(a) Short title.—This Act may be cited as the “American Health Care Reform Act of 2017”.

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

Sec. 1. Short title; table of contents.

(a) PPACA.—Effective on January 1, 2018, the Patient Protection and Affordable Care Act (Public Law 111–148) is repealed, and the provisions of law amended or repealed by such Act are restored or revived as if such Act had not been enacted.

(b) Health care-Related provisions in the health care and education reconciliation act of 2010.—Effective on January 1, 2018, title I and subtitle B of title II of the Health Care and Education Reconciliation Act of 2010 (Public Law 111–152) are repealed, and the provisions of law amended or repealed by such title or subtitle, respectively, are restored or revived as if such title and subtitle had not been enacted.

The budgetary effects of this Act shall not be entered on either PAYGO scorecard maintained pursuant to section 4(d) of the Statutory Pay-As-You-Go Act of 2010.

Except as otherwise expressly provided, whenever in this title an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of the Internal Revenue Code of 1986.

(a) In general.—Part VII of subchapter B of chapter 1 is amended by redesignating section 224 as section 225 and by inserting after section 223 the following new section:

(b) Deduction allowed whether or not individual itemizes other deductions.—Subsection (a) of section 62 is amended by inserting before the last sentence at the end the following new paragraph:

“(22) STANDARD DEDUCTION FOR HEALTH INSURANCE.—The deduction allowed by section 224.”.

(c) Election To take health insurance costs credit.—Section 35(g) is amended by redesignating paragraphs (9), (10), and (11) as paragraphs (10), (11), and (12), respectively, and by inserting after paragraph (8) the following new paragraph:

“(9) ELECTION NOT TO CLAIM CREDIT.—This section shall not apply to a taxpayer for any taxable year if such taxpayer elects to have this section not apply for such taxable year.”.

(d) Clerical amendment.—The table of sections for part VII of subchapter B of chapter 1 is amended by striking the item relating to section 224 and adding at the end the following new items:

“Sec. 224. Standard deduction for health insurance.
“Sec. 225. Cross reference.”.

(e) Effective date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2017.

(a) Exclusion for contributions by employer to accident and health plans.—

(1) IN GENERAL.—Section 106 is amended by adding at the end the following new subsection:

“(g) Subsections (a) and (c) apply only to individuals covered by Medicare, Medicaid, SCHIP, TRICARE, or grandfathered employer plans.—

“(1) IN GENERAL.—Except as provided in paragraph (2), subsections (a) and (c) shall not apply for any taxable year with respect to which a deduction under section 224 is allowable.

“(2) EXCEPTION FOR INDIVIDUALS COVERED BY MEDICARE, MEDICAID, SCHIP, OR GRANDFATHERED EMPLOYER PLANS.—Paragraph (1) shall not apply to an individual for any taxable year if such individual is not an eligible individual (as defined in section 224(d)(1)) for any month during such taxable year by reason of coverage described in section 224(d)(1)(B).”.

(2) CONFORMING AMENDMENTS.—

(A) Section 106(b)(1) is amended—

(i) by inserting “gross income does not include” before “amounts contributed”, and

(ii) by striking “shall be treated as employer-provided coverage for medical expenses under an accident or health plan”.

(B) Section 106(d)(1) is amended—

(i) by inserting “gross income does not include” before “amounts contributed”, and

(ii) by striking “shall be treated as employer-provided coverage for medical expenses under an accident or health plan”.

(b) Termination of deduction for health insurance costs of self-Employed individuals.—Subsection (l) of section 162 is amended by adding at the end the following new paragraph:

“(6) TERMINATION.—This subsection shall not apply to taxable years with respect to which a deduction under section 224 is allowable.”.

(c) Effective date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2017.

(a) In general.—Chapter 25 is amended by adding at the end the following new section:

(b) Self-Employment income.—Section 1402 is amended by adding at the end the following:

“(m) Standard deduction for health insurance.—For purposes of this chapter—

“(1) IN GENERAL.—The self-employment income of a taxpayer for any period (determined without regard to this subsection) shall be reduced by the excess (if any) of—

“(A) the portion of the standard deduction for health insurance (as defined in section 224) allocable to the period, over

“(B) the amount of any reduction in wages or compensation for such period under section 3512.

“(2) DETERMINATION OF STANDARD DEDUCTION ALLOCABLE TO A PERIOD.—For purposes of paragraph (1), the portion of the standard deduction allocable to any period shall be determined in a manner similar to the manner under section 3512.”.

(c) Conforming amendments.—

(1) Section 3121(a)(2) is amended by inserting “which is excludable from gross income under section 105 or 106” after “such payment)”.

(2) Subsection (a) of section 209 of the Social Security Act (42 U.S.C. 409) is amended by striking “or” at the end of paragraph (19), by striking the period at the end of paragraph (20) and inserting “; or”, and by inserting after paragraph (20) the following new paragraph:

“(21) any amount excluded from wages under section 3512(a) of the Internal Revenue Code of 1986 (relating to exclusion of standard deduction from employment taxes).”.

(3) Section 1324(b)(2) of title 31, United States Code, is amended by inserting “, or the credit under section 3512(c)(2) of such Code” before the period at the end.

(4) Section 209(k)(2) of the Social Security Act (42 U.S.C. 409(k)(2)) is amended by redesignating subparagraphs (C) and (D) as subparagraphs (D) and (E), respectively, and by inserting after subparagraph (B) the following new subparagraph:

“(C) by disregarding the exclusion from wages in subsection (a)(21),”.

(5) The table of sections for chapter 25 is amended by adding at the end the following new item:

“Sec. 3512. Exclusion of standard deduction from employment taxes.”.

(d) Effective dates.—

(1) IN GENERAL.—Except as provided in paragraph (2), the amendments made by this section shall apply to remuneration paid or accrued for periods on or after December 31, 2017.

(2) RECONCILIATION AND SELF-EMPLOYED.—Sections 3512(c) and (d)(2) of the Internal Revenue Code of 1986 (as added by subsection (a)), and the amendments made by subsection (b), shall apply to taxable years beginning after December 31, 2017.

(a) Health plan providers.—Subpart B of part III of subchapter A of chapter 61 is amended by adding at the end the following new section:

(b) Employers.—Subsection (a) of section 6051 is amended by striking “and” at the end of paragraph (13), by striking the period at the end of paragraph (14) and inserting “, and”, and by inserting after paragraph (14) the following new paragraph:

“(15) the value (determined under section 4980B(f)(4)) of employer-provided coverage for each month under an accident or health plan and the category of such coverage for purposes of section 6116.”.

(c) Application to retirees.—Subsection (a) of section 6051 is amended by adding at the end the following: “In the case of a retiree, this section shall (to the extent established by the Secretary by regulation) apply only with respect to paragraph (15).”.

(d) Assessable penalties.—

(1) Subparagraph (B) of section 6724(d)(1) is amended by striking “or” at the end of clause (xxiv), by striking “and” at the end of clause (xxv) and inserting “or”, and by adding at the end the following new clause:

“(xxvi) section 6050X (relating to returns relating to payments for qualified health insurance), and”.

(2) Paragraph (2) of section 6724(d) is amended by striking “or” at the end of subparagraph (GG), by striking the period at the end of subparagraph (HH) and inserting “, or” and by adding at the end the following new subparagraph:

“(II) section 6050X(d) (relating to returns relating to payments for qualified health insurance).”.

(e) Clerical amendment.—The table of sections for such subpart B is amended by adding at the end the following new item:

“Sec. 6050X. Coverage under qualified health plan.”.

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

(a) In general.—Subparagraph (B) of section 32(c)(2) is amended by striking “and” at the end of clause (v), by striking the period at the end of clause (vi) and inserting “, and”, and by adding at the end the following new clause:

“(vii) a taxpayer may elect to exclude from earned income amounts that would have been excluded from gross income under section 106 but for subsection (g) thereof.”.

