDIATRIC CARE. (a) Pediatric Care.--If a group health plan, or a health insurance issuer in connection with the provision of health insurance coverage, requires or provides for an enrollee to designate a participating primary care provider for a child of such enrollee, the plan or issuer shall permit the enrollee to designate a physician who specializes in pediatrics as the child's primary care provider. (b) Construction.--Nothing in subsection (a) shall be construed to waive any exclusions of coverage under the terms of the plan or health insurance coverage with respect to coverage of pediatric care. SEC. 117. CONTINUITY OF CARE. (a) In General.-- (1) Termination of provider.--If a contract between a group health plan, or a health insurance issuer in connection with the provision of health insurance coverage, and a health care provider is terminated (as defined in paragraph (3)(B)), or benefits or coverage provided by a health care provider are terminated because of a change in the terms of provider participation in a group health plan, and an individual who is a participant, beneficiary, or enrollee in the plan or coverage is undergoing treatment from the provider for an ongoing special condition [[Page H9529]] (as defined in paragraph (3)(A)) at the time of such termination, the plan or issuer shall-- (A) notify the individual on a timely basis of such termination and of the right to elect continuation of coverage of treatment by the provider under thi

Summary:

All articles in House section

BIPARTISAN CONSENSUS MANAGED CARE IMPROVEMENT ACT OF 1999
(House of Representatives - October 07, 1999)

Text of this article available as: TXT PDF [Pages H9523-H9636] BIPARTISAN CONSENSUS MANAGED CARE IMPROVEMENT ACT OF 1999 The SPEAKER pro tempore (Mrs. Biggert). Pursuant to House Resolution 323 and rule XXVIII, the Chair declares the House in the Committee of the Whole House on the State of the Union for the further consideration of the bill, H.R. 2723. {time} 1107 In the Committee of the Whole Accordingly, the House resolved itself into the Committee of the Whole House on the State of the Union for the further consideration of the bill (H.R. 2723) to amend Title I of the Employee Retirement Income Security Act of 1974, title XXVII of the Public Health Service Act, and the Internal Revenue Code of 1986 to protect consumers in managed care plans and other health coverage, with Mr. Hastings of Washington in the chair. The Clerk read the title of the bill. The CHAIRMAN. When the Committee of the Whole rose on Wednesday, October 6, 1999, all time for general debate had expired. Pursuant to the rule, the amendments printed in part A of House Report 106-366 are adopted and the bill, as amended, is considered read for amendment under the 5-minute rule. The text of H.R. 2723, as amended, is as follows: H.R. 2723 Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE; TABLE OF CONTENTS. (a) Short Title.--This Act may be cited as the ``Bipartisan Consensus Managed Care Improvement Act of 1999''. (b) Table of Contents.--The table of contents of this Act is as follows: Sec. 1. Short title; table of contents. TITLE I--IMPROVING MANAGED CARE Subtitle A--Grievances and Appeals Sec. 101. Utilization review activities. Sec. 102. Internal appeals procedures. Sec. 103. External appeals procedures. Sec. 104. Establishment of a grievance process. Subtitle B--Access to Care Sec. 111. Consumer choice option. Sec. 112. Choice of health care professional. Sec. 113. Access to emergency care. Sec. 114. Access to specialty care. Sec. 115. Access to obstetrical and gynecological care. Sec. 116. Access to pediatric care. Sec. 117. Continuity of care. Sec. 118. Access to needed prescription drugs. Sec. 119. Coverage for individuals participating in approved clinical trials. Subtitle C--Access to Information Sec. 121. Patient access to information. Subtitle D--Protecting the Doctor-Patient Relationship Sec. 131. Prohibition of interference with certain medical communications. Sec. 132. Prohibition of discrimination against providers based on licensure. Sec. 133. Prohibition against improper incentive arrangements. Sec. 134. Payment of claims. Sec. 135. Protection for patient advocacy. Subtitle E--Definitions Sec. 151. Definitions. Sec. 152. Preemption; State flexibility; construction. Sec. 153. Exclusions. Sec. 154. Coverage of limited scope plans. Sec. 155. Regulations. TITLE II--APPLICATION OF QUALITY CARE STANDARDS TO GROUP HEALTH PLANS AND HEALTH INSURANCE COVERAGE UNDER THE PUBLIC HEALTH SERVICE ACT Sec. 201. Application to group health plans and group health insurance coverage. Sec. 202. Application to individual health insurance coverage. TITLE III--AMENDMENTS TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974 Sec. 301. Application of patient protection standards to group health plans and group health insurance coverage under the Employee Retirement Income Security Act of 1974. Sec. 302. ERISA preemption not to apply to certain actions involving health insurance policyholders. TITLE IV--APPLICATION TO GROUP HEALTH PLANS UNDER THE INTERNAL REVENUE CODE OF 1986 Sec. 401. Amendments to the Internal Revenue Code of 1986. TITLE V--EFFECTIVE DATES; COORDINATION IN IMPLEMENTATION Sec. 501. Effective dates. Sec. 502. Coordination in implementation. TITLE VI--HEALTH CARE PAPERWORK SIMPLIFICATION Sec. 601. Health care paperwork simplification. TITLE I--IMPROVING MANAGED CARE Subtitle A--Grievance and Appeals SEC. 101. UTILIZATION REVIEW ACTIVITIES. (a) Compliance With Requirements.-- (1) In general.--A group health plan, and a health insurance issuer that provides health insurance coverage, shall conduct utilization review activities in connection with the provision of benefits under such plan or coverage only in accordance with a utilization review program that meets the requirements of this section. (2) Use of outside agents.--Nothing in this section shall be construed as preventing a group health plan or health insurance issuer from arranging through a contract or otherwise for persons or entities to conduct utilization review activities on behalf of the plan or issuer, so long as such activities are conducted in accordance with a utilization review program that meets the requirements of this section. (3) Utilization review defined.--For purposes of this section, the terms ``utilization [[Page H9524]] review'' and ``utilization review activities'' mean procedures used to monitor or evaluate the use or coverage, clinical necessity, appropriateness, efficacy, or efficiency of health care services, procedures or settings, and includes prospective review, concurrent review, second opinions, case management, discharge planning, or retrospective review. (b) Written Policies and Criteria.-- (1) Written policies.--A utilization review program shall be conducted consistent with written policies and procedures that govern all aspects of the program. (2) Use of written criteria.-- (A) In general.--Such a program shall utilize written clinical review criteria developed with input from a range of appropriate actively practicing health care professionals, as determined by the plan, pursuant to the program. Such criteria shall include written clinical review criteria that are based on valid clinical evidence where available and that are directed specifically at meeting the needs of at-risk populations and covered individuals with chronic conditions or severe illnesses, including gender-specific criteria and pediatric-specific criteria where available and appropriate. (B) Continuing use of standards in retrospective review.-- If a health care service has been specifically pre-authorized or approved for an enrollee under such a program, the program shall not, pursuant to retrospective review, revise or modify the specific standards, criteria, or procedures used for the utilization review for procedures, treatment, and services delivered to the enrollee during the same course of treatment. (C) Review of sample of claims denials.--Such a program shall provide for an evaluation of the clinical appropriateness of at least a sample of denials of claims for benefits. (c) Conduct of Program Activities.-- (1) Administration by health care professionals.--A utilization review program shall be administered by qualified health care professionals who shall oversee review decisions. (2) Use of qualified, independent personnel.-- (A) In general.--A utilization review program shall provide for the conduct of utilization review activities only through personnel who are qualified and have received appropriate training in the conduct of such activities under the program. (B) Prohibition of contingent compensation arrangements.-- Such a program shall not, with respect to utilization review activities, permit or provide compensation or anything of value to its employees, agents, or contractors in a manner that encourages denials of claims for benefits. (C) Prohibition of conflicts.--Such a program shall not permit a health care professional who is providing health care services to an individual to perform utilization review activities in connection with the health care services being provided to the individual. (3) Accessibility of review.--Such a program shall provide that appropriate personnel performing utilization review activities under the program, including the utilization review administrator, are reasonably accessible by toll-free telephone during normal business hours to discuss patient care and allow response to telephone requests, and that appropriate provision is made to receive and respond promptly to calls received during other hours. (4) Limits on frequency.--Such a program shall not provide for the performance of utilization review activities with respect to a class of services furnished to an individual more frequently than is reasonably required to assess whether the services under review are medically necessary or appropriate. (d) Deadline for Determinations.-- (1) Prior authorization services.-- (A) In general.--Except as provided in paragraph (2), in the case of a utilization review activity involving the prior authorization of health care items and services for an individual, the utilization review program shall make a determination concerning such authorization, and provide notice of the determination to the individual or the individual's designee and the individual's health care provider by telephone and in printed form, as soon as possible in accordance with the medical exigencies of the case, and in no event later than the deadline specified in subparagraph (B). (B) Deadline.-- (i) In general.--Subject to clauses (ii) and (iii), the deadline specified in this subparagraph is 14 days after the date of receipt of the request for prior authorization. (ii) Extension permitted where notice of additional information required.--If a utilization review program-- (I) receives a request for a prior authorization, (II) determines that additional information is necessary to complete the review and make the determination on the request, and (III) notifies the requester, not later than five business days after the date of receiving the request, of the need for such specified additional information, the deadline specified in this subparagraph is 14 days after the date the program receives the specified additional information, but in no case later than 28 days after the date of receipt of the request for the prior authorization. This clause shall not apply if the deadline is specified in clause (iii). (iii) Expedited cases.--In the case of a situation described in section 102(c)(1)(A), the deadline specified in this subparagraph is 72 hours after the time of the request for prior authorization. (2) Ongoing care.-- (A) Concurrent review.-- (i) In general.--Subject to subparagraph (B), in the case of a concurrent review of ongoing care (including hospitalization), which results in a termination or reduction of such care, the plan must provide by telephone and in printed form notice of the concurrent review determination to the individual or the individual's designee and the individual's health care provider as soon as possible in accordance with the medical exigencies of the case, with sufficient time prior to the termination or reduction to allow for an appeal under section 102(c)(1)(A) to be completed before the termination or reduction takes effect. (ii) Contents of notice.--Such notice shall include, with respect to ongoing health care items and services, the number of ongoing services approved, the new total of approved services, the date of onset of services, and the next review date, if any, as well as a statement of the individual's rights to further appeal. (B) Exception.--Subparagraph (A) shall not be interpreted as requiring plans or issuers to provide coverage of care that would exceed the coverage limitations for such care. (3) Previously provided services.--In the case of a utilization review activity involving retrospective review of health care services previously provided for an individual, the utilization review program shall make a determination concerning such services, and provide notice of the determination to the individual or the individual's designee and the individual's health care provider by telephone and in printed form, within 30 days of the date of receipt of information that is reasonably necessary to make such determination, but in no case later than 60 days after the date of receipt of the claim for benefits. (4) Failure to meet deadline.--In a case in which a group health plan or health insurance issuer fails to make a determination on a claim for benefit under paragraph (1), (2)(A), or (3) by the applicable deadline established under the respective paragraph, the failure shall be treated under this subtitle as a denial of the claim as of the date of the deadline. (5) Reference to special rules for emergency services, maintenance care, and post-stabilization care.--For waiver of prior authorization requirements in certain cases involving emergency services and maintenance care and post- stabilization care, see subsections (a)(1) and (b) of section 113, respectively. (e) Notice of Denials of Claims for Benefits.-- (1) In general.