[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6703 Engrossed in House (EH)]
<DOC>
119th CONGRESS
1st Session
H. R. 6703
_______________________________________________________________________
AN ACT
To ensure access to affordable health insurance.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Lower Health Care Premiums for All
Americans Act''.
TITLE I--IMPROVING HEALTH CARE OPTIONS FOR WORKERS
SEC. 101. ASSOCIATION HEALTH PLANS.
(a) Treatment of Group or Association of Employers.--Section 3(5)
of the Employee Retirement Income Security Act of 1974 (29 U.S.C.
1002(5)) is amended by inserting after ``capacity'' the following:
``(including, for the purpose of establishing or maintaining a group
health plan, a group or association of employers that satisfies the
requirements of section 736(a))''.
(b) Rules Applicable to Group Health Plans Established and
Maintained by a Group or Association of Employers.--
(1) In general.--Part 7 of subtitle B of title I of the
Employee Retirement Income Security Act of 1974 (29 U.S.C.
1181, et seq.) is amended by adding at the end the following:
``SEC. 736. RULES APPLICABLE TO GROUP HEALTH PLANS ESTABLISHED AND
MAINTAINED BY A GROUP OR ASSOCIATION OF EMPLOYERS.
``(a) Association Health Plans.--A group or association of
employers may maintain a group health plan, regardless of whether the
employers composing such group or association are in the same industry,
trade, or profession, if such group or association satisfies the
following requirements:
``(1) Group or association requirements.--The group or
association of employers--
``(A) shall--
``(i) have been formed and maintained in
good faith for purposes other than providing
health insurance coverage through a group
health plan;
``(ii) establish a governing board or
another indicator of formality as described in
paragraph (2); and
``(iii) have existed for at least 2 years
prior to offering a group health plan to the
employees of such group or association; and
``(iv) make health insurance coverage under
the group health plan offered by such group or
association available--
``(I) to at least 51 employees; and
``(II) to all employees of the
employer members, and any dependents of
such employees;
``(B) may only provide health insurance coverage
through the group health plan of the group or
association--
``(i) to an employee of an employer member
of the group or association or a dependent of
such an employee; or
``(ii) as necessary to comply with part 6;
``(C) may include a health insurance issuer as an
employer member, except that the group or association
may not--
``(i) be a health insurance issuer; or
``(ii) be controlled or owned by a health
insurance issuer (or a subsidiary or affiliate
of a health insurance issuer).
``(D) may not condition the membership of an
employer in the group or association on any health
status-related factor (as described in section
702(a)(1)) relating to any employee or dependent of any
employee of any employer member.
``(2) Organizational requirements.--
``(A) Governing board or formal organization of the
group or association.--
``(i) In general.--The group or association
shall have--
``(I) a formal organizational
structure with a governing board and
by-laws; or
``(II) another structure or
indicator of formality.
``(ii) Requirement.--Both structures
described in subclauses (I) and (II) of clause
(i) shall comply with the requirements
described in subparagraph (B).
``(B) Formal organization structure of group or
association.--
``(i) In general.--The functions and
activities of the group or association shall be
controlled by the employer members in substance
and in fact.
``(ii) Control.--The control described in
clause (i) shall be satisfied so long as at
least 75 percent of the positions on the board
or other formal organizational structure are
held by employer members.
``(iii) Elections.--Each position of the
governing board or other formal organizational
structure shall be subject to scheduled
elections, as determined by the group or
association, and each employer-member shall be
able to cast only one vote in each such
election.
``(C) Group health plan requirements.--
``(i) Control.--The group health plan shall
be controlled in substance and in fact by
employer members participating in the group
health plan.
``(ii) Eligibility verification.--A plan
fiduciary shall verify, on a regular basis and
pursuant to reasonable monitoring procedures as
established by the plan fiduciary, whether an
individual is a self-employed individual if
such individual (or a beneficiary thereof)
participates in the group health plan on the
basis that such individual is a self-employed
individual.
