H.R. 1628 — what changed

added “(XXIII) beginning January 1, 2020—

added “(aa) who are expansion enrollees (as defined in subsection (nn)(1)); or

added “(bb) who are grandfathered expansion enrollees (as defined in subsection (nn)(2));”

added “(nn) Expansion enrollees—In this title:

added “(1) In general—The term expansion enrollee means an individual—

added “(A) who is under 65 years of age;

added “(B) who is not pregnant;

added “(C) who is not entitled to, or enrolled for, benefits under part A of title XVIII, or enrolled for benefits under part B of title XVIII;

added “(D) who is not described in any of subclauses (I) through (VII) of subsection (a)(10)(A)(i); and

added “(E) whose income (as determined under subsection (e)(14)) does not exceed 133 percent of the poverty line (as defined in section 2110(c)(5)) applicable to a family of the size involved.

added “(2) Grandfathered expansion enrollees—The term grandfathered expansion enrollee means an expansion enrollee who—

added “(A) was enrolled under the State plan under this title (or under a waiver of such plan) as of December 31, 2019; and

added “(B) does not have a break in eligibility for medical assistance under such State plan (or waiver) for more than one month after such date.

added “(3) Application of related provisions—Any reference in subsection (a)(10)(G), (k), or (gg) of this section or in section 1903, 1905(a), 1920(e), or 1937(a)(1)(B) to individuals described in subclause (VIII) of subsection (a)(10)(A)(i) shall be deemed to include a reference to expansion enrollees (including grandfathered expansion enrollees).”

“(IV) 2017 and each subsequent year is 80 percent.”

Section 1923(f) of the Social Security Act (42 U.S.C. 1396r–4(f)) is amended—

changed “(C) Exemption from exemption Reduction for non-expansion States

“(i) In general—In the case of a State that is a non-expansion State for a fiscal year, subparagraph (A)(i) shall not apply to the DSH allotment for such State and fiscal year.

“(ii) No change in reduction for expansion States—In the case of a State that is an expansion State for a fiscal year, the DSH allotment for such State and fiscal year shall be determined as if clause (i) did not apply.

“(iii) Non-expansion and expansion State defined

“(I) The term “expansion State” means with respect to a fiscal year, a State that, as of July 1 of the preceding fiscal year, provides for eligibility under clause (i)(VIII) or (ii)(XX) of section 1902(a)(10)(A) for medical assistance under this title (or a waiver of the State plan approved under section 1115).

“(II) The term “non-expansion State” means, with respect to a fiscal year, a State that is not an expansion State.”

“(J) Treatment of certain lottery winnings and income received as a lump sum

“(i) In general—In the case of an individual who is the recipient of qualified lottery winnings (pursuant to lotteries occurring on or after January 1, 2020) or qualified lump sum income (received on or after such date) and whose eligibility for medical assistance is determined based on the application of modified adjusted gross income under subparagraph (A), a State shall, in determining such eligibility, include such winnings or income (as applicable) as income received—

“(I) in the month in which such winnings or income (as applicable) is received if the amount of such winnings or income is less than $80,000;

“(II) over a period of 2 months if the amount of such winnings or income (as applicable) is greater than or equal to $80,000 but less than $90,000;

“(III) over a period of 3 months if the amount of such winnings or income (as applicable) is greater than or equal to $90,000 but less than $100,000; and

“(IV) over a period of 3 months plus 1 additional month for each increment of $10,000 of such winnings or income (as applicable) received, not to exceed a period of 120 months (for winnings or income of $1,260,000 or more), if the amount of such winnings or income is greater than or equal to $100,000.

“(ii) Counting in equal installments—For purposes of subclauses (II), (III), and (IV) of clause (i), winnings or income to which such subclause applies shall be counted in equal monthly installments over the period of months specified under such subclause.

“(iii) Hardship exemption—An individual whose income, by application of clause (i), exceeds the applicable eligibility threshold established by the State, may continue to be eligible for medical assistance to the extent that the State determines, under procedures established by the State under the State plan (or in the case of a waiver of the plan under section 1115, incorporated in such waiver), or as otherwise established by such State in accordance with such standards as may be specified by the Secretary, that the denial of eligibility of the individual would cause an undue medical or financial hardship as determined on the basis of criteria established by the Secretary.

“(iv) Notifications and assistance required in case of loss of eligibility—A State shall, with respect to an individual who loses eligibility for medical assistance under the State plan (or a waiver of such plan) by reason of clause (i), before the date on which the individual loses such eligibility, inform the individual of the date on which the individual would no longer be considered ineligible by reason of such clause to receive medical assistance under the State plan or under any waiver of such plan and the date on which the individual would be eligible to reapply to receive such medical assistance.

“(v) Qualified lottery winnings defined—In this subparagraph, the term qualified lottery winnings means winnings from a sweepstakes, lottery, or pool described in paragraph (3) of section 4402 of the Internal Revenue Code of 1986 or a lottery operated by a multistate or multijurisdictional lottery association, including amounts awarded as a lump sum payment.

“(vi) Qualified lump sum income defined—In this subparagraph, the term qualified lump sum income means income that is received as a lump sum from one of the following sources:

“(I) Monetary winnings from gambling (as defined by the Secretary and including monetary winnings from gambling activities described in section 1955(b)(4) of title 18, United States Code).

“(II) Income received as liquid assets from the estate (as defined in section 1917(b)(4)) of a deceased individual.”

removed “(2)

removed “(A) Subparagraphs (A) and (B)(ii) of subsection (d)(4) shall not apply in the case of an initial determination made on or after the date that is 6 months after the date of the enactment of this paragraph with respect to the eligibility of an alien described in subparagraph (B) for benefits under the program listed in subsection (b)(2).

removed “(B) An alien described in this subparagraph is an individual declaring to be a citizen or national of the United States with respect to whom a State, in accordance with section 1902(a)(46)(B), requires—

removed “(i) pursuant to 1902(ee), the submission of a social security number; or

removed “(ii) pursuant to 1903(x), the presentation of satisfactory documentary evidence of citizenship or nationality.”

removed “(B) in the case of a State that elects to provide a reasonable period to present satisfactory documentary evidence of such citizenship or nationality pursuant to paragraph (2)(C) of section 1902(ee) or paragraph (4) of subsection (x) of this section, for amounts expended for medical assistance for such an individual (other than an individual described in paragraph (2) of such subsection (x)) during such period;”

Title XIX of the Social Security Act is amended by inserting after section 1923 (42 U.S.C. 1396r–4) the following new section:

“1923A. Adjustment in payment for services of safety net providers in non-expansion States

changed “(a) In general—Subject to the limitations of this section, for each year during the period beginning with fiscal year 2018 and ending with 2021, fiscal year 2022, each State that is one of the 50 States or the District of Columbia and that, as of July 1 of the preceding fiscal year, did not provide for eligibility under clause (i)(VIII) or (ii)(XX) of section 1902(a)(10)(A) for medical assistance under this title (or a waiver of the State plan approved under section 1115) (each such State or District referred to in this section for the fiscal year as a “non-expansion State”) may adjust the payment amounts otherwise provided under the State plan under this title (or a waiver of such plan) to health care providers that provide health care services to individuals enrolled under this title (in this section referred to as “eligible providers”).providers”) so long as the payment adjustment to such an eligible provider does not exceed the provider’s costs in furnishing health care services (as determined by the Secretary and net of payments under this title, other than under this section, and by uninsured patients) to individuals who either are eligible for medical assistance under the State plan (or under a waiver of such plan) or have no health insurance or health plan coverage for such services.

“(b) Increase in applicable FMAP—Notwithstanding section 1905(b), the Federal medical assistance percentage applicable with respect to expenditures attributable to a payment adjustment under subsection (a) for which payment is permitted under subsection (c) shall be equal to—

changed “(1) 100 percent for calendar quarters in calendar fiscal years 2018, 2019, 2020, and 2021; and

changed “(2) 95 percent for calendar quarters in calendar fiscal year 2022.

changed “(c) Limitations; disqualification Annual allotment limitation—Payment under section 1903(a) shall not be made to a State with respect to any payment adjustment made under this section for all calendar quarters in a fiscal year in excess of Statesthe $2,000,000,000 multiplied by the ratio of—

changed “(1) Annual allotment limitation—Payment under section 1903(a) shall not be made to a the population of the State with respect to any payment adjustment made under this section for all calendar quarters income below 138 percent of the poverty line in a year 2015 (as determined based the table entitled “Health Insurance Coverage Status and Type by Ratio of Income to Poverty Level in excess the Past 12 Months by Age” for the universe of the $2,000,000,000 multiplied civilian noninstitutionalized population for whom poverty status is determined based on the 2015 American Community Survey 1–Year Estimates, as published by the ratio of—Bureau of the Census), to

changed “(A) the population of the State with income below 138 percent of the poverty line in 2015 (as determined based the table entitled “Health Insurance Coverage Status and Type by Ratio of Income to Poverty Level in the Past 12 Months by Age” for “(2) the universe sum of the civilian noninstitutionalized population populations under paragraph (1) for whom poverty status is determined based on the 2015 American Community Survey 1-Year Estimates, as published by the Bureau of the Census), toall non-expansion States.

changed “(B) the sum “(d) Disqualification in case of State coverage expansion—If a State is a non-expansion for a fiscal year and provides eligibility for medical assistance described in subsection (a) during the populations fiscal year, the State shall no longer be treated as a non-expansion State under subparagraph (A) this section for all non-expansion States.any subsequent fiscal years.”

removed “(2) Limitation on payment adjustment amount for individual providers—The amount of a payment adjustment under subsection (a) for an eligible provider may not exceed the provider’s costs incurred in furnishing health care services (as determined by the Secretary and net of payments under this title, other than under this section, and by uninsured patients) to individuals who either are eligible for medical assistance under the State plan (or under a waiver of such plan) or have no health insurance or health plan coverage for such services.

removed “(d) Disqualification in case of State coverage expansion—If a State is a non-expansion for a year and provides eligibility for medical assistance described in subsection (a) during the year, the State shall no longer be treated as a non-expansion State under this section for any subsequent years.”

“(K) Frequency of eligibility redeterminations—Beginning on October 1, 2017, and notwithstanding subparagraph (H), in the case of an individual whose eligibility for medical assistance under the State plan under this title (or a waiver of such plan) is determined based on the application of modified adjusted gross income under subparagraph (A) and who is so eligible on the basis of clause (i)(VIII) or clause (ii)(XX) of subsection (a)(10)(A), a State shall redetermine such individual’s eligibility for such medical assistance no less frequently than once every 6 months.”

Title XIX of the Social Security Act is amended—

“1903A. Per capita-based cap on payments for medical assistance

“(a) Application of per capita cap on payments for medical assistance expenditures

“(1) In general—If a State has excess aggregate medical assistance expenditures (as defined in paragraph (2)) for a fiscal year (beginning with fiscal year 2020), the amount of payment to the State under section 1903(a)(1) for each quarter in the following fiscal year shall be reduced by ¼ of the excess aggregate medical assistance payments (as defined in paragraph (3)) for that previous fiscal year. In this section, the term “State” means only the 50 States and the District of Columbia.