(b) Effective date.—The amendments made by subsection (a) shall apply to taxable years beginning after December 31, 2017.

(a) In general.—Paragraph (3) of section 223(b) is amended by adding at the end the following new subparagraph:

“(C) SPECIAL RULE WHERE BOTH SPOUSES ARE ELIGIBLE INDIVIDUALS WITH 1 ACCOUNT.—If—

“(i) an individual and the individual’s spouse have both attained age 55 before the close of the taxable year, and

“(ii) the spouse is not an account beneficiary of a health savings account as of the close of such year,

the additional contribution amount shall be 200 percent of the amount otherwise determined under subparagraph (B).”.

(b) Effective date.—The amendment made by this section shall apply to taxable years beginning after December 31, 2017.

(a) Individuals over age 65 only enrolled in Medicare Part A.—Paragraph (7) of section 223(b) is amended by adding at the end the following: “This paragraph shall not apply to any individual during any period for which the individual’s only entitlement to such benefits is an entitlement to hospital insurance benefits under part A of title XVIII of such Act pursuant to an enrollment for such hospital insurance benefits under section 226(a)(1) of such Act.”.

(b) Medicare beneficiaries participating in Medicare advantage MSA may contribute their own money to their MSA.—

(1) IN GENERAL.—Subsection (b) of section 138 is amended by striking paragraph (2) and by redesignating paragraphs (3) and (4) as paragraphs (2) and (3), respectively.

(2) CONFORMING AMENDMENT.—Paragraph (4) of section 138(c) is amended by striking “and paragraph (2)”.

(c) Effective date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2017.

(a) In general.—Paragraph (1) of section 223(c) is amended by adding at the end the following new subparagraph:

“(C) SPECIAL RULE FOR INDIVIDUALS ELIGIBLE FOR CERTAIN VETERANS BENEFITS.—For purposes of subparagraph (A)(ii), an individual shall not be treated as covered under a health plan described in such subparagraph merely because the individual receives periodic hospital care or medical services for a service-connected disability under any law administered by the Secretary of Veterans Affairs but only if the individual is not eligible to receive such care or services for any condition other than a service-connected disability.”.

(b) Effective date.—The amendment made by this section shall apply to taxable years beginning after December 31, 2017.

(a) In general.—Paragraph (1) of section 223(c), as amended by this Act, is amended by adding at the end the following new subparagraph:

“(D) SPECIAL RULE FOR INDIVIDUALS ELIGIBLE FOR ASSISTANCE UNDER INDIAN HEALTH SERVICE PROGRAMS.—For purposes of subparagraph (A)(ii), an individual shall not be treated as covered under a health plan described in such subparagraph merely because the individual receives hospital care or medical services under a medical care program of the Indian Health Service or of a tribal organization.”.

(b) Effective date.—The amendment made by this section shall apply to taxable years beginning after December 31, 2017.

(a) In general.—Paragraph (1) of section 223(c), as amended by this Act, is amended by adding at the end the following new subparagraph:

“(E) SPECIAL RULE FOR INDIVIDUALS ELIGIBLE FOR ASSISTANCE UNDER TRICARE.—For purposes of subparagraph (A)(ii), an individual shall not be treated as covered under a health plan described in such subparagraph merely because the individual is eligible to receive hospital care, medical services, or prescription drugs under chapter 55 of title 10, United States Code, under TRICARE Extra or TRICARE Standard and such individual is not enrolled in TRICARE Prime.”.

(b) Effective date.—The amendment made by this section shall apply to taxable years beginning after December 31, 2017.

(a) Eligible individuals include FSA and HRA participants.—Subparagraph (B) of section 223(c)(1) is amended—

(1) by striking “and” at the end of clause (ii),

(2) by striking the period at the end of clause (iii) and inserting “, and”, and

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

“(iv) coverage under a health flexible spending arrangement or a health reimbursement arrangement in the plan year a qualified HSA distribution as described in section 106(e) is made on behalf of the individual if after the qualified HSA distribution is made and for the remaining duration of the plan year, the coverage provided under the health flexible spending arrangement or health reimbursement arrangement is converted to—

“(I) coverage that does not pay or reimburse any medical expense incurred before the minimum annual deductible under paragraph (2)(A)(i) (prorated for the period occurring after the qualified HSA distribution is made) is satisfied,

“(II) coverage that, after the qualified HSA distribution is made, does not pay or reimburse any medical expense incurred after the qualified HSA distribution is made other than preventive care as defined in paragraph (2)(C),

“(III) coverage that, after the qualified HSA distribution is made, pays or reimburses benefits for coverage described in clause (ii) (but not through insurance or for long-term care services),

“(IV) coverage that, after the qualified HSA distribution is made, pays or reimburses benefits for permitted insurance or coverage described in clause (ii) (but not for long-term care services),

“(V) coverage that, after the qualified HSA distribution is made, pays or reimburses only those medical expenses incurred after an individual’s retirement (and no expenses incurred before retirement), or

“(VI) coverage that, after the qualified HSA distribution is made, is suspended, pursuant to an election made on or before the date the individual elects a qualified HSA distribution or, if later, on the date of the individual enrolls in a high deductible health plan, that does not pay or reimburse, at any time, any medical expense incurred during the suspension period except as defined in the preceding subclauses of this clause.”.

(b) Qualified HSA distribution shall not affect flexible spending arrangement.—Paragraph (1) of section 106(e) is amended to read as follows:

“(1) IN GENERAL.—A plan shall not fail to be treated as a health flexible spending arrangement under this section, section 105, or section 125, or as a health reimbursement arrangement under this section or section 105, merely because such plan provides for a qualified HSA distribution.”.

(c) FSA balances at year end shall not forfeit.—Paragraph (2) of section 125(d) is amended by adding at the end the following new subparagraph:

“(E) EXCEPTION FOR QUALIFIED HSA DISTRIBUTIONS.—Subparagraph (A) shall not apply to the extent that there is an amount remaining in a health flexible spending account at the end of a plan year that an individual elects to contribute to a health savings account pursuant to a qualified HSA distribution (as defined in section 106(e)(2)).”.

(d) Simplification of limitations on FSA and HRA rollovers.—Paragraph (2) of section 106(e) is amended to read as follows:

“(2) QUALIFIED HSA DISTRIBUTION.—

“(A) IN GENERAL.—The term ‘qualified HSA distribution’ means a distribution from a health flexible spending arrangement or health reimbursement arrangement to the extent that such distribution does not exceed the lesser of—

“(i) the balance in such arrangement as of the date of such distribution, or

“(ii) the amount determined under subparagraph (B).

Such term shall not include more than 1 distribution with respect to any arrangement.

“(B) DOLLAR LIMITATIONS.—

“(i) DISTRIBUTIONS FROM A HEALTH FLEXIBLE SPENDING ARRANGEMENT.—A qualified HSA distribution from a health flexible spending arrangement shall not exceed the applicable amount.

“(ii) DISTRIBUTIONS FROM A HEALTH REIMBURSEMENT ARRANGEMENT.—A qualified HSA distribution from a health reimbursement arrangement shall not exceed—

“(I) the applicable amount divided by 12, multiplied by

“(II) the number of months during which the individual is a participant in the health reimbursement arrangement.

“(iii) APPLICABLE AMOUNT.—For purposes of this subparagraph, the applicable amount is—

“(I) $2,250 in the case of an eligible individual who has self-only coverage under a high deductible health plan at the time of such distribution, and

“(II) $4,500 in the case of an eligible individual who has family coverage under a high deductible health plan at the time of such distribution.”.

(e) Elimination of additional tax for failure To maintain high deductible health plan coverage.—Subsection (e) of section 106 is amended—

(1) by striking paragraph (3) and redesignating paragraphs (4) and (5) as paragraphs (3) and (4), respectively, and

(2) by striking subparagraph (A) of paragraph (3), as so redesignated, and redesignating subparagraphs (B) and (C) of such paragraph as subparagraphs (A) and (B) thereof, respectively.

