< Back to S. 1955 (109th Congress, 2005–2006)

Text of the Health Insurance Marketplace Modernization and Affordability Act of 2006

This bill was introduced on March 15, 2006, in a previous session of Congress, but was not enacted. The text of the bill below is as of Nov 2, 2005 (Introduced).

This is not the latest text of this bill.

Source: GPO

II

109th CONGRESS

1st Session

S. 1955

IN THE SENATE OF THE UNITED STATES

November 2, 2005

(for himself, Mr. Nelson of Nebraska, and Mr. Burns) introduced the following bill; which was read twice and referred to the Committee on Health, Education, Labor, and Pensions

A BILL

To amend title I of the Employee Retirement Security Act of 1974 and the Public Health Service Act to expand health care access and reduce costs through the creation of small business health plans and through modernization of the health insurance marketplace.

1.

Short title and table of contents

(a)

Short title

This Act may be cited as the Health Insurance Marketplace Modernization and Affordability Act of 2005.

(b)

Table of contents

The table of contents is as follows:

Sec. 1. Short title and table of contents.

TITLE I—Small business health plans

Sec. 101. Rules governing small business health plans.

Sec. 102. Cooperation between Federal and State authorities.

Sec. 103. Effective date and transitional and other rules.

TITLE II—Near-term market relief

Sec. 201. Near-term market relief.

TITLE III—Harmonization of health insurance laws

Sec. 301. Health Insurance Regulatory Harmonization.

I

Small business health plans

101.

Rules governing small business health plans

(a)

In general

Subtitle B of title I of the Employee Retirement Income Security Act of 1974 is amended by adding after part 7 the following new part:

8

Rules governing small business health plans

801.

Small business health plans

(a)

In general

For purposes of this part, the term small business health plan means a fully insured group health plan whose sponsor is (or is deemed under this part to be) described in subsection (b).

(b)

Sponsorship

The sponsor of a group health plan is described in this subsection if such sponsor—

(1)

is organized and maintained in good faith, with a constitution and bylaws specifically stating its purpose and providing for periodic meetings on at least an annual basis, as a bona fide trade association, a bona fide industry association (including a rural electric cooperative association or a rural telephone cooperative association), a bona fide professional association, or a bona fide chamber of commerce (or similar bona fide business association, including a corporation or similar organization that operates on a cooperative basis (within the meaning of section 1381 of the Internal Revenue Code of 1986)), for substantial purposes other than that of obtaining or providing medical care;

(2)

is established as a permanent entity which receives the active support of its members and requires for membership payment on a periodic basis of dues or payments necessary to maintain eligibility for membership in the sponsor; and

(3)

does not condition membership, such dues or payments, or coverage under the plan on the basis of health status-related factors with respect to the employees of its members (or affiliated members), or the dependents of such employees, and does not condition such dues or payments on the basis of group health plan participation.

Any sponsor consisting of an association of entities which meet the requirements of paragraphs (1), (2), and (3) shall be deemed to be a sponsor described in this subsection.
802.

Certification of small business health plans

(a)

In general

Not later than 6 months after the date of enactment of this part, the applicable authority shall prescribe by interim final rule a procedure under which the applicable authority shall certify small business health plans which apply for certification as meeting the requirements of this part.

(b)

Requirements applicable to certified plans

a small business health plan with respect to which certification under this part is in effect shall meet the applicable requirements of this part, effective on the date of certification (or, if later, on the date on which the plan is to commence operations).

(c)

Requirements for continued certification

The applicable authority may provide by regulation for continued certification of small business health plans under this part. Such regulation shall provide for the revocation of a certification if the applicable authority finds that the small employer health plan involved is failing to comply with the requirements of this part.

(d)

Class certification for fully insured plans

The applicable authority shall establish a class certification procedure for small business health plans under which all benefits consist of health insurance coverage. Under such procedure, the applicable authority shall provide for the granting of certification under this part to the plans in each class of such small business health plans upon appropriate filing under such procedure in connection with plans in such class and payment of the prescribed fee under section 806(a).

803.

Requirements relating to sponsors and boards of trustees

(a)

Sponsor

The requirements of this subsection are met with respect to a small business health plan if the sponsor has met (or is deemed under this part to have met) the requirements of section 801(b) for a continuous period of not less than 3 years ending with the date of the application for certification under this part.

(b)

Board of trustees

The requirements of this subsection are met with respect to a small business health plan if the following requirements are met:

(1)

Fiscal control

The plan is operated, pursuant to a plan document, by a board of trustees which pursuant to a trust agreement has complete fiscal control over the plan and which is responsible for all operations of the plan.

(2)

Rules of operation and financial controls

The board of trustees has in effect rules of operation and financial controls, based on a 3-year plan of operation, adequate to carry out the terms of the plan and to meet all requirements of this title applicable to the plan.

(3)

Rules governing relationship to participating employers and to contractors

(A)

Board membership

(i)

In general

Except as provided in clauses (ii) and (iii), the members of the board of trustees are individuals selected from individuals who are the owners, officers, directors, or employees of the participating employers or who are partners in the participating employers and actively participate in the business.

(ii)

Limitation

(I)

General rule

Except as provided in subclauses (II) and (III), no such member is an owner, officer, director, or employee of, or partner in, a contract administrator or other service provider to the plan.

(II)

Limited exception for providers of services solely on behalf of the sponsor

Officers or employees of a sponsor which is a service provider (other than a contract administrator) to the plan may be members of the board if they constitute not more than 25 percent of the membership of the board and they do not provide services to the plan other than on behalf of the sponsor.

(III)

Treatment of providers of medical care

In the case of a sponsor which is an association whose membership consists primarily of providers of medical care, subclause (I) shall not apply in the case of any service provider described in subclause (I) who is a provider of medical care under the plan.

(iii)

Certain plans excluded

Clause (i) shall not apply to a small business health plan which is in existence on the date of the enactment of the Health Insurance Marketplace Modernization and Affordability Act of 2005.

(B)

Sole authority

The board has sole authority under the plan to approve applications for participation in the plan and to contract with insurers and service providers.

(c)

Treatment of franchise networks

In the case of a group health plan which is established and maintained by a franchiser for a franchise network consisting of its franchisees—

(1)

the requirements of subsection (a) and section 801(a) shall be deemed met if such requirements would otherwise be met if the franchiser were deemed to be the sponsor referred to in section 801(b), such network were deemed to be an association described in section 801(b), and each franchisee were deemed to be a member (of the association and the sponsor) referred to in section 801(b); and

(2)

the requirements of section 804(a)(1) shall be deemed met.