“(2) Excess aggregate medical assistance expenditures—In this subsection, the term “excess aggregate medical assistance expenditures” means, for a State for a fiscal year, the amount (if any) by which—

“(A) the amount of the adjusted total medical assistance expenditures (as defined in subsection (b)(1)) for the State and fiscal year; exceeds

“(B) the amount of the target total medical assistance expenditures (as defined in subsection (c)) for the State and fiscal year.

“(3) Excess aggregate medical assistance payments—In this subsection, the term “excess aggregate medical assistance payments” means, for a State for a fiscal year, the product of—

“(A) the excess aggregate medical assistance expenditures (as defined in paragraph (2)) for the State for the fiscal year; and

“(B) the Federal average medical assistance matching percentage (as defined in paragraph (4)) for the State for the fiscal year.

“(4) Federal average medical assistance matching percentage—In this subsection, the term “Federal average medical assistance matching percentage” means, for a State for a fiscal year, the ratio (expressed as a percentage) of—

“(A) the amount of the Federal payments that would be made to the State under section 1903(a)(1) for medical assistance expenditures for calendar quarters in the fiscal year if paragraph (1) did not apply; to

“(B) the amount of the medical assistance expenditures for the State and fiscal year.

“(b) Adjusted total medical assistance expenditures—Subject to subsection (g), the following shall apply:

“(1) In general—In this section, the term adjusted total medical assistance expenditures means, for a State—

“(A) for fiscal year 2016, the product of—

“(i) the amount of the medical assistance expenditures (as defined in paragraph (2)) for the State and fiscal year, reduced by the amount of any excluded expenditures (as defined in paragraph (3)) for the State and fiscal year otherwise included in such medical assistance expenditures; and

“(ii) the 1903A FY16 population percentage (as defined in paragraph (4)) for the State; or

changed “(B) for fiscal year 2019 or a subsequent fiscal year, the amount of the medical assistance expenditures (as defined in paragraph (2)) for the State and fiscal year that is attributable to 1903A enrollees, reduced by the amount of any excluded expenditures (as defined in paragraph (3)) for the State and fiscal year otherwise included in such medical assistance expenditures.expenditures and includes non-DSH supplemental payments (as defined in subsection (d)(4)(A)(ii)) and payments described in subsection (d)(4)(A)(iii) but shall not be construed as including any expenditures attributable to the program under section 1928. In applying subparagraph (B), non-DSH supplemental payments (as defined in subsection (d)(4)(A)(ii)) and payments described in subsection (d)(4)(A)(iii) shall be treated as fully attributable to 1903A enrollees.

changed “(2) Medical assistance expenditures—In this section, the term “medical assistance expenditures” means, for a State and fiscal year, the medical assistance payments as reported by medical service category on the Form CMS-64 quarterly expense report (or successor to such a report form, and including enrollment data and subsequent adjustments to any such report, in this section referred to collectively as a “CMS-64 report”) that directly result from providing medical assistance under the State plan (including under a waiver of the plan) for which payment is (or may otherwise be) made pursuant to section 1903(a)(1).

“(3) Excluded expenditures—In this section, the term “excluded expenditures” means, for a State and fiscal year, expenditures under the State plan (or under a waiver of such plan) that are attributable to any of the following:

“(A) DSH—Payment adjustments made for disproportionate share hospitals under section 1923.

“(B) Medicare cost-sharing—Payments made for medicare cost-sharing (as defined in section 1905(p)(3)).

“(C) Safety net provider payment adjustments in non-expansion States—Payment adjustments under subsection (a) of section 1923A for which payment is permitted under subsection (c) of such section.

“(4) 1903A FY 16 population percentage—In this subsection, the term “1903A FY16 population percentage” means, for a State, the Secretary’s calculation of the percentage of the actual medical assistance expenditures, as reported by the State on the CMS–64 reports for calendar quarters in fiscal year 2016, that are attributable to 1903A enrollees (as defined in subsection (e)(1)).

“(c) Target total medical assistance expenditures

changed “(1) Calculation—In this section, the term target total medical assistance expenditures means, for a State for a fiscal year, year and subject to paragraph (4), the sum of the products, for each of the 1903A enrollee categories (as defined in subsection (e)(2)), of—

“(A) the target per capita medical assistance expenditures (as defined in paragraph (2)) for the enrollee category, State, and fiscal year; and

“(B) the number of 1903A enrollees for such enrollee category, State, and fiscal year, as determined under subsection (e)(4).

changed “(2) Target per capita medical assistance expenditures—In this subsection, the term “target ‘target per capita medical assistance expenditures” expenditures’ means, for a 1903A enrollee category, State, category and a fiscal year, an amount equal to—State—

changed “(A) the provisional FY19 target per capita amount for such enrollee category (as calculated under subsection (d)(5)) for the State; increased byfiscal year 2020, an amount equal to—

changed “(B) the percentage increase in the medical care component of “(i) the consumer price index provisional FY19 target per capita amount for all urban consumers (U.S. city average) from September of 2019 to September of such enrollee category (as calculated under subsection (d)(5)) for the fiscal year involved.State; increased by

added “(ii) the applicable annual inflation factor (as defined in paragraph (3)) for fiscal year 2020; and

added “(B) for each succeeding fiscal year, an amount equal to—

added “(i) the target per capita medical assistance expenditures (under subparagraph (A) or this subparagraph) for the 1903A enrollee category and State for the preceding fiscal year, increased by

added “(ii) the applicable annual inflation factor for that succeeding fiscal year.

added “(3) Applicable annual inflation factor—In paragraph (2), the term applicable annual inflation factor means, for a fiscal year—

added “(A) for each of the 1903A enrollee categories described in subparagraphs (C), (D), and (E) of subsection (e)(2), the percentage increase in the medical care component of the consumer price index for all urban consumers (U.S. city average) from September of the previous fiscal year to September of the fiscal year involved; and

added “(B) for each of the 1903A enrollee categories described in subparagraphs (A) and (B) of subsection (e)(2), the percentage increase described in subparagraph (A) plus 1 percentage point.

added “(4) Decrease in target expenditures for required expenditures by certain political subdivisions

added “(A) In general—In the case of a State that had a DSH allotment under section 1923(f) for fiscal year 2016 that was more than 6 times the national average of such allotments for all the States for such fiscal year and that requires political subdivisions within the State to contribute funds towards medical assistance or other expenditures under the State plan under this title (or under a waiver of such plan) for a fiscal year (beginning with fiscal year 2020), the target total medical assistance expenditures for such State and fiscal year shall be decreased by the amount that political subdivisions in the State are required to contribute under the plan (or waiver) without reimbursement from the State for such fiscal year, other than contributions described in subparagraph (B).

added “(B) Exceptions—The contributions described in this subparagraph are the following:

added “(i) Contributions required by a State from a political subdivision that, as of the first day of the calendar year in which the fiscal year involved begins—

added “(I) has a population of more than 5,000,000, as estimated by the Bureau of the Census; and

added “(II) imposes a local income tax upon its residents.

added “(ii) Contributions required by a State from a political subdivision for administrative expenses if the State required such contributions from such subdivision without reimbursement from the State as of January 1, 2017.

“(d) Calculation of FY19 provisional target amount for each 1903A enrollee category—Subject to subsection (g), the following shall apply:

“(1) Calculation of base amounts for fiscal year 2016—For each State the Secretary shall calculate (and provide notice to the State not later than April 1, 2018, of) the following:

“(A) The amount of the adjusted total medical assistance expenditures (as defined in subsection (b)(1)) for the State for fiscal year 2016.

“(B) The number of 1903A enrollees for the State in fiscal year 2016 (as determined under subsection (e)(4)).

“(C) The average per capita medical assistance expenditures for the State for fiscal year 2016 equal to—

“(i) the amount calculated under subparagraph (A); divided by

“(ii) the number calculated under subparagraph (B).

“(2) Fiscal year 2019 average per capita amount based on inflating the fiscal year 2016 amount to fiscal year 2019 by CPI-medical—The Secretary shall calculate a fiscal year 2019 average per capita amount for each State equal to—

“(A) the average per capita medical assistance expenditures for the State for fiscal year 2016 (calculated under paragraph (1)(C)); increased by

“(B) the percentage increase in the medical care component of the consumer price index for all urban consumers (U.S. city average) from September, 2016 to September, 2019.

“(3) Aggregate and average expenditures per capita for fiscal year 2019—The Secretary shall calculate for each State the following:

“(A) The amount of the adjusted total medical assistance expenditures (as defined in subsection (b)(1)) for the State for fiscal year 2019.

“(B) The number of 1903A enrollees for the State in fiscal year 2019 (as determined under subsection (e)(4)).

“(4) Per capita expenditures for fiscal year 2019 for each 1903A enrollee category—The Secretary shall calculate (and provide notice to each State not later than January 1, 2020, of) the following:

“(A)

“(i) For each 1903A enrollee category, the amount of the adjusted total medical assistance expenditures (as defined in subsection (b)(1)) for the State for fiscal year 2019 for individuals in the enrollee category, calculated by excluding from medical assistance expenditures those expenditures attributable to expenditures described in clause (iii) or non-DSH supplemental expenditures (as defined in clause (ii)).

“(ii) In this paragraph, the term “non-DSH supplemental expenditure” means a payment to a provider under the State plan (or under a waiver of the plan) that—

“(I) is not made under section 1923;

“(II) is not made with respect to a specific item or service for an individual;

“(III) is in addition to any payments made to the provider under the plan (or waiver) for any such item or service; and

“(IV) complies with the limits for additional payments to providers under the plan (or waiver) imposed pursuant to section 1902(a)(30)(A), including the regulations specifying upper payment limits under the State plan in part 447 of title 42, Code of Federal Regulations (or any successor regulations).

“(iii) An expenditure described in this clause is an expenditure that meets the criteria specified in subclauses (I), (II), and (III) of clause (ii) and is authorized under section 1115 for the purposes of funding a delivery system reform pool, uncompensated care pool, a designated state health program, or any other similar expenditure (as defined by the Secretary).

“(B) For each 1903A enrollee category, the number of 1903A enrollees for the State in fiscal year 2019 in the enrollee category (as determined under subsection (e)(4)).

added “(C) For fiscal year 2016, the State’s non-DSH supplemental and pool payment percentage is equal to the ratio (expressed as a percentage) of—

added “(i) the total amount of non-DSH supplemental expenditures (as defined in subparagraph (A)(ii)) and payments described in subparagraph (A)(iii) for the State for fiscal year 2016; to

removed “(C) For fiscal year 2016, the State’s non-DSH supplemental payment percentage is equal to the ratio (expressed as a percentage) of—

removed “(i) the total amount of non-DSH supplemental expenditures (as defined in subparagraph (A)(ii)) for the State for fiscal year 2016; to

“(ii) the amount described in subsection (b)(1)(A) for the State for fiscal year 2016.

“(D) For each 1903A enrollee category an average medical assistance expenditures per capita for the State for fiscal year 2019 for the enrollee category equal to—

added “(i) the amount calculated under subparagraph (A) for the State, increased by the non-DSH supplemental and pool payment percentage for the State (as calculated under subparagraph (C)); divided by

removed “(i) the amount calculated under subparagraph (A) for the State, increased by the non-DSH supplemental payment percentage for the State (as calculated under subparagraph (C)); divided by

“(ii) the number calculated under subparagraph (B) for the State for the enrollee category.