(f) Limited purpose FSAs and HRAs.—Subsection (e) of section 106, as amended by this section, is amended by adding at the end the following new paragraph:

“(5) LIMITED PURPOSE FSAS AND HRAS.—A plan shall not fail to be a health flexible spending arrangement or health reimbursement arrangement under this section or section 105 merely because the plan converts coverage for individuals who enroll in a high deductible health plan described in section 223(c)(2) to coverage described in section 223(c)(1)(B)(iv). Coverage for such individuals may be converted as of the date of enrollment in the high deductible health plan, without regard to the period of coverage under the health flexible spending arrangement or health reimbursement arrangement, and without requiring any change in coverage to individuals who do not enroll in a high deductible health plan.”.

(g) Distribution amounts adjusted for cost-of-Living.—Subsection (e) of section 106, as amended by this section, is amended by adding at the end the following new paragraph:

“(6) COST-OF-LIVING ADJUSTMENT.—

“(A) IN GENERAL.—In the case of any taxable year beginning in a calendar year after 2017, each of the dollar amounts in paragraph (2)(B)(iii) shall be increased by an amount equal to such dollar amount, multiplied by the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which such taxable year begins by substituting ‘calendar year 2016’ for ‘calendar year 1992’ in subparagraph (B) thereof.

“(B) ROUNDING.—If any increase under paragraph (1) is not a multiple of $50, such increase shall be rounded to the nearest multiple of $50.”.

(h) Disclaimer of disqualifying coverage.—Subparagraph (B) of section 223(c)(1), as amended by this section, is amended—

(1) by striking “and” at the end of clause (iii),

(2) by striking the period at the end of clause (iv) and inserting “, and”, and

(3) by inserting after clause (iv) the following new clause:

“(v) any coverage (including prospective coverage) under a health plan that is not a high deductible health plan which is disclaimed in writing, at the time of the creation or organization of the health savings account, including by execution of a trust described in subsection (d)(1) through a governing instrument that includes such a disclaimer, or by acceptance of an amendment to such a trust that includes such a disclaimer.”.

(i) Effective date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2017.

(a) In general.—Paragraph (2) of section 223(d) is amended to read as follows:

“(2) QUALIFIED MEDICAL EXPENSES.—

“(A) IN GENERAL.—The term ‘qualified medical expenses’ means, with respect to an account beneficiary, amounts paid by such beneficiary for medical care (as defined in section 213(d)) for any individual covered by a high deductible health plan of the account beneficiary, but only to the extent such amounts are not compensated for by insurance or otherwise.

“(B) HEALTH INSURANCE MAY NOT BE PURCHASED FROM ACCOUNT.—Except as provided in subparagraph (C), subparagraph (A) shall not apply to any payment for insurance.

“(C) EXCEPTIONS.—Subparagraph (B) shall not apply to any expense for coverage under—

“(i) a health plan during any period of continuation coverage required under any Federal law,

“(ii) a qualified long-term care insurance contract (as defined in section 7702B(b)),

“(iii) a health plan during any period in which the individual is receiving unemployment compensation under any Federal or State law,

“(iv) a high deductible health plan, or

“(v) any health insurance under title XVIII of the Social Security Act, other than a Medicare supplemental policy (as defined in section 1882 of such Act).”.

(b) Effective date.—The amendment made by this section shall apply with respect to insurance purchased after the date of the enactment of this Act in taxable years beginning after December 31, 2017.

(a) In general.—Paragraph (2) of section 223(d), as amended by this Act, is amended by adding at the end the following new subparagraph:

“(D) CERTAIN MEDICAL EXPENSES INCURRED BEFORE ESTABLISHMENT OF ACCOUNT TREATED AS QUALIFIED.—An expense shall not fail to be treated as a qualified medical expense solely because such expense was incurred before the establishment of the health savings account if such expense was incurred—

“(i) during either—

“(I) the taxable year in which the health savings account was established, or

“(II) the preceding taxable year in the case of a health savings account established after the taxable year in which such expense was incurred but before the time prescribed by law for filing the return for such taxable year (not including extensions thereof), and

“(ii) for medical care of an individual during a period that such individual was covered by a high deductible health plan and met the requirements of subsection (c)(1)(A)(ii) (after application of subsection (c)(1)(B)).”.

(b) Effective date.—The amendment made by this section shall apply to taxable years beginning after December 31, 2017.

(a) Clarify use of drugs in preventive care.—Subparagraph (C) of section 223(c)(2) is amended by adding at the end the following: “Preventive care shall include prescription and over-the-counter drugs and medicines which have the primary purpose of preventing the onset of, further deterioration from, or complications associated with chronic conditions, illnesses, or diseases.”.

(b) Effective date.—The amendment made by this section shall apply to taxable years beginning after December 31, 2003.

(a) In general.—Section 522 of title 11, United States Code, is amended by adding at the end the following new subsection:

“(r) Treatment of health savings accounts.—For purposes of this section, any health savings account (as described in section 223 of the Internal Revenue Code of 1986) shall be treated in the same manner as an individual retirement account described in section 408 of such Code.”.

(b) Effective date.—The amendment made by this section shall apply to cases commencing under title 11, United States Code, after the date of the enactment of this Act.

(a) In general.—Paragraph (4) of section 223(f) is amended by adding at the end the following new subparagraph:

“(D) EXCEPTION FOR ADMINISTRATIVE ERRORS CORRECTED BEFORE DUE DATE OF RETURN.—Subparagraph (A) shall not apply if any payment or distribution is made to correct an administrative, clerical or payroll contribution error and if—

“(i) such distribution is received by the individual on or before the last day prescribed by law (including extensions of time) for filing such individual’s return for such taxable year, and

“(ii) such distribution is accompanied by the amount of net income attributable to such contribution.

Any net income described in clause (ii) shall be included in the gross income of the individual for the taxable year in which it is received.”.

(b) Effective date.—The amendment made by this section shall take effect on the date of the enactment of this Act.

(a) In general.—Section 1938 of the Social Security Act (42 U.S.C. 1396u–8) is amended—

(1) in subsection (a)—

(A) by striking paragraph (2) and inserting the following:

“(2) INITIAL DEMONSTRATION.—The demonstration program under this section shall begin again on January 1, 2016. The Secretary shall approve States to conduct demonstration programs under this section for a 5-year period, with each State demonstration program covering one or more geographic areas specified by the State. With respect to a State, after the initial 5-year period of any demonstration program conducted under this section by the State, unless the Secretary finds, taking into account cost-effectiveness and quality of care, that the State demonstration program has been unsuccessful, the demonstration program may be extended or made permanent in the State.”; and

(B) in paragraph (3), in the matter preceding subparagraph (A)—

(i) by striking “not”; and

(ii) by striking “unless” and inserting “if ”;

(2) in subsection (b)—

(A) in paragraph (3), by inserting “clause (i) through (vii), (viii) (without regard to the amendment made by section 2004(c)(2) of Public Law 111–148), (x), or (xi) of” after “described in ”; and

(B) by striking paragraphs (4), (5), and (6);

(3) in subsection (c)—

(A) in paragraph (6), by striking “Subject to subparagraphs (D) and (E)” and inserting “Subject to subparagraph (D)”;

(B) by striking paragraphs (3) and (4); and

(C) by redesignating paragraphs (5) through (8) as paragraphs (3) through (6), respectively; and

(4) in subsection (d)—

(A) in paragraph (2), by striking subparagraph (E); and

(B) in paragraph (3)—

(i) in subparagraph (A)(ii), by striking “Subject to subparagraph (B)(ii), in” and inserting “In”; and

(ii) by striking subparagraph (B) and inserting the following:

“(B) MAINTENANCE OF HEALTH OPPORTUNITY ACCOUNT AFTER BECOMING INELIGIBLE FOR PUBLIC BENEFIT.—Notwithstanding any other provision of law, if an account holder of a health opportunity account becomes ineligible for benefits under this title because of an increase in income or assets—

“(i) no additional contribution shall be made into the account under paragraph (2)(A)(i); and

“(ii) the account shall remain available to the account holder for 3 years after the date on which the individual becomes ineligible for such benefits for withdrawals under the same terms and conditions as if the account holder remained eligible for such benefits, and such withdrawals shall be treated as medical assistance in accordance with subsection (c)(4).”.