--Notice of a denial of claims for benefits under a utilization review program shall be provided in printed form and written in a manner calculated to be understood by the participant, beneficiary, or enrollee and shall include-- (A) the reasons for the denial (including the clinical rationale); (B) instructions on how to initiate an appeal under section 102; and (C) notice of the availability, upon request of the individual (or the individual's designee) of the clinical review criteria relied upon to make such denial. (2) Specification of any additional information.--Such a notice shall also specify what (if any) additional necessary information must be provided to, or obtained by, the person making the denial in order to make a decision on such an appeal. (f) Claim for Benefits and Denial of Claim for Benefits Defined.--For purposes of this subtitle: (1) Claim for benefits.--The term ``claim for benefits'' means any request for coverage (including authorization of coverage), for eligibility, or for payment in whole or in part, for an item or service under a group health plan or health insurance coverage. (2) Denial of claim for benefits.--The term ``denial'' means, with respect to a claim for benefits, means a denial, or a failure to act on a timely basis upon, in whole or in part, the claim for benefits and includes a failure to provide benefits (including items and services) required to be provided under this title. SEC. 102. INTERNAL APPEALS PROCEDURES. (a) Right of Review.-- (1) In general.--Each group health plan, and each health insurance issuer offering health insurance coverage-- (A) shall provide adequate notice in writing to any participant or beneficiary under such plan, or enrollee under such coverage, whose claim for benefits under the plan or coverage has been denied (within the meaning of section 101(f)(2)), setting forth the specific reasons for such denial of claim for benefits and rights to any further review or appeal, written in a manner calculated to be understood by the participant, beneficiary, or enrollee; and (B) shall afford such a participant, beneficiary, or enrollee (and any provider or other person acting on behalf of such an individual with the individual's consent or without such consent if the individual is medically unable to provide such consent) who is dissatisfied with such a denial of claim for benefits a reasonable opportunity (of not less than 180 days) to request and obtain a full and fair review by a named fiduciary (with respect to such plan) or named appropriate [[Page H9525]] individual (with respect to such coverage) of the decision denying the claim. (2) Treatment of oral requests.--The request for review under paragraph (1)(B) may be made orally, but, in the case of an oral request, shall be followed by a request in writing. (b) Internal Review Process.-- (1) Conduct of review.-- (A) In general.--A review of a denial of claim under this section shall be made by an individual who-- (i) in a case involving medical judgment, shall be a physician or, in the case of limited scope coverage (as defined in subparagraph (B), shall be an appropriate specialist; (ii) has been selected by the plan or issuer; and (iii) did not make the initial denial in the internally appealable decision. (B) Limited scope coverage defined.--For purposes of subparagraph (A), the term ``limited scope coverage'' means a group health plan or health insurance coverage the only benefits under which are for benefits described in section 2791(c)(2)(A) of the Public Health Service Act (42 U.S.C. 300gg-91(c)(2)). (2) Time limits for internal reviews.-- (A) In general.--Having received such a request for review of a denial of claim, the plan or issuer shall, in accordance with the medical exigencies of the case but not later than the deadline specified in subparagraph (B), complete the review on the denial and transmit to the participant, beneficiary, enrollee, or other person involved a decision that affirms, reverses, or modifies the denial. If the decision does not reverse the denial, the plan or issuer shall transmit, in printed form, a notice that sets forth the grounds for such decision and that includes a description of rights to any further appeal. Such decision shall be treated as the final decision of the plan. Failure to issue such a decision by such deadline shall be treated as a final decision affirming the denial of claim. (B) Deadline.-- (i) In general.--Subject to clauses (ii) and (iii), the deadline specified in this subparagraph is 14 days after the date of receipt of the request for internal review. (ii) Extension permitted where notice of additional information required.--If a group health plan or health insurance issuer-- (I) receives a request for internal review, (II) determines that additional information is necessary to complete the review and make the determination on the request, and (III) notifies the requester, not later than five business days after the date of receiving the request, of the need for such specified additional information, the deadline specified in this subparagraph is 14 days after the date the plan or issuer receives the specified additional information, but in no case later than 28 days after the date of receipt of the request for the internal review. This clause shall not apply if the deadline is specified in clause (iii). (iii) Expedited cases.--In the case of a situation described in subsection (c)(1)(A), the deadline specified in this subparagraph is 72 hours after the time of the request for review. (c) Expedited Review Process.-- (1) In general.--A group health plan, and a health insurance issuer, shall establish procedures in writing for the expedited consideration of requests for review under subsection (b) in situations-- (A) in which the application of the normal timeframe for making a determination could seriously jeopardize the life or health of the participant, beneficiary, or enrollee or such an individual's ability to regain maximum function; or (B) described in section 101(d)(2) (relating to requests for continuation of ongoing care which would otherwise be reduced or terminated). (2) Process.--Under such procedures-- (A) the request for expedited review may be submitted orally or in writing by an individual or provider who is otherwise entitled to request the review; (B) all necessary information, including the plan's or issuer's decision, shall be transmitted between the plan or issuer and the requester by telephone, facsimile, or other similarly expeditious available method; and (C) the plan or issuer shall expedite the review in the case of any of the situations described in subparagraph (A) or (B) of paragraph (1). (3) Deadline for decision.--The decision on the expedited review must be made and communicated to the parties as soon as possible in accordance with the medical exigencies of the case, and in no event later than 72 hours after the time of receipt of the request for expedited review, except that in a case described in paragraph (1)(B), the decision must be made before the end of the approved period of care. (d) Waiver of Process.--A plan or issuer may waive its rights for an internal review under subsection (b). In such case the participant, beneficiary, or enrollee involved (and any designee or provider involved) shall be relieved of any obligation to complete the review involved and may, at the option of such participant, beneficiary, enrollee, designee, or provider, proceed directly to seek further appeal through any applicable external appeals process. SEC. 103. EXTERNAL APPEALS PROCEDURES. (a) Right to External Appeal.-- (1) In general.--A group health plan, and a health insurance issuer offering health insurance coverage, shall provide for an external appeals process that meets the requirements of this section in the case of an externally appealable decision described in paragraph (2), for which a timely appeal is made either by the plan or issuer or by the participant, beneficiary, or enrollee (and any provider or other person acting on behalf of such an individual with the individual's consent or without such consent if such an individual is medically unable to provide such consent). The appropriate Secretary shall establish standards to carry out such requirements. (2) Externally appealable decision defined.-- (A) In general.--For purposes of this section, the term ``externally appealable decision'' means a denial of claim for benefits (as defined in section 101(f)(2))-- (i) that is based in whole or in part on a decision that the item or service is not medically necessary or appropriate or is investigational or experimental; or (ii) in which the decision as to whether a benefit is covered involves a medical judgment. (B) Inclusion.--Such term also includes a failure to meet an applicable deadline for internal review under section 102. (C) Exclusions.--Such term does not include-- (i) specific exclusions or express limitations on the amount, duration, or scope of coverage that do not involve medical judgment; or (ii) a decision regarding whether an individual is a participant, beneficiary, or enrollee under the plan or coverage. (3) Exhaustion of internal review process.--Except as provided under section 102(d), a plan or issuer may condition the use of an external appeal process in the case of an externally appealable decision upon a final decision in an internal review under section 102, but only if the decision is made in a timely basis consistent with the deadlines provided under this subtitle. (4) Filing fee requirement.-- (A) In general.--Subject to subparagraph (B), a plan or issuer may condition the use of an external appeal process upon payment to the plan or issuer of a filing fee that does not exceed $25. (B) Exception for indigency.--The plan or issuer may not require payment of the filing fee in the case of an individual participant, beneficiary, or enrollee who certifies (in a form and manner specified in guidelines established by the Secretary of Health and Human Services) that the individual is indigent (as defined in such guidelines). (C) Refunding fee in case of successful appeals.--The plan or issuer shall refund payment of the filing fee under this paragraph if the recommendation of the external appeal entity is to reverse or modify the denial of a claim for benefits which is the subject of the appeal. (b) General Elements of External Appeals Process.-- (1) Contract with qualified external appeal entity.-- (A) Contract requirement.--Except as provided in subparagraph (D), the external appeal process under this section of a plan or issuer shall be conducted under a contract between the plan or issuer and one or more qualified external appeal entities (as defined in subsection (c)). (B) Limitation on plan or issuer selection.--The applicable authority shall implement procedures-- (i) to assure that the selection process among qualified external appeal entities will not create any incentives for external appeal entities to make a decision in a biased manner, and (ii) for auditing a sample of decisions by such entities to assure that no such decisions are made in a biased manner. (C) Other terms and conditions.--The terms and conditions of a contract under this paragraph shall be consistent with the standards the appropriate Secretary shall establish to assure there is no real or apparent conflict of interest in the conduct of external appeal activities. Such contract shall provide that all costs of the process (except those incurred by the participant, beneficiary, enrollee, or treating professional in support of the appeal) shall be paid by the plan or issuer, and not by the participant, beneficiary, or enrollee. The previous sentence shall not be construed as applying to the imposition of a filing fee under subsection (a)(4). (D) State authority with respect qualified external appeal entity for health insurance issuers.--With respect to health insurance issuers offering health insurance coverage in a State, the State may provide for external review activities to be conducted by a qualified external appeal entity that is designated by the State or that is selected by the State in a manner determined by the State to assure an unbiased determination. (2) Elements of process.--An external appeal process shall be conducted consistent with standards established by the appropriate Secretary that include at least the following: (A) Fair and de novo determination.--The process shall provide for a fair, de novo determination. However, nothing in this paragraph shall be construed as providing for coverage of items and services for which benefits are specifically excluded under the plan or coverage. (B) Standard of review.--An external appeal entity shall determine whether the [[Page H9526]] plan's or issuer's decision is in accordance with the medical needs of the patient involved (as determined by the entity) taking into account, as of the time of the entity's determination, the patient's medical condition and any relevant and reliable evidence the entity obtains under subparagraph (D). If the entity determines the decision is in accordance with such needs, the entity shall affirm the decision and to the extent that the entity determines the decision is not in accordance with such needs, the entity shall reverse or modify the decision. (C) Consideration of plan or coverage definitions.--In making such determination, the external appeal entity shall consider (but not be bound by) any language in the plan or coverage document relating to the definitions of the terms medical necessity, medically necessary or appropriate, or experimental, investigational, or related terms. (D) Evidence.-- (i) In general.--An external appeal entity shall include, among the evidence taken into consideration-- (I) the decision made by the plan or issuer upon internal review under section 102 and any guidelines or standards used by the plan or issuer in reaching such decision; (II) any personal health and medical information supplied with respect to the individual whose denial of claim for benefits has been appealed; and (III) the opinion of the individual's treating physician or health care professional. (ii) Additional evidence.