PPACA Sec. 1002-04

(Back to HRN 2010 Ins Chart)

Part C of title XXVII of the Public Health Service Act (42 U.S.C. 300gg–91 et seq.) is amended by adding at the end the following:


‘‘(a) IN GENERAL.—The Secretary shall award grants to States to enable such States (or the Exchanges operating in such States) to establish, expand, or provide support for—

‘‘(1) offices of health insurance consumer assistance; or

‘‘(2) health insurance ombudsman programs.


‘‘(1) IN GENERAL.—To be eligible to receive a grant, a State shall designate an independent office of health insurance consumer assistance, or an ombudsman, that, directly or in coordination with State health insurance regulators and consumer assistance organizations, receives and responds to inquiries and complaints concerning health insurance coverage with respect to Federal health insurance requirements and

under State law.

‘‘(2) CRITERIA.—A State that receives a grant under this section shall comply with criteria established by the Secretary for carrying out activities under such grant.

‘‘(c) DUTIES.—The office of health insurance consumer assistance or health insurance ombudsman shall—

‘‘(1) assist with the filing of complaints and appeals, including filing appeals with the internal appeal or grievance process of the group health plan or health insurance issuer involved and providing information about the external appeal process;

‘‘(2) collect, track, and quantify problems and inquiries encountered by consumers;

‘‘(3) educate consumers on their rights and responsibilities with respect to group health plans and health insurance coverage;

‘‘(4) assist consumers with enrollment in a group health plan or health insurance coverage by providing information, referral, and assistance; and

‘‘(5) resolve problems with obtaining premium tax credits under section 36B of the Internal Revenue Code of 1986.

‘‘(d) DATA COLLECTION.—As a condition of receiving a grant under subsection (a), an office of health insurance consumer assistance or ombudsman program shall be required to collect and report data to the Secretary on the types of problems and inquiries encountered by consumers. The Secretary shall utilize such data to identify areas where more enforcement action is necessary and shall share such information with State insurance regulators, the Secretary of Labor, and the Secretary of the Treasury for use in the enforcement activities of such agencies.

‘‘(e) FUNDING.—

‘‘(1) INITIAL FUNDING.—There is hereby appropriated to the Secretary, out of any funds in the Treasury not otherwise appropriated, $30,000,000 for the first fiscal year for which this section applies to carry out this section. Such amount shall remain available without fiscal year limitation.

‘‘(2) AUTHORIZATION FOR SUBSEQUENT YEARS.—There is authorized to be appropriated to the Secretary for each fiscal year following the fiscal year described in paragraph (1), such sums as may be necessary to carry out this section.’’.

(Back to HRN 2010 Ins Chart)

Part C of title XXVII of the Public Health Service Act (42
U.S.C. 300gg–91 et seq.), as amended by section 1002, is further amended by adding at the end the following:


‘‘(1) IN GENERAL.—The Secretary, in conjunction with States, shall establish a process for the annual review, beginning with the 2010 plan year and subject to subsection (b)(2)(A), of unreasonable increases in premiums for health insurance coverage.

‘‘(2) JUSTIFICATION AND DISCLOSURE.—The process established under paragraph (1) shall require health insurance issuers to submit to the Secretary and the relevant State a justification for an unreasonable premium increase prior to the implementation of the increase. Such issuers shall prominently

post such information on their Internet websites. The Secretary shall ensure the public disclosure of information on such increases and justifications for all health insurance issuers.



As a condition of receiving a grant under subsection (c)(1), a State, through its Commissioner of Insurance, shall— ‘‘(A) provide the Secretary with information about trends in premium increases in health insurance coverage in premium rating areas in the State; and

‘‘(B) make recommendations, as appropriate, to the State Exchange about whether particular health insurance issuers should be excluded from participation in the Exchange based on a pattern or practice of excessive or unjustified premium increases.


‘‘(A) IN GENERAL.—Beginning with plan years beginning in 2014, the Secretary, in conjunction with the States and consistent with the provisions of subsection (a)(2), shall monitor premium increases of health insurance coverage offered through an Exchange and outside of an Exchange.

‘‘(B) CONSIDERATION IN OPENING EXCHANGE.—In determining under section 1312(f)(2)(B) of the Patient Protection and Affordable Care Act whether to offer qualified health plans in the large group market through an Exchange, the State shall take into account any excess of premium

growth outside of the Exchange as compared to the rate of such growth inside the Exchange.


‘‘(1) PREMIUM REVIEW GRANTS DURING 2010 THROUGH 2014.— The Secretary shall carry out a program to award grants to States during the 5-year period beginning with fiscal year 2010 to assist such States in carrying out subsection (a), including—

‘‘(A) in reviewing and, if appropriate under State law, approving premium increases for health insurance coverage; and

‘‘(B) in providing information and recommendations to the Secretary under subsection (b)(1).

‘‘(2) FUNDING.—

‘‘(A) IN GENERAL.—Out of all funds in the Treasury not otherwise appropriated, there are appropriated to the Secretary $250,000,000, to be available for expenditure for grants under paragraph (1) and subparagraph (B).

‘‘(B) FURTHER AVAILABILITY FOR INSURANCE REFORM AND CONSUMER PROTECTION.—If the amounts appropriated under subparagraph (A) are not fully obligated under

grants under paragraph (1) by the end of fiscal year 2014, any remaining funds shall remain available to the Secretary for grants to States for planning and implementing the insurance reforms and consumer protections under part A.

‘‘(C) ALLOCATION.—The Secretary shall establish a formula for determining the amount of any grant to a State under this subsection. Under such formula—

‘‘(i) the Secretary shall consider the number of plans of health insurance coverage offered in each State and the population of the State; and

‘‘(ii) no State qualifying for a grant under paragraph (1) shall receive less than $1,000,000, or more than $5,000,000 for a grant year.’’.

 The Effective Date of the PPACA Group Health Reforms

Section 1004 of the PPACA set an effective date of the first plan year beginning six months after the date of enactment or January 1, 2011 for calendar year plans. However, Section 1251(d) had an extended effective date for plan coverage tied to CBAs. This extended date is the date the last CBA relating to coverage terminates. But, reading that Section in light of the amendments made by the reconciliation bill and the definitions in the PPACA supported the conclusions that the delayed CBA effective date applied only to insured CBA plans. The path to this conclusion involves looking at the definitions of the PHSA Section 2791 which are incorporated into Title I (Sections 1001-1563) of the PPACA by PPACA Section 1301.


Pay or Play

The employer “pay or play” rules (i.e. offer coverage or pay a fee) don’t take effect until January 1, 2014.


(a) IN GENERAL.—Except as provided for in subsection (b), this subtitle (and the amendments made by this subtitle) shall become effective for plan years beginning on or after the date that is 6 months after the date of enactment of this Act, except that the amendments made by sections 1002 and 1003 shall become

effective for fiscal years beginning with fiscal year 2010.

(b) SPECIAL RULE.—The amendments made by sections 1002 and 1003 shall take effect on the date of enactment of this Act.