``(iii) Ineligible self-employed
individuals.--
``(I) In general.--Subject to
subclause (II) and except as required
under part 6, in the case that the plan
fiduciary determines that an individual
who participates in the group health
plan no longer meets the requirements
under a self-employed individual during
a plan year, the group health plan
shall not make health insurance
coverage available to such individual
for any plan year following the plan
year in which such determination was
made.
``(II) Remedial action.--If, after
the plan fiduciary determines that an
individual described in clause (i) is
not a self-employed individual, the
individual furnishes to the plan
fiduciary evidence proving that such
individual is a self-employed
individual, such individual shall be
eligible to participate in the group
health plan.
``(3) Discrimination and pre-existing condition
protections.--A group health plan established and maintained by
the group or association of employers under this section may
not--
``(A) establish any rule for eligibility (including
continued eligibility) of any individual (including an
employee of an employer member or a self-employed
individual, or a dependent of such employee or self-
employed individual) to enroll for benefits under the
terms of the plan that discriminates based on any
health status-related factor that relates to such
individual (consistent with the rules under section
702(a)(1));
``(B) require an individual (including an employee
of an employer member or a self-employed individual, or
a dependent of such employee or self-employed
individual), as a condition of enrollment or continued
enrollment under the plan, to pay a premium or
contribution that is greater than the premium or
contribution for a similarly situated individual
enrolled in the plan based on any health status-related
factor that relates to such individual (consistent with
the rules under section 702(b)(1)); and
``(C) deny coverage under such plan on the basis of
a pre-existing condition (consistent with the rules
under section 2704 of the Public Health Service Act).
``(b) Premium Rates for a Group or Association of Employers.--
``(1) In general.--A group health plan established and
maintained by a group or association of employers that meets
that requirements of this section may, to the extent not
prohibited under State law--
``(A) establish base premium rates formed on an
actuarially sound, modified community rating
methodology that considers the pooling of all plan
participant claims; and
``(B) utilize the specific risk profile of each
employer member of such group or association to
determine contribution rates for each such employer
member's share of a premium by actuarially adjusting
the established base premium rates.
``(2) Only self employed individuals.--In the case that a
group or association is composed only of self-employed
individuals, the group health plan established by such group or
association shall--
``(A) treat all such self-employed individuals as a
single risk pool;
``(B) pool all plan participant claims; and
``(C) charge each plan participant the same premium
rate.
``(c) Treatment of Self-Employed Individuals.--For purposes of this
section, an individual who is a self-employed individual shall be
treated as--
``(1) an employer who may be a member of a group or
association of employers;
``(2) an employee who may participate in a group health
plan established and maintained by such group or association;
and
``(3) a participant of the group health plan in which the
individual participates, subject to the eligibility
determination and monitoring requirements set forth in
subsection (a)(2)(C)(i).
``(d) Determination of Employer or Joint Employer Status.--The
provision of health insurance coverage by a group or association of
employers may not be construed as evidence for establishing an employer
or joint employer relationship under any Federal or State law.
``(e) Rules of Construction.--
``(1) No exemption from phsa.--Nothing in this section
shall be construed to exempt a group health plan (as defined in
section 733(a)(1)) offered through a group or association of
employers from the requirements of this part or from the
provisions of part A of title XXVII of the Public Health
Service Act as incorporated by reference into this Act through
section 715.
``(2) Prior or future guidance.--Nothing in this section
may be construed to limit or otherwise affect the ability of a
group or association of employers from establishing a single
plan multiple employer welfare arrangement as specified in any
prior or future guidance issued by the Secretary of Labor that
provides alternative pathways to qualifying as a group or
association of employer for purposes of section 3(5).