--Such entity may also take into consideration but not be limited to the following evidence (to the extent available): (I) The results of studies that meet professionally recognized standards of validity and replicability or that have been published in peer-reviewed journals. (II) The results of professional consensus conferences conducted or financed in whole or in part by one or more Government agencies. (III) Practice and treatment guidelines prepared or financed in whole or in part by Government agencies. (IV) Government-issued coverage and treatment policies. (V) Community standard of care and generally accepted principles of professional medical practice. (VI) To the extent that the entity determines it to be free of any conflict of interest, the opinions of individuals who are qualified as experts in one or more fields of health care which are directly related to the matters under appeal. (VII) To the extent that the entity determines it to be free of any conflict of interest, the results of peer reviews conducted by the plan or issuer involved. (E) Determination concerning externally appealable decisions.--A qualified external appeal entity shall determine-- (i) whether a denial of claim for benefits is an externally appealable decision (within the meaning of subsection (a)(2)); (ii) whether an externally appealable decision involves an expedited appeal; and (iii) for purposes of initiating an external review, whether the internal review process has been completed. (F) Opportunity to submit evidence.--Each party to an externally appealable decision may submit evidence related to the issues in dispute. (G) Provision of information.--The plan or issuer involved shall provide timely access to the external appeal entity to information and to provisions of the plan or health insurance coverage relating to the matter of the externally appealable decision, as determined by the entity. (H) Timely decisions.--A determination by the external appeal entity on the decision shall-- (i) be made orally or in writing and, if it is made orally, shall be supplied to the parties in writing as soon as possible; (ii) be made in accordance with the medical exigencies of the case involved, but in no event later than 21 days after the date (or, in the case of an expedited appeal, 72 hours after the time) of requesting an external appeal of the decision; (iii) state, in layperson's language, the basis for the determination, including, if relevant, any basis in the terms or conditions of the plan or coverage; and (iv) inform the participant, beneficiary, or enrollee of the individual's rights (including any limitation on such rights) to seek further review by the courts (or other process) of the external appeal determination. (I) Compliance with determination.--If the external appeal entity reverses or modifies the denial of a claim for benefits, the plan or issuer shall-- (i) upon the receipt of the determination, authorize benefits in accordance with such determination; (ii) take such actions as may be necessary to provide benefits (including items or services) in a timely manner consistent with such determination; and (iii) submit information to the entity documenting compliance with the entity's determination and this subparagraph. (c) Qualifications of External Appeal Entities.-- (1) In general.--For purposes of this section, the term ``qualified external appeal entity'' means, in relation to a plan or issuer, an entity that is certified under paragraph (2) as meeting the following requirements: (A) The entity meets the independence requirements of paragraph (3). (B) The entity conducts external appeal activities through a panel of not fewer than three clinical peers. (C) The entity has sufficient medical, legal, and other expertise and sufficient staffing to conduct external appeal activities for the plan or issuer on a timely basis consistent with subsection (b)(2)(G). (D) The entity meets such other requirements as the appropriate Secretary may impose. (2) Initial certification of external appeal entities.-- (A) In general.--In order to be treated as a qualified external appeal entity with respect to-- (i) a group health plan, the entity must be certified (and, in accordance with subparagraph (B), periodically recertified) as meeting the requirements of paragraph (1)-- (I) by the Secretary of Labor; (II) under a process recognized or approved by the Secretary of Labor; or (III) to the extent provided in subparagraph (C)(i), by a qualified private standard-setting organization (certified under such subparagraph); or (ii) a health insurance issuer operating in a State, the entity must be certified (and, in accordance with subparagraph (B), periodically recertified) as meeting such requirements-- (I) by the applicable State authority (or under a process recognized or approved by such authority); or (II) if the State has not established a certification and recertification process for such entities, by the Secretary of Health and Human Services, under a process recognized or approved by such Secretary, or to the extent provided in subparagraph (C)(ii), by a qualified private standard-setting organization (certified under such subparagraph). (B) Recertification process.--The appropriate Secretary shall develop standards for the recertification of external appeal entities. Such standards shall include a review of-- (i) the number of cases reviewed; (ii) a summary of the disposition of those cases; (iii) the length of time in making determinations on those cases; (iv) updated information of what was required to be submitted as a condition of certification for the entity's performance of external appeal activities; and (v) such information as may be necessary to assure the independence of the entity from the plans or issuers for which external appeal activities are being conducted. (C) Certification of qualified private standard-setting organizations.-- (i) For external reviews under group health plans.--For purposes of subparagraph (A)(i)(III), the Secretary of Labor may provide for a process for certification (and periodic recertification) of qualified private standard-setting organizations which provide for certification of external review entities. Such an organization shall only be certified if the organization does not certify an external review entity unless it meets standards required for certification of such an entity by such Secretary under subparagraph (A)(i)(I). (ii) For external reviews of health insurance issuers.--For purposes of subparagraph (A)(ii)(II), the Secretary of Health and Human Services may provide for a process for certification (and periodic recertification) of qualified private standard-setting organizations which provide for certification of external review entities. Such an organization shall only be certified if the organization does not certify an external review entity unless it meets standards required for certification of such an entity by such Secretary under subparagraph (A)(ii)(II). (3) Independence requirements.-- (A) In general.--A clinical peer or other entity meets the independence requirements of this paragraph if-- (i) the peer or entity does not have a familial, financial, or professional relationship with any related party; (ii) any compensation received by such peer or entity in connection with the external review is reasonable and not contingent on any decision rendered by the peer or entity; (iii) except as provided in paragraph (4), the plan and the issuer have no recourse against the peer or entity in connection with the external review; and (iv) the peer or entity does not otherwise have a conflict of interest with a related party as determined under any regulations which the Secretary may prescribe. (B) Related party.--For purposes of this paragraph, the term ``related party'' means-- (i) with respect to-- (I) a group health plan or health insurance coverage offered in connection with such a plan, the plan or the health insurance issuer offering such coverage, or (II) individual health insurance coverage, the health insurance issuer offering such coverage, or any plan sponsor, fiduciary, officer, director, or management employee of such plan or issuer; (ii) the health care professional that provided the health care involved in the coverage decision; (iii) the institution at which the health care involved in the coverage decision is provided; (iv) the manufacturer of any drug or other item that was included in the health care involved in the coverage decision; or [[Page H9527]] (v) any other party determined under any regulations which the Secretary may prescribe to have a substantial interest in the coverage decision. (4) Limitation on liability of reviewers.--No qualified external appeal entity having a contract with a plan or issuer under this part and no person who is employed by any such entity or who furnishes professional services to such entity, shall be held by reason of the performance of any duty, function, or activity required or authorized pursuant to this section, to have violated any criminal law, or to be civilly liable under any law of the United States or of any State (or political subdivision thereof) if due care was exercised in the performance of such duty, function, or activity and there was no actual malice or gross misconduct in the performance of such duty, function, or activity. (d) External Appeal Determination Binding on Plan.--The determination by an external appeal entity under this section is binding on the plan and issuer involved in the determination. (e) Penalties Against Authorized Officials for Refusing to Authorize the Determination of an External Review Entity.-- (1) Monetary penalties.--In any case in which the determination of an external review entity is not followed by a group health plan, or by a health insurance issuer offering health insurance coverage, any person who, acting in the capacity of authorizing the benefit, causes such refusal may, in the discretion in a court of competent jurisdiction, be liable to an aggrieved participant, beneficiary, or enrollee for a civil penalty in an amount of up to $1,000 a day from the date on which the determination was transmitted to the plan or issuer by the external review entity until the date the refusal to provide the benefit is corrected. (2) Cease and desist order and order of attorney's fees.-- In any action described in paragraph (1) brought by a participant, beneficiary, or enrollee with respect to a group health plan, or a health insurance issuer offering health insurance coverage, in which a plaintiff alleges that a person referred to in such paragraph has taken an action resulting in a refusal of a benefit determined by an external appeal entity in violation of such terms of the plan, coverage, or this subtitle, or has failed to take an action for which such person is responsible under the plan, coverage, or this title and which is necessary under the plan or coverage for authorizing a benefit, the court shall cause to be served on the defendant an order requiring the defendant-- (A) to cease and desist from the alleged action or failure to act; and (B) to pay to the plaintiff a reasonable attorney's fee and other reasonable costs relating to the prosecution of the action on the charges on which the plaintiff prevails. (3) Additional civil penalties.-- (A) In general.--In addition to any penalty imposed under paragraph (1) or (2), the appropriate Secretary may assess a civil penalty against a person acting in the capacity of authorizing a benefit determined by an external review entity for one or more group health plans, or health insurance issuers offering health insurance coverage, for-- (i) any pattern or practice of repeated refusal to authorize a benefit determined by an external appeal entity in violation of the terms of such a plan, coverage, or this title; or (ii) any pattern or practice of repeated violations of the requirements of this section with respect to such plan or plans or coverage. (B) Standard of proof and amount of penalty.--Such penalty shall be payable only upon proof by clear and convincing evidence of such pattern or practice and shall be in an amount not to exceed the lesser of-- (i) 25 percent of the aggregate value of benefits shown by the appropriate Secretary to have not been provided, or unlawfully delayed, in violation of this section under such pattern or practice, or (ii) $500,000. (4) Removal and disqualification.--Any person acting in the capacity of authorizing benefits who has engaged in any such pattern or practice described in paragraph (3)(A) with respect to a plan or coverage, upon the petition of the appropriate Secretary, may be removed by the court from such position, and from any other involvement, with respect to such a plan or coverage, and may be precluded from returning to any such position or involvement for a period determined by the court. (f) Protection of Legal Rights.--Nothing in this subtitle shall be construed as altering or eliminating any cause of action or legal rights or remedies of participants, beneficiaries, enrollees, and others under State or Federal law (including sections 502 and 503 of the Employee Retirement Income Security Act of 1974), including the right to file judicial actions to enforce rights. SEC. 104. ESTABLISHMENT OF A GRIEVANCE PROCESS. (a) Establishment of Grievance System.-- (1) In general.--A group health plan, and a health insurance issuer in connection with the provision of health insurance coverage, shall establish and maintain a system to provide for the presentation and resolution of oral and written grievances brought by individuals who are participants, beneficiaries, or enrollees, or health care providers or other individuals acting on behalf of an individual and with the individual's consent or without such consent if the individual is medically unable to provide such consent, regarding any aspect of the plan's or issuer's services. (2) Grievance defined.--In this section, the term ``grievance'' means any question, complaint, or concern brought by a participant, beneficiary or enrollee that is not a claim for benefits (as defined in section 101(f)(1)). (b) Grievance System.