“(5) Provisional FY19 per capita target amount for each 1903A enrollee category—Subject to subsection (f)(2), the Secretary shall calculate for each State a provisional FY19 per capita target amount for each 1903A enrollee category equal to the average medical assistance expenditures per capita for the State for fiscal year 2019 (as calculated under paragraph (4)(D)) for such enrollee category multiplied by the ratio of—

“(A) the product of—

“(i) the fiscal year 2019 average per capita amount for the State, as calculated under paragraph (2); and

“(ii) the number of 1903A enrollees for the State in fiscal year 2019, as calculated under paragraph (3)(B); to

“(B) the amount of the adjusted total medical assistance expenditures for the State for fiscal year 2019, as calculated under paragraph (3)(A).

“(e) 1903A enrollee; 1903A enrollee category—Subject to subsection (g), for purposes of this section, the following shall apply:

added “(1) 1903A enrollee—The term 1903A enrollee means, with respect to a State and a month and subject to subsection (i)(1)(B), any Medicaid enrollee (as defined in paragraph (3)) for the month, other than such an enrollee who for such month is in any of the following categories of excluded individuals:

removed “(1) 1903A enrollee—The term 1903A enrollee means, with respect to a State and a month, any Medicaid enrollee (as defined in paragraph (3)) for the month, other than such an enrollee who for such month is in any of the following categories of excluded individuals:

“(A) CHIP—An individual who is provided, under this title in the manner described in section 2101(a)(2), child health assistance under title XXI.

“(B) IHS—An individual who receives any medical assistance under this title for services for which payment is made under the third sentence of section 1905(b).

“(C) Breast and cervical cancer services eligible individual—An individual who is entitled to medical assistance under this title only pursuant to section 1902(a)(10)(A)(ii)(XVIII).

“(D) Partial-benefit enrollees—An individual who—

“(i) is an alien who is entitled to medical assistance under this title only pursuant to section 1903(v)(2);

“(ii) is entitled to medical assistance under this title only pursuant to subclause (XII) or (XXI) of section 1902(a)(10)(A)(ii) (or pursuant to a waiver that provides only comparable benefits);

“(iii) is a dual eligible individual (as defined in section 1915(h)(2)(B)) and is entitled to medical assistance under this title (or under a waiver) only for some or all of medicare cost-sharing (as defined in section 1905(p)(3)); or

“(iv) is entitled to medical assistance under this title and for whom the State is providing a payment or subsidy to an employer for coverage of the individual under a group health plan pursuant to section 1906 or section 1906A (or pursuant to a waiver that provides only comparable benefits).

“(2) 1903A enrollee category—The term 1903A enrollee category means each of the following:

“(A) Elderly—A category of 1903A enrollees who are 65 years of age or older.

“(B) Blind and disabled—A category of 1903A enrollees (not described in the previous subparagraph) who are eligible for medical assistance under this title on the basis of being blind or disabled.

“(C) Children—A category of 1903A enrollees (not described in a previous subparagraph) who are children under 19 years of age.

“(D) Expansion enrollees—A category of 1903A enrollees (not described in a previous subparagraph) for whom the amounts expended for medical assistance are subject to an increase or change in the Federal medical assistance percentage under subsection (y) or (z)(2), respectively, of section 1905.

“(E) Other nonelderly, nondisabled, non-expansion adults—A category of 1903A enrollees who are not described in any previous subparagraph.

“(3) Medicaid enrollee—The term Medicaid enrollee means, with respect to a State for a month, an individual who is eligible for medical assistance for items or services under this title and enrolled under the State plan (or a waiver of such plan) under this title for the month.

“(4) Determination of number of 1903A enrollees—The number of 1903A enrollees for a State and fiscal year, and, if applicable, for a 1903A enrollee category, is the average monthly number of Medicaid enrollees for such State and fiscal year (and, if applicable, in such category) that are reported through the CMS–64 report under (and subject to audit under) subsection (h).

“(f) Special payment rules

“(1) Application in case of research and demonstration projects and other waivers—In the case of a State with a waiver of the State plan approved under section 1115, section 1915, or another provision of this title, this section shall apply to medical assistance expenditures and medical assistance payments under the waiver, in the same manner as if such expenditures and payments had been made under a State plan under this title and the limitations on expenditures under this section shall supersede any other payment limitations or provisions (including limitations based on a per capita limitation) otherwise applicable under such a waiver.

“(2) Treatment of States expanding coverage after fiscal year 2016—In the case of a State that did not provide for medical assistance for the 1903A enrollee category described in subsection (e)(2)(D) during fiscal year 2016 but which provides for such assistance for such category in a subsequent year, the provisional FY19 per capita target amount for such enrollee category under subsection (d)(5) shall be equal to the provisional FY19 per capita target amount for the 1903A enrollee category described in subsection (e)(2)(E).

“(3) In case of State failure to report necessary data—If a State for any quarter in a fiscal year (beginning with fiscal year 2019) fails to satisfactorily submit data on expenditures and enrollees in accordance with subsection (h)(1), for such fiscal year and any succeeding fiscal year for which such data are not satisfactorily submitted—

“(A) the Secretary shall calculate and apply subsections (a) through (e) with respect to the State as if all 1903A enrollee categories for which such expenditure and enrollee data were not satisfactorily submitted were a single 1903A enrollee category; and

“(B) the growth factor otherwise applied under subsection (c)(2)(B) shall be decreased by 1 percentage point.

“(g) Recalculation of certain amounts for data errors—The amounts and percentage calculated under paragraphs (1) and (4)(C) of subsection (d) for a State for fiscal year 2016, and the amounts of the adjusted total medical assistance expenditures calculated under subsection (b) and the number of Medicaid enrollees and 1903A enrollees determined under subsection (e)(4) for a State for fiscal year 2016, fiscal year 2019, and any subsequent fiscal year, may be adjusted by the Secretary based upon an appeal (filed by the State in such a form, manner, and time, and containing such information relating to data errors that support such appeal, as the Secretary specifies) that the Secretary determines to be valid, except that any adjustment by the Secretary under this subsection for a State may not result in an increase of the target total medical assistance expenditures exceeding 2 percent.

“(h) Required reporting and auditing of CMS–64 data; transitional increase in Federal matching percentage for certain administrative expenses

“(1) Reporting—In addition to the data required on form Group VIII on the CMS–64 report form as of January 1, 2017, in each CMS-64 report required to be submitted (for each quarter beginning on or after October 1, 2018), the State shall include data on medical assistance expenditures within such categories of services and categories of enrollees (including each 1903A enrollee category and each category of excluded individuals under subsection (e)(1)) and the numbers of enrollees within each of such enrollee categories, as the Secretary determines are necessary (including timely guidance published as soon as possible after the date of the enactment of this section) in order to implement this section and to enable States to comply with the requirement of this paragraph on a timely basis.

“(2) Auditing—The Secretary shall conduct for each State an audit of the number of individuals and expenditures reported through the CMS–64 report for fiscal year 2016, fiscal year 2019, and each subsequent fiscal year, which audit may be conducted on a representative sample (as determined by the Secretary).

“(3) Temporary increase in federal matching percentage to support improved data reporting systems for fiscal years 2018 and 2019—For amounts expended during calendar quarters beginning on or after October 1, 2017, and before October 1, 2019—

“(A) the Federal matching percentage applied under section 1903(a)(3)(A)(i) shall be increased by 10 percentage points to 100 percent;

“(B) the Federal matching percentage applied under section 1903(a)(3)(B) shall be increased by 25 percentage points to 100 percent; and

added “(C) the Federal matching percentage applied under section 1903(a)(7) shall be increased by 10 percentage points to 60 percent but only with respect to amounts expended that are attributable to a State’s additional administrative expenditures to implement the data requirements of paragraph (1).

added “(i) Flexible block grant option for States

added “(1) In general—In the case of a State that elects the option of applying this subsection for a 10-fiscal-year period (beginning no earlier than fiscal year 2020 and, at the State option, for any succeeding 10-fiscal-year period) and that has a plan approved by the Secretary under paragraph (2) to carry out the option for such period—

added “(A) the State shall receive, instead of amounts otherwise payable to the State under this title for medical assistance for block grant individuals within the applicable block grant category (as defined in paragraph (6)) for the State during the period in which the election is in effect, the amount specified in paragraph (4);

added “(B) the previous provisions of this section shall be applied as if—

added “(i) block grant individuals within the applicable block grant category for the State and period were not section 1903A enrollees for each 10-fiscal year period for which the State elects to apply this subsection; and

added “(ii) if such option is not extended at the end of a 10-fiscal-year-period, the per capita limitations under such previous provisions shall again apply after such period and such limitations shall be applied as if the election under this subsection had never taken place;

added “(C) the payment under this subsection may only be used consistent with the State plan under paragraph (2) for block grant health care assistance (as defined in paragraph (7)); and

added “(D) with respect to block grant individuals within the applicable block grant category for the State for which block grant health care assistance is made available under this subsection, such assistance shall be instead of medical assistance otherwise provided to the individual under this title.

added “(2) State plan for administering block grant option

added “(A) In general—No payment shall be made under this subsection to a State pursuant to an election for a 10-fiscal-year period under paragraph (1) unless the State has a plan, approved under subparagraph (B), for such period that specifies—

added “(i) the applicable block grant category with respect to which the State will apply the option under this subsection for such period;

added “(ii) the conditions for eligibility of block grant individuals within such applicable block grant category for block grant health care assistance under the option, which shall be instead of other conditions for eligibility under this title, except that in the case of a State that has elected the applicable block grant category described in—

added “(I) subparagraph (A) of paragraph (6), the plan must provide for eligibility for pregnant women and children required to be provided medical assistance under subsections (a)(10)(A)(i) and (e)(4) of section 1902; or

added “(II) subparagraph (B) of paragraph (6), the plan must provide for eligibility for pregnant women required to be provided medical assistance under subsection (a)(10)(A)(i); and

added “(iii) the types of items and services, the amount, duration, and scope of such services, the cost-sharing with respect to such services, and the method for delivery of block grant health care assistance under this subsection, which shall be instead of the such types, amount, duration, and scope, cost-sharing, and methods of delivery for medical assistance otherwise required under this title, except that the plan must provide for assistance for—

added “(I) hospital care;

added “(II) surgical care and treatment;

added “(III) medical care and treatment;

added “(IV) obstetrical and prenatal care and treatment;

added “(V) prescribed drugs, medicines, and prosthetic devices;

added “(VI) other medical supplies and services; and

added “(VII) health care for children under 18 years of age.

added “(B) Review and approval—A plan described in subparagraph (A) shall be deemed approved by the Secretary unless the Secretary determines, within 30 days after the date of the Secretary’s receipt of the plan, that the plan is incomplete or actuarially unsound and, with respect to such plan and its implementation under this subsection, the requirements of paragraphs (1), (10)(B), (17), and (23) of section 1902(a) shall not apply.

added “(3) Amount of block grant funds

added “(A) For initial fiscal year—The block grant amount under this paragraph for a State for the initial fiscal year in the first 10-fiscal-year period is equal to the sum of the products (for each applicable block grant category for such State and period) of—

added “(i) the target per capita medical assistance expenditures for such State for such fiscal year (under subsection (c)(2));

added “(ii) the number of 1903A enrollees for such category and State for fiscal year 2019, as determined under subsection (e)(4); and

added “(iii) the Federal average medical assistance matching percentage (as defined in subsection (a)(4)) for the State for fiscal year 2019.

