Public Option Deficit Reduction Act

I 117TH CONGRESS 1ST SESSION H. R. 2010 To amend the Patient Protection and Affordable Care Act to establish a public health insurance option. IN THE HOUSE OF REPRESENTATIVES MARCH 18, 2021 Mr. DEFAZIO introduced the following bill; which was referred to the Committee on Energy and Commerce A BILL To amend the Patient Protection and Affordable Care Act to establish a public health insurance option. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Public Option Deficit 4 Reduction Act’’. 5 SEC. 2. PUBLIC HEALTH INSURANCE OPTION. 6 (a) IN GENERAL.—Part 3 of subtitle D of title I of 7 the Patient Protection and Affordable Care Act (Public 8 Law 111–148) is amended by adding at the end the fol- 9 lowing new section: 10 VerDate Sep 11 2014 02:16 May 18, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H2010.IH H2010 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 2010 IH ‘‘SEC. 1325. PUBLIC HEALTH INSURANCE OPTION. 1 ‘‘(a) ESTABLISHMENT AND ADMINISTRATION OF A 2 PUBLIC HEALTH INSURANCE OPTION.— 3 ‘‘(1) ESTABLISHMENT.—For years beginning 4 with 2022, the Secretary of Health and Human 5 Services (in this subtitle referred to as the ‘Sec- 6 retary’) shall provide for the offering through Ex- 7 changes established under this title of a health bene- 8 fits plan (in this Act referred to as the ‘public health 9 insurance option’) that ensures choice, competition, 10 and stability of affordable, high-quality coverage 11 throughout the United States in accordance with 12 this section. In designing the option, the Secretary’s 13 primary responsibility is to create a low-cost plan 14 without compromising quality or access to care. 15 ‘‘(2) OFFERING THROUGH EXCHANGES.— 16 ‘‘(A) EXCLUSIVE TO EXCHANGES.—The 17 public health insurance option shall only be 18 made available through Exchanges established 19 under this title. 20 ‘‘(B) ENSURING A LEVEL PLAYING 21 FIELD.—Consistent with this section, the public 22 health insurance option shall comply with re- 23 quirements that are applicable under this title 24 to health benefits plans offered through such 25 Exchanges, including requirements related to 26 VerDate Sep 11 2014 02:16 May 18, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H2010.IH H2010 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 2010 IH benefits, benefit levels, provider networks, no- 1 tices, consumer protections, and cost sharing. 2 ‘‘(C) PROVISION OF BENEFIT LEVELS.— 3 The public health insurance option— 4 ‘‘(i) shall offer bronze, silver, and gold 5 plans; and 6 ‘‘(ii) may offer platinum plans. 7 ‘‘(3) ADMINISTRATIVE CONTRACTING.—The 8 Secretary may enter into contracts for the purpose 9 of performing administrative functions (including 10 functions described in subsection (a)(4) of section 11 1874A of the Social Security Act) with respect to 12 the public health insurance option in the same man- 13 ner as the Secretary may enter into contracts under 14 subsection (a)(1) of such section. The Secretary has 15 the same authority with respect to the public health 16 insurance option as the Secretary has under sub- 17 sections (a)(1) and (b) of section 1874A of the So- 18 cial Security Act with respect to title XVIII of such 19 Act. Contracts under this subsection shall not in- 20 volve the transfer of insurance risk to such entity. 21 ‘‘(4) OMBUDSMAN.—The Secretary shall estab- 22 lish an office of the ombudsman for the public 23 health insurance option which shall have duties with 24 respect to the public health insurance option similar 25 VerDate Sep 11 2014 02:16 May 18, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2010.IH H2010 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 2010 IH to the duties of the Medicare Beneficiary Ombuds- 1 man under section 1808(c)(2) of the Social Security 2 Act. In addition, such office shall work with States 3 to ensure that information and notice is provided 4 that the public health insurance option is one of the 5 health plans available through an Exchange. 6 ‘‘(5) DATA COLLECTION.—The Secretary shall 7 collect such data as may be required to establish 8 premiums and payment rates for the public health 9 insurance option and for other purposes under this 10 section, including to improve quality and to reduce 11 racial, ethnic, and other disparities in health and 12 health care. 13 ‘‘(6) ACCESS TO FEDERAL COURTS.—The provi- 14 sions of Medicare (and related provisions of title II 15 of the Social Security Act) relating to access of 16 Medicare beneficiaries to Federal courts for the en- 17 forcement of rights under Medicare, including with 18 respect to amounts in controversy, shall apply to the 19 public health insurance option and individuals en- 20 rolled under such option under this title in the same 21 manner as such provisions apply to Medicare and 22 Medicare beneficiaries. 