The Secretary may by regulation define for purposes of this subsection the terms franchiser, franchise network, and franchisee.
804.

Participation and coverage requirements

(a)

Covered employers and individuals

The requirements of this subsection are met with respect to a small business health plan if, under the terms of the plan—

(1)

each participating employer must be—

(A)

a member of the sponsor;

(B)

the sponsor; or

(C)

an affiliated member of the sponsor with respect to which the requirements of subsection (b) are met, except that, in the case of a sponsor which is a professional association or other individual-based association, if at least one of the officers, directors, or employees of an employer, or at least one of the individuals who are partners in an employer and who actively participates in the business, is a member or such an affiliated member of the sponsor, participating employers may also include such employer; and

(2)

all individuals commencing coverage under the plan after certification under this part must be—

(A)

active or retired owners (including self-employed individuals), officers, directors, or employees of, or partners in, participating employers; or

(B)

the beneficiaries of individuals described in subparagraph (A).

(b)

Coverage of previously uninsured employees

In the case of a small business health plan in existence on the date of the enactment of the Health Insurance Marketplace Modernization and Affordability Act of 2005, an affiliated member of the sponsor of the plan may be offered coverage under the plan as a participating employer only if—

(1)

the affiliated member was an affiliated member on the date of certification under this part; or

(2)

during the 12-month period preceding the date of the offering of such coverage, the affiliated member has not maintained or contributed to a group health plan with respect to any of its employees who would otherwise be eligible to participate in such small business health plan.

(c)

Individual market unaffected

The requirements of this subsection are met with respect to a small business health plan if, under the terms of the plan, no participating employer may provide health insurance coverage in the individual market for any employee not covered under the plan which is similar to the coverage contemporaneously provided to employees of the employer under the plan, if such exclusion of the employee from coverage under the plan is based on a health status-related factor with respect to the employee and such employee would, but for such exclusion on such basis, be eligible for coverage under the plan.

(d)

Prohibition of discrimination against employers and employees eligible to participate

The requirements of this subsection are met with respect to a small business health plan if—

(1)

under the terms of the plan, all employers meeting the preceding requirements of this section are eligible to qualify as participating employers for all geographically available coverage options, unless, in the case of any such employer, participation or contribution requirements of the type referred to in section 2711 of the Public Health Service Act are not met;

(2)

upon request, any employer eligible to participate is furnished information regarding all coverage options available under the plan; and

(3)

the applicable requirements of sections 701, 702, and 703 are met with respect to the plan.

805.

Other requirements relating to plan documents, contribution rates, and benefit options

(a)

In general

The requirements of this section are met with respect to a small business health plan if the following requirements are met:

(1)

Contents of governing instruments

(A)

In general

The instruments governing the plan include a written instrument, meeting the requirements of an instrument required under section 402(a)(1), which—

(i)

provides that the board of directors serves as the named fiduciary required for plans under section 402(a)(1) and serves in the capacity of a plan administrator (referred to in section 3(16)(A)); and

(ii)

provides that the sponsor of the plan is to serve as plan sponsor (referred to in section 3(16)(B)).

(B)

Description of material provisions

The terms of the health insurance coverage (including the terms of any individual certificates that may be offered to individuals in connection with such coverage) describe the material benefit and rating, and other provisions set forth in this section and such material provisions are included in the summary plan description.

(2)

Contribution rates must be nondiscriminatory

(A)

In general

The contribution rates for any participating small employer shall not vary on the basis of any health status-related factor in relation to employees of such employer or their beneficiaries and shall not vary on the basis of the type of business or industry in which such employer is engaged.

(B)

Effect of title

Nothing in this title or any other provision of law shall be construed to preclude a health insurance issuer offering health insurance coverage in connection with a small business health plan, and at the request of such small business health plan, from—

(i)

setting contribution rates for the small business health plan based on the claims experience of the plan so long as any variation in such rates complies with the requirements of clause (ii); or

(ii)

varying contribution rates for participating employers in a small business health plan in a State to the extent that such rates could vary using the same methodology employed in such State for regulating premium rates, subject to the terms of part I of subtitle A of title XXIX of the Public Health Service Act (relating to rating requirements), as added by title II of the Health Insurance Marketplace Modernization and Affordability Act of 2005.

(3)

Regulatory requirements

Such other requirements as the applicable authority determines are necessary to carry out the purposes of this part, which shall be prescribed by the applicable authority by regulation.

(b)

Ability of small business health plans to design benefit options

Nothing in this part or any provision of State law (as defined in section 514(c)(1)) shall be construed to preclude a small business health plan or a health insurance issuer offering health insurance coverage in connection with a small business health plan, from exercising its sole discretion in selecting the specific benefits and services consisting of medical care to be included as benefits under such plan or coverage, except that such benefits and services must meet the terms and specifications of part II of subtitle A of title XXIX of the Public Health Service Act (relating to lower cost plans), as added by title II of the Health Insurance Marketplace Modernization and Affordability Act of 2005, provided that, upon issuance by the Secretary of Health and Human Services of the List of Required Benefits as provided for in section 2922(a) of the Public Health Service Act, the required scope and application for each benefit or service listed in the List of Required Benefits shall be—

(1)

if the domicile State mandates such benefit or service, the scope and application required by the domicile State; or

(2)

if the domicile State does not mandate such benefit or service, the scope and application required by the non-domicile State that does require such benefit or service in which the greatest number of the small business health plan’s participating employers are located.

(c)

State licensure and informational filing

(1)

Domicile state

Coverage shall be issued to a small business health plan in the State in which the sponsor's principal place of business is located.

(2)

Non-domicile states

With respect to a State (other than the domicile State) in which participating employers of a small business health plan are located, an insurer issuing coverage to such small business health plan shall not be required to obtain full licensure in such State, except that the insurer shall provide each State insurance commissioner (or applicable State authority) with an informational filing describing policies sold and other relevant information as may be requested by the applicable State authority.

806.

Requirements for application and related requirements

(a)

Filing fee

Under the procedure prescribed pursuant to section 802(a), a small business health plan shall pay to the applicable authority at the time of filing an application for certification under this part a filing fee in the amount of $5,000, which shall be available in the case of the Secretary, to the extent provided in appropriation Acts, for the sole purpose of administering the certification procedures applicable with respect to small business health plans.

(b)

Information to be included in application for certification

An application for certification under this part meets the requirements of this section only if it includes, in a manner and form which shall be prescribed by the applicable authority by regulation, at least the following information:

(1)

Identifying information

The names and addresses of—

(A)

the sponsor; and

(B)

the members of the board of trustees of the plan.

