Patient Protection and Affordable Care Enhancement Act

II Calendar No. 523 116TH CONGRESS 2D SESSION H. R. 1425 IN THE SENATE OF THE UNITED STATES JUNE 30, 2020 Received AUGUST 13, 2020 Read the first time SEPTEMBER 8, 2020 Read the second time and placed on the calendar AN ACT To amend the Patient Protection and Affordable Care Act to provide for a Improve Health Insurance Affordability Fund to provide for certain reinsurance payments to lower premiums in the individual health insurance mar- ket. 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 ‘‘Patient Protection and 4 Affordable Care Enhancement Act’’. 5 VerDate Sep 11 2014 23:15 Sep 08, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H1425.PCS H1425 pamtmann on DSKBC07HB2PROD with BILLS 2 HR 1425 PCS SEC. 2. TABLE OF CONTENTS. 1 The table of contents for this Act is as follows: 2 Sec. 1. Short title. Sec. 2. Table of contents. TITLE I—LOWERING HEALTH CARE COSTS AND PROTECTING PEOPLE WITH PREEXISTING CONDITIONS Sec. 101. Improving affordability by expanding premium assistance for con- sumers. Sec. 102. Improving affordability by reducing out-of-pocket and premium costs for consumers. Sec. 103. Expanding affordability for working families to fix the family glitch. Sec. 104. Tax credit reconciliation protections for individuals receiving social security lump-sum payments. Sec. 105. Preserving State option to implement health care Marketplaces. Sec. 106. Establishing a Health Insurance Affordability Fund. Sec. 107. Rescinding the short-term limited duration insurance regulation. Sec. 108. Revoking section 1332 guidance. Sec. 109. Requiring Marketplace outreach, educational activities, and annual enrollment targets. Sec. 110. Report on effects of website maintenance during open enrollment. Sec. 111. Promoting consumer outreach and education. Sec. 112. Improving transparency and accountability in the Marketplace. Sec. 113. Improving awareness of health coverage options. Sec. 114. Promoting State innovations to expand coverage. Sec. 115. Strengthening network adequacy. Sec. 116. Protecting consumers from unreasonable rate hikes. Sec. 117. Eligibility of DACA recipients for qualified health plans offered through Exchanges. TITLE II—ENCOURAGING MEDICAID EXPANSION AND STRENGTHENING THE MEDICAID PROGRAM Sec. 201. Incentivizing Medicaid expansion. Sec. 202. Providing 12-months of continuous eligibility for Medicaid and CHIP. Sec. 203. Mandatory 12-months of postpartum Medicaid eligibility. Sec. 204. Reducing the administrative FMAP for nonexpansion States. Sec. 205. Enhanced reporting requirements for nonexpansion states. Sec. 206. Primary care pay increase. Sec. 207. Permanent funding for CHIP. Sec. 208. Permanent extension of CHIP enrollment and quality measures. Sec. 209. State option to increase children’s eligibility for Medicaid and CHIP. Sec. 210. Medicaid coverage for citizens of Freely Associated States. Sec. 211. Extension of full Federal medical assistance percentage to Indian health care providers. TITLE III—LOWERING PRICES THROUGH FAIR DRUG PRICE NEGOTIATION Sec. 301. Establishing a Fair Drug Pricing Program. Sec. 302. Drug manufacturer excise tax for noncompliance. Sec. 303. Fair Price Negotiation Implementation Fund. VerDate Sep 11 2014 23:15 Sep 08, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6211 E:\BILLS\H1425.PCS H1425 pamtmann on DSKBC07HB2PROD with BILLS 3 HR 1425 PCS TITLE IV—PUBLIC HEALTH INVESTMENTS Sec. 401. Supporting increased innovation. TITLE I—LOWERING HEALTH 1 CARE COSTS AND PRO- 2 TECTING PEOPLE WITH PRE- 3 EXISTING CONDITIONS 4 SEC. 101. IMPROVING AFFORDABILITY BY EXPANDING PRE- 5 MIUM ASSISTANCE FOR CONSUMERS. 