Full Text
The Legislation
Read the proposed text of the Secure Affordable Federal Essential Care Act Plus.
___TH CONGRESS
1ST SESSION
H.R. ____
To establish a national health coverage and payment system known as the SAFECARE System, to provide universal essential health coverage for all eligible residents of the United States, to reform health workforce education financing, to reduce administrative waste and medical debt, to reform medical malpractice, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
Mr. ________ introduced the following bill.
A BILL
Be it enacted by the Senate and House of Representatives of the United States of America in
Congress assembled,
SEC. 3.CONGRESSIONAL FINDINGS AND PURPOSE.
(a)Findings. Congress finds the following.
(1)In 2025, United States health care spending exceeded 5.5 trillion dollars. This was
approximately 16,100 dollars per person and 18.2 percent of gross domestic product. (Centers for
Medicare and Medicaid Services and Congressional Budget Office projections)
(2)Federal subsidies and spending for major health programs and health insurance, including
Medicare, Medicaid, the Children's Health Insurance Program, and marketplace subsidies, are
projected to total approximately 26 trillion dollars over the 2026 to 2035 period under current
law. (Congressional Budget Office)
(3)The Congressional Budget Office and related analyses project that spending on Social
Security and major health care programs will grow from about 10.9 percent of gross domestic
product in 2025 to about 14.3 percent by 2055 if current law continues.
(4)Despite high spending, health outcomes in the United States often lag behind other high
income countries. Comparative analyses attribute a large portion of the difference to higher
prices, administrative costs, and fragmented financing rather than to higher use of services.
(5)Recent estimates suggest that total waste in the health care system, including administrative
complexity, pricing failures, overtreatment, and fraud, amounts to between 760 billion and 935
billion dollars per year.
(6)Administrative complexity alone accounts for hundreds of billions of dollars in annual
spending, including roughly 200 billion dollars a year on financial transaction related
administration and at least half a trillion dollars in broader administrative waste and overhead
that does not improve health outcomes.
(7)Medical debt is widespread. A 2022 KFF survey found that about 41 percent of adults had
debt due to medical or dental bills. More recent work estimates that 11 to 18 percent of adults
currently carry medical debt and that the total burden is on the order of 200 to 220 billion dollars.
(8)Analyses of credit records and survey data show that medical debt is a major contributor to
housing instability, delayed care, and financial distress, including among insured households.
(9)Nearly one third of national health expenditures are for hospital care alone, which totaled
about 1.5 trillion dollars in 2023. Rising hospital prices and complex cost shifting add to
household and employer burdens.
(10)Per capita health care expenditures are projected to grow from approximately 16,900 dollars
in 2026 to over 25,000 dollars by 2035 if current trends continue. This implies an average annual
per capita growth rate of approximately 4.5 percent, which continues to outpace median wage
growth and threatens fiscal sustainability.
(11)Medical education debt is a significant barrier to balanced workforce supply. Recent data
show that typical medical school graduates carry debts around 200,000 dollars or more, which
pushes them toward higher paying specialties and away from primary care and underserved
areas.
(12)Persons who are physically present in the United States, regardless of status, can spread
contagious disease if they do not receive basic emergency and public health services. Failure to
provide such care endangers citizens and lawful residents and increases long term costs.
(13)Current systems for detecting and punishing fraud in health care are fragmented. Each payer
sees only a partial picture. This allows bad actors to move from program to program and to
exploit gaps in oversight.
(14)A single national essential benefits system delivered through certified plans, with a unified risk pool and claims platform, can
reduce waste, simplify administration, improve bargaining power, and stabilize coverage across
life events, while still allowing room for private supplemental options.
(15)Malpractice coverage and defensive medicine together represent a measurable share of
United States health care spending. Major reviews estimate that the combined costs of
malpractice premiums, litigation, and defensive medicine practices may account for between 2
and 3 percent of total health spending. This is roughly 100 billion to 150 billion dollars per year.
These costs fall unevenly on high risk specialties and do not always track clear gains in patient
safety.
(16)In many other developed systems, national malpractice rules combine three elements. Full
compensation of documented economic losses. Predictable limits on extreme noneconomic
awards. And strong incentives for providers to follow evidence based clinical guidelines.
(17)Predictable national malpractice rules that preserve full compensation for economic harm,
limit extreme noneconomic awards, and create safe harbors for adherence to evidence based
clinical standards issued by a transparent national board, can reduce defensive medicine and
premium spikes while preserving meaningful remedies for patients who experience preventable
harm.
(18)Administrative burden and documentation overhead reduce effective clinical capacity. The deployment of ambient clinical documentation support under section 404A is expected to recover substantial physician and clinical staff time nationwide, improving access and continuity of care without reducing clinical quality. Nothing in this paragraph shall be construed to establish a statutory entitlement to a specific quantified number of hours recovered.
(b)Purpose. The purpose of this Act is to
(1)establish a SAFECARE System that provides a universal floor of essential health coverage for
every legal resident, independent of employment or marital status,
(2)replace most existing basic health insurance arrangements with a single national essential benefits system delivered through certified plans, including the Federal Standard Plan, for
essential care, financed through employer and employee payroll contributions and other
dedicated receipts, with declining reliance on transfers from general Federal revenues during
transition as provided in section 207,
(3)protect households from financial ruin due to illness through strict annual caps on out of
pocket costs and a program to redeem and cancel legacy medical debt,
(4)reform health workforce education costs through tuition caps, scholarships tied to service,
and structured loan forgiveness,
(5)consolidate data and enforcement authority to detect, prevent, and punish fraud and abuse,
(6)maintain a limited safety net for emergency and public health services for non members, for
the protection of the public,
(7)reform medical malpractice liability to stabilize provider costs, discourage defensive
medicine, and preserve patient access to fair compensation for real harm,
(8)reduce prescription drug and biologic prices through a national formulary and
most-favored-nation pricing linked to prices in comparable developed nations, and
(9)manage the transition from current arrangements to the SAFECARE System through a staged
schedule that preserves continuity of care.
SEC. 4.DEFINITIONS.
(1)Secretary. The term Secretary means the Secretary of Health and Human Services.
(2)System. The term SAFECARE System or System means the national health coverage and payment system established under title I, including certified plans, the Federal Standard Plan, the SAFECARE Trust Fund, the Universal Rate Schedule, and the National Health Claims Data Platform.
(3)Certified plan. The term certified plan means a health benefit plan or private health insurer product that is certified under section 105 to provide the essential benefit floor described in section 104.
(4)Federal Standard Plan. The term Federal Standard Plan (also known as the “Shield Plan” or “SHIELD”) means the certified plan offered and administered directly by the Secretary under title I. In public communications and outreach materials, the Federal Standard Plan may be referred to as the “Shield Plan” (Standard Health Insurance for Essential Living and Dignity).
(5)Legal resident. The term legal resident means a citizen of the United States, a lawful permanent resident, or an alien lawfully present in the United States, as defined by the Secretary in regulations that are consistent with Federal immigration law.
(6)Member. The term member means any legal resident enrolled in a certified plan under title III.
(7)Essential health services. The term essential health services means medically necessary services that are included in the national benefit floor described in section 104.
(8)Provider. The term provider means any individual or entity that furnishes health services, including hospitals, clinics, physicians, nurse practitioners, physician assistants, mental and behavioral health professionals, dentists, optometrists, pharmacists, and allied health professionals.
(9)Non member. The term non member means a person physically present in the United States who is not a legal resident and is not enrolled as a member, except as provided in the Bridge option under section 603.
(10)Trust Fund. The term SAFECARE Trust Fund or Trust Fund means the fund established under section 201.
(11)Income. The term income means adjusted gross income, as defined in the Internal Revenue Code of 1986, with such modifications as the Secretary of the Treasury may prescribe for purposes of this Act.
(12)Payroll. The term payroll means wages, salaries, and other compensation that are subject to payroll tax under the Internal Revenue Code of 1986, including net earnings from self employment.
(13)Universal Rate Schedule. The term Universal Rate Schedule means the nationally applicable all payer payment rates and methodologies established under section 402 for essential health services furnished to members.
(14)National Health Claims Data Platform. The term National Health Claims Data Platform or Platform means the mandatory clearinghouse and data platform established under section 801 for eligibility, claims, payments, and integrity functions for certified plans and participating providers.
(15)United States. The term United States includes the 50 States, the District of Columbia, the Commonwealth of Puerto Rico, the United States Virgin Islands, Guam, American Samoa, and the Commonwealth of the Northern Mariana Islands.
(16)Frontier area. The term frontier area means an area designated by the Secretary by regulation using objective access criteria, including low population density, limited road connectivity, extended travel time to acute care, and seasonal or weather related access constraints.
(17)Frontier State. The term Frontier State means a State designated by the Secretary by regulation in which a substantial share of residents reside in frontier areas. Alaska is deemed a Frontier State.
(18)Aeromedical transport. The term aeromedical transport means medically necessary patient transport by fixed wing aircraft or helicopter, including clinically necessary staffing and equipment.
(19)Medevac. The term medevac means aeromedical transport initiated due to absence of timely clinically appropriate ground transport or absence of clinically appropriate local capability.
TITLE I. ESTABLISHMENT OF THE SAFECARE SYSTEM.
TITLE I—ESTABLISHMENT OF THE SAFECARE SYSTEM.
SEC. 101.ESTABLISHMENT.
(a)Program. There is established within the Department of Health and Human Services a program to be known as the SAFECARE System.
(b)Function. The System shall:
(1)provide coverage for essential health services for all members through certified plans, including the Federal Standard Plan;
(2)operate a Federal Health Insurance Marketplace that supports plan choice within the certified plan framework;
(3)ensure that essential health services furnished to members are paid under the Universal Rate Schedule on an all payer basis;
(4)operate the National Health Claims Data Platform as the single national clearinghouse for eligibility, claims processing, payment routing, and integrity controls; and
(5)coordinate with existing Federal, State, and private systems during the transition period set forth in title X.
(c)Rule of construction. Nothing in this Act shall be construed to require an employer to sponsor or offer a health plan. Employer obligations under this Act are satisfied through contributions under title II, and employer participation in enrollment processes shall be limited to payroll withholding, information reporting, and facilitation of member plan selection as specified by the Secretary.
SEC. 102.ADMINISTRATION.
(a)Lead agency. The Secretary shall administer the System through the Centers for Medicare and
Medicaid Services or a successor agency designated by the Secretary.
(b)Advisory bodies. The Secretary may establish advisory councils on benefits, workforce,
payment policy, fraud control, medical liability, and other domains. These councils shall include
representatives of patients, providers, employers, and States.
SEC. 103.UNIVERSAL ENTITLEMENT.
(a)Entitlement. Every legal resident of the United States is entitled to enrollment in a certified plan and to coverage for essential health services, subject to the provisions of this Act.
(b)Choice. The Secretary shall ensure an annual open enrollment period during which a member may select among available certified plans, including the Federal Standard Plan, under rules that prevent risk selection and preserve continuous coverage.
(c)Nondiscrimination. Coverage and payment shall not vary because of health status, age, sex, race, income, employment, marital status, or prior use of services, except as permitted for income based cost sharing under section 204 and for risk adjustment under section 207A.
SEC. 104.ESSENTIAL HEALTH SERVICES.
(a)Benefit floor. The System shall cover, at a minimum, the following essential health services.
(1)Primary and preventive care, including routine office visits, screenings, and vaccinations.
(2)Specialty care and consultations.
(3)Emergency and trauma care.
(3A)Emergency medical transportation. Emergency medical transportation,
including ground ambulance services and medically necessary aeromedical
transport and medevac, when a participating provider determines that such
transport is clinically necessary or local capability is not available in a
timely manner.
(4)Inpatient and outpatient hospital services.
(5)Maternity, perinatal, and newborn care.
(6)Pediatric services, including basic dental and vision.
(7)Mental health and substance use disorder services, including outpatient and inpatient
treatment and medications.
(8)Rehabilitative and habilitative services and devices, including physical, occupational, and
speech therapy.
(9)Chronic disease management.
(10)Medically necessary diagnostic imaging and laboratory services.
(11)Medically necessary prescription drugs and biologics, subject to a national formulary and
the pricing requirements in section 405.
(12)Adult dental services and vision services, including routine preventive care and medically
necessary restorative or corrective services, under standards set by the Secretary.
(13)Long-Term Services and Supports.
(A)Protection of primary residence for middle and low income families.
Notwithstanding any other provision of law, including section 1917 of the Social Security Act (42 U.S.C. 1396p) and any State estate recovery program requirements previously applied under Medicaid, the Secretary shall ensure that no lien, claim, or recovery is imposed against a protected primary residence solely by reason of System payment for long term services and supports under this paragraph, except as provided in subparagraph (F).
(B)Definitions.
For purposes of this paragraph:
(i)Primary residence. The term ‘primary residence’ means a dwelling that was the member’s principal place of residence for at least 12 months during the 24 month period preceding the first day on which custodial nursing facility care under this paragraph is furnished, including a manufactured home used as a principal residence.
(ii)Protected primary residence. The term ‘protected primary residence’ means a primary residence with protected equity not exceeding the applicable cap under subparagraph (C), and that is not excluded under subparagraph (E).
(iii)Qualified heir. The term ‘qualified heir’ means a child, stepchild, adopted child, or grandchild of the member. The Secretary may permit designation of an additional natural person as an heir under standards established by the Secretary. No designation may include a corporation, partnership, limited liability company, trust, or other arrangement used primarily to avoid recovery.
(C)Protected equity cap, locality based.
(i)In general. The protected equity cap shall be equal to 175 percent of the most recently available county median owner occupied home value for the county in which the primary residence is located, as published by the Census Bureau or another authoritative Federal source designated by the Secretary.
(iv)Percentile guardrail. The Secretary may define the protected equity cap as the lesser of 175 percent of county median owner occupied home value, and the 80th percentile owner occupied home value for the county, if such percentile data are available from an authoritative Federal source.
(ii)Updates. The Secretary shall update the cap not less frequently than every 3 years.
(iii)Reasonable floor and ceiling. To avoid extreme distortions, the Secretary may apply a national floor and national ceiling, provided that the floor and ceiling are set to preserve protection for typical homes and to prevent sheltering of high value residences. The floor and ceiling shall be indexed not less frequently than every 3 years.
(D)Inheritance protection.
If a protected primary residence exists, the Secretary shall not require sale of the home, shall not delay transfer, and shall not impose any repayment condition as a prerequisite to eligibility, enrollment, or receipt of benefits under this paragraph. A qualified heir may inherit and retain the protected primary residence without repayment to the System.
(E)Exclusions.
A residence is not a protected primary residence if:
(i)the residence is not the member’s primary residence, including a second home or vacation property,
(ii)the residence is held primarily for investment or rental income,
(iii)the residence is subject to arrangements designed primarily to avoid recovery,
(iv)the protected equity cap is exceeded, except as provided in subparagraph (F).
(F)Limited recovery above the cap.
For a primary residence with equity exceeding the protected equity cap under subparagraph (C), recovery shall be limited to the amount by which equity exceeds the cap, and only after the death of the member and the death of any surviving spouse.
(G)Anti sheltering and lookback alignment.
The Secretary shall apply transfer and lookback rules consistent with safeguards previously applied under Medicaid long term care.
(H)Hardship protection.
The Secretary shall administer a hardship waiver process that prevents displacement of qualified heirs of limited means.
(I)Covered long-term care services.
Medically necessary long-term care, including home- and community-based services and custodial nursing facility care, subject to clinical eligibility criteria established by the Secretary, including functional limitations and medical necessity standards, without regard to the member's income or assets, and subject to income-based cost sharing under section 204(g).
(J)Geographic cost-of-living adjustment for LTSS cost sharing.
(i)Authority. The Secretary, in consultation with the Secretary of Housing and Urban Development, may establish a Geographic LTSS Cost-of-Living Index based on HUD Area Median Income data at the county or metropolitan statistical area level, updated not less frequently than every 3 years.
(ii)Threshold adjustment. Where the applicable county or MSA Area Median Income exceeds the national median Area Median Income by more than 25 percent, the Secretary may adjust the income thresholds in section 204(g)(3)(A) and (B) upward by a percentage not to exceed the percentage by which local Area Median Income exceeds the national median Area Median Income, rounded to the nearest 10 percentage points of the applicable Federal poverty level. No adjustment under this clause shall increase the applicable threshold by more than 100 percentage points of the applicable Federal poverty level above the unadjusted threshold in section 204(g)(3). Before any adjustment under this clause takes effect, the Secretary shall publish in the Federal Register, not less than 90 days in advance—
(I)the proposed adjusted threshold for each affected county or MSA;
(II)the Chief Actuary's estimate of the number of LTSS-using members in each affected county or MSA who would be affected by the threshold change;
(III)the Chief Actuary's estimated annual change in copayment receipts credited to the LTSS Sub-Account under section 201(d) resulting from the adjustment; and
(IV)a certification by the Chief Actuary that the adjustment, net of estimated revenue change, does not project to accelerate the corrective action trigger under section 201A(c) within the 5-year projection window.
(iii)Nursing facility cap adjustment. For members receiving custodial nursing facility care under subparagraph (I), the annual copayment cap under section 204(g)(2) shall be the lesser of $3,000 or 2 percent of the CMS-published median annual nursing facility cost for the county or metropolitan statistical area in which the facility is located, as updated not less frequently than every 3 years by the Secretary based on Medicare Cost Report data. This clause shall not apply to members receiving home- and community-based services only.
(iv)HCBS protection. No adjustment under clause (ii) or (iii) shall increase the copayment burden on members receiving home- and community-based services only. Members receiving HCBS retain full use of their income for housing, food, and other concurrent living expenses, and the Secretary shall administer adjustments under this subparagraph in a manner that reflects the distinction between institutional care, in which facility costs replace housing costs, and home-based care, in which they do not.
(v)No downward adjustment. Nothing in this subparagraph shall be construed to authorize the Secretary to reduce the income thresholds in section 204(g)(3) below the unadjusted 400 percent Federal poverty level threshold for any county or MSA.
(vi)Data sources. The Secretary shall use HUD Area Median Income data and CMS Medicare Cost Report data as the primary sources for adjustments under this subparagraph. The Secretary shall publish all adjustment factors in the Federal Register not less than 90 days before they take effect.
(K)Member income contribution for institutional long-term care.
(i)In general. For members receiving custodial nursing facility care under subparagraph (I), the Secretary shall establish by regulation a Member Income Contribution requirement under which a portion of the member's countable monthly income, as defined in clause (iii), shall be applied toward the cost of covered nursing facility services before LTSS Sub-Account payment under section 201(d) is made.
(ii)Contribution amount. The Member Income Contribution for each calendar month shall equal the member's countable monthly income minus the personal needs allowance established under clause (iv), but shall not exceed the monthly cost of covered nursing facility services payable under the Universal Rate Schedule for that member. For a member subject to the enhanced Member Income Contribution under section 104(a)(13)(L)(iv)(B)(iii), the multiplier applicable under that clause shall be applied to the standard contribution amount calculated under this clause before crediting to the LTSS Sub-Account. The multiplier shall not affect the personal needs allowance under clause (iv), the community spouse allowance under clause (iii)(II), or any dependent maintenance deduction under clause (iii).
(iii)Countable monthly income defined. For purposes of this subparagraph, the term "countable monthly income" means the member's gross monthly income from all sources, including Social Security benefits under title II of the Social Security Act, Supplemental Security Income payments under title XVI of the Social Security Act, pension and annuity payments, and any other recurring income, reduced by
(I)the personal needs allowance under clause (iv);
(II)any amount required to be paid for the health or maintenance of a community spouse, as defined by the Secretary by regulation, which amount shall not be less than the Minimum Monthly Maintenance Needs Allowance applicable under section 1924(d)(3) of the Social Security Act (42 U.S.C. 1396r-5(d)(3)), as adjusted annually by the Secretary for inflation using the CPI-W, and shall not exceed 150 percent of that amount unless the Secretary determines a higher amount is necessary to prevent spousal impoverishment, and any amount required for maintenance of a dependent family member under standards established by the Secretary; and
(III)any incurred medical expenses not covered under this Act, as prescribed by the Secretary.
(iv)Personal needs allowance. The Secretary shall establish a personal needs allowance of not less than $200 per member per month. The personal needs allowance shall be retained entirely by the member, shall not be subject to the Member Income Contribution under this subparagraph, and shall not be applied toward any facility cost. The personal needs allowance shall be indexed annually to the CPI-W under a methodology specified by the Secretary.
(v)HCBS exception. The Member Income Contribution under this subparagraph shall not apply to members receiving home- and community-based services only. A member receiving HCBS retains full use of all income for housing, food, utilities, and other living expenses concurrent with HCBS receipt.
(vi)Mixed-setting rule. For members receiving both HCBS and nursing facility care within the same calendar month, the Member Income Contribution shall apply only on a pro rata basis for the days of nursing facility care, as determined by the Secretary.
(vii)No prior payment condition. Eligibility for and receipt of nursing facility care under subparagraph (I) shall not be conditioned on prior payment of the Member Income Contribution. Unpaid contributions shall be recoverable through procedures established by the Secretary, consistent with the inheritance protections under subparagraphs (A) through (H). No lien or recovery may be imposed against a protected primary residence solely by reason of unpaid Member Income Contributions, except as provided in subparagraph (F).
(viii)Crediting. All amounts collected as Member Income Contributions under this subparagraph shall be credited exclusively to the LTSS Sub-Account under section 201(d) and shall be treated as dedicated receipts for purposes of section 207(b)(1). Such amounts shall not be treated as general Trust Fund receipts for purposes of section 206 reserve ratio calculations.
(ix)SSI coordination. The Secretary, in coordination with the Commissioner of Social Security, shall establish procedures to ensure that the Member Income Contribution under this subparagraph does not duplicate cost-sharing obligations imposed under the personal needs allowance rules applicable to institutionalized individuals under title XVI of the Social Security Act. No amount within the personal needs allowance under clause (iv) shall be subject to collection under this subparagraph. The Secretary and the Commissioner shall establish a unified payment coordination mechanism so that SSI payments directed toward facility costs under Federal SSI rules are credited against the Member Income Contribution required under this subparagraph, with no double-collection.
(x)Hardship waiver. The Secretary shall administer a hardship waiver process under which the Member Income Contribution may be reduced or suspended for a member facing exceptional financial hardship, including where full contribution would deprive the member of funds necessary for the health and maintenance of a community spouse or dependent, under standards consistent with those previously applicable under the Medicaid program.
(xi)Termination upon Title XIV activation. Upon activation of title XIV under section 1401, the Member Income Contribution under this subparagraph shall be superseded by the contribution and benefit structure under title XIV as specified in the activating Act of Congress. No member shall be subject to both the Member Income Contribution under this subparagraph and the contribution under section 1404 in a manner that results in double-collection for the same period.
(L)Vesting and graduated institutional LTSS coverage.
(i)In general. Home and community-based services under subparagraph (I) remain available based solely on clinical eligibility and are not subject to vesting. Custodial nursing facility care under subparagraph (I) is subject to the vesting and graduated coverage rules in this subparagraph.
(ii)Vesting credits. For purposes of this subparagraph, a member earns 1 LTSS vesting credit for each calendar quarter in which the member has reportable contributions under section 202 or section 203, as determined by the Secretary of the Treasury. The Secretary shall also provide LTSS vesting credits, under standards established by regulation, for calendar quarters in which a member is unable to work due to disability, and for calendar quarters in which a member is a primary caregiver providing uncompensated care to a dependent child or a dependent adult with a serious functional limitation. The Secretary may cap caregiver credits at not less than 8 quarters per member. Any quarter of coverage credited to a member under title II of the Social Security Act shall be treated as an LTSS vesting credit for purposes of this subparagraph. A member with not less than 40 quarters of coverage under title II of the Social Security Act, including any equivalent quarters recognized for the member under applicable totalization agreements for purposes of eligibility for benefits under such title, shall be deemed fully vested under clause (iii).
(iii)Fully vested status. A member is fully vested for custodial nursing facility care upon attaining not less than 40 LTSS vesting credits.
(iv)Graduated coverage prior to full vesting.
(A)Standard graduated coverage. For a member who is clinically eligible for custodial nursing facility care but not fully vested under clause (iii), and to whom neither clause (B) nor clause (C) applies as a controlling rule, the System shall cover custodial nursing facility care subject to the following maximum covered duration in any rolling 12-month period:
(I)fewer than 8 vesting credits: up to 90 days
(II)at least 8 but fewer than 20 vesting credits: up to 180 days
(III)at least 20 but fewer than 40 vesting credits: up to 365 days
For purposes of this clause, days of custodial nursing facility care shall be counted on a per-day basis.
(B)Long-term resident exception.
(i)In general. Notwithstanding the coverage duration limits in clause (A), a member who satisfies both of the conditions in clause (ii) shall not be subject to the day limits in clause (A). Such a member shall instead be covered for custodial nursing facility care to the same extent as a fully vested member, subject to an enhanced Member Income Contribution under subparagraph (K), calculated in accordance with clause (iii) of this subparagraph.
(ii)Qualifying conditions. The conditions for the exception under this clause are:
(I)Residency duration. The member has maintained legal resident status continuously for not less than 10 years immediately prior to the date on which the member first satisfies clinical eligibility criteria for custodial nursing facility care under subparagraph (I). Periods of lawful authorized presence immediately preceding the grant of legal permanent resident status shall count toward the 10-year period under standards established by the Secretary. Absence from the United States not exceeding 6 months in any 12-month period shall not interrupt continuous residency for purposes of this clause; and
(II)Documented basis for credit deficit. The member's deficit of LTSS vesting credits below the 40-credit threshold is attributable primarily to one or more of the following, as documented under standards established by the Secretary: qualifying disability under clause (ii) of this subparagraph; qualifying caregiving under clause (ii) of this subparagraph; or both.
(iii)Enhanced Member Income Contribution rate. For a member qualifying under this clause, the Member Income Contribution under subparagraph (K)(ii) shall be calculated as follows:
(I)fewer than 8 vesting credits — standard contribution multiplied by 1.50
(II)at least 8 but fewer than 20 vesting credits — standard contribution multiplied by 1.25
(III)at least 20 but fewer than 40 vesting credits — standard contribution multiplied by 1.10
In no case shall the enhanced Member Income Contribution exceed the monthly cost of covered nursing facility services payable under the Universal Rate Schedule for that member. The personal needs allowance under subparagraph (K)(iv), the community spouse allowance under subparagraph (K)(iii)(II), and dependent maintenance amounts under subparagraph (K)(iii) shall be deducted before application of any multiplier under this clause.
(iv)Documentation and verification. The Secretary shall establish by regulation the process by which members may document qualifying disability or caregiving for purposes of this clause, including cross-agency data sharing with the Social Security Administration, the Department of Homeland Security, and State agencies. The Secretary shall establish anti-gaming standards that prevent after-the-fact credentialing of caregiving or disability claims for the purpose of qualifying for this exception.
(v)No entitlement to exception pending documentation. A member who may be eligible for the long-term resident exception but has not yet completed documentation shall receive coverage under clause (A) pending resolution of the documentation. Upon approval of the exception, the Secretary shall treat previously denied days of medically necessary nursing facility care during the documentation period as covered, subject to available facility placement and clinical continuity, under standards established by the Secretary.
(C)Recent arrival rule.
(i)In general. A member who obtained legal resident status within 5 years immediately prior to the date on which the member first satisfies clinical eligibility criteria for custodial nursing facility care under subparagraph (I) is not eligible for the long-term resident exception under clause (B), regardless of total years of legal presence or residency, and shall be subject to the standard graduated coverage limits under clause (A).
(ii)Exceptions to recent arrival rule. Clause (i) shall not apply to:
(I)a member who is a United States citizen on the date of first clinical eligibility;
(II)a member who has attained 40 LTSS vesting credits, including credits earned under a totalization agreement, and is therefore fully vested under clause (iii) regardless of residency duration; or
(III)a member who was admitted as a refugee under section 207 of the Immigration and Nationality Act, as an asylee under section 208 of such Act, or under a comparable humanitarian admission category, and who has maintained legal resident status continuously since such admission, provided that the member satisfies the documented disability or caregiving condition under clause (B)(ii)(II).
(iii)Secretary's authority to extend. The Secretary may extend the recent arrival period under clause (i) to not more than 10 years by regulation, upon a written finding, published in the Federal Register, that the 5-year period creates material and documented fiscal risk to the LTSS Sub-Account based on the Chief Actuary's projection under section 201A(b). Any such extension shall apply prospectively only and shall not affect members who obtained legal resident status before the effective date of the extended perio Any extension of the recent arrival period under this clause shall automatically extend the sponsor bond and insurance obligation period under section 104(a)(13)(M)(iii)(II) to match the extended window, and the Secretary shall notify affected qualifying sponsors not less than 180 days before any such extension takes effect.
(iv)No punitive application. The recent arrival rule shall be applied to determine benefit structure only and shall not be used to deny clinical eligibility, enrollment, or access to home- and community-based services under subparagraph (I), which remain subject to clinical criteria only and are not subject to vesting or residency duration requirements. Nothing in this clause shall be construed to deny, delay, or condition access to essential health services under section 104(a)(1) through (a)(12) or to alter eligibility for long-term services and supports other than the custodial nursing facility coverage duration limits under this subparagrap The sponsor liability mechanism under subparagraph (M) operates separately from and does not modify the benefit structure applicable to the member under this clause. Nothing in subparagraph (M) alters the protections established by this clause for the sponsored member, and no obligation imposed on a qualifying sponsor under subparagraph (M) shall affect the member's access to essential health services under this Act.
(v)Stabilization floor and no interruption rule. Coverage under clause (iv) shall be administered to prevent unsafe discharge. The Secretary shall establish transition rules to avoid interruption of clinically necessary care, including step-down requirements, discharge planning, and rapid HCBS substitution when appropriate.
(vi)Interaction with Member Income Contribution and LTSS cost sharing. Nothing in this subparagraph limits the Member Income Contribution under subparagraph (K) or LTSS cost sharing under section 204(g), which apply according to their terms during periods of covered custodial nursing facility care.
(vii)No prior payment condition. Eligibility for and receipt of covered custodial nursing facility care under this subparagraph shall not be conditioned on prior payment of any amount.
(viii)Rulemaking and reporting. The Secretary shall implement this subparagraph by regulation, including definitions of disability and caregiver credits, anti-gaming standards, and verification mechanisms. The annual actuarial review under section 201A(b) shall include projected effects of this subparagraph on custodial nursing facility utilization and LTSS Sub-Account outlays. The annual actuarial review under section 201A(b) shall additionally include projected utilization of the long-term resident exception under clause (B) and the recent arrival rule under clause (C), including the estimated number of members in each category, estimated nursing facility days covered under each rule, and the estimated enhanced Member Income Contribution receipts attributed to the multiplier under clause (B)(iii), disaggregated from standard Member Income Contribution receipts.
(M)Sponsor liability for long-term services and supports during recent arrival window.
(i)Purpose. This subparagraph establishes a sponsor liability mechanism to ensure that the costs of custodial nursing facility care furnished to a member subject to the recent arrival rule under subparagraph (L)(iv)(C) are recoverable from the member's qualifying immigration sponsor, and that sponsors satisfy a bond or private insurance obligation at the time of System enrollment, consistent with the principle that immigration sponsorship under Federal law entails ongoing financial responsibility for sponsored relatives and that a qualifying sponsor has already been certified by the Department of Homeland Security as having sufficient financial means to support the sponsored member.
(ii)Scope and applicability.
(I)This subparagraph applies to any member who is subject to the recent arrival rule under subparagraph (L)(iv)(C)(i), and whose legal resident status was obtained as a family-sponsored immigrant under section 203(a) of the Immigration and Nationality Act (8 U.S.C. 1153(a)), or as an immediate relative of a United States citizen under section 201(b)(2)(A)(i) of such Act (8 U.S.C. 1151(b)(2)(A)(i)), for whom a qualifying sponsor exists as defined in clause (II).
(II)A qualifying sponsor is a person who executed a valid and enforceable Affidavit of Support under 8 U.S.C. 1183a for the member, or who is otherwise legally obligated under Federal immigration law for the member's financial maintenance. A qualifying sponsor does not include the United States Government, a State government, or a governmental agency.
(III)This subparagraph does not apply to members admitted as refugees under section 207 of the Immigration and Nationality Act (8 U.S.C. 1157), asylees under section 208 of such Act (8 U.S.C. 1158), or under a comparable humanitarian admission category, consistent with the exception under subparagraph (L)(iv)(C)(ii)(III). No bond obligation or sponsor recovery shall be imposed under this subparagraph for such members.
(IV)This subparagraph does not apply to members who are United States citizens or who are fully vested under subparagraph (L)(iii) at the time of System enrollment.
(iii)Sponsor obligation — bond or private insurance requirement.
(I)In general. Before or at the time a sponsored member first enrolls in the System, the qualifying sponsor shall satisfy one of the following obligations:
(aa)LTSS surety bond. The qualifying sponsor shall obtain and maintain a recoverable LTSS surety bond, issued by a surety licensed to do business in the United States under standards established by the Secretary in coordination with the Secretary of the Treasury, in an amount equal to 12 months of the median annual custodial nursing facility cost for the county or metropolitan statistical area of the sponsored member's residence at the time of enrollment, as published by the Secretary using Medicare Cost Report data and updated not less frequently than every 3 years. The bond shall name the Secretary as obligee and shall provide for payment to the Secretary upon a finding of covered LTSS expenditure under clause (iv)(II). The sponsor shall pay the surety premium at the sponsor's expense, subject to clause (v). The face value of the bond shall be adjusted at each 3-year update, and the sponsor shall be required to maintain the bond at the updated face value for the duration of the obligation period under subclause (II).
(bb)Qualifying private long-term care insurance policy. The qualifying sponsor shall obtain and maintain, at the sponsor's expense, a private long-term care insurance policy for the sponsored member that meets minimum standards established by the Secretary by regulation, including: coverage for custodial nursing facility care for not less than 12 months per benefit period; benefits payable to or on behalf of the member during the recent arrival window; a benefit amount not less than the median monthly custodial nursing facility cost for the county or metropolitan statistical area of the member's residence, as determined under the same data source used in item (aa); and no exclusion for pre-existing conditions that would nullify coverage for the member's qualifying LTSS need. The Secretary shall publish a list of qualifying policy standards not later than 12 months before System enrollment opens. If the Secretary determines that a qualifying policy meeting such standards is not reasonably available to sponsors at commercially reasonable terms for a class of sponsored members, the Secretary shall require use of the surety bond option under item (aa) for such class.
(II)Duration. The bond or insurance obligation under this clause shall run from the date of the sponsored member's System enrollment through the expiration of the applicable recent arrival window under subparagraph (L)(iv)(C)(i), which shall not exceed 10 years from the date the member obtained legal resident status.
(III)Release. The bond shall be released and returned to the qualifying sponsor without penalty, and the insurance obligation shall terminate, upon the earliest of: the sponsored member attaining fully vested status under subparagraph (L)(iii); the sponsored member's death; expiration of the recent arrival window without a covered LTSS claim against the bond or insurance; or the sponsored member becoming a United States citizen.
(IV)Enrollment hold. If a qualifying sponsor fails to satisfy the bond or insurance obligation under this clause within 90 days of the sponsored member's initial System enrollment, the Secretary shall place a notation in the member's System record and shall initiate recovery procedures under clause (iv)(II) upon any covered LTSS expenditure. The notation shall not delay, deny, condition, or otherwise affect the sponsored member's enrollment status or access to any benefit under this Act, consistent with clause (viii). Failure to satisfy the obligation under this clause shall not be construed as an eligibility or enrollment condition, and any amounts recoverable under clause (iv)(II) shall constitute a debt owed to the United States by the qualifying sponsor.
(iv)System payment and sponsor recovery.
(I)Failure of a qualifying sponsor to satisfy the bond or insurance obligation under clause (iii) shall not delay or deny coverage of medically necessary custodial nursing facility care to the sponsored member under subparagraph (L). The System shall pay for covered care in the first instance regardless of sponsor compliance status.
(II)Where the System has paid for custodial nursing facility care for a sponsored member subject to this subparagraph, the Secretary shall have a right of recovery against the qualifying sponsor for the lesser of: the total System LTSS expenditure for the member for the applicable period, reduced by the Member Income Contribution collected from the member under subparagraph (K) for the same period; or the face value of the bond that should have been posted under clause (iii)(I)(aa) for that period.
(III)Where the sponsor has posted a surety bond under clause (iii)(I)(aa), recovery shall proceed against the surety under the bond terms before any direct action against the sponsor. Where the surety satisfies the bond obligation, the surety shall be subrogated to the Secretary's recovery rights against the sponsor to the extent of the surety's payment.
(IV)Where the sponsor has obtained a qualifying private LTC insurance policy under clause (iii)(I)(bb), the Secretary shall coordinate with the insurer to ensure that benefits payable under the policy are applied toward covered LTSS costs before the LTSS Sub-Account under section 201(d) is drawn upon. Insurance benefits applied toward LTSS costs shall reduce the System's LTSS Sub-Account outlay for that member on a dollar-for-dollar basis.
(V)Recovery under this clause shall be consistent with the enforcement mechanisms applicable to Affidavit of Support obligations under 8 U.S.C. 1183a(b) and (e), and may be pursued by the Secretary through civil action in Federal district court.
(VI)All amounts recovered under this clause shall be credited exclusively to the LTSS Sub-Account under section 201(d) and treated as dedicated receipts for purposes of section 207(b)(1), and shall be disaggregated from Member Income Contribution receipts in the annual actuarial review under section 201A(b).
(v)Sponsor financial verification and surety premium assistance.
(I)No waiver of bond obligation. The Secretary shall not waive the bond or insurance obligation under clause (iii) on the basis of sponsor income or assets. A qualifying sponsor who petitioned for a family-sponsored immigrant has been certified by the Department of Homeland Security as having income sufficient to satisfy the Affidavit of Support obligation under 8 U.S.C. 1183a. That prior Federal determination is the relevant financial threshold for purposes of this subparagraph, and no separate income threshold shall serve as a basis for waiver.
(II)Surety premium assistance. For a qualifying sponsor whose household income at the time of the sponsored member's System enrollment, as verified by the Secretary of the Treasury against IRS records, does not exceed 200 percent of the Federal poverty level, the Secretary may provide, from amounts appropriated for this purpose, a subsidy toward the annual surety premium payable under clause (iii)(I)(aa), not to exceed 75 percent of the actuarially fair annual premium for the applicable bond face value. Such assistance shall reduce the sponsor's out-of-pocket surety premium cost only and shall not reduce the face value of the bond, alter the bond terms, or limit the Secretary's recovery right under clause (iv)(II).