added “(B) For any subsequent fiscal year—The block grant amount under this paragraph for a State for each succeeding fiscal year (in any 10-fiscal-year period) is equal to the block grant amount under subparagraph (A) (or this subparagraph) for the State for the previous fiscal year increased by the annual increase in the consumer price index for all urban consumers (all items; U.S. city average) for the fiscal year involved.

added “(C) Availability of rollover funds—The block grant amount under this paragraph for a State for a fiscal year shall remain available to the State for expenditures under this subsection for the succeeding fiscal year but only if an election is in effect under this subsection for the State in such succeeding fiscal year.

added “(4) Federal payment and State responsibility—The Secretary shall pay to each State with an election in effect under this subsection for a fiscal year, from its block grant amount under paragraph (3) available for such fiscal year, an amount for each quarter of such fiscal year equal to the enhanced FMAP described in the first sentence of section 2105(b) of the total amount expended under the State plan under this subsection during such quarter, and the State is responsible for the balance of funds to carry out such plan.

added “(5) Block grant individual defined—In this subsection, the term block grant individual means, with respect to a State for a 10-fiscal-year period, an individual who is not disabled (as defined for purposes of the State plan) and who is within an applicable block grant category for the State and such period.

added “(6) Applicable block grant category defined—In this subsection, the term applicable block grant category means with respect to a State for a 10-fiscal-year period, either of the following as specified by the State for such period in its plan under paragraph (2)(A)(i):

added “(A) 2 enrollee categories—Both of the following 1903A enrollee categories:

added “(i) Children—The 1903A enrollee category specified in subparagraph (C) of subsection (e)(2).

added “(ii) Other nonelderly, nondisabled, non-expansion adults—The 1903A enrollee category specified in subparagraph (E) of such subsection.

added “(B) Other nonelderly, nondisabled, non-expansion adults—Only the 1903A enrollee category specified in subparagraph (E) of subsection (e)(2).

added “(7) Block grant health care assistance—In this subsection, the term block grant health care assistance means assistance for health-care-related items and medical services for block grant individuals within the applicable block grant category for the State and 10-fiscal-year period involved who are low-income individuals (as defined by the State).

added “(8) Auditing—As a condition of receiving funds under this subsection, a State shall contract with an independent entity to conduct audits of its expenditures made with respect to activities funded under this subsection for each fiscal year for which the State elects to apply this subsection to ensure that such funds are used consistent with this subsection and shall make such audits available to the Secretary upon the request of the Secretary.”

removed “(C) the Federal matching percentage applied under section 1903(a)(7) shall be increased by 10 percentage points to 60 percent but only with respect to amounts expended that are attributable to a State’s additional administrative expenditures to implement the data requirements of paragraph (1).”

The Social Security Act (42 U.S.C. 301 et seq.) is amended by adding at the end the following new title:

“XXII Patient and State Stability Fund

“2201. Establishment of program

“There is hereby established the “Patient and State Stability Fund” to be administered by the Secretary of Health and Human Services, acting through the Administrator of the Centers for Medicare & Medicaid Services (in this section referred to as the “Administrator”), to provide funding, in accordance with this title, to the 50 States and the District of Columbia (each referred to in this section as a “State”) during the period, subject to section 2204(c), beginning on January 1, 2018, and ending on December 31, 2026, for the purposes described in section 2202.

“2202. Use of funds

changed “A “(a) In General—Subject to subsections (b) and (c), a State may use the funds allocated to the State under this title for any of the following purposes:

“(1) Helping, through the provision of financial assistance, high-risk individuals who do not have access to health insurance coverage offered through an employer enroll in health insurance coverage in the individual market in the State, as such market is defined by the State (whether through the establishment of a new mechanism or maintenance of an existing mechanism for such purpose).

“(2) Providing incentives to appropriate entities to enter into arrangements with the State to help stabilize premiums for health insurance coverage in the individual market, as such markets are defined by the State.

changed “(3) Reducing the cost for providing health insurance coverage in the individual market and small group market, as such markets are defined by the State, to individuals who have, or are projected to have, a high rate of utilization of health services (as measured by cost).cost) and to individuals who have high costs of health insurance coverage due to the low density population of the State in which they reside.

“(4) Promoting participation in the individual market and small group market in the State and increasing health insurance options available through such market.

changed “(5) Promoting access to preventive services; dental care services (whether preventive or medically necessary); vision care services (whether preventive or medically necessary); prevention, treatment, or recovery support services for individuals with mental or substance use disorders; or any combination of such services.

changed “(6) Providing payments, directly or indirectly, to health care providers for the provision of such health care services as are specified by the Administrator.Maternity coverage and newborn care.

changed “(7) Providing assistance to reduce out-of-pocket costs, such as copayments, coinsurance, premiums, and deductibles, of Prevention, treatment, or recovery support services for individuals enrolled in health insurance coverage in with mental or substance use disorders, focused on either or both of the State.following:

added “(A) Direct inpatient or outpatient clinical care for treatment of addiction and mental illness.

added “(B) Early identification and intervention for children and young adults with serious mental illness.

added “(8) Providing payments, directly or indirectly, to health care providers for the provision of such health care services as are specified by the Administrator.

added “(9) Providing assistance to reduce out-of-pocket costs, such as copayments, coinsurance, premiums, and deductibles, of individuals enrolled in health insurance coverage in the State.

added “(b) Required use of increase in allotment—A State shall use the additional allocation provided to the State from the funds appropriated under the second sentence of section 2204(a) for each year only for the purposes described in paragraphs (6) and (7) of subsection (a).

added “(c) Required use of additional increase to certain waiver States to provide financial hardship assistance—A State shall use the additional allocation provided to the State from the funds appropriated under the last sentence of section 2204(a) only in accordance with such last sentence.

“2203. State eligibility and approval; Default safeguard

“(a) Encouraging State options for allocations

“(1) In general—To be eligible for an allocation of funds under this title for a year during the period described in section 2201 for use for one or more purposes described in section 2202, a State shall submit to the Administrator an application at such time (but, in the case of allocations for 2018, not later than 45 days after the date of the enactment of this title and, in the case of allocations for a subsequent year, not later than March 31 of the previous year) and in such form and manner as specified by the Administrator and containing—

“(A) a description of how the funds will be used for such purposes;

“(B) a certification that the State will make, from non-Federal funds, expenditures for such purposes in an amount that is not less than the State percentage required for the year under section 2204(e)(1); and

“(C) such other information as the Administrator may require.

“(2) Automatic approval—An application so submitted is approved unless the Administrator notifies the State submitting the application, not later than 60 days after the date of the submission of such application, that the application has been denied for not being in compliance with any requirement of this title and of the reason for such denial.

“(3) One-time application—If an application of a State is approved for a year, with respect to a purpose described in section 2202, such application shall be treated as approved, with respect to such purpose, for each subsequent year through 2026.

“(4) Treatment as a State Health Care Program—Any program receiving funds from an allocation for a State under this title, including pursuant to subsection (b), shall be considered to be a “State health care program” for purposes of sections 1128, 1128A, and 1128B.

“(b) Default Federal safeguard

“(1) In general

“(A) 2018—For allocations made under this title for 2018, in the case of a State that does not submit an application under subsection (a) by the 45-day submission date applicable to such year under subsection (a)(1) and in the case of a State that does submit such an application by such date that is not approved, subject to section 2204(e), the Administrator, in consultation with the State insurance commissioner, shall use the allocation that would otherwise be provided to the State under this title for such year, in accordance with paragraph (2), for such State.

“(B) 2019 through 2026—In the case of a State that does not have in effect an approved application under this section for 2019 or a subsequent year beginning during the period described in section 2201, subject to section 2204(e), the Administrator, in consultation with the State insurance commissioner, shall use the allocation that would otherwise be provided to the State under this title for such year, in accordance with paragraph (2), for such State.

“(2) Required use for market stabilization payments to issuers—Subject to section 2204(a), an allocation for a State made pursuant to paragraph (1) for a year shall be used to carry out the purpose described in section 2202(2) in such State by providing payments to appropriate entities described in such section with respect to claims that exceed $50,000 (or, with respect to allocations made under this title for 2020 or a subsequent year during the period specified in section 2201, such dollar amount specified by the Administrator), but do not exceed $350,000 (or, with respect to allocations made under this title for 2020 or a subsequent year during such period, such dollar amount specified by the Administrator), in an amount equal to 75 percent (or, with respect to allocations made under this title for 2020 or a subsequent year during such period, such percentage specified by the Administrator) of the amount of such claims.

“2204. Allocations

“(a) Appropriation—For the purpose of providing allocations for States (including pursuant to section 2203(b)) under this title there is appropriated, out of any money in the Treasury not otherwise appropriated—

“(1) for 2018, $15,000,000,000;

“(2) for 2019, $15,000,000,000;

“(3) for 2020, $10,000,000,000;

“(4) for 2021, $10,000,000,000;

“(5) for 2022, $10,000,000,000;

“(6) for 2023, $10,000,000,000;

“(7) for 2024, $10,000,000,000;

“(8) for 2025, $10,000,000,000; and

“(9) for 2026, $10,000,000,000.

“(b) Allocations

“(1) Payment

“(A) In general—From amounts appropriated under subsection (a) for a year, the Administrator shall, with respect to a State and not later than the date specified under subparagraph (B) for such year, allocate, subject to subsection (e), for such State (including pursuant to section 2203(b)) the amount determined for such State and year under paragraph (2).

“(B) Specified date—For purposes of subparagraph (A), the date specified in this subparagraph is—

“(i) for 2018, the date that is 45 days after the date of the enactment of this title; and

“(ii) for 2019 and subsequent years, January 1 of the respective year.

“(2) Allocation amount determinations

“(A) For 2018 and 2019

“(i) In general—For purposes of paragraph (1), the amount determined under this paragraph for 2018 and 2019 for a State is an amount equal to the sum of—

“(I) the relative incurred claims amount described in clause (ii) for such State and year; and

“(II) the relative uninsured and issuer participation amount described in clause (iv) for such State and year.

“(ii) Relative incurred claims amount—For purposes of clause (i), the relative incurred claims amount described in this clause for a State for 2018 and 2019 is the product of—

“(I) 85 percent of the amount appropriated under subsection (a) for the year; and

“(II) the relative State incurred claims proportion described in clause (iii) for such State and year.

“(iii) Relative State incurred claims proportion—The relative State incurred claims proportion described in this clause for a State and year is the amount equal to the ratio of—

“(I) the adjusted incurred claims by the State, as reported through the medical loss ratio annual reporting under section 2718 of the Public Health Service Act for the third previous year; to

“(II) the sum of such adjusted incurred claims for all States, as so reported, for such third previous year.

“(iv) Relative uninsured and issuer participation amount—For purposes of clause (i), the relative uninsured and issuer participation amount described in this clause for a State for 2018 and 2019 is the product of—

“(I) 15 percent of the amount appropriated under subsection (a) for the year; and

“(II) the relative State uninsured and issuer participation proportion described in clause (v) for such State and year.

