Healthy Competition for Better Care Act

II 118TH CONGRESS 1ST SESSION S. 1451 To ban anticompetitive terms in facility and insurance contracts that limit access to higher quality, lower cost care. IN THE SENATE OF THE UNITED STATES MAY 4, 2023 Mr. BRAUN (for himself and Ms. BALDWIN) introduced the following bill; which was read twice and referred to the Committee on Health, Edu- cation, Labor, and Pensions A BILL To ban anticompetitive terms in facility and insurance contracts that limit access to higher quality, lower cost care. 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 ‘‘Healthy Competition 4 for Better Care Act’’. 5 SEC. 2. BANNING ANTICOMPETITIVE TERMS IN FACILITY 6 AND INSURANCE CONTRACTS THAT LIMIT AC- 7 CESS TO HIGHER QUALITY, LOWER COST 8 CARE. 9 (a) IN GENERAL.— 10 VerDate Sep 11 2014 03:15 May 13, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S1451.IS S1451 pbinns on DSKJLVW7X2PROD with $$_JOB 2 •S 1451 IS (1) PHSA.—Section 2799A–9 of the Public 1 Health Service Act (42 U.S.C. 300gg–119) is 2 amended by adding at the end the following: 3 ‘‘(b) PROTECTING HEALTH PLANS NETWORK DE- 4 SIGN FLEXIBILITY.— 5 ‘‘(1) IN GENERAL.—A group health plan or a 6 health insurance issuer offering group or individual 7 health insurance coverage shall not enter into an 8 agreement with a provider, network or association of 9 providers, or other service provider offering access to 10 a network of service providers if such agreement, di- 11 rectly or indirectly— 12 ‘‘(A) restricts the group health plan or 13 health insurance issuer from— 14 ‘‘(i) directing or steering enrollees to 15 other health care providers; or 16 ‘‘(ii) offering incentives to encourage 17 enrollees to utilize specific health care pro- 18 viders; 19 ‘‘(B) requires the group health plan or 20 health insurance issuer to enter into any addi- 21 tional contract with an affiliate of the provider 22 as a condition of entering into a contract with 23 such provider; 24 VerDate Sep 11 2014 03:15 May 13, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S1451.IS S1451 pbinns on DSKJLVW7X2PROD with $$_JOB 3 •S 1451 IS ‘‘(C) requires the group health plan or 1 health insurance issuer to agree to payment 2 rates or other terms for any affiliate not party 3 to the contract of the provider involved; or 4 ‘‘(D) restricts other group health plans or 5 health insurance issuers not party to the con- 6 tract, from paying a lower rate for items or 7 services than the contracting plan or issuer 8 pays for such items or services. 9 ‘‘(2) ADDITIONAL REQUIREMENT FOR SELF-IN- 10 SURED PLANS.—A self-insured group health plan 11 shall not enter into an agreement with a provider, 12 network or association of providers, third-party ad- 13 ministrator, or other service provider offering access 14 to a network of providers if such agreement directly 15 or indirectly requires the group health plan to cer- 16 tify, attest, or otherwise confirm in writing that the 17 group health plan is bound by restrictive contracting 18 terms between the service provider and a third-party 19 administrator that the group health plan is not 20 party to, without a disclosure that such terms exist. 21 ‘‘(3) EXCEPTION FOR CERTAIN GROUP MODEL 22 ISSUERS.—Paragraph (1)(A) shall not apply to a 23 group health plan or health insurance issuer offering 24 VerDate Sep 11 2014 03:15 May 13, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S1451.IS S1451 pbinns on DSKJLVW7X2PROD with $$_JOB 4 •S 1451 IS group or individual health insurance coverage with 1 respect to— 2 ‘‘(A) a health maintenance organization 3 (as defined in section 2791(b)(3)), if such 4 health maintenance organization operates pri- 5 marily through exclusive contracts with multi- 6 specialty physician groups, nor to any arrange- 7 ment between such a health maintenance orga- 8 nization and its affiliates; or 9 ‘‘(B) a value-based network arrangement, 10 such as an exclusive provider network, account- 11 able care organization or other alternative pay- 12 ment model, center of excellence, a provider 13 sponsored health insurance issuer that operates 14 primarily through aligned multi-specialty physi- 15 cian group practices or integrated health sys- 16 tems, or such other similar network arrange- 17 ments as determined by the Secretary through 18 rulemaking. 19 ‘‘(4) ATTESTATION.—A group health plan or 20 health insurance issuer offering group or individual 21 health insurance coverage shall annually submit to, 22 as applicable, the applicable authority described in 23 section 2723 or the Secretary of Labor, an attesta- 24 VerDate Sep 11 2014 03:15 May 13, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S1451.IS S1451 pbinns on DSKJLVW7X2PROD with $$_JOB 5 •S 1451 IS tion that such plan or issuer is in compliance with 1 the requirements of this subsection. 2 ‘‘(c) MAINTENANCE OF EXISTING HIPAA, GINA, 3 AND ADA PROTECTIONS.