23 ‘‘(b) PREMIUMS AND FINANCING.— 24 ‘‘(1) ESTABLISHMENT OF PREMIUMS.— 25 VerDate Sep 11 2014 02:16 May 18, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H2010.IH H2010 kjohnson on DSK79L0C42PROD with BILLS 5 •HR 2010 IH ‘‘(A) IN GENERAL.—The Secretary shall 1 establish geographically adjusted premium rates 2 for the public health insurance option— 3 ‘‘(i) in a manner that complies with 4 the premium rules under paragraph (3); 5 and 6 ‘‘(ii) at a level sufficient to fully fi- 7 nance the costs of— 8 ‘‘(I) health benefits provided by 9 the public health insurance option; 10 and 11 ‘‘(II) administrative costs related 12 to operating the public health insur- 13 ance option. 14 ‘‘(B) CONTINGENCY MARGIN.—In estab- 15 lishing premium rates under subparagraph (A), 16 the Secretary shall include an appropriate 17 amount for a contingency margin. 18 ‘‘(2) ACCOUNT.— 19 ‘‘(A) ESTABLISHMENT.—There is estab- 20 lished in the Treasury of the United States an 21 account for the receipts and disbursements at- 22 tributable to the operation of the public health 23 insurance option, including the start-up funding 24 under subparagraph (B). Section 1854(g) of 25 VerDate Sep 11 2014 02:16 May 18, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H2010.IH H2010 kjohnson on DSK79L0C42PROD with BILLS 6 •HR 2010 IH the Social Security Act shall apply to receipts 1 described in the previous sentence in the same 2 manner as such section applies to payments or 3 premiums described in such section. 4 ‘‘(B) START-UP FUNDING.— 5 ‘‘(i) IN GENERAL.—In order to pro- 6 vide for the establishment of the public 7 health insurance option there is hereby ap- 8 propriated to the Secretary, out of any 9 funds in the Treasury not otherwise appro- 10 priated, $2,000,000,000. In order to pro- 11 vide for initial claims reserves before the 12 collection of premiums, there is hereby ap- 13 propriated to the Secretary, out of any 14 funds in the Treasury not otherwise appro- 15 priated, such sums as necessary to cover 16 90 days worth of claims reserves based on 17 projected enrollment. 18 ‘‘(ii) AMORTIZATION OF START-UP 19 FUNDING.—The Secretary shall provide for 20 the repayment of the start-up funding pro- 21 vided under clause (i) to the Treasury in 22 an amortized manner over the 10-year pe- 23 riod beginning with 2022. 24 VerDate Sep 11 2014 02:16 May 18, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H2010.IH H2010 kjohnson on DSK79L0C42PROD with BILLS 7 •HR 2010 IH ‘‘(iii) LIMITATION ON FUNDING.— 1 Nothing in this subsection shall be con- 2 strued as authorizing any additional appro- 3 priations to the account, other than such 4 amounts as are otherwise provided with re- 5 spect to other health benefits plans partici- 6 pating under the Exchange involved. 7 ‘‘(3) INSURANCE RATING RULES.—The pre- 8 mium rate charged for the public health insurance 9 option may not vary except as provided under sec- 10 tion 2701 of the Public Health Service Act. 11 ‘‘(c) PAYMENT RATES FOR ITEMS AND SERVICES.— 12 ‘‘(1) RATES ESTABLISHED BY SECRETARY.— 13 ‘‘(A) IN GENERAL.—The Secretary shall 14 establish payment rates for the public health in- 15 surance option for services and health care pro- 16 viders consistent with this subsection and may 17 change such payment rates in accordance with 18 subsection (d). 19 ‘‘(B) INITIAL PAYMENT RULES.— 20 ‘‘(i) IN GENERAL.—During 2022, 21 2023, and 2024, the Secretary shall set 22 the payment rates under this subsection 23 for services and providers described in sub- 24 paragraph (A) equal to the payment rates 25 VerDate Sep 11 2014 02:16 May 18, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H2010.IH H2010 kjohnson on DSK79L0C42PROD with BILLS 8 •HR 2010 IH for equivalent services and providers under 1 parts A and B of Medicare, subject to 2 clause (ii), paragraphs (2)(A) and (4), and 3 subsection (d). 4 ‘‘(ii) EXCEPTIONS.— 5 ‘‘(I) PRACTITIONERS’ SERV- 6 ICES.—Payment rates for practi- 7 tioners’ services otherwise established 8 under the fee schedule under section 9 1848 of the Social Security Act shall 10 be applied without regard to the pro- 11 visions under subsection (f) of such 12 section and the update under sub- 13 section (d)(4) under such section for a 14 year as applied under this paragraph 15 shall be not less than 1 percent. 16 ‘‘(II) ADJUSTMENTS.—The Sec- 17 retary may determine the extent to 18 which Medicare adjustments applica- 19 ble to base payment rates under parts 20 A and B of Medicare for graduate 21 medical education and dispropor- 22 tionate share hospitals shall apply 23 under this section. 24 VerDate Sep 11 2014 02:16 May 18, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H2010.IH H2010 kjohnson on DSK79L0C42PROD with BILLS 9 •HR 2010 IH ‘‘(C) FOR NEW SERVICES.—The Secretary 1 shall modify payment rates described in sub- 2 paragraph (B) in order to accommodate pay- 3 ments for services, such as well-child visits, that 4 are not otherwise covered under Medicare. 