(a) Short title.—This Act may be cited as the “Fair Care Act of 2019”.

(b) Table of contents.—The table of contents for this Act is as follows:

Sec. 1. Short title; table of contents.

(a) Establishment.—Not later than January 1, 2021, the Secretary of Health and Human Services shall establish the Invisible High Risk Pool Reinsurance Program (in this section referred to as the “IHRPR program”).

(b) State grants.—Under the IHRPR program, the Secretary shall, from amounts appropriated under subsection (f) for a fiscal year, award grants to States for such fiscal year, in amounts determined in accordance with the allocation methodology specified under subsection (d). Such grants shall be used for the purpose of establishing or maintaining a qualifying invisible high risk pool for the State.

(c) Federal default.—

(1) IN GENERAL.—In the case of a State that does not, by a date and in a manner specified by the Secretary, choose to be awarded a grant under subsection (b) for a fiscal year to operate a qualifying invisible high risk pool for the State, the Secretary shall, from amounts appropriated under subsection (f) for such fiscal year, use the allocation determined for the State under subsection (d) for participation of such State in the Federal default qualifying invisible high risk pool described in paragraph (2).

(2) FEDERAL DEFAULT QUALIFYING INVISIBLE HIGH RISK POOL.—The Federal default qualifying high risk pool is, with respect to each State that chooses not to be awarded a grant under subsection (b) with respect to a fiscal year for which funds are appropriated under subsection (f), an invisible high risk pool under which health insurance issuers participating in the Exchange of such a State, with respect to designated individuals who are enrolled in health insurance coverage and are expected to experience higher than average health costs as determined by the insurer, cede risk to the pool, without affecting the premium paid by the designated individuals or their terms of coverage. With respect to such pool—

(A) high-risk individuals designated for cession to the pool shall be designated by the ceding issuer;

(B) the premium amount the ceding issuer shall pay to the reinsurance pool shall be 90 percent of the premium paid to the issuer for the coverage;

(C) the ceding issuer shall retain the same risk under the ceded policies as under any other policy of the issuer with respect to the first $10,000 of benefits for each ceded policy involved and will not retain any risk under ceded policies after such first $10,000 of benefits; and

(D) after a ceding issuer, with respect to a ceded policy, no longer retains risk under such policy pursuant to subparagraph (C), the negotiated rate under such policy for items and services shall be payable at the reimbursement rate under the Medicare program under title XVIII of the Social Security Act for such items and services, or in the case of items and services for which payment is available under the policy but not the Medicare program, at a rate determined by the Secretary.

(d) Allocation methodology.—Not later than June 30, 2020, the Secretary shall specify an allocation methodology for determining the amount of funds appropriated under subsection (f) for a fiscal year to be allocated for each State for purposes of subsections (b) and (c). Such methodology shall be based on the number of residents of each State and the general health status of such residents.

(e) Qualifying invisible high risk pool.—For purposes of this section, the term “qualifying invisible high risk pool” means, with respect to a State, a method of designation under which health insurance issuers identify individuals who experience higher than average health costs as determined by the State and are enrolled in health insurance coverage offered in the individual market, and cede the risk of spending more than $10,000 on health care services for a single individual to the pool without affecting the premium paid by the designated individuals or their terms of coverage. With respect to such pool, the State, or an entity operating the pool on behalf of the State, shall establish—

(1) the premium amount the ceding issuer shall pay to the reinsurance pool;

(2) the applicable attachment points or coinsurance percentages if the ceding issuer retains any portion of the risk under ceded policies, except that the provisions of subparagraphs (C) and (D) of subsection (c)(2) shall apply to such high risk pool in the same manner as such clauses apply to the Federal default high risk pool; and

(3) the mechanism by which high-risk individuals are designated for cession to the pool, which may include a list of designated high-cost health conditions.

(f) Appropriations.—There is appropriated to the Secretary of Health and Human Services $200,000,000,000 to carry out this section for the period of fiscal year 2020 through fiscal year 2029.

(g) Tax on health insurance plans sold on exchanges.—

(1) IN GENERAL.—Chapter 34 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subchapter:

“Sec. 4401. Additional tax on health insurance plans sold by insurers offering plans on exchanges.

(2) CONFORMING AMENDMENT.—The table of subchapters for chapter 34 of the Internal Revenue Code of 1986 is amended by adding at the end the following item:

(3) EFFECTIVE DATE.—The amendments made by this subsection shall apply with respect to months beginning after the date of enactment of this Act.

Section 2701(a)(1)(A)(iii) of the Public Health Service Act (42 U.S.C. 300gg(a)(1)(A)(iii)) is amended by inserting after “(consistent with section 2707(c))” the following: “or, for plan years beginning on or after January 1, 2020, as the Secretary may implement through interim final regulation, 5 to 1 for adults (consistent with section 2707(c))”.

(a) In general.—Chapter 43 of the Internal Revenue Code of 1986 is amended by striking section 4980H.

(b) Repeal of Related Reporting Requirements.—Subpart D of part III of subchapter A of chapter 61 of such Code is amended by striking section 6056.

(c) Conforming amendments.—

(1) Section 6724(d)(1)(B) of such Code is amended by inserting “or” at the end of clause (xxiii), by striking “or” at the end of clause (xxiv), and by striking clause (xxv).

(2) Section 6724(d)(2) of such Code is amended by inserting “or” at the end of subparagraph (GG) and by striking subparagraph (HH).

(3) The table of sections for chapter 43 of such Code is amended by striking the item relating to section 4980H.

(4) The table of sections for subpart D of part III of subchapter A of chapter 61 of such Code is amended by striking the item relating to section 6056.

(5) Section 1513 of the Patient Protection and Affordable Care Act is amended by striking subsection (c).

(d) Effective date.—

(1) IN GENERAL.—Except as otherwise provided in this subsection, the amendments made by this section shall apply to months and other periods beginning after December 31, 2020.

(2) REPEAL OF STUDY AND REPORT.—The amendment made by subsection (c)(5) shall take effect on the date of the enactment of this Act.

(a) In general.—Subject to subsection (b), for each plan year beginning on or after January 1, 2021, a group health plan and a health insurance issuer offering group health insurance coverage shall provide to each individual enrolled in such plan or such coverage for such plan year a notification containing the following:

(1) The amount the sponsor of such group health plan expended with respect to such individual under such plan for such plan year (or, in the case of a health insurance issuer offering group health insurance coverage, the amount the employer of such individual contributed for such coverage for such individual for such plan year).

(2) The amount the sponsor of such group health plan expended with respect to such individual under such plan for each previous plan year (or, in the case of a health insurance issuer offering group health insurance coverage, the amount the employer of such individual contributed for such coverage for such individual for each previous plan year), if applicable.

(b) Limitation.—Subsection (a) shall not apply to a group health plan, or a health insurance issuer offering group health insurance coverage, for a plan year if, for such plan year, the number of individuals enrolled under such plan or such coverage was less than 100.

(c) Penalty.—In the case that the Secretary of Health and Human Services determines that a group health plan or a health insurance issuer offering group health insurance failed to provide the notice required under subsection (a), the Secretary may impose a civil monetary penalty on the sponsor of such plan or such issuer, as applicable, in an amount not to exceed $100 per individual enrolled in such plan or such coverage per day that such sponsor or issuer failed to provide such notification to such individual.

(d) Definitions.—In this section, the terms “group health plan”, “group health insurance coverage”, “health insurance issuer”, and “sponsor” have the meaning given such terms in section 2791 of the Public Health Service Act (42 U.S.C. 300gg–91).

(a) Streamlining the State Application Process.—Section 1332 of the Patient Protection and Affordable Care Act (42 U.S.C. 18052) is amended—

(1) in subsection (a)(1)(C), by striking “the law” and inserting “a law or has in effect a certification”; and

(2) in subsection (b)(2)—

(A) in the paragraph heading, by inserting “or certify” after “law”;

(B) in subparagraph (A)—

(i) by striking “A law” and inserting the following:

“(i) LAWS.—A law”; and

(ii) by adding at the end the following:

“(ii) CERTIFICATIONS.—A certification described in this paragraph is a document, signed by the Governor of the State, that certifies that such Governor has the authority under existing Federal and State law to take action under this section, including implementation of the State plan under subsection (a)(1)(B).”; and

(C) in subparagraph (B)—

(i) in the subparagraph heading, by striking “of opt out”; and

(ii) by striking “may repeal a law” and all that follows through the period at the end and inserting the following: “may terminate the authority provided under the waiver with respect to the State by—

“(i) repealing a law described in subparagraph (A)(i); or

“(ii) terminating a certification described in subparagraph (A)(ii), through a certification for such termination signed by the Governor of the State.”.

(b) Providing expedited approval of State waivers.—Section 1332(d) of the Patient Protection and Affordable Care Act (42 U.S.C. 18052(d)) is amended—

(1) in paragraph (1) by striking “180” and inserting “90”; and

(2) by adding at the end the following:

“(3) EXPEDITED DETERMINATION.—

“(A) IN GENERAL.—With respect to any application under subsection (a)(1) submitted on or after the date of this paragraph or any such application submitted prior to such date of enactment and under review by the Secretary on such date of enactment, the Secretary shall make a determination on such application, using the criteria for approval otherwise applicable under this section, not later than 45 days after the receipt of such application, and shall allow the public notice and comment at the State and Federal levels described under subsection (a)(4) to occur concurrently if such State application—

“(i) is submitted in response to an urgent situation, with respect to areas in the State that the Secretary determines are at risk for excessive premium increases or having no health plans offered in the applicable health insurance market for the current or following plan year; or

“(ii) is for a waiver that is the same or substantially similar to a waiver that the Secretary already has approved for another State.

“(B) APPROVAL.—

“(i) URGENT SITUATIONS.—

“(I) PROVISIONAL APPROVAL.—A waiver approved under the expedited determination process under subparagraph (A)(i) shall be in effect for a period of 3 years, unless the State requests a shorter duration.