“(v) Relative State uninsured and issuer participation proportion—The relative State uninsured and issuer participation proportion described in this clause for a State and year is—

“(I) in the case of a State not described in clause (vi) for such year, 0; and

“(II) in the case of a State described in clause (vi) for such year, the amount equal to the ratio of—

“(aa) the number of individuals residing in such State who for the third preceding year were not enrolled in a health plan or otherwise did not have health insurance coverage (including through a Federal or State health program) and whose income is below 100 percent of the poverty line applicable to a family of the size involved; to

“(bb) the sum of the number of such individuals for all States described in clause (vi) for the third preceding year.

“(vi) States described—For purposes of clause (v), a State is described in this clause, with respect to 2018 and 2019, if the State satisfies either of the following criterion:

added “(I) The ratio described in subclause (II) of clause (v) that would be determined for such State by substituting “2015” for each reference in such subclause to “the third preceding year” and by substituting “all such States” for the reference in item (bb) of such subclause to “all States described in clause (vi)” is greater than the ratio described in such subclause that would be determined for such State by substituting “2013” for each reference in such subclause to “the third preceding year” and by substituting “all such States” for the reference in item (bb) of such subclause to “all States described in clause (vi)”.

added “(II) The State has fewer than three health insurance issuers offering qualified health plans through the Exchange for 2017.

removed “(I) The number of individuals residing in such State and described in clause (v)(II)(aa) was higher in 2015 than 2013.

removed “(II) The State have fewer than three health insurance issuers offering qualified health plans through the Exchange for 2017.

“(B) For 2020 through 2026—For purposes of paragraph (1), the amount determined under this paragraph for a year (beginning with 2020) during the period described in section 2201 for a State is an amount determined in accordance with an allocation methodology specified by the Administrator which—

“(i) takes into consideration the adjusted incurred claims of such State, the number of residents of such State who for the previous year were not enrolled in a health plan or otherwise did not have health insurance coverage (including through a Federal or State health program) and whose income is below 100 percent of the poverty line applicable to a family of the size involved, and the number of health insurance issuers participating in the insurance market in such State for such year;

“(ii) is established after consultation with health care consumers, health insurance issuers, State insurance commissioners, and other stakeholders and after taking into consideration additional cost and risk factors that may inhibit health care consumer and health insurance issuer participation; and

“(iii) reflects the goals of improving the health insurance risk pool, promoting a more competitive health insurance market, and increasing choice for health care consumers.

“(c) Annual distribution of previous year’s remaining funds—In carrying out subsection (b), the Administrator shall, with respect to a year (beginning with 2020 and ending with 2027), not later than March 31 of such year—

“(1) determine the amount of funds, if any, from the amounts appropriated under subsection (a) for the previous year but not allocated for such previous year; and

“(2) if the Administrator determines that any funds were not so allocated for such previous year, allocate such remaining funds, in accordance with the allocation methodology specified pursuant to subsection (b)(2)(B)—

“(A) to States that have submitted an application approved under section 2203(a) for such previous year for any purpose for which such an application was approved; and

added “(B) for States for which allocations were made pursuant to section 2203(b) for such previous year, to be used by the Administrator for such States, to carry out the Federal Invisible Risk Sharing Program in such States under section 2205;

removed “(B) for States for which allocations were made pursuant to section 2203(b) for such previous year, to be used by the Administrator for such States, to carry out the purpose described in section 2202(2) in such States by providing payments to appropriate entities described in such section with respect to claims that exceed $1,000,000;

“(d) Availability—Amounts appropriated under subsection (a) for a year and allocated to States in accordance with this section shall remain available for expenditure through December 31, 2027.

“(e) Conditions for and limitations on receipt of funds—The Secretary may not make an allocation under this title for a State, with respect to a purpose described in section 2202—

“(1) in the case of an allocation that would be made to a State pursuant to section 2203(a), if the State does not agree that the State will make available non-Federal contributions towards such purpose in an amount equal to—

“(A) for 2020, 7 percent of the amount allocated under this subsection to such State for such year and purpose;

“(B) for 2021, 14 percent of the amount allocated under this subsection to such State for such year and purpose;

“(C) for 2022, 21 percent of the amount allocated under this subsection to such State for such year and purpose;

“(D) for 2023, 28 percent of the amount allocated under this subsection to such State for such year and purpose;

“(E) for 2024, 35 percent of the amount allocated under this subsection to such State for such year and purpose;

“(F) for 2025, 42 percent of the amount allocated under this subsection to such State for such year and purpose; and

“(G) for 2026, 50 percent of the amount allocated under this subsection to such State for such year and purpose;

“(2) in the case of an allocation that would be made for a State pursuant to section 2203(b), if the State does not agree that the State will make available non-Federal contributions towards such purpose in an amount equal to—

“(A) for 2020, 10 percent of the amount allocated under this subsection to such State for such year and purpose;

“(B) for 2021, 20 percent of the amount allocated under this subsection to such State for such year and purpose; and

“(C) for 2022, 30 percent of the amount allocated under this subsection to such State for such year and purpose;

“(D) for 2023, 40 percent of the amount allocated under this subsection to such State for such year and purpose;

“(E) for 2024, 50 percent of the amount allocated under this subsection to such State for such year and purpose;

“(F) for 2025, 50 percent of the amount allocated under this subsection to such State for such year and purpose; and

“(G) for 2026, 50 percent of the amount allocated under this subsection to such State for such year and purpose; or

added “(3) if such an allocation for such purpose would not be permitted under subsection (c)(7) of section 2105 if such allocation were payment made under such section.

added “2205. Federal Invisible Risk Sharing Program

added “(a) In general—There is established within the Patient and State Stability Fund a Federal Invisible Risk Sharing Program (in this section referred to as the “Program”), to be administered by the Secretary of Health and Human Services, acting through the Administrator of the Centers for Medicare & Medicaid Services (in this section referred to as the “Administrator”), to provide payments to health insurance issuers with respect to claims for eligible individuals for the purpose of lowering premiums for health insurance coverage offered in the individual market.

added “(b) Funding

added “(1) Appropriation—For the purpose of providing funding for the Program there is appropriated, out of any money in the Treasury not otherwise appropriated, $15,000,000,000 for the period beginning on January 1, 2018, and ending on December 31, 2026.

added “(2) Use of unallocated funds—Funds provided under section 2204(c)(2)(B) to carry out this section are in addition to the amount appropriated under paragraph (1).

added “(c) Operation of program

added “(1) In general—The Administrator shall establish, after consultation with health care consumers, health insurance issuers, State insurance commissioners, and other stakeholders and after taking into consideration high cost health conditions and other health trends that generate high cost, parameters for the operation of the Program consistent with this section and consistent with the same limitation on payment with respect to health insurance coverage that applies to payment with respect health benefits coverage under section 2105(c)(7).

added “(2) Deadline for initial operation—Not later than 60 days after the date of the enactment of this title, the Administrator shall establish sufficient parameters to specify how the Program will operate for plan year 2018.

added “(3) State operation of program—The Administrator shall establish a process for a State to operate the Program in such State beginning with plan year 2020.

added “(d) Details of program—The parameters for the Program shall include the following:

added “(1) Eligible individuals—A definition for eligible individuals.

added “(2) Health status statements—The development and use of health status statements with respect to such individuals.

added “(3) Standards for qualification

added “(A) Automatic qualification—The identification of health conditions that automatically qualify individuals as eligible individuals at the time of application for health insurance coverage.

added “(B) Voluntary qualification—A process under which health insurance issuers may voluntarily qualify individuals, who do not automatically qualify under subparagraph (A), as eligible individuals at the time of application for such coverage.

added “(4) Percentage of insurance premiums to be applied—The percentage of the premiums paid, to health insurance issuers for health insurance coverage by eligible individuals, that shall be collected and deposited to the credit (and available for the use) of the Program.

added “(5) Attachment dollar amount and payment proportion—The dollar amount of claims for eligible individuals after which the Program will provide payments to health insurance issuers and the proportion of such claims above such dollar amount that the Program will pay.”

removed “(3) if such an allocation for such purpose would not be permitted under subsection (c)(7) of section 2105 if such allocation were payment made under such section.”

Subpart I of part A of title XXVII of the Public Health Service Act is amended—

“2710A. Encouraging continuous health insurance coverage

“(a) Penalty applied

changed “(1) In general—Notwithstanding section 2701, subject general—Subject to the succeeding provisions of this section, a health insurance issuer offering health insurance coverage in the individual or small group market shall, in the case of an individual who is an applicable policyholder of such coverage with respect to an enforcement period applicable to enrollments for a plan year beginning with plan year 2019 (or, in the case of enrollments during a special enrollment period, beginning with plan year 2018), increase the monthly premium rate otherwise applicable to such individual for such coverage during each month of such period, by an amount determined under paragraph (2).

“(2) Amount of penalty—The amount determined under this paragraph for an applicable policyholder enrolling in health insurance coverage described in paragraph (1) for a plan year, with respect to each month during the enforcement period applicable to enrollments for such plan year, is the amount that is equal to 30 percent of the monthly premium rate otherwise applicable to such applicable policyholder for such coverage during such month.

“(b) Definitions—For purposes of this section:

“(1) Applicable policyholder—The term “applicable policyholder” means, with respect to months of an enforcement period and health insurance coverage, an individual who—

“(A) is a policyholder of such coverage for such months;

changed “(B) cannot demonstrate that (through presentation of certifications described in section 2704(e) or in such other manner as may be specified in regulations, such as a return or statement made under section 6055(d) or 36C 36B of the Internal Revenue Code of 1986), during the look-back period that is with respect to such enforcement period, there was not a period of at least 63 continuous days during which the individual did not have creditable coverage (as defined in paragraph (1) of section 2704(c) and credited in accordance with paragraphs (2) and (3) of such section); and

“(C) in the case of an individual who had been enrolled under dependent coverage under a group health plan or health insurance coverage by reason of section 2714 and such dependent coverage of such individual ceased because of the age of such individual, is not enrolling during the first open enrollment period following the date on which such coverage so ceased.

“(2) Look-back period—The term “look-back period” means, with respect to an enforcement period applicable to an enrollment of an individual for a plan year beginning with plan year 2019 (or, in the case of an enrollment of an individual during a special enrollment period, beginning with plan year 2018) in health insurance coverage described in subsection (a)(1), the 12-month period ending on the date the individual enrolls in such coverage for such plan year.

“(3) Enforcement period—The term “enforcement period” means—

“(A) with respect to enrollments during a special enrollment period for plan year 2018, the period beginning with the first month that is during such plan year and that begins subsequent to such date of enrollment, and ending with the last month of such plan year; and

“(B) with respect to enrollments for plan year 2019 or a subsequent plan year, the 12-month period beginning on the first day of the respective plan year.”

changed Section 2701(a)(1)(A)(iii) of the Public Health Service Act (42 U.S.C. 300gg(a)(1)(A)(iii)), as inserted by section 1201(4) of the Patient Protection and Affordable Care Act, is amended by inserting after “(consistent with section 2707(c))” the following: “or, for plan years beginning on or after January 1, 2018, as the Secretary may implement through interim final regulation, 5 to 1 for adults (consistent with section 2707(c)) or such other ratio for adults (consistent with section 2707(c)) as the State involved may provide”.provide (or, in the case of a State with a waiver under subsection (b) in effect for such a plan year, the ratio applied for such plan year in accordance with such waiver)”.

“(i) is a grandfathered health plan or a grandmothered health plan, or

“(ii) includes coverage for abortions (other than any abortion necessary to save the life of the mother or any abortion with respect to a pregnancy that is the result of an act of rape or incest).”