(2)

States in which plan intends to do business

The States in which participants and beneficiaries under the plan are to be located and the number of them expected to be located in each such State.

(3)

Bonding requirements

Evidence provided by the board of trustees that the bonding requirements of section 412 will be met as of the date of the application or (if later) commencement of operations.

(4)

Plan documents

A copy of the documents governing the plan (including any bylaws and trust agreements), the summary plan description, and other material describing the benefits that will be provided to participants and beneficiaries under the plan.

(5)

Agreements with service providers

A copy of any agreements between the plan, health insurance issuer, and contract administrators and other service providers.

(c)

Filing notice of certification with States

A certification granted under this part to a small business health plan shall not be effective unless written notice of such certification is filed with the applicable State authority of each State in which at least 25 percent of the participants and beneficiaries under the plan are located. For purposes of this subsection, an individual shall be considered to be located in the State in which a known address of such individual is located or in which such individual is employed.

(d)

Notice of material changes

In the case of any small business health plan certified under this part, descriptions of material changes in any information which was required to be submitted with the application for the certification under this part shall be filed in such form and manner as shall be prescribed by the applicable authority by regulation. The applicable authority may require by regulation prior notice of material changes with respect to specified matters which might serve as the basis for suspension or revocation of the certification.

807.

Notice requirements for voluntary termination

A small business health plan which is or has been certified under this part may terminate (upon or at any time after cessation of accruals in benefit liabilities) only if the board of trustees, not less than 60 days before the proposed termination date—

(1)

provides to the participants and beneficiaries a written notice of intent to terminate stating that such termination is intended and the proposed termination date;

(2)

develops a plan for winding up the affairs of the plan in connection with such termination in a manner which will result in timely payment of all benefits for which the plan is obligated; and

(3)

submits such plan in writing to the applicable authority.

Actions required under this section shall be taken in such form and manner as may be prescribed by the applicable authority by regulation.
808.

Definitions and rules of construction

(a)

Definitions

For purposes of this part—

(1)

Affiliated member

The term affiliated member means, in connection with a sponsor—

(A)

a person who is otherwise eligible to be a member of the sponsor but who elects an affiliated status with the sponsor,

(B)

in the case of a sponsor with members which consist of associations, a person who is a member of any such association and elects an affiliated status with the sponsor, or

(C)

in the case of a small business health plan in existence on the date of the enactment of the Health Insurance Marketplace Modernization and Affordability Act of 2005, a person eligible to be a member of the sponsor or one of its member associations.

(2)

Applicable authority

The term applicable authority means the Secretary, except that, in connection with any exercise of the Secretary's authority with respect to which the Secretary is required under section 506(d) to consult with a State, such term means the Secretary, in consultation with such State.

(3)

Applicable State authority

The term applicable State authority means, with respect to a health insurance issuer in a State, the State insurance commissioner or official or officials designated by the State to enforce the requirements of title XXVII of the Public Health Service Act for the State involved with respect to such issuer.

(4)

Group health plan

The term group health plan has the meaning provided in section 733(a)(1) (after applying subsection (b) of this section).

(5)

Health insurance coverage

The term health insurance coverage has the meaning provided in section 733(b)(1).

(6)

Health insurance issuer

The term health insurance issuer has the meaning provided in section 733(b)(2).

(7)

Individual market

(A)

In general

The term individual market means the market for health insurance coverage offered to individuals other than in connection with a group health plan.

(B)

Treatment of very small groups

(i)

In general

Subject to clause (ii), such term includes coverage offered in connection with a group health plan that has fewer than 2 participants as current employees or participants described in section 732(d)(3) on the first day of the plan year.

(ii)

State exception

Clause (i) shall not apply in the case of health insurance coverage offered in a State if such State regulates the coverage described in such clause in the same manner and to the same extent as coverage in the small group market (as defined in section 2791(e)(5) of the Public Health Service Act) is regulated by such State.

(8)

Medical care

The term medical care has the meaning provided in section 733(a)(2).

(9)

Participating employer

The term participating employer means, in connection with a small business health plan, any employer, if any individual who is an employee of such employer, a partner in such employer, or a self-employed individual who is such employer (or any dependent, as defined under the terms of the plan, of such individual) is or was covered under such plan in connection with the status of such individual as such an employee, partner, or self-employed individual in relation to the plan.

(10)

Small employer

The term small employer means, in connection with a group health plan with respect to a plan year, a small employer as defined in section 2791(e)(4).

(b)

Rule of construction

For purposes of determining whether a plan, fund, or program is an employee welfare benefit plan which is a small business health plan, and for purposes of applying this title in connection with such plan, fund, or program so determined to be such an employee welfare benefit plan—

(1)

in the case of a partnership, the term employer (as defined in section 3(5)) includes the partnership in relation to the partners, and the term employee (as defined in section 3(6)) includes any partner in relation to the partnership; and

(2)

in the case of a self-employed individual, the term employer (as defined in section 3(5)) and the term employee (as defined in section 3(6)) shall include such individual.

.

(b)

Conforming amendments to preemption rules

(1)

Section 514(b)(6) of such Act (29 U.S.C. 1144(b)(6)) is amended by adding at the end the following new subparagraph:

(E)

The preceding subparagraphs of this paragraph do not apply with respect to any State law in the case of a small business health plan which is certified under part 8.

.

(2)

Section 514 of such Act (29 U.S.C. 1144) is amended—

(A)

in subsection (b)(4), by striking Subsection (a) and inserting Subsections (a) and (d);

(B)

in subsection (b)(5), by striking subsection (a) in subparagraph (A) and inserting subsection (a) of this section and subsections (a)(2)(B) and (b) of section 805, and by striking subsection (a) in subparagraph (B) and inserting subsection (a) of this section or subsection (a)(2)(B) or (b) of section 805;

(C)

by redesignating subsection (d) as subsection (e); and

(D)

by inserting after subsection (c) the following new subsection:

(d)
(1)

Except as provided in subsection (b)(4), the provisions of this title shall supersede any and all State laws insofar as they may now or hereafter preclude a health insurance issuer from offering health insurance coverage in connection with a small business health plan which is certified under part 8.

(2)

In any case in which health insurance coverage of any policy type is offered under a small business health plan certified under part 8 to a participating employer operating in such State, the provisions of this title shall supersede any and all laws of such State insofar as they may establish rating and benefit requirements that would otherwise apply to such coverage, provided the requirements of section 805(a)(2)(B) and (b) (concerning small business health plan rating and benefits) are met.

.