(III)Fraud referral. Where a qualifying sponsor claims inability to satisfy the bond or insurance obligation under clause (iii), and the Secretary finds that the sponsor's current income or assets are materially inconsistent with the income representations made in the Affidavit of Support filed with the Department of Homeland Security, the Secretary shall refer the matter to the Department of Homeland Security and the Department of Justice for review under 18 U.S.C. 1001 and applicable immigration fraud statutes. The Secretary shall notify the sponsor in writing of any referral under this clause.
(IV)Post-admission income decline — deferred premium only. A qualifying sponsor who demonstrates, through tax records verified by the Secretary of the Treasury, that household income has declined to below 125 percent of the Federal poverty level after the date of the sponsored member's admission, for reasons documented as beyond the sponsor's control and not involving asset transfer or concealment, may apply for a deferred payment schedule for the surety premium obligation only, under standards established by the Secretary by regulation. The bond face value, bond terms, and the Secretary's recovery right under clause (iv)(II) shall not be altered by any deferred payment schedule. The Secretary shall verify continued eligibility for deferred premium payment annually through IRS income verification. A sponsor whose income recovers above 200 percent of the Federal poverty level shall resume full premium payments prospectively within 90 days.
(vi)Interaction with existing Affidavit of Support obligations. Nothing in this subparagraph shall be construed to supersede or diminish the obligations of a qualifying sponsor under 8 U.S.C. 1183a. LTSS costs recovered under clause (iv) shall be credited against any overlapping Affidavit of Support liability of the same sponsor for the same period, so that no double-recovery is imposed on the same sponsor for the same member and the same period of care. The Secretary shall coordinate with the Attorney General to ensure unified administration of sponsor liability under this subparagraph and under 8 U.S.C. 1183a.
(vii)Anti-evasion.
(I)The Secretary, in coordination with the Secretary of Homeland Security and the Attorney General, shall establish standards to prevent evasion of the bond and recovery obligations under this subparagraph.
(II)The Secretary may by regulation treat any transfer of assets by a qualifying sponsor within 5 years before or after the sponsored member's System enrollment that materially impairs the recovery right under clause (iv)(II) as voidable, under standards consistent with the Federal Debt Collection Procedures Act (28 U.S.C. 3301 et seq.) and applicable fraudulent transfer principles.
(III)The Secretary shall establish standards for identifying sham hardship claims, fictitious sponsor-member relationship severances, and other arrangements designed primarily to avoid the bond or recovery obligations under this subparagraph.
(IV)A qualifying sponsor who is found to have engaged in evasion under this clause shall be ineligible for surety premium assistance under clause (v)(II) and shall be subject to civil monetary penalties established by the Secretary, in addition to any criminal referral under clause (v)(III).
(viii)No punitive application to member. Nothing in this subparagraph shall be applied to deny, delay, condition, or reduce the covered benefits of the sponsored member. All bond obligations, insurance obligations, and recovery rights under this subparagraph run exclusively against the qualifying sponsor. A member's access to covered care, enrollment rights, clinical eligibility, and benefit structure shall not be affected by a qualifying sponsor's failure to satisfy any obligation under this subparagraph. This clause controls over all other provisions of this subparagraph in the event of conflict.
(ix)Rulemaking. The Secretary shall issue regulations implementing this subparagraph not later than 18 months after the effective date of this section, in coordination with the Secretary of Homeland Security, the Secretary of the Treasury, and the Commissioner of Social Security.
(14)Organ and tissue donation and transplantation.
(A)Presumed authorization with opt out.
(i)Default rule. Except as provided in clause (ii), each member is presumed to authorize postmortem organ and tissue donation for transplantation and related clinical use under the System.
(ii)Opt out. A member may record an objection at any time through the National Donor Preference Registry under subparagraph (D). A recorded objection shall be honored and shall bar recovery of organs and tissues, except as otherwise required by law for forensic purposes.
(iii)Recorded authorization. A member may record an affirmative authorization at any time through the National Donor Preference Registry under subparagraph (D). A recorded affirmative authorization shall be honored.
(iv)Priority of recorded preference. A recorded objection or recorded affirmative authorization shall control and shall not be overridden by any contrary preference of a third party, except as otherwise required by a court order of competent jurisdiction.
(v)Scope. The Secretary shall define by regulation the clinical uses covered under this paragraph, including transplantation and clinically related uses, and shall exclude nonconsensual research uses.
(vi)Judicial fallback—automatic conversion to affirmative opt in.
(I)Trigger. If a court of competent jurisdiction issues a final, non appealable judgment holding clause (i) of this subparagraph unconstitutional on its face or as applied to members generally, then, without further action by Congress or the Secretary beyond publication of the triggering judgment in the Federal Register, clause (i) shall be suspended as of the date 90 days after the Secretary publishes notice of such judgment, and the following provisions shall apply in lieu of clause (i):
(II)Affirmative opt in default. Upon suspension of clause (i), no member shall be presumed to have authorized postmortem organ or tissue donation. Authorization shall exist only upon a member’s affirmative recorded authorization in the National Donor Preference Registry under subparagraph (D). The Secretary shall treat all members with no recorded preference as having neither authorized nor objected to donation, and shall implement family consultation protocols under subparagraph (D)(iv) for such members.
(III)Enrollment touchpoint authorization. Upon suspension of clause (i), the Secretary shall require that every System enrollment, re enrollment, and annual coverage selection process present each member with a plain language authorization election for the National Donor Preference Registry. The Secretary shall establish standards to ensure the election is clear, prominent, and not buried within general enrollment materials.
(IV)Continuation of incentive architecture. Suspension of clause (i) shall not affect the operative force of subparagraphs (D), (E), (F), (G), (H), (I), (J), or (K) of this paragraph, or of section 204(f). The donor reciprocity priority tiers, Qualified Critical Biologics Supply Partner credits, and all related incentive mechanisms shall continue in full force under the affirmative opt in framework.
(V)Authorization rate accountability. Not later than 5 years after the suspension date under subclause (I), the Secretary shall submit a report to Congress identifying the national affirmative authorization rate achieved under the opt in framework, benchmarked against rates in comparable opt in systems, and shall include any legislative recommendations the Secretary determines appropriate to increase donation rates.
(VI)Severability of this clause. If clause (i) is partially invalidated but upheld as applied to a class of members, the Secretary shall implement the fallback under subclause (II) only with respect to the class for which clause (i) is invalidated, and clause (i) shall remain operative for all other members.
(B)Clinical separation firewall.
(i)Independence requirement. The medical team responsible for the care of a potential donor and the declaration of death shall be strictly independent from any team or personnel involved in organ recovery, allocation, procurement coordination, transport, or transplantation.
(ii)Prohibition. No member of a procurement or transplant team may participate in the treatment decisions for the potential donor, the withdrawal of life sustaining treatment, or the formal determination or declaration of death.
(iii)Allegiance rule. The treating clinician’s primary duty remains exclusively to the donor patient until death is declared in accordance with subparagraph (C).
(iv)Attestation and audit trail. Each participating facility that recovers organs or tissues shall maintain written role separation policies, staffing logs, and contemporaneous attestations sufficient to demonstrate compliance. Such records shall be subject to audit by the Secretary and the Inspector General.
(C)Determination of death and the dead donor rule.
(i)Dead donor rule. Recovery of vital organs shall occur only after a formal declaration of death.
(ii)Standard. Death shall be declared in accordance with applicable law consistent with the Uniform Determination of Death Act, requiring either irreversible cessation of circulatory and respiratory functions or irreversible cessation of all functions of the entire brain.
(iii)No alteration of State death law. Nothing in this paragraph shall be construed to alter State law governing the determination of death. This Act establishes program requirements for System participation and payment.
(D)National Donor Preference Registry.
(i)Establishment. The Secretary shall maintain a single, real-time National Donor Preference Registry for members.
(ii)Interoperability. The Registry shall be interoperable with State donor registries and State motor vehicle agency donor systems through standardized secure data exchange, including reconciliation of preferences and conflict resolution rules established by the Secretary.
(iii)Member access. A member may record or withdraw an objection or affirmative authorization through a simple digital process, including via the System Digital Wallet, and through in-person registration at points of care.
(iv)Family consultation when no recorded preference exists. If no preference is recorded in the Registry, the Secretary shall establish protocols for timely family notification and consultation. Procurement may proceed under the default rule in subparagraph (A)(i), except that a family member may prevent recovery only by providing credible evidence, as defined by the Secretary, that the member held a contrary intent. The facility shall document the basis for any such prevention.
(v)Privacy and confidentiality. Registry data shall be treated as protected health information and may be disclosed only as necessary for clinical determination, procurement coordination, payment integrity, oversight, or as required by law. The Secretary shall implement strong identity verification and fraud controls to prevent unauthorized preference changes.
(E)Procurement and logistics modernization.
(i)Unified operational standards. The Secretary shall establish uniform national standards for donor referral, clinical evaluation, recovery coordination, allocation coordination, chain of custody, packaging, labeling, temperature control, and transport.
(ii)Federal contractor model. To carry out procurement coordination and logistics under this paragraph, the Secretary shall contract with qualified entities as federal contractors, including entities that currently perform procurement functions, subject to competitive selection, performance standards, and enforcement remedies.
(iii)Performance accountability. Contracts under clause (ii) shall include measurable performance requirements, including timely referral response, authorization processing times, recovery coordination quality, and organ utilization outcomes, adjusted for clinical risk. The Secretary may impose corrective action plans, payment withholds, or contract termination for nonperformance.
(iv)Transport and tracking. The Secretary shall establish a national organ transport and tracking capability that provides real-time visibility, chain of custody records, and time stamped event tracking. The Secretary shall prioritize transport practices that reduce loss from logistical failure, including standardized high priority carriage arrangements where feasible.
(v)Transition. The Secretary shall implement the modernization under this subparagraph through a phased transition designed to avoid disruption of recoveries and transplants.
(F)Facility payment for transplant coordination.
(i)Add on payment. Participating hospitals shall be eligible for a Transplant Coordination Add On payment of up to 150 percent of the applicable Medicare rate for covered recovery coordination and transplant logistics services, as specified by the Secretary.
(ii)Conditions. Payment under this subparagraph shall be contingent on documented compliance with subparagraphs (B) and (C), timely donor referral, accurate documentation, and verified coordination steps established by regulation.
(iii)No individual bonuses tied to procurement. The Secretary shall prohibit incentive payments under this subparagraph from being structured as individual clinician bonuses tied to recovery volume.
(G)Oversight and enforcement.
(i)Audits and investigations. The Secretary and the Inspector General may conduct audits and investigations of compliance with this paragraph, including role separation, documentation, registry integrity, and contractor performance.
(ii)Remedies. The Secretary may impose civil monetary penalties, payment withholds, corrective action plans, contract remedies, or participation sanctions for material violations.
(iii)Public reporting. The Secretary shall publish periodic performance summaries on procurement and logistics outcomes, in a form that protects patient privacy.
(H)Rule of construction. Nothing in this paragraph shall be construed to diminish palliative care, comfort care, or the duty to provide medically appropriate treatment to a patient before death is declared. Nothing in this paragraph shall be construed to require any clinician to act contrary to subparagraph (B) or the dead donor rule in subparagraph (C). Nothing in this paragraph shall be construed to require any allocation practice inconsistent with Federal organ allocation law or the governing organ procurement and transplant network contracts; the Secretary shall implement donor reciprocity within those constraints.
(I)Donor reciprocity priority and authorization tiers.
(i)In general. In allocating organs for transplantation under the System, the Secretary shall, consistent with applicable allocation policies and ethical allocation principles, apply a limited donor reciprocity priority for eligible candidates described in clause (ii). This priority shall operate only as a tie breaker or a points adjustment among medically comparable candidates and shall not override medical urgency, compatibility, pediatric priority rules, or other clinical allocation requirements.
(ii)Eligible candidates. An eligible candidate is a member who is at or above the age of majority applicable in the individual’s State of residence and who meets the authorization tier requirements in clauses (viii) through (x).
(iii)Continuous opt in and anti gaming period. To qualify for donor reciprocity priority, the candidate must have maintained the applicable tier status described in clauses (viii) through (x) continuously for not less than 24 months before the date of initial listing for transplantation. Any recorded objection shall reset the 24 month period. Any change that increases authorization level shall start a new 24 month period for the incremental points associated with the increased level.
(iv)Limited waiver for unforeseeable acute failure. The Secretary may waive the 24 month requirement only in cases of sudden acute organ failure that was not reasonably foreseeable, as defined by regulation. A waiver under this clause may be granted only if the candidate records an affirmative authorization not later than 30 days after the qualifying diagnosis. The Secretary shall define categories of conditions that are chronic or progressive and commonly associated with eventual transplant listing. Such conditions shall not qualify for a waiver under this clause.
(v)Protection for minors and incapacity. No candidate under the age of majority shall be denied coverage, deprioritized, or otherwise penalized based on the Registry status of the candidate or any parent, guardian, or third party. The Secretary shall establish rules to ensure that persons who lack capacity to record a Registry preference are treated as neutral for purposes of this subparagraph and are not penalized.
(vi)Non discrimination and medical ineligibility. The Secretary shall implement this subparagraph in a manner that does not discriminate on the basis of disability or medical condition. A candidate shall not be denied donor reciprocity priority solely because the candidate is medically ineligible to donate organs, if the candidate has recorded an affirmative authorization in the Registry. The Secretary may establish neutral alternative criteria for such candidates that reflect intent to participate in donation to the maximum medically appropriate extent.
(vii)Neutral administration. The Secretary shall implement this subparagraph without using race, ethnicity, or religion as allocation criteria.
(viii)Authorization tiers. The National Donor Preference Registry shall support three tiers of donor status for purposes of reciprocity priority.
(A)Tier 1, full authorization. The member records an affirmative authorization for donation of any organs and tissues that are medically suitable at the time of death, including solid organs, subject only to safety and clinical exclusions established by the Secretary.
(B)Tier 2, limited authorization. The member records an affirmative authorization but excludes one or more categories of donation in the Registry, as defined by the Secretary.
(C)Tier 3, objection. The member records an objection in the Registry.
(ix)Tiered weighting. The Secretary shall apply donor reciprocity priority in a tiered manner, providing the highest points adjustment for Tier 1 full authorization and a reduced points adjustment for Tier 2 limited authorization. Tier 3 objection shall receive no reciprocity priority. The Secretary shall ensure the points adjustments remain within the limits of clause (i).
(x)Optional solid organ inclusion boost. Within Tier 1 full authorization, the Secretary may provide an additional modest increase in the points adjustment for members whose full authorization includes solid organ donation, provided that the combined adjustment remains a tie breaker or points adjustment among medically comparable candidates and does not override medical urgency, compatibility, pediatric priority rules, or other clinical allocation requirements.
(J)Hard to match adjustment.
(i)In general. The Secretary shall apply an additional limited allocation adjustment for candidates who are objectively hard to match, to reduce inequitable delays caused by biological scarcity.
(ii)Hard to match criteria. The Secretary shall define hard to match status using objective clinical measures, which may include calculated panel reactive antibody or equivalent sensitization measures, rare antigen or haplotype frequency, blood type constraints, and other medically grounded indicators of low match probability.
(iii)Interaction with reciprocity. The adjustment under this subparagraph may increase the donor reciprocity priority under subparagraph (I) for candidates who meet the criteria in clause (ii), provided that the combined priority remains a tie breaker or points adjustment among medically comparable candidates and does not override medical urgency, compatibility, pediatric priority rules, or other clinical allocation requirements.
(iv)Neutral administration. The Secretary shall implement this subparagraph without using race, ethnicity, or religion as allocation criteria.
(K)Donor to donor conditional donation election.
(i)In general. A member who has recorded a Tier 1 or Tier 2 affirmative authorization in the National Donor Preference Registry under subparagraph (D) may elect, at the time of recording or at any subsequent Registry update, to restrict allocation of the member’s organs and tissues to recipients who have recorded an affirmative authorization under subparagraph (A)(iii), or who satisfy the medically ineligible equivalent standard under subparagraph (I)(vi). Such an election shall be known as a Donor to Donor Conditional Election.
(ii)Registry recording and disclosure. A Donor to Donor Conditional Election shall be recorded in the National Donor Preference Registry and communicated to procurement coordinators and allocation networks through the standardized data exchange established under subparagraph (D)(ii). The Secretary shall establish a clear, plain language disclosure of the practical effect of this election, including the mandatory fallback provision under clause (iv), which must be presented to the member before the election is recorded.
(iii)Anti gaming period. A Donor to Donor Conditional Election shall not take effect for allocation purposes until the member has maintained a Tier 1 or Tier 2 affirmative authorization continuously for not less than 24 months preceding the relevant procurement event. The anti gaming provisions of subparagraph (I)(iii) shall apply to this election, and any change that reduces authorization level shall reset the 24 month period.
(iv)Mandatory fallback to general allocation. If, at the time organs or tissues are available for recovery under this paragraph, no medically suitable recipient who satisfies clause (i) of this subparagraph is identifiable within the standard allocation time window established by the Secretary by regulation, the Donor to Donor Conditional Election shall be deemed withdrawn and allocation shall proceed under standard allocation rules applicable to members generally. The Secretary shall establish the standard allocation time window by regulation at a duration no shorter than the minimum clinically safe window for organ viability for each organ type. No organ or tissue shall be withheld from transplantation, discarded, or removed from allocation solely because no eligible registered donor recipient is available within the time window.
(v)Preservation of overriding priorities. A Donor to Donor Conditional Election shall not override medical urgency classifications, pediatric priority rules, compatibility requirements, or any other clinical allocation requirement that would otherwise take precedence under applicable Federal law and governing organ procurement and transplant network policies. This clause controls over clause (i) of this subparagraph in all cases of conflict.
(vi)Protection for medically ineligible candidates. A candidate who is medically ineligible to donate organs but who has recorded an affirmative authorization in the Registry consistent with subparagraph (I)(vi) shall be treated as satisfying the registered donor requirement under clause (i) of this subparagraph. A Donor to Donor Conditional Election shall not be applied in a manner that discriminates against candidates on the basis of disability or medical ineligibility to donate.
(vii)Neutral administration. The Secretary shall implement this subparagraph without using race, ethnicity, or religion as criteria.
(viii)Rule of construction. Nothing in this subparagraph shall be construed to provide payment or other valuable consideration for the transfer of a human organ for transplantation within the meaning of the National Organ Transplant Act (42 U.S.C. 274e). This subparagraph establishes a donor autonomy preference restriction, not a contractual exchange. Nothing in this subparagraph shall be construed to require any allocation practice inconsistent with Federal organ allocation law or governing organ procurement and transplant network contracts.
(15)Medically tailored nutrition.
(A)Coverage mandate. The System shall cover medically tailored meals and medically necessary nutrition support for members with eligible conditions, when ordered by a participating provider in accordance with clinical standards issued by the Secretary.
(B)Definitions. For purposes of this paragraph.
(i)Medically tailored meals. The term ‘medically tailored meals’ means fully prepared meals designed by or under the supervision of a registered dietitian nutritionist, consistent with clinical standards issued by the Secretary, that are intended to treat or mitigate a diagnosed health condition and reduce avoidable utilization.
(ii)Nutrition prescription. The term ‘nutrition prescription’ means a documented order by a participating provider for medically tailored meals or standardized clinical food packages for an eligible condition, including duration, renewal criteria, and any clinically required constraints.
(C)Eligible conditions. Initial eligibility is limited to members with one or more of the following conditions.
(i)Type 2 diabetes with HbA1c greater than 8.0, or such other threshold as the Secretary may establish by regulation based on evidence.
(ii)Congestive heart failure.
(iii)End stage renal disease prior to transplant.
(iv)Such additional conditions as the Secretary may designate by regulation upon a determination that medically tailored nutrition is expected to improve outcomes and be cost neutral or cost saving.
(D)Duration and renewal. The Secretary shall establish time limited authorizations and objective renewal criteria.
(i)Initial authorization. An initial authorization shall not exceed 12 weeks.
(ii)Renewal. Authorization may be renewed in subsequent 12 week increments upon recertification under standards established by the Secretary.
(E)Food as medicine voucher. Upon a nutrition prescription, the Secretary shall provide electronic benefit vouchers through the System Digital Wallet for the purchase or delivery of approved clinical food packages from approved vendors.
(F)Vendor standards and program integrity. The Secretary shall establish vendor certification, audit, and fraud controls, including nutrition labeling standards, delivery reliability standards, limits on substitution, and recoupment authority for improper claims. The Secretary may require periodic outcomes reporting in a form that protects privacy.
(G)Clinical benefit characterization.
(i)Medical benefit. Benefits under this paragraph are a covered medical service delivered through prescribed clinical nutrition therapy. Eligibility, duration, and renewal are based on clinical criteria and medical necessity.
(ii)Not general food assistance. Nothing in this paragraph shall be construed to create a general nutritional assistance program, cash benefit, or household subsidy. Vouchers are nontransferable, noncash, and limited to approved clinical food packages.
(H)Waste prevention and utilization controls.
(i)No cash equivalence. Vouchers issued under subparagraph (E) shall not be redeemable for cash and shall be usable only for approved clinical food packages from approved vendors.
(ii)Quantity and cadence limits. The Secretary shall establish quantity limits, refill cadence limits, and order windows designed to prevent stockpiling and spoilage while ensuring continuous access during an authorized period.
(iii)Confirmed delivery and spoilage reduction. Approved vendors shall use delivery confirmation and, where required, temperature appropriate transport. The Secretary may require split deliveries or smaller shipment frequency to reduce spoilage.
(iv)Anti diversion controls. The Secretary shall implement controls to detect and prevent diversion, including identity verification at redemption, anomaly detection, and vendor reporting.
(v)Medically appropriate substitutions. Substitutions shall be limited to nutritionally equivalent items consistent with the prescription and clinical standards.
(vi)Waste reporting and continuous improvement. The Secretary shall collect vendor level data on undelivered orders, returns, and reported spoilage, and shall use such data to refine vendor certification and delivery standards.
(vii)Hardship and access protections. The Secretary shall establish exceptions and alternative fulfillment methods for members with unstable housing, limited refrigeration, disability barriers, or other access constraints, including shelf stable clinical packages, flexible pickup, or community delivery sites.
(I)Program integrity and penalties.
(i)Prohibited acts. A member may not knowingly and willfully.
(A)transfer, sell, barter, or otherwise divert a voucher or voucher funded food package to another person.
(B)redeem a voucher through deception or circumvention for nonapproved items or outside approved vendors.
(C)submit false information to obtain, extend, or renew eligibility under this paragraph.
(ii)Penalties for member abuse. If the Secretary determines, after notice and opportunity to respond, that a member committed a prohibited act under clause (i), the Secretary may impose one or more of the following remedies, graduated by severity and repetition.
(A)Suspension. Suspension of voucher issuance for a period of 3 months to 24 months.
(B)Repayment. Repayment of the value of improperly obtained benefits, subject to ability to pay protections established by the Secretary.
(C)Civil monetary penalty. A civil monetary penalty proportionate to the improper benefit and sufficient for deterrence, for repeated or egregious violations.
(D)Disqualification. Disqualification from this paragraph for up to 5 years for intentional resale, organized diversion, or repeated fraud.
(iii)Safe harbor for nonfraud circumstances. The Secretary shall establish standards to distinguish fraud from nonfraud circumstances including delivery failure, vendor error, cognitive impairment, language barriers, unstable housing, or other barriers. In nonfraud circumstances, the Secretary shall prioritize corrective action, vendor remediation, and alternative delivery options.
(iv)Vendor enforcement. If the Secretary determines that an approved vendor knowingly enabled diversion, submitted false claims, delivered nonconforming products, or engaged in systematic abuse, the Secretary may impose recoupment, civil monetary penalties, suspension or termination of certification, and referral for criminal enforcement where appropriate.
(v)No impact on other care. Penalties under this subparagraph apply only to benefits under this paragraph and shall not affect eligibility for other covered medical services under this Act.
(J)Domestic and regional sourcing preference.
(i)U.S. grown first. As a condition of certification under subparagraph (F), an approved vendor shall procure food inputs and packaged components that are grown, raised, or produced in the United States to the maximum extent practicable, as determined by the Secretary.
(ii)Regional preference default. For unprocessed or minimally processed agricultural products used in medically tailored meals and clinical food packages, an approved vendor shall apply a regional preference default by prioritizing procurement from producers located within the State where the member receives delivery or within 400 miles of the delivery location, as determined by the Secretary.
(iii)Waivers. The Secretary may waive the requirements of clause (i) or (ii) only upon a determination of nonavailability, unreasonable cost, or a public interest need related to continuity of clinically appropriate nutrition therapy.
(iv)Transparency. Vendors shall submit sourcing attestations and origin reporting in a form specified by the Secretary. The Secretary shall publish aggregated vendor sourcing performance measures that protect patient privacy and proprietary pricing.
(K)Farm to clinic procurement lane.
(i)In general. The Secretary may enter into contracts, cooperative agreements, and procurement vehicles, including in coordination with the Department of Agriculture, to support domestic and regional sourcing for medically tailored nutrition under this paragraph.
(ii)Producer access. The Secretary shall structure solicitations and purchasing vehicles to enable participation by small and midsize producers and producer cooperatives, including through aggregation mechanisms, standardized specifications, and prompt payment requirements.
(iii)Resilience and surge capacity. The Secretary may establish regional backup sourcing and surge protocols to maintain continuity of medically tailored nutrition during emergencies, supply disruptions, or vendor failure.
(b)Preexisting conditions. The System shall not exclude or limit coverage of any essential health
service because such service is related to a preexisting condition.
(c)Supplemental services. The Secretary may define categories of non essential services that
may be offered as supplemental coverage, including elective cosmetic procedures, concierge
amenities, and similar items, provided that such services are not required for medical necessity.
SEC. 105.CERTIFIED BASIC COVERAGE AND REGULATED UTILITY REQUIREMENTS.
(a)Certified Basic Coverage requirement.
(1)In general. Essential health services for members shall be covered through certified plans under this section. A health benefit plan or private health insurer may provide coverage for the essential benefit floor only if it is certified as a certified plan under this section.
(2)Federal benefit floor. Each certified plan shall cover, at a minimum, the essential health services described in section 104, including the same scope and cost sharing rules applicable to the Federal Standard Plan, except as expressly authorized by the Secretary for standardized plan designs under subsection (d)(4).
(3)No skimping. A certified plan may not impose exclusions, limitations, prior authorization practices, or network designs that have the purpose or effect of materially denying or delaying access to essential health services compared to the Federal Standard Plan, under standards prescribed by the Secretary.
(b)Guaranteed issue and community rating.
(1)Guaranteed issue. A certified plan shall accept every applicant who is eligible for enrollment as a member, during open enrollment and special enrollment periods established under title III.
(2)Community rating. For the essential benefit floor, a certified plan shall not vary premiums, contributions, or member charges based on health status, claims history, genetic information, or any other health factor, under standards prescribed by the Secretary.
(3)Non discrimination in enrollment practices. A certified plan shall not use marketing, benefit design, provider network design, formularies, administrative barriers, or differential customer service to discourage enrollment by individuals with high expected costs, under standards prescribed by the Secretary.
(4)No member premiums for the essential benefit floor. A certified plan may not charge a member any premium, enrollment fee, or other periodic charge for coverage of essential health services. Financing for essential health services shall occur through Trust Fund mechanisms under title II, including risk adjusted payments under section 207A.
(c)Utility style operating limits.
(1)Administrative load cap. The Secretary shall establish an administrative load cap for certified plans for the essential benefit floor, including limits on executive compensation allocations, marketing expenses, broker commissions, and profit. The cap shall be set at a level consistent with utility style administration and shall be reviewed not less frequently than every 2 years.
(2)Medical loss ratio floor. The Secretary shall establish a minimum percentage of expenditures that must be directed to payment for essential health services and quality improvement activities for members.
(3)Marketing limits. The Secretary shall prohibit or strictly limit paid marketing and enrollment steering practices for certified plans that increase system wide administrative cost without improving access or quality.
(4)Standardized plan designs. The Secretary may establish a limited set of standardized plan designs for the essential benefit floor to reduce complexity, provided that such designs do not reduce the benefit floor and are applied uniformly across certified plans.
(d)Mandatory participation in national infrastructure.
(1)Universal Rate Schedule. A certified plan and any subcontractor acting on its behalf shall pay for essential health services furnished to members only in accordance with the Universal Rate Schedule established under section 402.
(2)Mandatory clearinghouse. A certified plan and any subcontractor acting on its behalf shall use the National Health Claims Data Platform for eligibility, claims submission, claims adjudication, payment routing, remittance, and required reporting for essential health services furnished to members, in accordance with section 801.
(3)Uniform rules. A certified plan may not require providers to use proprietary billing formats, proprietary attachments standards, or proprietary prior authorization portals for essential health services. The Platform standards shall control.
(4)Data and audit cooperation. A certified plan shall submit all data required by the Secretary for risk adjustment, integrity, access, and quality oversight, and shall submit to audits under sections 207A and 801.
(e)Supplemental coverage.
(1)In general. Private entities may sell supplemental coverage that offers services or amenities beyond the essential benefit floor, such as private rooms, elective cosmetic procedures, or additional convenience benefits, so long as such coverage does not:
(A)deny or delay access to essential services;
(B)condition access to essential services on purchase of supplemental coverage; or
(C)undermine risk adjustment, enrollment integrity, or the stability of certified plan financing.
(2)Separation. Supplemental coverage shall be operationally and financially separate from the essential benefit floor, under standards prescribed by the Secretary.
(f)Certification, supervision, and enforcement.
(1)Certification. The Secretary shall establish a certification process, including application, renewal, and decertification standards, for certified plans. Certification shall be conditioned on compliance with this section, title II financing and reporting requirements, the Universal Rate Schedule, and Platform participation.
(2)Corrective action ladder. The Secretary shall establish a corrective action ladder for certified plans.
(A)Notice of deficiency. The Secretary shall issue a written notice that identifies the deficiency, the evidence supporting the determination, and the required remediation timeline.
(B)Corrective action plan. The Secretary shall require a corrective action plan with measurable milestones and weekly or monthly reporting as specified by the Secretary.
(C)Probation. If deficiencies persist, the Secretary may place the certified plan on probation, impose civil monetary penalties, require provider and member notices, and require operational changes.
(D)Supervision. If deficiencies remain material, the Secretary may impose supervised administration, including directed staffing, data submission directives, and restrictions on utilization management.
(E)Enrollment limits and freeze. If the Secretary determines that member protection requires it, the Secretary may impose enrollment limits or an enrollment freeze and may redirect new default enrollments to the Federal Standard Plan.
(F)Decertification. For material or repeated violations, the Secretary shall decertify the certified plan. Decertification shall trigger member protections under paragraph (3), including automatic transfer and continuity of care rules.
(3)Member protection on decertification. If a certified plan is decertified or exits the market, the Secretary shall implement an automatic transfer process that preserves continuity of care, including ongoing treatment authorizations, through the Platform and under standards specified by the Secretary.
(g)ERISA application and anti avoidance.
Notwithstanding section 514 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1144), the provisions of this Act shall apply to all employee benefit plans, including self insured plans, to the extent necessary to enforce certified plan requirements, the Universal Rate Schedule, Platform participation, and title II contributions. No employer may use an employee benefit plan to avoid contribution requirements or to provide non certified basic coverage for essential health services to members.
TITLE II. FINANCING AND THE SAFECARE TRUST FUND.
TITLE II—FINANCING AND THE SAFECARE TRUST FUND.
SEC. 201.SAFECARE TRUST FUND.
(a)Establishment. There is created in the Treasury a trust fund to be known as the SAFECARE Trust Fund.
(b)Credits to the Trust Fund. The Trust Fund shall be credited with:
(1)amounts equivalent to employer contributions required under section 202;
(2)amounts equivalent to individual and self employment contributions required under section 203;
(3)amounts transferred or credited from integrated Federal and State programs as provided in title X, subject to section 207; and
(4)any other amounts appropriated to the Trust Fund.
(c)Expenditures. Amounts in the Trust Fund shall be available without fiscal year limitation for:
(1)risk adjusted payments and other transfers to certified plans for essential health services furnished to members, including reinsurance and risk adjustment transfers under section 207A;
(2)payments for essential health services furnished to members through the National Health Claims Data Platform payment rail, under section 801, including payments routed on behalf of certified plans;
(3)administration of the System, including the Marketplace, certification, oversight, and Platform operations;
(4)programs under titles V, VI, VII, VIII, and IX; and
(5)other activities authorized by this Act.
(d)Long-Term Services and Supports Sub-Account.
(1)Establishment. There is established within the Trust Fund a Long-Term Services and Supports Sub-Account (in this title referred to as the "LTSS Sub-Account").
(2)Initial allocation percentage. Not later than 90 days before the main implementation date under section 1103(b), the Chief Actuary of the Centers for Medicare and Medicaid Services shall certify in writing, and the Secretary shall publish concurrently in the Federal Register, the initial LTSS Allocation Percentage. The initial LTSS Allocation Percentage shall be set so that projected LTSS Sub-Account inflows equal the Chief Actuary's certified projection of LTSS outlays under section 104(a)(13) for the first fiscal year of System operation, expressed as a percentage of the Chief Actuary's certified projection of total Trust Fund receipts for that fiscal year. The Chief Actuary's certification shall be published in full alongside the Secretary's notice and shall be treated as the actuarial basis of record for purposes of any judicial or administrative review of the initial percentage.
(3)Annual crediting. For each fiscal year, the Secretary shall credit to the LTSS Sub-Account, from amounts credited to the Trust Fund under subsection (b), the percentage of such amounts equal to the LTSS Allocation Percentage then in effect.
(4)Availability. Amounts in the LTSS Sub-Account shall be available without fiscal year limitation exclusively for payment of long-term services and supports under section 104(a)(13) and for administration of such services.
(5)Adjustment. The LTSS Allocation Percentage may be adjusted only through the corrective action process under section 201A(c)(1)(B) and only upon enactment of an Act of Congress expressly specifying a revised percentage.
(6)Rule of construction. Nothing in this subsection shall be construed to alter contribution rates under sections 202 and 203, to create any new contribution, tax, or levy, or to alter the essential health services entitlement under section 103(a).
SEC. 201A.LTSS SUB-ACCOUNT SOLVENCY MANAGEMENT.
(a)Purpose. The purpose of this section is to ensure that long-term services and supports are managed as a fiscally distinct program lane within the Trust Fund, and to prevent LTSS outlays from creating structural pressure on core essential health services funding under sections 104(a)(1) through (a)(12).
(b)Annual actuarial review. Not later than March 31 of each year, the Chief Actuary of the Centers for Medicare and Medicaid Services shall submit to the Secretary and to the relevant Congressional committees a report on the actuarial status of the LTSS Sub-Account, including:
(1)projected LTSS outlays under section 104(a)(13) for the current and 5 succeeding fiscal years;
(2)projected LTSS Sub-Account inflows for the same period under the current LTSS Allocation Percentage;
(3)projected LTSS Sub-Account end-of-year balance for each such fiscal year; and
(4)identification of material changes in LTSS utilization, eligibility patterns, demographic trends, or cost drivers.
(5)projected Member Income Contribution receipts under section 104(a)(13)(K) for the current and 5 succeeding fiscal years, including the assumed participation rate, average monthly contribution per member, and estimated number of institutionalized members subject to the contribution.
(6)the annual actuarial review shall additionally include: an estimate of the projected LTSS costs attributable to members subject to the recent arrival rule under section 104(a)(13)(L)(iv)(C); the projected bond and insurance compliance rate among qualifying sponsors, based on System enrollment data; the estimated annual surety bond face value obligations outstanding; the estimated recovery amounts collected under section 104(a)(13)(M)(iv), disaggregated from Member Income Contribution receipts and from standard LTSS Sub-Account outlays; and the Chief Actuary's assessment of whether sponsor bond and recovery receipts are sufficient to materially offset projected LTSS Sub-Account outlays attributable to the recent arrival population.
(c)Corrective action trigger.
If the Chief Actuary determines that projected LTSS Sub-Account outlays will exceed projected LTSS Sub-Account inflows by more than 10 percent in any 2 consecutive fiscal years within the 5-year projection window, the Secretary shall:
(1)not later than 180 days after such determination, submit to Congress a corrective plan that:
(A)identifies the drivers of the projected imbalance;
(B)proposes a revised LTSS Allocation Percentage and any adjustments to LTSS eligibility clarification, utilization management, or care coordination tools available under section 104(a)(13) and applicable regulations; and
(C)includes, if the Secretary determines appropriate, a recommendation to activate the Long-Term Care Insurance Modernization provisions under title XIV;
(2)implement any adjustments under paragraph (1)(B) that are within existing regulatory authority, subject to notice-and-comment rulemaking; and
(3)not reduce or eliminate covered services under section 104(a)(13) without an Act of Congress, except to the extent such adjustments fall within existing eligibility clarification authority under section 104(a)(13)(I).
(d)No cross-lane subsidy.
The Secretary shall not use amounts allocated to the LTSS Sub-Account to pay for essential health services under sections 104(a)(1) through (a)(12), and shall not use amounts outside the LTSS Sub-Account to pay for long-term services and supports under section 104(a)(13), except:
(1)during the period before the initial LTSS Allocation Percentage takes effect under section 201(d)(2);
(2)in a public health emergency declared by the Secretary, for a period not to exceed 90 days, with concurrent notification to Congress; or
(3)pursuant to a temporary liquidity advance authorized under subsection (e).
(e)Temporary liquidity support.
(1)Authority. If the Secretary determines that amounts in the LTSS Sub-Account are insufficient to meet payment obligations under section 104(a)(13) for a payment period, and that such insufficiency is not the result of a failure to make the annual credit required under section 201(d)(3), the Secretary may advance amounts from the general Trust Fund to the LTSS Sub-Account solely to prevent interruption of payments to providers and members. For purposes of this subsection, the term "payment period" means the standard claims payment cycle applicable under the prompt payment standards established by the Secretary under section 801 for claims processed through the National Health Claims Data Platform.