(b) Conforming amendment.—Section 613 of the Children’s Health Insurance Program Reauthorization Act of 2009 (Public Law 111–3; 42 U.S.C. 1396u–8 note) is repealed.

(a) In general.—Section 223 is amended by adding at the end the following new subsection:

“(i) Application to health care sharing ministries.—For purposes of this section, membership in a health care sharing ministry (as defined in section 5000A(d)(2)(B)(ii)) shall be treated as coverage under a high deductible health plan.”.

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

(a) In general.—Section 223, as amended by this subtitle, is amended by striking “high deductible health plan” each place it appears and inserting “HSA qualified health plan”.

(b) Conforming amendments.—

(1) Section 106(e), as amended by this subtitle, is amended by striking “high deductible health plan” each place it appears and inserting “HSA qualified health plan”.

(2) The heading for paragraph (2) of section 223(c) is amended by striking “High deductible health plan” and inserting “HSA qualified health plan”.

(3) Section 408(d)(9) is amended—

(A) by striking “high deductible health plan” each place it appears in subparagraph (C) and inserting “HSA qualified health plan”, and

(B) by striking “High deductible health plan” in the heading of subparagraph (D) and inserting “HSA qualified health plan”.

(a) In general.—Section 223(c) is amended by adding at the end the following new paragraph:

“(6) TREATMENT OF DIRECT PRIMARY CARE SERVICE ARRANGEMENTS.—An arrangement under which an individual is provided coverage restricted to primary care services in exchange for a fixed periodic fee—

“(A) shall not be treated as a health plan for purposes of paragraph (1)(A)(ii), and

“(B) shall not be treated as insurance for purposes of subsection (d)(2)(B).”.

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

(a) In general.—Subsection (d) of section 213 is amended by adding at the end the following new paragraph:

“(12) EXERCISE EQUIPMENT AND PHYSICAL FITNESS PROGRAMS.—

“(A) IN GENERAL.—The term ‘medical care’ shall include amounts paid—

“(i) to purchase or use equipment used in a program (including a self-directed program) of physical exercise,

“(ii) to participate, or receive instruction, in a program of physical exercise, and

“(iii) for membership dues in a fitness club the primary purpose of which is to provide access to equipment and facilities for physical exercise.

“(B) LIMITATION.—Amounts treated as medical care under subparagraph (A) shall not exceed $1,000 with respect to any individual for any taxable year.”.

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

(a) In general.—Subsection (d) of section 213, as amended by this Act, is amended by adding at the end the following new paragraph:

“(13) NUTRITIONAL AND DIETARY SUPPLEMENTS.—

“(A) IN GENERAL.—The term ‘medical care’ shall include amounts paid to purchase herbs, vitamins, minerals, homeopathic remedies, meal replacement products, and other dietary and nutritional supplements.

“(B) LIMITATION.—Amounts treated as medical care under subparagraph (A) shall not exceed $1,000 with respect to any individual for any taxable year.

“(C) MEAL REPLACEMENT PRODUCT.—For purposes of this paragraph, the term ‘meal replacement product’ means any product that—

“(i) is permitted to bear labeling making a claim described in section 403(r)(3) of the Federal Food, Drug, and Cosmetic Act, and

“(ii) is permitted to claim under such section that such product is low in fat and is a good source of protein, fiber, and multiple essential vitamins and minerals.”.

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

(a) In general.—Subsection (d) of section 213, as amended by this Act, is amended by adding at the end the following new paragraph:

“(14) PERIODIC PROVIDER FEES.—The term ‘medical care’ shall include periodic fees paid to a primary care physician for the right to receive medical services on an as-needed basis.”.

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

(a) Self-Only coverage.—Subparagraph (A) of section 223(b)(2) is amended by striking “$2,250” and inserting “the amount in effect under subsection (c)(2)(A)(ii)(I)”.

(b) Family coverage.—Subparagraph (B) of section 223(b)(2) is amended by striking “$4,500” and inserting “the amount in effect under subsection (c)(2)(A)(ii)(II)”.

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

(a) In general.—Section 223, as amended by this Act, is amended by adding at the end the following new subsection:

“(j) Child health savings accounts.—

“(1) IN GENERAL.—In the case of an individual, in addition to any deduction allowed under subsection (a) for any taxable year, there shall be allowed as a deduction under this section an amount equal to the aggregate amount paid in cash by the taxpayer during the taxable year to a child health savings account of a child of the taxpayer.

“(2) LIMITATION.—The amount taken into account under paragraph (1) with respect to each child of the taxpayer for the taxable year shall not exceed an amount equal to $3,000.

“(3) CHILD HEALTH SAVINGS ACCOUNT.—For purposes of this subsection, the term ‘child health savings account’ means a health savings account designated as a child health savings account and established for the benefit of a child of a taxpayer, but only if—

“(A) such account was established for the benefit of the child before the child attains the age of 5, and

“(B) under the written governing instrument creating the trust, no contribution will be accepted to the extent such contribution, when added to previous contributions to the trust for the calendar year, exceeds the dollar amount in effect under paragraph (2).

“(4) TREATMENT OF ACCOUNT BEFORE AGE 18.—For purposes of this section, except as otherwise provided in this subsection, a child health savings account established for the benefit of the child of a taxpayer shall be treated as a health savings account of the taxpayer until the child attains the age of 18, after which such account shall be treated as a health savings account of the child.

“(5) DISTRIBUTIONS.—

“(A) IN GENERAL.—In the case of a child health savings account established under this section for the benefit of a child of a taxpayer—

“(i) BEFORE AGE 18.—Any amount paid or distributed out of such account before the child has attained the age of 18, shall be included in the gross income of the taxpayer, and subparagraph (A) of subsection (f) shall apply (relating to additional tax on distributions not used for qualified medical expenses).

“(ii) AGE 18 AND OLDER.—Any amount paid or distributed out of such account after the child has attained the age of 18 may only be treated as used to pay qualified medical expenses to the extent such child is not covered as a dependent under insurance (other than permitted insurance) of a parent.

“(B) EXCEPTIONS FOR DISABILITY OR DEATH OF CHILD.—If the child becomes disabled within the meaning of section 72(m)(7) or dies—

“(i) subparagraph (A) shall not apply to any subsequent payment or distribution, and

“(ii) the taxpayer may rollover the amount in such account to an individual retirement plan of the taxpayer, to any health savings account of the taxpayer, or to any child health savings account of any other child of the taxpayer.

“(C) HEALTH INSURANCE MAY BE PURCHASED FROM ACCOUNT.—Subparagraph (B) of subsection (d)(2) shall not apply to any health savings account originally established as a child health savings account.

“(6) REGULATIONS.—The Secretary shall prescribe such regulations as may be necessary to carry out the purposes of this subsection, including rules for determining application of this subsection in the case of legal guardians and in the case of parents of a child who file separately, are separated, or are not married.”.

(b) Effective date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2017.