6 (a) IN GENERAL.—Section 36B(b)(3)(A) of the In- 7 ternal Revenue Code of 1986 is amended to read as fol- 8 lows: 9 ‘‘(A) APPLICABLE PERCENTAGE.—The ap- 10 plicable percentage for any taxable year shall be 11 the percentage such that the applicable percent- 12 age for any taxpayer whose household income is 13 within an income tier specified in the following 14 table shall increase, on a sliding scale in a lin- 15 ear manner, from the initial premium percent- 16 age to the final premium percentage specified in 17 such table for such income tier: 18 ‘‘In the case of household income (expressed as a percent of poverty line) within the following income tier: The initial premium percentage is— The final premium percentage is— Up to 150.0 percent ................................... 0.0 0.0 150.0 percent up to 200.0 percent ............. 0.0 3.0 200.0 percent up to 250.0 percent ............. 3.0 4.0 250.0 percent up to 300.0 percent ............. 4.0 6.0 300.0 percent up to 400.0 percent ............. 6.0 8.5 400.0 percent and higher ........................... 8.5 8.5’’. VerDate Sep 11 2014 23:15 Sep 08, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H1425.PCS H1425 pamtmann on DSKBC07HB2PROD with BILLS 4 HR 1425 PCS (b) CONFORMING AMENDMENT.—Section 1 36B(c)(1)(A) of the Internal Revenue Code of 1986 is 2 amended by striking ‘‘but does not exceed 400 percent’’. 3 (c) EFFECTIVE DATE.—The amendments made by 4 this section shall apply to taxable years beginning after 5 December 31, 2019. 6 SEC. 102. IMPROVING AFFORDABILITY BY REDUCING OUT- 7 OF-POCKET AND PREMIUM COSTS FOR CON- 8 SUMERS. 9 Section 1302(c)(4) of the Patient Protection and Af- 10 fordable Care Act (42 U.S.C. 18022(c)(4)) is amended by 11 striking ‘‘calendar year)’’ and inserting ‘‘calendar year, 12 based on estimates and projections for the applicable cal- 13 endar year of the percentage (if any) by which the average 14 per enrollee premium for eligible employer-sponsored 15 health plans (as defined in section 5000A(f)(2) of the In- 16 ternal Revenue Code of 1986) exceeds such average per 17 enrollee premium for the preceding calendar year, as pub- 18 lished in the National Health Expenditure Accounts)’’. 19 SEC. 103. EXPANDING AFFORDABILITY FOR WORKING FAM- 20 ILIES TO FIX THE FAMILY GLITCH. 21 (a) IN GENERAL.—Clause (i) of section 36B(c)(2)(C) 22 of the Internal Revenue Code of 1986 is amended to read 23 as follows: 24 VerDate Sep 11 2014 23:15 Sep 08, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H1425.PCS H1425 pamtmann on DSKBC07HB2PROD with BILLS 5 HR 1425 PCS ‘‘(i) COVERAGE MUST BE AFFORD- 1 ABLE.— 2 ‘‘(I) EMPLOYEES.—An employee 3 shall not be treated as eligible for 4 minimum essential coverage if such 5 coverage consists of an eligible em- 6 ployer-sponsored plan (as defined in 7 section 5000A(f)(2)) and the employ- 8 ee’s required contribution (within the 9 meaning of section 5000A(e)(1)(B)) 10 with respect to the plan exceeds 9.5 11 percent of the employee’s household 12 income. 13 ‘‘(II) FAMILY MEMBERS.—An in- 14 dividual who is eligible to enroll in an 15 eligible employer-sponsored plan (as 16 defined in section 5000A(f)(2)) by 17 reason of a relationship the individual 18 bears to the employee shall not be 19 treated as eligible for minimum essen- 20 tial coverage by reason of such eligi- 21 bility to enroll if the employee’s re- 22 quired contribution (within the mean- 23 ing of section 5000A(e)(1)(B), deter- 24 mined by substituting ‘family’ for 25 VerDate Sep 11 2014 23:15 Sep 08, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H1425.PCS H1425 pamtmann on DSKBC07HB2PROD with BILLS 6 HR 1425 PCS ‘self-only’) with respect to the plan ex- 1 ceeds 9.5 percent of the employee’s 2 household income.’’