--Such system shall include the following components with respect to individuals who are participants, beneficiaries, or enrollees: (1) Written notification to all such individuals and providers of the telephone numbers and business addresses of the plan or issuer personnel responsible for resolution of grievances and appeals. (2) A system to record and document, over a period of at least three previous years, all grievances and appeals made and their status. (3) A process providing for timely processing and resolution of grievances. (4) Procedures for follow-up action, including the methods to inform the person making the grievance of the resolution of the grievance. Grievances are not subject to appeal under the previous provisions of this subtitle. Subtitle B--Access to Care SEC. 111. CONSUMER CHOICE OPTION. (a) In General.--If a health insurance issuer offers to enrollees health insurance coverage in connection with a group health plan which provides for coverage of services only if such services are furnished through health care professionals and providers who are members of a network of health care professionals and providers who have entered into a contract with the issuer to provide such services, the issuer shall also offer or arrange to be offered to such enrollees (at the time of enrollment and during an annual open season as provided under subsection (c)) the option of health insurance coverage which provides for coverage of such services which are not furnished through health care professionals and providers who are members of such a network unless enrollees are offered such non-network coverage through another group health plan or through another health insurance issuer in the group market. (b) Additional Costs.--The amount of any additional premium charged by the health insurance issuer for the additional cost of the creation and maintenance of the option described in subsection (a) and the amount of any additional cost sharing imposed under such option shall be borne by the enrollee unless it is paid by the health plan sponsor through agreement with the health insurance issuer. (c) Open Season.--An enrollee may change to the offering provided under this section only during a time period determined by the health insurance issuer. Such time period shall occur at least annually. SEC. 112. CHOICE OF HEALTH CARE PROFESSIONAL. (a) Primary Care.--If a group health plan, or a health insurance issuer that offers health insurance coverage, requires or provides for designation by a participant, beneficiary, or enrollee of a participating primary care provider, then the plan or issuer shall permit each participant, beneficiary, and enrollee to designate any participating primary care provider who is available to accept such individual. (b) Specialists.-- (1) In general.--Subject to paragraph (2), a group health plan and a health insurance issuer that offers health insurance coverage shall permit each participant, beneficiary, or enrollee to receive medically necessary or appropriate specialty care, pursuant to appropriate referral procedures, from any qualified participating health care professional who is available to accept such individual for such care. (2) Limitation.--Paragraph (1) shall not apply to specialty care if the plan or issuer clearly informs participants, beneficiaries, and enrollees of the limitations on choice of participating health care professionals with respect to such care. (3) Construction.--Nothing in this subsection shall be construed as affecting the application of section 114 (relating to access to specialty care). SEC. 113. ACCESS TO EMERGENCY CARE. (a) Coverage of Emergency Services.-- (1) In general.--If a group health plan, or health insurance coverage offered by a health insurance issuer, provides any benefits with respect to services in an emergency department of a hospital, the plan or issuer shall cover emergency services (as defined in paragraph (2)(B))-- (A) without the need for any prior authorization determination; (B) whether or not the health care provider furnishing such services is a participating provider with respect to such services; (C) in a manner so that, if such services are provided to a participant, beneficiary, or enrollee-- (i) by a nonparticipating health care provider with or without prior authorization, or (ii) by a participating health care provider without prior authorization, the participant, beneficiary, or enrollee is not liable for amounts that exceed the amounts of liability that would be incurred if the services were provided by a participating health care provider with prior authorization; and [[Page H9528]] (D) without regard to any other term or condition of such coverage (other than exclusion or coordination of benefits, or an affiliation or waiting period, permitted under section 2701 of the Public Health Service Act, section 701 of the Employee Retirement Income Security Act of 1974, or section 9801 of the Internal Revenue Code of 1986, and other than applicable cost-sharing). (2) Definitions.--In this section: (A) Emergency medical condition based on prudent layperson standard.--The term ``emergency medical condition'' means a medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain) such that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect the absence of immediate medical attention to result in a condition described in clause (i), (ii), or (iii) of section 1867(e)(1)(A) of the Social Security Act. (B) Emergency services.--The term ``emergency services'' means-- (i) a medical screening examination (as required under section 1867 of the Social Security Act) that is within the capability of the emergency department of a hospital, including ancillary services routinely available to the emergency department to evaluate an emergency medical condition (as defined in subparagraph (A)), and (ii) within the capabilities of the staff and facilities available at the hospital, such further medical examination and treatment as are required under section 1867 of such Act to stabilize the patient. (C) Stabilize.--The term ``to stabilize'' means, with respect to an emergency medical condition, to provide such medical treatment of the condition as may be necessary to assure, within reasonable medical probability, that no material deterioration of the condition is likely to result from or occur during the transfer of the individual from a facility. (b) Reimbursement for Maintenance Care and Post- Stabilization Care.--In the case of services (other than emergency services) for which benefits are available under a group health plan, or under health insurance coverage offered by a health insurance issuer, the plan or issuer shall provide for reimbursement with respect to such services provided to a participant, beneficiary, or enrollee other than through a participating health care provider in a manner consistent with subsection (a)(1)(C) (and shall otherwise comply with the guidelines established under section 1852(d)(2) of the Social Security Act), if the services are maintenance care or post-stabilization care covered under such guidelines. SEC. 114. ACCESS TO SPECIALTY CARE. (a) Specialty Care for Covered Services.-- (1) In general.--If-- (A) an individual is a participant or beneficiary under a group health plan or an enrollee who is covered under health insurance coverage offered by a health insurance issuer, (B) the individual has a condition or disease of sufficient seriousness and complexity to require treatment by a specialist, and (C) benefits for such treatment are provided under the plan or coverage, the plan or issuer shall make or provide for a referral to a specialist who is available and accessible to provide the treatment for such condition or disease. (2) Specialist defined.--For purposes of this subsection, the term ``specialist'' means, with respect to a condition, a health care practitioner, facility, or center that has adequate expertise through appropriate training and experience (including, in the case of a child, appropriate pediatric expertise) to provide high quality care in treating the condition. (3) Care under referral.--A group health plan or health insurance issuer may require that the care provided to an individual pursuant to such referral under paragraph (1) be-- (A) pursuant to a treatment plan, only if the treatment plan is developed by the specialist and approved by the plan or issuer, in consultation with the designated primary care provider or specialist and the individual (or the individual's designee), and (B) in accordance with applicable quality assurance and utilization review standards of the plan or issuer. Nothing in this subsection shall be construed as preventing such a treatment plan for an individual from requiring a specialist to provide the primary care provider with regular updates on the specialty care provided, as well as all necessary medical information. (4) Referrals to participating providers.--A group health plan or health insurance issuer is not required under paragraph (1) to provide for a referral to a specialist that is not a participating provider, unless the plan or issuer does not have an appropriate specialist that is available and accessible to treat the individual's condition and that is a participating provider with respect to such treatment. (5) Treatment of nonparticipating providers.--If a plan or issuer refers an individual to a nonparticipating specialist pursuant to paragraph (1), services provided pursuant to the approved treatment plan (if any) shall be provided at no additional cost to the individual beyond what the individual would otherwise pay for services received by such a specialist that is a participating provider. (b) Specialists as Gatekeeper for Treatment of Ongoing Special Conditions.-- (1) In general.--A group health plan, or a health insurance issuer, in connection with the provision of health insurance coverage, shall have a procedure by which an individual who is a participant, beneficiary, or enrollee and who has an ongoing special condition (as defined in paragraph (3)) may request and receive a referral to a specialist for such condition who shall be responsible for and capable of providing and coordinating the individual's care with respect to the condition. Under such procedures if such an individual's care would most appropriately be coordinated by such a specialist, such plan or issuer shall refer the individual to such specialist. (2) Treatment for related referrals.--Such specialists shall be permitted to treat the individual without a referral from the individual's primary care provider and may authorize such referrals, procedures, tests, and other medical services as the individual's primary care provider would otherwise be permitted to provide or authorize, subject to the terms of the treatment (referred to in subsection (a)(3)(A)) with respect to the ongoing special condition. (3) Ongoing special condition defined.--In this subsection, the term ``ongoing special condition'' means a condition or disease that-- (A) is life-threatening, degenerative, or disabling, and (B) requires specialized medical care over a prolonged period of time. (4) Terms of referral.--The provisions of paragraphs (3) through (5) of subsection (a) apply with respect to referrals under paragraph (1) of this subsection in the same manner as they apply to referrals under subsection (a)(1). (c) Standing Referrals.-- (1) In general.--A group health plan, and a health insurance issuer in connection with the provision of health insurance coverage, shall have a procedure by which an individual who is a participant, beneficiary, or enrollee and who has a condition that requires ongoing care from a specialist may receive a standing referral to such specialist for treatment of such condition. If the plan or issuer, or if the primary care provider in consultation with the medical director of the plan or issuer and the specialist (if any), determines that such a standing referral is appropriate, the plan or issuer shall make such a referral to such a specialist if the individual so desires. (2) Terms of referral.--The provisions of paragraphs (3) through (5) of subsection (a) apply with respect to referrals under paragraph (1) of this subsection in the same manner as they apply to referrals under subsection (a)(1). SEC. 115. ACCESS TO OBSTETRICAL AND GYNECOLOGICAL CARE. (a) In General.--If a group health plan, or a health insurance issuer in connection with the provision of health insurance coverage, requires or provides for a participant, beneficiary, or enrollee to designate a participating primary care health care professional, the plan or issuer-- (1) may not require authorization or a referral by the individual's primary care health care professional or otherwise for coverage of gynecological care (including preventive women's health examinations) and pregnancy-related services provided by a participating health care professional, including a physician, who specializes in obstetrics and gynecology to the extent such care is otherwise covered, and (2) shall treat the ordering of other obstetrical or gynecological care by such a participating professional as the authorization of the primary care health care professional with respect to such care under the plan or coverage. (b) Construction.--Nothing in subsection (a) shall be construed to-- (1) waive any exclusions of coverage under the terms of the plan or health insurance coverage with respect to coverage of obstetrical or gynecological care; or (2) preclude the group health plan or health insurance issuer involved from requiring that the obstetrical or gynecological provider notify the primary care health care professional or the plan or issuer of treatment decisions. SEC. 116. ACCESS TO PEDIATRIC CARE. (a) Pediatric Care.--If a group health plan, or a health insurance issuer in connection with the provision of health insurance coverage, requires or provides for an enrollee to designate a participating primary care provider for a child of such enrollee, the plan or issuer shall permit the enrollee to designate a physician who specializes in pediatrics as the child's primary care provider. (b) Construction.--Nothing in subsection (a) shall be construed to waive any exclusions of coverage under the terms of the plan or health insurance coverage with respect to coverage of pediatric care. SEC. 117. CONTINUITY OF CARE. (a) In General.-- (1) Termination of provider.--If a contract between a group health plan, or a health insurance issuer in connection with the provision of health insurance coverage, and a health care provider is terminated (as defined in paragraph (3)(B)), or benefits or coverage provided by a health care provider are terminated because of a change in the terms of provider participation in a group health plan, and an individual who is a participant, beneficiary, or enrollee in the plan or coverage is undergoing treatment from the provider for an ongoing special condition [[Page H9529]] (as defined in paragraph (3)(A)) at the time of such termination, the plan or issuer shall-- (A) notify the individual on a timely basis of such termination and of the right to elect continuation of coverage of treatment by the provider under this section;