(a) Transfer from retirement plan.—

(1) INDIVIDUAL RETIREMENT ACCOUNTS.—Section 408(d) is amended by adding at the end the following new paragraph:

“(10) REQUIRED MINIMUM DISTRIBUTION TRANSFERRED TO HEALTH SAVINGS ACCOUNT.—

“(A) IN GENERAL.—In the case of an individual who has attained the age of 70½ and who elects the application of this paragraph for a taxable year, gross income of the individual for the taxable year does not include a qualified HSA transfer to the extent such transfer is otherwise includible in gross income.

“(B) QUALIFIED HSA TRANSFER.—For purposes of this paragraph, the term ‘qualified HSA transfer’ means any distribution from an individual retirement plan—

“(i) to a health savings account of the individual in a direct trustee-to-trustee transfer, and

“(ii) to the extent such distribution does not exceed the required minimum distribution determined under section 401(a)(9) for the distribution calendar year ending during the taxable year.

“(C) APPLICATION OF SECTION 72.—Notwithstanding section 72, in determining the extent to which an amount is treated as a distribution for purposes of paragraph (1), the entire amount of the distribution shall be treated as includible in gross income without regard to paragraph (1) to the extent that such amount does not exceed the aggregate amount which would have been so includible if all amounts in all individual retirement plans of the individual were distributed during such taxable year and all such plans were treated as 1 contract for purposes of determining under section 72 the aggregate amount which would have been so includible. Proper adjustments shall be made in applying section 72 to other distributions in such taxable year and subsequent taxable years.

“(D) COORDINATION.—An election may not be made under subparagraph (A) for a taxable year for which an election is in effect under paragraph (9).”.

(2) OTHER RETIREMENT PLANS.—Section 402 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:

“(m) Required minimum distribution transferred to health savings account.—

“(1) IN GENERAL.—In the case of an individual who has attained the age of 70½ and who elects the application of this subsection for a taxable year, gross income of the individual for the taxable year does not include a qualified HSA transfer to the extent such transfer is otherwise includible in gross income.

“(2) QUALIFIED HSA TRANSFER.—For purposes of this subsection, the term ‘qualified HSA transfer’ means any distribution from an individual retirement plan—

“(A) to a health savings account of the individual in a direct trustee-to-trustee transfer, and

“(B) to the extent such distribution does not exceed the required minimum distribution determined under section 401(a)(9) for the distribution calendar year ending during the taxable year.

“(3) APPLICATION OF SECTION 72.—Notwithstanding section 72, in determining the extent to which an amount is treated as a distribution for purposes of paragraph (1), the entire amount of the distribution shall be treated as includible in gross income without regard to paragraph (1) to the extent that such amount does not exceed the aggregate amount which would have been so includible if all amounts in all eligible retirement plans of the individual were distributed during such taxable year and all such plans were treated as 1 contract for purposes of determining under section 72 the aggregate amount which would have been so includible. Proper adjustments shall be made in applying section 72 to other distributions in such taxable year and subsequent taxable years.

“(4) ELIGIBLE RETIREMENT PLAN.—For purposes of this subsection, the term ‘eligible retirement plan’ has the meaning given such term by subsection (c)(8)(B) (determined without regard to clauses (i) and (ii) thereof).”.

(b) Transfer to health savings account.—

(1) IN GENERAL.—Subparagraph (A) of section 223(d)(1) is amended by striking “or” at the end of clause (i), by striking the period at the end of clause (ii)(II) and inserting “, or”, and by adding at the end the following new clause:

“(iii) unless it is in a qualified HSA transfer described in section 408(d)(10) or 402(m).”.

(2) EXCISE TAX INAPPLICABLE TO QUALIFIED HSA TRANSFER.—Paragraph (1) of section 4973(g) is amended by inserting “or in a qualified HSA transfer described in section 408(d)(10) or 402(m)” after “or 223(f)(5)”.

(c) Effective date.—The amendments made by this section shall apply to distributions made after the date of the enactment of this Act, in taxable years ending after such date.

(a) In general.—Subsection (f) of section 223 is amended by adding at the end the following new paragraph:

“(9) EXCEPTION FOR CERTAIN ABORTION EXPENSES.—

“(A) IN GENERAL.—Notwithstanding paragraph (1), any amount used to pay for an abortion (other than an abortion described in subparagraph (B)) shall be included in the gross income of such beneficiary.

“(B) EXCEPTIONS.—Subparagraph (A) shall not apply to—

“(i) an abortion—

“(I) in the case of a pregnancy that 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, and

“(ii) the treatment of any infection, injury, disease, or disorder that has been caused by or exacerbated by the performance of an abortion.”.

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

(a) Limitation on exception for wellness programs under HIPAA discrimination rules.—

(1) EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974 AMENDMENT.—Section 702(b)(2) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1182(b)(2)) is amended by adding at the end the following flush sentence:

“In applying subparagraph (B), a group health plan (or a health insurance issuer with respect to health insurance coverage) may vary premiums and cost-sharing by up to 50 percent of the value of the benefits under the plan (or coverage) based on participation (or lack of participation) in a standards-based wellness program.”.

(2) PHSA AMENDMENT.—Section 2705(b)(2) of the Public Health Service Act (42 U.S.C. 300gg–4(b)(2)) is amended by adding at the end the following flush sentence:

“In applying subparagraph (B), a group health plan (or a health insurance issuer with respect to health insurance coverage) may vary premiums and cost-sharing by up to 50 percent of the value of the benefits under the plan (or coverage) based on participation (or lack of participation) in a standards-based wellness program.”.

(3) IRC AMENDMENT.—Section 9802(b)(2) of the Internal Revenue Code of 1986 is amended by adding at the end the following flush sentence:

“In applying subparagraph (B), a group health plan may vary premiums and cost-sharing by up to 50 percent of the value of the benefits under the plan based on participation (or lack of participation) in a standards-based wellness program.”.

(b) Effective date.—The amendments made by subsection (a) shall apply to plan years beginning more than 1 year after the date of the enactment of this Act.

(a) In general.—Section 2741(b) of the Public Health Service Act (42 U.S.C. 300gg–41(b)) is amended—

(1) in paragraph (1)—

(A) by striking “(1)(A)” and inserting “(1)”; and

(B) by striking “and (B)” and all that follows up to the semicolon at the end;

(2) by adding “and” at the end of paragraph (2);

(3) in paragraph (3)—

(A) by striking “(1)(A)” and inserting “(1)”; and

(B) by striking the semicolon at the end and inserting a period; and

(4) by striking paragraphs (4) and (5).

(b) Effective date.—The amendments made by subsection (a) shall take effect 2 years after the date of the enactment of this Act.

Section 2745 of the Public Health Service Act (42 U.S.C. 300gg–45) is amended—

(1) in subsection (a), by adding at the end the following: “The Secretary shall provide from the funds appropriated under subsection (d)(3)(A) a grant of up to $5,000,000 to each State that has not created a qualified high-risk pool as of September 1, 2017, for the State's costs of creation and initial operation of such a pool.”;

(2) in paragraphs (1) and (2) of subsection (b), by striking “and (2)(A)” and inserting “(2)(A), (3)(B), and (4)” each place it appears;

(3) in subsection (b)(3), by inserting “with respect to funds made available for fiscal years before fiscal year 2016,”after “applicable standard risks,”;

(4) by adding at the end of subsection (b) the following new paragraph:

“(5) VERIFICATION OF CITIZENSHIP OR ALIEN QUALIFICATION.—

“(A) IN GENERAL.—Notwithstanding any other provision of law, effective upon the date of the enactment of this paragraph, only citizens and nationals of the United States shall be eligible to participate in a qualified high-risk pool that receives funds under this section.

“(B) CONDITION OF PARTICIPATION.—As a condition of a State receiving such funds under this subsection for a fiscal year beginning with fiscal year 2018, the Secretary shall require the State to certify, to the satisfaction of the Secretary, that such State requires all applicants for coverage in the qualified high-risk pool to provide satisfactory documentation of citizenship or nationality in a manner consistent with section 1903(x) of the Social Security Act.