—Nothing in this section shall 4 modify, reduce, or eliminate the existing privacy protec- 5 tions and standards provided by reason of State and Fed- 6 eral law, including the requirements of parts 160 and 164 7 of title 45, Code of Federal Regulations (or any successor 8 regulations). 9 ‘‘(d) REGULATIONS.—The Secretary, in consultation 10 with the Secretary of Labor and the Secretary of the 11 Treasury, not later than 1 year after the date of enact- 12 ment of this section, shall promulgate regulations to carry 13 out this section. 14 ‘‘(e) RULE OF CONSTRUCTION.—Nothing in this sec- 15 tion shall be construed to limit network design or cost or 16 quality initiatives by a group health plan or health insur- 17 ance issuer, including accountable care organizations, ex- 18 clusive provider organizations, networks that tier providers 19 by cost or quality or steer enrollees to centers of excel- 20 lence, or other pay-for-performance programs. 21 ‘‘(f) CLARIFICATION WITH RESPECT TO ANTITRUST 22 LAWS.—Compliance with this section does not constitute 23 compliance with the antitrust laws, as defined in sub- 24 VerDate Sep 11 2014 03:15 May 13, 2023 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S1451.IS S1451 pbinns on DSKJLVW7X2PROD with $$_JOB 6 •S 1451 IS section (a) of the first section of the Clayton Act (15 1 U.S.C. 12(a)).’’. 2 (2) ERISA.—Section 724 of the Employee Re- 3 tirement Income Security Act of 1974 (29 U.S.C. 4 1185m) is amended by adding at the end the fol- 5 lowing: 6 ‘‘(b) PROTECTING HEALTH PLANS NETWORK DE- 7 SIGN FLEXIBILITY.— 8 ‘‘(1) IN GENERAL.—A group health plan or a 9 health insurance issuer offering group health insur- 10 ance coverage shall not enter into an agreement with 11 a provider, network or association of providers, or 12 other service provider offering access to a network of 13 service providers if such agreement, directly or indi- 14 rectly— 15 ‘‘(A) restricts the group health plan or 16 health insurance issuer from— 17 ‘‘(i) directing or steering enrollees to 18 other health care providers; or 19 ‘‘(ii) offering incentives to encourage 20 enrollees to utilize specific health care pro- 21 viders; 22 ‘‘(B) requires the group health plan or 23 health insurance issuer to enter into any addi- 24 tional contract with an affiliate of the provider 25 VerDate Sep 11 2014 03:15 May 13, 2023 Jkt 039200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S1451.IS S1451 pbinns on DSKJLVW7X2PROD with $$_JOB 7 •S 1451 IS as a condition of entering into a contract with 1 such provider; 2 ‘‘(C) requires the group health plan or 3 health insurance issuer to agree to payment 4 rates or other terms for any affiliate not party 5 to the contract of the provider involved; or 6 ‘‘(D) restricts other group health plans or 7 health insurance issuers not party to the con- 8 tract, from paying a lower rate for items or 9 services than the contracting plan or issuer 10 pays for such items or services. 11 ‘‘(2) ADDITIONAL REQUIREMENT FOR SELF-IN- 12 SURED PLANS.—A self-insured group health plan 13 shall not enter into an agreement with a provider, 14 network or association of providers, third-party ad- 15 ministrator, or other service provider offering access 16 to a network of providers if such agreement directly 17 or indirectly requires the group health plan to cer- 18 tify, attest, or otherwise confirm in writing that the 19 group health plan is bound by restrictive contracting 20 terms between the service provider and a third-party 21 administrator that the group health plan is not 22 party to, without a disclosure that such terms exist. 23 ‘‘(3) EXCEPTION FOR CERTAIN GROUP MODEL 24 ISSUERS.—Paragraph (1)(A) shall not apply to a 25 VerDate Sep 11 2014 03:15 May 13, 2023 Jkt 039200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S1451.IS S1451 pbinns on DSKJLVW7X2PROD with $$_JOB 8 •S 1451 IS group health plan or health insurance issuer offering 1 group health insurance coverage with respect to— 2 ‘‘(A) a health maintenance organization 3 (as defined in section 733(b)(3)), if such health 4 maintenance organization operates primarily 5 through exclusive contracts with multi-specialty 6 physician groups, nor to any arrangement be- 7 tween such a health maintenance organization 8 and its affiliates; or 9 ‘‘(B) a value-based network arrangement, 10 such as an exclusive provider network, account- 11 able care organization or other alternative pay- 12 ment model, center of excellence, a provider 13 sponsored health insurance issuer that operates 14 primarily through aligned multi-specialty physi- 15 cian group practices or integrated health sys- 16 tems, or such other similar network arrange- 17 ments as determined by the Secretary through 18 rulemaking. 19 ‘‘(4) ATTESTATION.—A group health plan or 20 health insurance issuer offering group health insur- 21 ance coverage shall annually submit to the Secretary 22 of Labor an attestation that such plan or issuer is 23 in compliance with the requirements of this sub- 24 section. 