Title V: QUALITY AND CONSUMER PROTECTION Table of contents Subtitle A. Quality Management and Improvement Section 5001. National Quality Management Program. Section 5002. National Quality Management Council. Section 5003. National measures of quality performance. Section 5004. Consumer surveys. Section 5005. Evaluation and reporting of quality performance. Section 5006. Development and dissemination of practice guidelines. Section 5007. Research on health care quality. Section 5008. Regional professional foundations. Section 5009. National Quality Consortium. Section 5010. Eliminating CLIA requirement for certificate of waiver for simple laboratory examinations and procedures. Section 5012. Role of alliances in quality assurance. Section 5013. Role of health plans in quality management. Subtitle B. Information Systems, Privacy, and Administrative Simplification Part 1. Health Information Systems Section 5101. Establishment of health information system. Section 5102. Additional requirements for health information system. Section 5103. Electronic data network. Section 5104. Unique identifier numbers. Section 5105. Health security cards. Section 5106. Technical assistance in the establishment of health information systems. Part 2. Privacy of Information Section 5120. Health information system privacy standards. Section 5121. Other duties with respect to privacy. Section 5122. Comprehensive health information privacy protection act. Section 5123. Definitions. Part 3. Interim Requirements for Administrative Simplification Section 5130. Standard benefit forms. Part 4. General Provisions Section 5140. National Privacy and Health Data Advisory Council. Section 5141. Civil money penalties. Section 5142. Relationship to other laws. Subtitle C. Remedies and Enforcement Part 1. Review of Benefit Determinations for Enrolled Individuals Subpart A. GENERAL RULES Section 5201. Health plan claims procedure. Section 5202. Review in regional alliance complaint review offices of grievances based on acts or practices by health plans. Section 5203. Initial proceedings in complaint review offices. Section 5204. Hearings before hearing officers in complaint review offices. Section 5205. Review by Federal Health Plan Review Board. Section 5206. Civil money penalties. Subpart B. EARLY RESOLUTION PROGRAMS Section 5211. Establishment of early resolution programs in complaint review offices. Section 5212. Initiation of participation in mediation proceedings. Section 5213. Mediation proceedings. Section 5214. Legal effect of participation in mediation proceedings. Section 5215. Enforcement of settlement agreements. Part 2. Additional Remedies and Enforcement Provisions Section 5231. Judicial review of Federal action on State systems. Section 5232. Administrative and judicial review relating to cost containment. Section 5233. Civil enforcement. Section 5234. Priority of certain bankruptcy claims. Section 5235. Private right to enforce State responsibilities. Section 5236. Private right to enforce Federal responsibilities in operating a system in a State. Section 5237. Private right to enforce responsibilities of alliances. Section 5238. Discrimination claims. Section 5239. Nondiscrimination in federally assisted programs. Section 5240. Civil action by essential community provider. Section 5241. Facial constitutional challenges. Section 5242. Treatment of plans as parties in civil actions. Section 5243. General nonpreemption of existing rights and remedies. Subtitle D. Medical Malpractice Part 1. Liability Reform Section 5301. Federal tort reform. Section 5302. Plan-based alternative dispute resolution mechanisms. Section 5303. Requirement for certificate of merit. Section 5304. Limitation on amount of attorney's contingency fees. Section 5305. Reduction of awards for recovery from collateral sources. Section 5306. Periodic payment of awards. Part 2. Other Provisions Relating to Medical Malpractice Liability Section 5311. Enterprise liability demonstration project. Section 5312. Pilot program applying practice guidelines to medical malpractice liability actions. Subtitle E. Fraud and Abuse Part 1. Establishment of All-payer Health Care Fraud and Abuse Control Program Section 5401. All-Payer Health Care Fraud and Abuse Control Program. Section 5402. Establishment of All-Payer Health Care Fraud and Abuse Control Account. Section 5403. Use of funds by Inspector General. Part 2. Application of Fraud and Abuse Authorities Under the Social Security Act to All Payers Section 5411. Exclusion from participation. Section 5412. Civil monetary penalties. Section 5413. Limitations on physician self-referral. Section 5414. Construction of Social Security Act references. Part 3. Amendments to Anti-fraud and Abuse Provisions Under the Social Security Act Section 5421. Reference to amendments. Part 4. Amendments to Criminal Law Section 5431. Health care fraud. Section 5432. Forfeitures for violations of fraud statutes. Section 5433. False statements. Section 5434. Bribery and graft. Section 5435. Injunctive relief relating to health care offenses. Section 5436. Grand jury disclosure. Section 5437. Theft or embezzlement. Section 5438. Misuse of health security card or unique identifier. Part 5. Amendments to Civil False Claims Act Section 5441. Amendments to Civil False Claims Act. Subtitle F. McCarran-Ferguson Reform Section 5501. Repeal of exemption for health insurance. -------- Subtitle A. Quality Management and Improvement SEC. 5001. NATIONAL QUALITY MANAGEMENT PROGRAM. Not later than 1 year after the date of the enactment of this Act, the National Health Board shall establish and oversee a performance-based program of quality management and improvement designed to enhance the quality, appropriateness, and effectiveness of health care services and access to such services. The program shall be known as the National Quality Management Program and shall be administered by the National Quality Management Council established under section 5002. SEC. 5002. NATIONAL QUALITY MANAGEMENT COUNCIL. (a) Establishment. There is established a council to be known as the National Quality Management Council. (b) Duties. The Council shall (1) administer the National Quality Management Program; (2) perform any other duty specified as a duty of the Council in this subtitle; and (3) advise the National Health Board with respect its duties under this subtitle. (c) Number and Appointment. The Council shall be composed of 15 members appointed by the President. The Council shall consist of members who are broadly representative of the population of the United States and shall include (1) individuals representing the interests of governmental and corporate purchasers of health care; (2) individuals representing the interests of health plans; (3) individuals representing the interests of States; (4) individuals representing the interests of health care providers and academic health centers (as defined in section 3101(c)); and (5) individuals distinguished in the fields of public health, health care quality, and related fields of health services research. (d) Terms. (1) In general. Except as provided in paragraph (2), members of the Council shall serve for a term of 3 years. (2) Staggered rotation. Of the members first appointed to the Council under subsection (c), the President shall appoint 5 members to serve for a term of 3 years, 5 members to serve for a term of 2 years, and 5 members to serve for a term of 1 year. (3) Service beyond term. A member of the Council may continue to serve after the expiration of the term of the member until a successor is appointed. (e) Vacancies. If a member of the Council does not serve the full term applicable under subsection (d), the individual appointed to fill the resulting vacancy shall be appointed for the remainder of the term of the predecessor of the individual. (f) Chair. The President shall designate an individual to serve as the chair of the Council. (g) Meetings. The Council shall meet not less than once during each discrete 4-month period and shall otherwise meet at the call of the President or the chair. (h) Compensation and Reimbursement of Expenses. Members of the Council shall receive compensation for each day (including travel time) engaged in carrying out the duties of the Council. Such compensation may not be in an amount in excess of the maximum rate of basic pay payable for level IV of the Executive Schedule under section 5315 of title 5, United States Code. (i) Staff. The National Health Board shall provide to the Council such staff, information, and other assistance as may be necessary to carry out the duties of the Council. (j) Health Care Provider. For purposes of this subtitle, the term ``health care provider'' means an individual who, or entity that, provides an item or service to an individual that is covered under the health plan (as defined in section 1400) in which the individual is enrolled. SEC. 5003. NATIONAL MEASURES OF QUALITY PERFORMANCE. (a) In General. The National Quality Management Council shall develop a set of national measures of quality performance, which shall be used to assess the provision of health care services and access to such services. (b) Subject of Measures. National measures of quality performance shall be selected in a manner that provides information on the following subjects: (1) Access to health care services by consumers. (2) Appropriateness of health care services provided to consumers. (3) Outcomes of health care services and procedures. (4) Health promotion. (5) Prevention of diseases, disorders, and other health conditions. (6) Consumer satisfaction with care. (c) Selection of Measures. (1) Consultation. In developing and selecting the national measures of quality performance, the National Quality Management Council shall consult with appropriate interested parties, including (A) States; (B) health plans; (C) employers and individuals purchasing health care through regional and corporate alliances; (D) health care providers; (E) the National Quality Consortium established under section 5009; (F) individuals distinguished in the fields of law, medicine, economics, public health, and health services research; (G) the Administrator for Health Care Policy and Research; (H) the Director of the National Institutes of Health; and (I) the Administrator of the Health Care Financing Administration. (2) Criteria. The following criteria shall be used in developing and selecting national measures of quality performance: (A) Significance. When a measure relates to a specific disease, disorder, or other health condition, the disease, disorder, or condition shall be of significance in terms of prevalence, morbidity, mortality, or the costs associated with the prevention, diagnosis, treatment, or clinical management of the disease, disorder, or condition. (B) Range of services. The set of measures, taken as a whole, shall be representative of the range of services provided to consumers of health care by the individuals and entities described in subsection (a). (C) Reliability and validity. The measures shall be reliable and valid. (D) Undue burden. The data needed to calculate the measures shall be obtained without undue burden on the entity or individual providing the data. (E) Variation. Performance with respect to measures that are applicable to each category of individual or entity described in subsection (a) shall be expected to vary widely among individuals or entities in the category. (F) Linkage to health outcome. When a measure is a rate of a process of care, the process shall be linked to a health outcome based upon the best available scientific evidence. (G) Provider control and risk adjustment. When a measure is an outcome of the provision of care, the outcome shall be within the control of the provider and one with respect to which an adequate risk adjustment can be made. (H) Public health. The measures may incorporate standards identified by the Secretary of Health and Human Services for meeting public health objectives. (d) Updating. The National Quality Management Council shall review and update the set of national measures of quality performance annually to reflect changing goals for quality improvement. The Board shall establish and maintain a priority list of performance measures that within a 5-year period it intends to consider for inclusion within the set through the updating process. SEC. 5004. CONSUMER SURVEYS. (a) In General. The National Quality Management Council shall conduct periodic surveys of health care consumers to gather information concerning access to care, use of health services, health outcomes, and patient satisfaction. The surveys shall monitor consumer reaction to the implementation of this Act and be designed to assess the impact of this Act on the general population of the United States and potentially vulnerable populations. (b) Survey Administration. The National Quality Management Council shall develop and approve a standard design for the surveys, which shall be administered by the Administrator for Health Care Policy and Research on a plan-by-plan and State-by-State basis. A State may add survey questions on quality measures of local interest to surveys conducted in the State. (c) Sampling Strategies. The National Quality Management Council shall develop sampling strategies that ensure that survey samples adequately measure populations that are considered to be at risk of receiving inadequate health care and may be difficult to reach through consumer-sampling methods, including individuals who (1) fail to enroll in a health plan; (2) resign from a plan; or (3) are members of a vulnerable population. SEC. 5005. EVALUATION AND REPORTING OF QUALITY PERFORMANCE. (a) National Goals. In subject matter areas with respect to which the National Quality Management Council determines that sufficient information and consensus exist, the Council will recommend to the Board that it establish goals for performance by health plans and health care providers on a subset of the set of national measures of quality performance. (b) Impact of Reform. The National Quality Management Council shall evaluate the impact of the implementation of this Act on the quality of health care services in the United States and the access of consumers to such services. (c) Performance Reports. (1) Alliance and health plan reports. Each health alliance annually shall publish and make available to the public a performance report outlining in a standard format the performance of each health plan offered in the alliance on the set of national measures of quality performance. The report shall include the results of a smaller number of such measures for health care providers who are members of provider networks of such plans (as defined in section 1402(f)), if the available information is statistically meaningful. The report also shall include the results of consumer surveys described in section 5004 that were conducted in the alliance during the year that is the subject of the report. (2) National quality reports. The National Quality Management Council annually shall provide to the Congress and to each health alliance a report that (A) outlines in a standard format the performance of each regional alliance, corporate alliance, and health plan; (B) discusses State-level and national trends relating to health care quality; and (C) presents data for each health alliance from consumer surveys described in section 5004 that were conducted during the year that is the subject of the report. SEC. 5006. DEVELOPMENT AND DISSEMINATION OF PRACTICE GUIDELINES. (a) Development of Guidelines. (1) In general. The National Quality Management Council shall direct the Administrator for Health Care Policy and Research to develop and periodically review and update clinically relevant guidelines that may be used by health care providers to assist in determining how diseases, disorders, and other health conditions can most effectively and appropriately be prevented, diagnosed, treated, and managed clinically. (2) Certain Requirements. Guidelines under paragraph (1) shall (A) be based on the best available research and professional judgment regarding the effectiveness and appropriateness of health care services and procedures; (B) be presented in formats appropriate for use by health care providers, medical educators, medical review organizations, and consumers of health care; (C) include treatment-specific or condition-specific practice guidelines for clinical treatments and conditions in forms appropriate for use in clinical practice, for use in educational programs, and for use in reviewing quality and appropriateness of medical care; (D) include information on risks and benefits of alternative strategies for prevention, diagnosis, treatment, and management of a given disease, disorder, or other health condition; (E) include information on the costs of alternative strategies for the prevention, diagnosis, treatment, and management of a given disease, disorder, or other health condition, where cost information is available and reliable; and (F) be developed in accordance with priorities that shall be established by the National Quality Management Council based on the research priorities that are established under section 5007(b) and the 5-year priority list of performance measures described in section 5003(d). (3) Health service utilization protocols. The National Quality Management Council shall establish standards and procedures for evaluating the clinical appropriateness of protocols used to manage health service utilization. (4) Use in medical malpractice liability pilot program. Guidelines developed under this subsection may be used by the Secretary of Health and Human Services in the pilot program applying practice guidelines to medical malpractice liability under section 5312. (b) Evaluation and Certification of Other Guidelines. (1) Methodology. The National Quality Management Council shall direct the Administrator for Health Care Policy and Research to develop and publish standards relating to methodologies for developing the types of guidelines described in subsection (a)(1). (2) Evaluation and certification. The National Quality Management Council shall direct the Administrator for Health Care Policy and Research to establish a procedure by which individuals and entities may submit guidelines of the type described in subsection (a)(1) to the Council for evaluation and certification by the Council using the standards developed under paragraph (1). (3) Use in medical malpractice liability pilot program. Guidelines certified under paragraph (2) may be used by the Secretary of Health and Human Services in the pilot program applying practice guidelines to medical malpractice liability under section 5312. (c) Guideline Clearinghouse. The National Quality Management Council shall direct the Administrator for Health Care Policy and Research to establish and oversee a clearinghouse and dissemination program for practice guidelines that are developed or certified under this section. (d) Dissemination of information on ineffective treatments. The National Quality Management Council shall disseminate information documenting clinically ineffective treatments and procedures. SEC. 5007. RESEARCH ON HEALTH CARE QUALITY. (a) Research Support. The National Quality Management Council shall direct the Administrator for Health Care Policy and Research to support research directly related to the 5-year priority list of performance measures described in section 5003(d), including research with respect to (1) outcomes of health care services