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All articles in House section

BIPARTISAN CONSENSUS MANAGED CARE IMPROVEMENT ACT OF 1999
(House of Representatives - October 07, 1999)

Text of this article available as: TXT PDF [Pages H9523-H9636] BIPARTISAN CONSENSUS MANAGED CARE IMPROVEMENT ACT OF 1999 The SPEAKER pro tempore (Mrs. Biggert). Pursuant to House Resolution 323 and rule XXVIII, the Chair declares the House in the Committee of the Whole House on the State of the Union for the further consideration of the bill, H.R. 2723. {time} 1107 In the Committee of the Whole Accordingly, the House resolved itself into the Committee of the Whole House on the State of the Union for the further consideration of the bill (H.R. 2723) to amend Title I of the Employee Retirement Income Security Act of 1974, title XXVII of the Public Health Service Act, and the Internal Revenue Code of 1986 to protect consumers in managed care plans and other health coverage, with Mr. Hastings of Washington in the chair. The Clerk read the title of the bill. The CHAIRMAN. When the Committee of the Whole rose on Wednesday, October 6, 1999, all time for general debate had expired. Pursuant to the rule, the amendments printed in part A of House Report 106-366 are adopted and the bill, as amended, is considered read for amendment under the 5-minute rule. The text of H.R. 2723, as amended, is as follows: H.R. 2723 Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE; TABLE OF CONTENTS. (a) Short Title.--This Act may be cited as the ``Bipartisan Consensus Managed Care Improvement Act of 1999''. (b) Table of Contents.--The table of contents of this Act is as follows: Sec. 1. Short title; table of contents. TITLE I--IMPROVING MANAGED CARE Subtitle A--Grievances and Appeals Sec. 101. Utilization review activities. Sec. 102. Internal appeals procedures. Sec. 103. External appeals procedures. Sec. 104. Establishment of a grievance process. Subtitle B--Access to Care Sec. 111. Consumer choice option. Sec. 112. Choice of health care professional. Sec. 113. Access to emergency care. Sec. 114. Access to specialty care. Sec. 115. Access to obstetrical and gynecological care. Sec. 116. Access to pediatric care. Sec. 117. Continuity of care. Sec. 118. Access to needed prescription drugs. Sec. 119. Coverage for individuals participating in approved clinical trials. Subtitle C--Access to Information Sec. 121. Patient access to information. Subtitle D--Protecting the Doctor-Patient Relationship Sec. 131. Prohibition of interference with certain medical communications. Sec. 132. Prohibition of discrimination against providers based on licensure. Sec. 133. Prohibition against improper incentive arrangements. Sec. 134. Payment of claims. Sec. 135. Protection for patient advocacy. Subtitle E--Definitions Sec. 151. Definitions. Sec. 152. Preemption; State flexibility; construction. Sec. 153. Exclusions. Sec. 154. Coverage of limited scope plans. Sec. 155. Regulations. TITLE II--APPLICATION OF QUALITY CARE STANDARDS TO GROUP HEALTH PLANS AND HEALTH INSURANCE COVERAGE UNDER THE PUBLIC HEALTH SERVICE ACT Sec. 201. Application to group health plans and group health insurance coverage. Sec. 202. Application to individual health insurance coverage. TITLE III--AMENDMENTS TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974 Sec. 301. Application of patient protection standards to group health plans and group health insurance coverage under the Employee Retirement Income Security Act of 1974. Sec. 302. ERISA preemption not to apply to certain actions involving health insurance policyholders. TITLE IV--APPLICATION TO GROUP HEALTH PLANS UNDER THE INTERNAL REVENUE CODE OF 1986 Sec. 401. Amendments to the Internal Revenue Code of 1986. TITLE V--EFFECTIVE DATES; COORDINATION IN IMPLEMENTATION Sec. 501. Effective dates. Sec. 502. Coordination in implementation. TITLE VI--HEALTH CARE PAPERWORK SIMPLIFICATION Sec. 601. Health care paperwork simplification. TITLE I--IMPROVING MANAGED CARE Subtitle A--Grievance and Appeals SEC. 101. UTILIZATION REVIEW ACTIVITIES. (a) Compliance With Requirements.-- (1) In general.--A group health plan, and a health insurance issuer that provides health insurance coverage, shall conduct utilization review activities in connection with the provision of benefits under such plan or coverage only in accordance with a utilization review program that meets the requirements of this section. (2) Use of outside agents.--Nothing in this section shall be construed as preventing a group health plan or health insurance issuer from arranging through a contract or otherwise for persons or entities to conduct utilization review activities on behalf of the plan or issuer, so long as such activities are conducted in accordance with a utilization review program that meets the requirements of this section. (3) Utilization review defined.--For purposes of this section, the terms ``utilization [[Page H9524]] review'' and ``utilization review activities'' mean procedures used to monitor or evaluate the use or coverage, clinical necessity, appropriateness, efficacy, or efficiency of health care services, procedures or settings, and includes prospective review, concurrent review, second opinions, case management, discharge planning, or retrospective review. (b) Written Policies and Criteria.-- (1) Written policies.--A utilization review program shall be conducted consistent with written policies and procedures that govern all aspects of the program. (2) Use of written criteria.-- (A) In general.--Such a program shall utilize written clinical review criteria developed with input from a range of appropriate actively practicing health care professionals, as determined by the plan, pursuant to the program. Such criteria shall include written clinical review criteria that are based on valid clinical evidence where available and that are directed specifically at meeting the needs of at-risk populations and covered individuals with chronic conditions or severe illnesses, including gender-specific criteria and pediatric-specific criteria where available and appropriate. (B) Continuing use of standards in retrospective review.-- If a health care service has been specifically pre-authorized or approved for an enrollee under such a program, the program shall not, pursuant to retrospective review, revise or modify the specific standards, criteria, or procedures used for the utilization review for procedures, treatment, and services delivered to the enrollee during the same course of treatment. (C) Review of sample of claims denials.--Such a program shall provide for an evaluation of the clinical appropriateness of at least a sample of denials of claims for benefits. (c) Conduct of Program Activities.-- (1) Administration by health care professionals.--A utilization review program shall be administered by qualified health care professionals who shall oversee review decisions. (2) Use of qualified, independent personnel.-- (A) In general.--A utilization review program shall provide for the conduct of utilization review activities only through personnel who are qualified and have received appropriate training in the conduct of such activities under the program. (B) Prohibition of contingent compensation arrangements.-- Such a program shall not, with respect to utilization review activities, permit or provide compensation or anything of value to its employees, agents, or contractors in a manner that encourages denials of claims for benefits. (C) Prohibition of conflicts.--Such a program shall not permit a health care professional who is providing health care services to an individual to perform utilization review activities in connection with the health care services being provided to the individual. (3) Accessibility of review.--Such a program shall provide that appropriate personnel performing utilization review activities under the program, including the utilization review administrator, are reasonably accessible by toll-free telephone during normal business hours to discuss patient care and allow response to telephone requests, and that appropriate provision is made to receive and respond promptly to calls received during other hours. (4) Limits on frequency.--Such a program shall not provide for the performance of utilization review activities with respect to a class of services furnished to an individual more frequently than is reasonably required to assess whether the services under review are medically necessary or appropriate. (d) Deadline for Determinations.-- (1) Prior authorization services.-- (A) In general.--Except as provided in paragraph (2), in the case of a utilization review activity involving the prior authorization of health care items and services for an individual, the utilization review program shall make a determination concerning such authorization, and provide notice of the determination to the individual or the individual's designee and the individual's health care provider by telephone and in printed form, as soon as possible in accordance with the medical exigencies of the case, and in no event later than the deadline specified in subparagraph (B). (B) Deadline.-- (i) In general.--Subject to clauses (ii) and (iii), the deadline specified in this subparagraph is 14 days after the date of receipt of the request for prior authorization. (ii) Extension permitted where notice of additional information required.--If a utilization review program-- (I) receives a request for a prior authorization, (II) determines that additional information is necessary to complete the review and make the determination on the request, and (III) notifies the requester, not later than five business days after the date of receiving the request, of the need for such specified additional information, the deadline specified in this subparagraph is 14 days after the date the program receives the specified additional information, but in no case later than 28 days after the date of receipt of the request for the prior authorization. This clause shall not apply if the deadline is specified in clause (iii). (iii) Expedited cases.--In the case of a situation described in section 102(c)(1)(A), the deadline specified in this subparagraph is 72 hours after the time of the request for prior authorization. (2) Ongoing care.-- (A) Concurrent review.-- (i) In general.--Subject to subparagraph (B), in the case of a concurrent review of ongoing care (including hospitalization), which results in a termination or reduction of such care, the plan must provide by telephone and in printed form notice of the concurrent review determination to the individual or the individual's designee and the individual's health care provider as soon as possible in accordance with the medical exigencies of the case, with sufficient time prior to the termination or reduction to allow for an appeal under section 102(c)(1)(A) to be completed before the termination or reduction takes effect. (ii) Contents of notice.--Such notice shall include, with respect to ongoing health care items and services, the number of ongoing services approved, the new total of approved services, the date of onset of services, and the next review date, if any, as well as a statement of the individual's rights to further appeal. (B) Exception.--Subparagraph (A) shall not be interpreted as requiring plans or issuers to provide coverage of care that would exceed the coverage limitations for such care. (3) Previously provided services.--In the case of a utilization review activity involving retrospective review of health care services previously provided for an individual, the utilization review program shall make a determination concerning such services, and provide notice of the determination to the individual or the individual's designee and the individual's health care provider by telephone and in printed form, within 30 days of the date of receipt of information that is reasonably necessary to make such determination, but in no case later than 60 days after the date of receipt of the claim for benefits. (4) Failure to meet deadline.--In a case in which a group health plan or health insurance issuer fails to make a determination on a claim for benefit under paragraph (1), (2)(A), or (3) by the applicable deadline established under the respective paragraph, the failure shall be treated under this subtitle as a denial of the claim as of the date of the deadline. (5) Reference to special rules for emergency services, maintenance care, and post-stabilization care.--For waiver of prior authorization requirements in certain cases involving emergency services and maintenance care and post- stabilization care, see subsections (a)(1) and (b) of section 113, respectively. (e) Notice of Denials of Claims for Benefits.-- (1) In general.--Notice of a denial of claims for benefits under a utilization review program shall be provided in printed form and written in a manner calculated to be understood by the participant, beneficiary, or enrollee and shall include-- (A) the reasons for the denial (including the clinical rationale); (B) instructions on how to initiate an appeal under section 102; and (C) notice of the availability, upon request of the individual (or the individual's designee) of the clinical review criteria relied upon to make such denial. (2) Specification of any additional information.--Such a notice shall also specify what (if any) additional necessary information must be provided to, or obtained by, the person making the denial in order to make a decision on such an appeal. (f) Claim for Benefits and Denial of Claim for Benefits Defined.