“(II) FULL APPROVAL.—Subject to the requirements for approval otherwise applicable under this section, not later than 1 year before the expiration of a provisional waiver period described in subclause (I) with respect to an application described in subparagraph (A)(i), the Secretary shall make a determination on whether to extend the approval of such waiver for the full term of the waiver requested by the State, for a total approval period not to exceed 6 years. The Secretary may request additional information as the Secretary determines appropriate to make such determination.

“(ii) APPROVAL OF SAME OR SIMILAR APPLICATIONS.—An approval of a waiver under subparagraph (A)(ii) shall be subject to the terms of subsection (e).

“(C) GAO STUDY.—Not later than 5 years after the date of enactment of this paragraph, the Comptroller General of the United States shall conduct a review of all waivers approved pursuant to an application under subparagraph (A)(ii) to evaluate whether such waivers met the requirements of subsection (b)(1) and whether the applications should have qualified for such expedited process.”.

(c) Providing certainty for State-Based reforms.—Section 1332(e) of the Patient Protection and Affordable Care Act (42 U.S.C. 18052(e)) is amended by striking “No waiver” and all that follows through the period at the end and inserting the following: “A waiver under this section—

“(1) shall be in effect for a period of 6 years unless the State requests a shorter duration;

“(2) may be renewed, subject to the State meeting the criteria for approval otherwise applicable under this section, for unlimited additional 6-year periods upon application by the State; and

“(3) may not be suspended or terminated, in whole or in part, by the Secretary at any time before the date of expiration of the waiver period (including any renewal period under paragraph (2)), unless the Secretary determines that the State materially failed to comply with the terms and conditions of the waiver.”.

(d) Ensuring Patient Access to More Flexible Health Plans.—Section 1332(b)(1)(B) of the Patient Protection and Affordable Care Act (42 U.S.C. 18052(b)(1)(B)) is amended by striking “at least as affordable” and inserting “of comparable affordability, including for low-income individuals, individuals with serious health needs, and other vulnerable populations,”.

(e) Applicability.—The amendments made by this Act to section 1332 of the Patient Protection and Affordable Care Act (42 U.S.C. 18052)—

(1) with respect to applications for waivers under such section 1332 submitted after the date of enactment of this Act and applications for such waivers submitted prior to such date of enactment and under review by the Secretary on the date of enactment, shall take effect on the date of enactment of this Act; and

(2) with respect to applications for waivers approved under such section 1332 before the date of enactment of this Act, shall not require reconsideration of whether such applications meet the requirements of such section 1332, except that, at the request of a State, the Secretary shall recalculate the amount of funding provided under subsection (a)(3) of such section.

Section 1311(c) of the Patient Protection and Affordable Care Act (42 U.S.C. 18031(c)) is amended—

(1) in paragraph (6), by striking “The Secretary” and inserting “Subject to paragraph (7), the Secretary”; and

(2) by adding at the end the following new paragraph:

“(7) FLEXIBILITY FOR ENROLLMENT PERIODS.—

“(A) STATE-OPERATED EXCHANGES OPEN ENROLLMENT PERIODS.—In the case of an Exchange operated by a State, beginning with plan year 2021, the Exchange may provide for open enrollment periods (after the initial enrollment period) every 12, 24, or 36 months, as determined by the State.”.

(a) Exchanges.—Paragraph (7) of section 1311(c) of the Patient Protection and Affordable Care Act (42 U.S.C. 18031(c)), as added by section 106, is amended by adding at the end the following new subparagraph:

“(B) ENROLLMENTS OTHER THAN DURING INITIAL, OPEN, AND SPECIAL ENROLLMENT PERIODS.—Beginning with plan year 2021, an Exchange may provide for enrollments during period in addition to open enrollment periods described in subparagraph (A) or paragraph (6) and special enrollment periods described in paragraph (6).”.

(b) Health plans.—Subpart I of part A of title XXVII of the Public Health Service Act is amended by adding at the end the following new section:

(a) Definition.—Section 2791(b) of the Public Health Service Act (42 U.S.C. 300gg–91(b)) is amended by adding at the end the following:

“(6) SHORT-TERM LIMITED DURATION INSURANCE.—The term ‘short-term limited duration insurance’ means health insurance coverage provided pursuant to a contract with a health insurance issuer that has an expiration date specified in the contract (not taking into account any extensions that may be elected by the policyholder with or without the issuer’s consent) that is less than 12 months after the original effective date of the contract.”.

(b) Guaranteed renewability.—Section 2703 of the Public Health Service Act (42 U.S.C. 300gg–2) is amended—

(1) in subsection (a), by inserting “or offers short-term limited duration insurance” after “group market”; and

(2) by adding at the end the following:

“(f) Application to short-Term limited duration insurance.—

“(1) IN GENERAL.—In applying this section in the case of short-term limited duration insurance—

“(A) a reference to ‘health insurance coverage’ with respect to such coverage offered in the individual market shall be deemed to include short-term limited duration insurance; and

“(B) a reference to ‘health insurance issuer’ with respect to health insurance coverage offered in the individual market shall be deemed to include an issuer of short-term limited duration insurance.

“(2) SPECIAL RULE FOR SHORT-TERM LIMITED DURATION INSURANCE.—In the case of short-term limited duration insurance, at the time of application for enrollment in such insurance coverage, an issuer of such insurance may offer renewability of such coverage, and an individual may decline renewability of such coverage in accordance with this section, and the contract between such individual and the health insurance issuer shall specify whether the individual opted for renewability or no renewability.”.

(c) Applicability.—The amendments made by subsections (a) and (b) shall apply with respect to contracts for short-term limited duration insurance that take effect on or after January 1, 2020.

There are appropriated, out of amounts in the Treasury not otherwise appropriated, $10,000,000 to be made available by December 31, 2020, to the Center for Medicare & Medicaid Innovation to fund new research or pilot programs dedicated to pursuing viable methods of enrolling individuals in health insurance programs that cross State lines.

(a) Amendment to McCarran-Ferguson Act.—Section 3 of the Act of March 9, 1945 (15 U.S.C. 1013), commonly known as the McCarran-Ferguson Act, is amended by adding at the end the following:

“(c) (1) Nothing contained in this Act shall modify, impair, or supersede the operation of any of the antitrust laws with respect to the business of health insurance (including the business of dental insurance and limited-scope dental benefits).

“(2) Paragraph (1) shall not apply with respect to making a contract, or engaging in a combination or conspiracy—

“(A) to collect, compile, or disseminate historical loss data;

“(B) to determine a loss development factor applicable to historical loss data;

“(C) to perform actuarial services if such contract, combination, or conspiracy does not involve a restraint of trade; or

“(D) to develop or disseminate a standard insurance policy form (including a standard addendum to an insurance policy form and standard terminology in an insurance policy form) if such contract, combination, or conspiracy is not to adhere to such standard form or require adherence to such standard form.

“(3) For purposes of this subsection—

“(A) the term ‘antitrust laws’ has the meaning given it in subsection (a) of the first section of the Clayton Act (15 U.S.C. 12), except that such term includes section 5 of the Federal Trade Commission Act (15 U.S.C. 45) to the extent that such section 5 applies to unfair methods of competition;

“(B) the term ‘business of health insurance (including the business of dental insurance and limited-scope dental benefits)’ does not include—

“(i) the business of life insurance (including annuities); or

“(ii) the business of property or casualty insurance, including but not limited to—

“(I) any insurance or benefits defined as ‘excepted benefits’ under paragraph (1), subparagraph (B) or (C) of paragraph (2), or paragraph (3) of section 9832(c) of the Internal Revenue Code of 1986 (26 U.S.C. 9832(c)) whether offered separately or in combination with insurance or benefits described in paragraph (2)(A) of such section; and

“(II) any other line of insurance that is classified as property or casualty insurance under State law;

“(C) the term ‘historical loss data’ means information respecting claims paid, or reserves held for claims reported, by any person engaged in the business of insurance; and

“(D) the term ‘loss development factor’ means an adjustment to be made to reserves held for losses incurred for claims reported by any person engaged in the business of insurance, for the purpose of bringing such reserves to an ultimate paid basis.”.

(b) Related provision.—For purposes of section 5 of the Federal Trade Commission Act (15 U.S.C. 45) to the extent such section applies to unfair methods of competition, section 3(c) of the McCarran-Ferguson Act shall apply with respect to the business of health insurance without regard to whether such business is carried on for profit, notwithstanding the definition of “Corporation” contained in section 4 of the Federal Trade Commission Act.

Section 1312(d)(3)(D) of the Patient Protection and Affordable Care Act (42 U.S.C. 18032(d)(3)(D)) is amended—

(1) in the subparagraph heading, by striking “Members of Congress” and inserting “President, Vice President, Members of Congress, and Federal employees”;

(2) in clause (i), in the matter preceding subclause (I)—

(A) by striking “Members of Congress and congressional staff” and inserting “the President, Vice President, Members of Congress, and Federal employees”; and

(B) by striking “a Member of Congress or congressional staff” and inserting “the President, the Vice President, a Member of Congress, or a Federal employee”; and

(3) in clause (ii), by amending subclause (II) to read as follows:

“(II) FEDERAL EMPLOYEE.—The term ‘Federal employee’ means—

“(aa) an ‘employee’, as such term is defined in section 2105 of title 5, United States Code; and

“(bb) includes an individual to whom subsection (c) or (f) of such section 2105 pertains (whether or not such individual satisfies item (aa)).”.

(a) Cost-sharing reduction payments.—Section 1402 of the Patient Protection and Affordable Care Act (42 U.S.C. 18071) is amended by adding at the end the following new subsection:

“(g) Funding.—

“(1) APPROPRIATIONS.—There is appropriated, from any money in the Treasury not otherwise appropriated, such sums as may be necessary to, subject to paragraph (2), provide health benefits coverage through payment to issuers (under this section or through advance payment by the Secretary of the Treasury under section 1412(c)(3)) of the amounts computed under this section for each of plan years 2019 through 2022.