(3)

Section 514(b)(6)(A) of such Act (29 U.S.C. 1144(b)(6)(A)) is amended—

(A)

in clause (i)(II), by striking and at the end;

(B)

in clause (ii), by inserting and which does not provide medical care (within the meaning of section 733(a)(2)), after arrangement,, and by striking title. and inserting title, and; and

(C)

by adding at the end the following new clause:

(iii)

subject to subparagraph (E), in the case of any other employee welfare benefit plan which is a multiple employer welfare arrangement and which provides medical care (within the meaning of section 733(a)(2)), any law of any State which regulates insurance may apply.

.

(4)

Section 514(e) of such Act (as redesignated by paragraph (2)(C)) is amended by striking Nothing and inserting (1) Except as provided in paragraph (2), nothing.

(c)

Plan sponsor

Section 3(16)(B) of such Act (29 U.S.C. 102(16)(B)) is amended by adding at the end the following new sentence: Such term also includes a person serving as the sponsor of a small business health plan under part 8..

(d)

Savings clause

Section 731(c) of such Act is amended by inserting or part 8 after this part.

(e)

Clerical amendment

The table of contents in section 1 of the Employee Retirement Income Security Act of 1974 is amended by inserting after the item relating to section 734 the following new items:

Part 8—Rules governing small business health plans

801. Small business health plans.

802. Certification of small business health plans.

803. Requirements relating to sponsors and boards of trustees.

804. Participation and coverage requirements.

805. Other requirements relating to plan documents, contribution rates, and benefit options.

806. Requirements for application and related requirements.

807. Notice requirements for voluntary termination.

808. Definitions and rules of construction.

.

102.

Cooperation between Federal and State authorities

Section 506 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1136) is amended by adding at the end the following new subsection:

(d)

Consultation with States with respect to small business health plans

(1)

Agreements with States

The Secretary shall consult with the State recognized under paragraph (2) with respect to a small business health plan regarding the exercise of—

(A)

the Secretary’s authority under sections 502 and 504 to enforce the requirements for certification under part 8; and

(B)

the Secretary’s authority to certify small business health plans under part 8 in accordance with regulations of the Secretary applicable to certification under part 8.

(2)

Recognition of domicile State

In carrying out paragraph (1), the Secretary shall ensure that only one State will be recognized, with respect to any particular small business health plan, as the State with which consultation is required. In carrying out this paragraph such State shall be the domicile State, as defined in section 805(c).

.

103.

Effective date and transitional and other rules

(a)

Effective date

The amendments made by this title shall take effect 1 year after the date of the enactment of this Act. The Secretary of Labor shall first issue all regulations necessary to carry out the amendments made by this title within 1 year after the date of the enactment of this Act.

(b)

Treatment of certain existing health benefits programs

(1)

In general

In any case in which, as of the date of the enactment of this Act, an arrangement is maintained in a State for the purpose of providing benefits consisting of medical care for the employees and beneficiaries of its participating employers, at least 200 participating employers make contributions to such arrangement, such arrangement has been in existence for at least 10 years, and such arrangement is licensed under the laws of one or more States to provide such benefits to its participating employers, upon the filing with the applicable authority (as defined in section 808(a)(2) of the Employee Retirement Income Security Act of 1974 (as amended by this subtitle)) by the arrangement of an application for certification of the arrangement under part 8 of subtitle B of title I of such Act—

(A)

such arrangement shall be deemed to be a group health plan for purposes of title I of such Act;

(B)

the requirements of sections 801(a) and 803(a) of the Employee Retirement Income Security Act of 1974 shall be deemed met with respect to such arrangement;

(C)

the requirements of section 803(b) of such Act shall be deemed met, if the arrangement is operated by a board of trustees which—

(i)

is elected by the participating employers, with each employer having one vote; and

(ii)

has complete fiscal control over the arrangement and which is responsible for all operations of the arrangement;

(D)

the requirements of section 804(a) of such Act shall be deemed met with respect to such arrangement; and

(E)

the arrangement may be certified by any applicable authority with respect to its operations in any State only if it operates in such State on the date of certification.

The provisions of this subsection shall cease to apply with respect to any such arrangement at such time after the date of the enactment of this Act as the applicable requirements of this subsection are not met with respect to such arrangement or at such time that the arrangement provides coverage to participants and beneficiaries in any State other than the States in which coverage is provided on such date of enactment.
(2)

Definitions

For purposes of this subsection, the terms group health plan, medical care, and participating employer shall have the meanings provided in section 808 of the Employee Retirement Income Security Act of 1974, except that the reference in paragraph (7) of such section to an small business health plan shall be deemed a reference to an arrangement referred to in this subsection.

II

Near-term market relief

201.

Near-term market relief

The Public Health Service Act (42 U.S.C. 201 et seq.) is amended by adding at the end the following:

XXIX

Health care insurance marketplace reform

2901.

General insurance definitions

In this title, the terms health insurance coverage, health insurance issuer, group health plan, and individual health insurance shall have the meanings given such terms in section 2791.

A

Near-term market relief

I

Rating requirements

2911.

Definitions

In this part:

(1)

Adopting state

The term adopting State means a State that has enacted either the NAIC model rules or the National Interim Model Rating Rules in their entirety and as the exclusive laws of the State that relate to rating in the small group insurance market.

(2)

Commission

The term Commission means the Harmonized Standards Commission established under section 2921.

(3)

Eligible insurer

The term eligible insurer means a health insurance issuer that is licensed in a nonadopting State and that—

(A)

notifies the Secretary, not later than 30 days prior to the offering of coverage described in this subparagraph, that the issuer intends to offer small group health insurance coverage consistent with the National Interim Model Rating Rules in a nonadopting State;

(B)

notifies the insurance department of a nonadopting State (or other State agency), not later than 30 days prior to the offering of coverage described in this subparagraph, that the issuer intends to offer small group health insurance coverage in that State consistent with the National Interim Model Rating Rules, and provides with such notice a copy of any insurance policy that it intends to offer in the State, its most recent annual and quarterly financial reports, and any other information required to be filed with the insurance department of the State (or other State agency) by the Secretary in regulations; and

(C)

includes in the terms of the health insurance coverage offered in nonadopting States (including in the terms of any individual certificates that may be offered to individuals in connection with such group health coverage) and filed with the State pursuant to subparagraph (B), a description in the insurer's contract of the National Interim Model Rating Rules and an affirmation that such Rules are included in the terms of such contract.

(4)

Health insurance coverage

The term health insurance coverage means any coverage issued in small group health insurance market.

(5)

NAIC model rules

The term NAIC model rules means the rating rules provided for in the 1992 Adopted Small Employer Health Insurance Availability Model Act of the National Association of Insurance Commissioners.