25 VerDate Sep 11 2014 03:15 May 13, 2023 Jkt 039200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S1451.IS S1451 pbinns on DSKJLVW7X2PROD with $$_JOB 9 •S 1451 IS ‘‘(c) MAINTENANCE OF EXISTING HIPAA, GINA, 1 AND ADA PROTECTIONS.—Nothing in this section shall 2 modify, reduce, or eliminate the existing privacy protec- 3 tions and standards provided by reason of State and Fed- 4 eral law, including the requirements of parts 160 and 164 5 of title 45, Code of Federal Regulations (or any successor 6 regulations). 7 ‘‘(d) REGULATIONS.—The Secretary, in consultation 8 with the Secretary of Health and Human Services and the 9 Secretary of the Treasury, not later than 1 year after the 10 date of enactment of this section, shall promulgate regula- 11 tions to carry out this section. 12 ‘‘(e) RULE OF CONSTRUCTION.—Nothing in this sec- 13 tion shall be construed to limit network design or cost or 14 quality initiatives by a group health plan or health insur- 15 ance issuer, including accountable care organizations, ex- 16 clusive provider organizations, networks that tier providers 17 by cost or quality or steer enrollees to centers of excel- 18 lence, or other pay-for-performance programs. 19 ‘‘(f) CLARIFICATION WITH RESPECT TO ANTITRUST 20 LAWS.—Compliance with this section does not constitute 21 compliance with the antitrust laws, as defined in sub- 22 section (a) of the first section of the Clayton Act (15 23 U.S.C. 12(a)).’’. 24 VerDate Sep 11 2014 03:15 May 13, 2023 Jkt 039200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S1451.IS S1451 pbinns on DSKJLVW7X2PROD with $$_JOB 10 •S 1451 IS (3) IRC.—Section 9824 of the Internal Rev- 1 enue Code of 1986 is amended by adding at the end 2 the following: 3 ‘‘(b) PROTECTING HEALTH PLANS NETWORK DE- 4 SIGN FLEXIBILITY.— 5 ‘‘(1) IN GENERAL.—A group health plan shall 6 not enter into an agreement with a provider, net- 7 work or association of providers, or other service 8 provider offering access to a network of service pro- 9 viders if such agreement, directly or indirectly— 10 ‘‘(A) restricts the group health plan 11 from— 12 ‘‘(i) directing or steering enrollees to 13 other health care providers; or 14 ‘‘(ii) offering incentives to encourage 15 enrollees to utilize specific health care pro- 16 viders; 17 ‘‘(B) requires the group health plan to 18 enter into any additional contract with an affil- 19 iate of the provider as a condition of entering 20 into a contract with such provider; 21 ‘‘(C) requires the group health plan to 22 agree to payment rates or other terms for any 23 affiliate not party to the contract of the pro- 24 vider involved; or 25 VerDate Sep 11 2014 03:15 May 13, 2023 Jkt 039200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S1451.IS S1451 pbinns on DSKJLVW7X2PROD with $$_JOB 11 •S 1451 IS ‘‘(D) restricts other group health plans not 1 party to the contract, from paying a lower rate 2 for items or services than the contracting plan 3 pays for such items or services. 4 ‘‘(2) ADDITIONAL REQUIREMENT FOR SELF-IN- 5 SURED PLANS.—A self-insured group health plan 6 shall not enter into an agreement with a provider, 7 network or association of providers, third-party ad- 8 ministrator, or other service provider offering access 9 to a network of providers if such agreement directly 10 or indirectly requires the group health plan to cer- 11 tify, attest, or otherwise confirm in writing that the 12 group health plan is bound by restrictive contracting 13 terms between the service provider and a third-party 14 administrator that the group health plan is not 15 party to, without a disclosure that such terms exist. 16 ‘‘(3) EXCEPTION FOR CERTAIN GROUP MODEL 17 ISSUERS.—Paragraph (1)(A) shall not apply to a 18 group health plan with respect to— 19 ‘‘(A) a health maintenance organization 20 (as defined in section 9832(b)(3)), if such 21 health maintenance organization operates pri- 22 marily through exclusive contracts with multi- 23 specialty physician groups, nor to any arrange- 24 VerDate Sep 11 2014 03:15 May 13, 2023 Jkt 039200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S1451.IS S1451 pbinns on DSKJLVW7X2PROD with $$_JOB 12 •S 1451 IS ment between such a health maintenance orga- 1 nization and its affiliates; or 2 ‘‘(B) a value-based network arrangement, 3 such as an exclusive provider network, account- 4 able care organization or other alternative pay- 5 ment model, center of excellence, a provider 6 sponsored health insurance issuer that operates 7 primarily through aligned multi-specialty physi- 8 cian group practices or integrated health sys- 9 tems, or such other similar network arrange- 10 ments as determined by the Secretary through 11 rulemaking. 12 ‘‘(4) ATTESTATION.—A gro [Text truncated for display. 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