and procedures; (2) effective and efficient dissemination of information, standards, and guidelines; (3) methods of measuring quality and shared decisionmaking; and (4) design and organization of quality of care components of automated health information systems. (b) Research Priorities. The National Quality Management Council shall establish priorities for research with respect to the quality, appropriateness, and effectiveness of health care and make recommendations concerning research projects. In establishing the priorities, the National Quality Management Council shall emphasize research involving diseases, disorders, and health conditions as to which (1) there is the highest level of uncertainty concerning treatment; (2) there is the widest variation in practice patterns; (3) the costs associated with prevention, diagnosis, treatment, or clinical management are significant; and (4) the rate of incidence or prevalence is high for the population as a whole or for particular subpopulations. SEC. 5008. REGIONAL PROFESSIONAL FOUNDATIONS. (a) Establishment. The National Health Board shall establish and oversee regional professional foundations to perform the duties specified in subsection (c). (b) Structure and Membership. (1) In general. The National Quality Consortium established under section 5009 shall oversee the establishment of regional professional foundations, the membership requirements for each foundation, and any other requirement for the internal operation of each foundation. (2) Entities eligible for membership. Each regional professional foundation shall include at least one academic health center (as defined in section 3101(c)). The following entities also shall be eligible to serve as members of the regional professional foundation for the region in which the entity is located: (A) Schools of public health (as defined in section 799 of the Public Health Service Act). (B) Other schools and programs defined in such section. (C) Health plans. (D) Regional alliances. (E) Corporate alliances. (F) Health care providers. (c) Duties. A regional professional foundation shall carry out the following duties for the region in which the foundation is located (such region to be demarcated by the National Health Board with the advice of the National Quality Consortium established under section 5009): (1) Developing programs in lifetime learning for health professionals (as defined in section 1112(c)(1)) to ensure the delivery of quality health care. (2) Fostering collaboration among health plans and health care providers to improve the quality of primary and specialized health care. (3) Disseminating information about successful quality improvement programs, practice guidelines, and research findings. (4) Disseminating information on innovative uses of health professionals. (5) Developing innovative patient education systems that enhance patient involvement in decisions relating their health care. (6) Applying for and conducting research described in section 5007. (d) Programs in Lifetime Learning. The programs described in subsection (c)(1) shall ensure that health professionals remain abreast of new knowledge, acquire new skills, and adopt new roles as technology and societal demands change. SEC. 5009. NATIONAL QUALITY CONSORTIUM. (a) Establishment. The National Health Board shall establish a consortium to be known as the National Quality Consortium. (b) Duties. The Consortium shall (1) establish programs for continuing education for health professionals; (2) advise the National Quality Management Council and the Administrator for Health Care Policy and Research on research priorities; (3) oversee the development of the regional professional foundations established under section 5008; (4) advise the National Quality Management Council with respect to the funding of proposals to establish such foundations; (5) consult with the National Quality Management Council regarding the selection of national measures of quality performance under section 5003(c); and (6) advise the National Health Board and the National Quality Management Council with respect to any other duty of the Board or the Council under this subtitle. (c) Membership. The Consortium shall be composed of 11 members appointed by the National Health Board. The members of the Consortium shall include (1) 5 individuals representing the interests of academic health centers; and (2) 6 other individuals representing the interests of one of the following persons: (A) Schools of public health. (B) Other schools and programs defined in section 799 of the Public Health Service Act (including medical schools, nursing schools, and allied health professional schools). (d) Terms. (1) In general. Except as provided in paragraph (2), members of the Consortium shall serve for a term of 3 years. (2) Staggered rotation. Of the members first appointed to the Consortium under subsection (c), the National Health Board shall appoint 4 members to serve for a term of 3 years, 3 members to serve for a term of 2 years, and 4 members to serve for a term of 1 year. (e) Chair. The National Health Board shall designate an individual to serve as the chair of the Consortium. SEC. 5010. ELIMINATING CLIA REQUIREMENT FOR CERTIFICATE OF WAIVER FOR SIMPLE LABORATORY EXAMINATIONS AND PROCEDURES. (a) In General. Section 353 of the Public Health Service Act (42 U.S.C. 263a) is amended (1) in subsection (b), by inserting before the period at the end the following: ``or unless the laboratory is exempt from the certificate requirement under subsection (d)(2)''; (2) by amending paragraph (2) of subsection (d) to read as follows: ``(2) Exemption from certificate requirement for laboratories performing only simple examinations and procedures. A laboratory which performs only laboratory examinations and procedures described in paragraph (3) is not required to have in effect a certificate under this section.''; and (3) by striking paragraph (4) of subsection (d). (b) Effective Date. The amendments made by this section shall take effect on the first day of the first month beginning after the date of the enactment of this Act. SEC. 5012. ROLE OF ALLIANCES IN QUALITY ASSURANCE. Each regional alliance and each corporate alliance shall (1) disseminate to consumers information related to quality and access to aid in their selection of plans in accordance with section 1325; (2) disseminate information on the quality of health plans and health care providers contained in reports of the National Quality Management Council section 5005(d); (3) ensure through negotiations with health plans that performance and quality standards are continually improved; and (4) conduct educational programs in cooperation with regional quality foundations to assist consumers in using quality and other information in choosing health plans. SEC. 5013. ROLE OF HEALTH PLANS IN QUALITY MANAGEMENT. Each health plan shall (1) measure and disclose performance on quality measures used by (A) participating States in which the plan does business; (B) regional alliances and corporate alliances that offer the plan; and (C) the National Quality Management Council; (2) furnish information required under subtitle B of this title and provide such other reports and information on the quality of care delivered by health care providers who are members of a provider network of the plan (as defined in section 1402(f)) as may be required under this Act; and (3) maintain quality management systems that (A) use the national measures of quality performance developed by the National Quality Management Council under section 5003; and (B) measure the quality of health care furnished to enrollees under the plan by all health care providers who are members of a provider network of the plan. Subtitle B. Information Systems, Privacy, and Administrative Simplification Part 1. HEALTH INFORMATION SYSTEMS SEC. 5101. ESTABLISHMENT OF HEALTH INFORMATION SYSTEM. (a) In General. Not later than 2 years after the date of the enactment of this Act, the National Health Board shall develop and implement a health information system by which the Board shall collect, report, and regulate the collection and dissemination of the health care information described in subsection (e) pursuant to standards promulgated by the Board and (if applicable) consistent with policies established as part of the National Information Infrastructure Act of 1993. (b) Privacy. The health information system shall be developed and implemented in a manner that is consistent with the privacy and security standards established under section 5120. (c) Reduction in Administrative Costs. The health information system shall be developed and implemented in a manner that is consistent with the objectives of reducing wherever practicable and appropriate (1) the costs of providing and paying for health care; (2) the time, effort, and financial resources expended by persons to provide information to States and the Federal Government. (d) Uses of Information. The health care information described in subsection (e) shall be collected and reported in a manner that facilitates its use for the following purposes: (1) Health care planning, policy development, policy evaluation, and research by Federal, State, and local governments and regional and corporate alliances. (2) Establishing and monitoring payments for health services by the Federal Government, States, regional alliances, and corporate alliances. (3) Assessing and improving the quality of health care. (4) Measuring and optimizing access to health care. (5) Evaluating the cost of specific clinical or administrative functions. (6) Supporting public health functions and objectives. (7) Improving the ability of health plans, health care providers, and consumers to coordinate, improve, and make choices about health care. (8) Managing and containing costs at the alliance and plan levels. (e) Health Care Information. The health care information referred to in subsection (a) shall include data on (1) enrollment and disenrollment in health plans; (2) clinical encounters and other items and services provided by health care providers; (3) administrative and financial transactions and activities of participating States, regional alliances, corporate alliances, health plans, health care providers, employers, and individuals that are necessary to determine compliance with this Act or an Act amended by this Act; (4) the characteristics of regional alliances, including the number, and demographic characteristics of eligible individuals residing in each alliance area; (5) the characteristics of corporate alliances, including the number, and demographic characteristics of individuals who are eligible to be enrolled in each corporate alliance health plan and individuals with respect to whom a large employer has exercised an option under section 1311 to make ineligible for such enrollment; (6) terms of agreement between health plans and the health care providers who are members of provider networks of the plans (as defined in section 1402(f)); (7) payment of benefits in cases in which benefits may be payable under a health plan and any other insurance policy or health program; (8) utilization management by health plans and health care providers; (9) the information collected and reported by the Board or disseminated by other individuals or entities as part of the National Quality Management Program under subtitle A; (10) grievances filed against regional alliances, corporate alliances, and health plans and the resolutions of such grievances; and (11) any other fact that may be necessary to determine whether a health plan or a health care provider has complied with a Federal statute pertaining to fraud or misrepresentation in the provision or purchasing of health care or in the submission of a claim for benefits or payment under a health plan. SEC. 5102. ADDITIONAL REQUIREMENTS FOR HEALTH INFORMATION SYSTEM. (a) Consultation. The health information system shall be developed in consultation with (1) Federal agencies that (A) collect health care information; (B) oversee the collection of information or records management by other Federal agencies; (C) directly provide health care services; (D) provide for payments for health care services; or (E) enforce a provision of this Act or any Act amended by this Act; (2) the National Quality Management Council established under section 5002; (3) participating States; (4) regional alliances and corporate alliances; (5) health plans; (6) representatives of health care providers; (7) representatives of employers; (8) representatives of consumers of health care; (9) experts in public health and health care information and technology; and (10) representatives of organizations furnishing health care supplies, services, and equipment. (b) Collection and Transmission Requirements. In establishing standards under section 5101, the National Health Board shall specify the form and manner in which individuals and entities are required to collect or transmit health care information for or to the Board. The Board also shall specify the frequency with which individuals and entities are required to transmit such information to the Board. Such specifications shall include, to the extent practicable (1) requirements for use of uniform paper forms containing standard data elements, definitions, and instructions for completion in cases where the collection or transmission of data in electronic form is not specified by the Board; (2) requirements for use of uniform health data sets with common definitions to standardize the collection and transmission of data in electronic form; (3) uniform presentation requirements for data in electronic form; and (4) electronic data interchange requirements for the exchange of data among automated health information systems. (c) Preemption of State ``Pen & Quill'' Laws. A standard established by the National Health Board relating to the form in which medical or health plan records are required to be maintained shall supercede any contrary provision of State law, except where the Board determines that the provision is necessary to prevent fraud and abuse, with respect to controlled substances, or for other purposes. SEC. 5103. ELECTRONIC DATA NETWORK. (a) In General. As part of the health information system, the National Health Board shall oversee the establishment of an electronic data network consisting of regional centers that collect, compile, and transmit information. (b) Consultation. The electronic data network shall be developed in consultation with (1) Federal agencies that (A) collect health care information; (B) oversee the collection of information or records management by other Federal agencies; (C) directly provide health care services; (D) provide for payments for health care services; or (E) enforce a provision of this Act or any Act amended by this Act; (2) the National Quality Management Council established under section 5002; (3) participating States; (4) regional alliances and corporate alliances; and (5) health plans. (c) Demonstration Projects. The electronic data network shall be tested prior to full implementation through the establishment of demonstration projects. (d) Disclosure of Individually Identifiable Information. The electronic data network may be used to disclose individually identifiable health information (as defined in section 5123(3)) to any individual or entity only in accordance with the health information system privacy standards promulgated by the National Health Board under section 5120. SEC. 5104. UNIQUE IDENTIFIER NUMBERS. (a) In General. As part of the health information system, the Board shall establish a system to provide for a unique identifier number for each (1) eligible individual; (2) employer; (3) health plan; and (4) health care provider. (b) Impermissible Data Links. In establishing the system under subsection (a), the National Health Board shall ensure that a unique identifier number may not be used to connect individually identifiable health information (as defined in section 5123(3)) that is collected as part of the health information system or that otherwise may be accessed through the number with individually identifiable information from any other source, except in cases where the National Health Board determines that such connection is necessary to carry out a duty imposed on any individual or entity under this Act. (c) Permissible Uses of Identifier. The National Health Board shall by regulation establish the purposes for which a unique identifier number provided pursuant to this section may be used. SEC. 5105. HEALTH SECURITY CARDS. (a) Permissible Uses of Card. A health security card that is issued to an eligible individual under section 1001(b) may be used by an individual or entity, in accordance with regulations promulgated by the Board, only for the purpose of providing or assisting the eligible individual in obtaining an item or service that is covered under (1) the applicable health plan in which the individual is enrolled (as defined in section 1902); (2) a policy consisting of a supplemental health benefit policy (described in part 2 of subtitle E of title I), a cost sharing policy (described in such part), or both; (3) a FEHBP supplemental plan (described in subtitle C of title VIII); (4) a FEHBP medicare supplemental plan (described in such subtitle); or (5) such other programs as the Board may specify. (b) Form of Card and Encoded Information. The National Health Board shall establish standards respecting the form of health security cards and the information to be encoded in electronic form on the cards. Such information shall include (1) the identity of the individual to whom the card is issued; (2) the applicable health plan in which the individual is enrolled; (3) any policy described in paragraph (2), (3), or (4) of subsection (a) in which the individual is enrolled; and (4) any other information that the National Health Board determines to be necessary in order for the card to serve the purpose described in subsection (a). (c) Unique Identifier Numbers. The unique identifier number system developed by the National Health Board under section 5104 shall be used in encoding the information described in subsection (b). (d) Registration of Card. The Board shall take appropriate steps to register the card, the name of the card, and other indicia relating to the card as a trademark or service mark (as appropriate) under the Trademark Act of 1946. For purposes of this subsection, the ``Trademark Act of 1946'' refers to the Act entitled ``An Act to provide for the registration and protection of trademarks used in commerce, to carry out the provisions of international conventions, and for other purposes'', approved July 5, 1946 (15 U.S.C. et seq.). (e) Reference to Crime. For a provision relating to criminal penalties for misuse of a health security card or a unique identifier number, see section 5438. SEC. 5106. TECHNICAL ASSISTANCE IN THE ESTABLISHMENT OF HEALTH INFORMATION SYSTEMS. The National Health Board shall provide information and technical assistance to participating States, regional alliances, corporate alliances, health plans, and health care providers with respect to the establishment and operation of automated health information systems. Such assistance shall focus on (1) the promotion of community-based health information systems; and (2) the promotion of patient care information systems that collect data at the point of care or as a by-product of the delivery of care. Part 2. PRIVACY OF INFORMATION SEC. 5120. HEALTH INFORMATION SYSTEM PRIVACY