(6)

National Interim Model Rating Rules

The term National Interim Model Rating Rules means the rules promulgated under section 2912(a).

(7)

Nonadopting state

The term nonadopting State means a State that is not an adopting State.

(8)

Small group insurance market

The term small group insurance market shall have the meaning given the term small group market in section 2791(e)(5).

(9)

State law

The term State law means all laws, decisions, rules, regulations, or other State actions (including actions by a State agency) having the effect of law, of any State.

2912.

Rating rules

(a)

National interim model rating rules

Not later than 6 months after the date of enactment of this title, the Secretary, in consultation with the National Association of Insurance Commissioners, shall, through expedited rulemaking procedures, promulgate National Interim Model Rating Rules that shall be applicable to the small group insurance market in certain States until such time as the provisions of subtitle B become effective. Such Model Rules shall apply in States as provided for in this section beginning with the first plan year after the such Rules are promulgated.

(b)

Utilization of NAIC model rules

In promulgating the National Interim Model Rating Rules under subsection (a), the Secretary, except as otherwise provided in this subtitle, shall utilize the NAIC model rules regarding premium rating and premium variation.

(c)

Transition in certain States

(1)

In general

In promulgating the National Interim Model Rating Rules under subsection (a), the Secretary shall have discretion to modify the NAIC model rules in accordance with this subsection to the extent necessary to provide for a graduated transition, of not to exceed 3 years following the promulgation of such National Interim Rules, with respect to the application of such Rules to States.

(2)

Initial premium variation

(A)

In general

Under the modified National Interim Model Rating Rules as provided for in paragraph (1), the premium variation provision of subparagraph (C) shall be applicable only with respect to small group policies issued in States which, on the date of enactment of this title, have in place premium rating band requirements that vary by less than 50 percent from the premium variation standards contained in subparagraph (C) with respect to the standards provided for under the NAIC model rules.

(B)

Other States

Health insurance coverage offered in a State that, on the date of enactment of this title, has in place premium rating band requirements that vary by more than 50 percent from the premium variation standards contained in subparagraph (C) shall be subject to such graduated transition schedules as may be provided by the Secretary pursuant to paragraph (1).

(C)

Amount of variation

The amount of a premium rating variation from the base premium rate due to health conditions of covered individuals under this subparagraph shall not exceed a factor of—

(i)

+/- 25 percent upon the issuance of the policy involved; and

(ii)

+/- 15 percent upon the renewal of the policy.

(3)

Other transitional authority

In developing the National Interim Model Rating Rules, the Secretary may also provide for the application of transitional standards in certain States with respect to the following:

(A)

Independent rating classes for old and new business.

(B)

Such additional transition standards as the Secretary may determine necessary for an effective transition.

2913.

Application and preemption

(a)

Superceding of state law

(1)

In general

This part shall supersede any and all State laws insofar as such State laws (whether enacted prior to or after the date of enactment of this subtitle) relate to rating in the small group insurance market as applied to an eligible insurer, or small group health insurance coverage issued by an eligible insurer, in a nonadopting State.

(2)

Nonadopting states

This part shall supersede any and all State laws of a nonadopting State insofar as such State laws (whether enacted prior to or after the date of enactment of this subtitle)—

(A)

prohibit an eligible insurer from offering coverage consistent with the National Interim Model Rating Rules in a nonadopting State; or

(B)

discriminate against or among eligible insurers offering health insurance coverage consistent with the National Interim Model Rating Rules in a nonadopting state.

(b)

Savings clause and construction

(1)

Nonapplication to adopting states

Subsection (a) shall not apply with respect to adopting states.

(2)

Nonapplication to certain insurers

Subsection (a) shall not apply with respect to insurers that do not qualify as eligible insurers that offer small group health insurance coverage in a nonadopting State.

(3)

Nonapplication where obtaining relief under state law

Subsection (a)(1) shall not apply to any State law in a nonadopting State to the extent necessary to permit individuals or the insurance department of the State (or other State agency) to obtain relief under State law to require an eligible insurer to comply with the terms of the small group health insurance coverage issued in the nonadopting State. In no case shall this paragraph, or any other provision of this title, be construed to create a cause of action on behalf of an individual or any other person under State law in connection with a group health plan that is subject to the Employee Retirement Income Security Act of 1974 or health insurance coverage issued in connection with such a plan.

(4)

Nonapplication to enforce requirements relating to the national rule

Subsection (a)(1) shall not apply to any State law in a nonadopting State to the extent necessary to provide the insurance department of the State (or other State agency) with the authority to enforce State law requirements relating to the National Interim Model Rating Rules that are not set forth in the terms of the small group health insurance coverage issued in a nonadopting State, in a manner that is consistent with the National Interim Model Rating Rules and that imposes no greater duties or obligations on health insurance issuers than the National Interim Model Rating Rules.

(5)

Nonapplication to subsection (a)(2)

Paragraphs (3) and (4) shall not apply with respect to subsection (a)(2).

(6)

No affect on preemption

In no case shall this subsection be construed to affect the scope of the preemption provided for under the Employee Retirement Income Security Act of 1974.

(c)

Effective date

This section shall apply beginning in the first plan year following the issuance of the final rules by the Secretary under the National Interim Model Rating Rules.

2914.

Civil actions and jurisdiction

(a)

In general

The district courts of the United States shall have exclusive jurisdiction over civil actions involving the interpretation of this part.

(b)

Actions

A health insurance issuer may bring an action in the district courts of the United States for injunctive or other equitable relief against a nonadopting State in connection with the application of a state law that violates this part.

(c)

Violations of section 2913

In the case of a nonadopting State that is in violation of section 2913(a)(2), a health insurance issuer may bring an action in the district courts of the United States for damages against the nonadopting State and, if the health insurance issuer prevails in such action, the district court shall award the health insurance issuer its reasonable attorneys fees and costs.

2915.

Sunset

The National Interim Model Rating Rules shall remain in effect in a non-adopting State until such time as the harmonized national rating rules are promulgated and effective pursuant to part II. Upon such effective date, such harmonized rules shall supersede the National Rules.

II

Lower cost plans

2921.

Definitions

In this part:

(1)

Adopting state

The term adopting State means a State that has enacted the State Benefit Compendium in its entirety and as the exclusive laws of the State that relate to benefit, service, and provider mandates in the group and individual insurance markets.