“(2) ADJUSTMENTS.—Notwithstanding any other provision of law, payments and other actions for adjustments to obligations incurred prior to December 31, 2020, may be made through December 31, 2021.

“(3) LIMITATION.—Amounts appropriated under paragraph (1) for each of plan years 2019 through 2022 are subject to the requirements and limitations under sections 506 and 507 of division H of Public Law 115–31 in the same manner and to the same extent as if such amounts for each such year were appropriated under such division.”.

(b) Election.—In the case of an election under this subsection by a State and a certification by the Secretary of Health and Human Services that such election will not result in an increase in Federal expenditures, in lieu of the amounts that would be paid to health insurance issuers in such State under section 1402 of the Patient Protection and Affordable Care Act, the Secretary may pay to such State an amount equal to such amounts. Prior to such payment, such State shall make such assurances as the Secretary deems necessary to ensure that such State shall redistribute such payments to health savings accounts of individuals—

(1) enrolled in qualified health plans (as defined in section 36B of the Internal Revenue Code of 1986) offered by such issuers, and

(2) whose income is less than 250 percent of the Federal poverty line.

(a) No high deductible health plans required for health savings account contributions.—

(1) IN GENERAL.—Section 223 of the Internal Revenue Code of 1986 is amended by inserting “or qualified health plan” after “high deductible health plan” each place such term appears.

(2) QUALIFIED HEALTH PLAN DEFINED.—Section 223(c) of such Code is amended to read as follows:

“(c) Eligible individual.—For purposes of this section—

“(1) IN GENERAL.—The term ‘eligible individual’ means, with respect to any month, any individual if such individual is covered under a qualified health plan as of the 1st day of such month.

“(2) QUALIFIED HEALTH PLAN.—The term ‘qualified health plan’ has the meaning given such term in section 36B.”.

(b) Premiums for plans as qualified medical expenses; treatment of abortions.—

(1) IN GENERAL.—Section 223(d)(2)(B) of such Code is amended to read as follows:

“(B) ABORTIONS.—

“(i) PAYMENTS FOR HEALTH INSURANCE WITH ABORTION COVERAGE.—The term ‘qualified medical expense’ shall not include amounts paid for insurance that includes coverage for abortions.

“(ii) PAYMENTS FOR ABORTIONS.—The term ‘qualified medical expense’ shall not include amounts paid for an abortion.

“(iii) EXCEPTION.—Clauses (i) and (ii) shall not apply to an abortion, or to coverage for an abortion—

“(I) if the pregnancy is the result of an act of rape or incest, or

“(II) in the case where a woman suffers from a physical disorder, physical injury, or physical illness that would, as certified by a physician, place the woman in danger of death unless an abortion is performed, including a life-endangering physical condition caused by or arising from the pregnancy itself.”.

(2) CONFORMING AMENDMENT.—Subsection 223(d)(2) is amended by striking subparagraph (C).

(a) In general.—Section 1302 of the Patient Protection and Affordable Care Act (42 U.S.C. 18022) is amended—

(1) in subsection (a)(3), by inserting “copper,” after “either the”;

(2) in subsection (c), by adding at the end the following new paragraph:

“(5) SPECIAL RULE FOR COPPER PLANS.—A health plan in the copper level of coverage (as described in subsection (d)(1)(E)) shall be deemed to meet the requirements of this subsection.”;

(3) in subsection (d)—

(A) in paragraph (1), by adding at the end the following new subparagraph:

“(E) COPPER LEVEL.—A plan in the copper level shall provide a level of coverage that is designed to provide benefits that are actuarially equivalent to 50 percent of the full actuarial value of the benefits provided under the plan.”; and

(B) in paragraph (4)—

(i) by inserting “copper,” after “any reference to a”; and

(ii) by inserting “copper,” after “providing a”; and

(4) in subsection (e)(1), by inserting “copper,” after “not providing a”.

(b) Effective date.—The amendments made by this section shall apply with respect to plan years beginning on or after January 1, 2020.

Section 8905(b) of title 5, United States Code, is amended—

(1) in the matter preceding paragraph (1), by striking “An” and inserting “Consistent with the last sentence of this subsection, an”; and

(2) by adding at the end the following: “. An individual who is entitled to benefits under part A of title XVIII of the Social Security Act (42 U.S.C. 1395c et seq.) by reason of section 226 or 226A of such Act (42 U.S.C. 426, 426–1), or otherwise eligible to enroll under such part pursuant to section 1818 or 1818A of such Act (42 U.S.C. 1395i–2, 1395i–2a), and who first becomes an annuitant after the date of enactment of this sentence may not continue enrollment in any health benefits plan under this chapter.”.

(a) In General.—Subtitle B of title I of the Employee Retirement Income Security Act of 1974 is amended by adding after part 7 the following new part:

(b) Conforming Amendments to Preemption Rules.—

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

“(E) The preceding subparagraphs of this paragraph do not apply with respect to any State law in the case of an association health plan which is certified under part 8.”.

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

(A) in subsection (b)(4), by striking “Subsection (a)” and inserting “Subsections (a) and (f)”;

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

(C) by adding at the end the following new subsection:

“(f) (1) Except as provided in subsection (b)(4), the provisions of this title shall supersede any and all State laws insofar as they may now or hereafter preclude, or have the effect of precluding, a health insurance issuer from offering health insurance coverage in connection with an association health plan which is certified under part 8.

“(2) Except as provided in paragraphs (4) and (5) of subsection (b) of this section—

“(A) In any case in which health insurance coverage of any policy type is offered under an association health plan certified under part 8 to a participating employer operating in such State, the provisions of this title shall supersede any and all laws of such State insofar as they may preclude a health insurance issuer from offering health insurance coverage of the same policy type to other employers operating in the State which are eligible for coverage under such association health plan, whether or not such other employers are participating employers in such plan.

“(B) In any case in which health insurance coverage of any policy type is offered in a State under an association health plan certified under part 8 and the filing, with the applicable State authority (as defined in section 812(a)(9)), of the policy form in connection with such policy type is approved by such State authority, the provisions of this title shall supersede any and all laws of any other State in which health insurance coverage of such type is offered, insofar as they may preclude, upon the filing in the same form and manner of such policy form with the applicable State authority in such other State, the approval of the filing in such other State.

“(3) Nothing in subsection (b)(6)(E) or the preceding provisions of this subsection shall be construed, with respect to health insurance issuers or health insurance coverage, to supersede or impair the law of any State—

“(A) providing solvency standards or similar standards regarding the adequacy of insurer capital, surplus, reserves, or contributions, or

“(B) relating to prompt payment of claims.

“(4) For additional provisions relating to association health plans, see subsections (a)(2)(B) and (b) of section 805.

“(5) For purposes of this subsection, the term ‘association health plan’ has the meaning provided in section 801(a), and the terms ‘health insurance coverage’, ‘participating employer’, and ‘health insurance issuer’ have the meanings provided such terms in section 812, respectively.”.

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

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

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

(C) by adding at the end the following new clause:

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

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

(A) by striking “Nothing” and inserting “(1) Except as provided in paragraph (2), nothing”; and

(B) by adding at the end the following new paragraph:

“(2) Nothing in any other provision of law enacted on or after the date of the enactment of this paragraph shall be construed to alter, amend, modify, invalidate, impair, or supersede any provision of this title, except by specific cross-reference to the affected section.”.

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

(d) Disclosure of Solvency Protections Related to Self-Insured and Fully Insured Options Under Association Health Plans.—Section 102(b) of such Act (29 U.S.C. 102(b)) is amended by adding at the end the following: “An association health plan shall include in its summary plan description, in connection with each benefit option, a description of the form of solvency or guarantee fund protection secured pursuant to this Act or applicable State law, if any.”.

(e) Savings Clause.—Section 731(c) of such Act is amended by inserting “or part 8” after “this part”.

(f) Report to the Congress Regarding Certification of Self-Insured Association Health Plans.—Not later than January 1, 2022, the Secretary of Labor shall report to the Committee on Education and Labor of the House of Representatives and the Committee on Health, Education, Labor, and Pensions of the Senate the effect association health plans have had, if any, on reducing the number of uninsured individuals.

(g) Clerical Amendment.—The table of contents in section 1 of the Employee Retirement Income Security Act of 1974 is amended by inserting after the item relating to section 734 the following new items:

Section 3(40)(B) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002(40)(B)) is amended—

(1) in clause (i), by inserting after “control group,” the following: “except that, in any case in which the benefit referred to in subparagraph (A) consists of medical care (as defined in section 812(a)(2)), two or more trades or businesses, whether or not incorporated, shall be deemed a single employer for any plan year of such plan, or any fiscal year of such other arrangement, if such trades or businesses are within the same control group during such year or at any time during the preceding 1-year period,”;

(2) in clause (iii), by striking “(iii) the determination” and inserting the following:

“(iii) (I) in any case in which the benefit referred to in subparagraph (A) consists of medical care (as defined in section 812(a)(2)), the determination of whether a trade or business is under ‘common control’ with another trade or business shall be determined under regulations of the Secretary applying principles consistent and coextensive with the principles applied in determining whether employees of two or more trades or businesses are treated as employed by a single employer under section 4001(b), except that, for purposes of this paragraph, an interest of greater than 25 percent may not be required as the minimum interest necessary for common control, or

“(II) in any other case, the determination”;

(3) by redesignating clauses (iv) and (v) as clauses (v) and (vi), respectively; and

(4) by inserting after clause (iii) the following new clause:

“(iv) in any case in which the benefit referred to in subparagraph (A) consists of medical care (as defined in section 812(a)(2)), in determining, after the application of clause (i), whether benefits are provided to employees of two or more employers, the arrangement shall be treated as having only one participating employer if, after the application of clause (i), the number of individuals who are employees and former employees of any one participating employer and who are covered under the arrangement is greater than 75 percent of the aggregate number of all individuals who are employees or former employees of participating employers and who are covered under the arrangement,”.