STANDARDS. (a) Health Information System Standards. Not later than 2 years after the date of the enactment of this Act, the National Health Board shall promulgate standards respecting the privacy of individually identifiable health information that is in the health information system described in part 1 of this subtitle. Such standards shall include standards concerning safeguards for the security of such information. The Board shall develop and periodically revise the standards in consultation with (1) Federal agencies that (A) collect health care information; (B) oversee the collection of information or records management by other Federal agencies; (C) directly provide health care services; (D) provide for payments for health care services; or (E) enforce a provision of this Act or any Act amended by this Act; (2) the National Quality Management Council established under section 5002; (3) participating States; (4) regional alliances and corporate alliances; (5) health plans; and (6) representatives of consumers of health care. (b) Information Covered. The standards established under subsection (a) shall apply to individually identifiable health information collected for or by, reported to or by, or the dissemination of which is regulated by, the National Health Board under section 5101. (c) Principles. The standards established under subsection (a) shall incorporate the following principles: (1) Unauthorized Disclosure. All disclosures of individually identifiable health information by an individual or entity shall be unauthorized unless (A) the disclosure is by the enrollee identified in the information or whose identity can be associated with the information; (B) the disclosure is authorized by such enrollee in writing in a manner prescribed by the Board; (C) the disclosure is to Federal, State, or local law enforcement agencies for the purpose of enforcing this Act or an Act amended by this Act; or (D) the disclosure otherwise is consistent with this Act and specific criteria governing disclosure established by the Board. (2) Minimal disclosure. All disclosures of individually identifiable health information shall be restricted to the minimum amount of information necessary to accomplish the purpose for which the information is being disclosed. (3) Risk adjustment. No individually identifiable health information may be provided by a health plan to a regional alliance or a corporate alliance for the purpose of setting premiums based on risk adjustment factors. (4) Required safeguards. Any individual or entity who maintains, uses, or disseminates individually identifiable health information shall implement administrative, technical, and physical safeguards for the security of such information. (5) Right to know. An enrollee (or an enrollee representative of the enrollee) has the right to know (A) whether any individual or entity uses or maintains individually identifiable health information concerning the enrollee; and (B) for what purposes the information may be used or maintained. (6) Right to access. Subject to appropriate procedures, an enrollee (or an enrollee representative of the enrollee) has the right, with respect to individually identifiable health information concerning the enrollee that is recorded in any form or medium (A) to see such information; (B) to copy such information; and (C) to have a notation made with or in such information of any amendment or correction of such information requested by the enrollee or enrollee representative. (7) Right to notice. An enrollee and an enrollee representative have the right to receive a written statement concerning (A) the purposes for which individually identifiable health information provided to a health care provider, a health plan, a regional alliance, a corporate alliance, or the National Health Board may be used or disclosed by, or disclosed to, any individual or entity; and (B) the right of access described in paragraph (6). (8) Use of Unique Identifier. When individually identifiable health information concerning an enrollee is required to accomplish the purpose for which information is being transmitted between or among the National Health Board, regional and corporate alliances, health plans, and health care providers, the transmissions shall use the unique identifier number provided to the enrollee pursuant to section 5104 in lieu of the name of the enrollee. (9) Use for Employment Decisions. Individually identifiable health care information may not be used in making employment decisions. SEC. 5121. OTHER DUTIES WITH RESPECT TO PRIVACY. (a) Research and Technical Support. The National Health Board may sponsor (1) research relating to the privacy and security of individually identifiable health information; (2) the development of consent forms governing disclosure of such information; and (3) the development of technology to implement standards regarding such information. (c) Education. The National Health Board shall establish education and awareness programs (1) to foster adequate security practices by States, regional alliances, corporate alliances, health plans, and health care providers; (2) to train personnel of public and private entities who have access to individually identifiable health information respecting the duties of such personnel with respect to such information; and (3) to inform individuals and employers who purchase health care respecting their rights with respect to such information. SEC. 5122. COMPREHENSIVE HEALTH INFORMATION PRIVACY PROTECTION ACT. (a) In General. Not later than 3 years after the date of the enactment of this Act, the National Health Board shall submit to the President and the Congress a detailed proposal for legislation to provide a comprehensive scheme of Federal privacy protection for individually identifiable health information. (b) Code of Fair Information Practices. The proposal shall include a Code of Fair Information Practices to be used to advise enrollees to whom individually identifiable health information pertains of their rights with respect to such information in an easily understood and useful form. (c) Enforcement. The proposal shall include provisions to enforce effectively the rights and duties that would be created by the legislation. SEC. 5123. DEFINITIONS. For purposes of this part: (1) Enrollee. The term ``enrollee'' means an individual who enrolls or has enrolled under a health plan. The term includes a deceased individual who was enrolled under a health plan. (2) Enrollee representative. The term ``enrollee representative'' means any individual legally empowered to make decisions concerning the provision of health care to an enrollee or the administrator or executor of the estate of a deceased enrollee. (3) Individually identifiable health information. The term ``individually identifiable health information'' means any information, whether oral or recorded in any form or medium, that (A) identifies or can readily be associated with the identity of an enrollee; and (B) relates to (i) the past, present, or future physical or mental health of the enrollee; (ii) the provision of health care to the enrollee; or (iii) payment for the provision of health care to the enrollee. Part 3. INTERIM REQUIREMENTS FOR ADMINISTRATIVE SIMPLIFICATION SEC. 5130. STANDARD BENEFIT FORMS. (a) Development. Not later than 1 year after the date of the enactment of this Act, the National Health Board shall develop, promulgate, and publish in the Federal Register the following standard health care benefit forms: (1) An enrollment and disenrollment form to be used to record enrollment and disenrollment in a health benefit plan. (2) A clinical encounter record to be used by health benefit plans and health service providers. (3) A claim form to be used in the submission of claims for benefits or payment under a health benefit plan. (b) Instructions, Definitions, and Codes. Each standard form developed under subsection (a) shall include instructions for completing the form that (1) specifically define, to the extent practicable, the data elements contained in the form; and (2) standardize any codes or data sets to be used in completing the form. (c) Requirements for Adoption of Forms. (1) Health Service Providers. On or after the date that is 270 days after the publication of the standard forms developed under subsection (a), a health service provider that furnishes items or services in the United States for which payment may be made under a health benefit plan may not (A) maintain records of clinical encounters involving such items or services that are required to be maintained by the National Health Board in a paper form that is not the clinical encounter record promulgated by the Board; or (B) submit any claim for benefits or payment for such services to such plan in a paper form that is not the claim form promulgated by the National Health Board. (2) Health Benefit Plans. On or after the date that is 270 days after the publication of the standard forms developed under subsection (a), a health benefit plan may not (A) record enrollment and disenrollment in a paper form that is not the enrollment and disenrollment form promulgated by the National Health Board; (B) maintain records of clinical encounters that are required to be maintained by the National Health Board in a paper form that is not the clinical encounter record promulgated by the Board; or (C) reject a claim for benefits or payment under the plan on the basis of the form or manner in which the claim is submitted if (i) the claim is submitted on the claim form promulgated by the National Health Board; and (ii) the plan accepts claims submitted in paper form. (d) Definitions. For purposes of this subtitle: (1) Health Benefit Plan. (A) In general. The term ``health benefit plan'' means, except as provided in subparagraphs (B) through (D), any public or private entity or program that provides for payments for health care services, including (i) a group health plan (as defined in section 5000(b)(1) of the Internal Revenue Code of 1986); and (ii) any other health insurance arrangement, including any arrangement consisting of a hospital or medical expense incurred policy or certificate, hospital or medical service plan contract, or health maintenance organization subscriber contract. (B) Plans excluded. Such term does not include (i) accident-only, credit, or disability income insurance; (ii) coverage issued as a supplement to liability insurance; (iii) an individual making payment on the individual's own behalf (or on behalf of a relative or other individual) for deductibles, coinsurance, or services not covered under a health benefit plan; and (iv) such other plans as the National Health Board may determine, because of the limitation of benefits to a single type or kind of health care, such as dental services or hospital indemnity plans, or other reasons should not be subject to the requirements of this section. (C) Plans included. Such term includes (i) workers compensation or similar insurance insofar as it relates to workers compensation medical benefits (as defined in section 10000(3)) provided by or through health plans; and (ii) automobile medical insurance insofar as it relates to automobile insurance medical benefits (as defined in section 10100(2)) provided by or through health plans. (D) Treatment of direct provision of services. Such term does not include a Federal or State program that provides directly for the provision of health services to beneficiaries. (2) Health service provider. The term ``health service provider'' includes a provider of services (as defined in section 1861(u) of the Social Security Act), physician, supplier, and other person furnishing health care services. Such term includes a Federal or State program that provides directly for the provision of health services to beneficiaries. (e) Interim Nature of Requirements. The National Health Board may modify, update, or supercede any standard form or requirement developed, promulgated, or imposed under this section through the establishment of a standard under section 5101. Part 4. GENERAL PROVISIONS SEC. 5140. NATIONAL PRIVACY AND HEALTH DATA ADVISORY COUNCIL. (a) Establishment. There is established an advisory council to be known as the National Privacy and Health Data Advisory Council. (b) Duties. The Council shall advise the National Health Board with respect its duties under this subtitle. (c) Number and Appointment. The Council shall be composed of 15 members appointed by the National Health Board. The members of the Council shall include (1) individuals representing the interests of consumers, employers, and other purchasers of health care; (2) individuals representing the interests of health plans, health care providers, corporate alliances, regional alliances, public health agencies, and participating States; and (3) individuals distinguished in the fields of data collection, data protection and privacy, law, ethics, medical and health services research, public health, and civil liberties and patient advocacy. (d) Terms. (1) In general. Except as provided in paragraph (2), members of the Council shall serve for a term of 3 years. (2) Staggered rotation. Of the members first appointed to the Council under subsection (c), the National Health Board shall appoint 5 members to serve for a term of 3 years, 5 members to serve for a term of 2 years, and 5 members to serve for a term of 1 year. (3) Service beyond term. A member of the Council may continue to serve after the expiration of the term of the member until a successor is appointed. (e) Vacancies. If a member of the Council does not serve the full term applicable under subsection (d), the individual appointed to fill the resulting vacancy shall be appointed for the remainder of the term of the predecessor of the individual. (f) Chair. The National Health Board shall designate an individual to serve as the chair of the Council. (g) Meetings. The Council shall meet not less than once during each discrete 4-month period and shall otherwise meet at the call of the National Health Board or the chair. (h) Compensation and Reimbursement of Expenses. Members of the Council shall receive compensation for each day (including travel time) engaged in carrying out the duties of the Council. Such compensation may not be in an amount in excess of the maximum rate of basic pay payable for level IV of the Executive Schedule under section 5315 of title 5, United States Code. (i) Staff. The National Health Board shall provide to the Council such staff, information, and other assistance as may be necessary to carry out the duties of the Council. (j) Duration. Notwithstanding section 14(a) of the Federal Advisory Committee Act, the Council shall continue in existence until otherwise provided by law. SEC. 5141. CIVIL MONEY PENALTIES. (a) Violation of Health Information System Standards. Any person who the Secretary of Health and Human Services determines (1) is required, but has substantially failed, to comply with a standard established by the National Health Board under section 5101 or 5120; (2) has required the display of, has required the use of, or has used a health security card for any purpose other than a purpose described in section 5105(a); or (3) has required the disclosure of, has required the use of, or has used a unique identifier number provided pursuant to section 5104 for any purpose that is not authorized by the National Health Board pursuant to such section shall be subject, in addition to any other penalties that may be prescribed by law, to a civil money penalty of not more than $10,000 for each such violation. (b) Standard Benefit Forms. Any health service provider or health benefit plan that the Secretary of Health and Human Services determines is required, but has substantially failed, to comply with section 5130(c) shall be subject, in addition to any other penalties that may be prescribed by law, to a civil money penalty of not more than $10,000 for each such violation. (c) Process. The process for the imposition of a civil money penalty under the All-Payer Health Care Fraud and Abuse Control Program under part 1 of subtitle E of this title shall apply to a civil money penalty under this section in the same manner as such process applies to a penalty or proceeding under such program. SEC. 5142. RELATIONSHIP TO OTHER LAWS. (a) Court Orders. Nothing in this title shall be construed to invalidate or limit the power or authority of any court of competent jurisdiction with respect to health care information. (b) Public Health Reporting. Nothing in this title shall be construed to invalidate or limit the authorities, powers, or procedures established under any law that provides for the reporting of disease, child abuse, birth, or death. Subtitle C. Remedies and Enforcement Part 1. REVIEW OF BENEFIT DETERMINATIONS FOR ENROLLED INDIVIDUALS Subpart A. General Rules SEC. 5201. HEALTH PLAN CLAIMS PROCEDURE. (a) Definitions. For purposes of this section (1) Claim. The term ``claim'' means a claim for payment or provision of benefits under a health plan or a request for preauthorization of items or services which is submitted to a health plan prior to receipt of the items or services. (2) Individual claimant. The term ``individual claimant'' with respect to a claim means any individual who submits the claim to a health plan in connection with the individual's enrollment under the plan, or on whose behalf the claim is submitted to the plan by a provider. (3) Provider claimant. The term ``provider claimant'' with respect to a claim means any provider who submits the claim to a health plan with respect to items or services provided to an individual enrolled under the plan. (b) General Rules Governing Treatment of Claims. (1) Adequate notice of disposition of claim. In any case in which a claim is submitted in complete form to a health plan, the plan shall provide to the individual claimant and any provider claimant with respect to the claim a written notice of the plan's approval or denial of the claim within 30 days after the date of the submission of the claim. The notice to the individual claimant shall be written in language calculated to be understood by the typical individual enrolled under the plan and in a form which takes into account accessibility to the information by individuals whose primary language is not English. In the case of a denial of the claim, the notice shall be provided within 5 days after the date of the determination to deny the claim, and shall set forth the specific reasons for the denial. The notice of a denial shall include notice of the right to appeal the denial under paragraph (2). Failure by any plan to comply with the requirements of this paragraph with respect to any claim submitted to the plan shall be treated as approval by the plan of the claim. (2) Plan's duty to review denials upon timely request. The plan shall review its denial of the claim if an individual claimant or provider claimant with respect to the claim submits to the plan a written request for reconsideration of the claim after receipt of written notice from the plan of the denial. The plan shall allow any such claimant not less than 60 days, after receipt of written notice from the plan of the denial, to submit the claimant's request for reconsideration of the claim. (3) Time limit for review. The plan shall complete any review required under paragraph (2), and shall provide the individual claimant and any provider claimant with respect to the claim written notice of the plan's decision on the claim after reconsideration pursuant to the review, within 