(2)

Eligible insurer

The term eligible insurer means a health insurance issuer that is licensed in a nonadopting State and that—

(A)

notifies the Secretary, not later than 30 days prior to the offering of coverage described in this subparagraph, that the issuer intends to offer group health insurance coverage consistent with the State Benefit Compendium in a nonadopting State;

(B)

notifies the insurance department of a nonadopting State (or other State agency), not later than 30 days prior to the offering of coverage described in this subparagraph, that the issuer intends to offer group health insurance coverage in that State consistent with the State Benefit Compendium, and provides with such notice a copy of any insurance policy that it intends to offer in the State, its most recent annual and quarterly financial reports, and any other information required to be filed with the insurance department of the State (or other State agency) by the Secretary in regulations; and

(C)

includes in the terms of the health insurance coverage offered in nonadopting States (including in the terms of any individual certificates that may be offered to individuals in connection with such group health coverage) and filed with the State pursuant to subparagraph (B), a description in the insurer's contract of the State Benefit Compendium and that adherence to the Compendium is included as a term of such contract.

(3)

Health insurance coverage

The term health insurance coverage means any coverage issued in the group or individual health insurance markets.

(4)

Nonadopting state

The term nonadopting State means a State that is not an adopting State.

(5)

State Benefit Compendium

The term State Benefit Compendium means the Compendium issued under section 2922.

(6)

State law

The term State law means all laws, decisions, rules, regulations, or other State actions (including actions by a State agency) having the effect of law, of any State.

2922.

Offering lower cost plans

(a)

List of Required Benefits

Not later than 3 months after the date of enactment of this title, the Secretary shall issue by interim final rule a list (to be known as the List of Required Benefits) of the benefit, service, and provider mandates that are required to be provided by health insurance issuers in at least 45 States as a result of the application of State benefit, service, and provider mandate laws.

(b)

State benefit compendium

(1)

Variance

Not later than 12 months after the date of enactment of this title, the Secretary shall issue by interim final rule a compendium (to be known as the State Benefit Compendium) of harmonized descriptions of the benefit, service, and provider mandates identified under subsection (a). In developing the Compendium, with respect to differences in State mandate laws identified under subsection (a) relating to similar benefits, services, or providers, the Secretary shall review and define the scope and application of such State laws so that a common approach shall be applicable under such Compendium in a uniform manner. In making such determination, the Secretary shall adopt an approach reflective of the approach used by a plurality of the States requiring such benefit, service, or provider mandate.

(2)

Effect

The State Benefit Compendium shall provide that any State benefit, service, and provider mandate law (enacted prior to or after the date of enactment of this title) other than those described in the Compendium shall not be binding on health insurance issuers in an adopting State.

(3)

Implementation

The effective date of the State Benefit Compendium shall be the later of—

(A)

the date that is 12 months from the date of enactment of this title; or

(B)

such subsequent date on which the interim final rule for the State Benefit Compendium shall be issued.

(c)

Non-association coverage

With respect to health insurers selling insurance to small employers (as defined in section 808(a)(10) of the Employee Retirement Income Security Act of 1974), in the event the Secretary fails to issue the State Benefit Compendium within 12 months of the date of enactment of this title, the required scope and application for each benefit or service listed in the List of Required Benefits shall, other than with respect to insurance issued to a Small Business Health Plan, be—

(1)

if the State in which the insurer issues a policy mandates such benefit or service, the scope and application required by such State; or

(2)

if the State in which the insurer issues a policy does not mandate such benefit or service, the scope and application required by such other State that does require such benefit or service in which the greatest number of the insurer’s small employer policyholders are located.

(d)

Updating of State benefit compendium

Not later than 2 years after the date on which the Compendium is issued under subsection (b)(1), and every 2 years thereafter, the Secretary, applying the same methodology provided for in subsections (a) and (b)(1), in consultation with the National Association of Insurance Commissioners, shall update the Compendium. The Secretary shall issue the updated Compendium by regulation, and such updated Compendium shall be effective upon the first plan year following the issuance of such regulation.

2923.

Application and preemption

(a)

Superceding of state law

(1)

In general

This part shall supersede any and all State laws (whether enacted prior to or after the date of enactment of this title) insofar as such laws relate to benefit, service, or provider mandates in the health insurance market as applied to an eligible insurer, or health insurance coverage issued by an eligible insurer, in a nonadopting State.

(2)

Nonadopting states

This part shall supersede any and all State laws of a nonadopting State (whether enacted prior to or after the date of enactment of this title) insofar as such laws—

(A)

prohibit an eligible insurer from offering coverage consistent with the State Benefit Compendium, as provided for in section 2922(a), in a nonadopting State; or

(B)

discriminate against or among eligible insurers offering or seeking to offer health insurance coverage consistent with the State Benefit Compendium in a nonadopting State.

(b)

Savings clause and construction

(1)

Nonapplication to adopting states

Subsection (a) shall not apply with respect to adopting States.

(2)

Nonapplication to certain insurers

Subsection (a) shall not apply with respect to insurers that do not qualify as eligible insurers who offer health insurance coverage in a nonadopting State.

(3)

Nonapplication where obtaining relief under state law

Subsection (a)(1) shall not apply to any State law of a nonadopting State to the extent necessary to permit individuals or the insurance department of the State (or other State agency) to obtain relief under State law to require an eligible insurer to comply with the terms of the group health insurance coverage issued in a nonadopting State. In no case shall this paragraph, or any other provision of this title, be construed to create a cause of action on behalf of an individual or any other person under State law in connection with a group health plan that is subject to the Employee Retirement Income Security Act of 1974 or health insurance coverage issued in connection with such plan.

(4)

Nonapplication to enforce requirements relating to the compendium

Subsection (a)(1) shall not apply to any State law in a nonadopting State to the extent necessary to provide the insurance department of the State (or other state agency) authority to enforce State law requirements relating to the State Benefit Compendium that are not set forth in the terms of the group health insurance coverage issued in a nonadopting State, in a manner that is consistent with the State Benefit Compendium and imposes no greater duties or obligations on health insurance issuers than the State Benefit Compendium.

(5)

Nonapplication to subsection (a)(2)

Paragraphs (3) and (4) shall not apply with respect to subsection (a)(2).

(6)

No affect on preemption

In no case shall this subsection be construed to affect the scope of the preemption provided for under the Employee Retirement Income Security Act of 1974.

(c)

Effective date

This section shall apply upon the first plan year following final issuance by the Secretary of the State Benefit Compendium.

2924.

Civil actions and jurisdiction

(a)

In general

The district courts of the United States shall have exclusive jurisdiction over civil actions involving the interpretation of this part.

(b)

Actions

A health insurance issuer may bring an action in the district courts of the United States for injunctive or other equitable relief against a nonadopting State in connection with the application of a State law that violates this part.