(2)Cap. The total outstanding principal of advances under this subsection shall not exceed 15 percent of total projected LTSS Sub-Account outlays for the fiscal year in which the advance is made, as certified by the Chief Actuary under subsection (b). The Secretary may not make an advance under this subsection that would cause the outstanding principal to exceed such cap.
(3)Mandatory repayment. Any advance under this subsection shall be repaid to the general Trust Fund from future LTSS Sub-Account allocations not later than 3 fiscal years after the advance is made. The Secretary shall establish a repayment schedule at the time of each advance and shall include the repayment status in each annual actuarial review under subsection (b).
(4)Notification. The Secretary shall notify the relevant Congressional committees within 15 days of any advance under this subsection, including the amount, the basis for the determination, and the repayment schedule.
(5)No recurrence as substitute for correction. An advance under this subsection shall not substitute for the corrective action requirements under subsection (c). If an advance is made and the conditions triggering the advance persist for 2 consecutive payment periods, the Secretary shall treat the condition as a corrective action trigger under subsection (c)(1) regardless of whether the 10 percent threshold has been met.
(f)Rule of construction. Nothing in this section shall be construed to alter the essential health services entitlement under section 103(a), to require any reduction in LTSS benefits absent an Act of Congress, or to create any individual right to a specific benefit level beyond what section 104(a)(13) provides.
SEC. 202.EMPLOYER HEALTH CONTRIBUTION DETERMINATION (IMPOSED UNDER 26 U.S.C. 3111(g) AND 1401(d)).
(a)In general. For purposes of sections 3111(g) and 1401(d) of the Internal Revenue Code of 1986 (as added by section 1303 of this Act), the National Health Employer Contribution for any calendar year shall be determined under this section with respect to covered wages (as defined in subsection (d)).
(b)Standard rate. The standard contribution rate shall be 8.0 percent of wages described in subsection (a).
(c)Small employer rate. Congress may provide a reduced rate for employers with annual wages described in subsection (a)
below a threshold specified in law to protect small businesses.
(d)Replacement of private premiums. The contribution required under this section is intended to
replace employer expenditures on basic health insurance premiums. Employers shall not be
required to maintain separate basic coverage for essential services, but may offer supplemental
coverage as allowed under section 105.
(e)Anti-Avoidance Rule for Contract Labor.
(1)In general. For purposes of this section, the term "wages" includes covered contract remuneration.
(2)Covered contract remuneration defined. The term "covered contract remuneration" means remuneration paid by an employer to an individual for services performed as an independent contractor (as such status is reported for Federal tax purposes), if either of the following applies:
(A)Primary service dependence. More than 50 percent of the individual's gross receipts from the performance of services during the taxable year (or during the most recent taxable year for which information is available, as specified by the Secretary of the Treasury) is attributable to such employer, including any person treated as the same employer under rules prescribed by the Secretary of the Treasury.
(B)Substantial control. The employer exercises substantial control over the manner and means by which the services are performed, under standards prescribed by the Secretary of the Treasury consistent with common law agency principles.
(3)Liability. In the case of covered contract remuneration, the employer shall be liable for the contribution under this section at the rate specified in subsection (b) with respect to such remuneration.
(4)Credit to contractor. The Secretary of the Treasury shall prescribe rules under which any amount paid by an employer under paragraph (3) with respect to covered contract remuneration shall be allowed as a credit to the individual receiving such remuneration against the portion of such individual's liability under section 203 attributable to such remuneration. Any excess credit shall be treated as a payment of tax for purposes of section 203.
(f)Maintenance of total compensation and Health Efficiency Dividend.
(1)Maintenance of total compensation. Beginning on the main implementation date, an employer shall not reduce total compensation for a covered employee as a result of this Act. For purposes of this subsection, total compensation means wages plus the employer's baseline annual employer health benefit value, as determined under paragraph (2), for the applicable employee classification, expressed on an annualized basis.
(2)Baseline annual employer health benefit value.
(A)In general. The Secretary of the Treasury, in consultation with the Secretary of Labor, shall establish standard methods and safe harbors to determine, for each employer, the baseline annual employer health benefit value per employee, based on the applicable base period, as defined in subparagraph (C).
(B)Included amounts. Such value shall reflect the employer's reasonable expenditures to provide or finance basic health coverage, including premium payments, contributions to self insured plan costs, and required administrative fees, net of any employee premiums deducted from wages.
(C)Base period; coverage tiers; stabilized tier baseline.
(i)Base period. The applicable base period means the 2 most recent employer plan years ending before the main implementation date.
(ii)Coverage tier included in classification. For purposes of this subsection, the term 'employee classification' shall include the employee's coverage tier for the applicable base period, determined under clause (iii). Coverage tiers shall include, as applicable:
(I)waived or not enrolled for any month,
(II)employee only,
(III)employee plus spouse,
(IV)employee plus dependent child or children,
(V)family.
(iii)Tier determination for employees; month counting.
(I)In general. For each plan year in the base period, an employee's coverage tier shall be the tier in which the employee was enrolled for the greatest number of months in such plan year.
(II)Month counting rule. An employee shall be treated as enrolled in a tier for a month if the employee is enrolled in such tier for any day during such calendar month. The Secretaries may prescribe equivalent rules for non calendar plan administration where necessary to ensure consistent counting.
(III)Tie rule. In the case of a tie, the higher tier shall apply.
(IV)Not enrolled. An employee not enrolled for any month in such plan year shall be treated as waived or not enrolled for such plan year.
(iv)Tier baseline for each plan year. For each plan year in the base period, the Secretary of the Treasury, in consultation with the Secretary of Labor, shall determine the employer's baseline annual employer health benefit value for each employee classification and coverage tier, reflecting the employer's reasonable expenditures described in subparagraph (B), net of employee premium contributions.
(v)Stabilized baseline amount for the base period; tier specific application. The baseline annual employer health benefit value applicable to an employee's classification and coverage tier for purposes of paragraph (4) shall be determined separately for each employee classification and coverage tier and shall equal:
(I)the average of the amounts determined under clause (iv) for the 2 plan years in the base period for such employee classification and coverage tier, but
(II)not less than 90 percent of the higher of such 2 amounts.
(vi)Insufficient history. If an employer has only 1 plan year ending before the main implementation date for which amounts can be determined under clause (iv), the base period shall consist of such plan year only and the baseline shall be determined using such plan year.
(vii)Waived or not enrolled baseline; limited de minimis administrative amount. For the coverage tier described in clause (ii)(I), the baseline annual employer health benefit value shall be zero, except that the Secretary may allow a de minimis administrative amount where the employer substantiates a direct employer paid cost attributable to such employees under the employer plan. Any such de minimis administrative amount shall be capped and shall not exceed a percentage of the employee only baseline specified by the Secretary.
(D)Anti gaming and safe harbors.
(i)Anti gaming. In determining amounts under this paragraph, the Secretaries shall disregard any changes in plan design, contribution strategy, eligibility rules, classification structures, enrollment inducements, or benefit substitutions adopted with a principal purpose or a significant purpose of reducing the baseline annual employer health benefit value or the Health Efficiency Dividend.
(ii)Safe harbors. The Secretaries shall establish administrable safe harbor methods, including methods for fully insured plans (premium and employer contribution schedules) and self insured plans (actuarially reasonable premium equivalents), and simplified methods for small employers. The Secretaries may establish deemed safe harbor amounts for very small employers or start up employers lacking certified actuarial support, provided such deemed amounts are designed to be reasonable, uniform, and administrable.
(iii)Recordkeeping. Employers shall retain records sufficient to substantiate tier determination and baseline calculations for not less than 6 years.
(3)New required health cost.
(A)In general. For each covered employee, the employer's new required health cost for a plan year shall equal the employer health contribution paid for such employee under subsection (a) for that plan year, plus any employer paid supplemental coverage amounts that the Secretary determines are properly treated as health spend for purposes of this subsection.
(B)Single stream financing rule. No employer shall be required to pay, and no certified plan may require, employer paid premiums for the essential benefit floor. Employer obligations for the essential benefit floor are satisfied through subsection (a) and the Trust Fund payment mechanisms under sections 201 and 207A.
(4)Dividend calculation. For each covered employee, the Health Efficiency Dividend for a plan year shall equal the baseline annual employer health benefit value applicable to the employee's classification, minus the employer's new required health cost for that plan year. The Dividend shall not be less than zero.
(5)Payment and administration.
(A)Form of payment. An employer shall pay the Health Efficiency Dividend as additional wages on a pro rata basis across payroll periods, or as an equivalent contribution to pension or other employee benefit funds, or as a combination of such wages and contributions, as the employer elects, subject to subparagraph (B).
(B)Collective bargaining. For employees covered by a collective bargaining agreement, the manner of providing the Dividend under subparagraph (A) shall be consistent with such agreement, or if the agreement is silent, as determined through collective bargaining.
(C)Recordkeeping and notice. The Secretary of the Treasury shall prescribe reporting and recordkeeping requirements and model notices to employees for purposes of verifying compliance with this subsection.
(6)Duration and safe harbor.
(A)Duration. The requirements of this subsection shall apply for the first 10 years beginning on the main implementation date.
(B)Safe harbor transition. After the period described in subparagraph (A), the Secretary of Labor may establish safe harbors under which employers that demonstrate sustained compliance and absence of substitutionary compensation reductions are deemed to satisfy the maintenance of total compensation requirement.
(7)Enforcement.
(A)Primary enforcement. The Secretary of Labor shall enforce this subsection, including by receiving complaints, conducting investigations, and imposing civil monetary penalties.
(B)Anti retaliation. An employer may not discharge or discriminate against an employee for asserting rights under this subsection.
(C)Coordination. The Secretaries of Labor and the Treasury shall coordinate enforcement with payroll reporting and tax compliance.
(8)Public employer opt-in for Health Efficiency Dividend.
(A)Private employers. Paragraphs (1) through (7) apply to all private employers and all private collective bargaining agreements. With respect to employees covered by a private collective bargaining agreement, the collective bargaining agreement shall govern the form and allocation of the Health Efficiency Dividend, including whether it is paid as wages or provided through employee benefits. No private collective bargaining agreement may eliminate the obligation to provide the Health Efficiency Dividend for covered employees.
(B)Public employers optional. With respect to employees of a public employer, paragraphs (1) through (7) shall apply only if the public employer elects to participate in the Health Efficiency Dividend requirements under paragraphs (1) through (7). An election under this subparagraph shall apply to all employees of such public employer, including employees covered by a collective bargaining agreement and employees not covered by a collective bargaining agreement.
(C)Public employer defined. In this paragraph, the term public employer means:
(i)the United States, including civilian agencies and the uniformed services
(ii)any State government and any political subdivision of a State
(iii)any local government, including any school district or public authority
(iv)any Tribal government
(D)Election authority. An election under subparagraph (B) shall be made by:
(i)in the case of the United States, the Office of Personnel Management for civilian employees and the Secretary of Defense for the uniformed services
(ii)in the case of a State government, the Governor or equivalent executive authority
(iii)in the case of a local government, school district, or public authority, the elected governing body or equivalent governing authority
(iv)in the case of a Tribal government, the authorized Tribal governing body
(E)Default rule and effect of non-election. If a public employer does not elect participation under subparagraph (B), paragraphs (1) through (7) shall not apply with respect to such public employer and no Health Efficiency Dividend under paragraph (3) shall be required with respect to employees of such public employer. Nothing in this paragraph shall be construed to affect the liability of a public employer for the contribution under subsection (a).
(g)Collection and codification. The National Health Employer Contribution required under this section, including amounts attributable to covered contract remuneration under subsection (e), shall be treated as the tax imposed by section 3111(g) of the Internal Revenue Code of 1986 and shall be assessed, collected, and paid in the same manner as the taxes imposed under chapter 21 of such Code.
SEC. 203.INDIVIDUAL HEALTH CONTRIBUTION DETERMINATION (IMPOSED UNDER 26 U.S.C. 59B).
(a)In general. For purposes of section 59B of the Internal Revenue Code of 1986 (as added by section 1303 of this Act), the National Health Individual Contribution for any taxable year shall be determined under this section. Nothing in this section shall be construed to impose a separate tax or fee; the tax described in this section is imposed solely under section 59B of the Internal Revenue Code of 1986 (as added by section 1303 of this Act).
(b)Contribution Base and Modified Adjusted Gross Income. The contribution under this section
shall apply to the Modified Adjusted Gross Income of the individual for the taxable year,
determined on an individual basis.
(1)Modified Adjusted Gross Income defined. For purposes of this section, the term "Modified
Adjusted Gross Income" means adjusted gross income as defined in section 62 of the Internal
Revenue Code of 1986-
(A)Increased by:
(i)any tax-exempt interest received or accrued during the taxable year, and
(ii)the amount of any income from sources within United States territories (including Puerto
Rico, Guam, American Samoa, the Northern Mariana Islands, and the Virgin Islands) that is
excluded from gross income under section 933 of such Code or similar provisions, determined as
if such income were effectively connected with the conduct of a trade or business within the
United States.
(B)Reduced by:
(i)Qualified Business Income Deduction. An amount equal to the deduction allowed under
section 199A of such Code for the taxable year.
(ii)Social Security Benefits. Any amount received as benefits under title II of the Social Security
Act or tier 1 railroad retirement benefits which is included in gross income for the taxable year.
(iii)Veterans Benefits. Any amount received as benefits administered by the Department of
Veterans Affairs which is included in gross income for the taxable year.
(iv)Retirement Income Allowance. The aggregate amount of distributions from eligible
retirement plans (as defined in section 402(c)(8)(B) of such Code) and from individual
retirement plans (as defined in section 7701(a)(37) of such Code) included in gross income for
the taxable year, not to exceed the Retirement Exemption Limit.
(2)Retirement Exemption Limit.
(A)In general. The Retirement Exemption Limit shall be $100,000.
(B)Indexing. In the case of any taxable year beginning in a calendar year after 2026, the dollar
amount in subparagraph (A) shall be increased by an amount equal to-
(i)such dollar amount, multiplied by
(ii)the cost-of-living adjustment determined under section 1(f)(3) of the Internal Revenue Code
of 1986 for the calendar year in which the taxable year begins.
(c)Rate.
(1)Base individual rate. Except as provided in paragraph (2), the base individual health
contribution rate shall be 3.5 percent of Modified Adjusted Gross Income, applied from the
first dollar, with no minimum income threshold.
(2)Base self employed rate. In the case of net earnings from self employment, as determined under section 1402(a) of the Internal Revenue Code of 1986, the base rate shall be equal to the sum of the National Health Employer Contribution base rate under section 202(b)(1) and the base individual rate under paragraph (1), as each is adjusted under section 206. Such base self employed rate shall apply to such net earnings, applied from the first dollar, in lieu of the rate under paragraph (1) on such net earnings.
(3)Additional surtax on high income. In addition to the base rate in this subsection, an
additional health surtax shall apply to Modified Adjusted Gross Income in the following
marginal brackets:
(A)1.0 percent of Modified Adjusted Gross Income above 100,000 dollars.
(B)An additional 1.5 percent of Modified Adjusted Gross Income above 250,000 dollars.
(C)An additional 2.0 percent of Modified Adjusted Gross Income above 500,000 dollars.
(4)Additional self employed surtax. In addition to the base rate in paragraph (2), the
additional surtax in paragraph (3) shall apply to net earnings from self employment described
in paragraph (2) using the same marginal brackets.
(5)Indexing of thresholds. Beginning in calendar year 2031, the dollar thresholds in
paragraph (3) shall be adjusted not less than once every three years, based on growth in
median wages, under a methodology specified by the Secretary.
(d)Collection, estimated payments, and annual reconciliation.
(1)Withholding on wages. Employers shall withhold the base contribution under subsection
(c)(1) from wages paid to employees and remit such amounts to the Treasury in the same
manner as employment taxes are withheld and paid. Amounts withheld shall be treated as a
credit against the liability imposed by section 59B of the Internal Revenue Code of 1986 (as added by section 1303 of this Act) for the taxable year. Such withholding shall be treated as withholding under section 3402(u) of the Internal Revenue Code of 1986.
(2)Estimated payments on non wage income. Individuals with non wage income shall make
estimated tax payments consistent with section 6654 of the Internal Revenue Code of 1986,
as prescribed by the Secretary of the Treasury, to avoid material underpayment.
(3)Annual reconciliation. The Secretary of the Treasury shall prescribe regulations to
reconcile amounts withheld and estimated payments against the total liability under this
section on the individual's annual Federal income tax return.
(e)Replacement of private premium payments. The individual health contribution is intended
to replace private expenditures on basic health insurance premiums and deductibles for
essential care.
(f)Critical biologics supply contribution credit.
(1)In general. In the case of an individual designated as a Qualified Critical Biologics Supply Partner under section 204(f), there shall be allowed a credit against the liability imposed by section 59B of the Internal Revenue Code of 1986 (as added by section 1303 of this Act) for the taxable year.
(2)Credit amount. The credit under paragraph (1) shall be equal to the applicable percentage of the individual’s liability under subsection (c)(1), as follows.
(A)Tier 1, critical supply partner. In the case of a Tier 1 designation under section 204(f)(2)(A), 100 percent.
(B)Tier 2, supply partner. In the case of a Tier 2 designation under section 204(f)(2)(B), 50 percent.
(3)Limitation based on existing thresholds. The credit allowed under this subsection shall not exceed the amount of contribution that would otherwise be imposed under subsection (c)(1) on Modified Adjusted Gross Income not exceeding the threshold described in subsection (c)(3)(B), as adjusted under subsection (c)(5). For avoidance of doubt, any contribution attributable to Modified Adjusted Gross Income above such threshold remains payable.
(4)Recapture and pro rata adjustment. If an individual’s designation under section 204(f) is terminated during a taxable year due to voluntary withdrawal or failure to maintain material compliance, the credit shall be reduced on a pro rata basis for the portion of the taxable year after such termination, under rules prescribed by the Secretary of the Treasury.
(5)Rule of construction. Nothing in this subsection shall be construed to provide payment or other valuable consideration for the transfer of a human organ for transplantation.
SEC. 203A.RELIGIOUS SECT CONTRIBUTION EXEMPTION.
(a)Individual health contribution. No individual health contribution under section 203 shall be imposed on an individual for any period during which the individual holds a religious sect waiver under section 302A.
(b)Payroll health contribution coordination.
(1)In general. The Secretary shall coordinate the payroll health contribution under section 202 with section 302A so that no payroll health contribution is imposed with respect to wages of an employee for any period during which the employee holds a religious sect waiver supported by an approved form described in section 302A(b)(1), subject to paragraph (2).
(2)Employer coordination. The Secretary may apply payroll contribution coordination under paragraph (1) only to the extent the Secretary determines, based on the approved form and associated verification, that the coordination is consistent with the scope and period of the approved form and does not permit avoidance by nonqualifying employers or employees.
(3)No alternative pathway. No exclusion, adjustment, or coordination under this subsection may be granted absent an approved form described in section 302A(b)(1).
(c)Rule of construction. Nothing in this section shall be construed to create a constitutional entitlement to exemption.
SEC. 204.POINT OF SERVICE COST SHARING, PROHIBITION ON DEDUCTIBLES,
(a)No deductibles and no coinsurance. The System shall not impose deductibles or coinsurance for
essential health services. Any point of service cost sharing under this section shall be in the form
of fixed copayments only.
(b)Children and low income individuals. members who are under age 18, and System
members with individual modified adjusted gross income, as defined in section 203(b), below
200 percent of the Federal poverty level applicable to a single individual, shall receive essential
health services with no point of service copayments.
(c)Standard copayments. For members not described in subsection (b), the Secretary may
establish modest fixed copayments for certain non emergency services, subject to the annual cap
in subsection (d). The Secretary shall design copayments to avoid discouraging preventive care
and clinically indicated treatment.
(d)Annual cap.
(1)In general. Each member shall have a fixed annual cap on total point of service
copayments for essential health services.
(2)Initial cap. The initial cap shall be 750 dollars per person per year in 2026 dollars.
(3)Indexing. The cap shall be indexed annually to growth in median wages, under a
methodology specified by the Secretary.
(4)After cap reached. After the cap is reached for a member, the System shall pay 100 percent of
covered essential health services for that member for the rest of the year.
(e)Per person rule. The cap applies per individual and shall not increase due to marriage,
household composition, or enrollment of dependents.
(f)Critical biologics supply partner waiver.
(1)In general. Notwithstanding subsection (d), the annual copayment cap shall be reduced to 0 dollars for any member designated by the Secretary as a Qualified Critical Biologics Supply Partner under this subsection, for the period of such designation.
(2)Designation and tiers. The Secretary shall establish a designation process with two tiers.
(A)Tier 1, critical supply partner. The Secretary may grant a Tier 1 designation to a member whose participation is necessary to maintain a reliable domestic supply of a clinically critical biologic product or rare transfusion compatible blood component, as determined by the Secretary using objective scarcity and supply vulnerability criteria.
(B)Tier 2, supply partner. The Secretary may grant a Tier 2 designation to a member whose participation materially increases availability for hard to source biological materials or compatible cell donations, using objective scarcity criteria determined by the Secretary.
(3)Eligible categories and objective criteria. A designation under this subsection may include, subject to regulation, a member who meets one or more of the following criteria as determined by the Secretary.
(A)Rare blood phenotype participation. The member has a rare blood phenotype identified through clinically accepted rare donor frameworks and participates in scheduled collections when medically eligible.
(B)Therapeutic plasma participation. The member participates in scheduled apheresis programs that support plasma derived products subject to documented supply vulnerability.
(C)Cell donor readiness participation. The member maintains ready to donate status for hematopoietic stem cell donation through methods permitted under Federal law, under standards established by the Secretary.
(D)Clinical data contribution participation. The member voluntarily authorizes use of longitudinal, de identified health data for evidence based standard setting under safeguards established by the Secretary, including consent, privacy, and revocation protections.
(4)Participation standards and medical deferral. The Secretary shall define material compliance and participation standards. Such standards shall include safe harbors for medical deferral, pregnancy, temporary contraindications, or other clinical reasons a collection or donation cannot occur.
(5)Voluntary participation and withdrawal. Participation is voluntary. A member may withdraw at any time through a simple process. Benefits under this subsection shall terminate prospectively upon withdrawal, under rules specified by the Secretary.
(6)Separation from organ allocation. Designation under this subsection shall not affect organ transplantation allocation decisions under section 104(a)(14) and shall not be used as an allocation criterion for solid organ transplantation.
(7)Rule of construction. Nothing in this subsection shall be construed to provide payment or other valuable consideration for the transfer of a human organ for transplantation.
(g)LTSS income-based cost sharing.
(1)In general. Notwithstanding subsection (a), for members receiving long-term services and supports under section 104(a)(13), the Secretary may establish fixed periodic copayments applicable to members with household modified adjusted gross income, as defined in section 203(b), above 400 percent of the Federal poverty level applicable to the member's household size. Such copayments shall be assessed monthly or quarterly per member, not per service unit or per service visit, as the Secretary determines appropriate for administrative consistency.
(2)Cap. Copayments under this subsection shall not exceed $3,000 per member per calendar year, indexed annually under the methodology in subsection (d)(3). After the annual cap is reached, the System shall pay 100 percent of covered long-term services and supports under section 104(a)(13) for that member for the remainder of the calendar year.
(3)Rate and conversion. The copayment rate shall not exceed
(A)1.0 percent of household modified adjusted gross income above 400 percent of the applicable Federal poverty level per year, for members with income between 400 and 600 percent of such level; and
(B)1.5 percent of household modified adjusted gross income above 600 percent of the applicable Federal poverty level per year, in addition to the amount under subparagraph (A), for members with income above 600 percent of such level.
The Secretary shall convert the applicable annual percentage into an equivalent fixed periodic dollar amount for the calendar year, determined at the start of each calendar year based on the member's most recently available household modified adjusted gross income, and shall notify the member of such amount at or before the start of the period to which it applies. The fixed periodic amount shall not be recalculated mid-year except upon a qualifying change in household income or household size as defined in regulations.
(4)Trigger. Copayments under this subsection apply only during periods in which a member is actively receiving covered long-term services and supports under section 104(a)(13). No copayment under this subsection shall be assessed for, or accrued with respect to, any calendar year in which the member does not receive any long-term services and supports under section 104(a)(13).
(5)No prior payment condition and recovery. Eligibility for and receipt of services under section 104(a)(13) shall not be conditioned on prior payment of copayments under this subsection. Unpaid copayments shall be recoverable through the same reconciliation and recovery mechanisms used for cost-sharing amounts under this section, as prescribed by the Secretary of the Treasury, and shall be treated as cost-sharing obligations for purposes of collection, lien authority, and enforcement, consistent with the inheritance protections under section 104(a)(13)(A) through (H). No lien or recovery may be imposed against a protected primary residence as defined in section 104(a)(13)(B)(ii) solely by reason of unpaid copayments under this subsection, except as provided in section 104(a)(13)(F).
(6)Crediting. Amounts collected as copayments under this subsection shall be credited exclusively to the LTSS Sub-Account under section 201(d) and shall be treated as dedicated receipts for purposes of section 207(b)(1). Such amounts shall not be treated as general Trust Fund receipts for purposes of section 206 reserve ratio calculations.
(7)Household size and income determination. For purposes of this subsection, household size and household modified adjusted gross income shall be determined under rules prescribed by the Secretary of the Treasury, consistent with the household composition and income rules applicable under section 36B of the Internal Revenue Code of 1986, to address married filing separately, dependents, multi-member households, and equivalent situations. The Secretary of the Treasury shall prescribe rules to prevent manipulation of household composition for purposes of avoiding copayments under this subsection.
(8)Termination upon Title XIV activation. Upon activation of title XIV under section 1401, copayments under this subsection shall terminate as of the effective date specified in the activating Act of Congress and shall be replaced by the contribution and benefit structure under title XIV. No member shall be subject to both the copayments under this subsection and the contribution under section 1404 for the same period. The Secretary shall provide not less than 180 days advance notice to members before termination takes effect.
(9)SSI coordination. For members receiving Supplemental Security Income under title XVI of the Social Security Act, the Secretary, in coordination with the Commissioner of Social Security, shall establish procedures to ensure that copayments assessed under this subsection do not duplicate cost-sharing obligations imposed under the personal needs allowance rules applicable to institutionalized individuals under title XVI. No copayment under this subsection shall be assessed against a member's SSI personal needs allowance as defined in section 104(a)(13)(K)(iv). The Secretary may waive or defer copayments under this subsection for any member whose countable monthly income as defined in section 104(a)(13)(K)(iii), excluding the personal needs allowance, does not exceed 200 percent of the applicable Federal poverty level for a single individual. For purposes of this subsection, the definitions and standards established under section 104(a)(13)(K)(iii) and (iv) shall govern the determination of countable monthly income and personal needs allowance, and shall be applied consistently across this subsection and section 104(a)(13)(K) to prevent inconsistent treatment of the same member.
SEC. 205.REPLACEMENT OF MEDICARE HOSPITAL INSURANCE PAYROLL
(a)Replacement of Hospital Insurance payroll taxes. Beginning on the main implementation
date, the Hospital Insurance portion of employment taxes under the Internal Revenue Code of
1986 shall be reduced to 0 percent for wages and self employment income that are subject to
contributions under sections 202 and 203 of this Act.
(b)Conforming amendments to Internal Revenue Code of 1986.
(1)Employee Hospital Insurance tax. Section 3101(b) of the Internal Revenue Code of 1986
is amended by adding at the end the following new paragraph:
"(3) Coordination with SAFECARE System. In the case of wages received by an individual with
respect to whom the contribution under section 203 of the Secure Affordable Federal Essential
Care Act is in effect for the payroll period, the rate of tax under subsection (b)(1) shall be
0 percent."
(2)Employer Hospital Insurance tax. Section 3111(b) of the Internal Revenue Code of 1986
is amended by adding at the end the following new paragraph:
"(3) Coordination with SAFECARE System. In the case of wages paid to an individual with
respect to whom the contribution under section 203 of the Secure Affordable Federal Essential
Care Act is in effect for the payroll period, the rate of tax under subsection (b)(1) shall be
0 percent."
(3)Self employment Hospital Insurance tax. Section 1401(b) of the Internal Revenue Code of
1986 is amended by adding at the end the following new paragraph:
"(3) Coordination with SAFECARE System. In the case of self employment income of an
individual with respect to whom the contribution under section 203 of the Secure Affordable
Federal Essential Care Act is in effect for the taxable year, the rate of tax under subsection
(b)(1) shall be 0 percent."
(c)Coordination with remaining Federal health revenues. Beginning on the first day of the first
calendar year that starts at least two years after the date of enactment, specified portions of other
existing Federal health related tax revenues and program receipts, as determined by Congress,
may be credited to the Trust Fund, subject to section 207.
(d)Consolidation of program budgets. As programs are integrated into the System under title X,
their budget authority for essential health services shall be consolidated into the Trust Fund.
(e)No double payroll charge. It is the intent of Congress that, beginning on the main
implementation date, the employer and employee Hospital Insurance payroll tax is replaced by
the contributions under sections 202 and 203, and is not imposed in addition to them.
(f)Repeal of Net Investment Income Tax.
(1)In general. Section 1411 of the Internal Revenue Code of 1986 (imposing a tax on net
investment income) is repealed.
(2)Effective date. The repeal made by this subsection shall apply to taxable years beginning on
or after the main implementation date described in section 1103(b).
SEC. 206.TRUST FUND RESERVE STABILIZATION AND AUTOMATIC RATE
(a)Purpose. The purpose of this section is to maintain a stable Trust Fund reserve sufficient to address
unexpected costs and economic fluctuations, without deficit financing.
(b)Reserve target band. The Secretary shall administer the Trust Fund to maintain a reserve ratio within a
target band of not less than 5 percent and not more than 10 percent.
(c)Reserve ratio defined. For purposes of this section, the term "reserve ratio" means the ending Trust
Fund balance for a fiscal year divided by projected Trust Fund outlays for the immediately following
fiscal year, as determined by the Chief Actuary of the Centers for Medicare and Medicaid Services.
(d)Automatic upward adjustment. If the Chief Actuary determines that the reserve ratio for a fiscal year
is below 5 percent, then for the following calendar year the rates under sections 202 and 203 shall be
increased as follows:
(1)Employer rate increase. The rate in section 202(b) shall increase by 0.20 percentage points.
(2)Base individual rate increase. The base employee rate in section 203(c)(1) shall increase by 0.10
percentage points.
(3)Base self employed rate increase. The base self employed rate in section 203(c)(2) shall increase by
0.30 percentage points.
(4)Surtax rate increase. Each additional surtax rate in section 203(c)(3) shall increase by 0.10 percentage
points, and the corresponding surtax rates applied under section 203(c)(4) shall increase by the same
amount.
(e)Automatic downward adjustment. If the Chief Actuary determines that the reserve ratio for a fiscal
year is above 10 percent, then for the following calendar year the rates under sections 202 and 203 shall
be decreased as follows:
(1)Employer rate decrease. The rate in section 202(b) shall decrease by 0.20 percentage points.
(2)Base individual rate decrease. The base employee rate in section 203(c)(1) shall decrease by 0.10
percentage points.
(3)Base self employed rate decrease. The base self employed rate in section 203(c)(2) shall decrease by
0.30 percentage points.
(4)Surtax rate decrease. Each additional surtax rate in section 203(c)(3) shall decrease by 0.10 percentage
points, and the corresponding surtax rates applied under section 203(c)(4) shall decrease by the same
amount.
(f)Annual adjustment limits. In any single year, the total adjustment under subsection (d) or (e) and under
section 207(f)(3) shall not exceed:
(1)0.60 percentage points for the employer rate,
(2)0.30 percentage points for the base employee rate and any surtax rate adjustments under paragraphs
(d)(4) and (e)(4), and
(3)0.90 percentage points for the base self employed rate.
(g)Notice and publication. Not later than November 15 of each year, the Secretary shall publish in the
Federal Register the reserve ratio determination and any rate adjustments for the following year.
(h)Congressional override. Congress may override an automatic adjustment for a year by enactment of a
law that expressly provides an alternative rate schedule for that year.
(i)Initial stabilization lock.
(1)In general. Notwithstanding subsection (d) and section 207(f)(3), during the stabilization lock period no increase in any rate under sections 202 and 203 may take effect, including an automatic upward adjustment under subsection (d) or a dedicated funding convergence adjustment under section 207(f)(3), except by an Act of Congress that expressly provides an alternative rate schedule.
(2)Stabilization lock period. The term "stabilization lock period" means the period beginning on the main implementation date described in section 1103(b) and ending on December 31 of the third calendar year beginning after such date.
(3)Downward adjustments permitted. Nothing in this subsection shall be construed to prevent a decrease in rates under subsection (e) during the stabilization lock period.
(4)Transparency. The Secretary shall include, in the annual notice under subsection (g), a statement of whether the stabilization lock period is in effect and any statutory rate changes enacted under paragraph (1).
SEC. 207.GENERAL FUND RELIANCE REDUCTION AND DEDICATED FUNDING
(a)Purpose. The purpose of this section is to reduce reliance on discretionary transfers from
general Federal revenues, to strengthen long term fiscal sustainability, and to ensure that
universal essential coverage is funded primarily through dedicated receipts and mandatory
integrated program transfers.
(b)Definitions. In this section:
(1)Dedicated receipts. The term dedicated receipts means amounts credited to the Trust Fund
from:
(A)employer and employee contributions under sections 202 and 203
(B)self employment contributions under section 203
(C)copayments collected under section 204
(D)civil monetary penalties, recoveries, and recoupments under this Act
(E)mandatory integrated program transfers under subsection (d)
(F)other receipts that are permanently dedicated to the Trust Fund by law
(2)General Fund transfer. The term General Fund transfer means any amount appropriated or
transferred to the Trust Fund from the general fund of the Treasury or from other general revenue
accounts that are not dedicated receipts, including discretionary annual appropriations and
emergency supplemental appropriations, except as provided in subsection (e).
(c)Limitation on General Fund transfers.
(1)Transition limitation schedule. For each fiscal year of the Trust Fund beginning on or after
the main implementation date, discretionary General Fund transfers under subsection (b)(2) shall
not exceed the following percentages of total Trust Fund outlays for that fiscal year:
(A)For the first and second such fiscal years, 20 percent
(B)For the third and fourth such fiscal years, 10 percent
(C)For the fifth and sixth such fiscal years, 5 percent
(D)For the seventh and eighth such fiscal years, 2 percent
(E)For the ninth such fiscal year and each fiscal year thereafter, 0 percent
(2)Rule of construction. Nothing in this subsection limits the crediting of dedicated receipts to
the Trust Fund, including mandatory integrated program transfers under subsection (d).
(d)Mandatory integrated program transfers.
(1)Medicare Parts B and D. Notwithstanding any other provision of law, effective on the date
specified in section 1005(b), amounts that would otherwise be provided from general revenues for
Medicare Part B and Medicare Part D benefits under title XVIII of the Social Security Act shall
be credited directly to the Trust Fund as dedicated receipts under subsection (b)(1)(E). Such
amounts shall equal:
(A)for the first fiscal year after the main implementation date, the prior year's general revenue
subsidy for Medicare Parts B and D, adjusted by the medical care component of the Consumer
Price Index
(B)for each subsequent fiscal year, the prior year's amount adjusted by the growth rate of
nominal gross domestic product per capita, as published by the Bureau of Economic Analysis
(2)Federal Medicaid match. Notwithstanding any other provision of law, effective on the date
specified in section 1005(b), amounts that would otherwise be provided from general revenues for
Federal Medicaid matching payments under title XIX of the Social Security Act shall be credited
directly to the Trust Fund as dedicated receipts under subsection (b)(1)(E). Such amounts shall
equal:
(A)for the first fiscal year after the main implementation date, the prior year's Federal Medicaid
matching payments, adjusted by the medical care component of the Consumer Price Index
(B)for each subsequent fiscal year, the prior year's amount adjusted by the growth rate of
nominal gross domestic product per capita
(3)Affordable Care Act premium tax credits and cost sharing reductions. Notwithstanding any
other provision of law, effective on the date specified in section 1005(b), amounts that would
otherwise be provided for premium tax credits and cost sharing reductions under sections 1401
and 1402 of the Patient Protection and Affordable Care Act shall be credited directly to the Trust
Fund as dedicated receipts under subsection (b)(1)(E). Such amounts shall equal:
(A)for the first fiscal year after the main implementation date, the prior year's expenditures for
such subsidies, adjusted by the medical care component of the Consumer Price Index
(B)for each subsequent fiscal year, the prior year's amount adjusted by the growth rate of
nominal gross domestic product per capita
(4)Veterans Health Administration. Notwithstanding any other provision of law, effective on the
date specified in section 1005(b), amounts that would otherwise be appropriated for healthcare
services provided by the Department of Veterans Affairs shall be credited directly to the Trust
Fund as dedicated receipts under subsection (b)(1)(E). Such amounts shall equal:
(A)for the first fiscal year after the main implementation date, the prior year's appropriation for
such services, adjusted by the medical care component of the Consumer Price Index
(B)for each subsequent fiscal year, the prior year's amount adjusted by the growth rate of
nominal gross domestic product per capita
(5)Federal Employees Health Benefits Program. Notwithstanding any other provision of law,
effective on the date specified in section 1005(b), the Federal Government's contribution to health
benefits under chapter 89 of title 5, United States Code, for essential health services shall be
credited directly to the Trust Fund as dedicated receipts under subsection (b)(1)(E). Such amounts
shall equal:
(A)for the first fiscal year after the main implementation date, the prior year's total Federal
contribution for essential health services, adjusted by the medical care component of the Consumer
Price Index
(B)for each subsequent fiscal year, the prior year's amount adjusted by the growth rate of
nominal gross domestic product per capita
(6)TRICARE and uniformed services health programs. Notwithstanding any other provision of
law, effective on the date specified in section 1005(b), amounts that would otherwise be
appropriated for healthcare services under chapter 55 of title 10, United States Code, and other
uniformed services health programs shall be credited directly to the Trust Fund as dedicated
receipts under subsection (b)(1)(E). Such amounts shall equal:
(A)for the first fiscal year after the main implementation date, the prior year's appropriation for
such services, adjusted by the medical care component of the Consumer Price Index
(B)for each subsequent fiscal year, the prior year's amount adjusted by the growth rate of
nominal gross domestic product per capita
(7)Indian Health Service. Notwithstanding any other provision of law, effective on the date
specified in section 1005(b), amounts that would otherwise be appropriated for healthcare services
provided by the Indian Health Service shall be credited directly to the Trust Fund as dedicated
receipts under subsection (b)(1)(E). Such amounts shall equal:
(A)for the first fiscal year after the main implementation date, the prior year's appropriation for
such services, adjusted by the medical care component of the Consumer Price Index
(B)for each subsequent fiscal year, the prior year's amount adjusted by the growth rate of
nominal gross domestic product per capita
(8)Phased crediting during implementation. For fiscal years during which integration occurs
under section 1005, amounts credited under paragraphs (1) through (7) for a fiscal year shall be
proportionate to the share of beneficiaries and members for whom the covered program components
have been integrated during that fiscal year, as determined by the Secretary and the Chief Actuary.