30 days after the date of the receipt of the request for reconsideration. (4) De novo reviews. Any review required under paragraph (2) (A) shall be de novo, (B) shall be conducted by an individual who did not make the initial decision denying the claim and who is authorized to approve the claim, and (C) shall include review by a qualified physician if the resolution of any issues involved requires medical expertise. (c) Treatment of Urgent Requests to Plans for Preauthorization. (1) In general. This subsection applies in the case of any claim submitted by an individual claimant or a provider claimant consisting of a request for preauthorization of items or services which is accompanied by an attestation that (A) failure to immediately provide the items or services could reasonably be expected to result in (i) placing the health of the individual claimant (or, with respect to an individual claimant who is a pregnant woman, the health of the woman or her unborn child) in serious jeopardy, (ii) serious impairment to bodily functions, or (iii) serious dysfunction of any bodily organ or part, or (B) immediate provision of the items or services is necessary because the individual claimant has made or is at serious risk of making an attempt to harm such individual claimant or another individual. (2) Shortened time limit for consideration of requests for preauthorization. Notwithstanding subsection (b)(1), a health plan shall approve or deny any claim described in paragraph (1) within 24 hours after submission of the claim to the plan. Failure by the plan to comply with the requirements of this paragraph with respect to the claim shall be treated as approval by the plan of the claim. (3) Expedited exhaustion of plan remedies. Any claim described in paragraph (1) which is denied by the plan shall be treated as a claim with respect to which all remedies under the plan provided pursuant to this section are exhausted, irrespective of any review provided under subsection (b)(2). (4) Denial of previously authorized claims not permitted. In any case in which a health plan approves a claim described in paragraph (1) (A) the plan may not subsequently deny payment or provision of benefits pursuant to the claim, unless the plan makes a showing of an intentional misrepresentation of a material fact by the individual claimant, and (B) in the case of a violation of subparagraph (A) in connection with the claim, all remedies under the plan provided pursuant to this section with respect to the claim shall be treated as exhausted. (d) Time Limit for Determination of Incompleteness of Claim. For purposes of this section (1) any claim submitted by an individual claimant and accepted by a provider serving under contract with a health plan and any claim described in subsection (b)(1) shall be treated with respect to the individual claimant as submitted in complete form, and (2) any other claim for benefits under the plan shall be treated as filed in complete form as of 10 days after the date of the submission of the claim, unless the plan provides to the individual claimant and any provider claimant, within such period, a written notice of any required matter remaining to be filed in order to complete the claim. Any filing by the individual claimant or the provider claimant of additional matter requested by the plan pursuant to paragraph (2) shall be treated for purposes of this section as an initial filing of the claim. (e) Additional Notice and Disclosure Requirements for Health Plans. In the case of a denial of a claim for benefits under a health plan, the plan shall include, together with the specific reasons provided to the individual claimant and any provider claimant under subsection (b)(1) (1) if the denial is based in whole or in part on a determination that the claim is for an item or service which is not covered by the comprehensive benefit package or exceeds payment rates under the applicable alliance or State fee schedule, the factual basis for the determination, (2) if the denial is based in whole or in part on exclusion of coverage with respect to services because the services are determined to comprise an experimental treatment or investigatory procedure, the medical basis for the determination and a description of the process used in making the determination, and (3) if the denial is based in whole or in part on a determination that the treatment is not medically necessary or appropriate or is inconsistent with the plan's practice guidelines, the medical basis for the determination, the guidelines used in making the determination, and a description of the process used in making the determination. (f) Waiver of Rights Prohibited. A health plan may not require any party to waive any right under the plan or this Act as a condition for approval of any claim under the plan, except to the extent otherwise specified in a formal settlement agreement. SEC. 5202. REVIEW IN REGIONAL ALLIANCE COMPLAINT REVIEW OFFICES OF GRIEVANCES BASED ON ACTS OR PRACTICES BY HEALTH PLANS. (a) Complaint Review Offices. (1) In general. In accordance with rules which shall be prescribed by the Secretary of Labor, each State shall establish and maintain a complaint review office for each regional alliance established by such State. According to designations which shall be made by each State under regulations of the Secretary of Labor, the complaint review office for a regional alliance established by such State shall also serve as the complaint review office for corporate alliances operating in the State with respect to individuals who are enrolled under corporate alliance health plans maintained by such corporate alliances and who reside within the area of the regional alliance. (2) Regional alliances not established by States. In the case of any regional alliance established in any State by the Secretary of Health and Human Services, the Secretary of Health and Human Services shall assume all duties and obligations of such State under this part in accordance with the applicable regulations of the Secretary of Labor under this part. (b) Filings of Complaints by Aggrieved Persons. In the case of any person who is aggrieved by (1) any act or practice engaged in by any health plan which consists of or results in denial of payment or provision of benefits under the plan or delay in the payment or provision of benefits, or (2) any act or practice engaged in by any other plan maintained by a regional alliance or a corporate alliance which consists of or results in denial of payment or provision of benefits under a cost sharing policy described in section 1421(b)(2) or delay in the payment or provision of the benefits, if the denial or delay consists of a failure to comply with the terms of the plan (including the provision of benefits in full when due in accordance with the terms of the plan), or with the applicable requirements of this Act, such person may file a complaint with the appropriate complaint review office. (c) Exhaustion of Plan Remedies. Any complaint including a claim to which section 5201 applies may not be filed until the complainant has exhausted all remedies provided under the plan with respect to the claim in accordance with such section. (d) Exclusive Means of Review for Plans Maintained by Corporate Alliances. Proceedings under sections 5203 and 5204 pursuant to complaints filed under subsection (b), and review under section 5205 of determinations made under section 5204, shall be the exclusive means of review of acts or practices described in subsection (b) which are engaged in by a corporate alliance health plan or by any plan maintained by a corporate alliance with respect to benefits under a cost sharing policy described in section 1421(b)(2). (e) Form of Complaint. The complaint shall be in writing under oath or affirmation, shall set forth the complaint in a manner calculated to give notice of the nature of the complaint, and shall contain such information as may be prescribed in regulations of the Secretary of Labor. (f) Notice of Filing. The complaint review office shall serve by certified mail a notice of the complaint (including the date, place, and circumstances of the alleged violation) on the person or persons alleged in the complaint to have committed the violation within 10 days after the filing of the complaint. (g) Time Limitation. Complaints may not be brought under this section with respect to any violation later than one year after the date on which the violation occurs. This subsection shall not prevent the subsequent amending of a complaint. SEC. 5203. INITIAL PROCEEDINGS IN COMPLAINT REVIEW OFFICES. (a) Elections. Whenever a complaint is brought to the complaint review office under section 5202(b), the complaint review office shall provide the complainant with an opportunity, in such form and manner as shall be prescribed in regulations of the Secretary of Labor, to elect one of the following: (1) to forego further proceedings in the complaint review office and rely on remedies available in a court of competent jurisdiction, except with respect to any matter in the complaint with respect to which proceedings under this section and section 5204, and review under section 5205, are not under section 5202(d) the exclusive means of review, (2) to submit the complaint as a dispute under the Early Resolution Program established under subpart B and thereby suspend further review proceedings under this section pending termination of proceedings under the Program, or (3) in any case in which an election under paragraph (2) is not made, or such an election was made but resolution of all matters in the complaint was not obtained upon termination of proceedings pursuant to the election by settlement agreement or otherwise, to proceed with the complaint to a hearing in the complaint review office under section 5204 regarding the unresolved matters. (b) Effect of Participation in Early Resolution Program. Any matter in a complaint brought to the complaint review office which is included in a dispute which is timely submitted to the Early Resolution Program established under subpart B shall not be assigned to a hearing under this section unless the proceedings under the Program with respect to the dispute are terminated without settlement or resolution of the dispute with respect to such matter. Upon termination of any proceedings regarding a dispute submitted to the Program, the applicability of this section to any matter in a complaint which was included in the dispute shall not be affected by participation in the proceedings, except to the extent otherwise required under the terms of any settlement agreement or other formal resolution obtained in the proceedings. SEC. 5204. HEARINGS BEFORE HEARING OFFICERS IN COMPLAINT REVIEW OFFICES. (a) Hearing Process. (1) Assignment of complaints to hearing officers and notice to parties. (A) In general. In the case of an election under section 5203(a)(3) (i) the complaint review office shall assign the complaint, and each motion in connection with the complaint, to a hearing officer employed by the State in the office; and (ii) the hearing officer shall have the power to issue and cause to be served upon the plan named in the complaint a copy of the complaint and a notice of hearing before the hearing officer at a place fixed in the notice, not less than 5 days after the serving of the complaint. (B) Qualifications for hearing officers. No individual may serve in a complaint review office as a hearing officer unless the individual meets standards which shall be prescribed by the Secretary of Labor. Such standards shall include experience, training, affiliations, diligence, actual or potential conflicts of interest, and other qualifications deemed relevant by the Secretary of Labor. At no time shall a hearing officer have any official, financial, or personal conflict of interest with respect to issues in controversy before the hearing officer. (2) Amendment of complaints. Any such complaint may be amended by the hearing officer conducting the hearing, upon the motion of the complainant, in the hearing officer's discretion at any time prior to the issuance of an order based thereon. (3) Answers. The party against whom the complaint is filed shall have the right to file an answer to the original or amended complaint and to appear in person or otherwise and give testimony at the place and time fixed in the complaint. (b) Additional Parties. In the discretion of the hearing officer conducting the hearing, any other person may be allowed to intervene in the proceeding and to present testimony. (c) Hearings. (1) De novo hearing. Each hearing officer shall hear complaints and motions de novo. (2) Testimony. The testimony taken by the hearing officer shall be reduced to writing. Thereafter, the hearing officer, in his or her discretion, upon notice may provide for the taking of further testimony or hear argument. (3) Authority of hearing officers. The hearing officer may compel by subpoena the attendance of witnesses and the production of evidence at any designated place or hearing. In case of contumacy or refusal to obey a subpoena lawfully issued under this paragraph and upon application of the hearing officer, an appropriate district court may issue an order requiring compliance with the subpoena and any failure to obey the order may be punished by the court as a contempt thereof. The hearing officer may also seek enforcement of the subpoena in a State court of competent jurisdiction. (4) Expedited hearings. Notwithstanding section 5203 and the preceding provisions of this section, upon receipt of a complaint containing a claim described in section 5201(c)(1), the complaint review office shall promptly provide the complainant with the opportunity to make an election under section 5203(a)(3) and assignment to a hearing on the complaint before a hearing officer. The complaint review office shall ensure that such a hearing commences not later than 24 hours after receipt of the complaint by the complaint hearing office. (d) Decision of Hearing Officer. (1) In general. The hearing officer shall decide upon the preponderance of the evidence whether to decide in favor of the complainant with respect to each alleged act or practice. Each such decision (A) shall include the hearing officer's findings of fact, and (B) shall constitute the hearing officer's final disposition of the proceedings. (2) Decisions finding in favor of complainant. (A) In general. If the hearing officer's decision includes a determination that any party named in the complaint has engaged in or is engaged in an act or practice described in section 5202(b), the hearing officer shall issue and cause to be served on such party an order which requires such party (i) to cease and desist from such act or practice, (ii) to provide the benefits due under the terms of the plan and to otherwise comply with the terms of the plan and the applicable requirements of this Act, (iii) to pay to the complainant prejudgment interest on the actual costs incurred in obtaining the items and services at issue in the complaint, and (iv) to pay to the prevailing complainant a reasonable attorney's fee, reasonable expert witness fees, and other reasonable costs relating to the hearing on the charges on which the complainant prevails. (3) Decisions not in favor of complainant. If the hearing officer's decision includes a determination that the party named in the complaint has not engaged in or is not engaged in an act or practice referred to in section 5202(b), the hearing officer (A) shall include in the decision a dismissal of the charge in the complaint relating to the act or practice, and (B) upon a finding that such charge is frivolous, shall issue and cause to be served on the complainant an order which requires the complainant to pay to such party a reasonable attorney's fee, reasonable expert witness fees, and other reasonable costs relating to the proceedings on such charge. (4) Submission and service of decisions. The hearing officer shall submit each decision to the complaint review office at the conclusion of the proceedings and the office shall cause a copy of the decision to be served on the parties to the proceedings. (e) Review. (1) In general. The decision of the hearing officer shall be final and binding upon all parties. Except as provided in paragraph (2), any party to the complaint may, within 30 days after service of the decision by the complaint review office, file an appeal of the decision with the Federal Health Plan Review Board under section 5205 in such form and manner as may be prescribed by such Board. (2) Exception. The decision in the case of an expedited hearing under subsection (c)(4) shall not be subject to review. (f) Court Enforcement of Orders. (1) In general. If a decision of the hearing officer in favor of the complainant is not appealed under section 5205, the complainant may petition any court of competent jurisdiction for enforcement of the order. In any such proceeding, the order of the hearing officer shall not be subject to review. (2) Awarding of costs. In any action for court enforcement under this subsection, a prevailing complainant shall be entitled to a reasonable attorney's fee, reasonable expert witness fees, and other reasonable costs relating to such action. SEC. 5205. REVIEW BY FEDERAL HEALTH PLAN REVIEW BOARD. (a) Establishment and Membership. The Secretary of Labor shall establish by regulation a Federal Health Plan Review Board (hereinafter in this subtitle referred to as the ``Review Board''). The Review Board shall be composed of 5 members appointed by the Secretary of Labor from among persons who by reason of training, education, or experience are qualified to carry out the functions of the Review Board under this subtitle. The Secretary of Labor shall prescribe such rules as are necessary for the orderly transaction of proceedings by the Review Board. Every official act of the Review Board shall be entered of record, and its hearings and records shall be open to the public. (b) Review Process. The Review Board shall ensure, in accordance with rules prescribed by the Secretary of Labor, that reasonable notice is provided for each appeal before the Review Board of a hearing officer's decision under section 5304, and shall provide for the orderly consideration of arguments by any party to the hearing upon which the hearing officer's decision is based. In the discretion of the Review Board, any other person may be allowed to intervene in the proceeding and to present written argument. The National Health Board may intervene in the proceeding as a matter of right. (c) Scope of Review. The Review Board shall review the decision of the hearing officer from which the appeal is made, except that the review shall be only for the purposes of determining (1) whether the determination is supported by substantial evidence on the record considered as a whole, (2) in the case of any interpretation by the hearing officer of contractual terms (irrespective of the extent to which extrinsic evidence was considered), whether the determination is supported by a preponderance of the evidence, (3) whether the determination is in excess of statutory jurisdiction, authority, or limitations, or in violation of a statutory right, or (4) whether the determination is without observance of procedure required by law. (d) Decision of Review Board. The decision of the hearing officer as affirmed or modified by the Review Board (or any reversal by the Review Board of the hearing officer's final disposition of the proceedings) shall become the