(a) Criminal Penalties for Certain Willful Misrepresentations.—Section 501 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1131) is amended by adding at the end the following new subsection:

“(c) Any person who willfully falsely represents, to any employee, any employee’s beneficiary, any employer, the Secretary, or any State, a plan or other arrangement established or maintained for the purpose of offering or providing any benefit described in section 3(1) to employees or their beneficiaries as—

“(1) being an association health plan which has been certified under part 8;

“(2) having been established or maintained under or pursuant to one or more collective bargaining agreements which are reached pursuant to collective bargaining described in section 8(d) of the National Labor Relations Act (29 U.S.C. 158(d)) or paragraph Fourth of section 2 of the Railway Labor Act (45 U.S.C. 152, paragraph Fourth) or which are reached pursuant to labor-management negotiations under similar provisions of State public employee relations laws; or

“(3) being a plan or arrangement described in section 3(40)(A)(i),

shall, upon conviction, be imprisoned not more than 5 years, be fined under title 18, United States Code, or both.”.

(b) Cease Activities Orders.—Section 502 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1132) is amended by adding at the end the following new subsection:

“(n) Association Health Plan Cease and Desist Orders.—

“(1) IN GENERAL.—Subject to paragraph (2), upon application by the Secretary showing the operation, promotion, or marketing of an association health plan (or similar arrangement providing benefits consisting of medical care (as defined in section 733(a)(2))) that—

“(A) is not certified under part 8, is subject under section 514(b)(6) to the insurance laws of any State in which the plan or arrangement offers or provides benefits, and is not licensed, registered, or otherwise approved under the insurance laws of such State; or

“(B) is an association health plan certified under part 8 and is not operating in accordance with the requirements under part 8 for such certification,

a district court of the United States shall enter an order requiring that the plan or arrangement cease activities.

“(2) EXCEPTION.—Paragraph (1) shall not apply in the case of an association health plan or other arrangement if the plan or arrangement shows that—

“(A) all benefits under it referred to in paragraph (1) consist of health insurance coverage; and

“(B) with respect to each State in which the plan or arrangement offers or provides benefits, the plan or arrangement is operating in accordance with applicable State laws that are not superseded under section 514.

“(3) ADDITIONAL EQUITABLE RELIEF.—The court may grant such additional equitable relief, including any relief available under this title, as it deems necessary to protect the interests of the public and of persons having claims for benefits against the plan.”.

(c) Responsibility for Claims Procedure.—Section 503 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1133) is amended by inserting “(a) In general.—” before “In accordance”, and by adding at the end the following new subsection:

“(b) Association Health Plans.—The terms of each association health plan which is or has been certified under part 8 shall require the board of trustees or the named fiduciary (as applicable) to ensure that the requirements of this section are met in connection with claims filed under the plan.”.

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

“(d) Consultation With States With Respect to Association Health Plans.—

“(1) AGREEMENTS WITH STATES.—The Secretary shall consult with the State recognized under paragraph (2) with respect to an association health plan regarding the exercise of—

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

“(B) the Secretary’s authority to certify association health plans under part 8 in accordance with regulations of the Secretary applicable to certification under part 8.

“(2) RECOGNITION OF PRIMARY DOMICILE STATE.—In carrying out paragraph (1), the Secretary shall ensure that only one State will be recognized, with respect to any particular association health plan, as the State with which consultation is required. In carrying out this paragraph—

“(A) in the case of a plan which provides health insurance coverage (as defined in section 812(a)(3)), such State shall be the State with which filing and approval of a policy type offered by the plan was initially obtained, and

“(B) in any other case, the Secretary shall take into account the places of residence of the participants and beneficiaries under the plan and the State in which the trust is maintained.”.

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

(b) Treatment of Certain Existing Health Benefits Programs.—

(1) IN GENERAL.—In any case in which, as of the date of the enactment of this Act, an arrangement is maintained in a State for the purpose of providing benefits consisting of medical care for the employees and beneficiaries of its participating employers, at least 200 participating employers make contributions to such arrangement, such arrangement has been in existence for at least 10 years, and such arrangement is licensed under the laws of one or more States to provide such benefits to its participating employers, upon the filing with the applicable authority (as defined in section 812(a)(5) of the Employee Retirement Income Security Act of 1974 (as amended by this subtitle)) by the arrangement of an application for certification of the arrangement under part 8 of subtitle B of title I of such Act—

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

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

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

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

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

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

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

The provisions of this subsection shall cease to apply with respect to any such arrangement at such time after the date of the enactment of this Act as the applicable requirements of this subsection are not met with respect to such arrangement.

(2) DEFINITIONS.—For purposes of this subsection, the terms “group health plan”, “medical care”, and “participating employer” shall have the meanings provided in section 812 of the Employee Retirement Income Security Act of 1974, except that the reference in paragraph (7) of such section to an “association health plan” shall be deemed a reference to an arrangement referred to in this subsection.

(c) Coordination with existing law.—Nothing in this Act shall require plans to become certified under section 802 of the Employee Retirement Income Security Act of 1974, as amended by this Act, or require plans that are not certified under such section to comply with the requirements under part 8 of such Act, except to the extent provided in section 809 of such Act.

(a) Modification of applicable percentage.—Section 36B(b)(3)(A) of the Internal Revenue Code of 1986 is amended to read as follows:

“(A) APPLICABLE PERCENTAGE.—

“(i) IN GENERAL.—The applicable percentage for any taxable year shall be the percentage such that the applicable percentage for any taxpayer whose household income is within an income tier specified in the following table shall increase, on a sliding scale in a linear manner, from the initial percentage to the final percentage specified in such table for such income tier with respect to a taxpayer of the age involved:

“(ii) AGE DETERMINATIONS.—

“(I) IN GENERAL.—For purposes of clause (i), the age of the taxpayer taken into account under clause (i) with respect to any taxable year is the age attained by such taxpayer before the close of such taxable year.

“(II) JOINT RETURNS.—In the case of a joint return, the age of the older spouse shall be taken into account under clause (i).

“(iii) INDEXING.—In the case of any taxable year beginning after calendar year 2021, the initial and final percentages contained in clause (i) shall be adjusted to reflect—

“(I) the excess (if any) of the rate of premium growth for the period beginning with calendar year 2013 and ending with calendar year 2020, over the rate of income growth for such period, and

“(II) in addition to any adjustment under subclause (I), the excess (if any) of the rate of premium growth for calendar year 2020, over the rate of growth in the consumer price index for calendar year 2020.

“(iv) FAILSAFE.—Clause (iii)(II) shall apply only if the aggregate amount of premium tax credits under this section and cost-sharing reductions under section 1402 of the Patient Protection and Affordable Care Act for calendar year 2018 exceeds an amount equal to 0.504 percent of the gross domestic product for such calendar year.”.

(b) Effective date.—The amendment made by this section shall apply to taxable years beginning after December 31, 2020.

(a) In general.—The Patient Protection and Affordable Care Act is amended by striking section 9010.

(b) Effective date.—The amendments made by this section shall apply with respect to calendar years beginning after December 31, 2019.

(a) In general.—Chapter 32 of the Internal Revenue Code of 1986 is amended by striking subchapter E.

(b) Conforming amendments.—

(1) Subsection (a) of section 4221 of such Code is amended by striking the last sentence.

(2) Paragraph (2) of section 6416(b) of such Code is amended by striking the last sentence.

(c) Clerical amendment.—The table of subchapters for chapter 32 of such Code is amended by striking the item relating to subchapter E.

(d) Effective date.—The amendments made by this section shall apply to sales after December 31, 2017.

(a) In general.—Section 106 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:

“(h) Limitation.—

“(1) IN GENERAL.—Subsection (a) shall not apply to the extent that employer-provided coverage under health plans for an employee for a taxable year exceeds—

“(A) $10,200 for self-only coverage, and

“(B) $27,500 for all other coverage.

“(2) IN GENERAL.—In the case of any calendar year after 2021, the dollar amounts in paragraph (1) shall each be increased by an amount equal to—

“(A) such dollar amount, multiplied by—

“(B) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year, determined

“(i) by substituting ‘calendar year 2020’ for ‘calendar year 2016’ in subparagraph (A)(ii) thereof, and

“(ii) by substituting for the C–CPI–U referred to in section 1(f)(3)(A) the amount that such CPI would have been if the annual percentage increase in CPI with respect to each year after 2020 and before 2031 had been one percentage point greater.

“(3) TERMS RELATED TO CPI.—

“(A) ANNUAL PERCENTAGE INCREASE.—For purposes of subparagraph (B)(ii)(II), the term ‘annual percentage increase’ means the percentage (if any) by which C–CPI–U for any year exceeds the C–CPI–U for the prior year.

“(B) OTHER TERMS.—Terms used in this paragraph which are also used in section 1(f)(3) shall have the same meanings as when used in such section.”.

(b) Repeal of employer-Sponsored health coverage excise tax.—The Internal Revenue Code of 1986 is amended by striking section 4980I.

(c) Effective date.—The amendments made by this section shall apply with respect to taxable years beginning after December 31, 2020.

(a) HSAS.—Section 223(d)(2) of the Internal Revenue Code of 1986 is amended—

(1) by striking the last sentence of subparagraph (A) and inserting the following: “For purposes of this subparagraph, amounts paid for menstrual care products shall be treated as paid for medical care.”, and

(2) by adding at the end the following new subparagraph:

“(D) MENSTRUAL CARE PRODUCT.—For purposes of this paragraph, the term ‘menstrual care product’ means a tampon, pad, liner, cup, sponge, or similar product used by women with respect to menstruation or other genital-tract secretions.”.

(b) Archer MSAS.—Section 220(d)(2)(A) of such Code is amended by striking the last sentence and inserting the following: “For purposes of this subparagraph, amounts paid for menstrual care products (as defined in section 223(d)(2)(D)) shall be treated as paid for medical care.”.