(9)Status as mandatory appropriations. Amounts credited under this subsection constitute
mandatory budget authority and shall be treated as dedicated receipts for purposes of subsection
(b)(1) and subsection (c)(2).
(e)Temporary advances during recession or public health emergency.
(1)In general. If the Secretary determines that a recession has been declared by the National
Bureau of Economic Research, or that a national public health emergency has been declared under
Federal law, the Secretary may request a temporary advance to the Trust Fund from general
Federal revenues in excess of the applicable limitation under subsection (c).
(2)Repayment. Any advance under paragraph (1) shall be repaid to the general fund of the
Treasury from dedicated receipts not later than the end of the third fiscal year after the advance is
made.
(3)Limit. The total amount of outstanding advances under this subsection shall not exceed 0.5
percent of gross domestic product, as most recently published by the Bureau of Economic
Analysis.
(f)Compliance mechanism and corrective actions.
(1)Annual projection. Not later than November 15 of each year, the Chief Actuary shall publish
a projection of the amount of discretionary General Fund transfers, if any, that would be required
to maintain System operations for the following fiscal year.
(2)Required corrective actions. If the projection under paragraph (1) indicates that discretionary
General Fund transfers would exceed the limitation under subsection (c) for the following fiscal
year, the Secretary shall implement corrective actions in the following order, to the extent
practicable:
(A)Strengthen enforcement of prescription drug and biologic pricing requirements under section
405, including tighter review of exceptions under section 405(e)
(B)Reduce administrative cost and denial friction through actions under sections 403, 404, and
804, including simplification of documentation and standardized billing rules
(C)Adjust payment policy within the guardrails of section 402, including site of service rules,
payment methods that reward value, and targeted updates that protect rural and safety net access
(3)Dedicated funding convergence adjustment. If the Secretary determines, after implementing
corrective actions under paragraph (2), that discretionary General Fund transfers would still exceed
the limitation under subsection (c), then for the following calendar year the rates under sections
202 and 203 shall, subject to section 206(i), be increased by the amounts described in section 206(d), and may be increased
in subsequent years until the projected discretionary General Fund transfers are within the
applicable limitation. Such adjustments shall be subject to the annual limits in section 206(f).
(g)Cost growth discipline.
(1)Benchmark. The Secretary shall administer the System to limit the growth rate of average Trust
Fund outlays per member to a benchmark equal to the growth rate of nominal gross domestic
product per capita, as most recently published by the Bureau of Economic Analysis.
(2)Corrective action. If the Chief Actuary determines that projected outlay growth exceeds the
benchmark, the Secretary shall publish a corrective plan that prioritizes actions under subsection
(f)(2) before reliance on contribution rate increases.
(h)Reports.
(1)Annual report. Not later than 180 days after the end of each fiscal year, the Secretary shall
submit to Congress a report describing:
(A)progress toward reducing reliance on discretionary General Fund transfers
(B)compliance with the schedule in subsection (c)
(C)total mandatory integrated program transfers credited under subsection (d)
(D)the amount and share of Trust Fund revenue from each source category under subsection
(b)(1)
(E)any corrective actions taken under subsection (f)
(2)Public transparency. The Secretary shall publish a public dashboard displaying Trust Fund
revenue sources, including clear identification of:
(A)new dedicated payroll and income contributions under sections 202 and 203
(B)mandatory integrated program transfers under subsection (d)
(C)State maintenance of effort payments
(D)copayments and other program receipts
(E)any discretionary General Fund transfers under subsection (c) or emergency advances under
subsection (e)
SEC. 207A.RISK ADJUSTMENT AND REINSURANCE FOR CERTIFIED PLANS.
(a)In general. Payments from the Trust Fund to certified plans for members shall be risk adjusted to reflect expected differences in health status and other legitimate cost factors, under a methodology established by the Secretary.
(b)Risk adjustment methodology.
(1)Core model requirements. The Secretary shall establish a transparent risk adjustment model that uses diagnosis and demographic factors and that includes hierarchical condition categories. The model shall include not fewer than 80 condition categories, shall be designed to reduce incentives for risk selection, and shall support fair competition on service quality, access, and administrative efficiency.
(2)Factors. The model shall incorporate age, sex, disability status, partial year enrollment, newborn status, and other objective factors specified by the Secretary. The Secretary may include pharmacy based indicators for conditions that are systematically under coded, provided that safeguards prevent gaming.
(3)Geographic cost adjustment. The Secretary may apply a limited geographic input cost adjustment using objective wage and input indices, at a level of geography not smaller than the county, to reflect legitimate variation in input costs. Such adjustment may not be used to reward inefficiency.
(4)Coding intensity adjustment. The Secretary shall apply coding intensity adjustments and other normalization techniques to prevent systematic diagnosis inflation, including comparisons to historical baselines and peer group controls.
(5)Publication. The Secretary shall publish model documentation, coefficients, updates, and validation results, and shall provide sufficient technical detail for independent review.
(6)Budget neutrality. Risk adjustment transfers shall be implemented in a manner that is budget neutral across certified plans for each payment year, except to the extent that the Secretary establishes separate reinsurance under subsection (c).
(c)System wide reinsurance.
(1)In general. The Secretary shall establish a system wide reinsurance program to protect certified plans from extreme, unpredictable costs and to reduce incentives to avoid high cost members.
(2)Parameters. The Secretary shall establish attachment points, coinsurance, and caps for reinsurance, and shall review such parameters annually to ensure stability of the System and the Trust Fund.
(3)High cost condition focus. The Secretary may include condition based or episode based reinsurance components for predictable catastrophic categories, including transplant, hemophilia, and other high cost categories, provided that such components are standardized and auditable.
(d)Risk corridors and payment stability.
(1)In general. The Secretary may establish limited risk corridors for certified plan payments to reduce volatility during the transition period. Any corridor shall be formula based, time limited, and designed to remain consistent with budget neutrality.
(2)Anti overpayment rule. Risk corridors may not be used to create an uncapped guarantee of profit.
(e)Data submission and integrity.
(1)Encounter completeness. Certified plans shall submit complete and timely encounter and claims data through the National Health Claims Data Platform in the form and manner specified by the Secretary.
(2)Data quality thresholds. The Secretary shall establish data quality thresholds. Failure to meet thresholds may result in payment holds, payment adjustments, corrective action plans, or enrollment limits.
(f)Audits and anti gaming safeguards.
(1)Annual audits. The Secretary shall conduct annual audits of risk adjustment data and coding practices, including targeted audits for upcoding and systematic diagnosis inflation.
(2)Penalties. If the Secretary determines that a certified plan received excess payment due to improper coding, incomplete encounter data, or other manipulation, the Secretary shall recoup the excess payment and shall impose a civil monetary penalty of not less than 1 time and not more than 3 times the excess payment, and may require corrective action plans.
(3)Enrollment limits. For material or repeated violations, the Secretary may impose enrollment limits or an enrollment freeze for the certified plan.
(4)Decertification. Material or repeated violations under this subsection constitute grounds for decertification under section 105(f).
(g)Independent evaluation.
(1)In general. Not less frequently than every 2 years, the Secretary shall commission an independent evaluation of the risk adjustment and reinsurance programs, including tests for selection incentives, coding inflation, and access impacts.
(2)Corrective updates. The Secretary shall update methodologies and safeguards based on the evaluation results.
TITLE III. ELIGIBILITY, ENROLLMENT, AND CONTINUITY.
TITLE III—ELIGIBILITY, ENROLLMENT, AND CONTINUITY.
SEC. 301.ELIGIBLE INDIVIDUALS.
(a)Full members. Every legal resident of the United States is eligible to be a full System
member.
(b)Non members. Non members are not members, except as provided for the Bridge option
in section 603.
SEC. 302.DEFAULT ENROLLMENT WITH CHOICE.
(a)Procedures. The Secretary shall establish procedures to automatically enroll legal residents as members in certified plans, using existing Federal and State records such as Social Security, immigration, and tax records.
(b)Default assignment and annual open enrollment.
(1)Default assignment. If an eligible individual does not affirmatively select a certified plan during an enrollment period, the Secretary shall assign the individual to the Federal Standard Plan. The Secretary may assign an individual to another certified plan only to preserve continuity of care or to avoid a material provider access disruption, under uniform standards that prevent risk selection. The Federal Standard Plan shall be available in every service area as the default certified plan.
(2)Annual open enrollment. The Secretary shall provide an annual open enrollment period during which a member may select among available certified plans, including the Federal Standard Plan, effective for the next coverage year, under rules prescribed by the Secretary.
(3)Special enrollment. The Secretary shall establish special enrollment periods for defined life events, including birth, adoption, marriage, relocation, and loss of other qualifying coverage, under rules prescribed by the Secretary.
(c)Opt out.
(1)In general. An eligible individual may elect to opt out of membership in the System during an enrollment period established under subsection (b), by filing an affirmative opt out election in the form and manner specified by the Secretary.
(2)Consequences. An individual who opts out:
(A)shall not be eligible for coverage of essential health services under this Act, except as provided for emergency and stabilization services under title VI, during a waiting period described in subparagraph (B);
(B)may not re enroll as a member for a period of not less than 24 months beginning on the effective date of the opt out election, except that the Secretary may allow earlier re enrollment only for narrowly defined hardship or safety exceptions;
(C)shall not be eligible for any income based cost sharing protections under section 204 during the waiting period; and
(D)shall remain liable for contributions under title II, because such contributions are taxes imposed for purposes of national health infrastructure and financing.
(3)Late enrollment protections. The Secretary may establish a standardized late enrollment surcharge, applied for a limited duration after re enrollment, as an alternative to or in combination with the waiting period, provided that such surcharge is uniform, transparent, and administrable through tax reconciliation mechanisms.
(d)Federal Bypass Authority.
(1)State cooperation option. A State may elect to provide data necessary for enrollment under subsection (a). In exchange for such cooperation, the State shall receive administrative coordination payments under section 1006, in amounts and under standards specified by the Secretary.
(2)Federal default. If a State elects not to provide such data under paragraph (1), or fails to provide such data within 30 days after the start of an enrollment period specified by the Secretary, the Secretary shall execute enrollment for residents of such State using exclusively Federal data sources, including data from the Internal Revenue Service, the Social Security Administration, the Department of Homeland Security, and such other Federal sources as the Secretary determines appropriate.
(3)Consequence. A State declining cooperation under paragraph (1) shall be ineligible for the administrative coordination payments described in that paragraph for the period of noncooperation.
SEC. 302A.RELIGIOUS SECT OPT OUT STATUS.
(a)Establishment. The Secretary shall establish a process under which an individual may elect a religious sect opt out status.
(b)Sole eligibility gateway.
(1)In general. The Secretary may approve a religious sect opt out status under this section only if the applicant submits an Internal Revenue Service approved Form 4029, or any successor form designated by the Internal Revenue Service for the same purpose, that is valid for the applicant for the applicable period.
(2)No alternative pathway. No individual shall be eligible for a religious sect opt out status under this section absent an approved form described in paragraph (1).
(3)Verification. The Secretary shall verify the approval status and period of validity of the form described in paragraph (1) through data matching or other verification methods established by the Secretary.
(c)Effect.
(1)Non member status. An individual approved under this section shall be treated as a non member for purposes of this Act during the approved period.
(2)Waiver of System benefits. During the approved period, the individual shall waive all rights to benefits under this Act as a member, including claims submission and appeals rights.
(3)Private payment permitted. Nothing in this section prohibits an individual from purchasing services privately, including through self pay or private arrangements.
(4)Emergency care. Nothing in this section authorizes denial or delay of emergency screening or stabilizing treatment required under other Federal law.
(d)Coordination with opt out rules.
(1)Relationship to section 302. An individual approved under this section shall be treated as having elected an opt out under section 302(c) for the same period.
(2)Contribution coordination. Contribution exemptions for individuals approved under this section shall be governed by section 203A.
(e)Re entry and late enrollment treatment.
(1)Open enrollment requirement. Re entry after a period under this section shall occur only during an annual open enrollment period under section 302(b)(2), except as provided in paragraph (3).
(2)Late enrollment surcharge. An individual who re enters after a period under this section shall be subject to a standardized late enrollment surcharge under section 302(c)(3). The Secretary may set a higher surcharge for such individuals, provided that the surcharge is uniform, transparent, time limited, and administrable through tax reconciliation.
(3)Loss of approval status. If an individual loses approval status under Form 4029 through expiration, revocation, or other loss of validity, the Secretary shall permit the individual to enroll at the next open enrollment period, and the Secretary may establish a short special enrollment period if the loss of approval would otherwise create a gap.
SEC. 303.IDENTIFICATION AND RECORDS.
(a)System identifier. Each member shall be assigned a unique System identifier. The Secretary
may use an existing Federal identifier if appropriate.
(b)Privacy. The Secretary shall maintain secure electronic records of enrollment and claims.
Health data shall be protected by privacy laws and shall not be used for immigration enforcement
or non health purposes.
(c)Employer payroll status verification.
(1)System. The Secretary, in coordination with the Secretary of the Treasury, shall establish a
secure electronic verification mechanism for employers.
(2)Function. An employer may submit the name and Taxpayer Identification Number of an
employee to query whether such employee is currently subject to the contribution requirements of
section 203 for the payroll period.
(3)Response. The system shall return a single binary response indicating whether the SAFECARE
contribution applies. The system shall not disclose the underlying reason.
(4)Safe harbor. An employer who relies on a response from this system in good faith to determine
withholding and remittances under sections 202, 203, and 205 shall not be liable for underpayment
penalties related to such determination.
SEC. 303A.DATA SYSTEMS READINESS, INCREMENTAL DEPLOYMENT, AND
(a)Claims and enrollment systems. The Secretary shall develop and deploy the enrollment,
eligibility verification, claims intake, claims adjudication, payment, and program integrity
systems necessary to administer the System.
(b)Incremental deployment. The Secretary shall deploy System systems in phases, including pilots
and regional rollouts, to ensure continuity of care and to reduce implementation risk.
(c)Independent certification of readiness.
(1)In general. Not later than 180 days before the start of automatic enrollment under section
1005(b), 1005(c), 1005(d), or 1005(e), as applicable to the affected phase, the Secretary shall obtain an independent certification that core enrollment and claims
systems are capable of operating at scale.
(2)Certifying entities. The certification shall be performed by the Inspector General of the
Department of Health and Human Services, in consultation with the Government Accountability
Office, or by an independent entity designated by them.
(3)Criteria. Certification shall assess at minimum:
(A)cybersecurity and privacy controls,
(B)identity and eligibility matching accuracy,
(C)claims throughput and payment timeliness,
(D)error rates and appeals handling capacity,
(E)disaster recovery and continuity planning, and
(F)interoperability with State and Federal data sources required for enrollment and coordination,
(G)certified plan onboarding and connectivity readiness, including end-to-end enrollment and claims transactions through the Platform for each certified plan and the Federal Standard Plan,
(H)Marketplace plan choice, switching, and reconciliation operations required under title III, including testing of edge cases and continuity protections, and
(I)risk adjustment and reinsurance operations under section 207A, including data pipelines, transfer calculations, payment timing, auditability, and anti-gaming controls.
(d)Contingency authority.
(1)If certification under subsection (c) is not obtained, the Secretary shall delay the affected
phase of automatic enrollment for not more than 12 months and shall implement a corrective
action plan.
(2)During any such delay, individuals shall retain existing coverage and protections, and the
Secretary shall prioritize enrollment of uninsured individuals and individuals in integrated
Federal programs for whom readiness is certified.
(e)Transparency.
(1)Public dashboard. The Secretary shall maintain a public dashboard reporting implementation
progress, major milestones, system performance metrics, and independent audit findings.
(2)Reports. Not later than 90 days after enactment and every 180 days thereafter until full
implementation, the Secretary shall submit to Congress a report describing progress, risks, and
mitigation steps.
SEC. 303B.CONTINUITY BACKSTOP FOR OPERATIONAL PERFORMANCE FAILURE.
(a)Definitions.
(1)Clean claim. The term “clean claim” means a claim submitted in the format and with the documentation required by the Secretary that does not require additional information from the provider or member to adjudicate.
(2)Performance quarter. The term “performance quarter” means a calendar quarter for which the Secretary publishes final system performance metrics on the public dashboard required under section 303A(e).
(3)Independent auditor. The term “independent auditor” means the Inspector General of the Department of Health and Human Services, in consultation with the Government Accountability Office, or an independent entity designated by them, consistent with section 303A(c)(2).
(b)Backstop triggers.
The Continuity Backstop shall activate if the independent auditor determines, based on published metrics, that a trigger under paragraph (1) and a trigger under paragraph (2) have both occurred for 2 consecutive performance quarters.
(1)Claims timeliness trigger.
(A)Fewer than 92 percent of clean claims are paid within 30 days after receipt, or
(B)fewer than 98 percent of clean claims are paid within 60 days after receipt.
(2)Service continuity triggers.
Any of the following:
(A)Access trigger. Median time to the next available appointment for primary care exceeds 15 days in more than 20 percent of counties.
(B)Emergency readiness trigger. Emergency transport readiness or emergency department network readiness falls below minimum standards established under section 303C for more than 15 percent of counties.
(C)Network adequacy trigger. Network adequacy for essential services falls below minimum standards established by the Secretary for more than 15 percent of counties.
(c)Independent measurement, transparency, and anti-gaming.
(1)Methodologies. The independent auditor shall specify methodologies for each trigger, including data sources, auditability, validation rules, and protections against manipulation.
(2)Public reporting. The Secretary shall publish trigger metrics, findings, activation notices, and deactivation notices on the dashboard under section 303A(e).
(3)Anti-sabotage. Any person or entity that knowingly engages in a pattern of conduct intended to degrade performance metrics to trigger or prolong the Backstop shall be subject to civil penalties, exclusion, and recovery actions as determined by the Secretary.
(d)Activation and duration.
(1)Activation. Not later than 30 days after a determination under subsection (b), the Secretary shall activate the Continuity Backstop.
(2)Duration. The Backstop shall remain active for 12 months.
(3)Extension. The Backstop may be extended once for an additional 12 months only if the conditions in subsection (b) persist for 2 consecutive performance quarters during the active period.
(4)Deactivation. The Backstop shall automatically deactivate after 2 consecutive performance quarters in which no trigger in subsection (b) is met.
(e)Backstop authorities.
During any period the Backstop is active, the Secretary shall implement one or more of the following, limited to restoring compliance:
(1)Claims stabilization. Surge staffing, emergency claims processing contracts, and accelerated interim payments to participating providers, subject to audit, recoupment, and program integrity controls.
(2)Continuity gap protection. Where the Backstop is active in a county due to access, emergency readiness, or network adequacy, the Secretary shall ensure access to covered essential services, and member cost exposure shall not exceed the in-network cost sharing that would have applied if adequate participating capacity had been available.
(3)Targeted provider stabilization add-ons. Temporary add-on payments targeted to the county, service line, or facility category associated with the trigger, to restore essential capacity.
(f)No parallel system.
(1)No non certified basic coverage. Nothing in this section shall be construed to authorize a non certified product to provide the essential benefit floor for members. Coverage of essential health services for members shall be provided only through certified plans under section 105, subject to transition rules under section 1004.
(2)No preferential lanes. Continuity gap protection under subsection (e)(2) shall not permit underwriting, alternative benefit determinations, preferential provider networks, or features that create a two-tier system.
(g)Rule of construction.
This section supplements and does not replace readiness certification and phase delay authority under section 303A, and continuity of treatment protections under section 1004(b).
SEC. 303C.RURAL AND FRONTIER READINESS GUARANTEES.
(a)Rural readiness standards.
Not later than 18 months after enactment, the Secretary shall establish minimum national standards for rural and frontier readiness for the System, including standards for
(1)emergency transport availability, including aeromedical transport where clinically appropriate,
(2)emergency department readiness and trauma capability,
(3)maternity and newborn capability availability within reasonable travel time, and
(4)essential specialty access pathways for rural and frontier counties.
(b)County coverage map and certification.
The Secretary shall publish, as part of the dashboard under section 303A(e), a county-level readiness map showing compliance with subsection (a), and the independent auditor shall include rural and frontier readiness in readiness certification under section 303A(c).
(c)Interaction with payment policy.
The Secretary shall use the rural and frontier payment tools under section 402(c)(2), section 402(c)(5), and section 402(c)(6) to maintain compliance with readiness standards, including geographic adjustments, frontier access add-on payments, and aeromedical methodology with anti-gouging safeguards.
(d)Alaska rule of construction.
In implementing this section, the Secretary shall ensure that frontier definitions and eligibility standards do not exclude Alaska counties or communities with exceptional transport constraints, consistent with section 402(c)(5).
SEC. 303D.PROVIDER STABILIZATION CORRIDOR AND EXPANDED TRANSITION PROTECTIONS.
(a)Purpose.
The purpose of this section is to protect essential facility capacity and prevent avoidable closures during the early System years, while payment rates converge to long-term levels under section 402.
(b)Expansion of transitional corridor scope.
Section 402(c)(4) is amended as follows:
(1)In subparagraph (A), strike “acute care hospitals” and insert “acute care hospitals and such additional facility categories as the Secretary determines necessary to preserve access, including critical access hospitals, rural hospitals, frontier facilities, and essential safety-net hospitals.”
(2)In subparagraph (B), the Secretary may apply differentiated multipliers by category and geography, provided that any such differentiation is published with justification and is targeted to access preservation.
(c)Essential service line protection.
During years 3 through 5 of System operations, the Secretary shall prioritize stabilization support for essential rural service lines, including emergency and trauma, maternity and newborn, and other service lines necessary to meet the readiness standards under section 303C.
(d)Sunset.
Any corridor multipliers or add-ons applied under this section shall sunset not later than the end of the third calendar year of System operations, except frontier access add-ons under section 402(c)(5), which may continue when necessary to preserve access.
SEC. 303E.COST GOVERNANCE INTEGRATION AND OPERATIONAL CORRECTIVE ACTIONS.
(a)Integration with Trust Fund governance.
The Secretary shall administer Backstop actions under section 303B and rural readiness actions under section 303C in a manner consistent with Trust Fund reserve stabilization under section 206 and cost growth discipline under section 207(g).
(b)Corrective action sequencing.
If a Backstop period under section 303B results in material temporary increases in outlays, the Secretary shall treat such increases as “unexpected costs” for purposes of section 206(a) and shall prioritize corrective actions under section 207(f)(2) before any contribution rate increases beyond those already permitted by sections 206 and 207.
(c)Unified public transparency.
The dashboard under section 303A(e) shall include a dedicated Trust Fund and cost governance panel that displays, at minimum:
(1)reserve ratio status and any automatic adjustments under section 206,
(2)the GDP per capita benchmark and projected outlay growth under section 207(g),
(3)any corrective actions taken under section 207(f), and
(4)any Backstop activation, duration, and expenditures under section 303B.
(d)Rule of construction.
Nothing in this section limits the Secretary’s payment methodology authorities under section 402(a) or the existing corrective action authorities under section 207(f), and nothing in this section authorizes non certified basic coverage for essential health services for members, which must be provided only through certified plans under section 105.
SEC. 303F.NATIONAL PLAN INTEROPERABILITY AND PATIENT INTAKE REFORM.
(a)National System Record.
(1)In general. The Secretary shall establish and maintain, for each member, a secure
longitudinal electronic record, to be known as the National System Record, to support treatment,
payment, and health care operations under this Act.
(2)Exchange layer, not a replacement. The National System Record shall not be construed to replace a
participating provider's medical record. The National System Record is a System maintained continuity
and information exchange layer intended to reduce duplicative testing, reduce patient intake
friction, and improve continuity of care.
(3)Platform alignment. The National System Record shall be implemented in a manner consistent with
the national standards and technical infrastructure used for System administration and transactions
under section 801.
(b)Standardized patient intake and reuse.
(1)Standard intake packet. The Secretary shall establish a standardized System intake packet and a
standardized electronic intake format that may be reused across participating providers.
(2)Provider acceptance. A participating provider shall accept a member's System intake data in the
standardized format and may not require the member to re enter substantially identical information,
except where clinically necessary or required by applicable law.
(3)Member updates. The Secretary shall provide members a practical method to review and update
intake information, including demographic, contact, emergency, medication, allergy, and history
elements, and to transmit updates in the standardized format.
(c)Consent, privacy, and sensitive information principles.
(1)Member controlled permissions. The Secretary shall implement member facing controls that allow a
member to grant, limit, and revoke permissions for access to and exchange of information through the
National System Record, subject to paragraphs (2) and (3).
(2)Treatment coordination baseline. The Secretary may permit access and exchange necessary for
treatment coordination among participating providers when there is an active care relationship,
provided such access is limited to the minimum necessary for the clinical purpose and is logged
under paragraph (5).
(3)Sensitive information. The Secretary shall implement technical and policy controls to segment
sensitive categories of information and shall require affirmative, specific, and revocable member
authorization for provider to provider exchange of such sensitive information, except as permitted
under paragraph (4) for emergencies and as required by applicable Federal or State law.
(4)Emergency access. The Secretary shall establish a narrowly tailored emergency process permitting
access to and exchange of information without prior member authorization only when the member is
unable to consent and delay would create a material risk of serious harm. Each such access shall be
limited to the minimum necessary and shall be subject to retrospective review.
(5)Transparency and audit log. The Secretary shall provide each member access to an electronic log
showing, in a clear manner, access to and disclosures from the National System Record, including the
identity of the accessing or receiving entity, the date and time, and a general purpose category.
(6)Non health use prohibited. Information in the National System Record may not be used for marketing
or other non health purposes, and may not be used for immigration enforcement.
(7)No weakening of stricter protections. Nothing in this section shall be construed to preempt,
limit, or weaken any Federal or State law that provides greater confidentiality protections for any
category of health information.
(d)Standards and continuous improvement.
(1)Standards. The Secretary shall establish and update standards, implementation guidance, and
operational safeguards necessary to carry out this section, including standards for
interoperability, identity matching, minimum necessary exchange, auditability, and usability.
(2)Consultation. In carrying out paragraph (1), the Secretary shall consult the SAFECARE E-Health
Advisory Board established under section 303G.
SEC. 303G.SAFECARE E-HEALTH ADVISORY BOARD.
(a)Establishment. There is established an advisory board, to be known as the SAFECARE E-Health
Advisory Board (in this section referred to as the "Board").
(b)Purpose. The purpose of the Board is to advise the Secretary on the design, rollout, and
continuous improvement of System digital systems, including the National System Record and standardized
intake, so that the System evolves with technology without expanding the scope of this Act beyond
national health reform.
(c)Duties. The Board shall advise the Secretary on recommendations to implement and improve section
303B, including by developing a prioritized roadmap and proposed implementation specifications for:
(1)a simple electronic authorization tool that allows a member to authorize one clinician or entity
to disclose specified information to another identified clinician or entity for treatment
coordination, including easy revocation and time limited defaults,
(2)segmentation rules for sensitive categories of information and the consent thresholds that apply
to provider to provider exchange of those categories,
(3)a minimum necessary care coordination summary format for disclosures to recipients that are not
participating providers, including school counseling professionals, without granting such recipients
direct system access,
(4)audit log usability standards so members can understand who accessed or received information and
why,
(5)narrowly tailored emergency access rules and retrospective review triggers,
(6)standardized intake reuse rules, including which elements should not be repeatedly retyped and
how updates propagate,
(7)provider directory and identity validation practices that reduce misrouting and consent errors,
(8)member correction and dispute workflows for inaccurate information, including annotation and
provenance handling,
(9)baseline privacy and security controls and update cycles, including resilience against emerging
threats, and
(10)metrics and reporting that measure reduced friction, reduced duplication, improved safety, and
reduced administrative burden.
(d)Scope and limits.
(1)Advisory only. The Board is advisory. No recommendation of the Board shall be binding on the
Secretary.
(2)No rulemaking or adjudication. The Board shall not issue regulations, adjudicate claims, or
direct day to day System operations.
(3)No benefits expansion. Nothing in this section shall be construed to expand benefits,
eligibility, or payment policies.
(e)Membership.
(1)Composition. The Board shall consist of 9 voting members appointed by the Secretary for 3 year
terms, and shall include:
(A)2 patients or consumer advocates with demonstrated experience in digital access and usability,
(B)2 practicing clinicians in primary care,
(C)2 practicing clinicians in specialty care, including at least 1 with rural or frontier
experience,
(D)1 health information technology architect or engineer with interoperability implementation
experience, and
(E)1 privacy or cybersecurity expert with health data systems experience.
(2)Chair and designated Federal officer. The Secretary shall designate a Federal officer or
employee to serve as the nonvoting chair and designated Federal officer for the Board, who shall
approve meeting agendas and may adjourn a meeting when necessary.
(3)Conflicts of interest. A member shall comply with applicable ethics rules and shall recuse from
Board matters that directly and predictably affect a financial interest of the member.
(4)Staggered initial terms. Of the members first appointed, 3 shall serve 1 year terms, 3 shall
serve 2 year terms, and 3 shall serve 3 year terms, as designated by the Secretary, to establish
staggered rotation.
(f)Meetings and transparency.
(1)Meetings. The Board shall meet not less frequently than quarterly.
(2)Public access. Meetings and materials shall be public, except that the Secretary may withhold
specific materials to protect system security, procurement sensitive information, or protected
health information.
(3)Annual report. Not later than 180 days after the end of each fiscal year, the Board shall submit
to the Secretary and Congress a report describing recommendations, priorities, progress, and
unresolved risks.
(g)Administration and funding.
(1)Support. The Secretary shall provide administrative support to the Board.
(2)Funding. Activities under this section shall be funded from amounts otherwise available for
administration of the System, and no additional amounts are authorized to be appropriated.
(h)Federal advisory committee compliance. The Board shall be subject to chapter 10 of title 5,
United States Code, and applicable implementing regulations.
(i)Sunset. This section shall cease to have effect on the date that is 10 years after the main
implementation date described in section 1103(b).
SEC. 303H.RECIPROCAL TEMPORARY TRAVEL EMERGENCY COVERAGE AGREEMENTS.
(a)Authority.
The Secretary may enter into reciprocal agreements with one or more partner countries to
provide a limited, emergency only travel coverage mechanism for members who are
temporarily present in a partner country and for eligible visitors from a partner country
who are temporarily present in the United States.
(b)Partner country criteria and term.
An agreement under this section may be entered into only with a country that the Secretary
determines has a stable national or statutory health coverage mechanism, reliable
eligibility verification, and fraud controls sufficient to support reciprocal settlement.
Each agreement shall be for a fixed term not to exceed 5 years and may be renewed.
(c)Covered services and emergency limitation.
(1)members temporarily abroad.
For a member who is temporarily present in a partner country, covered services under an
agreement shall be limited to medically necessary emergency services furnished for an
emergency medical condition. Covered emergency services may include emergency evaluation,
emergency stabilization, emergency surgery, emergency inpatient care, and emergency medical
transportation, including air or ground transport when medically necessary. Covered services
may include emergency dental or emergency vision services only when necessary to treat acute
trauma, uncontrolled infection, sudden loss of function, or other acute emergencies where
delay would create a material risk of serious harm.
(2)Eligible visitors temporarily in the United States.
For an eligible visitor, covered services under an agreement shall be limited to medically
necessary emergency services furnished for an emergency medical condition. Nothing in this
paragraph alters section 602, including required services and reimbursement for non members.
The Secretary shall structure agreements so that eligible visitor emergency care is
reimbursed through the Safety Net Care Fund under sections 601 and 602 to the extent not
recovered from the partner country or the visitor's applicable coverage.
(3)Exclusions.
Services under this section shall not include routine care, elective care, planned
procedures, rehabilitation unrelated to emergency stabilization, fertility services, long
term services and supports, organ transplantation, outpatient pharmaceuticals beyond what is
necessary to complete emergency stabilization, or any other non emergency benefit as
determined by the Secretary.
(4)Emergency medical condition.
In this section, the term emergency medical condition means a condition manifesting itself
by acute symptoms of sufficient severity, including severe pain, such that the absence of
immediate medical attention could reasonably be expected to result in serious jeopardy to
health, serious impairment of bodily functions, or serious dysfunction of any bodily organ
or part.
(d)Eligibility and time limits.
(1)members.
An agreement may apply only to a member who is temporarily present in a partner country
for not more than 60 consecutive days, or such shorter period as the Secretary may establish
by regulation to prevent abuse. The Secretary may require a member to activate a travel
credential under subsection (e) before coverage under an agreement applies.
(2)Eligible visitors.
An agreement may apply only to a person who is temporarily present in the United States, is
not a member, and is verified as eligible under the partner country's coverage
mechanism. The Secretary may require verification of lawful admission for a temporary stay
and may exclude categories of persons whose travel is primarily for obtaining medical care,
as determined by the Secretary.
(e)Verification tools and records.
(1)Member travel credential.
The Secretary shall provide a standardized electronic travel eligibility credential for System
members to present to a participating provider or designated point of care in a partner
country. The credential shall be designed for rapid verification, shall disclose only
minimum necessary eligibility information, and shall be revocable.
(2)Reciprocal Visitor Eligibility Record.
The Secretary shall establish a Reciprocal Visitor Eligibility Record that allows
participating providers in the United States to verify whether a person is an eligible
visitor for purposes of an agreement under this section. The record shall not create System
membership. The record shall be limited to identity and eligibility fields necessary to
verify eligibility and support settlement, including name, date of birth, nationality, a
travel document identifier, dates of temporary presence, a partner coverage eligibility
token, and any settlement routing identifier, as determined by the Secretary. The record
shall not include a clinical history beyond information necessary to document the emergency
episode and support payment integrity.
(3)Privacy and auditability.
Verification under this subsection shall be subject to identity proofing, minimum necessary
standards, and audit logging consistent with section 303F. Information created or received
under this section may not be used for marketing or other non health purposes and may not be
used for immigration enforcement.
(f)Payment, settlement, and cost sharing.
(1)members.
The Secretary shall establish payment and settlement methods for covered services furnished
to members under an agreement, including claim submission, verification, exchange
rates, and anti fraud controls. Any point of service cost sharing imposed on a member
for services under this section shall be subject to section 204 and shall not delay
emergency care.
(2)Eligible visitors.
The Secretary shall seek reimbursement from the partner country or its designated coverage
entity for emergency services furnished to eligible visitors in the United States under this
section, under the terms of the agreement. To the extent reimbursement is not recovered, the
System shall reimburse participating providers through the Safety Net Care Fund under sections
601 and 602. Nothing in this paragraph requires the Secretary to provide coverage for non
emergency services to eligible visitors.
(g)Anti abuse safeguards.
The Secretary shall implement safeguards to prevent exploitation, including limits on repeat
usage, pre travel activation requirements for members, documentation standards for emergency
determinations, targeted audits for high cost claims, and recoupment authority for improper
payments.
(h)Reporting.
Not later than 1 year after the first agreement under this section takes effect, and
annually thereafter, the Secretary shall submit to Congress a report describing
participating partner countries, utilization, costs, reimbursements recovered, fraud
findings, and any recommended statutory changes.
(i)Rule of construction.
Nothing in this section shall be construed to establish an entitlement to routine care
outside the United States, to expand benefits for non members beyond emergency and public
health services already required under title VI, or to limit any stricter confidentiality
protections under Federal or State law.
SEC. 304.CONTINUITY OF COVERAGE.
(a)Independence from employment. System membership shall not terminate or change solely
because a member gains or loses employment, changes employers, or changes hours.
(b)Independence from residence within United States. System membership shall remain in force
when a member moves from one State to another within the United States.
TITLE IV. PROVIDER PARTICIPATION, PAYMENT, AND PRESCRIPTION DRUG PRICING.
TITLE IV—PROVIDER PARTICIPATION, PAYMENT, AND PRESCRIPTION DRUG PRICING.
SEC. 401.PARTICIPATION AGREEMENTS.
(a)Requirement. A provider that seeks payment from the System shall enter into a participation
agreement with the Secretary.
(b)Terms. The agreement shall require the provider to
(1)accept System payment as payment in full for essential health services, subject to authorized
copayments,
(2)comply with System billing standards and data reporting requirements,
(3)comply with nondiscrimination and access standards, and
(4)cooperate with audits and fraud control activities.
(c)Prohibition on excess charges.
(1)In general. No provider, whether participating in the System or not, may
charge or collect from a member an amount for an essential health
service that exceeds the payment rate established under section 402 for
that service.
(2)Penalty. Any violation of paragraph (1) shall result in a civil monetary
penalty equal to 3 times the amount of the excess charge, in addition to
any other remedies available under Federal or State law.
SEC. 402.UNIVERSAL ALL PAYER PAYMENT METHODOLOGIES AND RATE SETTING.
(a)Establishment of Universal Rate Schedule.
(1)In general. The Secretary shall establish and maintain a Universal Rate Schedule for essential health services furnished to members. The Universal Rate Schedule shall specify payment rates and payment methodologies and shall apply on an all payer basis as provided in subsection (b).
(2)Commission. The Secretary shall establish a Federal All Payer Rate Commission to advise and support the Universal Rate Schedule, including technical updates, data analysis, and public transparency, under standards prescribed by the Secretary.
(3)Membership and independence.
(A)Membership. The Commission shall include not fewer than 11 members with expertise in payment policy, hospital finance, physician payment, rural access, pharmacy economics, data science, and consumer protection.
(B)Appointments and terms. Members shall be appointed by the Secretary for staggered terms. The Secretary shall adopt conflict of interest and recusal rules that prevent capture by any payer, provider, vendor, or manufacturer stakeholder.
(C)Meetings. The Commission shall meet regularly and shall conduct public meetings.
(4)Public process.
(A)Proposed updates. Not later than 90 days before a material update takes effect, the Secretary shall publish proposed rate updates and methodologies.