“(C) RECORDS.—The Secretary shall keep sufficient records such that a determination of citizenship or nationality only has to be made once for any individual under this paragraph.”; and

(5) in subsection (d)—

(A) in paragraphs (1)(B) and (2) by striking “paragraph (4)” and inserting “paragraph (6)”;

(B) in paragraph (4), by striking “or (2)” and inserting “(2), (3)(B), or (4)”;

(C) by redesignating paragraphs (3) through (5) as paragraphs (5) through (7), respectively; and

(D) by inserting after paragraph (2) the following:

“(3) AUTHORIZATION OF APPROPRIATIONS FOR FISCAL YEAR 2018.—There are authorized to be appropriated for fiscal year 2018—

“(A) $50,000,000 to carry out the second sentence of subsection (a); and

“(B) $2,450,000,000 which, subject to paragraph (6), shall be made available for allotments under subsection (b)(2).

“(4) AUTHORIZATION OF APPROPRIATIONS FOR FISCAL YEARS 2019 THROUGH 2027.—There are authorized to be appropriated $2,500,000,000 for each of fiscal years 2019 through 2027 which, subject to paragraph (6), shall be made available for allotments under subsection (b)(2).”.

(a) In General.—Title XXVII of the Public Health Service Act (42 U.S.C. 300gg et seq.) is amended by adding at the end the following new part:

(b) Effective Date.—The amendment made by subsection (a) shall apply to individual health insurance coverage offered, issued, or sold after the date that is one year after the date of the enactment of this Act.

(c) GAO Ongoing Study and Reports.—

(1) STUDY.—The Comptroller General of the United States shall conduct an ongoing study concerning the effect of the amendment made by subsection (a) on—

(A) the number of uninsured and under-insured;

(B) the availability and cost of health insurance policies for individuals with pre-existing medical conditions;

(C) the availability and cost of health insurance policies generally;

(D) the elimination or reduction of different types of benefits under health insurance policies offered in different States; and

(E) cases of fraud or abuse relating to health insurance coverage offered under such amendment and the resolution of such cases.

(2) ANNUAL REPORTS.—The Comptroller General shall submit to Congress an annual report, after the end of each of the 5 years following the effective date of the amendment made by subsection (a), on the ongoing study conducted under paragraph (1).

(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). For purposes of the preceding sentence, the term ‘antitrust laws’ has the meaning given it in subsection (a) of the first section of the Clayton Act, except that such term includes section 5 of the Federal Trade Commission Act to the extent that such section 5 applies to unfair methods of competition.

“(2) For purposes of paragraph (1), the term ‘business of health insurance (including the business of dental insurance)’ does not include—

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

“(B) the business of property or casualty insurance, including but not limited to, any insurance or benefits defined as ‘excepted benefits’ under paragraph (1), subparagraphs (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.”.

(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.

(a) In general.—Section 1128J of the Social Security Act (42 U.S.C. 1320a–7k) is amended by adding at the end the following new subsection:

“(f) Public availability of medicare claims data.—

“(1) IN GENERAL.—The Secretary shall, to the extent consistent with applicable information, privacy, security, and disclosure laws, including the regulations promulgated under the Health Insurance Portability and Accountability Act of 1996 and section 552a of title 5, United States Code, make available to the public claims and payment data of the Department of Health and Human Services related to title XVIII, including data on payments made to any provider of services or supplier under such title.

“(2) IMPLEMENTATION.—

“(A) IN GENERAL.—Not later than December 31, 2017, the Secretary shall promulgate regulations to carry out this subsection.

“(B) REQUIREMENTS.—The regulations promulgated under subparagraph (A) shall ensure that—

“(i) the data described in paragraph (1) is made available to the public through a searchable database that the public can access at no cost;

“(ii) such database—

“(I) includes the amount paid to each provider of services or supplier under title XVIII, the items or services for which such payment was made, and the location of the provider of services or supplier;

“(II) is organized based on the specialty or the type of provider of services or supplier involved;

“(III) is searchable based on the type of items or services furnished; and

“(IV) includes a disclaimer that the aggregate data in the database does not reflect on the quality of the items or services furnished or of the provider of services or supplier who furnished the items or services; and

“(iii) each provider of services or supplier in the database is identified by a unique identifier that is available to the public (such as the National Provider Identifier of the provider of services or supplier).

“(C) SCOPE OF DATA.—The database shall include data for fiscal year 2018, and each year fiscal year thereafter.”.

(b) Information not exempt under the Freedom of Information Act.—The term “personnel and medical files and similar files the disclosure of which would constitute a clearly unwarranted invasion of personal privacy”, as used in section 552(b)(6) of title 5, United States Code, does not include the information required to be made available to the public under section 1128J(f) of the Social Security Act, as added by subsection (a).

(a) State-Based portal.—A State (by itself or jointly with other States) may contract with a private entity to establish a Health Plan and Provider Portal Web site (referred to in this section as a “plan portal”) for the purposes of providing standardized information—

(1) on health insurance plans that have been certified to be available for purchase in that State; and

(2) on price and quality information on health care providers (including physicians, hospitals, and other health care institutions).

(b) Prohibitions.—

(1) DIRECT ENROLLMENT.—A plan portal may not directly enroll individuals in health insurance plans or under a State Medicaid plan or a State children’s health insurance plan.

(2) CONFLICTS OF INTEREST.—

(A) COMPANIES.—A health insurance issuer offering a health insurance plan through a plan portal may not—

(i) be the private entity developing and maintaining a plan portal under this section; or

(ii) have an ownership interest in such private entity or in the plan portal.

(B) INDIVIDUALS.—An individual employed by a health insurance issuer offering a health insurance plan through a plan portal may not serve as a director or officer for—

(i) the private entity developing and maintaining a plan portal under this section; or

(ii) the plan portal.

(c) Construction.—Nothing in this section shall be construed to prohibit health insurance brokers and agents from—

(1) utilizing the plan portal for any purpose; or

(2) marketing or offering health insurance products.

(d) State defined.—In this section, the term “State” has the meaning given such term for purposes of title XIX of the Social Security Act.

(e) Health insurance plans.—For purposes of this section, the term “health insurance plan” does not include coverage of excepted benefits, as defined in section 2791(c) of the Public Health Service Act (42 U.S.C. 300gg–91(c)).

(f) Authorization of appropriations.—There are authorized to be appropriated $50,000,000 for fiscal year 2018 to provide funding for the Secretary of Health and Human Services to award grants to States to enter into contracts to establish a portal plan under this section, to remain available until expended.

Nothing in this Act shall be construed to interfere with the doctor-patient relationship or the practice of medicine.

Effective on the date of the enactment of this Act, section 804 of the American Recovery and Reinvestment Act of 2009 (42 U.S.C. 299b–8) is repealed.

(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, 2019, the Secretary of Labor shall report to the Committee on Education and the Workforce 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 such Act (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 such Act (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 subtitle 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 subtitle 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.

Section 101(b)(2) of the Veterans Access, Choice, and Accountability Act of 2014 (Public Law 113–146; 38 U.S.C. 1701 note) is amended—

(1) in subparagraph (C)(ii), by striking the “or” at the end;

(2) in subparagraph (D)(ii)(II), by striking the period at the end and inserting “; or”; and

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

“(E) is a veteran described in section 1705(a)(1) of title 38, United States Code, or a veteran who was awarded the medal of honor under section 3741, 6241, or 8741 of title 10 or section 491 of title 14.”.

(a) Selection.—Not later than 6 months after the date of enactment of this Act, eligible professional organizations that have established, published, maintained, and updated on a regular basis, clinical practice guidelines, including when applicable, appropriate use criteria, that incorporate best practices, may submit such guidelines to the Secretary. Not later than 6 months after the last day for submitting such guidelines, the Secretary shall select and designate one or more eligible professional organizations to provide and maintain such clinical practice guidelines on behalf of the Secretary. Not later than 6 months after designating each such eligible professional organization, the Secretary shall enter into an agreement with each such eligible professional organization for maintenance, publication, and updating of such clinical practice guidelines.