--For purposes of this subtitle: (1) Claim for benefits.--The term ``claim for benefits'' means any request for coverage (including authorization of coverage), for eligibility, or for payment in whole or in part, for an item or service under a group health plan or health insurance coverage. (2) Denial of claim for benefits.--The term ``denial'' means, with respect to a claim for benefits, means a denial, or a failure to act on a timely basis upon, in whole or in part, the claim for benefits and includes a failure to provide benefits (including items and services) required to be provided under this title. SEC. 102. INTERNAL APPEALS PROCEDURES. (a) Right of Review.-- (1) In general.--Each group health plan, and each health insurance issuer offering health insurance coverage-- (A) shall provide adequate notice in writing to any participant or beneficiary under such plan, or enrollee under such coverage, whose claim for benefits under the plan or coverage has been denied (within the meaning of section 101(f)(2)), setting forth the specific reasons for such denial of claim for benefits and rights to any further review or appeal, written in a manner calculated to be understood by the participant, beneficiary, or enrollee; and (B) shall afford such a participant, beneficiary, or enrollee (and any provider or other person acting on behalf of such an individual with the individual's consent or without such consent if the individual is medically unable to provide such consent) who is dissatisfied with such a denial of claim for benefits a reasonable opportunity (of not less than 180 days) to request and obtain a full and fair review by a named fiduciary (with respect to such plan) or named appropriate [[Page H9525]] individual (with respect to such coverage) of the decision denying the claim. (2) Treatment of oral requests.--The request for review under paragraph (1)(B) may be made orally, but, in the case of an oral request, shall be followed by a request in writing. (b) Internal Review Process.-- (1) Conduct of review.-- (A) In general.--A review of a denial of claim under this section shall be made by an individual who-- (i) in a case involving medical judgment, shall be a physician or, in the case of limited scope coverage (as defined in subparagraph (B), shall be an appropriate specialist; (ii) has been selected by the plan or issuer; and (iii) did not make the initial denial in the internally appealable decision. (B) Limited scope coverage defined.--For purposes of subparagraph (A), the term ``limited scope coverage'' means a group health plan or health insurance coverage the only benefits under which are for benefits described in section 2791(c)(2)(A) of the Public Health Service Act (42 U.S.C. 300gg-91(c)(2)). (2) Time limits for internal reviews.-- (A) In general.--Having received such a request for review of a denial of claim, the plan or issuer shall, in accordance with the medical exigencies of the case but not later than the deadline specified in subparagraph (B), complete the review on the denial and transmit to the participant, beneficiary, enrollee, or other person involved a decision that affirms, reverses, or modifies the denial. If the decision does not reverse the denial, the plan or issuer shall transmit, in printed form, a notice that sets forth the grounds for such decision and that includes a description of rights to any further appeal. Such decision shall be treated as the final decision of the plan. Failure to issue such a decision by such deadline shall be treated as a final decision affirming the denial of claim. (B) Deadline.-- (i) In general.--Subject to clauses (ii) and (iii), the deadline specified in this subparagraph is 14 days after the date of receipt of the request for internal review. (ii) Extension permitted where notice of additional information required.--If a group health plan or health insurance issuer-- (I) receives a request for internal review, (II) determines that additional information is necessary to complete the review and make the determination on the request, and (III) notifies the requester, not later than five business days after the date of receiving the request, of the need for such specified additional information, the deadline specified in this subparagraph is 14 days after the date the plan or issuer receives the specified additional information, but in no case later than 28 days after the date of receipt of the request for the internal review. This clause shall not apply if the deadline is specified in clause (iii). (iii) Expedited cases.--In the case of a situation described in subsection (c)(1)(A), the deadline specified in this subparagraph is 72 hours after the time of the request for review. (c) Expedited Review Process.-- (1) In general.--A group health plan, and a health insurance issuer, shall establish procedures in writing for the expedited consideration of requests for review under subsection (b) in situations-- (A) in which the application of the normal timeframe for making a determination could seriously jeopardize the life or health of the participant, beneficiary, or enrollee or such an individual's ability to regain maximum function; or (B) described in section 101(d)(2) (relating to requests for continuation of ongoing care which would otherwise be reduced or terminated). (2) Process.--Under such procedures-- (A) the request for expedited review may be submitted orally or in writing by an individual or provider who is otherwise entitled to request the review; (B) all necessary information, including the plan's or issuer's decision, shall be transmitted between the plan or issuer and the requester by telephone, facsimile, or other similarly expeditious available method; and (C) the plan or issuer shall expedite the review in the case of any of the situations described in subparagraph (A) or (B) of paragraph (1). (3) Deadline for decision.--The decision on the expedited review must be made and communicated to the parties as soon as possible in accordance with the medical exigencies of the case, and in no event later than 72 hours after the time of receipt of the request for expedited review, except that in a case described in paragraph (1)(B), the decision must be made before the end of the approved period of care. (d) Waiver of Process.--A plan or issuer may waive its rights for an internal review under subsection (b). In such case the participant, beneficiary, or enrollee involved (and any designee or provider involved) shall be relieved of any obligation to complete the review involved and may, at the option of such participant, beneficiary, enrollee, designee, or provider, proceed directly to seek further appeal through any applicable external appeals process. SEC. 103. EXTERNAL APPEALS PROCEDURES. (a) Right to External Appeal.-- (1) In general.--A group health plan, and a health insurance issuer offering health insurance coverage, shall provide for an external appeals process that meets the requirements of this section in the case of an externally appealable decision described in paragraph (2), for which a timely appeal is made either by the plan or issuer or by the participant, beneficiary, or enrollee (and any provider or other person acting on behalf of such an individual with the individual's consent or without such consent if such an individual is medically unable to provide such consent). The appropriate Secretary shall establish standards to carry out such requirements. (2) Externally appealable decision defined.-- (A) In general.--For purposes of this section, the term ``externally appealable decision'' means a denial of claim for benefits (as defined in section 101(f)(2))-- (i) that is based in whole or in part on a decision that the item or service is not medically necessary or appropriate or is investigational or experimental; or (ii) in which the decision as to whether a benefit is covered involves a medical judgment. (B) Inclusion.--Such term also includes a failure to meet an applicable deadline for internal review under section 102. (C) Exclusions.--Such term does not include-- (i) specific exclusions or express limitations on the amount, duration, or scope of coverage that do not involve medical judgment; or (ii) a decision regarding whether an individual is a participant, beneficiary, or enrollee under the plan or coverage. (3) Exhaustion of internal review process.--Except as provided under section 102(d), a plan or issuer may condition the use of an external appeal process in the case of an externally appealable decision upon a final decision in an internal review under section 102, but only if the decision is made in a timely basis consistent with the deadlines provided under this subtitle. (4) Filing fee requirement.-- (A) In general.--Subject to subparagraph (B), a plan or issuer may condition the use of an external appeal process upon payment to the plan or issuer of a filing fee that does not exceed $25. (B) Exception for indigency.--The plan or issuer may not require payment of the filing fee in the case of an individual participant, beneficiary, or enrollee who certifies (in a form and manner specified in guidelines established by the Secretary of Health and Human Services) that the individual is indigent (as defined in such guidelines). (C) Refunding fee in case of successful appeals.--The plan or issuer shall refund payment of the filing fee under this paragraph if the recommendation of the external appeal entity is to reverse or modify the denial of a claim for benefits which is the subject of the appeal. (b) General Elements of External Appeals Process.-- (1) Contract with qualified external appeal entity.-- (A) Contract requirement.--Except as provided in subparagraph (D), the external appeal process under this section of a plan or issuer shall be conducted under a contract between the plan or issuer and one or more qualified external appeal entities (as defined in subsection (c)). (B) Limitation on plan or issuer selection.--The applicable authority shall implement procedures-- (i) to assure that the selection process among qualified external appeal entities will not create any incentives for external appeal entities to make a decision in a biased manner, and (ii) for auditing a sample of decisions by such entities to assure that no such decisions are made in a biased manner. (C) Other terms and conditions.--The terms and conditions of a contract under this paragraph shall be consistent with the standards the appropriate Secretary shall establish to assure there is no real or apparent conflict of interest in the conduct of external appeal activities. Such contract shall provide that all costs of the process (except those incurred by the participant, beneficiary, enrollee, or treating professional in support of the appeal) shall be paid by the plan or issuer, and not by the participant, beneficiary, or enrollee. The previous sentence shall not be construed as applying to the imposition of a filing fee under subsection (a)(4). (D) State authority with respect qualified external appeal entity for health insurance issuers.--With respect to health insurance issuers offering health insurance coverage in a State, the State may provide for external review activities to be conducted by a qualified external appeal entity that is designated by the State or that is selected by the State in a manner determined by the State to assure an unbiased determination. (2) Elements of process.--An external appeal process shall be conducted consistent with standards established by the appropriate Secretary that include at least the following: (A) Fair and de novo determination.--The process shall provide for a fair, de novo determination. However, nothing in this paragraph shall be construed as providing for coverage of items and services for which benefits are specifically excluded under the plan or coverage. (B) Standard of review.--An external appeal entity shall determine whether the [[Page H9526]] plan's or issuer's decision is in accordance with the medical needs of the patient involved (as determined by the entity) taking into account, as of the time of the entity's determination, the patient's medical condition and any relevant and reliable evidence the entity obtains under subparagraph (D). If the entity determines the decision is in accordance with such needs, the entity shall affirm the decision and to the extent that the entity determines the decision is not in accordance with such needs, the entity shall reverse or modify the decision. (C) Consideration of plan or coverage definitions.--In making such determination, the external appeal entity shall consider (but not be bound by) any language in the plan or coverage document relating to the definitions of the terms medical necessity, medically necessary or appropriate, or experimental, investigational, or related terms. (D) Evidence.-- (i) In general.--An external appeal entity shall include, among the evidence taken into consideration-- (I) the decision made by the plan or issuer upon internal review under section 102 and any guidelines or standards used by the plan or issuer in reaching such decision; (II) any personal health and medical information supplied with respect to the individual whose denial of claim for benefits has been appealed; and (III) the opinion of the individual's treating physician or health care professional. (ii) Additional evidence.--Such entity may also take into consideration but not be limited to the following evidence (to the extent available): (I) The results of studies that meet professionally recognized standards of validity and replicability or that have been published in peer-reviewed journals. (II) The results of professional consensus conferences conducted or financed in whole or in part by one or more Government agencies. (III) Practice and treatment guidelines prepared or financed in whole or in part by Government agencies. (IV) Government-issued coverage and treatment policies. (V) Community standard of care and generally accepted principles of professional medical practice. (VI) To the extent that the entity determines it to be free of any conflict of interest, the opinions of individuals who are qualified as experts in one or more fields of health care which are directly related to the matters under appeal. (VII) To the extent that the entity determines it to be free of any conflict of interest, the results of peer reviews conducted by the plan or issuer involved. (E) Determination concerning externally appealable decisions.