“(C) Grandmothered health plan

“(i) In general—The term “grandmothered health plan” means health insurance coverage which is offered in the individual health insurance market as of October 1, 2013, and is permitted to be offered in such market after January 1, 2014, as a result of CCIIO guidance.

“(ii) CCIIO guidance defined—The term CCIIO guidance means the letter issued by the Centers for Medicare & Medicaid Services on November 14, 2013, to the State Insurance Commissioners outlining a transitional policy for non-grandfathered coverage in the individual health insurance market, as subsequently extended and modified (including by a communication entitled “Insurance Standards Bulletin Series—INFORMATION—Extension of Transitional Policy through Calendar Year 2017” issued on February 29, 2016, by the Director of the Center for Consumer Information & Insurance Oversight of such Centers).

“(iii) Individual health insurance market—The term “individual health insurance market” means the market for health insurance coverage (as defined in section 9832(b)) offered to individuals other than in connection with a group health plan (within the meaning of section 5000(b)(1)).”

“(D) Certain rules related to abortion

“(i) Option to purchase separate coverage or plan—Nothing in subparagraph (A) shall be construed as prohibiting any individual from purchasing separate coverage for abortions described in such subparagraph, or a health plan that includes such abortions, so long as no credit is allowed under this section with respect to the premiums for such coverage or plan.

“(ii) Option to offer coverage or plan—Nothing in subparagraph (A) shall restrict any health insurance issuer offering a health plan from offering separate coverage for abortions described in such subparagraph, or a plan that includes such abortions, so long as premiums for such separate coverage or plan are not paid for with any amount attributable to the credit allowed under this section (or the amount of any advance payment of the credit under section 1412 of the Patient Protection and Affordable Care Act).

“(iii) Other treatments—The treatment of any infection, injury, disease, or disorder that has been caused by or exacerbated by the performance of an abortion shall not be treated as an abortion for purposes of subparagraph (A).”

“(f) Exclusion of off-Exchange coverage—Advance payments under this section, and advance determinations under section 1411, with respect to any credit allowed under section 36B shall not be made with respect to any health plan which is not enrolled in through an Exchange.”

“(3) Information relating to off-Exchange premium credit eligible coverage—If minimum essential coverage provided to an individual under subsection (a) consists of a qualified health plan (as defined in section 36B(c)(3)) which is not enrolled in through an Exchange established under title I of the Patient Protection and Affordable Care Act, a return described in this subsection shall include—

“(A) a statement that such plan is a qualified health plan (as defined in section 36B(c)(3)),

“(B) the premiums paid with respect to such coverage,

“(C) the months during which such coverage is provided to the individual,

“(D) the adjusted monthly premium for the applicable second lowest cost silver plan (as defined in section 36B(b)(3)) for each such month with respect to such individual, and

“(E) such other information as the Secretary may prescribe.”

“(A) Applicable percentage

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

“(ii) Age determinations

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

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

“(iii) Indexing—In the case of any taxable year beginning in calendar year 2019, the initial and final percentages contained in clause (i) shall be adjusted to reflect—

“(I) the excess (if any) of the rate of premium growth for the period beginning with calendar year 2013 and ending with calendar year 2018, over the rate of income growth for such period, and

“(II) in addition to any adjustment under subclause (I), the excess (if any) of the rate of premium growth for calendar year 2018, over the rate of growth in the consumer price index for calendar year 2018.

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

changed “(h) Termination—No credit shall be allowed under this “(j) Shall not apply—This section shall not apply with respect to any coverage month which begins amounts paid or incurred in taxable years beginning after December 31, 2019.”

added “(1) In general—Any term”

added “(2) Exclusion of health plans including coverage for abortion

added “(A) In general—The term qualified health plan does not include any health plan that includes coverage for abortions (other than any abortion necessary to save the life of the mother or any abortion with respect to a pregnancy that is the result of an act of rape or incest).

added “(B) Certain rules related to abortion

added “(i) Option to purchase separate coverage or plan—Nothing in subparagraph (A) shall be construed as prohibiting any employer from purchasing for its employees separate coverage for abortions described in such subparagraph, or a health plan that includes such abortions, so long as no credit is allowed under this section with respect to the employer contributions for such coverage or plan.

added “(ii) Option to offer coverage or plan—Nothing in subparagraph (A) shall restrict any health insurance issuer offering a health plan from offering separate coverage for abortions described in such subparagraph, or a plan that includes such abortions, so long as such separate coverage or plan is not paid for with any employer contribution eligible for the credit allowed under this section.

added “(iii) Other treatments—The treatment of any infection, injury, disease, or disorder that has been caused by or exacerbated by the performance of an abortion shall not be treated as an abortion for purposes of subparagraph (A).”

removed “(g) Termination with respect to premium tax credit—Effective January 1, 2020, no provision of this section or section 1411 shall apply to the credit allowed under section 36B of the Internal Revenue Code of 1986 (or to the advance payment of, or determination of eligibility for, such credit or payment).”

removed “(j) Shall not apply—This section shall not apply with respect to amounts paid or incurred in taxable years beginning after December 31, 2019.”

removed “(1) In general—Any term”

removed “(2) Exclusion of health plans including coverage for abortion

removed “(A) In general—The term qualified health plan does not include any health plan that includes coverage for abortions (other than any abortion necessary to save the life of the mother or any abortion with respect to a pregnancy that is the result of an act of rape or incest) .

removed “(B) Certain rules related to abortion

removed “(i) Option to purchase separate coverage or plan—Nothing in subparagraph (A) shall be construed as prohibiting any employer from purchasing for its employees separate coverage for abortions described in such subparagraph, or a health plan that includes such abortions, so long as no credit is allowed under this section with respect to the employer contributions for such coverage or plan.

removed “(ii) Option to offer coverage or plan—Nothing in subparagraph (A) shall restrict any health insurance issuer offering a health plan from offering separate coverage for abortions described in such subparagraph, or a plan that includes such abortions, so long as such separate coverage or plan is not paid for with any employer contribution eligible for the credit allowed under this section.

removed “(iii) Other treatments—The treatment of any infection, injury, disease, or disorder that has been caused by or exacerbated by the performance of an abortion shall not be treated as an abortion for purposes of subparagraph (A).”

added Section 4980I of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:

added “(h) Shall not apply—No tax shall be imposed under this section with respect to any taxable period beginning after December 31, 2019, and before January 1, 2026.”

removed Section 4980I of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:

removed “(h) Shall not apply—No tax shall be imposed under this section with respect to any taxable period beginning after December 31, 2019, and before January 1, 2025.”

added Section 4191 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:

added “(d) Applicability—The tax imposed under subsection (a) shall not apply to sales after December 31, 2016.”

removed Section 4191 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:

removed “(d) Applicability—The tax imposed under subsection (a) shall not apply to sales after December 31, 2017.”

added “(b) Hospital insurance—In addition to the tax imposed by the preceding subsection, there is hereby imposed on the income of every individual a tax equal to 1.45 percent of the wages (as defined in section 3121(a)) received by such individual with respect to employment (as defined in section 3121(b)).”

added “(b) Hospital insurance—In addition to the tax imposed by the preceding subsection, there shall be imposed for each taxable year, on the self-employment income of every individual, a tax equal to 2.9 percent of the amount of the self-employment income for such taxable year.”

changed “(b) Hospital insurance—In addition to the tax imposed by the preceding subsection, there is hereby imposed on the income of every individual “36B. Refundable credit for coverage under a tax equal to 1.45 percent of the wages (as defined in section 3121(a)) received by such individual with respect to employment (as defined in section 3121(b)).”qualified health plan

added “(a) Allowance of premium tax credit—In the case of an individual, there shall be allowed as a credit against the tax imposed by this subtitle for the taxable year the sum of the monthly credit amounts with respect to such taxpayer for calendar months during such taxable year which are eligible coverage months appropriately taken into account under subsection (b)(2) with respect to the taxpayer or any qualifying family member of the taxpayer.

added “(b) Monthly credit amounts

added “(1) In general—The monthly credit amount with respect to any taxpayer for any calendar month is the lesser of—

added “(A) the sum of the monthly limitation amounts determined under subsection (c) with respect to the taxpayer and the taxpayer’s qualifying family members for such month, or

added “(B) the amount paid for a qualified health plan for the taxpayer and the taxpayer’s qualifying family members for such month.

added “(2) Eligible coverage month requirement—No amount shall be taken into account under subparagraph (A) or (B) of paragraph (1) with respect to any individual for any month unless such month is an eligible coverage month with respect to such individual.

added “(c) Monthly limitation amounts

added “(1) In general—The monthly limitation amount with respect to any individual for any eligible coverage month during any taxable year is 1/12 of—

added “(A) $2,000 in the case of an individual who has not attained age 30 as of the beginning of such taxable year,

added “(B) $2,500 in the case of an individual who has attained age 30 but who has not attained age 40 as of such time,

added “(C) $3,000 in the case of an individual who has attained age 40 but who has not attained age 50 as of such time,

added “(D) $3,500 in the case of an individual who has attained age 50 but who has not attained age 60 as of such time, and

added “(E) $4,000 in the case of an individual who has attained age 60 as of such time.

added “(2) Limitation based on modified adjusted gross income—The credit allowed under subsection (a) with respect to any taxpayer for any taxable year shall be reduced (but not below zero) by 10 percent of the excess (if any) of—

added “(A) the taxpayer’s modified adjusted gross income (as defined in section 36B(d)(2)(B), as in effect for taxable years beginning before January 1, 2020) for such taxable year, over

added “(B) $75,000 (twice such amount in the case of a joint return).

added “(3) Other limitations

added “(A) Aggregate dollar limitation—The sum of the monthly limitation amounts taken into account under this section with respect to any taxpayer for any taxable year shall not exceed $14,000.

added “(B) Maximum number of individuals taken into account—With respect to any taxpayer for any month, monthly limitation amounts shall be taken into account under this section only with respect to the 5 oldest individuals with respect to whom monthly limitation amounts could (without regard to this subparagraph) otherwise be so taken into account.

added “(d) Eligible coverage month—For purposes of this section, the term eligible coverage month means, with respect to any individual, any month if, as of the first day of such month, the individual meets the following requirements:

added “(1) The individual is covered by a health insurance coverage which is certified by the State in which such insurance is offered as coverage that meets the requirements for qualified health plans under subsection (f).

added “(2) The individual is not eligible for—

added “(A) coverage under a group health plan (within the meaning of section 5000(b)(1)) other than coverage under a plan substantially all of the coverage of which is of excepted benefits described in section 9832(c), or

added “(B) coverage described in section 5000A(f)(1)(A).

added “(3) The individual is either—

added “(A) a citizen or national of the United States, or

added “(B) a qualified alien (within the meaning of section 431 of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (8 U.S.C. 1641)).

added “(4) The individual is not incarcerated, other than incarceration pending the disposition of charges.

added “(e) Qualifying family member—For purposes of this section, the term qualifying family member means—

added “(1) in the case of a joint return, the taxpayer’s spouse,

added “(2) any dependent of the taxpayer, and

added “(3) with respect to any eligible coverage month, any child (as defined in section 152(f)(1)) of the taxpayer who as of the end of the taxable year has not attained age 27 if such child is covered for such month under a qualified health plan which also covers the taxpayer (in the case of a joint return, either spouse).