(c)

Violations of section 2923

In the case of a nonadopting State that is in violation of section 2923(a)(2), a health insurance issuer may bring an action in the district courts of the United States for damages against the nonadopting State and, if the health insurance issuer prevails in such action, the district court shall award the health insurance issuer its reasonable attorneys fees and costs.

.

III

Harmonization of health insurance laws

301.

Health Insurance Regulatory Harmonization

Title XXIX of the Public Health Service Act (as added by section 201) is amended by adding at the end the following:

B

Regulatory harmonization

2931.

Definitions

In this subtitle:

(1)

Access

The term access means any requirements of State law that regulate the following elements of access:

(A)

Renewability of coverage.

(B)

Guaranteed issuance as provided for in title XXVII.

(C)

Guaranteed issue for individuals not eligible under subparagraph (B).

(D)

High risk pools.

(E)

Pre-existing conditions limitations.

(2)

Adopting state

The term adopting State means a State that has enacted the harmonized standards adopted under this subtitle in their entirety and as the exclusive laws of the State that relate to the harmonized standards.

(3)

Eligible insurer

The term eligible insurer means a health insurance issuer that is licensed in a nonadopting State and that—

(A)

notifies the Secretary, not later than 30 days prior to the offering of coverage described in this subparagraph, that the issuer intends to offer health insurance coverage consistent with the harmonized standards in a nonadopting State;

(B)

notifies the insurance department of a nonadopting State (or other State agency), not later than 30 days prior to the offering of coverage described in this subparagraph, that the issuer intends to offer group health insurance coverage in that State consistent with the State Benefit Compendium, and provides with such notice a copy of any insurance policy that it intends to offer in the State, its most recent annual and quarterly financial reports, and any other information required to be filed with the insurance department of the State (or other State agency) by the Secretary in regulations; and

(C)

includes in the terms of the health insurance coverage offered in nonadopting States (including in the terms of any individual certificates that may be offered to individuals in connection with such group health coverage) and filed with the State pursuant to subparagraph (B), a description of the harmonized standards published pursuant to section 2932(g)(2) and an affirmation that such standards are a term of the contract.

(4)

Harmonized standards

The term harmonized standards means the standards adopted by the Secretary under section 2932(d).

(5)

Health insurance coverage

The term health insurance coverage means any coverage issued in the health insurance market.

(6)

Nonadopting state

The term nonadopting State means a State that fails to enact, within 2 years of the date in which final regulations are issued by the Secretary adopting the harmonized standards under this subtitle, the harmonized standards in their entirety and as the exclusive laws of the State that relate to the harmonized standards.

(7)

Patient protections

The term patient protections means any requirement of State law that regulate the following elements of patient protections:

(A)

Internal appeals.

(B)

External appeals.

(C)

Direct access to providers.

(D)

Prompt payment of claims.

(E)

Utilization review.

(F)

Marketing standards.

(8)

Plurality requirement

The term plurality requirement means the most common substantially similar requirements for elements within each area described in section 2932(b)(1).

(9)

Rating

The term rating means, at the time of issuance or renewal, requirements of State law the regulate the following elements of rating:

(A)

Limits on the types of variations in rates based on health status.

(B)

Limits on the types of variations in rates based on age and gender.

(C)

Limits on the types of variations in rates based on geography, industry and group size.

(D)

Periods of time during which rates are guaranteed.

(E)

The review and approval of rates.

(F)

The establishment of classes or blocks of business.

(G)

The use of actuarial justifications for rate variations.

(10)

State law

The term State law means all laws, decisions, rules, regulations, or other State actions (including actions by a State agency) having the effect of law, of any State.

(11)

Substantially similar

The term substantially similar means a requirement of State law applicable to an element of an area identified in section 2932 that is similar in most material respects. Where the most common State action with respect to an element is to adopt no requirement for an element of an area identified in such section 2932, the plurality requirement shall be deemed to impose no requirements for such element.

2932.

Harmonized standards

(a)

Commission

(1)

Establishment

The Secretary, in consultation with the NAIC, shall establish the Commission on Health Insurance Standards Harmonization (referred to in this subtitle as the Commission) to develop recommendations that harmonize inconsistent State health insurance laws in accordance with the laws adopted in a plurality of the States.

(2)

Composition

The Commission shall be composed of the following individuals to be appointed by the Secretary:

(A)

Two State insurance commissioners, of which one shall be a Democrat and one shall be a Republican, and of which one shall be designated as the chairperson and one shall be designated as the vice chairperson.

(B)

Two representatives of State government, one of which shall be a governor of a State and one of which shall be a State legislator, and one of which shall be a Democrat and one of which shall be a Republican.

(C)

Two representatives of employers, of which one shall represent small employers and one shall represent large employers.

(D)

Two representatives of health insurers, of which one shall represent insurers that offer coverage in all markets (including individual, small, and large markets), and one shall represent insurers that offer coverage in the small market.

(E)

Two representatives of consumer organizations.

(F)

Two representatives of insurance agents and brokers.

(G)

Two representatives of healthcare providers.

(H)

Two independent representatives of the American Academy of Actuaries who have familiarity with the actuarial methods applicable to health insurance.

(I)

One administrator of a qualified high risk pool.

(3)

Terms

The members of the Commission shall serve for the duration of the Commission. The Secretary shall fill vacancies in the Commission as needed and in a manner consistent with the composition described in paragraph (2).

(b)

Development of harmonized standards

(1)

In general

In accordance with the process described in subsection (c), the Commission shall identify and recommend nationally harmonized standards for the small group health insurance market, the individual health insurance market, and the large group health insurance market that relate to the following areas:

(A)

Rating.

(B)

Access to coverage.

(C)

Patient protections.

(2)

Recommendations

The Commission shall recommend separate harmonized standards with respect to each of the three insurance markets described in paragraph (1) and separate standards for each element of the areas described in subparagraph (A) through (C) of such paragraph within each such market. Notwithstanding the previous sentence, the Commission shall not recommend any harmonized standards that disrupt, expand, or duplicate the benefit, service, or provider mandate standards provided in the State Benefit Compendium pursuant to section 2922(a).

(c)

Process for identifying harmonized standards

(1)

In general

The Commission shall develop recommendations to harmonize inconsistent State insurance laws with the laws adopted in a plurality of the States. In carrying out the previous sentence, the Commission shall review all State laws that regulate insurance in each of the insurance markets and areas described in subsection (b)(1) and identify the plurality requirement within each element of such areas. Such plurality requirement shall be the harmonized standard for such area in each such market.