final order of the Review Board and binding on all parties, subject to review under subsection (e). The Review Board shall cause a copy of its decision to be served on the parties to the proceedings not later than 5 days after the date of the proceeding. (e) Review of Final Orders. (1) In general. Not later than 60 days after the entry of the final order, any person aggrieved by any such final order under which the amount or value in controversy exceeds $10,000 may seek a review of the order in the United States court of appeals for the circuit in which the violation is alleged to have occurred or in which the complainant resides. (2) Further review. Upon the filing of the record with the court, the jurisdiction of the court shall be exclusive and its judgment shall be final, except that the judgment shall be subject to review by the Supreme Court of the United States upon writ of certiorari or certification as provided in section 1254 of title 28 of the United States Code. (3) Enforcement decree in original review. If, upon appeal of an order under paragraph (1), the United States court of appeals does not reverse the order, the court shall have the jurisdiction to make and enter a decree enforcing the order of the Review Board. (f) Determinations. Determinations made under this section shall be in accordance with the provisions of this Act, the comprehensive benefit package as provided by this Act, the rules and regulations of the National Health Board prescribed under this Act, and decisions of the National Health Board published under this Act. (g) Awarding of Attorneys' Fees and Other Costs and Expenses. In any proceeding before the Review Board under this section or any judicial proceeding under subsection (e), the Review Board or the court (as the case may be) shall award to a prevailing complainant reasonable costs and expenses (including a reasonable attorney's fee) on the causes on which the complainant prevails. SEC. 5206. CIVIL MONEY PENALTIES. (a) Denial or Delay in Payment or Provision of Benefits. (1) In general. The Secretary of Labor may assess a civil penalty against any health plan, or against any other plan in connection with benefits provided thereunder under a cost sharing policy described in section 1421(b)(2), for unreasonable denial or delay in the payment or provision of benefits thereunder, in an amount not to exceed (A) $25,000 per violation, or $75,000 per violation in the case of a finding of bad faith on the part of the plan, and (B) in the case of a finding of a pattern or practice of such violations engaged in by the plan, $1,000,000 in addition to the total amount of penalties assessed under subparagraph (A) with respect to such violations. For purposes of subparagraph (A), each violation with respect to any single individual shall be treated as a separate violation. (2) Civil action to enforce civil penalty. The Secretary of Labor may commence a civil action in any court of competent jurisdiction to enforce a civil penalty assessed under subsection (a). (b) Civil Penalties for Certain Other Actions. The Secretary of Labor may assess a civil penalty described in section 5412(b)(1) against any corporate alliance health plan, or against any other plan sponsored by a corporate alliance in connection with benefits provided thereunder under a cost sharing policy described in section 1421(b)(2), for any action described in section 5412(a). The Secretary of Labor may initiate proceedings to impose such penalty in the same manner as the Secretary of Health and Human Services may initiate proceedings under section 5412 with respect to actions described in section 5412(a). Subpart B. Early Resolution Programs SEC. 5211. ESTABLISHMENT OF EARLY RESOLUTION PROGRAMS IN COMPLAINT REVIEW OFFICES. (a) Establishment of Programs. Each State shall establish and maintain an Early Resolution Program in each complaint review office in such State. The Program shall include (1) the establishment and maintenance of forums for mediation of disputes in accordance with this subpart, and (2) the establishment and maintenance of such forums for other forms of alternative dispute resolution (including binding arbitration) as may be prescribed in regulations of the Secretary of Labor. Each State shall ensure that the standards applied in Early Resolution Programs administered in such State which apply to any form of alternative dispute resolution described in paragraph (2) and which relate to time requirements, qualifications of facilitators, arbitrators, or other mediators, and confidentiality are at least equivalent to the standards which apply to mediation proceedings under this subpart. (b) Duties of Complaint Review Offices. Each complaint review office in a State (1) shall administer its Early Resolution Program in accordance with regulations of the Secretary of Labor, (2) shall, pursuant to subsection (a)(1) (A) recruit and train individuals to serve as facilitators for mediation proceedings under the Early Resolution Program from attorneys who have the requisite expertise for such service, which shall be specified in regulations of the Secretary of Labor, (B) provide meeting sites, maintain records, and provide facilitators with administrative support staff, and (C) establish and maintain attorney referral panels, (3) shall ensure that, upon the filing of a complaint with the office, the complainant is adequately apprised of the complainant's options for review under this part, and (4) shall monitor and evaluate the Program on an ongoing basis. SEC. 5212. INITIATION OF PARTICIPATION IN MEDIATION PROCEEDINGS. (a) Eligibility of Cases for Submission to Early Resolution Program. A dispute may be submitted to the Early Resolution Program only if the following requirements are met with respect to the dispute: (1) Nature of dispute. The dispute consists of an assertion by an individual enrolled under a health plan of one or more claims against the health plan for payment or provision of benefits, or against any other plan maintained by the regional alliance or corporate alliance sponsoring the health plan with respect to benefits provided under a cost sharing policy described in section 1421(b)(2), based on alleged coverage under the plan, and a denial of the claims, or a denial of appropriate reimbursement based on the claims, by the plan. (2) Nature of disputed claim. Each claim consists of (A) a claim for payment or provision of benefits under the plan; or (B) a request for information or documents the disclosure of which is required under this Act (including claims of entitlement to disclosure based on colorable claims to rights to benefits under the plan). (b) Filing of Election. A complainant with a dispute which is eligible for submission to the Early Resolution Program may make the election under section 5203(a)(2) to submit the dispute to mediation proceedings under the Program not later than 15 days after the date the complaint is filed with the complaint review office under subpart A. (c) Agreement to Participate. (1) Election by claimant. A complainant may elect participation in the mediation proceedings only by entering into a written agreement (including an agreement to comply with the rules of the Program and consent for the complaint review office to contact the health plan regarding the agreement), and by releasing plan records to the Program for the exclusive use of the facilitator assigned to the dispute. (2) Participation by plans or health benefits contractors. Each party whose participation in the mediation proceedings has been elected by a claimant pursuant to paragraph (1) shall participate in, and cooperate fully with, the proceedings. The claims review office shall provide such party with a copy of the participation agreement described in paragraph (1), together with a written description of the Program. Such party shall submit the copy of the agreement, together with its authorized signature signifying receipt of notice of the agreement, to the claims review office, and shall include in the submission to the claims review office a copy of the written record of the plan claims procedure completed pursuant to section 5201 with respect to the dispute and all relevant plan documents. The relevant documents shall include all documents under which the health plan is or was administered or operated, including copies of any insurance contracts under which benefits are or were provided and any fee or reimbursement schedules for health care providers. SEC. 5213. MEDIATION PROCEEDINGS. (a) Role of Facilitator. In the course of mediation proceedings under the Early Resolution Program, the facilitator assigned to the dispute shall prepare the parties for a conference regarding the dispute and serve as a neutral mediator at such conference, with the goal of achieving settlement of the dispute. (b) Preparations for Conference. In advance of convening the conference, after identifying the necessary parties and confirming that the case is eligible for the Program, the facilitator shall analyze the record of the claims procedure conducted pursuant to section 5201 and any position papers submitted by the parties to determine if further case development is needed to clarify the legal and factual issues in dispute, and whether there is any need for additional information and documents. (c) Conference. Upon convening the conference, the facilitator shall assist the parties in identifying undisputed issues and exploring settlement. If settlement is reached, the facilitator shall assist in the preparation of a written settlement agreement. If no settlement is reached, the facilitator shall present the facilitator's evaluation, including an assessment of the parties' positions, the likely outcome of further administrative action or litigation, and suggestions for narrowing the issues in dispute. (d) Time Limit. The facilitator shall ensure that mediation proceedings with respect to any dispute under the Early Resolution Program shall be completed within 120 days after the election to participate. The parties may agree to one extension of the proceedings by not more than 30 days if the proceedings are suspended to obtain an agency ruling or to reconvene the conference in a subsequent session. (e) Inapplicability of Formal Rules. Formal rules of evidence shall not apply to mediation proceedings under the Early Resolution Program. All statements made and evidence presented in the proceedings shall be admissible in the proceedings. The facilitator shall be the sole judge of the proper weight to be afforded to each submission. The parties to mediation proceedings under the Program shall not be required to make statements or present evidence under oath. (f) Representation. Parties may participate pro se or be represented by attorneys throughout the proceedings of the Early Resolution Program. (g) Confidentiality. (1) In general. Under regulations of the Secretary of Labor, rules similar to the rules under section 574 of title 5, United States Code (relating to confidentiality in dispute resolution proceedings) shall apply to the mediation proceedings under the Early Resolution Program. (2) Civil remedies. The Secretary of Labor may assess a civil penalty against any person who discloses information in violation of the regulations prescribed pursuant to subsection (a) in the amount of three times the amount of the claim involved. The Secretary of Labor may bring a civil action to enforce such civil penalty in any court of competent jurisdiction. SEC. 5214. LEGAL EFFECT OF PARTICIPATION IN MEDIATION PROCEEDINGS. (a) Process Nonbinding. Findings and conclusions made in the mediation proceedings of the Early Resolution Program shall be treated as advisory in nature and nonbinding. Except as provided in subsection (b), the rights of the parties under subpart A shall not be affected by participation in the Program. (b) Resolution Through Settlement Agreement. If a case is settled through participation in mediation proceedings under the Program, the facilitator shall assist the parties in drawing up an agreement which shall constitute, upon signature of the parties, a binding contract between the parties, which shall be enforceable under section 5215. (c) Preservation of Rights of Non-Parties. The settlement agreement shall not have the effect of waiving or otherwise affecting any rights to review under subpart A, or any other right under this Act or the plan, with respect to any person who is not a party to the settlement agreement. SEC. 5215. ENFORCEMENT OF SETTLEMENT AGREEMENTS. (a) Enforcement. Any party to a settlement agreement entered pursuant to mediation proceedings under this subpart may petition any court of competent jurisdiction for the enforcement of the agreement, by filing in the court a written petition praying that the agreement be enforced. In such a proceeding, the order of the hearing officer shall not be subject to review. (b) Court Review. It shall be the duty of the court to advance on the docket and to expedite to the greatest possible extent the disposition of any petition filed under this section, with due deference to the role of settlement agreements under this part in achieving prompt resolution of disputes involving health plans. (d) Awarding of Attorney's Fees and Other Costs and Expenses. In any action by an individual enrolled under a health plan for court enforcement under this section, a prevailing plaintiff shall be entitled to reasonable costs and expenses (including a reasonable attorney's fee and reasonable expert witness fees) on the charges on which the plaintiff prevails. Part 2. ADDITIONAL REMEDIES AND ENFORCEMENT PROVISIONS SEC. 5231. JUDICIAL REVIEW OF FEDERAL ACTION ON STATE SYSTEMS. (a) In General. Any State or an alliance that is aggrieved by a determination by the National Health Board under subpart B of part 1 of subtitle F of title I shall be entitled to judicial review of such determination in accordance with this section. (b) Judicial Review. (1) Jurisdiction. The courts of appeals of the United States (other than the United States Court of Appeals for the Federal Circuit) shall have jurisdiction to review a determination described in subsection (a), to affirm the determination, or to set it aside, in whole or in part. A judgment of a court of appeals in such an action shall be subject to review by the Supreme Court of the United States upon certiorari or certification as provided in section 1254 of title 28, United States Code. (2) Petition for review. A State or an alliance that desires judicial review of a determination described in subsection (a) shall, within 30 days after it has been notified of such determination, file with the United States court of appeals for the circuit in which the State or alliance is located a petition for review of such determination. A copy of the petition shall be transmitted by the clerk of the court to the National Health Board, and the Board shall file in the court the record of the proceedings on which the determination or action was based, as provided in section 2112 of title 28, United States Code. (3) Scope of review. The findings of fact of the National Health Board, if supported by substantial evidence, shall be conclusive; but the court, for good cause shown, may remand the case to the Board to take further evidence, and the Board may make new or modified findings of fact and may modify its previous action, and shall certify to the court the record of the further proceedings. Such new or modified findings of fact shall likewise be conclusive if supported by substantial evidence. SEC. 5232. ADMINISTRATIVE AND JUDICIAL REVIEW RELATING TO COST CONTAINMENT. There shall be no administrative or judicial review of any determination by the National Health Board respecting any matter under subtitle A of title VI. SEC. 5233. CIVIL ENFORCEMENT. Unless otherwise provided in this Act, the district courts of the United States shall have jurisdiction of civil actions brought by (1) the Secretary of Labor to enforce any final order of such Secretary or to collect any civil monetary penalty assessed by such Secretary under this Act; and (2) the Secretary of Health and Human Services to enforce any final order of such Secretary or to collect any civil monetary penalty assessed by such Secretary under this Act. SEC. 5234. PRIORITY OF CERTAIN BANKRUPTCY CLAIMS. Section 507(a)(8) of title 11, United States Code, is amended to read as follows: ``(8) Eighth, allowed unsecured claims ``(A) based upon any commitment by the debtor to the Federal Deposit Insurance Corporation, the Resolution Trust Corporation, the Director of the Office of Thrift Supervision, the Comptroller of the Currency, or the Board of Governors of the Federal Reserve System, or their predecessors or successors, to maintain the capital of an insured depository institution; ``(B) for payments under subtitle B of title IV of the Health Security Act owed to a regional alliance (as defined in section 1301 of such Act); ``(C) for payments owed to a corporate alliance health plan under trusteeship of the Secretary of Labor under section 1395 of the Health Security Act; or ``(D) for assessments and related amounts owed to the Secretary of Labor under section 1397 of the Health Security Act.''