. 3 (b) CONFORMING AMENDMENTS.— 4 (1) Clause (ii) of section 36B(c)(2)(C) of the 5 Internal Revenue Code of 1986 is amended by strik- 6 ing ‘‘Except as provided in clause (iii), an employee’’ 7 and inserting ‘‘An individual’’. 8 (2) Clause (iii) of section 36B(c)(2)(C) of such 9 Code is amended by striking ‘‘the last sentence of 10 clause (i)’’ and inserting ‘‘clause (i)(II)’’. 11 (3) Clause (iv) of section 36B(c)(2)(C) of such 12 Code is amended by striking ‘‘the 9.5 percent under 13 clause (i)(II)’’ and inserting ‘‘the 9.5 percent under 14 clauses (i)(I) and (i)(II)’’. 15 (c) EFFECTIVE DATE.—The amendments made by 16 this section shall apply to taxable years beginning after 17 December 31, 2021. 18 SEC. 104. TAX CREDIT RECONCILIATION PROTECTIONS FOR 19 INDIVIDUALS RECEIVING SOCIAL SECURITY 20 LUMP-SUM PAYMENTS. 21 (a) IN GENERAL.—Section 36B(d)(2) of the Internal 22 Revenue Code of 1986 is amended by adding at the end 23 the following new subparagraph: 24 VerDate Sep 11 2014 23:15 Sep 08, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H1425.PCS H1425 pamtmann on DSKBC07HB2PROD with BILLS 7 HR 1425 PCS ‘‘(C) EXCLUSION OF PORTION OF LUMP- 1 SUM SOCIAL SECURITY BENEFITS.— 2 ‘‘(i) IN GENERAL.—The term ‘modi- 3 fied adjusted gross income’ shall not in- 4 clude so much of any lump-sum social se- 5 curity benefit payment as is attributable to 6 months ending before the beginning of the 7 taxable year. 8 ‘‘(ii) LUMP-SUM SOCIAL SECURITY 9 BENEFIT PAYMENT.—For purposes of this 10 subparagraph, the term ‘lump-sum social 11 security benefit payment’ means any pay- 12 ment of social security benefits (as defined 13 in section 86(d)(1)) which constitutes more 14 than 1 month of such benefits. 15 ‘‘(iii) ELECTION TO INCLUDE EX- 16 CLUDABLE AMOUNT.—A taxpayer may 17 elect (at such time and in such manner as 18 the Secretary may provide) to have this 19 subparagraph not apply for any taxable 20 year.’’. 21 (b) EFFECTIVE DATE.—The amendment made by 22 this section shall apply to taxable years beginning after 23 December 31, 2019. 24 VerDate Sep 11 2014 23:15 Sep 08, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H1425.PCS H1425 pamtmann on DSKBC07HB2PROD with BILLS 8 HR 1425 PCS SEC. 105. PRESERVING STATE OPTION TO IMPLEMENT 1 HEALTH CARE MARKETPLACES. 2 (a) IN GENERAL.—Section 1311 of the Patient Pro- 3 tection and Affordable Care Act (42 U.S.C. 18031) is 4 amended— 5 (1) in subsection (a)— 6 (A) in paragraph (4)(B), by striking 7 ‘‘under this subsection’’ and inserting ‘‘under 8 this paragraph or paragraph (1)’’; and 9 (B) by adding at the end the following new 10 paragraph: 11 ‘‘(6) ADDITIONAL PLANNING AND ESTABLISH- 12 MENT GRANTS.— 13 ‘‘(A) IN GENERAL.—There shall be appro- 14 priated to the Secretary, out of any moneys in 15 the Treasury not otherwise appropriated, $200 16 million to award grants to eligible States for 17 the uses described in paragraph (3). 18 ‘‘(B) DURATION AND RENEWABILITY.—A 19 grant awarded under subparagraph (A) shall be 20 for a period of 2 years and may not be renewed. 21 ‘‘(C) LIMITATION.—A grant may not be 22 awarded under subparagraph (A) after Decem- 23 ber 31, 2023. 24 ‘‘(D) ELIGIBLE STATE DEFINED.—For 25 purposes of this paragraph, the term ‘eligible 26 VerDate Sep 11 2014 23:15 Sep 08, 2020 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H1425.PCS H1425 pamtmann on DSKBC07HB2PROD with BILLS 9 HR 1425 PCS State’ means a State that, as of the date of the 1 enactment of this paragraph, is not operating 2 an Exchange (other than an Exchange de- 3 scribed in section 155.200(f) of title 45, Code 4 of Federal Regulations).’’; and 5 (2) in subsection (d)(5)(A)— 6 (A) by striking ‘‘OPERATIONS.