(B)Hearings and comment. The Secretary shall provide for public hearings and a public comment period of not fewer than 60 days.
(C)Finalization. The Secretary shall publish final updates not later than 30 days before the effective date, except for emergency updates necessary to protect access.
(5)State partnership option. The Secretary may approve State all payer payment programs, including hospital global budget models, that meet or exceed Federal standards for transparency, access, and cost governance. An approved State program shall be treated as satisfying the Universal Rate Schedule for services furnished in the State to members, to the extent specified by the Secretary.
(b)All payer binding effect.
(1)In general. For essential health services furnished to members, every certified plan, the Federal Standard Plan, and any subcontractor acting on behalf of such plans shall pay participating providers only in accordance with the Universal Rate Schedule. A participating provider shall accept the applicable rate as payment in full and may not balance bill the member, except for cost sharing expressly authorized under section 204.
(2)No negotiation. Rates under the Universal Rate Schedule may not be modified by private contract, side letter, or other agreement between a payer and a provider, except as expressly authorized by the Secretary for standardized value based adjustments that are uniform and publicly specified.
(c)Methods. The Universal Rate Schedule may pay providers using fee schedules, bundled payments, episode based payments, global budgets, capitation, or other methods that support access, quality, and cost control, provided that such methods are transparent and auditable.
(d)Rate setting considerations. In establishing and updating rates and methodologies, the Secretary shall consider:
(1)the reasonable costs of efficient providers;
(2)the need to maintain access in rural, frontier, and underserved areas;
(3)the need to preserve essential service lines and standby capacity; and
(4)the overall financial condition of the Trust Fund and the cost governance targets under section 206.
(e)Minimum payment floors.
(1)In general. For essential health services furnished on or after the main implementation date, the Secretary shall set national base rates that are not less than 100 percent of the corresponding Medicare payment amounts for the same or comparable services, as determined by the Secretary, subject to geographic and access adjustments under subsection (f).
(2)Site neutrality. The Secretary shall ensure that payment rates for essential health services are consistent across sites of service. A service provided in a hospital outpatient department shall be paid at the same rate as the same service provided in a physician office or freestanding clinic, unless the Secretary determines that clinical acuity requires a higher facility component.
(f)Rural, frontier, Alaska, and essential access stability.
(1)Geographic input adjustments. The Secretary shall apply objective geographic input cost adjustments based on wages and other input costs, under a transparent methodology.
(2)Standby capacity and low volume add ons. The Secretary shall establish formula based add on payments to preserve essential service lines that must exist notwithstanding low volume, including emergency and trauma capability, maternity and newborn capability, critical access facilities, and essential specialty access.
(3)Frontier and non contiguous logistics factor. The Secretary shall establish a narrowly defined logistics factor for frontier areas and non contiguous jurisdictions, including Alaska, tied to objective measures of transport distance, weather related access constraints, and supply chain costs. The logistics factor shall be capped and reviewed annually.
(4)Anti blank check rule. Any add on payment under this subsection shall be prospective, formula based, capped, and subject to scheduled re evaluation. The Secretary shall publish an annual justification report for such add ons.
(g)Aeromedical payment methodology and anti gouging safeguards.
(1)National methodology. Not later than 18 months after the date of enactment, the Secretary shall establish a national payment methodology for aeromedical transport and medevac covered under section 104(a)(3A).
(2)Documentation and medical necessity. The methodology shall include medical necessity standards and dispatch documentation standards sufficient to prevent unnecessary flights and improper billing.
(3)Outlier controls, audits, and recoupment. The Secretary shall implement outlier controls, audit authority, and recoupment authority for improper billing, including billing not supported by documentation required under paragraph (2).
(h)Transparency. The Secretary shall publish the Universal Rate Schedule and material updates in a manner that is accessible to the public, and shall provide machine readable files for rates and methodologies.
(i)Rule of construction. Nothing in this section shall be construed to preclude States from operating additional State level all payer oversight mechanisms for non member populations or for services not covered under the essential benefit floor, provided that such mechanisms do not conflict with the Universal Rate Schedule as applied to members.
(j)Annual update limit and sustainability.
(1)In general. The Secretary shall update the Universal Rate Schedule in a manner consistent with section 206. The aggregate update factor for covered services may not exceed the growth in nominal gross domestic product per capita plus 0.5 percentage points for the applicable period, unless the Secretary determines that a temporary deviation is necessary to prevent a material access failure.
(2)Automatic correction. If the Secretary determines that System spending is exceeding cost governance targets under section 206, the Secretary shall implement automatic corrective updates in the next rate cycle, including reduced update factors, tightened outlier parameters, and expanded site neutrality.
(k)Hospital payment frameworks and global budgets.
(1)In general. The Secretary may establish hospital global budgets, prospective budgets, or other facility payment frameworks for participating hospitals. Such frameworks may incorporate annual budget targets, quality requirements, and access protections.
(2)State models. Approved State all payer programs under subsection (a)(5) may implement hospital global budgets or rate setting methods that are consistent with Federal targets and member protections.
(3)Rural protections. Any global budget framework shall include formula based protections for rural and frontier facilities to preserve essential service lines and standby capacity, subject to subsection (f)(4).
(l)Limited appeals.
(1)In general. The Secretary shall establish a limited appeals process for providers and certified plans to correct technical errors in service classification, coding crosswalks, or eligibility for specific add on formulas. Rates themselves are not subject to case by case negotiation or appeal.
(2)Timeliness. Appeals shall be resolved within timeframes that prevent cash flow disruption.
(m)Enforcement and anti circumvention.
(1)Platform enforcement. The National Health Claims Data Platform shall reject or auto correct claims for essential health services that do not conform to the Universal Rate Schedule.
(2)Civil penalties. The Secretary may impose civil monetary penalties on any certified plan, provider, or subcontractor that knowingly attempts to circumvent the Universal Rate Schedule through side payments, rebates, or other devices.
(3)Public reporting. The Secretary shall publish enforcement actions and summary statistics on compliance.
SEC. 402A.WORKERS' COMPENSATION MEDICAL COORDINATION.
(a)Purpose. The purpose of this section is to ensure rapid access to medically necessary care for occupational injuries and illnesses, reduce billing friction, and clarify payer responsibility, while preserving State workers' compensation cash benefit structures and exclusive remedy rules.
(b)Definitions. In this section:
(1)Occupational injury or illness. The term "occupational injury or illness" means an injury or illness arising out of and in the course of employment, as determined under applicable State workers' compensation law.
(2)Workers' compensation entity. The term "workers' compensation entity" means an employer, insurer, self insured plan, or other responsible payer under applicable State workers' compensation law.
(3)Clean claim. The Secretary shall define "clean claim" for purposes of this section.
(4)Prompt payment timeframe. The term "prompt payment timeframe" means the period established by the Secretary that shall not exceed 30 days after receipt of a clean claim.
(c)Two tier framework.
(1)Default rule. Workers' compensation entities remain primary payers for occupational injury or illness medical expenses to the extent payment may reasonably be expected to be made under applicable State workers' compensation law.
(2)Optional State election. A State may elect, under procedures established by the Secretary, to integrate occupational medical coverage with the System under subsection (e), subject to the conditions in that subsection.
(d)Default rule, conditional payments, and recovery.
(1)Conditional payment authority. If a participating provider submits a claim for occupational injury or illness medical services and a workers' compensation entity does not pay within the prompt payment timeframe, the System may make a conditional payment to the provider for covered services to prevent delay of medically necessary care.
(2)Full reimbursement required. Any workers' compensation entity that is responsible for payment shall reimburse the System for the full amount of any conditional payment made by the System under paragraph (1). Reimbursement under this paragraph shall not be limited by any State workers' compensation fee schedule, State payment limitation, contract rate, or other State law limitation.
(3)Interest and administrative recovery fee. A reimbursement under paragraph (2) shall include interest accruing from the date of the conditional payment, and an administrative recovery fee, in amounts and under standards established by the Secretary, designed to ensure that delay is not economically advantageous.
(4)Recovery mechanisms. The United States shall have a right of reimbursement from the responsible workers' compensation entity for any conditional payment made under this section, including recovery through reimbursement demands, offsets, and such other mechanisms as the Secretary establishes.
(5)No double payment. The Secretary shall establish rules to prevent duplicate payment, including claim matching, recovery procedures, and provider billing safeguards.
(6)Provider billing clarity. The Secretary shall establish a simple billing pathway for providers, including standards for when a provider may bill the System after nonpayment within the prompt payment timeframe, and standards for documentation needed to support recovery.
(e)Optional State integration election, System as payer of record.
(1)Election authority. The Secretary may approve a State election under which, for occupational injury or illness medical services that are covered under the System, the System becomes the payer of record for such medical services furnished by participating providers.
(2)Required conditions. The Secretary may approve an election under paragraph (1) only if the Secretary determines that:
(A)the State maintains wage replacement and disability cash benefits under its workers' compensation system,
(B)the State implements an employer side financing mechanism, such as an assessment or equivalent payment obligation, sufficient to prevent net cost shifting of occupational medical expenses to the SAFECARE Trust Fund,
(C)the State provides data and operational cooperation necessary to administer the coordination and prevent fraud and double payment, and
(D)the election includes enforcement and audit authority sufficient to protect the System.
(3)Deposit. Amounts collected under paragraph (2)(B) shall be deposited into the SAFECARE Trust Fund.
(f)Enforcement and repeat offender controls.
(1)Patterns of late payment. The Secretary shall establish standards to identify workers' compensation entities with patterns of failure to pay within the prompt payment timeframe.
(2)Additional remedies. For entities described in paragraph (1), the Secretary may impose increased administrative recovery fees, require periodic reporting, require enhanced verification, and require such other controls as are necessary to protect the System from systematic delay.
(g)Rule of construction.
(1)Cash benefits preserved. Nothing in this section shall be construed to federalize or displace State workers' compensation wage replacement, disability, or death benefits.
(2)Exclusive remedy preserved. Nothing in this section shall be construed to alter State workers' compensation exclusive remedy rules, except to the extent necessary to carry out payment coordination and recovery.
(3)State authority preserved. Nothing in this section limits State authority to define compensability, adjudicate disputes, or regulate workers' compensation entities, except to the extent necessary to carry out an approved integration election under subsection (e).
SEC. 403.UNIFIED BILLING AND PROHIBITION OF SURPRISE BILLING.
(a)Standard billing format. The Secretary shall adopt a single standard electronic billing format
for claims for essential health services.
(b)Surprise billing ban. A provider may not bill a member for amounts above authorized
copayments for covered essential services.
SEC. 404.REDUCTION OF ADMINISTRATIVE BURDEN.
SEC. 404A.AMBIENT CLINICAL DOCUMENTATION SUPPORT.
(a)Purpose. To maximize clinical capacity and reduce administrative burden, the Secretary shall make available approved ambient clinical documentation systems for participating providers.
(b)Approved systems and procurement. The Secretary shall establish a certification and procurement program for ambient clinical documentation systems, including minimum privacy, security, accuracy, and transparency standards. The Secretary shall make approved systems available through federal procurement vehicles and shall reimburse participating primary care practices and other provider categories designated by the Secretary for reasonable implementation and ongoing operating costs, subject to limits established by regulation.
(c)Minimum documentation elements. Documentation produced by an approved ambient system shall be deemed sufficient for payment under section 402 if it contains the minimum required elements established by the Secretary, which shall include, at minimum, the relevant history, assessment, clinical decision making, and plan.
(d)Clinical independence and optional use. Nothing in this section shall be construed to require the use of any specific technology, to require continuous recording, or to alter clinical decision making. A provider may disable ambient capture for sensitive encounters under standards established by the Secretary.
(e)Anti gaming safeguards. The Secretary shall implement safeguards to prevent systematic upcoding, risk score inflation, or fraudulent documentation associated with ambient systems, including audit authority, model performance monitoring, and corrective actions. Use of an approved system does not create any presumption of entitlement to higher coding or payment.
(f)Privacy and security. Approved systems shall comply with requirements established by the Secretary for encryption, access controls, retention limits, patient notice, and incident response. Vendors shall be treated as business associates for purposes of protected health information handling.
SEC. 405.NATIONAL FORMULARY AND STATUTORY PRICE CEILINGS. (a) Establishment. The Secretary shall establish a National Formulary for essential drugs and biologics and shall negotiate reimbursement rates for such drugs, subject to the statutory ceilings in this section.
(b)The "Fair Price" Statutory Ceiling.
(1)Mandatory Cap. Notwithstanding any other provision of law, the maximum reimbursement rate paid by the System for any drug or biologic shall not exceed the lower of:
(A)The Domestic Value Benchmark determined under subsection (c); or
(B)110 percent of the International Reference Price (IRP) determined under subsection (d).
(2)Prohibition. The Secretary shall have no authority to agree to, or reimburse at, a price higher than the cap established in paragraph (1), except as provided in the "Innovation Safety Valve" in subsection (e).
(c)Domestic Value Benchmark.
(1)Definition. The Domestic Value Benchmark is the price that reflects the clinical value of the drug to patients in the United States, as determined by the Secretary.
(2)Methodology. In calculating this benchmark, the Secretary shall use established clinical-effectiveness data (such as Quality-Adjusted Life Years or similar metrics) and shall explicitly exclude costs related to direct-to-consumer advertising and lobbying.
(d)International Reference Price (IRP) Defined.
(1)Formula. For purposes of the statutory cap in subsection (b)(1)(B), the "International Reference Price" is the median ex-factory price, net of all standard rebates, for the drug in the "Reference Countries".
(2)Reference Countries. The Reference Countries are the United Kingdom, France, Germany, Japan, and Canada.
(3)Data Collection. Manufacturers shall report such international pricing data to the Secretary. Failure to report, or material misreporting, shall result in a Civil Monetary Penalty of 10 times the difference between the reported price and the actual price.
(4)Congressional Intent. The use of international data in this subsection is intended solely as a factual input for the statutory formula established by Congress in subsection (b), and does not constitute a delegation of legislative authority to foreign sovereigns.
(e)Innovation Safety Valve (Rebuttable Presumption).
(1)Petition. A manufacturer may petition the Secretary to exceed the cap in subsection (b) only if it demonstrates, by clear and convincing evidence, that the cap would result in a price below the manufacturer’s marginal cost of production and distribution plus a reasonable return on research and development specific to that drug.
(2)Strict Scrutiny. The Secretary shall grant such a petition only if:
(A)The drug represents a significant clinical advance over existing therapies; AND
(B)Denial of the petition would likely lead to a shortage of the drug in the United States.
(3)Transparency. Any decision to exceed the cap must be published in the Federal Register with a detailed economic analysis justifying the exception.
(f)Fall-Back Provision. If the International Reference Price cannot be determined (e.g., for a new drug not yet launched abroad), the Statutory Ceiling shall be the Domestic Value Benchmark until international data becomes available.
(g)Strategic Severability.
(1)Survival of Price Controls. It is the express intent of Congress that the price controls in this section be fully severable.
(2)Automatic Fallback. If the application of the International Reference Price under subsection (b)(1)(B) or subsection (d) is held to be invalid or unconstitutional by a court of competent jurisdiction, the maximum reimbursement rate under subsection (b)(1) shall be determined solely by reference to the Domestic Value Benchmark under subsection (b)(1)(A).
(3)Preservation. In such event, the remainder of this section, including the Secretary’s obligation to negotiate prices below such benchmark, shall remain in full force and effect.
SEC. 406.INTERNATIONAL REGULATORY RECIPROCITY.
(a)Establishment. The Secretary shall establish a Reciprocal Approval Pathway for designated Gold Standard Regulatory Authorities, including the European Medicines Agency, the UK MHRA, the PMDA of Japan, and Swissmedic.
(b)Presumption of safety and efficacy. If a prescription drug or biologic has been approved for marketing by a Gold Standard Regulatory Authority, the Secretary shall treat such approval as prima facie evidence of safety and efficacy.
(c)Expedited review.
(1)Time limit. For a drug or biologic described in subsection (b), the review period for an application submitted to the Food and Drug Administration shall not exceed 90 days.
(2)Scope. The review under paragraph (1) shall focus solely on United States specific labeling and manufacturing supply chain integrity.
(3)Limited exception. The Secretary may require new clinical data only if the Secretary identifies a specific and compelling public health reason to do so and publishes a written determination describing that reason.
SEC. 407.SMALL INNOVATOR SUPPORT PROGRAM.
(a)Fee waiver.
(1)In general. The Secretary shall waive 100 percent of the application fees under the Prescription Drug User Fee Act for any applicant that meets the eligibility criteria in paragraph (2).
(2)Eligibility criteria. An applicant is eligible under this paragraph if the applicant
(A)has fewer than 500 employees,
(B)has no other drug product approved for marketing, and
(C)is submitting an application for a novel therapeutic mechanism.
(b)Application support grants.
(1)In general. The Secretary shall award grants to eligible applicants described in subsection (a) to offset the administrative costs of preparing data for Food and Drug Administration review.
(2)Authorization of appropriations. There is authorized to be appropriated 500,000,000 dollars for each fiscal year to carry out this subsection.
SEC. 408.NATIONAL CLINICAL TRIAL INFRASTRUCTURE.
(a)Purpose. The purpose of this section is to reduce the cost and time of drug development by maintaining standing clinical trial networks.
(b)Network. The Secretary, acting through the National Institutes of Health, shall maintain National Platform Trial networks for high priority conditions, including oncology, neurodegenerative disease, and antimicrobial resistance.
(c)Open access. Any sponsor with a novel drug candidate that passes preclinical toxicology screening may, for a standardized cost recovery fee, enroll the candidate into a National Platform Trial network under subsection (b), utilizing the network's existing patient cohorts and data infrastructure.
TITLE V. HEALTH WORKFORCE AND EDUCATION REFORM.
TITLE V—HEALTH WORKFORCE AND EDUCATION REFORM.
SEC. 409.PHARMACY BENEFIT MANAGER TRANSPARENCY AND DELINKING.
(a)Definitions. In this section.
(1)Pharmacy benefit manager. The term ‘pharmacy benefit manager’ means any entity that administers or manages prescription drug benefits, including formulary design, network contracting, utilization management, or claims processing, for the System.
(2)Price concessions. The term ‘price concessions’ includes rebates, discounts, fees, administrative payments, data fees, formulary placement fees, and any other remuneration from a manufacturer or affiliate that is related to drug placement, utilization, or payment.
(b)Mandatory delinking. No pharmacy benefit manager under a contract with the System may receive compensation that is directly or indirectly based on list price, wholesale acquisition cost, or any benchmark derived from such amounts, except as specifically authorized by the Secretary for a fixed, disclosed, non percentage administrative fee.
(c)Allowed compensation model. The Secretary shall structure PBM compensation using fixed per claim administrative fees and, where appropriate, fixed performance fees tied to measurable outcomes, in a manner that eliminates incentives to increase list prices.
(d)One hundred percent pass through to the Trust Fund. All price concessions negotiated or received by a pharmacy benefit manager or its affiliates in connection with System covered drugs shall be passed through one hundred percent to the SAFECARE Trust Fund in the manner specified by the Secretary.
(e)Ban on spread pricing. A pharmacy benefit manager may not charge the System more for a drug than the total amount paid to the dispensing pharmacy for the drug, including any dispensing fee, and shall disclose such amounts in a form specified by the Secretary.
(f)Anti steering and network fairness. The Secretary shall prohibit contract terms that unreasonably steer patients to PBM owned or affiliated pharmacies where a comparable alternative is available, and shall establish fair network access standards for independent pharmacies.
(g)Transparency and audit. The Secretary shall require PBMs to provide machine readable reporting on net prices, all price concessions, all fees, pharmacy reimbursement amounts, and any affiliated transactions. The Secretary may audit PBMs and impose payment withholds, civil monetary penalties, or contract termination for violations.
(h)Rule of construction. Nothing in this section limits the Secretary’s authority to procure drugs directly or to establish alternative pharmacy administration models.
SEC. 410.MEDICAL DEVICE RIGHT TO REPAIR AND INTEROPERABILITY.
(a)Parts, manuals, diagnostic access, and parts availability.
(1)Condition of reimbursement. As a condition of reimbursement under this Act for use of a medical device by a participating facility, the device manufacturer shall make available to participating facilities, on fair and reasonable terms, access to diagnostic software tools, service documentation, repair manuals, and replacement parts that are materially equivalent to those provided to authorized repair providers.
(2)Qualified repair. The Secretary shall establish standards for qualified in house and third party repair, including safety, cybersecurity, and documentation requirements.
(3)Parts availability parity. As a condition of reimbursement under this Act, a manufacturer shall make available to participating facilities and qualified repair providers the same replacement parts, subassemblies, and consumables that the manufacturer makes available to its own authorized repair providers, on fair and reasonable terms.
(4)Parts catalog and SKU level disclosure. A manufacturer shall maintain and provide, in a form specified by the Secretary, a SKU level parts catalog for covered devices, including part numbers, compatibility, and ordering information, sufficient to enable lawful repair under this section.
(5)Pricing reasonableness. For purposes of this section, “fair and reasonable terms” includes pricing not materially higher than the price charged to authorized repair providers for the same part, adjusted for volume, as determined by the Secretary.
(6)Anti bundling and anti assembly only restrictions.
(A)In general. A manufacturer may not satisfy the requirements of paragraphs (1) through (5) solely by offering a higher level assembly when a lower level replacement part or subassembly is necessary and sufficient to restore the device to safe and functional operation.
(B)No forced block purchases. A manufacturer may not require the purchase of an entire system or major assembly as a condition of obtaining a component part, diagnostic tool, service documentation, or firmware necessary for repair.
(7)Safety and cybersecurity exception, narrowly tailored.
(A)Exception. A manufacturer may restrict sale of a specific component part only if the manufacturer demonstrates to the Secretary that unrestricted sale of that part would create a material and specific risk to patient safety or cybersecurity that cannot be mitigated through qualification standards under paragraph (2).
(B)Least restrictive alternative. If the Secretary approves a restriction under subparagraph (A), the manufacturer shall provide a least restrictive alternative, including availability to qualified repair providers, and shall publish a clear written justification and mitigation requirements in a form specified by the Secretary.
(b)Software restrictions.
(1)Anti lock abuse. A manufacturer may not use digital locks, firmware restrictions, contractual terms, or technical measures primarily to prevent lawful repair by a participating facility or a qualified repair provider acting under subsection (a)(2).
(2)Security permitted. Nothing in this subsection prohibits reasonable authentication, security controls, or safety measures narrowly tailored to protect patients and systems, provided such controls are not used to deny parts, manuals, or diagnostic access required under subsection (a).
(c)Interoperability.
(1)Standard outputs. The Secretary shall require that covered devices provide standard, non proprietary data output formats and interfaces necessary for clinical operations, safety monitoring, and claims and quality reporting under this Act.
(2)Standards designation. The Secretary may designate widely adopted consensus standards for interoperability and may update such designations by regulation.
(d)Warranty and liability.
(1)Warranty neutrality. Nothing in this section requires a manufacturer to warrant repairs performed by a party other than the manufacturer or an authorized repair provider, provided the manufacturer’s warranty terms are clearly disclosed.
(2)No liability shift. Nothing in this section shifts liability for negligent repair from the party performing the repair.
(e)Qualified repair provider integrity and anti abuse controls. The Secretary shall include in the standards under subsection (a)(2) requirements sufficient to prevent abuse and ensure accountability, including requirements addressing the following.
(1)Prime accountability and subcontracting limits. A qualified repair provider must be identified as the prime responsible entity for each repair. Subcontracting is permitted only with prior written approval of the participating facility and only to one additional tier. The prime remains fully responsible for compliance, documentation, cybersecurity servicing standards, and quality outcomes.
(2)Credential controls. Diagnostic access credentials must be issued to identified entities and users, must be nontransferable, and must be subject to audit logging. Knowingly sharing credentials outside the authorized repair scope is grounds for decertification and penalties.
(3)Parts traceability. Qualified repair providers must maintain chain of custody and traceability records for replacement parts and software images, including lot or serial identifiers where available, and must certify that parts are not counterfeit or stolen.
(4)Data minimization and non retention. Qualified repair providers may access only the minimum device data necessary to diagnose and repair the device and must comply with Secretary cybersecurity and confidentiality standards, including secure wipe and non retention requirements.
(5)Financial responsibility. The Secretary shall require qualified repair providers to maintain minimum insurance coverage and, where appropriate, bonding sufficient to cover foreseeable harms arising from negligent repair.
(6)Anti kickback and referral fee ban. The Secretary shall prohibit referral fees, remuneration, or other financial inducements tied to repair volume or steering, and shall require disclosure of ownership and affiliate relationships.
(7)No unrelated subscription conditioning. A manufacturer or repair provider may not condition access to parts, manuals, diagnostics, interoperability, or repair eligibility on purchase of unrelated service subscriptions, except for security update services that are reasonably necessary and offered on fair and reasonable terms.
(f)Enforcement. The Secretary may enforce this section through participation conditions, payment withholds, civil monetary penalties, exclusion of a noncompliant device model from reimbursement eligibility under this Act, and contract remedies, as specified by regulation.
(g)No critical infrastructure carveout by label.
(1)No label based exemption. The fact that a device, component, software, or system is used in, connected to, marketed for, procured for, or associated with any critical infrastructure sector, public safety function, emergency response function, national security function, or similar category, whether designated by the manufacturer or any third party, shall not, by itself, authorize any restriction, limitation, or exemption from this section.
(2)No self designation. A manufacturer may not rely on a unilateral designation, contract term, policy statement, end user license agreement, warranty condition, or marketing claim to create any restriction under this section.
(3)Federal coordination rule of construction. Nothing in this subsection shall be construed to limit the independent statutory authorities of any Federal department or agency. For purposes of compliance with this Act and reimbursement eligibility under this Act, any restriction on repair access, parts, tools, diagnostics, firmware, calibration, interoperability, or service access must satisfy subsection (h).
(h)Evidentiary burden, public record, cost shifting, and time limits for restrictions.
(1)Burden of proof. In any request to restrict parts, tools, software, diagnostics, manuals, firmware, calibration, pairing, interoperability, service access, or repair information under subsection (a)(7) or subsection (b)(2), the manufacturer bears the burden of proof.
(2)Standard. The Secretary may approve a restriction only upon a written determination that the manufacturer has demonstrated, by clear and convincing evidence, that unrestricted access would create a material and specific risk to patient safety or cybersecurity and that such risk cannot be reasonably mitigated through qualified repair standards under subsection (a)(2) and integrity controls under subsection (e), together with the compliant pathway required under subsection (i).
(3)Public docket. The Secretary shall maintain a public docket of restriction requests and determinations. The Secretary shall publish the written justification, the scope of the restriction, the minimum mitigation controls required, and the compliant pathway required under subsection (i). The Secretary may redact only information that constitutes a trade secret and shall redact narrowly.
(4)Petition fee and cost shifting. The Secretary may require a reasonable filing fee for restriction requests, which shall be calibrated to be reasonable and not unduly burdensome, and may require the manufacturer to pay the costs of technical review if the request is denied, withdrawn after notice of deficiency, or determined to contain material omissions or materially misleading representations.
(5)Category determinations and bulk renewals. The Secretary may issue determinations by device class, product family, risk tier, or restriction category, and may renew determinations in bulk when the evidentiary basis remains materially unchanged, provided that the Secretary preserves the standard in paragraph (2) and the public docket requirement in paragraph (3).
(6)Sunset. Any approved restriction shall expire not later than 24 months after approval unless renewed under this subsection based on a new evidentiary showing or a bulk renewal under paragraph (5).
(i)Mandatory compliant pathway for qualified repair.
(1)Access must remain. Any restriction approved under this section must preserve a compliant repair pathway for participating facilities and qualified repair providers.
(2)Minimum elements. The compliant pathway required under paragraph (1) shall include, as applicable
(A)availability of the restricted part, tool, or interface to qualified repair providers,
(B)a secure service mode or controlled access program that enables diagnosis, repair, calibration, restoration, and verification,
(C)documented post repair validation tests and acceptance criteria, and
(D)access to official firmware restore images, recovery procedures, and rollback procedures sufficient to return the device to a known good state.
(3)Security controls preserved. Nothing in this subsection or subsection (j) shall be construed to prohibit reasonable authentication, authorization, cryptographic verification, integrity checks, logging, attestation, or other security controls, provided that such controls preserve a compliant pathway under this subsection for qualified repair providers.
(4)Examples and safe harbors. The Secretary shall, by regulation, publish illustrative examples of compliance and noncompliance with subsections (i) and (j), and may establish safe harbor technical patterns and operational practices that satisfy the requirements of this section.
(j)Anti lockout by design.
(1)Repair access. A manufacturer shall provide a practical means for participating facilities and qualified repair providers to access diagnostic, calibration, restore, and verification functions necessary for lawful repair in a manner consistent with Secretary cybersecurity standards.
(2)Prohibited measures. Technical measures that materially impede lawful repair or that condition lawful repair on the manufacturer’s authorized network, including parts pairing, feature gating, serialized component binding, remote disablement, punitive error states, or degradation of performance after independent repair, constitute a violation of this section unless the manufacturer demonstrates to the Secretary that the measure is narrowly tailored, necessary for a material patient safety or cybersecurity purpose, and implemented with the compliant pathway required under subsection (i).
(3)No warranty or support retaliation. A manufacturer may not void, limit, or condition warranty coverage, support, security updates, patch eligibility, vulnerability response, or licensing on the use of the manufacturer’s authorized repair network.
(k)Contract override void and unenforceable.
Any contract term, end user license agreement term, warranty term, acceptable use policy, license condition, or condition of sale that conflicts with this section, or that purports to waive rights under this section, is void as against public policy and shall be unenforceable.
(l)Repeat offender presumption and enhanced remedies.
(1)Presumption against restrictions. A manufacturer found by the Secretary to have materially violated this section within the prior 5 years shall be presumed ineligible for restriction approval under subsection (h) unless the Secretary finds extraordinary necessity and no feasible mitigation exists.
(2)Enhanced remedies. For a willful or repeated violation, the Secretary shall impose enhanced penalties, including civil monetary penalties, payment withholds, corrective action plans with independent monitoring, and exclusion of the affected model from reimbursement eligibility under this Act.
TITLE V. HEALTH WORKFORCE AND EDUCATION REFORM.
SEC. 501.TUITION CAPS FOR HEALTH PROFESSIONS PROGRAMS.
(a)Condition on Federal participation. Any educational institution that
(1)receives Federal research funds, or
(2)is eligible for Federal student loan programs, or
(3)receives System payments for clinical training
and that offers health professions programs covered by this title, shall comply with tuition caps.
(b)Caps. The Secretary, in consultation with the Secretary of Education, shall set maximum
annual tuition amounts. For example
(1)for medical degree programs leading to MD or DO, a cap of not more than 15,000 dollars per
academic year in 2026 dollars, and
(2)for core nursing and allied health programs, a cap of not more than 10,000 dollars per
academic year in 2026 dollars.
(3)Non-application to non-residents. The tuition caps under this section shall
not apply to students who are not legal residents, as defined in section 4, or
who are studying under a non-immigrant student visa. Institutions may
charge such students market rates.
The caps shall be indexed annually to a health education cost index defined by regulation.
(c)Non compliant institutions. An institution that does not comply with the caps shall be
ineligible for the Federal funds and System payments described in subsection (a), and its students
shall be ineligible for the grant and service scholarship programs under section 502.
(d)Coordination with education support payments. The Secretary shall implement tuition caps
under this section together with the Health Professions Education Support Payments under
section 501A to prevent disruption of training capacity.
(e)Accreditation protection.
(1)Federal financial responsibility. The Secretary shall deem any institution
receiving Health Professions Education Support Payments under section 501A
as having satisfied applicable Federal financial responsibility standards for
purposes of participation in Federal student aid programs, as determined by
the Secretary in consultation with the Secretary of Education.
(2)Accreditor limitation. The Secretary of Education shall prohibit any
accrediting agency recognized by the Department of Education from
withdrawing accreditation solely on the basis of revenue reductions resulting
from compliance with this section.
(f)Domestic priority.
(1)Reservation of seats. As a condition of Federal participation under
subsection (a), not less than 90 percent of the incoming class seats in any
health professions program covered by this title shall be reserved for legal
residents of the United States.
(2)Reporting. Each covered institution shall report annually to the Secretary
and the Secretary of Education the number of incoming seats offered and
filled by legal residents and non-residents, under a methodology specified
by regulation.
SEC. 501A.HEALTH PROFESSIONS EDUCATION SUPPORT PAYMENTS.
(a)In general. The Secretary, in consultation with the Secretary of Education, shall make Health
Professions Education Support Payments to eligible institutions to ensure that tuition caps under
section 501 do not reduce the ability of such institutions to provide high quality education and
clinical training.
(b)Eligible institutions. An institution is eligible if it complies with tuition caps under section
501 and participates in the clinical training and workforce goals of this title.
(c)Amount.
(1)Base formula. The Secretary shall pay an amount equal to the difference between
(A)allowable educational costs per student as determined under regulations, and
(B)capped tuition and mandatory fees collected per student under section 501.
(2)Guardrails. Allowable costs shall exclude excessive executive compensation, non educational
real estate expansion, and unrelated administrative growth as defined by regulation.
(d)Performance conditions. Payments under this section shall be conditioned on measurable
outcomes, including graduation rates, board or licensure pass rates, and placement into priority
specialties or priority service areas.
(e)Anti gaming. The Secretary shall audit institutions for cost inflation and shall reduce or
recoup payments for unreasonable cost growth.
SEC. 502.GRANT AND SERVICE SCHOLARSHIP PROGRAMS.
(a)Grants. The Secretary shall provide grants to eligible students in approved health professions
programs to cover tuition up to the caps and reasonable education related expenses.
(b)Service obligation. As a condition of receiving grants, a student shall agree to serve for a
period of not less than five years and not more than seven years in System covered roles. Priority
shall be given to service in primary care, rural and frontier areas, and underserved urban
communities, and in high need specialties such as psychiatry and emergency medicine.
SEC. 503.WORKFORCE RELIEF LOAN FORGIVENESS PROGRAM.
(a)Establishment. The Secretary shall establish a Workforce Relief Loan Forgiveness Program
to provide forgiveness of qualifying educational loans for existing health professionals.
(b)Amount. For each year of full time qualifying service in designated roles or areas, a
participant shall receive forgiveness of a fixed amount of outstanding principal. For example,
30,000 dollars per year for physicians and 15,000 dollars per year for nurses and allied
professionals, up to a maximum of ten years.
(c)Focus. The Secretary shall focus the Program on professionals with high debt burdens and on
areas with shortages of providers.
(d)Tax treatment. Notwithstanding any other provision of law, the discharge
of any loan liability under this section shall not be included in the gross
income of the participant for purposes of the Internal Revenue Code of 1986.
SEC. 504.PRIORITY SERVICE AREAS AND SPECIALTIES.
SEC. 505.MEDICARE GME CAP REPEAL AND RESIDENCY EXPANSION.
(a)Purpose. The purpose of this section is to remove statutory limitations that restrict the number of Medicare-supported graduate medical education training positions, and to expand training capacity with priority for Priority Service Areas and shortage specialties.
(b)Definitions. In this section:
(1)The term "Priority Service Area" has the meaning given such term in section 504.
(2)The term "shortage specialty" means a specialty designated by the Secretary based on objective access and wait-time metrics, including primary care, general surgery, emergency medicine, psychiatry, obstetrics, anesthesiology, and such other specialties as the Secretary determines.
(c)Repeal of Medicare hospital resident caps.
(1)In general. Notwithstanding any other provision of law, the limitations established under section 1886(h)(4) of the Social Security Act (42 U.S.C. 1395ww(h)(4)), including any hospital-specific full-time equivalent resident limitation based on a base-year resident count, are hereby repealed and shall have no force or effect for cost reporting periods beginning on or after the effective date under subsection (g).
(2)Conforming changes. The Secretary of Health and Human Services shall make such conforming regulatory and administrative changes as are necessary to carry out paragraph (1), including for direct graduate medical education payments and any related resident-count mechanisms.
(d)IME conforming repeal. Section 1886(d)(5)(B) of the Social Security Act (42 U.S.C. 1395ww(d)(5)(B)) is amended so that any indirect medical education adjustment shall not be limited by any hospital-specific resident cap or base-year resident count described in subsection (c).
(e)Expansion incentive for Priority Service Areas and shortage specialties.
(1)Establishment. The Secretary shall establish a Graduate Medical Education Expansion Incentive under the SAFECARE System to support incremental training expansion in Priority Service Areas and shortage specialties.
(2)Targeting. In implementing paragraph (1), the Secretary shall prioritize hospitals, training consortia, and community-based training sites that train residents primarily in Priority Service Areas, and shall prioritize shortage specialties.
(3)Minimum rural share. Not less than 40 percent of amounts expended under this subsection in each fiscal year shall support training that occurs primarily in Priority Service Areas, measured by resident rotation time.
(f)Integrity and anti-gaming.
(1)Baseline. For each hospital, the Secretary shall establish a baseline equal to the average number of filled full-time equivalent residents in the three most recent cost reporting periods ending before enactment, excluding any period the Secretary determines to be abnormal due to emergency declarations or extraordinary disruptions.
(2)Additive requirement. Payments or incentives under subsection (e) shall apply only to net new filled positions above baseline.
(3)Audit and recoupment. The Secretary shall audit resident reporting and may recoup amounts for material misreporting or manipulation of resident counts. Material misreporting may result in civil monetary penalties and exclusion from participation agreements under section 401.
(g)Effective date and implementation.
(1)Regulations. Not later than 180 days after enactment, the Secretary shall issue implementing regulations and program instructions.
(2)Effective date. The amendments made by this section shall apply to cost reporting periods beginning on or after the first day of the first fiscal year that begins at least 12 months after enactment.
(h)Rule of construction. Nothing in this section requires a State to administer a Federal program or to appropriate State funds.
(i)Severability. If any provision of this section or its application is held invalid, the remainder of this section and its application shall not be affected.
SEC. 506.RURAL AND SHORTAGE AREA CLINICIAN VISA RETENTION AND EXTENSION.
(a)Purpose. The purpose of this section is to increase and stabilize the health workforce in Priority Service Areas by providing a clear, service-conditioned, expedited pathway for extensions of stay and continued work authorization for eligible nonimmigrant clinicians.
(b)Definitions. In this section:
(1)The term "Priority Service Area" has the meaning given such term in section 504.