(c) Health flexible spending arrangements and health reimbursement arrangements.—Section 106 of such Code is amended by striking subsection (f) and inserting the following new subsection:

“(f) Reimbursements for menstrual care products.—For purposes of this section and section 105, expenses incurred for menstrual care products (as defined in section 223(d)(2)(D)) shall be treated as incurred for medical care.”.

(d) Effective dates.—

(1) DISTRIBUTIONS FROM HEALTH SAVINGS ACCOUNTS.—The amendments made by subsections (a) and (b) shall apply to amounts paid after December 31, 2020.

(2) REIMBURSEMENTS.—The amendment made by subsection (c) shall apply to expenses incurred after December 31, 2020.

(a) In general.—Section 125 of the Internal Revenue Code of 1986 is amended by striking subsection (i).

(b) Effective date.—The amendment made by this section shall apply to taxable years beginning after December 31, 2018.

(a) In general.—Section 139A of the Internal Revenue Code of 1986 is amended by adding at the end the following: “This section shall not be taken into account for purposes of determining whether any deduction is allowable with respect to any cost taken into account in determining such payment.”.

(b) Effective date.—The amendment made by this section shall apply to taxable years beginning after December 31, 2018.

(a) In general.—Subtitle A of the Internal Revenue Code of 1986 is amended by striking chapter 2A.

(b) Effective date.—The amendment made by this section shall apply to taxable years beginning after December 31, 2019.

Nothing in the Internal Revenue Code of 1986 shall be construed to prevent the Secretary of the Treasury (or any designee of the Secretary) from providing that the basis for determining gain or loss (whether on the basis of cost or otherwise) is adjusted on the basis of inflation.

(a) In general.—Part VI of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:

(b) Clerical amendment.—The table of sections for part VI of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item:

“Sec. 199B. Qualified charity care.”.

(a) In general.—Title II of the Public Health Service Act (42 U.S.C. 202 et seq.) is amended by inserting after section 224 the following:

(b) Effective date.—The amendments made by this section shall apply to any claim filed to the extent that it is with respect to acts or omissions occurring after the date of the enactment of this Act.

Title XIX of the Social Security Act is amended—

(1) in section 1903 (42 U.S.C. 1396b)—

(A) in subsection (a), in the matter before paragraph (1), by inserting “and section 1903A(a)” after “except as otherwise provided in this section”; and

(B) in subsection (d)(1), by striking “to which” and inserting “to which, subject to section 1903A(a),”; and

(2) by inserting after such section 1903 the following new section:

(a) State flexibility To use contractors To make eligibility determinations on behalf of State.—Section 1902(a)(5) of the Social Security Act (42 U.S.C. 1396a(a)(5)) is amended by inserting before the semicolon at the end the following: “, but such determinations of eligibility may be made, at the option of a State, under a contract with another State or local agency or a contractor so long as the contract does not provide incentives for the agency or contractor to delay eligibility determinations or to deny eligibility for individuals otherwise eligible for medical assistance”.

(b) Frequency of eligibility redeterminations.—Section 1902(e)(14) of the Social Security Act (42 U.S.C. 1396a(e)(14)) is amended by adding at the end the following:

“(L) FREQUENCY OF ELIGIBILITY REDETERMINATIONS.—Beginning on October 1, 2019, and notwithstanding subparagraph (H), in the case of an individual whose eligibility for medical assistance under the State plan under this title (or a waiver of such plan) is determined based on the application of modified adjusted gross income under subparagraph (A) and who is so eligible on the basis of clause (i)(VIII), (ii)(XX), or (ii)(XXIII) of subsection (a)(10)(A), at the option of the State, the State plan may provide that the individual’s eligibility shall be redetermined every 6 months (or such shorter number of months as the State may elect).”.

Section 1903(w)(4)(C)(ii) of the Social Security Act (42 U.S.C. 1396b(w)(4)(C)(ii)) is amended—

(1) by striking “of fiscal years beginning” and inserting of fiscal years—

“(I) beginning”; and

(2) by striking “it appears.” and inserting the following: it appears;

“(II) beginning on or after January 1, 2020, and before January 1, 2030, ‘4 percent’ shall be substituted for ‘6 percent’ each place it appears;

“(III) beginning on or after January 1, 2030, and before January 1, 2035, ‘3 percent’ shall be substituted for ‘6 percent’ each place it appears;

“(IV) beginning on or after January 1, 2035, and before January 1, 2040, ‘2 percent’ shall be substituted for ‘6 percent’ each place it appears;

“(V) beginning on or after January 1, 2040, and before January 1, 2045, ‘1 percent’ shall be substituted for ‘6 percent’ each place it appears; and

“(VI) beginning on or after January 1, 2045, ‘0 percent’ shall be substituted for ‘6 percent’ each place it appears.”.

(a) In general.—Subparagraphs (A) and (B) of section 36B(c)(1) of the Internal Revenue Code of 1986 are amended by inserting after “100 percent” each place such term appears the following: “(60 percent in the case of an individual enrolled through an Exchange utilized by a State that makes the election described in section 1903A of the Social Security Act)”.

(b) Effective date.—The amendments made by this section shall apply with respect to taxable years beginning after the date of the enactment of this Act.

(a) In general.—Section 1834 of the Social Security Act (42 U.S.C. 1395m) is amended by adding at the end the following new subsection:

“(x) Off-Campus provider-Based department site neutral payment.—

“(1) IN GENERAL.—With respect to items and services furnished in an off-campus provider-based department, payment under this section for such items and services shall be the amount determined under the fee schedule under section 1848 for such items and services furnished if furnished in a physician office setting.

“(2) OFF-CAMPUS PROVIDER-BASED DEPARTMENT.—For purposes of this subsection, the term ‘off-campus provider-based department’ has such meaning as specified by the Secretary.”.

(b) Effective date.—The amendment made by subsection (a) shall apply with respect to items and services furnished on or after January 1, 2021.

(a) Enrollment prohibition.—

(1) PART B.—Section 1836 of the Social Security Act (42 U.S.C. 1395o) is amended by striking the period at the end and inserting “, except that an individual who attains age 65 on or after January 1, 2030, and is an individual who, upon attaining such age, has earned $10,000,000 or more in lifetime wages, shall not be eligible to so enroll.”.

(2) PART D.—Section 1860D–1(a)(3)(A) of such Act (42 U.S.C. 1395w–101(a)(3)(A)) is amended by striking the period at the end and inserting “, excluding an individual who, upon attaining age 65, has earned $10,000,000 or more in lifetime wages.”.

(b) Medigap.—Section 1882 of the Social Security Act (42 U.S.C. 1395ss) is amended by adding at the end the following new subsection:

“(aa) Additional limitation on newly eligible beneficiaries.—

“(1) IN GENERAL.—Notwithstanding any other provision of this section, on or after January 1, 2030, a medicare supplemental policy may not be sold or issued to a targeted newly eligible Medicare beneficiary.

“(2) TARGETED NEWLY ELIGIBLE MEDICARE BENEFICIARY.—For purposes of this subsection, the term ‘targeted newly eligible Medicare beneficiary’ means an individual who, upon attaining the age of 65, has earned $10,000,000 or more in lifetime wages.”.

Section 1861(v)(1) of the Social Security Act (42 U.S.C. 1395(v)(1)) is amended—

(1) in subparagraph (T)—

(A) in clause (iv), by striking “and” at the end;

(B) in clause (v)—

(i) by striking “during fiscal year” and inserting “during fiscal years”;

(ii) by striking “or a subsequent fiscal year” and inserting “through 2020”; and

(iii) by striking the period at the end and inserting “, and”; and

(C) by adding at the end the following new clause:

“(vi) for cost reporting periods beginning during fiscal year 2021 or a subsequent fiscal year, by the percent applicable for cost reporting periods beginning during the previous fiscal year, increased (through fiscal year 2024) by 10 percentage points.”;

(2) in subparagraph (V)—

(A) in clause (i)—

(i) in subclause (III), by striking “and” at the end;

(ii) in subclause (IV)—

(I) by striking “during fiscal year” and inserting “during fiscal years 2015 through 2020”; and

(II) by striking the period at the end and inserting “; and”; and

(iii) by adding at the end the following new subclause:

“(V) for cost reporting periods beginning during fiscal year 2021 or a subsequent fiscal year, the percent applicable for cost reporting periods beginning during the previous fiscal year, increased (through fiscal year 2024) by 10 percentage points.”; and

(B) in clause (ii)—

(i) in subclause (III), by striking “and” at the end; and

(ii) in subclause (IV)—

(I) by striking “a subsequent fiscal year” and inserting “fiscal years 2015 through 2020”;

(II) by striking the period at the end and inserting “; and”; and

(III) by adding at the end the following new subclause:

“(V) for cost reporting periods beginning during fiscal year 2021 or a subsequent fiscal year, shall be reduced by the percent applicable for cost reporting periods beginning during the previous fiscal year, increased (through fiscal year 2024) by 10 percentage points.”; and

(3) in subparagraph (W)(i)—

(A) in subclause (II), by striking “and” at the end;

(B) in subclause (III)—

(i) by striking “during a subsequent fiscal year” and inserting “during fiscal years 2015 through 2020”; and

(ii) by striking the period at the end and inserting “; and”; and

(C) by adding at the end the following new subclause:

“(IV) for cost reporting periods beginning during fiscal year 2021 or a subsequent fiscal year, by the percent applicable for cost reporting periods beginning during the previous fiscal year, increased (through fiscal year 2024) by 10 percentage points.”.

(a) Statute of limitations.—

(1) IN GENERAL.—Except as provided in paragraph (2), the time for the commencement of a health care lawsuit shall be, whichever occurs first of the following:

(A) Three years after the date of the occurrence of the breach or tort.

(B) Three years after the date the medical or health care treatment that is the subject of the claim is completed.

(C) One year after the claimant discovers, or through the use of reasonable diligence should have discovered, the injury.