(2)

Consultation

The Commission shall consult with the National Association of Insurance Commissioners in identifying the plurality requirements for each element within the area and in recommending the harmonized standards.

(3)

Review of federal laws

The Commission shall review whether any Federal law imposes a requirement relating to the markets and areas described in subsection (b)(1). In such case, such Federal requirement shall be deemed the plurality requirement and the Commission shall recommend the Federal requirement as the harmonized standard for such elements.

(d)

Recommendations and adoption by Secretary

(1)

Recommendations

Not later than 1 year after the date of enactment of this title, the Commission shall recommend to the Secretary the adoption of the harmonized standards identified pursuant to subsection (c).

(2)

Regulations

Not later than 120 days after receipt of the Commission's recommendations under paragraph (1), the Secretary shall issue final regulations adopting the recommended harmonized standards. If the Secretary finds the recommended standards for an element of an area to be arbitrary and inconsistent with the plurality requirements of this section, the Secretary may issue a unique harmonized standard only for such element through the application of a process similar to the process set forth in subsection (c) and through the issuance of proposed and final regulations.

(3)

Effective date

The regulations issued by the Secretary under paragraph (2) shall be effective on the date that is 2 years after the date on which such regulations were issued.

(e)

Termination

The Commission shall terminate and be dissolved after making the recommendations to the Secretary pursuant to subsection (d)(1).

(f)

Updated harmonized standards

(1)

In general

Not later than 2 years after the termination of the Commission under subsection (e), and every 2 years thereafter, the Secretary shall update the harmonized standards. Such updated standards shall be adopted in accordance with paragraph (2).

(2)

Updating of standards

(A)

In general

The Secretary shall review all State laws that regulate insurance in each of the markets and elements of areas set forth in subsection (b)(1) and identify whether a plurality of States have adopted substantially similar requirements that differ from the harmonized standards adopted by the Secretary pursuant to subsection (d). In such case, the Secretary shall consider State laws that have been enacted with effective dates that are contingent upon adoption as a harmonized standard by the Secretary. Substantially similar requirements for each element within such area shall be considered to be an updated harmonized standard for such an area.

(B)

Report

The Secretary shall request the National Association of Insurance Commissioners to issue a report to the Secretary every 2 years to assist the Secretary in identifying the updated harmonized standards under this paragraph. Nothing in this subparagraph shall be construed to prohibit the Secretary from issuing updated harmonized standards in the absence of such a report.

(C)

Regulations

The Secretary shall issue regulations adopting updated harmonized standards under this paragraph within 90 days of identifying such standards. Such regulations shall be effective beginning on the date that is 2 years after the date on which such regulations are issued.

(g)

Publication

(1)

Listing

The Secretary shall maintain an up to date listing of all harmonized standards adopted under this section on the Internet website of the Department of Health and Human Services.

(2)

Sample contract language

The Secretary shall publish on the Internet website of the Department of Health and Human Services sample contract language that incorporates the harmonized standards adopted under this section, which may be used by insurers seeking to qualify as an eligible insurer. The types of harmonized standards that shall be included in sample contract language are the standards that are relevant to the contractual bargain between the insurer and insured.

(h)

State adoption and enforcement

Not later than 2 years after the issuance by the Secretary of final regulations adopting harmonized standards under this section, the States may adopt such harmonized standards (and become an adopting State) and, in which case, shall enforce the harmonized standards pursuant to State law.

2933.

Application and preemption

(a)

Superceding of state law

(1)

In general

The harmonized standards adopted under this subtitle shall supersede any and all State laws (whether enacted prior to or after the date of enactment of this title) insofar as such State laws relate to the areas of harmonized standards as applied to an eligible insurer, or health insurance coverage issued by a eligible insurer, in a nonadopting State.

(2)

Nonadopting states

This subtitle shall supersede any and all State laws of a nonadopting State (whether enacted prior to or after the date of enactment of this title) insofar as they may—

(A)

prohibit an eligible insurer from offering coverage consistent with the harmonized standards in the nonadopting State; or

(B)

discriminate against or among eligible insurers offering or seeking to offer health insurance coverage consistent with the harmonized standards in the nonadopting State.

(b)

Savings clause and construction

(1)

Nonapplication to adopting states

Subsection (a) shall not apply with respect to adopting States.

(2)

Nonapplication to certain insurers

Subsection (a) shall not apply with respect to insurers that do not qualify as eligible insurers who offer health insurance coverage in a nonadopting State.

(3)

Nonapplication where obtaining relief under state law

Subsection (a)(1) shall not apply to any State law of a nonadopting State to the extent necessary to permit individuals or the insurance department of the State (or other State agency) to obtain relief under State law to require an eligible insurer to comply with the terms of the health insurance coverage issued in a nonadopting State. In no case shall this paragraph, or any other provision of this subtitle, be construed to permit a cause of action on behalf of an individual or any other person under State law in connection with a group health plan that is subject to the Employee Retirement Income Security Act of 1974 or health insurance coverage issued in connection with such plan.

(4)

Nonapplication to enforce requirements relating to the compendium

Subsection (a)(1) shall not apply to any State law in a nonadopting State to the extent necessary to provide the insurance department of the State (or other state agency) authority to enforce State law requirements relating to the harmonized standards that are not set forth in the terms of the health insurance coverage issued in a nonadopting State, in a manner that is consistent with the harmonized standards and imposes no greater duties or obligations on health insurance issuers than the harmonized standards.

(5)

Nonapplication to subsection (a)(2)

Paragraphs (3) and (4) shall not apply with respect to subsection (a)(2).

(6)

No affect on preemption

In no case shall this subsection be construed to affect the scope of the preemption provided for under the Employee Retirement Income Security Act of 1974.

(c)

Effective date

This section shall apply beginning on the date that is 2 years after the date on which final regulations are issued by the Secretary under this subtitle adopting the harmonized standards.

2934.

Civil actions and jurisdiction

(a)

In general

The district courts of the United States shall have exclusive jurisdiction over civil actions involving the interpretation of this subtitle.

(b)

Actions

A health insurance issuer may bring an action in the district courts of the United States for injunctive or other equitable relief against a nonadopting State in connection with the application of a State law that violates this subtitle.

(c)

Violations of section 2933

In the case of a nonadopting State that is in violation of section 2933(a)(2), a health insurance issuer may bring an action in the district courts of the United States for damages against the nonadopting State and, if the health insurance issuer prevails in such action, the district court shall award the health insurance issuer its reasonable attorneys fees and costs.

2935.

Authorization of appropriations

There are authorized to be appropriated such sums as may be necessary to carry out this subtitle.

.