--A qualified external appeal entity shall determine-- (i) whether a denial of claim for benefits is an externally appealable decision (within the meaning of subsection (a)(2)); (ii) whether an externally appealable decision involves an expedited appeal; and (iii) for purposes of initiating an external review, whether the internal review process has been completed. (F) Opportunity to submit evidence.--Each party to an externally appealable decision may submit evidence related to the issues in dispute. (G) Provision of information.--The plan or issuer involved shall provide timely access to the external appeal entity to information and to provisions of the plan or health insurance coverage relating to the matter of the externally appealable decision, as determined by the entity. (H) Timely decisions.--A determination by the external appeal entity on the decision shall-- (i) be made orally or in writing and, if it is made orally, shall be supplied to the parties in writing as soon as possible; (ii) be made in accordance with the medical exigencies of the case involved, but in no event later than 21 days after the date (or, in the case of an expedited appeal, 72 hours after the time) of requesting an external appeal of the decision; (iii) state, in layperson's language, the basis for the determination, including, if relevant, any basis in the terms or conditions of the plan or coverage; and (iv) inform the participant, beneficiary, or enrollee of the individual's rights (including any limitation on such rights) to seek further review by the courts (or other process) of the external appeal determination. (I) Compliance with determination.--If the external appeal entity reverses or modifies the denial of a claim for benefits, the plan or issuer shall-- (i) upon the receipt of the determination, authorize benefits in accordance with such determination; (ii) take such actions as may be necessary to provide benefits (including items or services) in a timely manner consistent with such determination; and (iii) submit information to the entity documenting compliance with the entity's determination and this subparagraph. (c) Qualifications of External Appeal Entities.-- (1) In general.--For purposes of this section, the term ``qualified external appeal entity'' means, in relation to a plan or issuer, an entity that is certified under paragraph (2) as meeting the following requirements: (A) The entity meets the independence requirements of paragraph (3). (B) The entity conducts external appeal activities through a panel of not fewer than three clinical peers. (C) The entity has sufficient medical, legal, and other expertise and sufficient staffing to conduct external appeal activities for the plan or issuer on a timely basis consistent with subsection (b)(2)(G). (D) The entity meets such other requirements as the appropriate Secretary may impose. (2) Initial certification of external appeal entities.-- (A) In general.--In order to be treated as a qualified external appeal entity with respect to-- (i) a group health plan, the entity must be certified (and, in accordance with subparagraph (B), periodically recertified) as meeting the requirements of paragraph (1)-- (I) by the Secretary of Labor; (II) under a process recognized or approved by the Secretary of Labor; or (III) to the extent provided in subparagraph (C)(i), by a qualified private standard-setting organization (certified under such subparagraph); or (ii) a health insurance issuer operating in a State, the entity must be certified (and, in accordance with subparagraph (B), periodically recertified) as meeting such requirements-- (I) by the applicable State authority (or under a process recognized or approved by such authority); or (II) if the State has not established a certification and recertification process for such entities, by the Secretary of Health and Human Services, under a process recognized or approved by such Secretary, or to the extent provided in subparagraph (C)(ii), by a qualified private standard-setting organization (certified under such subparagraph). (B) Recertification process.--The appropriate Secretary shall develop standards for the recertification of external appeal entities. Such standards shall include a review of-- (i) the number of cases reviewed; (ii) a summary of the disposition of those cases; (iii) the length of time in making determinations on those cases; (iv) updated information of what was required to be submitted as a condition of certification for the entity's performance of external appeal activities; and (v) such information as may be necessary to assure the independence of the entity from the plans or issuers for which external appeal activities are being conducted. (C) Certification of qualified private standard-setting organizations.-- (i) For external reviews under group health plans.--For purposes of subparagraph (A)(i)(III), the Secretary of Labor may provide for a process for certification (and periodic recertification) of qualified private standard-setting organizations which provide for certification of external review entities. Such an organization shall only be certified if the organization does not certify an external review entity unless it meets standards required for certification of such an entity by such Secretary under subparagraph (A)(i)(I). (ii) For external reviews of health insurance issuers.--For purposes of subparagraph (A)(ii)(II), the Secretary of Health and Human Services may provide for a process for certification (and periodic recertification) of qualified private standard-setting organizations which provide for certification of external review entities. Such an organization shall only be certified if the organization does not certify an external review entity unless it meets standards required for certification of such an entity by such Secretary under subparagraph (A)(ii)(II). (3) Independence requirements.-- (A) In general.--A clinical peer or other entity meets the independence requirements of this paragraph if-- (i) the peer or entity does not have a familial, financial, or professional relationship with any related party; (ii) any compensation received by such peer or entity in connection with the external review is reasonable and not contingent on any decision rendered by the peer or entity; (iii) except as provided in paragraph (4), the plan and the issuer have no recourse against the peer or entity in connection with the external review; and (iv) the peer or entity does not otherwise have a conflict of interest with a related party as determined under any regulations which the Secretary may prescribe. (B) Related party.--For purposes of this paragraph, the term ``related party'' means-- (i) with respect to-- (I) a group health plan or health insurance coverage offered in connection with such a plan, the plan or the health insurance issuer offering such coverage, or (II) individual health insurance coverage, the health insurance issuer offering such coverage, or any plan sponsor, fiduciary, officer, director, or management employee of such plan or issuer; (ii) the health care professional that provided the health care involved in the coverage decision; (iii) the institution at which the health care involved in the coverage decision is provided; (iv) the manufacturer of any drug or other item that was included in the health care involved in the coverage decision; or [[Page H9527]] (v) any other party determined under any regulations which the Secretary may prescribe to have a substantial interest in the coverage decision. (4) Limitation on liability of reviewers.--No qualified external appeal entity having a contract with a plan or issuer under this part and no person who is employed by any such entity or who furnishes professional services to such entity, shall be held by reason of the performance of any duty, function, or activity required or authorized pursuant to this section, to have violated any criminal law, or to be civilly liable under any law of the United States or of any State (or political subdivision thereof) if due care was exercised in the performance of such duty, function, or activity and there was no actual malice or gross misconduct in the performance of such duty, function, or activity. (d) External Appeal Determination Binding on Plan.--The determination by an external appeal entity under this section is binding on the plan and issuer involved in the determination. (e) Penalties Against Authorized Officials for Refusing to Authorize the Determination of an External Review Entity.-- (1) Monetary penalties.--In any case in which the determination of an external review entity is not followed by a group health plan, or by a health insurance issuer offering health insurance coverage, any person who, acting in the capacity of authorizing the benefit, causes such refusal may, in the discretion in a court of competent jurisdiction, be liable to an aggrieved participant, beneficiary, or enrollee for a civil penalty in an amount of up to $1,000 a day from the date on which the determination was transmitted to the plan or issuer by the external review entity until the date the refusal to provide the benefit is corrected. (2) Cease and desist order and order of attorney's fees.-- In any action described in paragraph (1) brought by a participant, beneficiary, or enrollee with respect to a group health plan, or a health insurance issuer offering health insurance coverage, in which a plaintiff alleges that a person referred to in such paragraph has taken an action resulting in a refusal of a benefit determined by an external appeal entity in violation of such terms of the plan, coverage, or this subtitle, or has failed to take an action for which such person is responsible under the plan, coverage, or this title and which is necessary under the plan or coverage for authorizing a benefit, the court shall cause to be served on the defendant an order requiring the defendant-- (A) to cease and desist from the alleged action or failure to act; and (B) to pay to the plaintiff a reasonable attorney's fee and other reasonable costs relating to the prosecution of the action on the charges on which the plaintiff prevails. (3) Additional civil penalties.-- (A) In general.--In addition to any penalty imposed under paragraph (1) or (2), the appropriate Secretary may assess a civil penalty against a person acting in the capacity of authorizing a benefit determined by an external review entity for one or more group health plans, or health insurance issuers offering health insurance coverage, for-- (i) any pattern or practice of repeated refusal to authorize a benefit determined by an external appeal entity in violation of the terms of such a plan, coverage, or this title; or (ii) any pattern or practice of repeated violations of the requirements of this section with respect to such plan or plans or coverage. (B) Standard of proof and amount of penalty.--Such penalty shall be payable only upon proof by clear and convincing evidence of such pattern or practice and shall be in an amount not to exceed the lesser of-- (i) 25 percent of the aggregate value of benefits shown by the appropriate Secretary to have not been provided, or unlawfully delayed, in violation of this section under such pattern or practice, or (ii) $500,000. (4) Removal and disqualification.--Any person acting in the capacity of authorizing benefits who has engaged in any such pattern or practice described in paragraph (3)(A) with respect to a plan or coverage, upon the petition of the appropriate Secretary, may be removed by the court from such position, and from any other involvement, with respect to such a plan or coverage, and may be precluded from returning to any such position or involvement for a period determined by the court. (f) Protection of Legal Rights.--Nothing in this subtitle shall be construed as altering or eliminating any cause of action or legal rights or remedies of participants, beneficiaries, enrollees, and others under State or Federal law (including sections 502 and 503 of the Employee Retirement Income Security Act of 1974), including the right to file judicial actions to enforce rights. SEC. 104. ESTABLISHMENT OF A GRIEVANCE PROCESS. (a) Establishment of Grievance System.-- (1) In general.--A group health plan, and a health insurance issuer in connection with the provision of health insurance coverage, shall establish and maintain a system to provide for the presentation and resolution of oral and written grievances brought by individuals who are participants, beneficiaries, or enrollees, or health care providers or other individuals acting on behalf of an individual and with the individual's consent or without such consent if the individual is medically unable to provide such consent, regarding any aspect of the plan's or issuer's services. (2) Grievance defined.--In this section, the term ``grievance'' means any question, complaint, or concern brought by a participant, beneficiary or enrollee that is not a claim for benefits (as defined in section 101(f)(1)). (b) Grievance System.--Such system shall include the following components with respect to individuals who are participants, beneficiaries, or enrollees: (1) Written notification to all such individuals and providers of the telephone numbers and business addresses of the plan or issuer personnel responsible for resolution of grievances and appeals. (2) A system to record and document, over a period of at least three previous years, all grievances and appeals made and their status. (3) A process providing for timely processing and resolution of grievances. (4) Procedures for follow-up action, including the methods to inform the person making the grievance of the resolution of the grievance. Grievances are not subject to appeal under the previous provisions of this subtitle. Subtitle B--Access to Care SEC. 111. CONSUMER CHOICE OPTION. (a) In General.