(2) TOLLING.—In no event shall the time for commencement of a health care lawsuit exceed 3 years after the date of the occurrence of the breach or tort or 3 years after the date the medical or health care treatment that is the subject of the claim is completed (whichever occurs first) unless tolled for any of the following—

(A) upon proof of fraud;

(B) intentional concealment; or

(C) the presence of a foreign body, which has no therapeutic or diagnostic purpose or effect, in the person of the injured person.

(3) ACTIONS BY A MINOR.—Actions by a minor shall be commenced within 3 years after the date of the occurrence of the breach or tort or 3 years after the date of the medical or health care treatment that is the subject of the claim is completed (whichever occurs first) except that actions by a minor under the full age of 6 years shall be commenced within 3 years after the date of the occurrence of the breach or tort, 3 years after the date of the medical or health care treatment that is the subject of the claim is completed, or 1 year after the injury is discovered, or through the use of reasonable diligence should have been discovered, or prior to the minor’s 8th birthday, whichever provides a longer period. Such time limitation shall be tolled for minors for any period during which a parent or guardian and a health care provider have committed fraud or collusion in the failure to bring an action on behalf of the injured minor.

(b) State flexibility.—No provision of subsection (a) shall be construed to preempt any State law (whether effective before, on, or after the date of the enactment of this Act) that—

(1) specifies a time period of less than 3 years after the date of injury or less than 1 year after the claimant discovers, or through the use of reasonable diligence should have discovered, the injury, for the filing of a health care lawsuit;

(2) that specifies a different time period for the filing of lawsuits by a minor;

(3) that triggers the time period based on the date of the alleged negligence; or

(4) establishes a statute of repose for the filing of a health care lawsuit.

(a) Unlimited amount of damages for actual economic losses in health care lawsuits.—In any health care lawsuit, nothing in this Act shall limit a claimant’s recovery of the full amount of the available economic damages, notwithstanding the limitation in subsection (b).

(b) Additional noneconomic damages.—In any health care lawsuit, the amount of noneconomic damages, if available, shall not exceed $250,000, regardless of the number of parties against whom the action is brought or the number of separate claims or actions brought with respect to the same injury.

(c) No discount of award for noneconomic damages.—For purposes of applying the limitation in subsection (b), future noneconomic damages shall not be discounted to present value. The jury shall not be informed about the maximum award for noneconomic damages. An award for noneconomic damages in excess of $250,000 shall be reduced either before the entry of judgment, or by amendment of the judgment after entry of judgment, and such reduction shall be made before accounting for any other reduction in damages required by law. If separate awards are rendered for past and future noneconomic damages and the combined awards exceed $250,000, the future noneconomic damages shall be reduced first.

(d) Fair share rule.—In any health care lawsuit, each party shall be liable for that party’s several share of any damages only and not for the share of any other person. Each party shall be liable only for the amount of damages allocated to such party in direct proportion to such party’s percentage of responsibility. Whenever a judgment of liability is rendered as to any party, a separate judgment shall be rendered against each such party for the amount allocated to such party. For purposes of this section, the trier of fact shall determine the proportion of responsibility of each party for the claimant’s harm.

(e) State flexibility.—No provision of this section shall be construed to preempt any State law (whether effective before, on, or after the date of the enactment of this Act) that specifies a particular monetary amount of economic or noneconomic damages (or the total amount of damages) that may be awarded in a health care lawsuit, regardless of whether such monetary amount is greater or lesser than is provided for under this section.

(a) Court supervision of share of damages actually paid to claimants.—In any health care lawsuit, the court shall supervise the arrangements for payment of damages to protect against conflicts of interest that may have the effect of reducing the amount of damages awarded that are actually paid to claimants. In particular, in any health care lawsuit in which the attorney for a party claims a financial stake in the outcome by virtue of a contingent fee, the court shall have the power to restrict the payment of a claimant’s damage recovery to such attorney, and to redirect such damages to the claimant based upon the interests of justice and principles of equity. In no event shall the total of all contingent fees for representing all claimants in a health care lawsuit exceed the following limits:

(1) Forty percent of the first $50,000 recovered by the claimant(s).

(2) Thirty-three and one-third percent of the next $50,000 recovered by the claimant(s).

(3) Twenty-five percent of the next $500,000 recovered by the claimant(s).

(4) Fifteen percent of any amount by which the recovery by the claimant(s) is in excess of $600,000.

(b) Applicability.—The limitations in this section shall apply whether the recovery is by judgment, settlement, mediation, arbitration, or any other form of alternative dispute resolution. In a health care lawsuit involving a minor or incompetent person, a court retains the authority to authorize or approve a fee that is less than the maximum permitted under this section. The requirement for court supervision in the first two sentences of subsection (a) applies only in civil actions.

(c) State flexibility.—No provision of this section shall be construed to preempt any State law (whether effective before, on, or after the date of the enactment of this Act) that specifies a lesser percentage or lesser total value of damages which may be claimed by an attorney representing a claimant in a health care lawsuit.

(a) In general.—In any health care lawsuit, if an award of future damages, without reduction to present value, equaling or exceeding $50,000 is made against a party with sufficient insurance or other assets to fund a periodic payment of such a judgment, the court shall, at the request of any party, enter a judgment ordering that the future damages be paid by periodic payments, in accordance with the Uniform Periodic Payment of Judgments Act promulgated by the National Conference of Commissioners on Uniform State Laws.

(b) Applicability.—This section applies to all actions which have not been first set for trial or retrial before the effective date of this Act.

(c) State Flexibility.—No provision of this section shall be construed to preempt any State law (whether effective before, on, or after the date of the enactment of this Act) that specifies periodic payments for future damages at any amount other than $50,000 or that mandates such payments absent the request of either party.

A health care provider who prescribes, or who dispenses pursuant to a prescription, a medical product approved, licensed, or cleared by the Food and Drug Administration shall not be named as a party to a product liability lawsuit involving such product and shall not be liable to a claimant in a class action lawsuit against the manufacturer, distributor, or seller of such product.

In this Act:

(1) ALTERNATIVE DISPUTE RESOLUTION SYSTEM; ADR.—The term “alternative dispute resolution system” or “ADR” means a system that provides for the resolution of health care lawsuits in a manner other than through a civil action brought in a State or Federal court.

(2) CLAIMANT.—The term “claimant” means any person who brings a health care lawsuit, including a person who asserts or claims a right to legal or equitable contribution, indemnity, or subrogation, arising out of a health care liability claim or action, and any person on whose behalf such a claim is asserted or such an action is brought, whether deceased, incompetent, or a minor.

(3) COLLATERAL SOURCE BENEFITS.—The term “collateral source benefits” means any amount paid or reasonably likely to be paid in the future to or on behalf of the claimant, or any service, product, or other benefit provided or reasonably likely to be provided in the future to or on behalf of the claimant, as a result of the injury or wrongful death, pursuant to—

(A) any State or Federal health, sickness, income-disability, accident, or workers’ compensation law;

(B) any health, sickness, income-disability, or accident insurance that provides health benefits or income-disability coverage;

(C) any contract or agreement of any group, organization, partnership, or corporation to provide, pay for, or reimburse the cost of medical, hospital, dental, or income-disability benefits; and

(D) any other publicly or privately funded program.

(4) CONTINGENT FEE.—The term “contingent fee” includes all compensation to any person or persons which is payable only if a recovery is effected on behalf of one or more claimants.

(5) ECONOMIC DAMAGES.—The term “economic damages” means objectively verifiable monetary losses incurred as a result of the provision or use of (or failure to provide or use) health care services or medical products, such as past and future medical expenses, loss of past and future earnings, cost of obtaining domestic services, loss of employment, and loss of business or employment opportunities, unless otherwise defined under applicable State law. In no circumstances shall damages for health care services or medical products exceed the amount actually paid or incurred by or on behalf of the claimant.

(6) FUTURE DAMAGES.—The term “future damages” means any damages that are incurred after the date of judgment, settlement, or other resolution (including mediation, or any other form of alternative dispute resolution).

(7) HEALTH CARE LAWSUIT.—The term “health care lawsuit” means any health care liability claim concerning the provision of goods or services for which coverage was provided in whole or in part via a Federal program, subsidy or tax benefit, or any health care liability action concerning the provision of goods or services for which coverage was provided in whole or in part via a Federal program, subsidy or tax benefit, brought in a State or Federal court or pursuant to an alternative dispute resolution system, against a health care provider regardless of the theory of liability on which the claim is based, or the number of claimants, plaintiffs, defendants, or other parties, or the number of claims or causes of action, in which the claimant alleges a health care liability claim. Such term does not include a claim or action which is based on criminal liability; which seeks civil fines or penalties paid to Federal, State, or local government; or which is grounded in antitrust.

(8) HEALTH CARE LIABILITY ACTION.—The term “health care liability action” means a civil action brought in a State or Federal court or pursuant to an alternative dispute resolution system, against a health care provider regardless of the theory of liability on which the claim is based, or the number of plaintiffs, defendants, or other parties, or the number of causes of action, in which the claimant alleges a health care liability claim.

(9) HEALTH CARE LIABILITY CLAIM.—The term “health care liability claim” means a demand by any person, whether or not pursuant to ADR, against a health care provider, including, but not limited to, third-party claims, cross-claims, counter-claims, or contribution claims, which are based upon the provision or use of (or the failure to provide or use) health care services or medical products, regardless of the theory of liability on which the claim is based, or the number of plaintiffs, defendants, or other parties, or the number of causes of action.

(10) HEALTH CARE PROVIDER.—The term “health care provider” means any person or entity required by State or Federal laws or regulations to be licensed, registered, or certified to provide health care services, and being either so licensed, registered, or certified, or exempted from such requirement by other statute or regulation, as well as any other individual or entity defined as a health care provider, health care professional, or health care institution under State law.