``(f) Definitions.--In this section--
``(1) Employer member.--The term `employer member' means--
``(A) an employer who is a member of such group or
association of employers and employs at least 1 common
law employee; or
``(B) a group made up solely of self-employed
individuals, within which all of the self-employed
individual members of such group or association are
aggregated together as a single employer member group,
provided that such group includes at least 20 self-
employed individual members.
``(2) Self-employed individual.--The term `self-employed
individual' means an individual who--
``(A) does not have any common law employees;
``(B) has a bona fide ownership right in a trade or
business, regardless of whether such trade or business
is incorporated or unincorporated;
``(C) earns a wage (as defined in section 3121(a)
of the Internal Revenue Code of 1986) or self-
employment income (as defined in section 1402(b) of
such Code) from such trade or business; and
``(D) works at least 10 hours a week, or 40 hours
per month, providing personal services to such trade or
business.''.
(2) Clerical amendment.--The table of contents is amended
by inserting after the item relating to section 734 the
following:
``735. Standardized reporting format.
``736. Rules applicable to group health plans established and
maintained by a group or association of
employers.''.
SEC. 102. CERTAIN MEDICAL STOP-LOSS INSURANCE OBTAINED BY CERTAIN PLAN
SPONSORS OF GROUP HEALTH PLANS NOT INCLUDED UNDER THE
DEFINITION OF HEALTH INSURANCE COVERAGE.
(a) In General.--Section 733(b)(1) of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1191b(b)(1)) is amended by
adding at the end the following sentence: ``Such term shall not include
a stop-loss policy obtained by a self-insured group health plan or a
plan sponsor of a group health plan that self-insures the health risks
of its plan participants to reimburse the plan or sponsor for losses
that the plan or sponsor incurs in providing health or medical benefits
to such plan participants in excess of a predetermined level set forth
in the stop-loss policy obtained by such plan or sponsor.''.
(b) Effect on Other Laws.--Section 514(b) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1144(b)) is amended
by adding at the end the following:
``(10) The provisions of this title (including part 7 relating to
group health plans) shall preempt State laws insofar as they may now or
hereafter prevent an employee benefit plan that is a group health plan
from insuring against the risk of excess or unexpected health plan
claims losses.''.
SEC. 103. TREATMENT OF HEALTH REIMBURSEMENT ARRANGEMENTS INTEGRATED
WITH INDIVIDUAL MARKET COVERAGE.
(a) In General.--
(1) Treatment.--Section 9815(b) of the Internal Revenue
Code of 1986 is amended--
(A) by striking ``Exception.--Notwithstanding
subsection (a)'' and inserting the following:
``Exceptions.--
``(1) Self-insured group health plans.--Notwithstanding
subsection (a)'', and
(B) by adding at the end the following new
paragraph:
``(2) Custom health option and individual care expense
arrangements.--
``(A) In general.--For purposes of this subchapter,
a custom health option and individual care expense
arrangement shall be treated as meeting the
requirements of section 9802 and sections 2705, 2711,
2713, and 2715 of title XXVII of the Public Health
Service Act.
``(B) Custom health option and individual care
expense arrangements defined.--For purposes of this
section, the term `custom health option and individual
care expense arrangement' means a health reimbursement
arrangement--
``(i) which is an employer-provided group
health plan funded solely by employer
contributions to provide payments or
reimbursements for medical care subject to a
maximum fixed dollar amount for a period,
``(ii) under which such payments or
reimbursements may only be made for medical
care provided during periods during which the
individual is covered--
``(I) under individual health
insurance coverage (other than coverage
that consists solely of excepted
benefits), or
``(II) under part A and B of title
XVIII of the Social Security Act or
part C of such title,
``(iii) which meets the nondiscrimination
requirements of subparagraph (C),
``(iv) which meets the substantiation
requirements of subparagraph (D), and
``(v) which meets the notice requirements
of subparagraph (E).
``(C) Nondiscrimination.--
``(i) In general.--An arrangement meets the
requirements of this subparagraph if an
employer offering such arrangement to an
emp