added “(f) Qualified health plan—For purposes of this section, the term qualified health plan means any health insurance coverage (as defined in section 9832(b)) if—

added “(1) such coverage is offered in the individual health insurance market within a State (within the meaning of section 5000A(f)(1)(C)),

added “(2) substantially all of such coverage is not of excepted benefits described in section 9832(c),

added “(3) such coverage does not consist of short-term limited duration insurance (within the meaning of section 2791(b)(5) of the Public Health Service Act),

added “(4) such coverage is not a grandfathered health plan (as defined in section 1251 of the Patient Protection and Affordable Care Act) or a grandmothered health plan (as defined in section 36B(c)(3)(C) as in effect for taxable years beginning before January 1, 2020), and

added “(5) such coverage does not include coverage for abortions (other than any abortion necessary to save the life of the mother or any abortion with respect to a pregnancy that is the result of an act of rape or incest).

added “(g) Special rules

added “(1) Married couples must file joint return

added “(A) In general—Except as provided in subparagraph (B), if the taxpayer is married (within the meaning of section 7703) at the close of the taxable year, no credit shall be allowed under this section to such taxpayer unless such taxpayer and the taxpayer’s spouse file a joint return for such taxable year.

added “(B) Exception for certain taxpayers—Subparagraph (A) shall not apply to any married taxpayer who—

added “(i) is living apart from the taxpayer's spouse at the time the taxpayer files the tax return,

added “(ii) is unable to file a joint return because such taxpayer is a victim of domestic abuse or spousal abandonment,

added “(iii) certifies on the tax return that such taxpayer meets the requirements of clauses (i) and (ii), and

added “(iv) has not met the requirements of clauses (i), (ii), and (iii) for each of the 3 preceding taxable years.

added “(2) Denial of credit to dependents

added “(A) In general—No credit shall be allowed under this section to any individual who is a dependent with respect to another taxpayer for a taxable year beginning in the calendar year in which such individual’s taxable year begins.

added “(B) Coordination with rule for older children—In the case of any individual who is a qualifying family member described in subsection (e)(3) with respect to another taxpayer for any month, in determining the amount of any credit allowable to such individual under this section for any taxable year of such individual which includes such month, the monthly limitation amount with respect to such individual for such month shall be zero and no amount paid for any qualified health plan with respect to such individual for such month shall be taken into account.

added “(3) Coordination with medical expense deduction—Amounts described in subsection (b)(1)(B) with respect to any month shall not be taken into account in determining the deduction allowed under section 213 except to the extent that such amounts exceed the amount described in subsection (b)(1)(A) with respect to such month.

added “(4) Coordination with advance payments of credit—With respect to any taxable year—

added “(A) the amount which would (but for this subsection) be allowed as a credit to the taxpayer under subsection (a) shall be reduced (but not below zero) by the aggregate amount paid on behalf of such taxpayer under section 1412 of the Patient Protection and Affordable Care Act for months beginning in such taxable year, and

added “(B) the tax imposed by section 1 for such taxable year shall be increased by the excess (if any) of—

added “(i) the aggregate amount paid on behalf of such taxpayer under such section 1412 for months beginning in such taxable year, over

added “(ii) the amount which would (but for this subsection) be allowed as a credit to the taxpayer under subsection (a).

added “(5) Special rules for qualified small employer health reimbursement arrangements

added “(A) In general—If the taxpayer or any qualifying family member of the taxpayer is provided a qualified small employer health reimbursement arrangement for an eligible coverage month, the sum determined under subsection (b)(1)(A) with respect to the taxpayer shall be reduced (but not below zero) by 1/12 of the permitted benefit (as defined in section 9831(d)(3)(C)) under such arrangement for each such month such arrangement is provided to such taxpayer.

added “(B) Qualified small employer health reimbursement arrangement—For purposes of this paragraph, the term qualified small employer health reimbursement arrangement has the meaning given such term by section 9831(d)(2).

added “(C) Coverage for less than entire year—In the case of an employee who is provided a qualified small employer health reimbursement arrangement for less than an entire year, subparagraph (A) shall be applied by substituting “the number of months during the year for which such arrangement was provided” for “12”.

added “(6) Certain rules related to nonqualified health plans—The rules of section 36B(c)(3)(D), as in effect for taxable years beginning before January 1, 2020, shall apply with respect to subsection (f)(5).

added “(7) Inflation adjustment

added “(A) In general—In the case of any taxable year beginning in a calendar year after 2020, each dollar amount in subsection (c)(1), the $75,000 amount in subsection (c)(2)(B), and the dollar amount in subsection (c)(3)(A), shall be increased by an amount equal to—

added “(i) such dollar amount, multiplied by

added “(ii) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined—

added “(I) by substituting “calendar year 2019” for “calendar year 1992” in subparagraph (B) thereof, and

added “(II) by substituting for the CPI referred to section 1(f)(3)(A) the amount that such CPI would have been if the annual percentage increase in CPI with respect to each year after 2019 had been one percentage point greater.

added “(B) Terms related to CPI

added “(i) Annual percentage increase—For purposes of subparagraph (A)(ii)(II), the term annual percentage increase means the percentage (if any) by which CPI for any year exceeds CPI for the prior year.

added “(ii) Other terms—Terms used in this paragraph which are also used in section 1(f)(3) shall have the same meanings as when used in such section.

added “(C) Rounding—Any increase determined under subparagraph (A) shall be rounded to the nearest multiple of $50.

added “(8) Rules related to State certification of qualified health plans—A certification shall not be taken into account under subsection (d)(1) unless such certification is made available to the public and meets such other requirements as the Secretary may provide.

added “(9) Regulations—The Secretary may prescribe such regulations and other guidance as may be necessary or appropriate to carry out this section and section 1412 of the Patient Protection and Affordable Care Act.”

changed “(b) Hospital insurance—In addition “(f) Application to certain plans—The Secretary and the tax imposed by Secretary of the preceding subsection, there Treasury shall be imposed for prescribe such regulations as each taxable year, on respective Secretary may deem necessary in order to establish and operate the self-employment income of every individual, advance payment program established under this section for individuals covered under qualified health plans (whether enrolled in through an Exchange or otherwise) in such a tax equal to 2.9 percent manner that protects taxpayer information (including names, taxpayer identification numbers, and other confidential information), provides robust verification of the amount all information necessary to establish eligibility of the self-employment income taxpayer for such taxable year.”advance payments under this section, ensures proper and timely payments to appropriate health providers, and protects program integrity to the maximum extent feasible.”

added “(16) each month with respect to which the employee is eligible for coverage described in section 36B(d)(2) in connection with employment with the employer.”

added “(14) Coordination with health insurance coverage credit

added “(A) In general—An eligible coverage month to which the election under paragraph (11) applies shall not be treated as an eligible coverage month (as defined in section 36B(d)) for purposes of section 36B with respect to the taxpayer or any of the taxpayer’s qualifying family members (as defined in section 36B(e)).

added “(B) Coordination with advance payments of health insurance coverage credit—In the case of a taxpayer who makes the election under paragraph (11) with respect to any eligible coverage month in a taxable year or on behalf of whom any advance payment is made under section 7527 with respect to any month in such taxable year—

added “(i) the tax imposed by this chapter for the taxable year shall be increased by the excess, if any, of—

added “(I) the sum of any advance payments made on behalf of the taxpayer under section 7527 and section 1412 of the Patient Protection and Affordable Care Act, over

added “(II) the sum of the credits allowed under this section (determined without regard to paragraph (1)) and section 36B (determined without regard to subsection (g)(4)(A) thereof) for such taxable year, and

added “(ii) section 36B(g)(4)(B) shall not apply with respect to such taxpayer for such taxable year.”

added “(6) Coordination with health insurance coverage credit—The deduction otherwise allowable to a taxpayer under paragraph (1) for any taxable year shall be reduced (but not below zero) by the amount of the credit allowable to such taxpayer under section 36B (determined without regard to subsection (g)(4)(A) thereof) for such taxable year.”

removed “36C. Health insurance coverage

removed “(a) In general—In the case of an individual, there shall be allowed as a credit against the tax imposed by this subtitle for the taxable year the sum of the monthly credit amounts with respect to such taxpayer for calendar months during such taxable year.

removed “(b) Monthly credit amounts

removed “(1) In general—The monthly credit amount with respect to any taxpayer for any calendar month is the lesser of—

removed “(A) the sum of the monthly limitation amounts determined under subsection (c) with respect to the taxpayer and the taxpayer’s qualifying family members for such month, or

removed “(B) the amount paid for eligible health insurance for the taxpayer and the taxpayer’s qualifying family members for such month.

removed “(2) Eligible coverage month requirement—No amount shall be taken into account under subparagraph (A) or (B) of paragraph (1) with respect to any individual for any month unless such month is an eligible coverage month with respect to such individual.

removed “(c) Monthly limitation amounts

removed “(1) In general—The monthly limitation amount with respect to any individual for any eligible coverage month during any taxable year is 1/12 of—

removed “(A) $2,000 in the case of an individual who has not attained age 30 as of the beginning of such taxable year,

removed “(B) $2,500 in the case of an individual who has attained age 30 but who has not attained age 40 as of such time,

removed “(C) $3,000 in the case of an individual who has attained age 40 but who has not attained age 50 as of such time,

removed “(D) $3,500 in the case of an individual who has attained age 50 but who has not attained age 60 as of such time, and

removed “(E) $4,000 in the case of an individual who has attained age 60 as of such time.

removed “(2) Limitation based on modified adjusted gross income

removed “(A) In general—The amount otherwise determined under subsection (b)(1)(A) (without regard to this subparagraph but after any other adjustment of such amount under this section) for the taxable year shall be reduced (but not below zero) by 10 percent of the excess (if any) of—

removed “(i) the taxpayer’s modified adjusted gross income for such taxable year, over

removed “(ii) $75,000 (twice such amount in the case of a joint return).

removed “(B) Modified adjusted gross income—For purposes of this paragraph, the term “modified adjusted gross income” means adjusted gross income increased by—

removed “(i) any amount excluded from gross income under section 911,

removed “(ii) any amount of interest received or accrued by the taxpayer during the taxable year which is exempt from tax, and

removed “(iii) an amount equal to the portion of the taxpayer’s social security benefits (as defined in section 86(d)) which is not included in gross income under section 86 for the taxable year.

removed “(3) Other limitations

removed “(A) Aggregate dollar limitation—The sum of the monthly limitation amounts taken into account under this section with respect to any taxpayer for any taxable year shall not exceed $14,000.

removed “(B) Maximum number of individuals taken into account—With respect to any taxpayer for any month, monthly limitation amounts shall be taken into account under this section only with respect to the 5 oldest individuals with respect to whom monthly limitation amounts could (without regard to this subparagraph) otherwise be so taken into account.

removed “(d) Eligible coverage month—For purposes of this section, the term eligible coverage month means, with respect to any individual, any month if, as of the first day of such month, the individual—

removed “(1) is covered by eligible health insurance,

removed “(2) is not eligible for other specified coverage,

removed “(3) is either—

removed “(A) a citizen or national of the United States, or

removed “(B) a qualified alien (within the meaning of section 431 of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (8 U.S.C. 1641)), and

removed “(4) is not incarcerated, other than incarceration pending the disposition of charges.