. SEC. 5235. PRIVATE RIGHT TO ENFORCE STATE RESPONSIBILITIES. The failure of a participating State to carry out a responsibility applicable to participating States under this Act constitutes a deprivation of rights secured by this Act for the purposes of section 1977 of the Revised Statutes of the United States (42 U.S.C. 1983). In an action brought under such section, the court shall exercise jurisdiction without regard to whether the aggrieved person has exhausted any administrative or other remedies that may be provided by law. SEC. 5236. PRIVATE RIGHT TO ENFORCE FEDERAL RESPONSIBILITIES IN OPERATING A SYSTEM IN A STATE. (a) In General. The failure of the Secretary of Health and Human Services to carry out a responsibility under section 1522 (relating to operation of an alliance system in a State) confers an enforceable right of action on any person who is aggrieved by such failure. Such a person may commence a civil action against the Secretary in an appropriate State court or district court of the United States. (b) Exhaustion of Remedies. In an action under subsection (a), the court shall exercise jurisdiction without regard to whether the aggrieved person has exhausted any administrative or other remedies that may be provided by law. (c) Relief. In an action under subsection (a), if the court finds that a failure described in such subsection has occurred, the aggrieved person may recover compensatory and punitive damages and the court may order any other appropriate relief. (d) Attorney's Fees. In an action under subsection (a), the court, in its discretion, may allow the prevailing party, other than the United States, a reasonable attorney's fee (including expert fees) as part of the costs, and the United States shall be liable for costs the same as a private person. SEC. 5237. PRIVATE RIGHT TO ENFORCE RESPONSIBILITIES OF ALLIANCES. (a) In General. The failure of a regional alliance or a corporate alliance to carry out a responsibility applicable to the alliance under this Act confers an enforceable right of action on any person who is aggrieved by such failure. Such a person may commence a civil action against the alliance in an appropriate State court or district court of the United States. (b) Exhaustion of Remedies. (1) In general. Except as provided in paragraph (2), in an action under subsection (a) the court may not exercise jurisdiction until the aggrieved person has exhausted any administrative remedies that may be provided by law. (2) No exhaustion required. In an action under subsection (a), the court shall exercise jurisdiction without regard to whether the aggrieved person has exhausted any administrative or other remedies that may be provided by law if the action relates to (A) whether the person is an eligible individual within the meaning of section 1001(c); (B) whether the person is eligible for a premium discount under subpart A of part 1 of subtitle B of title VI; (C) whether the person is eligible for a reduction in cost sharing under subpart D of part 3 of subtitle D of title I; or (D) enrollment or disenrollment in a health plan. (c) Relief. In an action under subsection (a), if the court finds that a failure described in such subsection has occurred, the aggrieved person may recover compensatory and punitive damages and the court may order any other appropriate relief. (d) Attorney's Fees. In any action under subsection (a), the court, in its discretion, may allow the prevailing party, other than the United States, a reasonable attorney's fee (including expert fees) as part of the costs, and the United States shall be liable for costs the same as a private person. SEC. 5238. DISCRIMINATION CLAIMS. (a) Civil Action by Aggrieved Person. (1) In general. Any person who is aggrieved by the failure of a health plan to comply with section 1402(c) may commence a civil action against the plan in an appropriate State court or district court of the United States. (2) Standards. The standards used to determine whether a violation has occurred in a complaint alleging discrimination under section 1402(c) shall be the standards applied under the Age Discrimination Act of 1973 (42 U.S.C. 6102 et seq.) and the Americans with Disabilities Act of 1990 (42 U.S.C. 12101 et seq.). (3) Relief. In an action under paragraph (1), if the court finds that the health plan has failed to comply with section 1402(c), the aggreived person may recover compensatory and punitive damages and the court may order any other appropriate relief. (4) Attorney's fees. In any action under paragraph (1), the court, in its discretion, may allow the prevailing party, other than the United States, a reasonable attorney's fee (including expert fees) as part of the costs, and the United States shall be liable for costs the same as a private person. (c) Action by Secretary. Whenever the Secretary of Health and Human Services finds that the health plan has failed to comply with section 1402(c), or with an applicable regulation issued under such section, the Secretary shall notify the plan. If within a reasonable period of time the health plan fails or refuses to comply, the Secretary may (1) refer the matter to the Attorney General with a recommendation that an appropriate civil action be instituted; (2) terminate the participation of the health plan in an alliance; or (3) take such other action as may be provided by law. (d) Action by Attorney General. When a matter is referred to the Attorney General under subsection (c)(1), the Attorney General may bring a civil action in a district court of the United States for such relief as may be appropriate, including injunctive relief. In a civil action under this section, the court (1) may grant any equitable relief that the court considers to be appropriate; (2) may award such other relief as the court considers to be appropriate, including compensatory and punitive damages; and (3) may, to vindicate the public interest when requested by the Attorney General, assess a civil money penalty against the health plan in an amount (A) not exceeding $50,000 for a first violation; and (B) not exceeding $100,000 for any subsequent violation. SEC. 5239. NONDISCRIMINATION IN FEDERALLY ASSISTED PROGRAMS. Federal payments to regional alliances under part 2 of subtitle C of title VI shall be treated as Federal financial assistance for purposes of section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794), section 303 of the Age Discrimination Act of 1975 (42 U.S.C. 6102), and section 601 of the Civil Rights Act of 1964 (42 U.S.C. 2000d). SEC. 5240. CIVIL ACTION BY ESSENTIAL COMMUNITY PROVIDER. (a) In General. An electing essential community provider (as defined in section 1431(d)) who is aggrieved by the failure of a health plan to fulfill a duty imposed on the plan by section 1431 may commence a civil action against the plan in an appropriate State court or district court of the United States. (b) Relief. In an action under subsection (a), if the court finds that the health plan has failed to fulfill a duty imposed on the plan by section 1431, the electing essential community provider may recover compensatory damages and the court may order any other appropriate relief. (c) Attorney's Fees. In any action under subsection (a), the court, in its discretion, may allow the prevailing party, other than the United States, a reasonable attorney's fee (including expert fees) as part of the costs, and the United States shall be liable for costs the same as a private person. SEC. 5241. FACIAL CONSTITUTIONAL CHALLENGES. (a) Jurisdiction. The United States District Court for the District of Columbia shall have original and exclusive jurisdiction of any civil action brought to invalidate this Act or a provision of this Act on the ground of its being repugnant to the Constitution of the United States on its face and for every purpose. In any action described in this subsection, the district court may not grant any temporary order or preliminary injunction restraining the enforcement, operation, or execution of this Act or any provision of this Act. (b) Statute of Limitations. An action described in subsection (a) shall be commenced not later than 1 year after the date of the enactment of this Act. (c) Convening of Three-Judge Court. An action described in subsection (a) shall be heard and determined by a district court of three judges in accordance with section 2284 of title 28, United States Code. (d) Consolidation. When actions described in subsection (a) involving a common question of law or fact are pending before a district court, the court shall order all the actions consolidated. (e) Direct Appeal to Supreme Court. In any action described in subsection (a), an appeal may be taken directly to the Supreme Court of the United States from any final judgment, decree, or order in which the district court (1) holds this Act or any provision of this Act invalid; and (2) makes a determination that its holding will materially undermine the application of the Act as whole. (f) Construction. This section does not limit (1) the right of any person (A) to a litigation concerning the Act or any portion of the Act; or (B) to petition the Supreme Court for review of any holding of a district court by writ of certiorari at any time before the rendition of judgment in a court of appeals; or (2) the authority of the Supreme Court to grant a writ of certiorari for the review described in paragraph (1)(B). SEC. 5242. TREATMENT OF PLANS AS PARTIES IN CIVIL ACTIONS. (a) In General. A health plan may sue or be sued under this Act as an entity. Service of summons, subpoena, or other legal process of a court or hearing officer upon a trustee or an administrator of any such plan in his capacity as such shall constitute service upon the plan. In a case where a plan has not designated in applicable plan documents an individual as agent for the service of legal process, service upon the Secretary of Health and Human Services (in the case of a regional alliance health plan) or the Secretary of Labor (in the case of a corporate alliance health plan) shall constitute such service. The Secretary, not later than 15 days after receipt of service under the preceding sentence, shall notify the administrator or any trustee of the plan of receipt of such service. (b) Other Parties. Any money judgment under this Act against a plan referred to in subsection (b) shall be enforceable only against the plan as an entity and shall not be enforceable against any other person unless liability against such person is established in his individual capacity under this Act. SEC. 5243. GENERAL NONPREEMPTION OF EXISTING RIGHTS AND REMEDIES. Nothing in this title shall be construed to deny, impair, or otherwise adversely affect a right or remedy available under law to any person on the date of the enactment of this Act or thereafter, except to the extent the right or remedy is inconsistent with this title. Subtitle D. Medical Malpractice Part 1. LIABILITY REFORM SEC. 5301. FEDERAL TORT REFORM. (a) Applicability. (1) In general. Except as provided in section 5302, this part shall apply with respect to any medical malpractice liability action brought in any State or Federal court, except that this part shall not apply to a claim or action for damages arising from a vaccine-related injury or death to the extent that title XXI of the Public Health Service Act applies to the claim or action. (2) Preemption. The provisions of this part shall preempt any State law to the extent such law is inconsistent with the limitations contained in such provisions. The provisions of this part shall not preempt any State law that provides for defenses or places limitations on a person's liability in addition to those contained in this subtitle, places greater limitations on the amount of attorneys' fees that can be collected, or otherwise imposes greater restrictions than those provided in this part. (3) Effect on sovereign immunity and choice of law or venue. Nothing in paragraph (2) shall be construed to (A) waive or affect any defense of sovereign immunity asserted by any State under any provision of law; (B) waive or affect any defense of sovereign immunity asserted by the United States; (C) affect the applicability of any provision of the Foreign Sovereign Immunities Act of 1976; (D) preempt State choice-of-law rules with respect to claims brought by a foreign nation or a citizen of a foreign nation; or (E) affect the right of any court to transfer venue or to apply the law of a foreign nation or to dismiss a claim of a foreign nation or of a citizen of a foreign nation on the ground of inconvenient forum. (4) Federal court jurisdiction not established on federal question grounds. Nothing in this part shall be construed to establish any jurisdiction in the district courts of the United States over medical malpractice liability actions on the basis of section 1331 or 1337 of title 28, United States Code. (b) Definitions. In this subtitle, the following definitions apply: (1) Alternative dispute resolution system; ADR. The term ``alternative dispute resolution system'' or ``ADR'' means a system that provides for the resolution of medical malpractice claims in a manner other than through medical malpractice liability actions. (2) Claimant. The term ``claimant'' means any person who alleges a medical malpractice claim, and any person on whose behalf such a claim is alleged, including the decedent in the case of an action brought through or on behalf of an estate. (3) Health care professional. The term ``health care professional'' means any individual who provides health care services in a State and who is required by the laws or regulations of the State to be licensed or certified by the State to provide such services in the State. (4) Health care provider. The term ``health care provider'' means any organization or institution that is engaged in the delivery of health care services in a State and that is required by the laws or regulations of the State to be licensed or certified by the State to engage in the delivery of such services in the State. (5) Injury. The term ``injury'' means any illness, disease, or other harm that is the subject of a medical malpractice liability action or a medical malpractice claim. (6) Medical malpractice liability action. The term ``medical malpractice liability action'' means a civil action brought in a State or Federal court against a health care provider or health care professional (regardless of the theory of liability on which the claim is based) in which the plaintiff alleges a medical malpractice claim. (7) Medical malpractice claim. The term ``medical malpractice claim'' means a claim in a civil action brought against a health care provider or health care professional in which a claimant alleges that injury was caused by the provision of (or the failure to provide) health care services, except that such term does not include (A) any claim based on an allegation of an intentional tort; or (B) any claim based on an allegation that a product is defective that is brought against any individual or entity that is not a health care professional or health care provider. SEC. 5302. PLAN-BASED ALTERNATIVE DISPUTE RESOLUTION MECHANISMS. (a) Application to Malpractice Claims Under Plans. In the case of any medical malpractice claim arising from the provision of (or failure to provide) health care services to an individual enrolled in a regional alliance plan or a corporate alliance plan, no medical malpractice liability action may be brought with respect to such claim until the final resolution of the claim under the alternative dispute resolution system adopted by the plan under subsection (b). (b) Adoption of Mechanism by Plans. Each regional alliance plan and corporate alliance plan shall (1) adopt at least one of the alternative dispute resolution methods specified under subsection (c) for the resolution of medical malpractice claims arising from the provision of health care services to individuals enrolled in the plan; and (2) disclose to enrollees (and potential enrollees), in a manner specified by the regional alliance or the corporate alliance, the availability and procedures for consumer grievances under the plan, including the alternative dispute resolution method or methods adopted under this subsection. (c) Specification of Permissible Alternative Dispute Resolution Methods. (1) In general. The National Health Board shall, by regulation, develop alternative dispute resolution methods for the use by regional alliance and corporate alliance plans in resolving medical malpractice claims under subsection (a). Such methods shall include at least the following: (A) Arbitration. The use of arbitration. (B) Mediation. The use of required mediation. (C) Early offers of settlement. The use of a process under which parties are required to make early offers of settlement. (2) Standards for establishing methods. In developing alternative dispute resolution methods under paragraph (1), the National Health Board shall assure that the methods promote the resolution of medical malpractice claims in a manner that (A) is affordable for the parties involved; (B) provides for timely resolution of claims; (C) provides for the consistent and fair resolution of claims; and (D) provides for reasonably convenient access to dispute resolution for individuals enrolled in plans. (d) Further Redress. A plan enrollee dissatisfied with the determination reached as a result of an alternative dispute resolution method applied under this section may, after the final resolution of the enrollee's claim under the method, bring a cause of action to seek damages or other redress with respect to the claim to the extent otherwise permitted under State law. SEC. 5303. REQUIREMENT FOR CERTIFICATE OF MERIT. (a) Requiring Submission With Complaint. No medical malpractice liability action may be brought by any individual unless, at the time the individual brings the action (except as provided in subsection (b)(2)), the individual submits an affidavit (1) declaring that the individual (or the individual's attorney) has consulted and reviewed the facts of the action with a qualified medical specialist (as defined in subsection (c)); (2) including a written report by a qualified medical specialist that clearly identifies the individual and that includes the medical specialist's determination that, after a review of the medical record and other relevant material, there is a reasonable and meritorious cause for the filing of the action against the defendant; and (3) on the basis of the qualified medical specialist's review and consultation, that the individual (or the individual's attorney) has concluded that there is a reasonable and meritorious cause for the filing of the action. (b) Extension in Certain Instances. (1) In general. Subject to paragraph (2), subsection (a) shall not apply with respect to an individual who brings a medical malpractice liability action without submitting an affidavit described in such subsection if (A) the individual is unable to obtain the affidavit before the expiration of the applicable statute of limitations; or (B) at the time the individual brings the action, the individual has been unable to obtain medical records or other information necessary to prepare the affidavit requested pursuant to any applicable law. (2) Deadline for submission where extension applies. In the case of an individual who brings an action for which paragraph (1) applies, the action shall be dismissed unless the individual submits the affidavit described in subsection (a) not later than (A) in the case of an action for which subparagraph (A) of paragraph (1) applies, 90 days after bringing the action; or (B) in the case of an action for which subparagraph (B) of paragraph (1) applies, 90 days after obtaining the information described in such subparagraph. (c) Qualified Medical Specialist Defined. In subsection (a), a ``qualified medical specialist'' means, with respect to a defendant to a medical malpractice liability action, a health care professional who (1) is knowledgeable of, and has expertise in, the same specialty area of medical practice that is the subject of the action; and (2) is reasonably believed by the individual bringing the action (or the individual's attorney) (A) to be knowledgeable in the relevant issues involved in the particular action, (B) to practice (or to have practiced within the preceding 6 years) or to teach (or to have taught within the preceding 6 years) in the same area of health care or medicine that is at issue in the action, and (C) to be qualified by experience or demonstrated competence in the subject of the case. (d) Sanctions for Submitting False Allegations. Upon the motion of any party or its own initiative, the court in a medical malpractice liability action may impose a sanction on a party or the party's attorney (or both), including a requirement that the party reimburse the other party to the action for costs and reasonable attorney's fees, if any information contained in an affidavit described in subsection (a) is submitted without reasonable cause and is found to be untrue. SEC. 5304. LIMITATION ON AMOUNT OF ATTORNEY'S CONTINGENCY FEES. (a) In General. An attorney who represents, on a contingency fee basis, a plaintiff in a medical malpractice liability action may not charge, demand, receive, or collect for services rendered in connection with such action (including the resolution of the claim that is the subject of the action under any alternative dispute resolution) in excess of 33\1/3\ of the total amount recovered by judgment or settlement in such action. (b) Calculation of periodic payments. In the event that a judgment or settlement includes periodic or future payments of damages, the amount recovered for purposes of computing the limitation on the contingency fee under subsection (a) shall be based on the cost of the annuity or trust established to