(2)The term "covered clinician" means a physician, resident physician, registered nurse, advanced practice registered nurse (including nurse practitioners), physician assistant, dentist, pharmacist, clinical psychologist, licensed clinical social worker, and such other licensed clinical professionals as the Secretary may designate based on shortage data.
(3)The term "qualifying employer" means a participating provider or facility under this Act, a Federally qualified health center, a rural health clinic, a tribal health organization, or a State or local governmental health entity, that principally furnishes covered clinical services in, or primarily serving, a Priority Service Area.
(c)Immigration and Nationality Act amendment. Section 214 of the Immigration and Nationality Act (8 U.S.C. 1184) is amended by adding at the end the following new subsection:
"(s) Priority Service Area clinician extension.
(1)Eligibility. The Secretary of Homeland Security shall provide an expedited extension of stay and continued employment authorization for an alien who:
(A)is lawfully present in the United States in a nonimmigrant classification that authorizes employment, and
(B)is a covered clinician (as defined by Federal law, including the SAFECARE Act), and
(C)has a bona fide offer of full-time principally clinical employment from a qualifying employer, and
(D)will furnish clinical services primarily in a Priority Service Area for the certification period described in paragraph (2).
(2)Certification. The Secretary of Health and Human Services shall establish a certification process under which a qualifying employer may certify that an individual described in paragraph (1) will furnish full-time principally clinical services primarily in a Priority Service Area for a period of not less than 12 months and not more than 3 years.
(3)Extension and renewal. Upon receipt of a valid certification under paragraph (2), the Secretary of Homeland Security shall grant an extension of stay and employment authorization for the certification period. Extensions may be renewed upon continued qualifying service.
(4)Work authorization continuity. A timely filed renewal request supported by a current or renewal certification shall provide continued employment authorization with the same qualifying employer until final adjudication, under conditions set by regulation, to prevent service interruption in Priority Service Areas.
(5)Portability. An individual granted an extension under this subsection may change employers without loss of eligibility if the new employer is a qualifying employer and obtains a certification before the individual begins employment.
(6)Dependents. The spouse and dependent children of an individual granted an extension under this subsection shall receive corresponding extensions of status.
(7)Integrity. The Secretaries may audit certifications. Knowing material misrepresentation shall be grounds for revocation of certification, denial of benefit, civil penalties, and debarment of an employer from participation under the SAFECARE Act, under procedures providing notice and an opportunity to respond.
(8)Rules of construction. Nothing in this subsection:
(A)creates a right to admission or to any immigration benefit for any alien not otherwise eligible under this Act,
(B)preempts State professional licensure requirements, or
(C)requires any State to administer a Federal program."
(d)Regulations. Not later than 180 days after enactment, the Secretary of Homeland Security, the Secretary of Health and Human Services, and the Secretary of Labor shall issue such regulations as are necessary to carry out this section.
(e)Severability. If any provision of this section or its application is held invalid, the remainder of this section and its application shall not be affected.
TITLE VI. NON MEMBER CARE AND SAFETY NET.
TITLE VI—NON MEMBER CARE AND SAFETY NET.
SEC. 507.PRIORITY SERVICE AREA NURSE AND ADVANCED PRACTICE NURSE FAST-TRACK; WORK AUTHORIZATION CONTINUITY; PORTABILITY.
(a)Purpose. The purpose of this section is to increase and stabilize the nursing workforce in Priority Service Areas by providing mandatory expedited processing, continuity of employment authorization, and portability protections for foreign registered nurses and advanced practice registered nurses who serve in such areas.
(b)Definitions. In this section:
(1)Priority Service Area. The term “Priority Service Area” has the meaning given such term in section 504.
(2)Registered nurse. The term “registered nurse” means an individual who meets the definition of a professional nurse for purposes of section 212(a)(5)(C) of the Immigration and Nationality Act and applicable regulations.
(3)Advanced practice registered nurse. The term “advanced practice registered nurse” means an individual licensed as an advanced practice registered nurse, including a nurse practitioner, certified nurse midwife, clinical nurse specialist, or certified registered nurse anesthetist, under the law of a State.
(4)Qualifying employer. The term “qualifying employer” means a participating provider entity, hospital, clinic, health center, or tribal health organization, as defined by the Secretary, that employs a registered nurse or advanced practice registered nurse to furnish clinical services primarily in a Priority Service Area.
(5)Schedule A nurse petition. The term “Schedule A nurse petition” means an employment-based immigrant petition filed for a registered nurse or advanced practice registered nurse under Department of Labor Schedule A procedures.
(c)Immigration and Nationality Act amendments.
(1)Mandatory expedited adjudication. Section 286(u) of the Immigration and Nationality Act (8 U.S.C. 1356(u)) is amended by adding at the end the following:
“(7) Priority Service Area nurses. The Secretary of Homeland Security shall provide mandatory expedited processing, under timeframes set by regulation, for any Schedule A nurse petition and any associated application for extension or change of status filed by a registered nurse or advanced practice registered nurse if the petition is supported by a certification described in paragraph (2).”
(2)Certification of qualifying service. The Secretary shall establish a certification process under which a qualifying employer may request certification that a registered nurse or advanced practice registered nurse will furnish full-time clinical services primarily in a Priority Service Area for a certification period.
(3)Work authorization continuity while pending. The Secretary of Homeland Security shall provide by regulation that a registered nurse or advanced practice registered nurse who files a timely renewal or extension request supported by a current certification under paragraph (2) may continue employment with the same qualifying employer until final adjudication, subject to reasonable integrity conditions.
(4)Portability within Priority Service Areas. A registered nurse or advanced practice registered nurse who is the beneficiary of a Schedule A nurse petition supported by a certification under paragraph (2) may change to a different qualifying employer without loss of eligibility if the new employer obtains a certification before the nurse begins employment and the nurse continues to furnish services primarily in a Priority Service Area.
(d)Integrity and guardrails.
(1)Attestation. A certification request under subsection (c)(2) shall include attestations, under penalty of perjury, that the position is full-time, principally clinical, and located primarily in a Priority Service Area.
(2)Wage and working condition protection. The Secretary of Labor shall set standards to ensure wages and working conditions are not less than those offered to similarly employed nurses in the area.
(3)Audits and penalties. The Secretary may audit certifications and may impose recoupment, civil monetary penalties, and debarment from participation agreements under section 401 for material misrepresentation or systemic noncompliance.
(e)No State mandate. Nothing in this section requires a State to administer any Federal program or to appropriate State funds.
(f)Severability. If any provision of this section or its application is held invalid, the remainder of this section and its application shall not be affected.
TITLE VI. NON MEMBER CARE AND SAFETY NET.
SEC. 601.SAFETY NET CARE FUND.
(a)Establishment. Within the Trust Fund there is established an account to be known as the
Safety Net Care Fund.
(b)Use. The Safety Net Care Fund shall be used to reimburse providers for services described in
sections 602 and 603.
(c)Transitional stop-loss payments.
(1)Authority. During the first 5 years of System operations, the Secretary shall make quarterly
stop-loss payments to Tier 1 Safety Net Hospitals, as designated by the Secretary under
regulations.
(2)Trigger. A stop-loss payment shall be made if the facility demonstrates that System revenues
under title IV are insufficient to cover the direct costs of providing emergency, trauma, burn, or
neonatal intensive care.
(3)Condition. As a condition of receipt, the facility shall submit a corrective action plan to
improve operational efficiency without cutting clinical staff.
SEC. 602.EMERGENCY, MATERNITY, CONTAGIOUS DISEASE, AND LIMITED
(a)Required services. Hospitals and other designated providers shall furnish to any person
physically present in the United States, regardless of status or ability to pay,
(1)emergency stabilizing care,
(2)essential maternity and newborn care,
(3)diagnosis and treatment of serious contagious diseases, and
(4)limited public health primary care, including screening, vaccination, and outpatient diagnosis
and treatment for communicable diseases of public health concern and related primary care
services necessary to prevent transmission, as defined by the Secretary.
(b)Reimbursement. The System shall reimburse providers for such services through the Safety Net
Care Fund at rates established by the Secretary.
SEC. 603.SAFECARE BRIDGE OPTION.
(a)Bridge coverage. The Secretary may establish a Bridge tier of limited coverage that allows
certain long term non citizens, including some non members with at least five years of proven
residence and tax compliance, to buy into or receive subsidized coverage that is less than full
System membership but that includes preventive and primary care.
(b)Firewall. Health data gathered under the System and the Bridge option shall not be shared with
immigration enforcement authorities, except as ordered by a court for a criminal investigation
unrelated to civil immigration violations.
(c)Clarification. Nothing in this section shall be construed to limit required services under
section 602(a)(4).
SEC. 604.ESSENTIAL INFRASTRUCTURE CAPITAL GRANTS.
(a)Establishment. The Secretary shall establish a Capital Grant Program to fund facility
modernization and medical technology acquisition.
(b)Funding structure.
(1)Sustainment block grants. For each fiscal year, the Secretary shall distribute 50 percent
of amounts authorized under subsection (d) via formula to participating hospitals for routine
facility maintenance, IT security upgrades, and replacement of clinical equipment at end of
life.
(2)Strategic innovation grants. For each fiscal year, the Secretary shall distribute 50 percent
of amounts authorized under subsection (d) via competitive grants for
(A)acquisition of advanced medical technology, including robotic surgery systems and
advanced imaging,
(B)construction of new clinical capacity in underserved areas, including behavioral health
and emergency capacity, and
(C)telehealth infrastructure modernization and related secure clinical networking.
(c)Prohibition on non clinical spend. Grant funds shall strictly exclude spending on executive
administration buildings, marketing assets, atriums, or aesthetic landscaping.
(d)Funding. There are authorized to be appropriated from the Trust Fund 100,000,000,000
dollars for each fiscal year to carry out this section. Such amount shall be indexed annually to
the Producer Price Index for construction, as published by the Bureau of Labor Statistics,
under a methodology specified by the Secretary.
(e)Regional capacity review. Prior to awarding a Strategic Innovation Grant exceeding
10,000,000 dollars, the Secretary shall certify that the investment addresses a documented
gap in regional clinical capacity and does not create duplicative supply of services
already adequately available in the service area.
(f)Frontier and Alaska priority and minimum allocation.
(1)Frontier minimum allocation. For each fiscal year, not less than 1 percent
of total amounts authorized under subsection (d) shall be awarded to
participating facilities located in Frontier States or primarily serving
frontier areas, under criteria established by the Secretary.
(2)Alaska floor. Of the amount reserved under paragraph (1), not less than 25
percent shall be awarded to participating facilities and projects located in the
State of Alaska.
(3)Telehealth priority. In awarding grants under subsection (b)(2)(C), the
Secretary shall give priority to projects that expand reliable clinical
connectivity in frontier areas, including remote and tribal communities.
SEC. 605.NATIONAL HEALTH SURGE RESERVE AND EMERGENCY PROCUREMENT AUTHORITY.
(a)Establishment. The Secretary shall establish and maintain a National Health Surge Reserve to ensure continuity of care during declared emergencies by procuring, stockpiling, and rapidly deploying critical medical supplies, devices, pharmaceuticals, diagnostics, and other items necessary to sustain essential clinical operations.
(b)Triggering declarations. The authorities in this section may be activated upon any of the following, as determined by the Secretary:
(1)a declaration of a public health emergency under section 319 of the Public Health Service Act;
(2)a declaration of a major disaster or emergency under the Stafford Act; or
(3)a declaration of a national emergency under the National Emergencies Act that implicates health system continuity.
(c)Covered items and services. The Secretary shall, by regulation, define categories of covered items and services eligible for procurement, stockpiling, and deployment under this section, including personal protective equipment, ventilators and respiratory support supplies, critical imaging and monitoring consumables, essential medications and antidotes, biologics, dialysis consumables, sterilization supplies, and laboratory and diagnostic inputs.
(d)Emergency procurement and contracting.
(1)Rapid procurement. During an activation under subsection (b), the Secretary may enter into contracts, framework agreements, and other procurement vehicles for covered items and services, including advance purchase commitments and surge manufacturing capacity agreements.
(2)Priority performance. The Secretary may include priority performance terms and accelerated delivery requirements in contracts supported by this section, consistent with applicable procurement law.
(3)Domestic resilience. The Secretary shall prioritize domestic manufacturing and diversified regional supply chains for covered items where practicable and cost effective, and may maintain reserve production capacity through retainer style contracts.
(e)Allocation and distribution.
(1)Deployment. During an activation under subsection (b), the Secretary may deploy covered items from the Reserve to participating facilities and other designated sites based on objective need, including patient volume, acuity, supply depletion, and regional outbreak conditions.
(2)Conditions of receipt. As a condition of receiving Reserve items, recipients shall comply with inventory controls, anti diversion requirements, and reporting requirements established by the Secretary.
(3)No private hoarding through System channels. The Secretary may condition participation agreements and relevant contracts to prohibit diversion, resale, or price gouging involving Reserve items or items procured under subsection (d).
(f)Funding and cap suspension, limited to emergencies.
(1)Emergency limitation. Notwithstanding section 207 or any general fund cap provision of this Act, during an activation under subsection (b) the Secretary may obligate amounts necessary to procure and deploy covered items under this section.
(2)Scope. The authority in paragraph (1) applies only to obligations directly attributable to the National Health Surge Reserve and expires as provided in subsection (g).
(3)Reporting. Within 30 days of any activation, and every 60 days thereafter while active, the Secretary shall submit to Congress a report describing obligations, categories of items procured, deployment metrics, and inventory levels, in a form that protects sensitive procurement information.
(g)Automatic sunset and reversion.
(1)Expiration. The emergency cap suspension authority under subsection (f)(1) shall terminate on the earlier of:
(A)180 days after the end of the declaration described in subsection (b); or
(B)540 days after activation, unless extended by Act of Congress.
(2)Reversion. Upon termination under paragraph (1), all further obligations for this section shall be subject to the applicable caps and budget rules otherwise in effect under this Act.
(h)Oversight and program integrity.
(1)Audit. The Inspector General shall have authority to audit procurements, inventories, and deployments under this section.
(2)Remedies. The Secretary may impose recoupment, civil monetary penalties, contract termination, and participation sanctions for fraud, diversion, or material noncompliance involving Reserve items.
(3)Coordination. The Secretary shall coordinate surge reserve activities with relevant Federal partners, including FEMA and other health security functions, to avoid duplication and maximize interoperability.
(i)Rule of construction, no commandeering. Nothing in this section shall be construed to require any State, political subdivision, or non federal entity to administer, enforce, or carry out a Federal regulatory program. The authorities in this section are exercised through Federal procurement, Federal distribution, and voluntary participation conditions under this Act.
SEC. 606.RURAL HEALTH SURGE CAPACITY PROGRAM.
(a)Establishment. The Secretary shall establish, in coordination with the Secretary of Defense and the Governors of the States, a program to be known as the Rural Health Surge Capacity Program (in this section referred to as the Program) to provide temporary supplemental clinical capacity in rural and frontier areas that do not meet the readiness standards under section 303C.
(b)Use of National Guard, reserve, and Department of Defense assets.
(1)In general. Under the Program, the Secretary may, upon request of a Governor or upon joint determination with a Governor, arrange for the deployment of National Guard health personnel serving under title 32, United States Code, and may request support from members of the reserve components of the Armed Forces and other Department of Defense medical assets, in accordance with applicable law, to furnish essential health services in rural and frontier areas.
(2)State control of National Guard. Nothing in this section shall be construed to alter the command authority of a Governor over members of the National Guard serving under title 32, United States Code.
(3)Federal control of Federal forces. Nothing in this section shall be construed to alter Federal command and control over any personnel or assets operating under Federal status.
(c)Scope of services and limitations.
(1)Covered services. Personnel and assets deployed under the Program may furnish only
(A)primary care, urgent care, and emergency stabilization services,
(B)behavioral health and substance use disorder services, and
(C)other essential health services that the Secretary determines are necessary to remedy a documented access gap under section 303C.
(2)Temporary deployments. Deployments under the Program
(A)shall be time limited and ordinarily shall not exceed 90 days for any single deployment period, and
(B)may be renewed only upon a finding by the Secretary that the affected area continues to fail to meet the readiness standards under section 303C and that no feasible civilian alternative is available in the short term.
(3)Non displacement of civilian providers. The Secretary shall implement safeguards to ensure that deployments under the Program do not displace existing civilian providers, including by prioritizing locations with documented workforce shortages, by requiring a written finding that the deployment is supplemental and responsive to a documented readiness failure or vacancy, and by consulting affected providers and facilities.
(4)Capacity ceiling. Except during a declared emergency under section 605(b), the Secretary shall manage the Program so that deployments of National Guard health personnel under this section do not exceed 5 percent of annual National Guard health personnel capacity, measured under metrics specified by the Secretary.
(d)Activation triggers.
(1)Dashboard trigger. The Secretary may activate the Program for a rural or frontier area if the public dashboard under section 303A(e) indicates that the area has failed to meet one or more readiness standards under section 303C for a continuous period of at least 30 days.
(2)Governor request. A Governor may request activation of the Program for one or more areas within the State, subject to criteria and procedures established by the Secretary.
(3)Priority. In administering this subsection, the Secretary shall prioritize frontier areas, including those within Frontier States as defined in section 4.
(e)Payment and coordination.
(1)Rates and payment mechanics. Essential health services furnished to members under the Program shall be paid at amounts not exceeding the Universal Rate Schedule under section 402, through billing and reimbursement mechanisms specified by the Secretary. The Secretary may require that claims for such services be submitted through a sponsoring participating facility or clinic, or through another mechanism that preserves standardized claims integrity and auditability.
(2)Trust Fund financing. Payments for services furnished under the Program shall be made from the SAFECARE Trust Fund and shall be treated as System outlays for covered essential health services.
(3)Coordination with National Health Surge Reserve. The Secretary shall coordinate the Program with the National Health Surge Reserve and emergency procurement authority under section 605 to avoid duplication and to ensure that emergency surge deployments and rural and frontier deployments are planned and sequenced in a consistent manner.
(4)Coordination with hubs. The Secretary shall coordinate deployments under this section with Title XII hubs and rural and frontier readiness tools to support orderly transition to sustainable civilian capacity.
(f)Privacy, standards of care, credentialing, and liability.
(1)Privacy. All services furnished under the Program shall comply with applicable Federal and State privacy laws, including the Health Insurance Portability and Accountability Act of 1996 and its implementing regulations, and System privacy and security standards.
(2)Standards of care. Personnel deployed under the Program shall furnish services in accordance with generally accepted professional standards of care and with applicable State licensure and scope of practice requirements, subject to any temporary waivers or compacts that may apply.
(3)Credentialing and liability. The Secretary shall establish expedited credentialing procedures for personnel deployed under this section and shall specify the applicable liability coverage and claims handling rules for services furnished under the Program.
(g)Reporting and sunset.
(1)Annual report. Not later than March 31 of each year beginning with the second year after the main implementation date, the Secretary shall submit to Congress and make publicly available a report that
(A)summarizes deployments under the Program during the preceding year,
(B)describes the rural and frontier areas served and the types and volume of services furnished,
(C)evaluates the impact of the Program on access, quality, and workforce strain using the metrics reported under this Act, and
(D)identifies recommendations for improvement, including transition strategies to sustainable civilian capacity.
(2)Sunset. The authority under this section shall terminate on December 31, 2035, except that the Secretary may continue deployments already in progress as of that date for up to 90 days to ensure an orderly transition, unless otherwise provided by a subsequent Act of Congress.
(h)Funding limitation. Out of amounts in the Trust Fund, the Secretary may expend not more than $275,000,000 per fiscal year to carry out this section. No amounts are authorized to be appropriated from the general fund of the Treasury for purposes of this section.
TITLE VII. MEDICAL DEBT REDEMPTION.
TITLE VII—MEDICAL DEBT REDEMPTION.
SEC. 701.MEDICAL DEBT REDEMPTION FACILITY.
(a)Establishment. The Secretary shall establish a Medical Debt Redemption Facility within the
Department of Health and Human Services.
(b)Funding and authority.
(1)In general. For each of the first 10 fiscal years beginning on or after the main implementation
date, there are authorized to be transferred from the Trust Fund to the Facility not less than
5,000,000,000 dollars and not more than 15,000,000,000 dollars per year, as needed to meet the
objectives of this title.
(2)Purchasing efficiency goal. The Facility shall seek to acquire eligible medical debt at the
lowest feasible cost as measured by cents paid per dollar of face value, consistent with
verification and consumer protections.
(3)Report. Not later than 180 days after the end of each fiscal year, the Secretary shall submit a
report to Congress stating
(A)total face value acquired,
(B)total price paid,
(C)average cents per dollar paid,
(D)total debt cancelled, and
(E)remaining estimated stock of eligible medical debt.
(c)Objective. The Facility shall prioritize actions intended to eliminate the majority of eligible
legacy medical debt within the first 10 fiscal years, subject to availability of portfolios for
purchase at reasonable market prices.
SEC. 702.ACQUISITION AND CANCELLATION OF MEDICAL DEBT.
(a)Authority to acquire. The Facility may purchase portfolios of medical debt at fair market
value from providers, collectors, and debt buyers.
(b)Priority. The Facility shall give priority to portfolios that
(1)consist mainly of debt owed by individuals with individual income below or near the national
median individual income, or
(2)involve older debts, or
(3)have already been sold for collection at a deep discount.
(c)Cancellation. Debt acquired under this section shall be cancelled. No person may attempt to
collect such debt.
SEC. 703.CONSUMER PROTECTIONS.
(1)affected individuals are notified of cancellation in clear language, and
(2)credit reporting agencies update records to reflect that such debt has been forgiven and shall
not be reported as active debt.
TITLE VIII. FRAUD, WASTE, AND ABUSE CONTROLS.
TITLE VIII—FRAUD, WASTE, AND ABUSE CONTROLS.
SEC. 801.NATIONAL HEALTH CLAIMS DATA PLATFORM AND MANDATORY CLEARINGHOUSE.
(a)Establishment. The Secretary shall create and operate a National Health Claims Data Platform to receive, store, and analyze claims and eligibility data for services covered under this Act, and to function as the mandatory national clearinghouse for essential health services furnished to members.
(b)Mandatory participation.
(1)Certified plans. Each certified plan, the Federal Standard Plan, and any subcontractor acting on behalf of such plan shall use the Platform for eligibility verification, enrollment transactions, claims submission, claims adjudication, payment routing, remittance, and required reporting for essential health services furnished to members.
(2)Participating providers. Participating providers shall submit claims and required clinical and administrative attachments for essential health services through the Platform in accordance with standards established under subsection (c).
(3)No parallel proprietary rails. A certified plan may not require a provider to use a separate proprietary claims rail, portal, or attachments format for essential health services. The Platform shall be the controlling transaction layer.
(c)Standards.
(1)Uniform transaction standards. The Secretary shall establish uniform data and transaction standards for eligibility, claims, remittance, prior authorization transactions where permitted, appeals payloads, and audit logs.
(2)One billing form. The Secretary shall establish a uniform billing and coding implementation guide for essential health services for members and shall maintain an edits library that is applied uniformly across certified plans.
(3)Interoperability and right to repair. The Secretary shall require open, documented application programming interfaces that allow providers, members, and certified plans to access and transmit Platform data securely, and shall prohibit unreasonable restrictions on integration and repair of health information technology systems used to comply with this Act.
(d)Payment routing.
(1)Payment rail. The Platform shall support payment routing so that participating providers are paid electronically and promptly in accordance with applicable prompt pay standards.
(2)Funding source. Payments routed through the Platform shall be funded from certified plan accounts and Trust Fund mechanisms established under sections 201 and 207A, under rules prescribed by the Secretary.
(e)Integrity and analytics. The Secretary shall use the Platform for real time fraud detection, pre payment review, audit targeting, and performance monitoring as provided in sections 802 through 808.
(f)Data governance and privacy. The Secretary shall establish strong privacy, security, and access controls for Platform data, including role based access, audit trails, and penalties for misuse, and shall coordinate with the protections in section 805.
(g)Enforcement. The Secretary may impose civil monetary penalties, suspend transaction privileges, or take other enforcement action against certified plans or providers that materially fail to comply with Platform requirements, subject to due process procedures prescribed by the Secretary.
SEC. 802.REAL TIME FRAUD DETECTION AND PRE PAYMENT REVIEW.
(a)Analytics. The Secretary shall implement analytic systems, including statistical and machine
learning methods, to identify anomalous billing patterns in near real time.
(b)Pre payment review. The Secretary may withhold payment of claims that are flagged as high
risk until a review is completed.
SEC. 803.FEDERAL FELONY PENALTIES FOR SYSTEMIC FRAUD.
(a)Offense. Any person who knowingly executes or attempts to execute a scheme to defraud the
System or the Trust Fund in an amount that exceeds 100,000 dollars in any twelve month period
commits a Federal offense.
(b)Penalties. The offense shall be punishable by imprisonment, fines, and mandatory forfeiture
of property derived from the offense, in a manner similar to penalties for major health care fraud
and wire fraud under existing law.
SEC. 804.PERFORMANCE, VALUE, AND INTEGRITY MONITORING USING
(a)Establishment. The Secretary shall establish a continuous performance monitoring program
for the SAFECARE System, to be known as the National Health Integrity, Efficiency, and Value
Program.
(b)Purpose. The purposes of the Program are to
(1)detect and reduce fraud, waste, and abuse,
(2)measure and reduce administrative burden,
(3)identify high value care and low value care patterns,
(4)improve payment accuracy and timeliness,
(5)monitor access, quality, and outcomes, and
(6)support evidence based benefit design and clinical standards over time.
(c)Use of advanced analytics and AI tools. The Secretary shall deploy modern analytic tools,
including state of the art statistical methods and machine learning or AI systems, to support the
purposes in subsection (b), subject to the safeguards in this section.
(d)Required system capabilities. The Program shall include, at minimum, capabilities to
(1)produce real time dashboards for claims flow, payment timeliness, denial rates, appeal rates,
provider participation, and member access metrics,
(2)identify abnormal billing patterns and network level anomalies,
(3)estimate administrative cost and time burdens on providers and reduce such burdens through
simplified rules, standardized documentation, and automation where appropriate,
(3A)provider burden reduction accountability. The Secretary shall measure and publish, on not
less than an annual basis, objective indicators of administrative burden on participating
providers, including estimated hours spent on billing, documentation, prior authorization, and
appeals, and shall publish year over year changes in such indicators and the specific rule or
system changes responsible for reductions,
(4)monitor utilization and outcomes to identify low value or duplicative services and
opportunities for prevention,
(5)measure the impact of payment policy changes on rural, frontier, and safety net access, and
(6)support program integrity actions under section 802 while minimizing improper denials and
delays.
(e)Human review and due process. The Secretary shall ensure that
(1)any adverse action triggered by analytic or AI systems, including a payment hold, denial,
recoupment, or referral for investigation, is subject to human review before final action, except
for automated holds of limited duration for clearly defined high risk patterns as determined by
regulation,
(2)providers and members have access to a timely appeals process with clear explanations
of the basis for the action, and
(3)the use of analytic tools does not create unreasonable barriers to medically necessary care.
(f)Transparency and reporting.
(1)Public reporting. Not later than 18 months after the main implementation date, and annually
thereafter, the Secretary shall publish a performance report describing System performance on key
metrics, including fraud recoveries, improper payment rates, administrative burden measures,
access measures, and outcome measures.
(2)Model transparency. The Secretary shall publish plain language descriptions of the categories
of signals and factors used by analytic systems for fraud detection and payment integrity, while
protecting sensitive enforcement details.
(g)Model governance and audits.
(1)Governance. The Secretary shall establish model governance requirements, including
documentation of training data sources, validation methods, change control, and ongoing
monitoring for model drift.
(2)Independent audit. The Inspector General of the Department of Health and Human Services
shall conduct periodic audits of the Program, including review of accuracy, error rates, improper
denials, and compliance with subsection (e).
(3)Bias and fairness testing. The Secretary shall test analytic systems for disparate impacts on
protected classes and on underserved communities, and shall mitigate identified issues through
model adjustments and policy controls.
(h)Privacy and use limitations. Data and analytic outputs under this section shall be used only
for health program administration, payment integrity, quality improvement, and public health
functions authorized by this Act. Such data shall not be used for immigration enforcement or non
health purposes.
(i)Cybersecurity. The Secretary shall implement cybersecurity controls consistent with Federal
standards and shall conduct regular security testing of systems used under this section.
(j)Authorization of appropriations. There are authorized to be appropriated from the Trust Fund
such sums as may be necessary to carry out this section, including procurement of analytic
tooling, staffing, independent evaluation, and security measures.
SEC. 805.PROTECTIONS AGAINST ALGORITHMIC OVERREACH.
(a)Prohibition on automated payment suspensions.
Notwithstanding section 802(b) or section 804(e)(1), no payment may be withheld,
suspended, or denied solely on the basis of an algorithmic flag, artificial intelligence
score, or statistical anomaly.
(1)Human verification required. A payment suspension may only take effect after a
qualified human investigator has reviewed the specific evidence and certified, in
writing, that there is probable cause to suspect fraud or material non compliance.
(2)Time limit. The human review described in paragraph (1) must be completed
within 72 hours of the algorithmic flag. If the review is not completed within that
window, the payment must be released.
(b)The false flag penalty.
(1)Reimbursement. If a provider successfully appeals a payment denial or suspension
that was initiated by an automated system, the System shall pay the provider
(A)the full amount of the claim, plus interest, and
(B)an Administrative Defense Fee of 50 dollars per claim or 15 percent of the claim
value, whichever is greater, to compensate for the time and resources spent correcting
the System's error.
(2)Purpose. This fee is intended to incentivize the Secretary to tune algorithmic
models for high precision rather than high recall.
(c)Explainability right. In any notice of denial or suspension based on an analytic
model, the Secretary must provide the specific variables and weighting factors that
triggered the flag. A generic description, including an unusual pattern, shall be
insufficient legal notice.
SEC. 806.PROVIDER FINANCIAL INTEGRITY AND ANTI ASSET STRIPPING.
(a)Definitions. For purposes of this section.
(1)Covered facility. The term “covered facility” means any participating hospital or facility that
has entered into a Participation Agreement under section 401.
(2)Control. The term “control” means the direct or indirect power to direct management or
policies of a covered facility, whether through ownership of voting securities, contract, or
otherwise, as determined by the Secretary.
(3)Control transaction. The term “control transaction” means any transaction or series of
transactions that results in a person or affiliated group obtaining control of a covered facility.
(4)Covered owner. The term “covered owner” means any person or affiliate that controls a
covered facility, including any private equity sponsor, for profit acquirer, or management entity.
(5)Primary clinical real estate. The term “primary clinical real estate” means real property
used primarily for inpatient care, emergency care, surgery, or other essential clinical operations,
as determined by the Secretary.
(6)Sale leaseback transaction. The term “sale leaseback transaction” means a transaction in
which a covered facility or its controlled affiliate sells, transfers, or otherwise conveys an interest
in primary clinical real estate and simultaneously or subsequently leases, licenses, or otherwise
obtains a right to occupy or operate that real estate.
(7)Covered transfer. The term “covered transfer” means any dividend, distribution,
redemption, management fee, monitoring fee, consulting fee, or other payment to a covered
owner or an affiliate of a covered owner, other than payment for goods or services provided at
fair market value in the ordinary course of clinical operations, as determined by the Secretary.
(b)Restrictions on predatory real estate extraction.
(1)Transition approval. A covered facility may not enter into a sale leaseback transaction
involving primary clinical real estate during the transition period, unless the Secretary approves
the transaction under paragraph (2).
(2)Approval standard. The Secretary may approve a sale leaseback transaction only if the
Secretary determines, based on clear documentation, that the transaction is necessary to
maintain or improve clinical solvency and access, and that all of the following conditions are met.
(A)Fair valuation. The real estate transfer price and lease terms reflect fair market value as
supported by an independent appraisal.
(B)Clinical use of proceeds. Net proceeds are used for clinical operations, patient safety,
technology modernization, or facility capital improvements, and are not used for covered
transfers.
(C)Rent guardrails. Lease escalation terms are reasonable and do not create a foreseeable
risk of insolvency.
(D)Transparency. The covered facility discloses the full transaction structure, all related
parties, and all fees and side agreements.
(3)Review of existing arrangements. The Secretary shall require disclosure of any existing
sale leaseback transaction involving primary clinical real estate. If the Secretary determines that
an existing arrangement poses a material risk to clinical solvency or access, the Secretary may
require a corrective action plan as a condition of continued participation or eligibility for grants
under section 604. Such plan may include voluntary renegotiation, refinancing support, or other
measures authorized under this Act.
(c)Prohibition on dividend recapitalization and debt funded distributions.
(1)Dividend recapitalization freeze. For five years following a control transaction involving a
covered owner, a covered facility may not incur debt, issue notes, grant liens, or otherwise
encumber assets if the proceeds are used, directly or indirectly, to fund a covered transfer.
(2)Anti circumvention. The prohibition in paragraph (1) applies regardless of whether the debt
is issued by the covered facility, by a controlled affiliate, or through an arrangement that
reasonably results in repayment obligations being borne by the covered facility, as determined
by the Secretary.
(3)Required disclosures. A covered facility shall disclose to the Secretary any material new debt
issuance, intercompany loan, or fee arrangement with a covered owner or affiliate, in the form
and frequency specified by the Secretary.
(d)Stewardship covenant and continuity protections.
(1)Covenant required. As a condition of participation following a control transaction, the
covered owner shall execute a stewardship covenant in a form specified by the Secretary that
requires maintenance of clinically adequate operations and prohibits covered transfers that
materially impair solvency.
(2)Bond or escrow authority. The Secretary may require a covered owner to post a continuity
bond or escrow, sized in relation to operating risk, to ensure funds are available for orderly
continuity of care planning if the facility becomes distressed.
(3)Trigger event. If a covered facility files for bankruptcy, ceases essential clinical operations,
or permanently closes within five years after a covered owner’s exit, sale, or loss of control, the
Secretary may seek recovery from the covered owner and its affiliates of up to 100 percent of
covered transfers paid during the preceding ten years, to the extent the Secretary determines
such recovery is necessary to support patient transition, emergency continuity measures, and
workforce stabilization activities under this Act.
(4)Due process. Before imposing recovery under paragraph (3), the Secretary shall provide
notice, an opportunity to respond, and an administrative determination that identifies the
covered transfers at issue and the basis for the recovery.
(e)Enforcement.
(1)Participation remedies. The Secretary may impose corrective action plans, payment
withholds, suspension of participation, or termination of a Participation Agreement for material
violations of this section.
(2)Civil monetary penalties. The Secretary may impose civil monetary penalties for violations of
this section in amounts sufficient to deter non compliance, as specified by regulation.
(3)Coordination with grants. The Secretary may condition eligibility for capital grants under
section 604 on compliance with this section.
SEC. 807.NATIONAL PLATFORM LIABILITY SHIELD.
(a)Definitions. In this section.
(1)Federal health platform. The term “Federal health platform” means any Federal information system,
database, registry, or platform established or maintained by the Secretary under this Act, including the
National Health Claims Data Platform and the National Donor Preference Registry.
(2)Covered provider. The term “covered provider” means any participating provider or facility that has
entered into a Participation Agreement under section 401.
(3)Covered cybersecurity standards. The term “covered cybersecurity standards” means safeguards
required by the Secretary for covered providers, as specified by regulation.
(b)Safe harbor from civil liability for Federal platform breaches.
(1)In general. No covered provider shall be liable in any civil action for damages arising solely from an
unauthorized access to, acquisition of, or disclosure of protected health information that occurs within a
Federal health platform, if the covered provider was in material compliance with covered cybersecurity
standards at the time of the breach.
(2)Limitations. Nothing in this section.
(A)limits liability for a breach of a covered provider’s own systems or records.
(B)limits liability for gross negligence, willful misconduct, or fraud by a covered provider.
(C)creates a private right of action.
(D)waives sovereign immunity of the United States.
(c)Provider breach response assistance. The Secretary shall provide covered providers with standardized
breach notice templates and technical guidance for incidents involving a Federal health platform.
SEC. 808.DOMESTIC PERFORMANCE AND ACCESS CONTROLS FOR FEDERAL HEALTH PLATFORMS.
(a)Definitions.
In this section:
(1)Federal health platform. The term Federal health platform has the meaning given in
section 807(a)(1).
(2)Covered System system. The term covered System system means any Federal health platform and
any other information system, environment, or service, whether operated by the Department or
by a contractor, that the Secretary designates as mission critical to System enrollment,
eligibility, claims, payment, identity verification, member facing access, provider portals,
program integrity, or other System operations and that processes, stores, or can access
protected health information or System confidential operational data.
(3)Privileged access. The term privileged access means administrative, root, superuser,
database administrator, cloud administrator, security administrator, or other elevated
access that can materially alter system behavior, security posture, availability, or
confidentiality, including just in time privileged access.
(4)U.S. person. The term U.S. person means a citizen of the United States or an alien
lawfully admitted for permanent residence.
(b)Domestic performance requirement.
For any contract, subcontract, or other agreement for design, development, integration,
testing, maintenance, or operations of a covered System system, the Secretary shall require
that covered work be performed within the United States by individuals physically located
within the United States.
(c)No offshore privileged access and U.S. person requirement.
(1)No offshore privileged access.
The Secretary shall require that no covered System system be administered or supported through
privileged access from outside the United States. A contractor or subcontractor may not
permit any individual located outside the United States to obtain privileged access to a
covered System system.
(2)U.S. person requirement for privileged access.
The Secretary shall require that any individual with privileged access to a covered System
system be a U.S. person.
(3)U.S. person requirement for direct access to protected health information.
The Secretary shall require that any individual who is granted direct access to protected
health information within a covered System system, including for debugging, incident response,
or data operations, be a U.S. person.
(d)Flow down and contractor controls.
(1)Flow down.
The Secretary shall require that the requirements of this section be included as material
terms in all contracts and subcontracts at any tier for covered System systems.
(2)Minimum controls.
The Secretary shall require contractors to implement strong access controls, including
identity proofing, multi factor authentication, device posture checks, least privilege, just
in time access with time limits, two person approval for sensitive actions as appropriate,
continuous logging, and independent monitoring sufficient to enforce subsections (b) and
(c).
(e)Consulting and standards coordination.