(b) Maintenance.—

(1) PERIODIC REVIEW.—Not later than 5 years the Secretary enters into an agreement with each eligible professional organization under subsection (a), and every 5 years thereafter, the Secretary shall review the clinical practice guidelines of such organization and shall, as necessary, enter into agreements with additional eligible professional organizations, as appropriate, in accordance with subsection (a).

(2) UPDATE BY ELIGIBLE PROFESSIONAL ORGANIZATION.—An eligible professional organization that collaborated in the establishment of a clinical practice guidelines may submit amendments to that clinical practice guideline at any time to the Secretary for review by the Secretary.

(3) NOTIFICATION REQUIRED FOR CERTAIN UPDATES.—An amendment under paragraph (2) may not add, materially change, or remove a guideline from a set of guidelines, unless notification of such update is made available to applicable eligible professionals.

(a) Guideline standards.—The Secretary shall ensure that, to the extent practicable, the development of clinical practice guidelines are guided by the Standards for Developing Trustworthy Clinical Practice Guidelines of the Institute of Medicine and—

(1) are developed through a transparent process that minimizes conflicts of interest;

(2) are developed by a knowledgeable, multidisciplinary panel of experts and representatives from key affected groups;

(3) take into consideration important patient subgroups and patient preferences, as appropriate;

(4) are based on a systematic review of the existing evidence;

(5) provide a clear explanation of the relationship between care options and health outcomes;

(6) provide ratings of both the quality of evidence and strength of recommendation;

(7) are reconsidered and revised when new evidence emerges; and

(8) clearly identify any exceptions to the application of the clinical practice guideline.

(b) Required disclosures from eligible professional organizations.—Any person who is affiliated with an eligible professional organization and who directly participated in the creation of a clinical practice guideline shall disclose any conflicts of interest pertaining to the development of the clinical practice guideline, including any conflict of interest pertaining to any instrument, medicine, drug, or any other substance, device, or means included in the clinical practice guideline. Disclosures to the Secretary by eligible professional organizations shall be made promptly, upon submission of the guidelines, and during every review of the guidelines. Disclosures shall include the following:

(1) Scientific methodology and evidence that supports clinical practice guidelines.

(2) Outside collaborators.

(3) Endorsements.

Neither an eligible professional organization nor the participants in its guideline development and approval process, may be held liable for any injury alleged to be caused by adhering to a clinical practice guideline to which they contributed.

The Secretary shall publish on the Internet through the National Guideline Clearinghouse or other appropriate sites or sources, all clinical practice guidelines, including all data and methodology used in the development and selection of the guidelines in compliance with data disclosure standards in the Health Insurance Portability and Accountability Act of 1996 (Public Law 104–191).

(a) Limitation.—This Act shall not preempt or supersede any State or Federal law that—

(1) imposes procedural or substantive protections for health care providers and health care organizations from liability, loss, or damages greater than such protections provided by this title; or

(2) creates a cause of action related to the provision of health care goods or services.

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

(a) In general.—Chapter 85 of title 28, United States Code, is amended by adding at the end the following:

(b) Technical and conforming amendment.—The table of sections for chapter 85 of title 28, United States Code, is amended by adding at the end the following:

“1370. Health care liability claims.”.

Section 1441 of title 28, United States Code, is amended by adding at the end the following:

“(g) Certain actions against medical professionals.— (1) A health care liability action brought in a State court against an applicable eligible professional, health care provider, or health care organization may be removed by any defendant or the defendants to the district court of the United States for the district and division embracing the place where such action is pending.

“(2) In this subsection, the terms ‘applicable eligible professional’, ‘health care liability action’, ‘health care organization’, and ‘health care provider’ have the meaning given such terms in section 10 of the Saving Lives, Saving Costs Act.”.

(a) In general.—If, in any health care liability action removed to Federal court pursuant to section 1441(g) of title 28, United States Code, against an applicable eligible professional, health care provider, or health care organization, the applicable eligible professional, health care provider, or health care organization alleges, in response to a filing of the claimant, that the applicable eligible professional, health care provider, or health care organization adhered to an applicable clinical practice guideline in the provision of health care goods or services to the claimant, then the court shall suspend further proceedings on the health care liability action prior to discovery proceedings, until the completion of a review of the action by an independent medical review panel.

(b) Independent medical review panel.—

(1) COMPOSITION.—An independent medical review panel under this section shall be composed of 3 members who are experts in the relevant field of clinical practice, appointed in accordance with paragraph (5).

(2) REQUIREMENTS FOR MEMBER ELIGIBILITY.—

(A) IN GENERAL.—To be eligible to serve on an independent medical review panel, a member shall—

(i) be an experienced physician certified by a board recognized by the American Board of Medical Specialties;

(ii) not earlier than 2 years prior to the date of selection to the board, have been in active medical practice or devoted a substantial portion of his or her time to teaching at an accredited medical school, or have been engaged in university-based research in relation to the medical care and type of treatment at issue; and

(iii) be approved by his or her specialty society.

(B) REGIONAL PREFERENCE.—When possible, members should be from the region where the case in question originates to account for geographical practice variation.

(3) NO CIVIL LIABILITY FOR MEMBERS.—No civil action shall be brought in any court against any member for any act, failure to act, or statement or opinion made, within the scope of his or her duties as a member of the independent medical review panel.

(4) CONSIDERATIONS IN MAKING DETERMINATIONS.—The members of the independent medical review panel shall acknowledge that, under certain circumstances, it may be appropriate for a physician to depart from the recommendations in clinical practice guidelines in the care of individual patients.

(5) SELECTION OF MEMBERS.—Each member of the independent medical review panel shall be jointly selected by the parties. A member whose selection one party does not concur in may not serve on the panel, except that, if, not later than 30 days after a response to the health care liability action is filed, 3 members have not been selected by the parties, the court shall appoint any remaining members.

(6) COMPENSATION OF MEMBERS.—The costs of compensation to the members of the independent medical review panel shall be shared between the parties equally, unless otherwise agreed to by the parties.

(c) Terms of review.—A review by an independent medical review panel under this section shall comply with the following:

(1) STANDARD OF CONDUCT.—The mandatory independent medical review panel that is charged with the responsibility of making a preliminary finding as to liability of the defendant applicable eligible professional shall deem the prescribed clinical practice guidelines as the standard of conduct, care, and skill expected of members of the medical profession engaged in the defendant’s field of practice under the same or similar circumstances, subject to the provisions of subsection (b)(4).

(2) RECORD FOR REVIEW.—The independent medical review panel shall make a preliminary finding based solely upon the pre-discovery evidence submitted to it pursuant to Rule 26 of the Federal Rules of Civil Procedure, any medical records that would be discoverable if the lawsuit advances to trial, and the applicable prescribed clinical practice guidelines.

(3) LIMITATION.—The independent medical review panel shall not make a finding of negligence from the mere fact that a treatment or procedure was unsuccessful or failed to bring the best result, or that the patient died.

(4) USE AT TRIAL OF WORK PRODUCT OF REVIEW PANEL.—No preliminary finding by the independent medical review panel that the defendant applicable eligible professional breached the standard of care as set forth under the prescribed clinical practice guidelines shall constitute negligence per se or conclusive evidence of liability, but findings, opinions, and conclusions of the review panel shall be admissible as evidence in any and all subsequent proceedings before the court, including for purposes of motions for summary judgment and at trial.

(d) Results of review.—

(1) IN GENERAL.—Not later than 60 days after all members of the independent medical review panel have been selected, the panel shall complete a review of the record of the liability action and shall make a finding under this subsection.