(11) HEALTH CARE SERVICES.—The term “health care services” means the provision of any goods or services (including safety, professional, or administrative services directly related to health care) by a health care provider, or by any individual working under the supervision of a health care provider, that relates to the diagnosis, prevention, or treatment of any human disease or impairment, or the assessment or care of the health of human beings.

(12) MEDICAL PRODUCT.—The term “medical product” means a drug, device, or biological product intended for humans, and the terms “drug”, “device”, and “biological product” have the meanings given such terms in sections 201(g)(1) and 201(h) of the Federal Food, Drug and Cosmetic Act (21 U.S.C. 321(g)(1) and (h)) and section 351(a) of the Public Health Service Act (42 U.S.C. 262(a)), respectively, including any component or raw material used therein, but excluding health care services.

(13) NONECONOMIC DAMAGES.—The term “noneconomic damages” means damages for physical and emotional pain, suffering, inconvenience, physical impairment, mental anguish, disfigurement, loss of enjoyment of life, loss of society and companionship, loss of consortium (other than loss of domestic service), hedonic damages, injury to reputation, and all other nonpecuniary losses of any kind or nature incurred as a result of the provision or use of (or failure to provide or use) health care services or medical products, unless otherwise defined under applicable State law.

(14) RECOVERY.—The term “recovery” means the net sum recovered after deducting any disbursements or costs incurred in connection with prosecution or settlement of the claim, including all costs paid or advanced by any person. Costs of health care incurred by the plaintiff and the attorneys’ office overhead costs or charges for legal services are not deductible disbursements or costs for such purpose.

(15) REPRESENTATIVE.—The term “representative” means a legal guardian, attorney, person designated to make decisions on behalf of a patient under a medical power of attorney, or any person recognized in law or custom as a patient’s agent.

(16) STATE.—The term “State” means each of the several States, the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, Guam, American Samoa, the Northern Mariana Islands, the Trust Territory of the Pacific Islands, and any other territory or possession of the United States, or any political subdivision thereof.

(a) Vaccine injury.—

(1) To the extent that title XXI of the Public Health Service Act establishes a Federal rule of law applicable to a civil action brought for a vaccine-related injury or death—

(A) this Act does not affect the application of the rule of law to such an action; and

(B) any rule of law prescribed by this subtitle in conflict with a rule of law of such title XXI shall not apply to such action.

(2) If there is an aspect of a civil action brought for a vaccine-related injury or death to which a Federal rule of law under title XXI of the Public Health Service Act does not apply, then this subtitle or otherwise applicable law (as determined under this subtitle) will apply to such aspect of such action.

(b) Other Federal law.—Except as provided in this section, nothing in this subtitle shall be deemed to affect any defense available to a defendant in a health care lawsuit or action under any other provision of Federal law.

(a) Health care lawsuits.—Unless otherwise specified in this subtitle, the provisions governing health care lawsuits set forth in this subtitle preempt, subject to subsections (b) and (c), State law to the extent that State law prevents the application of any provisions of law established by or under this subtitle. The provisions governing health care lawsuits set forth in this subtitle supersede chapter 171 of title 28, United States Code, to the extent that such chapter—

(1) provides for a greater amount of damages or contingent fees, a longer period in which a health care lawsuit may be commenced, or a reduced applicability or scope of periodic payment of future damages, than provided in this subtitle; or

(2) prohibits the introduction of evidence regarding collateral source benefits, or mandates or permits subrogation or a lien on collateral source benefits.

(b) Protection of States’ rights and other laws.—Any issue that is not governed by any provision of law established by or under this subtitle (including State standards of negligence) shall be governed by otherwise applicable State or Federal law.

(c) State Flexibility.—No provision of this subtitle shall be construed to preempt any defense available to a party in a health care lawsuit under any other provision of State or Federal law.

This subtitle shall apply to any health care lawsuit brought in a Federal or State court, or subject to an alternative dispute resolution system, that is initiated on or after the date of the enactment of this subtitle, except that any health care lawsuit arising from an injury occurring prior to the date of the enactment of this subtitle shall be governed by the applicable statute of limitations provisions in effect at the time the cause of action accrued.

(a) In general.—No person in a health care profession requiring licensure under the laws of a State shall be competent to testify in any court of law to establish the following facts—

(1) the recognized standard of acceptable professional practice and the specialty thereof, if any, that the defendant practices, which shall be the type of acceptable professional practice recognized in the defendant’s community or in a community similar to the defendant’s community that was in place at the time the alleged injury or wrongful action occurred;

(2) that the defendant acted with less than or failed to act with ordinary and reasonable care in accordance with the recognized standard; and

(3) that as a proximate result of the defendant’s negligent act or omission, the claimant suffered injuries which would not otherwise have occurred,

unless the person was licensed to practice, in the State or a contiguous bordering State, a profession or specialty which would make the person’s expert testimony relevant to the issues in the case and had practiced this profession or specialty in one of these States during the year preceding the date that the alleged injury or wrongful act occurred.

(b) Applicability.—The requirements set forth in subsection (a) shall also apply to expert witnesses testifying for the defendant as rebuttal witnesses.

(c) Waiver authority.—The court may waive the requirements in this subsection if it determines that the appropriate witnesses otherwise would not be available.

(a) Provider communications.—In any health care liability action, any and all statements, affirmations, gestures, or conduct expressing apology, fault, sympathy, commiseration, condolence, compassion, or a general sense of benevolence which are made by a health care provider or an employee of a health care provider to the patient, a relative of the patient, or a representative of the patient and which relate to the discomfort, pain, suffering, injury, or death of the patient as the result of the unanticipated outcome of medical care shall be inadmissible for any purpose as evidence of an admission of liability or as evidence of an admission against interest.

(b) State flexibility.—No provision of this section shall be construed to preempt any State law (whether effective before, on, or after the date of the enactment of this Act) that makes additional communications inadmissible as evidence of an admission of liability or as evidence of an admission against interest.

(a) In general.—In any health care lawsuit, an individual shall not give expert testimony on the appropriate standard of practice or care involved unless the individual is licensed as a health professional in one or more States and the individual meets the following criteria:

(1) If the party against whom or on whose behalf the testimony is to be offered is or claims to be a specialist, the expert witness shall specialize at the time of the occurrence that is the basis for the lawsuit in the same specialty or claimed specialty as the party against whom or on whose behalf the testimony is to be offered. If the party against whom or on whose behalf the testimony is to be offered is or claims to be a specialist who is board certified, the expert witness shall be a specialist who is board certified in that specialty or claimed specialty.

(2) During the 1-year period immediately preceding the occurrence of the action that gave rise to the lawsuit, the expert witness shall have devoted a majority of the individual’s professional time to one or more of the following:

(A) The active clinical practice of the same health profession as the defendant and, if the defendant is or claims to be a specialist, in the same specialty or claimed specialty.

(B) The instruction of students in an accredited health professional school or accredited residency or clinical research program in the same health profession as the defendant and, if the defendant is or claims to be a specialist, in an accredited health professional school or accredited residency or clinical research program in the same specialty or claimed specialty.

(3) If the defendant is a general practitioner, the expert witness shall have devoted a majority of the witness’s professional time in the 1-year period preceding the occurrence of the action giving rise to the lawsuit to one or more of the following:

(A) Active clinical practice as a general practitioner.

(B) Instruction of students in an accredited health professional school or accredited residency or clinical research program in the same health profession as the defendant.

(b) Lawsuits against entities.—If the defendant in a health care lawsuit is an entity that employs a person against whom or on whose behalf the testimony is offered, the provisions of subsection (a) apply as if the person were the party or defendant against whom or on whose behalf the testimony is offered.

(c) Power of court.—Nothing in this subsection shall limit the power of the trial court in a health care lawsuit to disqualify an expert witness on grounds other than the qualifications set forth under this subsection.

(d) Limitation.—An expert witness in a health care lawsuit shall not be permitted to testify if the fee of the witness is in any way contingent on the outcome of the lawsuit.

(e) State flexibility.—No provision of this section shall be construed to preempt any State law (whether effective before, on, or after the date of the enactment of this Act) that places additional qualification requirements upon any individual testifying as an expert witness.

(a) Required filing.—Subject to subsection (b), the plaintiff in a health care lawsuit alleging negligence or, if the plaintiff is represented by an attorney, the plaintiff’s attorney shall file simultaneously with the health care lawsuit an affidavit of merit signed by a health professional who meets the requirements for an expert witness under section 242 of this Act. The affidavit of merit shall certify that the health professional has reviewed the notice and all medical records supplied to him or her by the plaintiff’s attorney concerning the allegations contained in the notice and shall contain a statement of each of the following:

(1) The applicable standard of practice or care.

(2) The health professional’s opinion that the applicable standard of practice or care was breached by the health professional or health facility receiving the notice.

(3) The actions that should have been taken or omitted by the health professional or health facility in order to have complied with the applicable standard of practice or care.

(4) The manner in which the breach of the standard of practice or care was the proximate cause of the injury alleged in the notice.

(5) A listing of the medical records reviewed.

(b) Filing extension.—Upon motion of a party for good cause shown, the court in which the complaint is filed may grant the plaintiff or, if the plaintiff is represented by an attorney, the plaintiff’s attorney an additional 28 days in which to file the affidavit required under subsection (a).

(c) State flexibility.—No provision of this section shall be construed to preempt any State law (whether effective before, on, or after the date of the enactment of this Act) that establishes additional requirements for the filing of an affidavit of merit or similar pre-litigation documentation.

(a) Advance notice.—A person shall not commence a health care lawsuit against a health care provider unless the person has given the health care provider 90 days written notice before the action is commenced.

(b) Exceptions.—A health care lawsuit against a health care provider filed within 6 months of the statute of limitations expiring as to any claimant, or within 1 year of the statute of repose expiring as to any claimant, shall be exempt from compliance with this section.

(c) State flexibility.—No provision of this section shall be construed to preempt any State law (whether effective before, on, or after the date of the enactment of this Act) that establishes a different time period for the filing of written notice.