Nothing in this section prohibits the Secretary or a contractor from communicating with
foreign governments or foreign health system operators for purposes of standards alignment,
lessons learned, threat intelligence, or non operational consulting. Such communication may
not include providing any foreign person access to a covered System system or to non public
source code, credentials, configuration, or protected health information. Any data shared
for such purposes shall be de identified or synthetic, unless otherwise required by law and
approved under procedures established by the Secretary.
(f)Waiver for discrete components.
(1)In general.
The Secretary may waive the domestic performance requirement in subsection (b) for a
discrete component only upon a written determination that no qualified domestic capability
exists to perform the work in a timely and reasonable manner and that the waiver is
necessary to avoid material risk to System continuity or security.
(2)No waiver of privileged access restrictions.
A waiver under paragraph (1) may not waive subsection (c). Under no circumstances may a
waiver permit offshore privileged access or permit a non U.S. person to hold privileged
access to a covered System system.
(3)Notice.
Not later than 30 days after issuing a waiver under paragraph (1), the Secretary shall
notify Congress and shall publish a public summary that protects security sensitive and
procurement sensitive information.
(g)Transition and effective dates.
(1)New contracts.
The Secretary shall include the requirements of this section in solicitations and contracts
for covered System systems issued on or after the date that is 180 days after enactment of
this Act.
(2)Existing contracts.
For covered System systems supported under a contract in effect on the date of enactment, the
Secretary shall require compliance with subsections (b) and (c) not later than the date that
is 24 months after enactment, under a transition plan that avoids disruption of System
readiness milestones.
(h)Enforcement.
A violation of a requirement under this section shall be treated as a material breach. The
Secretary may impose contract remedies, payment withholds, termination for default,
suspension or debarment referrals, and civil monetary penalties as specified by regulation.
(i)Coordination with workforce transition and hubs.
In administering contracts for member support, provider support, identity and access
escalation, security operations coordination, and incident communications for covered System
systems, the Secretary shall, to the maximum extent practicable, align such functions with
the Regional Operations Hubs established under section 1206 and implement priority hiring
for displaced workers under sections 1202 and 1203.
SEC. 809.HEALTH INFRASTRUCTURE TECHNOLOGY CERTIFICATION AND PROCUREMENT STANDARDS.
(a)Definitions.
In this section:
(1)Health Infrastructure Technology. The term Health Infrastructure Technology means any hardware, software, service, platform, appliance, gateway, connector, identity system, network equipment, device management system, security module, interoperability component, clearinghouse integration, audit logging system, or other technology that is used by a participating facility, a certified plan, a contractor, or an agent to comply with, connect to, implement, administer, secure, or operationalize any requirement under this Act, including enrollment, eligibility, claims, payments, prior authorization, quality reporting, interoperability, patient information exchange, device connectivity, identity and access management, audit logging, and cybersecurity controls.
(2)Covered vendor. The term covered vendor means any manufacturer, publisher, integrator, distributor, or service provider that sells, licenses, supports, hosts, or materially controls Health Infrastructure Technology used for compliance with this Act.
(3)Certified Health Infrastructure Technology. The term Certified Health Infrastructure Technology means Health Infrastructure Technology that meets the certification requirements established under subsection (b).
(4)Lock in restriction. The term lock in restriction means any contractual, technical, or operational measure that materially prevents substitution by a functionally equivalent product or service implementing published standards, including proprietary dependencies, exclusive tooling requirements, non exportable configurations, unreasonable switching penalties, artificial delays, or the use of technical measures primarily intended to impede lawful repair, lawful interoperability, or lawful independent servicing.
(5)Essential for continuity. The term essential for continuity means a category of Health Infrastructure Technology that the Secretary designates as necessary to maintain uninterrupted compliance operations, continuity of care functions, payment integrity, core security functions, or core data exchange functions under this Act.
(b)Certification program and phased rollout.
(1)Establishment. Not later than 18 months after the date of enactment, the Secretary shall establish a certification program for Health Infrastructure Technology used to comply with this Act, and may carry out such program using the Secretary’s general regulatory and administrative authorities, including the authorities in section 1101.
(2)De minimis exclusions. The Secretary may exclude from certification requirements technology, tools, or components that are de minimis and low risk, where certification would not materially advance safety, cybersecurity, interoperability, portability, auditability, or anti lock in purposes, provided that such exclusions are narrowly tailored and published.
(3)Phased mandatory certification for new procurement and renewal.
(A)Phase 1. Not later than 30 months after the date of enactment, no participating facility, certified plan, or contractor may newly procure, newly deploy, or newly renew material support for any Health Infrastructure Technology in categories designated by the Secretary as essential for continuity unless such technology is Certified Health Infrastructure Technology, except as provided in subsection (h).
(B)Phase 2. Not later than 42 months after the date of enactment, the requirement in subparagraph (A) shall apply to additional categories designated by the Secretary that materially affect compliance, interoperability, security, auditability, and operational resilience, including identity and access management, gateways, core connectors, device management, and network equipment used for compliance workflows.
(C)Phase 3. Not later than 54 months after the date of enactment, the requirement in subparagraph (A) shall apply to all remaining categories of Health Infrastructure Technology used for compliance with this Act, as determined by the Secretary.
(4)Minimum certification requirements. The Secretary shall require, at a minimum, that Certified Health Infrastructure Technology
(A)supports interoperability through published and documented standards for all interfaces required to implement this Act, including secure data exchange, audit logging, and identity controls,
(B)provides documented export and portability for configurations, policies, logs, and relevant operational state in machine readable formats sufficient to enable substitution,
(C)provides qualified repair and service access consistent with section 410, including diagnostic and restore capability and a compliant pathway for qualified repair where applicable,
(D)prohibits lock in restrictions as defined in subsection (a)(4),
(E)provides lifecycle commitments for security updates and critical patches for a minimum support term set by the Secretary based on risk and use category, and for categories essential for continuity includes minimum vulnerability response timelines and minimum patch availability timelines established by the Secretary,
(F)provides recovery images, rollback procedures, and verifiable restore methods sufficient to return to a known good state after failure or compromise,
(G)maintains auditable change logs and tamper evident event logging sufficient for compliance and forensic review, and
(H)submits to conformance testing under subsection (c).
(c)Conformance testing and public scorecards.
(1)Testing. The Secretary shall establish conformance tests to verify compliance with subsection (b)(4), including repair access controls, portability, interoperability, lifecycle support commitments, and the absence of lock in restrictions.
(2)Public scorecards. The Secretary shall publish and maintain a public scorecard for each Certified Health Infrastructure Technology product line and covered vendor, including certification status, test outcomes, patch support commitments, vulnerability response commitments, and any enforcement actions under subsection (g).
(d)Procurement and contracting requirements.
(1)No proprietary dependency. No procurement, grant, contract, or reimbursement conditioned acquisition under this Act may require a proprietary dependency that prevents substitution by a functionally equivalent product implementing published standards.
(2)Portability clause. Every contract for Health Infrastructure Technology used for compliance with this Act shall include a portability clause requiring the covered vendor to provide timely export of configurations, logs, and operational state, and to provide reasonable transition assistance at commercially reasonable rates, without punitive fees, artificial delays, retaliation, or degradation of functionality.
(3)Contract override. Any term that conflicts with this section or section 410 is void and unenforceable.
(4)Most favored repair. If a covered vendor provides a repair, servicing, diagnostic, restoration, or tooling access program for any customer or jurisdiction that is more permissive than what is provided under this Act, the covered vendor shall provide terms no less permissive to participating facilities and qualified repair providers under this Act.
(e)Legacy systems transition rule.
(1)Continued operation permitted. Health Infrastructure Technology that is deployed before the applicable phase deadline under subsection (b)(3) may continue to operate during a transition period established by the Secretary, including under existing contracts, provided that the requirements in paragraph (2) are met.
(2)Minimum transition obligations. Not later than 12 months after the date a category becomes subject to subsection (b)(3), any covered vendor supporting a non certified legacy system used for compliance workflows shall, as a condition of continued use for compliance under this Act
(A)provide export and portability capabilities required under subsection (b)(4)(B),
(B)provide recovery and rollback capabilities required under subsection (b)(4)(F),
(C)comply with section 410 for any repair and servicing access applicable to the technology, and
(D)comply with escrow requirements under subsection (f) if designated essential for continuity.
(3)Refusal. If a covered vendor refuses to satisfy paragraph (2), the Secretary may determine that continued use of the legacy system for compliance workflows is not permitted after a date certain and shall require a transition plan to Certified Health Infrastructure Technology.
(f)Escrow and continuity backstop for critical tooling.
(1)Escrow authority. For categories of Health Infrastructure Technology designated by the Secretary as essential for continuity, the Secretary shall require escrow of recovery images, restore tools, and necessary documentation sufficient to maintain continuity if the covered vendor exits the market, materially degrades access, or becomes unable or unwilling to perform.
(2)Release trigger. The Secretary may release escrow materials to participating facilities or designated operators only upon a written finding of necessity for continuity, subject to cybersecurity controls, access controls, and audit requirements.
(g)Enforcement and exclusion.
(1)Civil remedies. The Secretary may impose civil monetary penalties for violations of this section, require corrective action plans, require independent monitoring, and order specific performance to cure portability, interoperability, repair access, lifecycle support commitments, or lock in violations.
(2)Suspension and exclusion. The Secretary may suspend or revoke certification and may prohibit a covered vendor or a specific product line from use for compliance with this Act for a defined period, upon a finding of material noncompliance, repeated violations, willful lock in restrictions, or willful misrepresentation in certification or waiver submissions.
(3)Payment consequences. The Secretary may condition reimbursement eligibility for compliance dependent technology on certification status and compliance with this section.
(h)Narrow temporary waivers with operational continuity controls.
(1)In general. The Secretary may grant a temporary waiver from subsection (b)(3) only if the requesting entity demonstrates that no feasible certified alternative exists for the required function and that the waiver is necessary to maintain continuity of operations.
(2)Limits. Any waiver shall be narrowly tailored, shall require a transition plan to certified alternatives, and shall last not more than 18 months.
(3)One renewal. The Secretary may renew a waiver once for not more than 18 months only upon a new evidentiary showing that the requesting entity is implementing the transition plan in good faith and that no feasible certified alternative exists.
(4)Interim protections. As a condition of any waiver, the Secretary shall require interim controls sufficient to prevent vendor hostage risk, including, as applicable, portability exports, recovery images, rollback procedures, escrow, and a secure service mode or controlled access program for qualified servicing and restoration.
(i)Federal coordination rule of construction. Nothing in this section shall be construed to limit the independent statutory authorities of any Federal department or agency. For purposes of compliance with this Act and reimbursement eligibility under this Act, any restriction on repair access, parts, tools, diagnostics, firmware, calibration, interoperability, service access, or related access controls must satisfy section 410(h).
(j)Authorization of appropriations and dedicated capacity.
(1)In general. There are authorized to be appropriated such sums as may be necessary to carry out this section and the Secretary’s responsibilities under section 410(h) through (l).
(2)Office. The Secretary may establish or designate an office within the Department of Health and Human Services to administer certification, conformance testing, public scorecards, escrow, and enforcement under this section and section 410.
TITLE IX. MEDICAL LIABILITY AND MALPRACTICE REFORM.
TITLE IX—MEDICAL LIABILITY AND MALPRACTICE REFORM.
SEC. 901.PURPOSE AND SCOPE.
(a)Purpose. The purpose of this title is to
(1)preserve meaningful remedies and full recovery of documented economic losses for patients
who suffer injury as a result of substandard care,
(2)stabilize and reduce the cost of medical liability coverage for providers and facilities,
(3)reduce incentives for defensive medicine that does not improve outcomes, and
(4)align the medical liability system with the clinical standards and safety goals of the
SAFECARE System in a way that improves patient safety over time.
(b)Scope. This title applies to any claim for personal injury or wrongful death that
(1)arises from the provision of, or failure to provide, health care services by a provider, and
(2)is paid in whole or in part, directly or indirectly, from the Trust Fund.
SEC. 901A.NATIONAL CLINICAL STANDARDS BOARD.
(a)Establishment. There is established an independent board to be known as the National Clinical Standards Board (in this Act referred to as the "Board").
(b)Membership. The Board shall consist of 15 members appointed by the Comptroller General of the United States. The Comptroller General shall seek to ensure that membership includes practicing physicians across major specialties, clinical researchers with expertise in evidence synthesis, and patient advocates.
(c)Duties. The Board shall review and endorse evidence-based clinical practice guidelines for purposes of the safe harbor under section 902 and shall periodically update endorsed guidelines as evidence evolves. The Board may endorse guidelines developed by recognized professional societies or independent guideline bodies.
(d)Publication. The Secretary shall publish endorsed guidelines in a publicly accessible format and shall maintain a current index of guidelines endorsed by the Board for purposes of section 902.
SEC. 902.SAFE HARBOR FOR ADHERENCE TO NATIONAL CLINICAL
(a)Presumption of reasonable care. In any action described in section 901, a provider shall be
presumed to have met the applicable standard of care if the provider shows that
(1)the care at issue was delivered in accordance with clinical practice guidelines, coverage
criteria, or quality standards that were issued or endorsed by the National Clinical Standards
Board established under section 901A, and
(2)the provider documented in the medical record the basis for applying those guidelines,
criteria, or standards to the patient at the time of treatment.
(b)Clinical judgment and justified deviation. A provider may depart from a guideline, criteria, or
standard described in subsection (a) when, in the professional judgment of the provider, the
specific clinical circumstances require a different course of action. If the provider documents in
the medical record, at or near the time of care,
(1)the relevant guideline, criteria, or standard, and
(2)the clinical reasons for deviation in the case of that patient,
then the presumption in subsection (a) shall apply in the same way as if the guideline had been
followed.
(c)Rebuttal. The presumption under this section may be rebutted only by clear and convincing
evidence that
(1)the provider materially misapplied a guideline, criteria, or standard, or
(2)the provider engaged in reckless, intentional, or grossly negligent conduct that no reasonable
practitioner would have considered consistent with the protection of the patient.
(d)No immunity for gross negligence. Nothing in this section shall be construed to shield a
provider from liability for conduct that constitutes reckless disregard of patient safety, intentional
harm, fraud, or impairment due to substance abuse.
(e)Patient rights. The existence of guidelines, criteria, or standards under this Act shall not, by
itself, limit a patient's right to file a claim or to recover economic damages for proven harm.
SEC. 903.LIMITATION ON NONECONOMIC DAMAGES.
(a)General rule. In any action described in section 901, the total amount of noneconomic
damages that may be awarded to any claimant for all defendants combined shall not exceed
(1)500,000 dollars for claims that do not involve catastrophic injury or death, and
(2)1,000,000 dollars for claims that involve catastrophic injury or death,
for claims arising in calendar years 2026 through 2030.
(b)Catastrophic injury. For purposes of this section, catastrophic injury means permanent and
substantial impairment of a major bodily function. This includes but is not limited to permanent
paralysis, severe traumatic brain injury with lasting functional loss, major loss of vision, or major
loss of limb.
(c)Preservation of economic damages. This section does not limit recovery of economic
damages. Economic damages include past and future medical expenses, rehabilitation costs, loss
of earnings, loss of earning capacity, and the reasonable cost of necessary long term care and
support.
(d)Indexing. Beginning in calendar year 2031, the Secretary shall adjust the dollar amounts in
subsection (a) not less than once every three years. The adjustment shall be based on growth in a
health care wage or cost index defined by regulation. The Secretary shall publish the updated
amounts in the Federal Register.
(e)Exceptional cases. In an exceptional case in which the court finds, after written findings of
fact, that
(1)the injury has resulted in extraordinary and lifelong loss of function, or
(2)the conduct of the defendant displayed reckless disregard of patient safety,
the court may increase the applicable cap in subsection (a) by up to fifty percent for that
claimant.
(f)Multiple claimants and wrongful death. In an action with multiple claimants or a wrongful
death claim that arises from a single act or course of treatment, the court shall apportion the
applicable cap among claimants as justice requires. The total noneconomic recovery for all
claimants combined shall not exceed the applicable amount under subsection (a) as adjusted
under subsection (d), except as increased under subsection (e).
(g)Limited preemption for Trust Fund paid claims.
(1)In general. For actions described in section 901 that are paid in whole or in part from the
Trust Fund, State laws that allow higher noneconomic damages than the caps in this section shall
not apply.
(2)State authority preserved. Except as provided in paragraph (1), States may apply additional
patient protections, procedures, or lower caps, and may maintain or adopt health courts or panels,
provided that such State provisions do not impose higher noneconomic damages than permitted
under this section for Trust Fund paid claims.
SEC. 904.HEALTH COURTS AND SPECIALIZED PANELS.
(a)Encouragement of specialized forums. The Secretary, in consultation with the Attorney
General, may provide grants and technical assistance to States that establish specialized health
courts or expert panels to hear claims described in section 901.
(b)Features. A health court or panel supported under this section shall
(1)use judges or adjudicators with training or experience in health care law or policy,
(2)make use of neutral medical experts to assist in evaluating standard of care and causation,
(3)issue written decisions that summarize the evidence and reasoning, and
(4)collect and share de identified data on adverse events and rulings to support patient safety
efforts.
SEC. 905.MALPRACTICE INSURANCE RATE REVIEW.
SEC. 906.REPORTING AND PATIENT SAFETY INTEGRATION.
(1)supporting confidential reporting systems for near misses and adverse events, and
(2)encouraging the use of claims analysis to identify patterns, system failures, and opportunities
for prevention, without turning every report into a punishment event for individual clinicians
acting in good faith.
SEC. 907.PRESERVATION OF STATE PROCEDURES.
(1)alter State rules on pleading, discovery, or trial procedure, or
(2)limit the authority of State medical boards to license, discipline, or remove providers.
TITLE X. TRANSITION AND INTEGRATION OF EXISTING PROGRAMS.
TITLE X—TRANSITION AND INTEGRATION OF EXISTING PROGRAMS.
SEC. 1001.INTEGRATION OF MEDICARE, MEDICAID, CHIP, AND ACA
(a)Phased integration. Over the transition period defined in section 1005 and subject to section
207, the essential health
coverage components of Medicare, Medicaid, the Children's Health Insurance Program, and
premium subsidies and cost sharing reductions under the Affordable Care Act shall be integrated
into the System.
(b)Protection of beneficiaries. During transition, no individual shall lose coverage or see gaps in
treatment solely because of integration activities.
SEC. 1002.VETERANS HEALTH CARE.
(a)Core coverage. Essential health services for veterans shall be covered under the System in the
same way as for other members.
(b)Supplemental veterans benefits. The Department of Veterans Affairs may continue to operate
programs that provide supplemental benefits and specialized services beyond the national
essential benefit floor.
(c)Territorial access. In United States territories where a full service Department of
Veterans Affairs medical facility is not available within 30 minutes of a veteran's
residence, such veteran shall be automatically eligible to receive essential health services
from any participating SAFECARE provider, with costs reimbursed by the System.
(d)Excess capacity participation.The Secretary of Veterans Affairs may, at the Secretary's discretion, designate VA medical facilities with available capacity as participating SAFECARE System providers for essential health services furnished to non-veteran members, with veterans receiving absolute priority at all times. Services furnished under this subsection shall be reimbursed from the SAFECARE Trust Fund at the Universal Rate Schedule under section 402.
SEC. 1002A.INDIAN HEALTH SERVICE.
(a)Preservation. Nothing in this Act shall be construed to reduce or fundamentally alter the
provision of health services through the Indian Health Service or Tribal Health Organizations
under the Indian Self-Determination and Education Assistance Act.
(b)Option and reimbursement. Eligible American Indians and Alaska Natives may choose to
receive care through the Indian Health Service, the System, or both. The System shall reimburse
Indian Health Service facilities and Tribal Health Organizations for essential health services
furnished to members at 100 percent of the applicable rates established under section 402.
SEC. 1003.FEDERAL EMPLOYEE AND OTHER FEDERAL HEALTH PROGRAMS.
SEC. 1004.PRIVATE COVERAGE CONVERSION AND CERTIFICATION TRANSITION RULES.
(a)Conversion and certification.
(1)In general. Beginning on the date that membership becomes effective for an individual under the schedule in section 1005, coverage of essential health services for such individual may be provided only through certified plans under section 105.
(2)Transition for existing products. A private health insurer or health benefit plan that, before the main implementation date, provided basic health coverage may:
(A)apply for certification under section 105 to continue offering coverage for the essential benefit floor as a certified plan; or
(B)convert such product to supplemental coverage that complies with section 105(e).
(3)Prohibition on non certified basic coverage. A product that is not certified under section 105 may not be marketed, represented, or treated as satisfying coverage for the essential benefit floor for members.
(b)Continuity of treatment. The Secretary shall adopt rules so that individuals who are in the middle of treatment at the time of transition can continue that treatment without interruption, including through continuity of care requirements applied to certified plans and the Federal Standard Plan.
(c)Member protections. The Secretary shall establish a uniform process for member notices, plan mapping, and automatic transfers to prevent gaps in coverage during the transition, using the National Health Claims Data Platform.
SEC. 1005.PHASED IMPLEMENTATION SCHEDULE.
(a)Planning and buildout. The planning period shall begin on the date of enactment. The
Secretary shall complete key regulations, data systems, enrollment mechanisms, and provider
participation onboarding within 24 months after enactment.
(b)Phase 1, initial launch, year three after enactment. On January 1 of the third calendar
year after enactment:
(1)Automatic enrollment. Subject to readiness certification under section 303A, automatic
enrollment shall begin for:
(A)Individuals enrolled in Medicare, Medicaid, or the Children's Health Insurance Program.
(B)Individuals receiving premium subsidies or cost sharing reductions under the Patient
Protection and Affordable Care Act.
(C)Individuals identified as uninsured under Federal and State records, as determined by
the Secretary.
(D)Individuals who are age 55 or older.
(E)Individuals who are under age 18.
(2)Coverage effective. System coverage for essential health services shall become effective for
individuals described in paragraph (1).
(3)Contribution alignment. The employer and individual contributions under sections 202
and 203 shall take effect only with respect to wages paid to, and income of, individuals whose
System coverage is effective under this subsection.
(c)Phase 2, expansion, year five after enactment. On January 1 of the fifth calendar year
after enactment:
(1)Automatic enrollment. Subject to readiness certification under section 303A, automatic
enrollment shall expand to include:
(A)Individuals who are age 45 or older.
(B)Individuals who are age 18 through 25.
(2)Coverage and contributions. System coverage and contributions under sections 202 and
203 shall take effect for such newly enrolled individuals, consistent with subsection (b)(3).
(d)Phase 3, expansion, year six after enactment. On January 1 of the sixth calendar year
after enactment:
(1)Automatic enrollment. Subject to readiness certification under section 303A, automatic
enrollment shall expand to include:
(A)Individuals who are age 35 or older.
(B)Individuals who are age 26 through 34.
(2)Coverage and contributions. System coverage and contributions under sections 202 and
203 shall take effect for such newly enrolled individuals.
(e)Phase 4, full enrollment, year seven after enactment. On January 1 of the seventh
calendar year after enactment, automatic enrollment shall apply to all remaining legal
residents not previously enrolled, subject to readiness certification under section 303A. System
coverage and contributions shall take effect for all remaining individuals.
(f)Private coverage coordination.
(1)Individuals not yet enrolled under this section may maintain existing coverage
arrangements, including employer sponsored coverage, until their System coverage becomes
effective.
(2)As individuals become enrolled under this section, any private coverage that duplicates
essential health services shall be subject to section 105 prohibitions and the transition rules
in section 1004.
(g)Conforming operations. During the period beginning on the date described in subsection
(b)and ending on the date described in subsection (e), the Secretary shall scale integration,
payment policy, and program integrity operations in proportion to actual enrolled membership
and claims volume and shall prioritize continuity of treatment under section 1004(b).
SEC. 1006.STATE ADMINISTRATIVE COORDINATION PAYMENTS.
(a)[RESERVED]
(b)Condition on cooperation. As a condition of receiving a payment under this section, a State shall comply with data provision and cooperation requirements established by the Secretary to carry out section 302, including timely provision of data needed for automatic enrollment.
(c)Permissible uses. Amounts under this section may be used only for:
(1)secure information technology and interoperability.
(2)identity and eligibility matching support.
(3)enrollment assistance and outreach directly related to SAFECARE enrollment.
(4)cybersecurity and privacy controls.
(d)Funding. There are authorized to be appropriated from the SAFECARE Trust Fund such sums as may be necessary to carry out this section.
TITLE XI. GENERAL PROVISIONS.
TITLE XI—GENERAL PROVISIONS.
SEC. 1101.REGULATIONS.
SEC. 1102.SEVERABILITY.
SEC. 1103.EFFECTIVE DATES.
(a)General rule. Except as provided in subsection (b), this Act shall take effect on the date of
enactment.
(b)Main implementation date. The main implementation date for System operations, for purposes
of employer and individual contributions and coverage obligations, shall be January 1 of the
third calendar year that begins after the date of enactment. Employer and individual
contributions and coverage obligations shall apply on and after such date only with respect to
individuals whose System coverage is effective under the phased schedule in section 1005.
(c)Payroll tax replacement. On and after the main implementation date, the replacement of the
Hospital Insurance payroll tax described in section 205 shall apply.
(d)Full implementation date. The full implementation date for universal automatic enrollment
shall be January 1 of the seventh calendar year that begins after the date of enactment, as
provided in section 1005(e).
SEC. 1104.AMENDMENT TO INTERNAL REVENUE CODE FOR DATA SHARING.
SEC. 1105.PREVENTION OF UNINTENDED TAX BURDENS.
(a)Medical Debt Relief. Notwithstanding section 61(a)(11) of the Internal Revenue Code of 1986 or any other provision of law, the cancellation, discharge, or forgiveness of any debt under Title VII of this Act shall not be included in the gross income of the debtor for purposes of the Internal Revenue Code of 1986.
(b)Workforce Transition. Any loan forgiveness, debt retirement, or pension bridge payment provided under Title XII shall not be considered gross income for purposes of the Internal Revenue Code of 1986.
SEC. 1106.GIG ECONOMY FAIRNESS AND AGGREGATION.
(a)[RESERVED].
(b)Platform Aggregation. In the case of an individual who provides services through multiple digital on-demand platforms, the Secretary of the Treasury shall prescribe regulations to pro-rate the employer contribution among such platforms based on the gross receipts attributable to each, ensuring that no individual is forced to pay the employer share of the contribution solely because their income is fragmented across multiple sources.
SEC. 1107.STATE DATA SHARING INCENTIVES AND PENALTIES.
(a)Condition of Participation. As a condition of receiving Federal funds under title XIX of the Social Security Act (Medicaid) for administrative costs and of receiving payments under section 1006 of this Act, a State shall enter into a Data Exchange Agreement with the Secretary to provide timely eligibility and enrollment data for automatic enrollment purposes, consistent with privacy protections under this Act and other applicable Federal law.
(b)Notice and Opportunity to Cure.
(1)Notice. If the Secretary determines that a State has failed in a material respect to comply with subsection (a), the Secretary shall provide the State with written notice describing the specific deficiencies.
(2)Corrective action and cure period. The State shall have not less than 180 days from the date of such notice to submit and implement a corrective action plan acceptable to the Secretary.
(c)Proportionate Administrative Funding Withhold.
(1)In general. If, after the period described in subsection (b)(2), the Secretary determines that the State remains in material non-compliance with subsection (a), the Secretary may withhold a portion of Federal matching funds for State administrative costs under title XIX of the Social Security Act.
(2)Limits. Any withholding under paragraph (1)
(A)shall be limited to an amount that is reasonably calculated to encourage compliance with subsection (a)
(B)shall not exceed 5 percent of such administrative matching funds in the first 12-month period of withholding and shall not exceed 10 percent in any subsequent 12-month period
(C)shall not apply to Federal financial participation in medical assistance payments under title XIX.
(3)Restoration. Withheld amounts shall be restored upon a determination by the Secretary that the State has come into substantial compliance with subsection (a).
(d)Federal Bypass Authority. If the Secretary determines that a State remains in material non-compliance after application of subsection (c), the Secretary may contract directly with third-party vendors, claims clearinghouses, and health information exchanges operating within such State to acquire the necessary eligibility and enrollment data, notwithstanding any State law to the contrary, provided that such contracts comply with the privacy and security standards of this Act and other applicable Federal law.
(e)Preemption. Pursuant to the Supremacy Clause of the Constitution, any State law, regulation, or executive order that explicitly prohibits the sharing of health or income data with the SAFECARE System for the purpose of enrollment, in accordance with this section and with applicable privacy protections, is preempted and has no force or effect.
(f)Findings. Congress finds that
(1)the data exchange condition in this section is directly and substantially related to the efficient administration of Medicaid and the SAFECARE System
(2)nothing in this section requires any State to administer the SAFECARE System, and any State may decline payments under section 1006 or may prospectively alter participation in Medicaid as permitted by Federal law.
SEC. 1108.TRANSITION PERIOD OVERSIGHT (SPECIAL MASTER).
(a)Appointment. Effective immediately upon enactment, the Secretary shall appoint a Special Master for Certified Plan Transition and Platform Readiness.
(b)Powers. The Special Master shall have the authority to:
(1)monitor claims processing timeliness, denial rates, appeals outcomes, network adequacy, and Platform compliance for certified plans during the transition period described in section 1005;
(2)recommend corrective action. Upon determining that a certified plan or subcontractor is failing to meet prompt payment standards, access standards, or Platform requirements, the Special Master may recommend that the Secretary require a corrective action plan under section 105(f), including deadlines, reporting, and targeted audits;
(3)recommend supervision and sanctions. For material or repeated failures, the Special Master may recommend that the Secretary impose civil monetary penalties, transaction restrictions under section 801(g), temporary enrollment restrictions, or decertification under section 105(f), in a manner that prioritizes continuity of care for members;
(4)coordinate. The Special Master shall coordinate with State insurance regulators, State all payer entities where applicable, and other Federal agencies to minimize disruption of claims processing, to ensure continuity of care, and to prevent regulatory gaps; and
(5)publish transition readiness dashboards. The Special Master may publish aggregate public reports on transition readiness, including Platform performance, prompt pay metrics, and resolution timelines, in a manner that protects privacy and proprietary data.
(c)Due process. Any certified plan or subcontractor subject to enforcement action recommended under subsection (b) shall have the rights to notice, an opportunity to respond, and review procedures established by the Secretary under section 105(f) and section 801(g).
SEC. 1109.NARROW CONSCIENCE PROTECTIONS AND ACCESS GUARANTEES.
(a)Institutional and Individual Conscience. A participating provider or religious health facility may decline to perform or assist in a Directly Contested Service if such action violates a sincerely held religious or moral belief. Such declination shall not result in the termination of a Participation Agreement under section 401, provided the entity complies with the notice requirements in subsection (g) and the non-obstruction duties in subsection (c).
(b)Exhaustive List of Directly Contested Services. For purposes of this section, the term “Directly Contested Service” means only the following procedures, and no other item or service:
(1)Elective termination of pregnancy, except in cases involving the life or health of the mother, or fetal demise.
(2)Gender reassignment surgeries. For purposes of this section, “gender reassignment surgeries” means surgical procedures performed for the primary purpose of effecting a physical sex characteristic transition, including genital reconstruction procedures, gonadectomy, hysterectomy, oophorectomy, orchiectomy, phalloplasty, metoidioplasty, vaginoplasty, clitoroplasty, mastectomy when performed for transition purposes, breast augmentation when performed for transition purposes, and other comparable operative procedures billed or documented as transition-related.
For avoidance of doubt, “gender reassignment surgeries” does not include non-surgical care, including the prescribing, dispensing, continuation, discontinuation, dose adjustment, monitoring, or management of hormone therapy, puberty suppression therapy, counseling, psychotherapy, behavioral health services, routine primary care, specialty consults, laboratory testing, imaging, or the treatment of unrelated conditions.
(A)Coverage limitation for minors. Notwithstanding any other provision of this Act, gender reassignment surgeries are not a covered benefit for individuals under the age of majority applicable in the individual’s State of residence.
(B)Rule of construction. Nothing in this paragraph shall be construed to limit coverage for non-surgical care, including counseling, psychotherapy, behavioral health services, or the prescribing, dispensing, monitoring, or management of hormone therapy, when otherwise covered under the System’s general medical necessity and coverage rules.
(3)In vitro fertilization and related assisted reproductive technologies. For purposes of this section, this term includes services performed for the purpose of achieving pregnancy through assisted reproduction, including ovarian stimulation, oocyte retrieval, sperm retrieval when performed for assisted reproduction, fertilization including intracytoplasmic sperm injection, embryo creation and culture, embryo cryopreservation and storage, embryo transfer, and the handling, transport, or disposition of embryos as part of an assisted reproduction cycle. This term also includes medically related services integral to such procedures, including the use of donor gametes and medically related services for gestational carrier arrangements, when such services are part of the assisted reproduction process.
(4)Permanent sterilization procedures, including tubal ligations and vasectomies.
(c)Anti-Discrimination Firewall and Non-Obstruction Duties.
(1)Anti-Discrimination. Conscience protections shall not apply to, and the System shall strictly prohibit, any refusal of care based on a patient’s race, sex, sexual orientation, gender identity, religion, or status as a member.
(2)Emergency Stabilization and Non-Obstruction. Nothing in this section permits a participating facility or provider to refuse emergency stabilizing care. Emergency stabilizing care remains an absolute mandate for all participating facilities. Nothing in this section permits obstruction, delay, patient abandonment, or retaliation. A facility or provider that exercises an opt-out under subsection (a) shall, at minimum, do all of the following in a timely manner and in good faith:
(A)Provide accurate, clinically appropriate information about lawful options.
(B)Provide referral or navigation assistance that enables the member to obtain the service from an alternative provider.
(C)Provide prompt transfer of medical records upon request and without undue burden.
(D)Provide medically necessary follow-up care and treatment of complications, regardless of where the Directly Contested Service was furnished.
(d)Federal Procurement Access Bypass. To fulfill the Universal Entitlement under section 103, the Secretary shall utilize the Safety Net Care Fund to procure alternative access for members in service areas where a facility utilizes an opt-out under subsection (a) with respect to a Directly Contested Service.
(1)Proprietary Federal Contracts. The Secretary shall contract with alternative providers to deliver Directly Contested Services. Such providers shall be deemed Federal Contractors solely for the purpose of furnishing a federally funded benefit under this Act.
(2)Access Stabilization Vouchers. The Secretary shall provide vouchers to reimburse the member for reasonable travel and lodging costs to the nearest providing facility, regardless of State lines, when local access is not available due to an opt-out under subsection (a).
(3)Licensing non-retaliation for federally authorized services.
(A)In general. A State, or an agency or instrumentality of a State (including a State medical, nursing, pharmacy, or other professional licensing board), may not suspend, revoke, refuse to renew, reprimand, place on probation, impose a civil penalty on, restrict, or otherwise take adverse action with respect to a provider’s license, certificate, registration, or privilege to practice solely on the basis that the provider furnished a Directly Contested Service pursuant to and within the scope of a contract entered into under paragraph (1), as a federally funded benefit under this Act, and in material compliance with this Act and regulations issued by the Secretary.
(B)Rule of construction. Nothing in this paragraph shall be construed to limit State authority to impose discipline for negligence, incompetence, fraud, diversion, impairment, unprofessional conduct, failure to meet generally applicable standards of care, or other generally applicable grounds unrelated to the furnishing of a service described in subparagraph (A).
(C)Enforcement. A provider aggrieved by a violation of this paragraph may bring an action for declaratory or injunctive relief in an appropriate district court of the United States. The United States may intervene as of right. The court may award reasonable attorneys’ fees and costs to a prevailing provider.
(D)Clarification of scope. This paragraph applies only to adverse action taken solely because the provider furnished a service described in subparagraph (A).
(e)Tribal Sovereignty Coordination. Pursuant to section 1002A, the Secretary may enter into proprietary contracts with Tribal Health Organizations to provide Directly Contested Services on sovereign tribal lands.
(1)Exclusive Jurisdiction. Such services shall be furnished under the Tribe’s sovereign authority and the terms of the proprietary federal contract.
(2)Infrastructure Priority. Tribal facilities acting as regional hubs for Directly Contested Services shall receive priority for Essential Infrastructure Capital Grants under section 604.
(f)Federal Contracting, Voucher, and Licensing Litigation Protections. The purpose of this subsection is to ensure orderly administration of federally procured benefits and travel assistance under this Act.
(1)Covered Actions. This subsection applies to any civil action, and any administrative, licensing, credentialing, or disciplinary proceeding (whether commenced by a State, an agency or instrumentality of a State, or any person acting under color of State law), including any private civil enforcement action, that is based on, arises from, or is related to either of the following:
(A)A member’s receipt or use of an Access Stabilization Voucher under subsection (d)(2).
(B)A provider’s performance of a proprietary federal contract under subsection (d)(1), when acting within the scope of that contract, or the protections in subsection (d)(3).
(2)Federal Forum Election and Removal. In any Covered Action, the defendant may elect a federal forum. Upon such election, the action shall be removable to the appropriate United States district court. The election may be made by filing a notice of removal that states the action is a Covered Action under this subsection. Any Covered Action initiated as an administrative, licensing, credentialing, or disciplinary proceeding shall be treated as a civil action for purposes of removal under this paragraph, and the State tribunal shall stay the proceeding upon the filing of the notice of removal.
(3)Government Pays Removal Fees. The United States shall pay, or reimburse, any federal court filing fee required solely to effect removal under paragraph (2). Amounts used under this paragraph shall be paid from amounts available for administration and program integrity under this Act, and shall not be paid from funds used to furnish benefits.
(4)Automatic Discovery Stay. In any Covered Action, all discovery shall be stayed upon the filing of a notice of removal under paragraph (2) or upon the filing of a motion that asserts the federal defense in paragraph (5), and shall remain stayed until the court resolves that motion.
(5)Federal Defense and Expedited Disposition. In any Covered Action, it shall be a complete defense that the conduct at issue consisted of, or was necessary to, either of the following.
(A)Receipt or use of an Access Stabilization Voucher under subsection (d)(2) in accordance with rules issued by the Secretary.
(B)Performance of a proprietary federal contract under subsection (d)(1) within the scope of that contract, including furnishing services as a federally funded benefit under this Act, or conduct protected under subsection (d)(3).
The United States shall, upon request of the defendant, seek expedited consideration of any motion to dismiss based on this paragraph. The court shall treat such motions as priority matters to prevent harassment and cost shifting from being used to deter access to federally procured benefits.