(2) FINDING DESCRIBED.—A finding under this subsection shall include the following:

(A) A determination of whether there are any applicable clinical practice guidelines to the health care liability action that substantively pertains to the injury suffered by the claimant.

(B) Whether the applicable eligible professional has alleged adherence to any such guideline.

(C) Whether the applicable eligible professional adhered to any such guideline.

(D) Whether there is a reasonable probability that—

(i) the applicable eligible professional violated the applicable clinical practice guideline;

(ii) that violation proximately caused the claimant’s alleged injury; and

(iii) the claimant suffered damages as a result of the injury.

(3) USE AT TRIAL.—The finding under this subsection may be received into evidence by the court. If the independent medical review panel made any finding under paragraph (2)(D) that there was no reasonable probability of the matters described in clauses (i) through (iii), the court may issue a summary judgment in favor of the applicable eligible professional unless the claimant is able to show otherwise by clear and convincing evidence. If the panel made a finding under subparagraphs (A) through (C) of paragraph (2) that there was an applicable clinical practice guideline that the defendant adhered to, the court shall issue summary judgment in favor of the applicable eligible professional unless the claimant is able to show otherwise by clear and convincing evidence. Any preliminary finding that the defendant applicable eligible professional did not breach the standard of care as set forth under the prescribed medical practice guidelines or that the defendant applicable eligible professional's nonadherence to the applicable standard was neither the cause in fact nor the proximate cause of the plaintiff's injury or that the plaintiff did not incur any damages as a result shall be given deference by the court and shall entitle the defendant applicable eligible professional to summary judgment unless the plaintiff is able to show by clear and convincing evidence that the independent medical review panel was in error and that there is a genuine issue as to a material fact in the case.

In this Act:

(1) APPLICABLE ELIGIBLE PROFESSIONAL.—The term “applicable eligible professional” means a physician practicing within clinical practice guidelines submitted by an eligible professional organization and includes employees and agents of a physician.

(2) APPROPRIATE USE CRITERIA.—The term “appropriate use criteria” means established evidence-based guidelines developed or endorsed by an eligible professional organization that specify when the health benefits of a procedure or service exceed the expected health risks by a significantly wide margin.

(3) CLINICAL PRACTICE GUIDELINE.—The term “clinical practice guideline” means systematically developed statements based on the review of clinical evidence for assisting a health care provider to determine the appropriate health care in specific clinical circumstances.

(4) ELIGIBLE PROFESSIONAL ORGANIZATION.—The term “eligible professional organization” means a national or State medical society or medical specialty society.

(5) FEDERAL PAYOR.—The term “Federal payor” includes reimbursements made under the Medicare program under title XVIII of the Social Security Act or the Medicaid program under title XIX of the Social Security Act, or medical screenings, treatments, or transfer services provided pursuant to section 1867 of the Social Security Act is not made by the individual or any non-Federal third party on behalf of the individual.

(6) HEALTH CARE GOODS OR SERVICES.—The term “health care goods or services” means any goods or services provided by a health care organization, 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.

(7) HEALTH CARE LIABILITY ACTION.—The term “health care liability action” means a civil action against an applicable eligible professional, a health care provider, or a health care organization, 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.

(8) HEALTH CARE LIABILITY CLAIM.—The term “health care liability claim” means a claim by any person against an applicable eligible professional, a health care provider, or a health care organization which is based upon the provision of, use of, or payment for (or the failure to provide, use, or pay for) health care goods or services for which at least partial payment was made by a Federal payor or which was mandated by Federal law, regardless of the theory of liability on which the claim is based.

(9) HEALTH CARE ORGANIZATION.—The term “health care organization” means any person or entity which is obligated to provide or pay for health benefits under any health plan, including any person or entity acting under a contract or arrangement with a health care organization to provide or administer any health benefit.

(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.

(11) SECRETARY.—The term “Secretary” means the Secretary of Health and Human Services.

(a) Prohibition on abortion mandates.—Nothing in this Act (or any amendment made by this Act) shall be construed to require any health plan (including any high-risk pool) to provide coverage of, or access to, abortion services or to allow the Secretary of the Treasury, the Secretary of Labor, the Secretary of Health and Human Services, or any other Federal or non-Federal person or entity in implementing this Act (or an amendment made by this Act) to require coverage of, or access to, abortion services.

(b) Prohibition on certain research funding.—

(1) IN GENERAL.—No funds authorized or appropriated by this Act (or an amendment made by this Act) may be used to conduct or support research that includes embryo-destructive stem cell research and human cloning.

(2) HUMAN CLONING DEFINED.—In this subsection, the term “human cloning” means human asexual reproduction accomplished by introducing the nuclear material from a human diploid cell into an oocyte to produce a living organism at any stage of development with a human or predominantly human genetic constitution.

(3) CONSTRUCTION.—Nothing in this subsection may be construed to prohibit conducting or supporting research that does not include embryo-destructive stem cell research or human cloning, including research involving nuclear transfer or other cloning techniques to produce molecules, DNA, cells other than human embryos, tissues, or animals other than humans.

(c) Limitation on abortion funding.—

(1) IN GENERAL.—No funds authorized or appropriated by this Act (or an amendment made by this Act) may be used to pay for any abortion or to cover any part of the costs of any health plan that includes coverage of abortion (including a high-risk pool described in section 2745 of the Public Health Service Act (42 U.S.C. 300gg–45), as amended by section 311 of this Act), except—

(A) if the pregnancy is the result of an act of rape or incest; or

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

(2) OPTION TO PURCHASE SEPARATE COVERAGE OR PLAN.—Nothing in this subsection shall be construed as prohibiting any non-Federal entity (including an individual or a State or local government) from purchasing separate coverage for abortions for which funding is prohibited under this subsection, or a health plan that includes such abortions, so long as such coverage or plan is paid for entirely using only funds not authorized or appropriated by this Act.

(3) OPTION TO OFFER COVERAGE OR PLAN.—Nothing in this subsection shall restrict any non-Federal health insurance issuer offering a health plan from offering separate coverage for abortions for which funding is prohibited under this subsection, or a health plan that includes such abortions, so long as—

(A) premiums for such separate coverage or plan are paid for entirely with funds not authorized or appropriated by this Act; and

(B) administrative costs and all services offered through such coverage or plan are paid for using only premiums collected for such coverage or plan.

(4) ADMINISTRATIVE EXPENSES.—No funds authorized or appropriated by this Act shall be available to pay for administrative expenses in connection with any health plan (including an association health plan that has entered into trusteeship) which provides any benefits or coverage for abortions except where the life of the mother would be endangered if the fetus were carried to term, or the pregnancy is the result of an act of rape or incest.

(d) No preemption of State laws.—Nothing in this Act (or an amendment made by this Act) shall be construed to preempt or otherwise have any effect on State laws—

(1) protecting conscience rights or restricting or prohibiting abortion or coverage or funding of abortion, as in effect on the date of the enactment of this Act; or

(2) establishing procedural requirements on abortions, including parental notification or consent for the performance of an abortion on a minor.

(e) Definitions.—In this section:

(1) The term “association health plan” has the meaning given to such term in section 801 of the Employee Retirement Income Security Act of 1974, as added by section 451 of this Act.

(2) The term “high-risk pool” means a high-risk pool described in section 2745 of the Public Health Service Act (42 U.S.C. 300gg–45), as amended by section 311 of this Act.

Section 251(c) of the Balanced Budget and Emergency Deficit Control Act of 1985 (2 U.S.C. 901) is amended as follows:

(1) In paragraph (5)(B), by striking the dollar amount and inserting “$507,300,000,000”.

(2) In paragraph (6)(B), by striking the dollar amount and inserting “$523,700,000,000”.

(3) In paragraph (7)(B), by striking the dollar amount and inserting “$534,900,000,000”.

(4) In paragraph (8)(B), by striking the dollar amount and inserting “$546,700,000,000”.