make the payments. In any case in which an annuity or trust is not established to make such payments, such amount shall be based on the present value of the payments. (c) Contingency Fee Defined. As used in this section, the term ``contingency fee'' means any fee for professional legal services which is, in whole or in part, contingent upon the recovery of any amount of damages, whether through judgment or settlement. SEC. 5305. REDUCTION OF AWARDS FOR RECOVERY FROM COLLATERAL SOURCES. The total amount of damages recovered by a plaintiff in a medical malpractice liability action shall be reduced by the amount of any past or future payment which the claimant has received or for which the claimant is eligible on account of the same injury for which the damages are awarded, including payment under (1) Federal or State disability or sickness programs; (2) Federal, State, or private health insurance programs; (3) private disability insurance programs; (4) employer wage continuation programs; and (5) any other program, if the payment is intended to compensate the claimant for the same injury for which damages are awarded. SEC. 5306. PERIODIC PAYMENT OF AWARDS. At the request of any party to a medical malpractice liability action, the defendant shall not be required to pay damages in a single, lump-sum payment, but shall be permitted to make such payments periodically based on such schedule as the court considers appropriate, taking into account the periods for which the injured party will need medical and other services. Part 2. OTHER PROVISIONS RELATING TO MEDICAL MALPRACTICE LIABILITY SEC. 5311. ENTERPRISE LIABILITY DEMONSTRATION PROJECT. (a) Establishment. Not later than January 1, 1996, the Secretary of Health and Human Services shall establish a demonstration project under which the Secretary shall provide funds (in such amount as the Secretary considers appropriate) to one or more eligible States to demonstrate whether substituting liability for medical malpractice on the part of the health plan in which a physician participates for the personal liability of the physician will result in improvements in the quality of care provided under the plan, reductions in defensive medical practices, and better risk management. (b) Eligibility of State. A State is eligible to participate in the demonstration project established under subsection (a) if the State submits an application to the Secretary (at such time and in such form as the Secretary may require) containing such information and assurances as the Secretary may require, including assurances that the State (1) has entered into an agreement with a health plan (other than a fee-for-service plan) operating in the State under which the plan assumes legal liability with respect to any medical malpractice claim arising from the provision of (or failure to provide) services under the plan by any physician participating in the plan; (2) has provided that, under the law of the State, a physician participating in a plan that has entered into an agreement with the State under paragraph (1) may not be liable in damages or otherwise for such a claim and the plan may not require such physician to indemnify the plan for any such liability; and (3) will provide the Secretary with such reports on the operation of the project as the Secretary may require. (c) Authorization of Appropriations. There are authorized to be appropriated such sums as may be necessary to carry out demonstration projects under this section. SEC. 5312. PILOT PROGRAM APPLYING PRACTICE GUIDELINES TO MEDICAL MALPRACTICE LIABILITY ACTIONS. (a) Establishment. Not later than 1 year after the Secretary of Health and Human Services determines that appropriate practice guidelines are available, the Secretary shall establish a pilot program under which the Secretary shall provide funds (in such amount as the Secretary considers appropriate) to one or more eligible States to determine the effect of applying practice guidelines in the resolution of medical malpractice liability actions. (b) Eligibility of State. A State is eligible to participate in the pilot program established under subsection (a) if the State submits an application to the Secretary (at such time and in such form as the Secretary may require) containing (1) assurances that, under the law of the State, in the resolution of any medical malpractice liability action, it shall be a complete defense to any allegation that a party against whom the action is filed was negligent that, in the provision of (or the failure to provide) the services that are the subject of the action, the party followed the appropriate practice guideline established by the National Quality Management Program under subtitle A; and (2) such other information and assurances as the Secretary may require. (c) Reports to Congress. Not later than 3 months after each year for which the pilot program established under subsection (a) is in effect, the Secretary shall submit a report to Congress describing the operation of the program during the previous year and containing such recommendations as the Secretary considers appropriate, including recommendations relating to revisions to the laws governing medical malpractice liability. Subtitle E. Fraud and Abuse Part 1. ESTABLISHMENT OF ALL-PAYER HEALTH CARE FRAUD AND ABUSE CONTROL PROGRAM SEC. 5401. ALL-PAYER HEALTH CARE FRAUD AND ABUSE CONTROL PROGRAM. (a) In General. Not later than January 1, 1996, the Secretary of Health and Human Services (acting through the Office of the Inspector General of the Department of Health and Human Services) and the Attorney General shall establish a program (1) to coordinate the functions of the Attorney General, the Secretary, and other organizations with respect to the prevention, detection, and control of health care fraud and abuse, (2) to conduct investigations, audits, evaluations, and inspections relating to the delivery of and payment for health care in the United States, and (3) to facilitate the enforcement of this subtitle and other statutes applicable to health care fraud and abuse. (b) Coordination With Law Enforcement Agencies. In carrying out the program under subsection (a), the Secretary and Attorney General shall consult with, and arrange for the sharing of data and resources with Federal, State and local law enforcement agencies, State Medicaid Fraud Control Units, and State agencies responsible for the licensing and certification of health care providers. (c) Coordination With Health Alliances and Health Plans. In carrying out the program under subsection (a), the Secretary and Attorney General shall consult with, and arrange for the sharing of data with representatives of health alliances and health plans. (d) Authorities of Attorney General, Secretary, and Inspector General. In carrying out duties established under subsection (a), the Attorney General, the Secretary, and the Inspector General are authorized (1) to conduct, supervise, and coordinate audits, civil and criminal investigations, inspections, and evaluations relating to the program established under such subsection; and (2) to have access (including on-line access as requested and available) to all records available to health alliances and health plans that relate to ongoing investigations or the imposition of sanctions under such program (subject to restrictions based on the confidentiality of certain information under subtitle B). (e) Qualified Immunity for Providing Information. The provisions of section 1157(a) of the Social Security Act (relating to limitation on liability) shall apply to a person providing information or communications to the Secretary or Attorney General in conjunction with their performance of duties under this section, in the same manner as such section applies to information provided to organizations with a contract under part B of title XI of such Act. (f) Authorizations of Appropriations for Investigators and Other Personnel. In addition to any other amounts authorized to be appropriated to the Secretary and the Attorney General for health care anti-fraud and abuse activities for a fiscal year, there are authorized to be appropriated such additional amounts as may be necessary to enable the Secretary and the Attorney General to conduct investigations, audits, evaluations, and inspections of allegations of health care fraud and abuse and otherwise carry out the program established under subsection (a) in a fiscal year. (g) Use of Powers Under Inspector General Act of 1978. In carrying out duties and responsibilities under the program established under subsection (a), the Inspector General is authorized to exercise all powers granted under the Inspector General Act of 1978 to the same manner and extent as provided in that Act. (h) Definitions. In this part and part 2 (1) the term ``Inspector General'' means the Inspector General of the Department of Health and Human Services; and (2) the term ``Secretary'' means Secretary of Health and Human Services. SEC. 5402. ESTABLISHMENT OF ALL-PAYER HEALTH CARE FRAUD AND ABUSE CONTROL ACCOUNT. (a) Establishment. (1) In general. There is hereby created on the books of the Treasury of the United States an account to be known as the ``All-Payer Health Care Fraud and Abuse Control Account'' (in this section referred to as the ``Anti-Fraud Account ''). The Anti-Fraud Account shall consist of such gifts and bequests as may be made as provided in paragraph (2) and such amounts as may be deposited in such Anti-Fraud Account as provided in subsection (b)(4) and title XI of the Social Security Act. It shall also include the following: (A) All criminal fines imposed in cases involving a Federal health care offense (as defined in subsection (e)). (B) Penalties and damages imposed under the False Claims Act (31 U.S.C. 3729 et seq.), in cases involving claims related to the provision of health care items and services (other than funds awarded to a relator or for restitution). (C) Administrative penalties and assessments imposed under titles XI, XVIII and XIX of the Social Security Act and section 5412 (except as otherwise provided by law). (D) Amounts resulting from the forfeiture of property by reason of a Federal health care offense. Any such funds received on or after the date of the enactment of this Act shall be deposited in the Anti-Fraud Account. (2) Authorization to accept gifts. The Anti-Fraud Account is authorized to accept on behalf of the United States money gifts and bequests made unconditionally to the Anti-Fraud Account, for the benefit of the Anti-Fraud Account, or any activity financed through the Anti-Fraud Account. (b) Use of Funds. (1) In general. Amounts in the Anti-Fraud Account shall be available without appropriation and until expended to assist the Secretary and Attorney General in carrying out the All-Payer Health Care Fraud and Abuse Control Program established under section 5401 (including the administration of the Program), and may be used to cover costs incurred in operating the Program, including (A) costs of prosecuting health care matters (through criminal, civil and administrative proceedings); (B) costs of investigations (including equipment, salaries, administratively uncontrollable work, travel and training of law enforcement personnel); (C) costs of financial and performance audits of health care programs and operations; (D) costs of inspections and other evaluations. (2) Funds used to supplement agency appropriations. It is intended that disbursements made from the Anti-Fraud Account to any Federal agency be used to increase and not supplant the recipient agency's appropriated operating budget. (c) Annual Report. The Secretary and the Attorney General shall submit an annual report to Congress on the amount of revenue which is generated and disbursed by the Anti-Fraud Account in each fiscal year. (d) Federal Health Care Offense Defined. The term ``Federal health care offense'' means a violation of, or a criminal conspiracy to violate (1) sections 226, 668, 1033, or 1347 of title 18, United States Code; (2) section 1128B of the Social Security Act; (3) sections 287, 371, 664, 666, 1001, 1027, 1341, 1343, or 1954 of title 18, United States Code, if the violation or conspiracy relates to health care fraud; (4) sections 501 or 511 of the Employee Retirement Income Security Act of 1974, if the violation or conspiracy relates to health care fraud; (5) sections 301, 303(a)(2), or 303(b) or (e) of the Federal Food Drug and Cosmetic Act, if the violation or conspiracy relates to health care fraud. SEC. 5403. USE OF FUNDS BY INSPECTOR GENERAL. (a) Reimbursements for Investigations. (1) In general. The Inspector General is authorized to receive and retain for current use reimbursement for the costs of conducting investigations, when such restitution is ordered by a court, voluntarily agreed to by the payor, or otherwise. (2) Crediting. Funds received by such Office as reimbursement for costs of conducting investigations shall be deposited to the credit of such Office appropriation from which initially paid, or to appropriations for similar purposes currently available at the time of deposit, and shall remain available for obligation for 365 days from the date of their deposit. (3) Exception for forfeitures. This subsection does not apply to investigative costs paid to such Office from the Health Care Asset Forfeiture Fund, which monies shall be deposited and expended in accordance with subsection (b). (b) HHS Office of Inspector General Asset Forfeiture Proceeds Fund. (1) In general. There is established in the Treasury of the United States the ``HHS Office of Inspector General Asset Forfeiture Proceeds Fund,'' to be administered by the Inspector General, which shall be available to such Office without fiscal year limitation for expenses relating to the investigation of matters within the jurisdiction of such Office. (2) Deposits. There shall be deposited in the Fund all proceeds from forfeitures that have been transferred to the Office of Inspector General from the Department of Justice Asset Forfeiture Fund under section 524(d)(1) of title 28, United States Code. Part 2. APPLICATION OF FRAUD AND ABUSE AUTHORITIES UNDER THE SOCIAL SECURITY ACT TO ALL PAYERS SEC. 5411. EXCLUSION FROM PARTICIPATION. (a) Mandatory Exclusion. The Secretary shall exclude an individual or entity from participation in any applicable health plan if the individual or entity is described in section 1128(a) of the Social Security Act (relating to individuals and entities convicted of health care-related crimes or patient abuse). (b) Permissive Exclusion. The Secretary may exclude an individual or entity from participation in any applicable health plan if the individual or entity is described in section 1128(b) of the Social Security Act (other than paragraphs (6)(A), (6)(C), (6)(D), (10), or (13) of such section). (c) Notice, Effective Date, and Period of Exclusion. (1) An exclusion under this section or section 5412(b)(3) shall be effective at such time and upon such reasonable notice to the public and to the individual or entity excluded as may be specified in regulations consistent with paragraph (2). (2) Such an exclusion shall be effective with respect to services furnished to an individual on or after the effective date of the exclusion. (3)(A) The Secretary shall specify, in the notice of exclusion under paragraph (1) and the written notice under section 5412 of this Act, the minimum period (or, in the case of an exclusion of an individual described in section 1128(b)(12) of the Social Security Act, the period) of the exclusion. (B) In the case of a mandatory exclusion under subsection (a), the minimum period of exclusion shall be not less than 5 years. (C) In the case of an exclusion of an individual described in paragraph (1), (2), or (3) of section 1128(b) of the Social Security Act, the period of exclusion shall be a minimum of 3 years, unless the Secretary determines that a longer period is necessary because of aggravating circumstances. (D) In the case of an exclusion of an individual or entity described in paragraph (4) or (5) of sections 1128(b) of the Social Security Act, the period of the exclusion shall not be less than the period during which the individual's or entity's license to provide health care is revoked, suspended or surrendered, or the individual or the entity is excluded or suspended from a Federal or State health care program. (E) In the case of an exclusion of an individual or entity described in paragraph (6)(B) of section 1128(b) of the Social Security Act, the period of the exclusion shall be not less than 1 year. (F) In the case of an exclusion of an individual described in paragraph (12) of section 1128(b) of the Social Security Act, the period of the exclusion shall be equal to the sum of (i) the length of the period in which the individual failed to grant the immediate access described in that paragraph, and (ii) an additional period, not to exceed 90 days, set by the Secretary. (d) Notice to Entities Administering Public Programs for the Delivery of or Payment for Health Care Items or Services. (1) The Secretary shall exercise the authority under this section in a manner that results in an individual's or entity's exclusion from all applicable health plans for the delivery of or payment for health care items or services. (2) The Secretary shall promptly notify each sponsor of an applicable health plan and each entity that administers a State health care program described in section 1128(h) of the Social Security Act of the fact and circumstances of each exclusion effected against an individual or entity under this section or under section 5412. (e) Notice to State Licensing Agencies. The provisions of section 1128(e) of the Social Security Act shall apply to this section in the same manner as such provisions apply to sections 1128 and 1128A of such Act. (f) Notice, Hearing, and Judicial Review. (1) Subject to paragraph (2), any individual or entity that is excluded (or directed to be excluded) from participation under this section is entitled to reasonable notice and opportunity for a hearing thereon by the Secretary to the same extent as is provided in section 205(b) of the Social Security Act, and to judicial review of the Secretary's final decision after such hearing as is provided in section 205(g) of such Act, except that such action shall be brought in the Court of Appeals of the United States for the judicial circuit in which the individual or entity resides, or has a principal place of business, or, if the individual or entity does not reside or have a principal place of business within any such judicial circuit, in the United States Court of Appeals for the District of Columbia Circuit. (2) Unless the Secretary determines that the health or safety of individuals receiving services warrants the exclusion taking effect earlier, any individual or entity that is the subject of an adverse determination based on paragraphs (3), (4), (5), (6), (7), (8), (9), or (14) of section 1128(b) of the Social Security Act, shall be entitled to a hearing by an administrative law judge (as provided under section 205(b) of the Social Security Act) on the determination before any exclusion based upon the determination takes effect. If a hearing is requested, the exclusion shall be effective upon the issuance of an order by the administrative law judge upholding the determination of the Secretary to exclude. (3) The provisions of section 205(h) of the Social Security Act shall apply with respect to this section to the same extent as such provisions apply with respect