—In estab- 7 lishing an Exchange under this section’’ and in- 8 serting ‘‘OPERATIONS.— 9 ‘‘(i) IN GENERAL.—In establishing an 10 Exchange under this section (other than in 11 establishing an Exchange pursuant to a 12 grant awarded under subsection (a)(6))’’; 13 and 14 (B) by adding at the end the following: 15 ‘‘(ii) ADDITIONAL PLANNING AND ES- 16 TABLISHMENT GRANTS.—In establishing 17 an Exchange pursuant to a grant awarded 18 under subsection (a)(6), the State shall en- 19 sure that such Exchange is self-sustaining 20 beginning on January 1, 2025, including 21 allowing the Exchange to charge assess- 22 ments or user fees to participating health 23 insurance issuers, or to otherwise generate 24 funding, to support its operations.’’. 25 VerDate Sep 11 2014 23:15 Sep 08, 2020 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H1425.PCS H1425 pamtmann on DSKBC07HB2PROD with BILLS 10 HR 1425 PCS (b) CLARIFICATION REGARDING FAILURE TO ESTAB- 1 LISH EXCHANGE OR IMPLEMENT REQUIREMENTS.—Sec- 2 tion 1321(c) of the Patient Protection and Affordable 3 Care Act (42 U.S.C. 18041(c)) is amended— 4 (1) in paragraph (1), by striking ‘‘If’’ and in- 5 serting ‘‘Subject to paragraph (3), if’’; and 6 (2) by adding at the end the following new 7 paragraph: 8 ‘‘(3) CLARIFICATION.—This subsection shall 9 not apply in the case of a State that elects to apply 10 the requirements described in subsection (a) and 11 satisfies the requirement described in subsection (b) 12 on or after January 1, 2014.’’. 13 SEC. 106. ESTABLISHING A HEALTH INSURANCE AFFORD- 14 ABILITY FUND. 15 Subtitle D of title I of the Patient Protection and 16 Affordable Care Act is amended by inserting after part 17 5 (42 U.S.C. 18061 et seq.) the following new part: 18 ‘‘PART 6—IMPROVE HEALTH INSURANCE 19 AFFORDABILITY FUND 20 ‘‘SEC. 1351. ESTABLISHMENT OF PROGRAM. 21 ‘‘There is hereby established the ‘Improve Health In- 22 surance Affordability Fund’ to be administered by the Sec- 23 retary of Health and Human Services, acting through the 24 Administrator of the Centers for Medicare & Medicaid 25 VerDate Sep 11 2014 23:15 Sep 08, 2020 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H1425.PCS H1425 pamtmann on DSKBC07HB2PROD with BILLS 11 HR 1425 PCS Services (in this section referred to as the ‘Adminis- 1 trator’), to provide funding, in accordance with this part, 2 to the 50 States and the District of Columbia (each re- 3 ferred to in this section as a ‘State’) beginning on January 4 1, 2022, for the purposes described in section 1352. 5 ‘‘SEC. 1352. USE OF FUNDS. 6 ‘‘(a) IN GENERAL.—A State shall use the funds allo- 7 cated to the State under this part for one of the following 8 purposes: 9 ‘‘(1) To provide reinsurance payments to health 10 insurance issuers with respect to individuals enrolled 11 under individual health insurance coverage (other 12 than through a plan described in subsection (b)) of- 13 fered by such issuers. 14 ‘‘(2) To provide assistance (other than through 15 payments described in paragraph (1)) to reduce out- 16 of-pocket costs, such as copayments, coinsurance, 17 premiums, and deductibles, of individuals enrolled 18 under qualified health plans offered on the indi- 19 vidual market through an Exchange. 20 ‘‘(b) EXCLUSION OF CERTAIN GRANDFATHERED AND 21 TRANSITIONAL PLANS.—For purposes of subsection (a), 22 a plan described in this subsection is the following: 23 ‘‘(1) A grandfathered health plan (as defined in 24 section 1251). 2 [Text truncated for display. Full text available on Congress.gov.]