(a) Definitions.—In this section—

(1) the term “covered product”—

(A) means—

(i) any drug approved under subsection (b) or (j) of section 505 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355) or biological product licensed under subsection (a) or (k) of section 351 of the Public Health Service Act (42 U.S.C. 262);

(ii) any combination of a drug or biological product described in clause (i); or

(iii) when reasonably necessary to demonstrate sameness, biosimilarity, or interchangeability for purposes of section 505 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355), or section 351 of the Public Health Service Act (42 U.S.C. 262), as applicable, any product, including any device, that is marketed or intended for use with such drug or biological product; and

(B) does not include any drug or biological product that the Secretary has determined to be currently in shortage and that appears on the drug shortage list in effect under section 506E of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 356e), unless the shortage will not be promptly resolved—

(i) as demonstrated by the fact that the drug or biological product has been in shortage for more than 6 months; or

(ii) as otherwise determined by the Secretary;

(2) the term “device” has the meaning given the term in section 201 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 321);

(3) the term “eligible product developer” means a person that seeks to develop a product for approval pursuant to an application for approval under subsection (b)(2) or (j) of section 505 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355) or for licensing pursuant to an application under section 351(k) of the Public Health Service Act (42 U.S.C. 262(k));

(4) the term “license holder” means the holder of an application approved under subsection (c) or (j) of section 505 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355) or the holder of a license under subsection (a) or (k) of section 351 of the Public Health Service Act (42 U.S.C. 262) for a covered product;

(5) the term “REMS” means a risk evaluation and mitigation strategy under section 505–1 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355–1);

(6) the term “REMS with ETASU” means a REMS that contains elements to assure safe use under section 505–1 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355–1);

(7) the term “Secretary” means the Secretary of Health and Human Services;

(8) the term “single, shared system of elements to assure safe use” means a single, shared system of elements to assure safe use under section 505–1 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355–1); and

(9) the term “sufficient quantities” means an amount of a covered product that allows the eligible product developer to—

(A) conduct testing to support an application—

(i) for approval under subsection (b)(2) or (j) of section 505 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355); or

(ii) for licensing under section 351(k) of the Public Health Service Act (42 U.S.C. 262(k)); and

(B) fulfill any regulatory requirements relating to such an application for approval or licensing.

(b) Civil action for failure To provide sufficient quantities of a covered product.—

(1) IN GENERAL.—An eligible product developer may bring a civil action against the license holder for a covered product seeking relief under this subsection in an appropriate district court of the United States alleging that the license holder has declined to provide sufficient quantities of the covered product to the eligible product developer on commercially reasonable, market-based terms.

(2) ELEMENTS.—

(A) IN GENERAL.—To prevail in a civil action brought under paragraph (1), an eligible product developer shall prove, by a preponderance of the evidence—

(i) that—

(I) the covered product is not subject to a REMS with ETASU; or

(II) if the covered product is subject to a REMS with ETASU—

(aa) the eligible product developer has obtained a covered product authorization from the Secretary in accordance with subparagraph (B); and

(bb) the eligible product developer has provided a copy of the covered product authorization to the license holder;

(ii) that, as of the date on which the civil action is filed, the product developer has not obtained sufficient quantities of the covered product on commercially reasonable, market-based terms;

(iii) that the eligible product developer has requested to purchase sufficient quantities of the covered product from the license holder; and

(iv) that the license holder has not delivered to the eligible product developer sufficient quantities of the covered product on commercially reasonable, market-based terms—

(I) for a covered product that is not subject to a REMS with ETASU, by the date that is 31 days after the date on which the license holder received the request for the covered product; and

(II) for a covered product that is subject to a REMS with ETASU, by 31 days after the later of—

(aa) the date on which the license holder received the request for the covered product; or

(bb) the date on which the license holder received a copy of the covered product authorization issued by the Secretary in accordance with subparagraph (B).

(B) AUTHORIZATION FOR COVERED PRODUCT SUBJECT TO A REMS WITH ETASU.—

(i) REQUEST.—An eligible product developer may submit to the Secretary a written request for the eligible product developer to be authorized to obtain sufficient quantities of an individual covered product subject to a REMS with ETASU.

(ii) AUTHORIZATION.—Not later than 90 days after the date on which a request under clause (i) is received, the Secretary shall, by written notice, authorize the eligible product developer to obtain sufficient quantities of an individual covered product subject to a REMS with ETASU for purposes of—

(I) development and testing that does not involve human clinical trials, if the eligible product developer has agreed to comply with any conditions the Secretary determines necessary; or

(II) development and testing that involves human clinical trials, if the eligible product developer has—

(aa)(AA) submitted protocols, informed consent documents, and informational materials for testing that include protections that provide safety protections comparable to those provided by the REMS for the covered product; or

(BB) otherwise satisfied the Secretary that such protections will be provided; and

(bb) met any other requirements the Secretary may establish.

(iii) NOTICE.—A covered product authorization issued under this subparagraph shall state that the provision of the covered product by the license holder under the terms of the authorization will not be a violation of the REMS for the covered product.

(3) AFFIRMATIVE DEFENSE.—In a civil action brought under paragraph (1), it shall be an affirmative defense, on which the defendant has the burden of persuasion by a preponderance of the evidence—

(A) that, on the date on which the eligible product developer requested to purchase sufficient quantities of the covered product from the license holder—

(i) neither the license holder nor any of its agents, wholesalers, or distributors was engaged in the manufacturing or commercial marketing of the covered product; and

(ii) neither the license holder nor any of its agents, wholesalers, or distributors otherwise had access to inventory of the covered product to supply to the eligible product developer on commercially reasonable, market-based terms; or

(B) that—

(i) the license holder sells the covered product through agents, distributors, or wholesalers;

(ii) the license holder has placed no restrictions, explicit or implicit, on its agents, distributors, or wholesalers to sell covered products to eligible product developers; and

(iii) the covered product can be purchased by the eligible product developer in sufficient quantities on commercially reasonable, market-based terms from the agents, distributors, or wholesalers of the license holder.

(4) REMEDIES.—

(A) IN GENERAL.—If an eligible product developer prevails in a civil action brought under paragraph (1), the court shall—

(i) order the license holder to provide to the eligible product developer without delay sufficient quantities of the covered product on commercially reasonable, market-based terms;

(ii) award to the eligible product developer reasonable attorney fees and costs of the civil action; and

(iii) award to the eligible product developer a monetary amount sufficient to deter the license holder from failing to provide other eligible product developers with sufficient quantities of a covered product on commercially reasonable, market-based terms, if the court finds, by a preponderance of the evidence—

(I) that the license holder delayed providing sufficient quantities of the covered product to the eligible product developer without a legitimate business justification; or

(II) that the license holder failed to comply with an order issued under clause (i).

(B) MAXIMUM MONETARY AMOUNT.—A monetary amount awarded under subparagraph (A)(iii) shall not be greater than the revenue that the license holder earned on the covered product during the period—

(i) beginning on—

(I) for a covered product that is not subject to a REMS with ETASU, the date that is 31 days after the date on which the license holder received the request; or

(II) for a covered product that is subject to a REMS with ETASU, the date that is 31 days after the later of—

(aa) the date on which the license holder received the request; or

(bb) the date on which the license holder received a copy of the covered product authorization issued by the Secretary in accordance with paragraph (2)(B); and

(ii) ending on the date on which the eligible product developer received sufficient quantities of the covered product.

(C) AVOIDANCE OF DELAY.—The court may issue an order under subparagraph (A)(i) before conducting further proceedings that may be necessary to determine whether the eligible product developer is entitled to an award under clause (ii) or (iii) of subparagraph (A), or the amount of any such award.

(c) Limitation of liability.—A license holder for a covered product shall not be liable for any claim arising out of the failure of an eligible product developer to follow adequate safeguards to assure safe use of the covered product during development or testing activities described in this section, including transportation, handling, use, or disposal of the covered product by the eligible product developer.

(d) Rule of construction.—

(1) DEFINITION.—In this subsection, the term “antitrust laws”—

(A) has the meaning given the term in subsection (a) of the first section of the Clayton Act (15 U.S.C. 12); and

(B) includes section 5 of the Federal Trade Commission Act (15 U.S.C. 45) to the extent that such section applies to unfair methods of competition.

(2) ANTITRUST LAWS.—Nothing in this section shall be construed to limit the operation of any provision of the antitrust laws.

Section 505–1 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355–1) is amended—

(1) in subsection (g)(4)(B)—

(A) in clause (i) by striking “or” after the semicolon;

(B) in clause (ii) by striking the period at the end and inserting “; or”; and

(C) by adding at the end the following:

“(iii) accommodate different approved risk evaluation and mitigation strategies for a reference drug product and a drug that is the subject of an abbreviated new drug application.”; and

(2) in subsection (i)(1), by striking subparagraph (B) and inserting the following:

“(B) Elements to assure safe use, if required under subsection (f) for the listed drug in accordance with the following:

“(i) Subject to clause (ii), a drug that is the subject of an abbreviated new drug application may use—

“(I) a single, shared system with the listed drug under subsection (f); or

“(II) a different, comparable aspect of the elements to assure safe use under subsection (f).

“(ii) The Secretary may require a drug that is the subject of an abbreviated new drug application and the listed drug to use a single, shared system under subsection (f), if the Secretary determines that no different, comparable aspect of the elements to assure safe use could satisfy the requirements of subsection (f).”.

Subchapter A of chapter V of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 351 et seq.) is amended by adding at the end the following:

Subsection (b) of section 506 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 356) is amended by adding at the end the following:

“(4) UNMET MEDICAL NEED.—For purposes of paragraph (1), a drug shall be deemed to address an unmet medical need for a disease or condition if fewer than 3 available drugs exist for the treatment of such disease or condition.”.

No State, or any political subdivision thereof, may, under any circumstances, prohibit a pharmacy or pharmacist from dispensing, in place of a biological reference product, any biosimilar that the Food and Drug Administration has designated as an interchangeable product for that biological reference product.