to title II of such Act. (g) Application for Termination of Exclusion. (1) An individual or entity excluded (or directed to be excluded) from participation under this section or section 5412(b)(3) may apply to the Secretary, in the manner specified by the Secretary in regulations and at the end of the minimum period of exclusion (or, in the case of an individual or entity described in section 1128(b)(8), the period of exclusion) provided under this section and a such other times as the Secretary may provide, for termination of the exclusion. (2) The Secretary may terminate the exclusion if the Secretary determines, on the basis of the conduct of the applicant which occurred after the date of the notice of exclusion or which was unknown to the Secretary at the time of the exclusion, that (A) there is no basis under this section or section 5412(b)(3) for a continuation of the exclusion, and (B) there are reasonable assurances that the types of actions which formed the basis for the original exclusion have not recurred and will not recur. (3) The Secretary shall promptly notify each sponsor of an applicable health plan entity that administers a State health care program described in section 1128(h) of the Social Security Act of each termination of exclusion made under this subsection. (h) Convicted Defined. In this section, the term ``convicted'' has the meaning given such term in section 1128(i) of the Social Security Act. (i) Request for Exclusion. The sponsor of any applicable health plan (including a State in the case of a regional alliance health plan and the Secretary of Labor in the case of a corporate alliance health plan) may request that the Secretary of Health and Human Services exclude an individual or entity with respect to actions under such a plan in accordance with this section. SEC. 5412. CIVIL MONETARY PENALTIES. (a) Actions Subject to Penalty. Any person who is determined by the Secretary to have committed any of the following actions with respect to an applicable health plan shall be subject to a penalty in accordance with subsection (b): (1) Actions subject to penalty under medicare, medicaid, and other social security health programs. Any action that would subject the person to a penalty under paragraphs (1) through (12) of section 1128A of the Social Security Act if the action was taken with respect to title V, XVIII, XIX or XX of such Act. (2) Termination of enrollment. The termination of an individual's enrollment (including the refusal to re-enroll an individual) in violation of subtitle E of title I or State law. (3) Discriminating on basis of medical condition. The engagement in any practice that would reasonably be expected to have the effect of denying or discouraging the initial or continued enrollment in a health plan by individuals whose medical condition or history indicates a need for substantial future medical services. (4) Inducing enrollment on false pretenses. The engagement in any practice to induce enrollment in an applicable health plan through representations to individuals which the person knows or should know are false or fraudulent. (5) Providing incentives to enroll. The offer or payment of remuneration to any individual eligible to enroll in an applicable health plan that such person knows or should know is likely to influence such individual to enroll in a particular plan. (b) Penalties Described. (1) General rule. Any person who the Secretary determines has committed an action described in paragraphs (2) through (6) of subsection (a) shall be subject to a civil monetary penalty in an amount not to exceed $50,000 for each such determination. (2) Actions subject to penalties under social security act. In the case of a person who the Secretary determines has committed an action described in paragraph (1) of subsection (a), the person shall be subject to the civil monetary penalty (together with any additional assessment) to which the person would be subject under section 1128A of the Social Security Act if the action on which the determination is based had been committed with respect to title V, XVIII, XIX or XX of such Act. (3) Determinations to exclude permitted. In addition to any civil monetary penalty imposed under this subsection, the Secretary may make a determination in the same proceeding to exclude the person from participation in all applicable health plans for the delivery of or payment for health care items or services (in accordance with section 5411(c)). (c) Procedures for Imposition of Penalties. (1) Applicability of procedures under social security act. Except as otherwise provided in paragraphs (2) and (3), the provisions of subsections (c), (d), (e), (g), (j), (k), and (l) of section 1128A of the Social Security Act shall apply with respect to the imposition of penalties under this section in the same manner as such provisions apply with respect to the imposition of civil monetary penalties under section 1128A of such Act. (2) Limitation on time for attorney general to act. The first sentence of section 1128A(c) of the Social Security Act shall be applied with respect to civil monetary penalties under this section as if the reference in such section to ``one year'' was a reference to ``60 days''. (3) Authority of states to impose penalties. If no proceeding to impose a civil monetary penalty under this section with respect to actions relating to a regional alliance health plan has been initiated (by either the Attorney General or the Secretary) within 120 days after the Secretary presents a case to the Attorney General for consideration of the imposition of such a penalty, the State in which the alliance is located may initiate proceedings to impose a civil monetary penalty under this section with respect to the action in the same manner as the Secretary may initiate such proceedings. (d) Treatment of Amounts Recovered. Any amounts recovered under this section shall be paid to the Secretary and disposed of as follows: (1) Such portions of the amounts recovered as is determined to have been improperly paid from an applicable health plan for the delivery of or payment for health care items or services shall be repaid to such plan. (2) The remainder of the amounts recovered shall be deposited in the All-Payer Health Care Fraud and Abuse Control Account established under section 5402. (e) Notification of Licensing Authorities. Whenever the Secretary's determination to impose a penalty, assessment, or exclusion under this section becomes final, the Secretary shall notify the appropriate State or local licensing agency or organization (including the agency specified in section 1864(a) and 1902(a)(33) of the Social Security Act) that such a penalty, assessment, or exclusion has become final and the reasons therefor. SEC. 5413. LIMITATIONS ON PHYSICIAN SELF-REFERRAL. The provisions of section 1877 of the Social Security Act shall apply (1) to items and services (and payments and claims for payment for such items and services) furnished under any applicable health plan in the same manner as such provisions apply to designated health services (and payments and claims for payment for such services) under title XVIII of the Social Security Act; and (2) to a State (with respect to an item or service furnished or payment made under a regional alliance health plan) and to the Secretary of Labor (with respect to a an item or service furnished or payment made under a corporate alliance health plan) in the same manner as such provisions apply to the Secretary. SEC. 5414. CONSTRUCTION OF SOCIAL SECURITY ACT REFERENCES. (a) Incorporation of Other Amendments. Any reference in this part to a provision of the Social Security Act shall be considered a reference to the provision as amended under title IV. (b) Effect of Subsequent Amendments. Except as provided in subsection (a), any reference to a provision of the Social Security Act in this part shall be deemed to be a reference to such provision as in effect on the date of the enactment of this Act, and (except as Congress may otherwise provide) any amendments made to such provisions after such date shall not be taken into account in determining the applicability of such provisions to individuals and entities under this Act. Part 3. AMENDMENTS TO ANTI-FRAUD AND ABUSE PROVISIONS UNDER THE SOCIAL SECURITY ACT SEC. 5421. REFERENCE TO AMENDMENTS. For provisions amending the anti-fraud and abuse provisions existing under the Social Security Act, see part 5 of subtitle A of title IV. Part 4. AMENDMENTS TO CRIMINAL LAW SEC. 5431. HEALTH CARE FRAUD. (a) In General. Chapter 63 of title 18, United States Code, is amended by adding at the end the following: `` 1347. Health care fraud ``(a) Whoever knowingly executes, or attempts to execute, a scheme or artifice ``(1) to defraud any health alliance, health plan, or other person, in connection with the delivery of or payment for health care benefits, items, or services; ``(2) to obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any health alliance, health plan, or person in connection with the delivery of or payment for health care benefits, items, or services; ``shall be fined under this title or imprisoned not more than 10 years, or both. If the violation results in serious bodily injury (as defined in section 1365 of this title) such person shall be imprisoned for life or any term of years. ``(b) As used in this section, the terms `health alliance' and `health plan' have the meanings given those terms in title I of the Health Security Act.''. (b) Clerical Amendment. The table of sections at the beginning of chapter 63 of title 18, United States Code, is amended by adding at the end the following: ``1347. Health care fraud.''. SEC. 5432. FORFEITURES FOR VIOLATIONS OF FRAUD STATUTES. (a) In General. Section 982(a) of title 18, United States Code, is amended by inserting after paragraph (5) the following: ``(6) If the court determines that a Federal health care offense (as defined in section 5402(e) of the Health Security Act) is of a type that poses a serious threat to the health of any person or has a significant detrimental impact on the health care system, the court, in imposing sentence on a person convicted of that offense, shall order that person to forfeit property, real or personal, that ``(A)(i) is used in the commission of the offense; or ``(ii) constitutes or is derived from proceeds traceable to the commission of the offense; and ``(B) is of a value proportionate to the seriousness of the offense.''. (b) Proceeds of Health Care Fraud Forfeitures. Section 524(c)(4)(A) of title 28, United States Code, is amended by inserting ``all proceeds of forfeitures relating to Federal health care offenses (as defined in section 5402(e) of the Health Security Act), and'' after ``except''. SEC. 5433. FALSE STATEMENTS. (a) In General. Chapter 47 of title 18, United States Code, is amended by adding at the end the following: `` 1033. False statements relating to health care matters ``(a) Whoever, in any matter involving a health alliance or health plan, knowingly and willfully falsifies, conceals, or covers up by any trick, scheme, or device a material fact, or makes any false, fictitious, or fraudulent statements or representations, or makes or uses any false writing or document knowing the same to contain any false, fictitious, or fraudulent statement or entry, shall be fined under this title or imprisoned not more than 5 years, or both. ``(b) As used in this section the terms `health alliance' and `health plan' have the meanings given those terms in title I of the Health Security Act.''. (b) Clerical Amendment. The table of sections at the beginning of chapter 47 of title 18, United States Code, is amended by adding at the end the following: ``1033. False statements relating to health care matters.''. SEC. 5434. BRIBERY AND GRAFT. (a) In General. Chapter 11 of title 18, United States Code, is amended by adding at the end the following: ``. Bribery and graft in connection with health care ``(a) Whoever ``(1) directly or indirectly, corruptly gives, offers, or promises anything of value to a health care official, or offers or promises a health care official to give anything of value to any other person, with intent ``(A) to influence, or for or because of, any of the health care official's actions, decisions, or duties relating to a health alliance or health plan; ``(B) to influence such an official to commit or aid in the committing, or collude in or allow, any fraud, or make opportunity for the commission of any fraud, on a health alliance or health plan, or for or because of any such conduct on the part of such an official; or ``(C) to induce such an official to engage in any conduct in violation of the lawful duty of such official, or for or because of such conduct; or ``(2) being a health care official, directly or indirectly, corruptly demands, seeks, receives, accepts, or agrees to accept anything of value personally or for any other person or entity, the giving of which violates paragraph (1) of this subsection. ``(b) As used in this section ``(1) the term `health care official' means ``(A) an administrator, officer, trustee, fiduciary, custodian, counsel, agent, or employee of any health care alliance or health plan; ``(B) an officer, counsel, agent, or employee, of an organization that provides services under contract to any health alliance or health plan; ``(C) an official or employee of a State agency having regulatory authority over any health alliance or health plan; ``(D) an officer, counsel, agent, or employee of a health care sponsor; and ``(2) the term `health care sponsor' means any individual or entity serving as the sponsor of a health alliance or health plan for purposes of the Health Security Act, and includes the joint board of trustees or other similar body used by two or more employers to administer a health alliance or health plan for purposes of such Act.''. (b) Clerical Amendment. The table of chapters at the beginning of chapter 11 of title 18, United States Code, is amended by adding at the end the following: `` Bribery and graft in connection with health care.''. SEC. 5435. INJUNCTIVE RELIEF RELATING TO HEALTH CARE OFFENSES. Section 1345(a)(1) of title 18, United States Code, is amended (1) by striking ``or'' at the end of subparagraph (A); (2) by inserting ``or'' at the end of subparagraph (B); and (3) by adding at the end the following: ``(C) committing or about to commit a Federal health care offense (as defined in section 5402(e) of the Health Security Act);''. SEC. 5436. GRAND JURY DISCLOSURE. Section 3322 of title 18, United States Code, is amended (1) by redesignating subsections (c) and (d) as subsections (d) and (e), respectively; and (2) by inserting after subsection (b) the following: ``(c) A person who is privy to grand jury information concerning a health law violation ``(1) received in the course of duty as an attorney for the Government; or ``(2) disclosed under rule 6(e)(3)(A)(ii) of the Federal Rules of Criminal Procedure; ``may disclose that information to an attorney for the Government to use in any civil proceeding related to a Federal health care offense (as defined in section 5402(e) of the Health Security Act), or for use in connection with civil forfeiture under section 981(a)(1)(C) of this title.''. SEC. 5437. THEFT OR EMBEZZLEMENT. (a) In General. Chapter 31 of title 18, United States Code, is amended by adding at the end the following: `` 668. Theft or embezzlement in connection with health care ``(a) Whoever embezzles, steals, willfully and unlawfully converts to the use of any person other than the rightful owner, or intentionally misapplies any of the moneys, securities, premiums, credits, property, or other assets of a health alliance, health plan, or of any fund connected with such an alliance or plan, shall be fined under this title or imprisoned not more than 10 years, or both. ``(b) As used in this section, the terms `health alliance' and `health plan' have the meanings given those terms under title I of the Health Security Act.''. (b) Clerical Amendment. The table of sections at the beginning of chapter 31 of title 18, United States Code, is amended by adding at the end the following: ``668. Theft or embezzlement in connection with health care.''. SEC. 5438. MISUSE OF HEALTH SECURITY CARD OR UNIQUE IDENTIFIER. (a) In General. Chapter 33 of title 18, United States Code, is amended by adding at the end the following new section: `` Misuse of health security card or unique identifier ``Whoever ``(1) requires the display of, requires the use of, or uses a health security card that is issued under section 1001(b) of the American Health Security Act for any purpose other than a purpose described in section 5105(a) of such Act; or ``(2) requires the disclosure of, requires the use of, or uses a unique identifier number provided pursuant to section 5104 of such Act for any purpose that is not authorized by the National Health Board pursuant to such section; ``shall be fined under this title or imprisoned not more than 2 years, or both.''. (b) Clerical Amendments to Table of Sections. The table of sections at the beginning of chapter 33, United States Code, is amended (1) by amending the catchline to read as follows: ``CHAPTER 33 EMBLEMS, INSIGNIA, IDENTIFIERS, AND NAMES''; and (2) by adding at the end the following new item: `` Misuse of health security card or unique identifier.''. (c) Clerical Amendment to Table of Chapters. The item relating to chapter 33 in the table of chapters at the beginning of part 1 of title 18, United States Code, is amended to read as follows: ``Emblems, insignia, identifiers, and names''. Part 5. AMENDMENTS TO CIVIL FALSE CLAIMS ACT SEC. 5441. AMENDMENTS TO CIVIL FALSE CLAIMS ACT. Section 3729 of title 31, United States Code, is amended (1) in subsection (a)(7), by inserting ``or to a health plan,'' after ``property to the Government,''; (2) in the matter following subsection (a)(7), by inserting ``or health plan'' before ``sustains because of the act of that person,'' ; (3) at the end of the first sentence of subsection (a), by inserting ``or health plan'' before ``sustains because of the act of the person.'' ; (4) in subsection (c) (A) by inserting ``the term'' after ``section,''; and (B) by adding at the end the following: ``The term also includes any request or demand, whether under contract of otherwise, for money or property which is made or presented to a health plan.'' ; and (5) by adding at the end the following: ``(f) Health Plan Defined. For purposes of this section, the term `health plan' has the meaning given such term under section 1400 of the Health Security Act.''. Subtitle F. McCarran-Ferguson Reform SEC. 5501. REPEAL OF EXEMPTION FOR HEALTH INSURANCE. (a) In General. Section 3 of the Act of March 9, 1945 (15 U.S.C. 1013), known as the McCarran-Ferguson Act, is amended by adding at the end the following: ``(c) Notwithstanding that the business of insurance is regulated by State law, nothing in this Act shall limit the applicability of the following Acts to the business of insurance to the extent that such business relates to the provision of health benefits: ``(1) The Sherman Act (15 U.S.C. 1 et seq.). ``(2) The Clayton Act (15 U.S.C. 12 et seq.). ``(3) Federal Trade Commission Act (15 U.S.C. 41 et seq.). ``(4) The Act of June 19, 1936 (49 Stat. 1526; 15 U.S.C. 21a et seq.), known as the Robinson-Patman Antidiscrimination Act.''. (b) Effective Date. The amendment made by subsection (a) shall take effect on the first day of the sixth month beginning after the date of the enactment of this Act.