5 ‘‘(D) PRESCRIPTION DRUGS.—Payment 6 rates under this subsection for prescription 7 drugs that are not paid for under part A or 8 part B of Medicare shall be at rates negotiated 9 by the Secretary. 10 ‘‘(2) INCENTIVES FOR PARTICIPATING PRO- 11 VIDERS.— 12 ‘‘(A) INITIAL INCENTIVE PERIOD.— 13 ‘‘(i) IN GENERAL.—The Secretary 14 shall provide, in the case of services de- 15 scribed in clause (ii) furnished during 16 2022, 2023, and 2024, for payment rates 17 that are 5 percent greater than the rates 18 established under paragraph (1). 19 ‘‘(ii) SERVICES DESCRIBED.—The 20 services described in this clause are items 21 and professional services, under the public 22 health insurance option by a physician or 23 other health care practitioner who partici- 24 VerDate Sep 11 2014 02:16 May 18, 2021 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H2010.IH H2010 kjohnson on DSK79L0C42PROD with BILLS 10 •HR 2010 IH pates in both Medicare and the public 1 health insurance option. 2 ‘‘(iii) SPECIAL RULES.—A pediatrician 3 and any other health care practitioner who 4 is a type of practitioner that does not typi- 5 cally participate in Medicare (as deter- 6 mined by the Secretary) shall also be eligi- 7 ble for the increased payment rates under 8 clause (i). 9 ‘‘(B) SUBSEQUENT PERIODS.—Beginning 10 with 2025 and for subsequent years, the Sec- 11 retary shall continue to use an administrative 12 process to set such rates in order to promote 13 payment accuracy, to ensure adequate bene- 14 ficiary access to providers, and to promote af- 15 fordability and the efficient delivery of medical 16 care consistent with subsection (a)(1). Such 17 rates shall not be set at levels expected to in- 18 crease average medical costs per enrollee cov- 19 ered under the public health insurance option 20 beyond what would be expected if the process 21 under paragraph (1)(B) and subparagraph (A) 22 were continued, as certified by the Office of the 23 Actuary of the Centers for Medicare & Medicaid 24 Services. 25 VerDate Sep 11 2014 02:16 May 18, 2021 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H2010.IH H2010 kjohnson on DSK79L0C42PROD with BILLS 11 •HR 2010 IH ‘‘(C) ESTABLISHMENT OF A PROVIDER 1 NETWORK.—Health care providers participating 2 under Medicare are participating providers in 3 the public health insurance option unless they 4 opt out in a process established by the Sec- 5 retary. 6 ‘‘(3) ADMINISTRATIVE PROCESS FOR SETTING 7 RATES.—Chapter 5 of title 5, United States Code, 8 shall apply to the process for the initial establish- 9 ment of payment rates under this subsection but not 10 to the specific methodology for establishing such 11 rates or the calculation of such rates. 12 ‘‘(4) CONSTRUCTION.—Nothing in this section 13 shall be construed as limiting the Secretary’s author- 14 ity to correct for payments that are excessive or defi- 15 cient, taking into account the provisions of sub- 16 section (a)(1) and any appropriate adjustments 17 based on the demographic characteristics of enrollees 18 covered under the public health insurance option, 19 but in no case shall the correction of payments 20 under this paragraph result in a level of expendi- 21 tures per enrollee that exceeds the level of expendi- 22 tures that would have occurred under paragraphs 23 (1)(B) and (2)(A), as certified by the Office of the 24 VerDate Sep 11 2014 02:16 May 18, 2021 Jkt 019200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H2010.IH H2010 kjohnson on DSK79L0C42PROD with BILLS 12 •HR 2010 IH Actuary of the Centers for Medicare & Medicaid 1 Services. 2 ‘‘(5) CONSTRUCTION.—Nothing in this section 3 shall be construed as affecting the authority of the 4 Secretary to establish payment rates, including pay- 5 ments to provide for the more efficient delivery of 6 services, such as the initiatives provided for under 7 subsection (d). 8 ‘‘(6) LIMITATIONS ON REVIEW.—There shall be 9 no administrative or judicial review of a payment 10 rate or methodology established under this sub- 11 section or under subsection (d). 12 ‘‘(d) MODERNIZED PAYMENT INITIATIVES AND DE- 13 LIVERY SYSTEM REFORM.— 14 ‘‘(1) IN GENERAL.—For plan years beginning 15 with 2022, the Secretary may utilize innovative pay- 16 ment mechanisms and policies to determine pay- 17 ments for items and services under the public health 18 insurance option. The payment mechanisms and 19 policies under this subsection may include patient- 20 centered medical home and other care management 21 payments, accountable care organizations, value- 22 based purchasing, bundling of services, differential 23 payment rates, performance or utilization based pay- 24 ments, partial capitation, and direct contracting with 25 VerDate Sep 11 [Text truncated for display. Full text available on Congress.gov.]