(6)Mandatory Fee Shifting. If a defendant prevails in whole or in material part in a Covered Action by reason of the defense in paragraph (5), the court shall award the defendant reasonable attorneys’ fees and costs incurred in the action. The court may award additional fees and costs if it finds the action was brought to harass, to impose costs, or to deter access to federally procured benefits.
(g)Notice. A facility opting out under this section must provide 180 days’ notice to the Secretary to allow for the orderly deployment of the Federal Procurement Access Bypass under subsection (d). The Secretary may establish a shorter notice process for extraordinary circumstances, provided the facility complies with subsection (c).
(h)Pre-Awarded Defense Panel and Flat Fee Representation.
(1)Establishment. The Secretary shall establish a pre-awarded panel of qualified counsel to provide representation in Covered Actions for eligible members and eligible Federal Contractors under subsection (d)(1).
(2)Flat Fee Schedule. Contracts for such representation shall utilize standardized, fixed fee schedules for removal, threshold motions, and early disposition, with tightly limited exceptions for unusual complexity as defined by the Secretary.
(3)Eligibility. Representation under this subsection shall be available only when the member, provider, or facility acted in material compliance with this Act and applicable rules of the Secretary.
(i)Optional State Cooperation Incentive. The Secretary may provide additional administrative partnership funding to States that enact procedures facilitating the orderly administration of vouchers and federally procured services under this section, including confidentiality protections and timely verification processes. Nothing in this subsection shall reduce, delay, or condition any benefits for members, and nothing in this subsection shall reduce any infrastructure or capital funding otherwise available under this Act.
(j)Noncoverage of Assisted Suicide and Euthanasia. Notwithstanding any other provision of this Act, assisted suicide and euthanasia are not covered benefits under the System. Nothing in this section or this Act shall be construed to require the Secretary to procure, contract for, reimburse, or provide travel assistance for assisted suicide or euthanasia, or to require any participating provider or facility to perform or assist in such practices.
(k)Rule of Construction. Nothing in this section shall be construed to require any provider or facility to perform a Directly Contested Service. Nothing in this section shall be construed to require any State to amend its laws. The Secretary shall administer this section through voluntary participation conditions, federal procurement, and travel assistance to ensure access to federally funded benefits under this Act, and nothing in State law shall be construed to authorize adverse action in conflict with subsection (d)(3) or subsection (f).
SEC. 1110.CLINICAL INDEPENDENCE AND NON INTERFERENCE.
(a)Non interference. Nothing in this Act shall be construed to authorize any Federal officer or employee to supervise or control the practice of medicine or the manner in which medical services are provided.
(b)Savings clause. Nothing in this section limits the Secretary’s authority to establish coverage, payment, quality, safety, program integrity, or participation conditions under this Act.
SEC. 1111.EXCLUSIVE JUDICIAL REVIEW.
(a)Exclusive jurisdiction. Any action seeking judicial review of, or to enjoin, stay, or otherwise challenge, a final regulation issued by the Secretary under this Act shall be brought only in the United States Court of Appeals for the District of Columbia Circuit.
(b)Timing. A petition for review under subsection (a) shall be filed not later than 60 days after publication of the final regulation in the Federal Register.
(c)Standard. Review under this section shall be conducted under section 706(2)(A) of title 5, United States Code.
(d)Exclusive relief. No court other than the court described in subsection (a) may issue any order enjoining, staying, or otherwise restraining a final regulation under this Act.
(e)Savings clause. Nothing in this section limits review of an as applied challenge raised as a defense in an enforcement action brought by the United States.
SEC. 1112.WARRANT REQUIREMENT FOR COMPELLED DISCLOSURE FROM COMMINGLED DIGITAL REPOSITORIES CONTAINING MEDICAL DIGITAL INFORMATION.
(a)Findings and purpose.
(1)Congress finds that medical digital information is routinely stored and transmitted through general purpose electronic accounts and storage services used by individuals, including electronic mail and consumer cloud storage accounts.
(2)Congress finds that, because such repositories are commingled, separating medical digital information from non medical information generally requires review of contents, and compelled access to contents therefore creates a substantial risk of exposure of sensitive medical digital information beyond the scope of any investigation.
(3)Congress finds that confidentiality of medical communications promotes timely care seeking, accurate disclosure to clinicians, continuity of care, and adherence to treatment, and that warrantless or low threshold compelled access to commingled repositories chills patient communications, undermines trust, and can deter individuals from seeking medically necessary care.
(4)Purpose. The purpose of this section is to establish a minimum Federal standard requiring judicially authorized probable cause process for compelled disclosure of contents from commingled repositories that are reasonably likely to contain medical digital information, and to require minimization, notice, and remedies to prevent overcollection and misuse.
(b)Definitions.
(1)Medical digital information. The term medical digital information means any information in electronic form that relates to the past, present, or future physical or mental health or condition of an individual, the provision of health care to an individual, coverage for health care, eligibility, enrollment, diagnosis, treatment, medication, reproductive health, disability, mental health, payment for care, or any claim, appeal, denial, prior authorization, billing, or collection activity connected to health care, and that identifies the individual or is reasonably linkable to the individual.
(2)Covered commingled repository.
(A)In general. The term covered commingled repository means any electronic account, mailbox, stored communications repository, cloud storage space, backup, or similar repository maintained for a subscriber or customer that is reasonably likely to contain medical digital information.
(B)Presumption for general purpose accounts. A repository shall be presumed to be reasonably likely to contain medical digital information if it is a general purpose communications or storage account used by individuals, including email accounts and consumer cloud storage accounts.
(C)Rebuttal. The presumption in subparagraph (B) may be rebutted only upon a clear and convincing showing, supported by specific facts, that the repository is not used by or for an individual, or that it is restricted by design and practice to non personal, non commingled business records that are not reasonably likely to contain medical digital information.
(D)Objective indicators. In determining whether a repository is reasonably likely to contain medical digital information, a court may consider objective indicators, including whether the repository is associated with an individual subscriber, whether it contains attachments or documents commonly used for billing or insurance, whether it is used for scheduling, claims, payment, or reimbursement communications, or whether it is used for communications with providers, payers, pharmacies, laboratories, or caregiving services.
(3)Governmental entity. The term governmental entity means any Federal, State, local, or Tribal agency, department, officer, employee, or agent acting under color of law, including law enforcement agencies, regulatory bodies, and prosecutors.
(4)Provider. The term provider means a provider of electronic communication service or remote computing service, and any other custodian that maintains a covered commingled repository for a subscriber or customer.
(c)Warrant requirement for contents.
(1)In general. Notwithstanding section 2703 of title 18, United States Code, or any other provision of law, no governmental entity may compel a provider to disclose the contents of communications or stored content from a covered commingled repository unless the governmental entity obtains a warrant issued by a court of competent jurisdiction based on probable cause and particularly describing the information to be seized.
(2)Particularity and minimization. A warrant under paragraph (1) shall include reasonable particularity as to the account, repository, time period, and categories of content sought, and shall be subject to minimization procedures under subsection (d).
(d)Court supervised filter and minimization procedures.
(1)Required procedures. For any compelled disclosure under subsection (c), the court shall require a filter and minimization protocol sufficient to reduce exposure, retention, and dissemination of medical digital information outside the scope of the warrant.
(2)Execution. The protocol shall, at a minimum, require that review and extraction be executed by the provider or by an independent court appointed special master, and not by the governmental entity, unless the court makes specific findings that provider or special master execution is not feasible and that equivalent minimization safeguards will be applied.
(3)Segregation and sealing. Medical digital information that is not within the scope of the warrant shall be segregated and sealed, and shall not be provided to or reviewed by the governmental entity.
(4)Destruction. Sealed nonresponsive medical digital information shall be destroyed within a court specified period, not to exceed 90 days after production, unless the court finds by specific written findings that continued retention is necessary and narrowly tailored.
(e)No lesser process sufficient.
A subpoena, administrative demand, civil investigative demand, or court order that does not require probable cause shall not be sufficient to compel disclosure of contents from a covered commingled repository.
(f)Notice.
(1)In general. Unless delayed notice is authorized under paragraph (2), the governmental entity shall provide notice to the subscriber or customer not later than 30 days after disclosure.
(2)Delayed notice. A court may authorize delayed notice only upon specific findings that notice would materially endanger life or physical safety, risk destruction of evidence, or risk flight from prosecution. Any delay shall be time limited and subject to judicial renewal under standards comparable to those set forth in section 2705 of title 18, United States Code.
(g)Emergency exception.
(1)Imminent threat. A governmental entity may compel disclosure without a prior warrant only if the entity reasonably believes that disclosure is necessary to prevent an imminent threat to life or physical safety, and the compelled disclosure is limited to the minimum necessary to address the imminent threat.
(2)Follow up warrant application. Within 72 hours after compelling disclosure under paragraph (1), the governmental entity shall apply for a warrant under subsection (c) covering the information obtained.
(3)Denial, destruction, and suppression. If the court denies the application, all information obtained under paragraph (1), and any copies, shall be destroyed, and shall be inadmissible in any proceeding in a court of the United States, together with evidence derived therefrom.
(h)Application to international requests.
(1)Provider obligation. A provider subject to the jurisdiction of the United States shall not disclose contents from a covered commingled repository pursuant to any foreign government request, international agreement, treaty, or other cross border process, unless the disclosure complies with subsection (c) when the repository pertains to a United States person.
(2)United States person. The term United States person has the meaning given in section 101 of the Foreign Intelligence Surveillance Act of 1978 (50 U.S.C. 1801).
(i)Remedies.
(1)Suppression. Medical digital information obtained in material violation of this section, and evidence derived therefrom, shall be inadmissible in proceedings in a court of the United States.
(2)Civil action for equitable relief. Any subscriber or customer aggrieved by a material violation of this section may bring a civil action for declaratory or injunctive relief against the governmental entity. The United States waives sovereign immunity for actions under this paragraph seeking only declaratory or injunctive relief.
(3)Civil action against providers for unlawful disclosure. Any subscriber or customer aggrieved by an unlawful disclosure by a provider in violation of this section may bring a civil action for appropriate relief against the provider, including actual damages, statutory damages of not less than $1,000 per violation, punitive damages where appropriate, and reasonable attorney fees.
(j)Savings clause.
Nothing in this section shall be construed to preempt more protective State, local, or Tribal law relating to medical privacy or electronic communications. This section establishes a minimum Federal standard of protection.
(k)Severability.
If any provision of this section or its application to any person or circumstance is held invalid, the remainder of this section, and the application of such provision to other persons or circumstances, shall not be affected.
TITLE XII. WORKFORCE TRANSITION AND ECONOMIC STABILITY.
TITLE XII—WORKFORCE TRANSITION AND ECONOMIC STABILITY.
SEC. 1201.PURPOSE.
SEC. 1201A.CERTIFIED PLAN TRANSITION ASSESSMENT.
(a)Establishment. The Secretary shall establish within the Trust Fund a subaccount to be known as the Certified Plan Transition Subaccount, to finance the worker transition benefits and administrative capacity measures under this title.
(b)Assessment.
(1)In general. Beginning on the main implementation date and for each of the following 10 years, the Secretary shall impose on each certified plan an annual administrative assessment in an amount not to exceed 0.15 percent of total risk adjusted payments received by the plan under section 207A for the preceding payment year.
(2)Budget neutrality and anti pass through. The assessment under paragraph (1) shall be treated as an administrative expense subject to the administrative load cap under section 105(c)(1) and may not be imposed on members through premiums, fees, or cost sharing for essential health services.
(3)Deposits. Amounts collected under this subsection shall be deposited into the Certified Plan Transition Subaccount and shall be available without fiscal year limitation to carry out this title.
(c)Rule of construction. Nothing in this section shall be construed to require liquidation of private insurers. The purpose of the assessment is to fund transition supports from within capped system administrative budgets.
SEC. 1202.PRIORITY HIRING FOR ADMINISTRATIVE ROLES.
(a)Mandate. In filling administrative, claims processing, fraud detection, provider relations, and customer service positions for the SAFECARE System, the Secretary shall give priority hiring preference to qualified individuals who
(1)were employed by a private health insurer, health care clearinghouse, provider billing department, or pharmaceutical manufacturer as of the date of enactment, and
(2)have lost employment due to the implementation of this Act.
(3)Public program workforce continuity. Priority hiring under this subsection
shall be implemented in a manner that does not require involuntary termination,
demotion, or reduction in force of covered public program administrative workers
during the transition operations period, except for cause consistent with
applicable protections.
(4)Net new and replacement hiring rule. During the transition operations
period, priority hiring preference under this subsection shall apply to all net
new System administrative positions and to all replacement positions created by
retirements, voluntary separations, resignations, and transfers.
(5)Transition hiring targets. The Secretary shall establish a workforce
transition plan that includes measurable targets for hiring individuals
described in paragraph (1) into net new and replacement positions during the
transition operations period, with the goal of maximizing reemployment while
maintaining continuity of operations.
(b)Remote work preservation. To the maximum extent practicable, the Secretary shall structure System administration roles to allow displaced workers to perform duties remotely, minimizing the need for geographic relocation.
(c)Covered public program administrative workers.
(1)Definition. The term covered public program administrative worker means an
individual who, as of the date of enactment, is employed by a Federal agency, a
State agency, or a contractor supporting such agency, primarily to perform
administrative, claims, enrollment, eligibility, benefits, customer service,
provider relations, or program integrity functions for Medicare, Medicaid, the
Children's Health Insurance Program, the Veterans Health Administration,
TRICARE, or the Indian Health Service.
(2)Continuity of operations. The Secretary shall ensure continuity of
operations during the phased implementation schedule in section 1005 by
retaining and deploying covered public program administrative workers as needed
to support integration, runout, enrollment scaling, and claims volume scaling.
(d)Transition operations period.
(1)In general. The term transition operations period means the period beginning
on the date of enactment and ending on the date that is 2 years after the full
implementation date described in section 1103(d).
(2)No mass layoffs rule. During the transition operations period, the Secretary
shall not implement across the board staffing reductions for System
administration. Any workforce reductions shall prioritize voluntary separation,
early retirement, interagency transfers, retraining, and attrition before any
involuntary separation.
(3)Annual staffing plan. Not later than 180 days after enactment, and annually
thereafter through the transition operations period, the Secretary shall publish
an operational staffing plan that aligns staffing levels with enrolled
membership and claims volume scaling under section 1005(g).
SEC. 1203.ADMINISTRATIVE WORKFORCE RETRAINING AND EDUCATION DEBT RELIEF.
(a)Eligibility. Individuals described in section 1202(a) shall be eligible for the Grant and Service Scholarship Programs under Title V on the same basis as health professions students, provided they enroll in a program to become a direct care provider.
(b)Obsolete degree loan forgiveness, Federal and private.
(1)Targeted relief. This subsection applies only to individuals described in section 1202(a)(1) who held positions in insurance administration, claims processing, or medical coding. It shall not apply to pharmaceutical sales representatives.
(2)Federal loans. The Secretary of Education shall discharge the outstanding liability on any Federal student loan, including interest and principal, held by such an individual if the loan was used to obtain a degree or certificate specifically related to private health insurance administration or medical coding.
(3)Private education loan buyout authority.
(A)Authority. The Secretary is authorized to purchase and retire private education loans, as defined in section 140 of the Truth in Lending Act, owed by eligible individuals, provided such loans were used for degrees described in paragraph (2).
(B)Least cost acquisition. In purchasing such loans, the Secretary shall negotiate with lenders to acquire the debt at a discounted rate reflecting the diminished earning capacity of the borrower and the distress value of the asset. The purchase price shall not exceed the principal amount originally borrowed, minus any payments already made.
(C)Prohibition on windfalls. No payment under this subsection may be used to pay penalties, late fees, or accumulated interest in excess of the original principal.
(c)Tax treatment. Per section 503(d), any discharge or debt retirement under this section shall not be considered taxable income.
SEC. 1204.PENSION BRIDGE AND EARLY RETIREMENT.
(a)Bridge benefit. For any displaced worker described in section 1202(a)(1), excluding pharmaceutical sales representatives, who is age 55 or older at the time of displacement and who has worked in the industry for at least 10 years, the Secretary shall provide a temporary Pension Bridge Annuity equal to 70 percent of the individual's lost wages until the individual is eligible for full Social Security benefits.
(b)Funding. This benefit shall be funded through the Certified Plan Transition Subaccount established under section 1201A.
SEC. 1206.SAFECARE REGIONAL OPERATIONS HUBS.
(a)Establishment.
The Secretary shall establish Regional Operations Hubs to support System administration,
including member services, claims operations, provider relations, program integrity surge
capacity, and System digital operations coordination described in subsection (f).
(b)Siting priority.
In selecting hub locations, the Secretary shall prioritize metropolitan areas with high
concentrations of displaced private insurance administrative workers and related health
administration workers, available workforce and training capacity, and the potential to
materially improve local economic conditions and broaden durable support for national health
reform.
(c)Initial designated locations.
Not later than the main implementation date, the Secretary shall designate not fewer than 10
hubs. To the maximum extent practicable, and subject to availability of suitable facilities
and workforce readiness, the Secretary shall designate initial hubs in or near the following
metropolitan areas:
(1)Hartford, Connecticut.
(2)Minneapolis Saint Paul, Minnesota.
(3)New York City, New York.
(4)Philadelphia, Pennsylvania.
(5)Pittsburgh, Pennsylvania.
(6)Detroit, Michigan.
(7)St. Louis, Missouri.
(8)Kansas City, Missouri or Kansas.
(9)Dallas Fort Worth, Texas.
(10)Anchorage, Alaska.
The Secretary may designate additional hubs and satellite offices as needed to meet
operational demand and to support workforce transition goals.
(d)Reuse of existing office capacity.
To minimize cost and accelerate implementation, the Secretary shall, to the maximum extent
practicable, utilize existing commercially available office capacity in hub locations,
including space formerly used by private health insurers and related administrative
entities, through voluntary lease or purchase on market terms.
(e)Remote work consistency.
Nothing in this section shall be construed to limit section 1202(b). Hubs shall be
structured to support remote work and distributed teams.
(f)Digital operations, security coordination, and escalation.
(1)In general.
The Secretary shall establish within one or more hubs a 24 hour System Operations capability
that coordinates member support escalation, provider portal escalation, identity and access
escalation, incident communications, cybersecurity operations coordination, and release
coordination and change management for System systems.
(2)Workforce alignment.
In staffing and contracting for functions under paragraph (1), the Secretary shall implement
priority hiring for displaced workers under sections 1202 and 1203 and shall structure roles
to be comparable to private insurance administrative and customer operations roles to the
maximum extent practicable.
(3)Security and domestic control.
Functions under paragraph (1) shall be carried out in a manner consistent with section 808.
SEC. 1207.PUBLIC PROGRAM ADMINISTRATIVE WORKFORCE TRANSITION.
(a)Voluntary options only. The Secretary, in coordination with the Director of
the Office of Personnel Management, shall establish voluntary early retirement
and voluntary separation options for covered public program administrative
workers during the transition operations period, to reduce disruption while
maintaining continuity of operations.
(b)Eligibility and incentives. The Secretary may offer enhanced retirement
bridge support and voluntary separation payments for eligible individuals, under
rules specified by the Secretary, provided that participation is voluntary and
nondiscriminatory within similarly situated classifications.
(c)Interagency reassignment priority. Covered public program administrative
workers who are not retained in equivalent System roles shall receive priority
consideration for reassignment or transfer to other Federal or State roles with
compatible duties, including program integrity, benefits processing, and
customer service roles.
(d)Training and credential conversion. The Secretary shall provide targeted
training to enable covered public program administrative workers to transition
into System roles, program integrity roles, or other public service roles.
APPENDIX Z. CROSS REFERENCE MAP.
(1)Certified plans. Section 105 establishes certification, section 402 binds rates, section 801 binds Platform, section 207A governs risk adjustment.
(2)Payments. Section 402 sets rates and methods, section 403 enforces unified billing, section 801 routes payments.
(3)Enrollment. Section 302 assigns default enrollment, section 105 requires certified plan compliance, section 303 and 303F govern records and interoperability.
(4)Worker dividend. Section 202(f) requires maintenance of total compensation, enforcement is coordinated with title XI labor and audit tools.
(5)Rural and Alaska. Section 402(f) sets formula add ons, section 303C sets readiness guarantees, section 604 and title VI support safety net capacity.
APPENDIX A. PUBLIC USE DATA RELEASE PACKAGE AND DEMOGRAPHIC REPORTING.
(a)Purpose.
The purpose of this Appendix is to specify minimum public use data products and reporting requirements that enable rigorous independent analysis of System and certified plan performance and integrity without creating a meaningful risk of identifying individual members.
(b)Public use data products required.
Not later than the first full calendar quarter after commencement of claims payments under title IV, and quarterly thereafter unless otherwise specified, the Secretary shall publish the following public use data products, subject to the disclosure controls in section 303A(f)(3).
(1)Utilization and spending public use file, quarterly.
(A)Unit of observation. Aggregated counts and rates by month and by county or Secretary defined public use area.
(B)Required dimensions. Service category, place of service, provider specialty group, member age group, and core demographic strata as feasible.
(C)Required measures. Allowed amount, paid amount, member cost sharing amounts where applicable, utilization counts, and per member per month measures.
(2)Claims processing and payment timeliness, quarterly.
(A)Required measures. Clean claim payment timeliness distributions, denial rates, pended claim rates, appeal volumes, reversal rates, and median days to payment.
(B)Stratification. Provider type, geography, and claim type categories.
(3)Prior authorization and utilization management, quarterly.
(A)Required measures. Prior authorization request volumes, approval rates, denial rates, median decision time, expedited decision compliance, appeal rates, and reversal rates.
(B)Stratification. Service category, provider type, and geography.
(4)Network adequacy and access, quarterly.
(A)Provider directory snapshot. Counts of participating providers by specialty group and geography, including acceptance of new patients where available.
(B)Access measures. Appointment availability measures and travel time proxies where available, and the readiness measures required under section 303C where applicable.
(5)Quality and outcomes measures, annually.
(A)Required measures. A defined set of evidence based quality measures and outcomes measures selected by the Secretary with public notice, including preventive care, chronic disease control, maternal and newborn measures, avoidable hospitalizations, and patient safety indicators where feasible.
(B)Stratification. Geography and core demographic strata, subject to suppression rules.
(6)Program integrity and enforcement actions, quarterly.
(A)Required measures. Counts and dollar amounts of confirmed fraud recoveries, recoupments, exclusions, civil penalties, and referrals, categorized by program area.
(B)Limitations. No public release may include case level narratives or details that could identify individual members or reveal active investigative techniques.
(7)Rate and methodology transparency, annually and upon material updates.
The Secretary shall publish national fee schedules, methodology summaries, and major policy changes affecting payment, including rural and frontier add ons and corridor multipliers, with effective dates and cross references to relevant sections of this Act.
(c)Minimum field definitions and code lists.
For each data product, the Secretary shall publish a data dictionary and code lists that include at minimum definitions for service category groupers, place of service groupers, provider specialty groupers, geography groupers, and any risk adjustment or standardization methods used.
(d)Required disclosure controls.
The Secretary shall apply all of the following controls to public releases under this Appendix, in addition to any other safeguards deemed necessary:
(1)minimum cell size thresholds not less than 11, with higher thresholds for rare conditions or small geographies,
(2)suppression of small cells and complementary suppression where necessary,
(3)top coding of extreme values,
(4)date coarsening to month and year unless a safer granularity is determined,
(5)geography coarsening to county or larger public use areas for microdata,
(6)removal of any direct identifiers and any stable unique identifiers that could be used to track an individual across releases,
(7)controlled noise or random rounding where necessary to protect privacy without materially distorting population level inference.
(e)HMDA style demographic reporting rule.
(1)In general. The demographic collection and reporting requirements under section 303A(g) shall be implemented in a manner similar in concept to public demographic reporting regimes that enable detection of disparate impacts, including periodic publication of key decision and outcome metrics stratified by demographic groups and geography.
(2)Covered metrics. At minimum, the Secretary shall include, subject to disclosure controls, demographic stratifications for denial rates, appeal rates, reversal rates, prior authorization outcomes, appointment access measures, and selected quality and outcome measures.
(3)Member choice and protections. Members shall be permitted to decline to provide self identified demographic data. Such declinations shall be recorded as unknown. No adverse action may be taken based on a member's decision to decline.
(f)Enforcement and updates.
(1)Enforcement. The Secretary may issue regulations to implement this Appendix and may enforce the prohibition on reidentification and misuse described in section 303A(f)(3)(D).
(2)Updates. The Secretary may update the contents of the public use data products by regulation to improve analytic value, provided that updates may not reduce the minimum scope required by subsection (b) and may not weaken the disclosure controls in subsection (d).
TITLE XIII. INTERNAL REVENUE CODE AND FEDERAL PROGRAM CONFORMING AMENDMENTS.
TITLE XIII—INTERNAL REVENUE CODE AND FEDERAL PROGRAM CONFORMING AMENDMENTS.
SEC. 1301.SHORT TITLE.
SEC. 1302.FINDINGS.
(1)Sections 202 and 203 of this Act were originally drafted as freestanding contribution provisions to finance universal essential coverage under the SAFECARE Plan.
(2)To remove ambiguity regarding constitutional basis, enforcement authority, collection mechanisms, and judicial review procedures for the national health contributions, it is necessary to codify the contribution taxes directly in the Internal Revenue Code of 1986 and to align those provisions with existing Federal tax administration.
(3)The Federal Employees Health Benefits Program under chapter 89 of title 5, United States Code, and the Veterans Health Administration and related veterans medical care authorities under chapter 17 of title 38, United States Code, will interact with the SAFECARE Plan upon implementation.
(4)Direct statutory amendments to those Federal program statutes will clarify coordination and continuity, reduce litigation risk, and preserve benefits and protections Congress intends for Federal employees, annuitants, and veterans.
(5)These amendments are necessary to ensure efficient administration, to protect the integrity of the SAFECARE Trust Fund, and to preserve continuity for affected beneficiaries.
SEC. 1303.INTERNAL REVENUE CODE AMENDMENTS.
(a)Employer national health contribution.
(1)In general. Section 3111 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:
"(g) National Health Employer Contribution.
"(1) In general. In addition to the tax imposed by subsections (a), (b), and (e), there is hereby imposed on every employer a tax equal to the applicable employer rate (as defined in paragraph (2)) of the wages (as defined in section 3121(a)) paid by the employer with respect to employment (as defined in section 3121(b)).
"(2) Applicable employer rate. The term 'applicable employer rate' means the applicable National Health Employer Contribution rate determined under sections 202(b) and 202(c) of the Secure Affordable Federal Essential Care Act, as adjusted under section 206 of such Act.
"(3) Applicability. This subsection shall apply only with respect to wages paid for payroll periods for individuals with respect to whom the National Health Individual Contribution under section 203 of the Secure Affordable Federal Essential Care Act is in effect under section 303(c) of such Act.
"(4) Covered contract remuneration. In the case of covered contract remuneration (as defined in section 202(e)(2) of the Secure Affordable Federal Essential Care Act), the person making such payment shall be treated as the employer and such payment shall be treated as wages for purposes of this subsection.
"(5) Manner of collection. The tax imposed by this subsection shall be collected in the same manner as the taxes imposed by this section."
(2)Clerical amendment. The table of subsections for section 3111 is amended by adding at the end the following new item:
"(g) National Health employer contribution."
(b)National health individual contribution.—
(1)In general.—Subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 59A the following new section:
"SEC. 59B. IMPOSITION OF NATIONAL HEALTH INDIVIDUAL CONTRIBUTION AND RECONCILIATION."
"(a) In general.—There is hereby imposed on the income of every individual a tax equal to the individual health contribution for the taxable year."
"(b) Individual health contribution.—For purposes of this section, the term ‘individual health contribution’ means the sum of—
"(1) the base contribution amount determined under section 203 of the Secure Affordable Federal Essential Care Act, and
"(2) the additional surtax amount determined under section 203 of such Act."
"(c) Coordination with withholding and payments.—The tax imposed by this section shall be paid through withholding under section 3402(u), estimated tax payments under section 6654, and reconciliation on the taxpayer’s annual return."
"(d) Regulations.—The Secretary shall prescribe such regulations as may be necessary to carry out this section, including rules to credit amounts withheld under section 3402(u) and amounts paid under section 1401(d) against the tax imposed by this section, and to prevent duplication."
(2)Clerical amendment.—The table of sections for subchapter A of chapter 1 is amended by inserting after the item relating to section 59A the following new item:
"Sec. 59B. Imposition of national health individual contribution and reconciliation."
(c)Withholding on wages for national health individual contribution.
(1)In general. Section 3402 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:
"(u) Withholding for National Health Individual Contribution.
"(1) In general. In the case of wages paid to an employee for any payroll period for which the National Health Individual Contribution under section 203 of the Secure Affordable Federal Essential Care Act is in effect for such employee under section 303(c) of such Act, the employer shall deduct and withhold from such wages an amount equal to the base individual rate under section 203(c)(1) of such Act (as adjusted under section 206 of such Act) of such wages.
"(2) Deposit and payment. Amounts required to be withheld under paragraph (1) shall be treated as amounts required to be deducted and withheld under this chapter and shall be deposited and paid in the same manner as amounts withheld under subsection (a).
"(3) Regulations. The Secretary shall prescribe such regulations as may be necessary to carry out this subsection, including rules for coordination where an employee's National Health Individual Contribution is effective for only part of a payroll period."
(2)Clerical amendment. The table of subsections for section 3402 is amended by adding at the end the following new item:
"(u) Withholding for National Health Individual Contribution."
SEC. 1304.AMENDMENTS TO FEDERAL EMPLOYEES HEALTH BENEFITS STATUTE.
(a)In general. Chapter 89 of title 5, United States Code, is amended by inserting after section 8914 the following:
"§ 8914a. FEHB coordination with the SAFECARE System
"(a) Coordination rule. Beginning on the main implementation date (as defined in section 1103(b) of the Secure Affordable Federal Essential Care Act), an individual eligible for coverage under this chapter who is enrolled in the SAFECARE System shall not be eligible to enroll in a health benefits plan under this chapter for any period for which such SAFECARE enrollment is effective.
"(b) Treatment of Government contributions.
"(1) Federal employees. The Government contribution that would otherwise have been paid under section 8906 with respect to an employee described in subsection (a) shall be treated as compensation and paid to such employee as additional wages, except as otherwise provided by the Secure Affordable Federal Essential Care Act.
"(2) Annuitants. The Government contribution that would otherwise have been paid under section 8906 with respect to an annuitant described in subsection (a) shall be treated as part of the annuitant's monthly annuity payment.
"(c) Supplemental benefits. Nothing in this section prohibits OPM from offering optional supplemental benefits that do not duplicate benefits under the SAFECARE System, including dental, vision, and supplemental hospitalization coverage, on an enrollee pay all basis.
"(d) Regulations. The Office of Personnel Management shall prescribe such regulations as may be necessary to carry out this section, including rules for continuity of care, payroll administration, and coordination with collective bargaining agreements to the extent consistent with law.".
(b)Clerical amendment. The table of sections at the beginning of chapter 89 of title 5, United States Code, is amended by adding at the end the following new item:
"8914a. FEHB coordination with the SAFECARE System."
SEC. 1305.AMENDMENTS TO VETERANS HEALTH CARE STATUTE.
(a)In general. Chapter 17 of title 38, United States Code, is amended by inserting after section 1787 the following new section:
"§ 1787A. Veterans Health Administration coordination with the SAFECARE System
"(a) Preservation of Veterans Health Administration. Nothing in the Secure Affordable Federal Essential Care Act shall be construed to reduce or eliminate eligibility for care and services furnished by the Veterans Health Administration, including for service connected conditions and specialized veterans programs.
"(b) Coordination rule. Beginning on the main implementation date (as defined in section 1103(b) of the Secure Affordable Federal Essential Care Act), the Secretary of Veterans Affairs shall coordinate benefits furnished under this chapter with the SAFECARE System to avoid duplication of payment while preserving access and continuity of care.
"(c) Provider and payment coordination. The Secretary may enter into agreements with the SAFECARE System Administrator to provide for claims coordination, data exchange, and payment methodologies for non service connected care furnished to veterans who are enrolled in the SAFECARE System.
"(d) Regulations. The Secretary shall prescribe such regulations as may be necessary to carry out this section, including rules for continuity of care and for veterans who reside in areas with limited provider access.".
(b)Dual access.
A veteran who is eligible to receive hospital care or medical services under this chapter and who is eligible for coverage under the SAFECARE Plan shall have access to care through both systems, and may choose, on an episode by episode basis, whether to seek care through the Department of Veterans Affairs or through a participating provider under the SAFECARE Plan, subject to eligibility and medical necessity criteria applicable to the chosen system.
(c)Clerical amendment. The table of sections at the beginning of chapter 17 of title 38, United States Code, is amended by inserting after the item relating to section 1787 the following new item:
"1787A. Veterans Health Administration coordination with the SAFECARE System."
SEC. 1306.DEPOSITS.
SEC. 1307.EFFECTIVE DATE.
(a)In general. Except as otherwise provided, the amendments made by this title shall take effect on the main implementation date (as defined in section 1103(b) of this Act).
(b)Tax provisions. The amendments made by section 1303 shall apply with respect to remuneration paid after, and taxable years beginning after, the main implementation date.
(c)Federal program provisions. The amendments made by sections 1304 and 1305 shall apply to periods of coverage beginning on or after the main implementation date.
TITLE XIV—LONG-TERM CARE INSURANCE MODERNIZATION.
SEC. 1401.ACTIVATION.
(a)Activation requirement.
This title, except for sections 1407 and 1408, shall take effect only upon enactment of a subsequent Act of Congress that explicitly activates this title by citation to this section. Until such activation, this title shall have no legal effect and shall not be construed to create any right, obligation, benefit, entitlement, contribution, or liability. Sections 1407 and 1408 are operative upon enactment of this Act.
(b)No budgetary effect prior to activation.
Prior to activation under subsection (a), this title:
(1)creates no budget authority and establishes no mandatory or discretionary spending;
(2)establishes no revenue provision and imposes no contribution, tax, or levy;
(3)shall not be construed to have any budgetary effect for purposes of the Congressional Budget Act of 1974 (2 U.S.C. 621 et seq.) or any concurrent resolution on the budget; and
(4)shall be disregarded for purposes of any CBO score, OMB baseline, or pay-as-you-go calculation under the Statutory Pay-As-You-Go Act of 2010 (2 U.S.C. 931 et seq.) until the effective date of an activating Act of Congress under subsection (a).
SEC. 1402.PURPOSE.
SEC. 1403.LTC INSURANCE PROGRAM.
(a)Establishment.
Upon activation, there is established within the System a Long-Term Care Insurance Program (in this title referred to as the "LTC Insurance Program").
(b)Fund redesignation.
Upon activation, the LTSS Sub-Account established under section 201(d) shall be redesignated as the LTC Insurance Fund and shall be governed by this title and the activating Act of Congress.
(c)Continuity.
Members receiving LTSS under section 104(a)(13) at the time of activation shall continue to receive covered services without interruption under transition rules specified by the Secretary in regulations.
SEC. 1404.CONTRIBUTIONS.
(a)Dedicated contribution.
Upon activation, a dedicated LTC Insurance Contribution shall be imposed as specified in the activating Act of Congress to fund the LTC Insurance Program, at a rate and structure consistent with the actuarial recommendations of the LTSS Commission under section 1407.
(b)Age-based structure.
The activating Act of Congress may provide that contributions begin at age 40, with low-income offsets and phase-in schedules as recommended by the LTSS Commission.
(c)Coordination.
Contributions under this section shall be coordinated with contributions under sections 202 and 203 to avoid duplicative obligations.
SEC. 1405.BENEFIT SCHEDULE.
SEC. 1406.ENROLLMENT.
(a)In general.
Upon activation, enrollment shall be as specified in the activating Act of Congress, and shall preserve existing member rights under section 104(a)(13) through the transition period.
(b)Default architecture.
The Secretary shall design enrollment to be automatic with opt out rights, consistent with the System's default enrollment architecture under section 302.
SEC. 1407.LTSS COMMISSION.
(a)Establishment.
There is established a Long-Term Services and Supports Commission (in this section referred to as the "Commission").
(b)Membership.
The Commission shall include the Secretary or designee, the Chief Actuary of the Centers for Medicare and Medicaid Services, representatives of members, providers, disability and aging advocates, State representatives, and not fewer than 3 independent actuarial experts.
(c)Duties.
The Commission shall:
(1)study comparable national long-term care insurance systems, including systems operating in Japan, Germany, the Netherlands, and South Korea, with specific focus on contribution structure, benefit schedule, solvency mechanisms, and portability;
(2)develop actuarial modeling, contribution rate options, and benefit schedule options for an LTC Insurance Program under this title, calibrated to the Trust Fund structure established under title II; and
(3)not later than 2 years after enactment, submit to Congress and the Secretary a final package consisting of:
(A)complete legislative text ready for adoption as an activating Act of Congress under section 1401;
(B)actuarial certification of the proposed benefit schedule and contribution rates;
(C)low-income offset and phase-in schedule recommendations; and
(D)a transition plan for redesignating the LTSS Sub-Account under section 201(d) as the LTC Insurance Fund.
(d)Fast-track procedure.
(1)In general.
Upon submission of the final package under subsection (c)(3), any Member of Congress may introduce a bill incorporating the package without amendment. Such a bill shall be referred to the Committee on Energy and Commerce and the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate and shall receive expedited floor consideration under procedures established by the respective Houses not later than 90 days after introduction.
(2)Constitutional rulemaking clause.
The provisions of paragraph (1) relating to expedited floor consideration are enacted as an exercise of the rulemaking power of the Senate and the House of Representatives, respectively, and as such they are deemed a part of the rules of each House, respectively, but applicable only with respect to the procedure to be followed in that House in the case of a bill described in paragraph (1). Each House may change such rules at any time, in the same manner, and to the same extent as in the case of any other rule of that House. To the extent that such rules conflict with other rules of the applicable House, the rules of the applicable House shall govern.
SEC. 1408.RULE OF CONSTRUCTION.
(1)create any right, entitlement, or benefit under Federal law;
(2)alter the essential health services entitlement under section 103(a);
(3)alter LTSS benefits provided under section 104(a)(13); or
(4)impose any contribution, tax, or obligation on any person.