--If a health insurance issuer offers to enrollees health insurance coverage in connection with a group health plan which provides for coverage of services only if such services are furnished through health care professionals and providers who are members of a network of health care professionals and providers who have entered into a contract with the issuer to provide such services, the issuer shall also offer or arrange to be offered to such enrollees (at the time of enrollment and during an annual open season as provided under subsection (c)) the option of health insurance coverage which provides for coverage of such services which are not furnished through health care professionals and providers who are members of such a network unless enrollees are offered such non-network coverage through another group health plan or through another health insurance issuer in the group market. (b) Additional Costs.--The amount of any additional premium charged by the health insurance issuer for the additional cost of the creation and maintenance of the option described in subsection (a) and the amount of any additional cost sharing imposed under such option shall be borne by the enrollee unless it is paid by the health plan sponsor through agreement with the health insurance issuer. (c) Open Season.--An enrollee may change to the offering provided under this section only during a time period determined by the health insurance issuer. Such time period shall occur at least annually. SEC. 112. CHOICE OF HEALTH CARE PROFESSIONAL. (a) Primary Care.--If a group health plan, or a health insurance issuer that offers health insurance coverage, requires or provides for designation by a participant, beneficiary, or enrollee of a participating primary care provider, then the plan or issuer shall permit each participant, beneficiary, and enrollee to designate any participating primary care provider who is available to accept such individual. (b) Specialists.-- (1) In general.--Subject to paragraph (2), a group health plan and a health insurance issuer that offers health insurance coverage shall permit each participant, beneficiary, or enrollee to receive medically necessary or appropriate specialty care, pursuant to appropriate referral procedures, from any qualified participating health care professional who is available to accept such individual for such care. (2) Limitation.--Paragraph (1) shall not apply to specialty care if the plan or issuer clearly informs participants, beneficiaries, and enrollees of the limitations on choice of participating health care professionals with respect to such care. (3) Construction.--Nothing in this subsection shall be construed as affecting the application of section 114 (relating to access to specialty care). SEC. 113. ACCESS TO EMERGENCY CARE. (a) Coverage of Emergency Services.-- (1) In general.--If a group health plan, or health insurance coverage offered by a health insurance issuer, provides any benefits with respect to services in an emergency department of a hospital, the plan or issuer shall cover emergency services (as defined in paragraph (2)(B))-- (A) without the need for any prior authorization determination; (B) whether or not the health care provider furnishing such services is a participating provider with respect to such services; (C) in a manner so that, if such services are provided to a participant, beneficiary, or enrollee-- (i) by a nonparticipating health care provider with or without prior authorization, or (ii) by a participating health care provider without prior authorization, the participant, beneficiary, or enrollee is not liable for amounts that exceed the amounts of liability that would be incurred if the services were provided by a participating health care provider with prior authorization; and [[Page H9528]] (D) without regard to any other term or condition of such coverage (other than exclusion or coordination of benefits, or an affiliation or waiting period, permitted under section 2701 of the Public Health Service Act, section 701 of the Employee Retirement Income Security Act of 1974, or section 9801 of the Internal Revenue Code of 1986, and other than applicable cost-sharing). (2) Definitions.--In this section: (A) Emergency medical condition based on prudent layperson standard.--The term ``emergency medical condition'' means a medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain) such that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect the absence of immediate medical attention to result in a condition described in clause (i), (ii), or (iii) of section 1867(e)(1)(A) of the Social Security Act. (B) Emergency services.--The term ``emergency services'' means-- (i) a medical screening examination (as required under section 1867 of the Social Security Act) that is within the capability of the emergency department of a hospital, including ancillary services routinely available to the emergency department to evaluate an emergency medical condition (as defined in subparagraph (A)), and (ii) within the capabilities of the staff and facilities available at the hospital, such further medical examination and treatment as are required under section 1867 of such Act to stabilize the patient. (C) Stabilize.--The term ``to stabilize'' means, with respect to an emergency medical condition, to provide such medical treatment of the condition as may be necessary to assure, within reasonable medical probability, that no material deterioration of the condition is likely to result from or occur during the transfer of the individual from a facility. (b) Reimbursement for Maintenance Care and Post- Stabilization Care.--In the case of services (other than emergency services) for which benefits are available under a group health plan, or under health insurance coverage offered by a health insurance issuer, the plan or issuer shall provide for reimbursement with respect to such services provided to a participant, beneficiary, or enrollee other than through a participating health care provider in a manner consistent with subsection (a)(1)(C) (and shall otherwise comply with the guidelines established under section 1852(d)(2) of the Social Security Act), if the services are maintenance care or post-stabilization care covered under such guidelines. SEC. 114. ACCESS TO SPECIALTY CARE. (a) Specialty Care for Covered Services.-- (1) In general.--If-- (A) an individual is a participant or beneficiary under a group health plan or an enrollee who is covered under health insurance coverage offered by a health insurance issuer, (B) the individual has a condition or disease of sufficient seriousness and complexity to require treatment by a specialist, and (C) benefits for such treatment are provided under the plan or coverage, the plan or issuer shall make or provide for a referral to a specialist who is available and accessible to provide the treatment for such condition or disease. (2) Specialist defined.--For purposes of this subsection, the term ``specialist'' means, with respect to a condition, a health care practitioner, facility, or center that has adequate expertise through appropriate training and experience (including, in the case of a child, appropriate pediatric expertise) to provide high quality care in treating the condition. (3) Care under referral.--A group health plan or health insurance issuer may require that the care provided to an individual pursuant to such referral under paragraph (1) be-- (A) pursuant to a treatment plan, only if the treatment plan is developed by the specialist and approved by the plan or issuer, in consultation with the designated primary care provider or specialist and the individual (or the individual's designee), and (B) in accordance with applicable quality assurance and utilization review standards of the plan or issuer. Nothing in this subsection shall be construed as preventing such a treatment plan for an individual from requiring a specialist to provide the primary care provider with regular updates on the specialty care provided, as well as all necessary medical information. (4) Referrals to participating providers.--A group health plan or health insurance issuer is not required under paragraph (1) to provide for a referral to a specialist that is not a participating provider, unless the plan or issuer does not have an appropriate specialist that is available and accessible to treat the individual's condition and that is a participating provider with respect to such treatment. (5) Treatment of nonparticipating providers.--If a plan or issuer refers an individual to a nonparticipating specialist pursuant to paragraph (1), services provided pursuant to the approved treatment plan (if any) shall be provided at no additional cost to the individual beyond what the individual would otherwise pay for services received by such a specialist that is a participating provider. (b) Specialists as Gatekeeper for Treatment of Ongoing Special Conditions.-- (1) In general.--A group health plan, or a health insurance issuer, in connection with the provision of health insurance coverage, shall have a procedure by which an individual who is a participant, beneficiary, or enrollee and who has an ongoing special condition (as defined in paragraph (3)) may request and receive a referral to a specialist for such condition who shall be responsible for and capable of providing and coordinating the individual's care with respect to the condition. Under such procedures if such an individual's care would most appropriately be coordinated by such a specialist, such plan or issuer shall refer the individual to such specialist. (2) Treatment for related referrals.--Such specialists shall be permitted to treat the individual without a referral from the individual's primary care provider and may authorize such referrals, procedures, tests, and other medical services as the individual's primary care provider would otherwise be permitted to provide or authorize, subject to the terms of the treatment (referred to in subsection (a)(3)(A)) with respect to the ongoing special condition. (3) Ongoing special condition defined.--In this subsection, the term ``ongoing special condition'' means a condition or disease that-- (A) is life-threatening, degenerative, or disabling, and (B) requires specialized medical care over a prolonged period of time. (4) Terms of referral.--The provisions of paragraphs (3) through (5) of subsection (a) apply with respect to referrals under paragraph (1) of this subsection in the same manner as they apply to referrals under subsection (a)(1). (c) Standing Referrals.-- (1) In general.--A group health plan, and a health insurance issuer in connection with the provision of health insurance coverage, shall have a procedure by which an individual who is a participant, beneficiary, or enrollee and who has a condition that requires ongoing care from a specialist may receive a standing referral to such specialist for treatment of such condition. If the plan or issuer, or if the primary care provider in consultation with the medical director of the plan or issuer and the specialist (if any), determines that such a standing referral is appropriate, the plan or issuer shall make such a referral to such a specialist if the individual so desires. (2) Terms of referral.--The provisions of paragraphs (3) through (5) of subsection (a) apply with respect to referrals under paragraph (1) of this subsection in the same manner as they apply to referrals under subsection (a)(1). SEC. 115. ACCESS TO OBSTETRICAL AND GYNECOLOGICAL CARE. (a) In General.--If a group health plan, or a health insurance issuer in connection with the provision of health insurance coverage, requires or provides for a participant, beneficiary, or enrollee to designate a participating primary care health care professional, the plan or issuer-- (1) may not require authorization or a referral by the individual's primary care health care professional or otherwise for coverage of gynecological care (including preventive women's health examinations) and pregnancy-related services provided by a participating health care professional, including a physician, who specializes in obstetrics and gynecology to the extent such care is otherwise covered, and (2) shall treat the ordering of other obstetrical or gynecological care by such a participating professional as the authorization of the primary care health care professional with respect to such care under the plan or coverage. (b) Construction.--Nothing in subsection (a) shall be construed to-- (1) waive any exclusions of coverage under the terms of the plan or health insurance coverage with respect to coverage of obstetrical or gynecological care; or (2) preclude the group health plan or health insurance issuer involved from requiring that the obstetrical or gynecological provider notify the primary care health care professional or the plan or issuer of treatment decisions. SEC. 116. ACCESS TO PEDIATRIC CARE. (a) Pediatric Care.--If a group health plan, or a health insurance issuer in connection with the provision of health insurance coverage, requires or provides for an enrollee to designate a participating primary care provider for a child of such enrollee, the plan or issuer shall permit the enrollee to designate a physician who specializes in pediatrics as the child's primary care provider. (b) Construction.--Nothing in subsection (a) shall be construed to waive any exclusions of coverage under the terms of the plan or health insurance coverage with respect to coverage of pediatric care. SEC. 117. CONTINUITY OF CARE. (a) In General.-- (1) Termination of provider.--If a contract between a group health plan, or a health insurance issuer in connection with the provision of health insurance coverage, and a health care provider is terminated (as defined in paragraph (3)(B)), or benefits or coverage provided by a health care provider are terminated because of a change in the terms of provider participation in a group health plan, and an individual who is a participant, beneficiary, or enrollee in the plan or coverage is undergoing treatment from the provider for an ongoing special condition [[Page H9529]] (as defined in paragraph (3)(A)) at the time of such termination, the plan or issuer shall-- (A) notify the individual on a timely basis of such termination and of the right to elect continuation of coverage of treatment by the provider under thi