removed “(e) Qualifying family member—For purposes of this section, the term qualifying family member means—

removed “(1) in the case of a joint return, the taxpayer’s spouse,

removed “(2) any dependent of the taxpayer, and

removed “(3) with respect to any eligible coverage month, any child (as defined in section 152(f)(1)) of the taxpayer who as of the end of the taxable year has not attained age 27 if such child is covered for such month under eligible health insurance which also covers the taxpayer (in the case of a joint return, either spouse).

removed “(f) Eligible health insurance—For purposes of this section—

removed “(1) In general—The term eligible health insurance means any health insurance coverage (as defined in section 9832(b)) if—

removed “(A) such coverage is either—

removed “(i) offered in the individual health insurance market within a State, or

removed “(ii) is unsubsidized COBRA continuation coverage,

removed “(B) such coverage is not a grandfathered health plan (as defined in section 1251 of the Patient Protection and Affordable Care Act) or a grandmothered health plan,

removed “(C) substantially all of such coverage is not of excepted benefits described in section 9832(c),

removed “(D) such coverage does not include coverage for abortions (other than any abortion necessary to save the life of the mother or any abortion with respect to a pregnancy that is the result of an act of rape or incest),

removed “(E) such coverage does not consist of short-term limited duration insurance (as defined by the Secretary), and

removed “(F) the State in which such insurance is offered certifies that such coverage meets the requirements of this paragraph.

removed “(2) Rules related to State certification

removed “(A) Certification made available to public—A certification shall not be taken into account under paragraph (1)(E) unless such certification is made available to the public and meets such other requirements as the Secretary may provide.

removed “(B) Special rule for unsubsidized COBRA continuation coverage—In the case of unsubsidized COBRA continuation coverage—

removed “(i) paragraph (1)(E) shall be applied by substituting “the plan administrator (as defined in section 414(g)) of the health plan” for “the State in which such insurance is offered”, and

removed “(ii) the requirements of subparagraph (A) shall be treated as satisfied if the certification meets such requirements as the Secretary may provide.

removed “(3) Grandmothered health plan

removed “(A) In general—The term “grandmothered health plan” means health insurance coverage which is offered in the individual health insurance market as of January 1, 2013, and is permitted to be offered in such market after January 1, 2014, as a result of CCIIO guidance.

removed “(B) CCIIO guidance defined—The term CCIIO guidance means the letter issued by the Centers for Medicare & Medicaid Services on November 14, 2013, to the State Insurance Commissioners outlining a transitional policy for non-grandfathered coverage in the individual health insurance market, as subsequently extended and modified (including by a communication entitled “Insurance Standards Bulletin Series—INFORMATION—Extension of Transitional Policy through Calendar Year 2017” issued on February 29, 2016, by the Director of the Center for Consumer Information & Insurance Oversight of such Centers).

removed “(4) Individual health insurance market—The term “individual health insurance market” means the market for health insurance coverage (as defined in section 9832(b)) offered to individuals other than in connection with a group health plan (within the meaning of section 5000(b)(1)).

removed “(g) Other specified coverage—For purposes of this section—

removed “(1) In general—The term “other specified coverage” means any of the following:

removed “(A) Coverage under a group health plan (within the meaning of section 5000(b)(1)) other than—

removed “(i) coverage under a plan substantially all of the coverage of which is of excepted benefits described in section 9832(c), and

removed “(ii) COBRA continuation coverage.

removed “(B) Coverage under the Medicare program under part A of title XVIII of the Social Security Act.

removed “(C) Coverage under the Medicaid program under title XIX of the Social Security Act.

removed “(D) Coverage under the CHIP program under title XXI of the Social Security Act.

removed “(E) Medical coverage under chapter 55 of title 10, United States Code, including coverage under the TRICARE program.

removed “(F) Coverage under a health care program under chapter 17 or 18 of title 38, United States Code, as determined by the Secretary of Veterans Affairs, in coordination with the Secretary of Health and Human Services and the Secretary of the Treasury.

removed “(G) Coverage under a health plan under section 2504(e) of title 22, United States Code (relating to Peace Corps volunteers).

removed “(H) Coverage under the Nonappropriated Fund Health Benefits Program of the Department of Defense, established under section 349 of the National Defense Authorization Act for Fiscal Year 1995 (Public Law 103–337; 10 U.S.C. 1587 note).

removed “(2) Special rule with respect to veterans health programs—In the case of other specified coverage described in paragraph (1)(F), an individual shall not be treated as eligible for such coverage unless such individual is enrolled in such coverage.

removed “(h) Unsubsidized COBRA continuation coverage—For purposes of this section—

removed “(1) In general—The term “unsubsidized COBRA continuation coverage” means COBRA continuation coverage no portion of the premiums for which are subsidized by the employer.

removed “(2) COBRA continuation coverage—The term “COBRA continuation coverage” means continuation coverage provided pursuant to part 6 of subtitle B of title I of the Employee Retirement Income Security Act of 1974 (other than under section 609), title XXII of the Public Health Service Act, section 4980B of the Internal Revenue Code of 1986 (other than subsection (f)(1) of such section insofar as it relates to pediatric vaccines), or section 8905a of title 5, United States Code, or under a State program that provides comparable continuation coverage. Such term shall not include coverage under a health flexible spending arrangement.

removed “(i) Special rules

removed “(1) Married couples must file joint return—If the taxpayer is married (within the meaning of section 7703) at the close of the taxable year, no credit shall be allowed under this section to such taxpayer unless such taxpayer and the taxpayer’s spouse file a joint return for such taxable year.

removed “(2) Denial of credit to dependents

removed “(A) In general—No credit shall be allowed under this section to any individual who is a dependent with respect to another taxpayer for a taxable year beginning in the calendar year in which such individual’s taxable year begins.

removed “(B) Coordination with rule for older children—In the case of any individual who is a qualifying family member described in subsection (e)(3) with respect to another taxpayer for any month, in determining the amount of any credit allowable to such individual under this section for any taxable year of such individual which includes such month, the monthly limitation amount with respect to such individual for such month shall be zero and no amount paid for eligible health insurance with respect to such individual for such month shall be taken into account.

removed “(3) Coordination with medical expense deduction—Amounts described in subsection (b)(1)(B) with respect to any month shall not be taken into account in determining the deduction allowed under section 213 except to the extent that such amounts exceed the amount described in subsection (b)(1)(A) with respect to such month.

removed “(4) Insurance which covers other individuals—For purposes of this section, rules similar to the rules of section 213(d)(6) shall apply with respect to any contract for eligible health insurance under which amounts are payable for coverage of an individual other than the taxpayer and the taxpayer’s qualifying family members.

removed “(5) Coordination with advance payments of credit—With respect to any taxable year—

removed “(A) the amount which would (but for this subsection) be allowed as a credit to the taxpayer under subsection (a) shall be reduced (but not below zero) by the aggregate amount paid on behalf of such taxpayer under section 7529 for months beginning in such taxable year, and

removed “(B) the tax imposed by section 1 for such taxable year shall be increased by the excess (if any) of—

removed “(i) the aggregate amount paid on behalf of such taxpayer under section 7529 for months beginning in such taxable year, over

removed “(ii) the amount which would (but for this subsection) be allowed as a credit to the taxpayer under subsection (a).

removed “(6) Special rules for qualified small employer health reimbursement arrangements

removed “(A) In general—If the taxpayer or any qualifying family member of the taxpayer is provided a qualified small employer health reimbursement arrangement for any eligible coverage month, the sum determined under subsection (b)(1)(A) with respect to the taxpayer for such month shall be reduced (but not below zero) by 1/12 of the permitted benefit (as defined in section 9831(d)(3)(C)) under such arrangement.

removed “(B) Qualified small employer health reimbursement arrangement—For purposes of this paragraph, the term “qualified small employer health reimbursement arrangement” has the meaning given such term by section 9831(d)(2).

removed “(C) Coverage for less than entire year—In the case of an employee who is provided a qualified small employer health reimbursement arrangement for less than an entire year, subparagraph (A) shall be applied by substituting “the number of months during the year for which such arrangement was provided” for “12”.

removed “(7) Certain rules related to abortion

removed “(A) Option to purchase separate coverage or plan—Nothing in subsection (f)(1)(D) shall be construed as prohibiting any individual from purchasing separate coverage for abortions described in such subparagraph, or a health plan that includes such abortions, so long as no credit is allowed under this section with respect to the premiums for such coverage or plan.

removed “(B) Option to offer coverage or plan—Nothing in subsection (f)(1)(D) shall restrict any health insurance issuer offering a health plan from offering separate coverage for abortions described in such clause, or a plan that includes such abortions, so long as premiums for such separate coverage or plan are not paid for with any amount attributable to the credit allowed under this section.

removed “(C) Other treatments—The treatment of any infection, injury, disease, or disorder that has been caused by or exacerbated by the performance of an abortion shall not be treated as an abortion for purposes of subsection (f)(1)(D).

removed “(8) Inflation adjustment

removed “(A) In general—In the case of any taxable year beginning in a calendar year after 2020, each dollar amount in subsection (c)(1), the $75,000 amount in subsection (c)(2)(A)(ii), and the dollar amount in subsection (c)(3)(A), shall be increased by an amount equal to—

removed “(i) such dollar amount, multiplied by

removed “(ii) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined—

removed “(I) by substituting “calendar year 2019” for “calendar year 1992” in subparagraph (B) thereof, and

removed “(II) by substituting for the CPI referred to section 1(f)(3)(A) the amount that such CPI would have been if the annual percentage increase in CPI with respect to each year after 2019 had been one percentage point greater.

removed “(B) Terms related to CPI

removed “(i) Annual percentage increase—For purposes of subparagraph (A)(ii)(II), the term “annual percentage increase” means the percentage (if any) by which CPI for any year exceeds CPI for the prior year.

removed “(ii) Other terms—Terms used in this paragraph which are also used in section 1(f)(3) shall have the same meanings as when used in such section.

removed “(C) Rounding—Any increase determined under subparagraph (A) shall be rounded to the nearest multiple of $50.

removed “(9) Regulations—The Secretary may prescribe such regulations and other guidance as may be necessary or appropriate to carry out this section, section 6050X, and section 7529.”

removed “7529. Advance payment of health insurance coverage credit

removed “(a) General rule—Not later than January 1, 2020, the Secretary, in consultation with the Secretary of Health and Human Services, the Secretary of Homeland Security, and the Commissioner of Social Security, shall establish a program (hereafter in this section referred to as the “advance payment program”) for making payments to providers of eligible health insurance on behalf of taxpayers eligible for the credit under section 36C.

removed “(b) Limitation—The aggregate payments made under this section with respect to any taxpayer, determined as of any time during any calendar year, shall not exceed the monthly credit amounts determined with respect to such taxpayer under section 36C for months during such calendar year which have ended as of such time.

removed “(c) Administration

removed “(1) In general—The advance payment program shall, to the greatest extent practicable, use the methods and procedures used to administer the programs created under sections 1411 and 1412 of the Patient Protection and Affordable Care Act (determined without regard to section 1412(f) of such Act) and each entity that is authorized to take any actions under the programs created under such sections (as so determined) shall, at the request of the Secretary, take such actions to the extent necessary to carry out this section.

removed “(2) Application to off-Exchange coverage—Except as otherwise provided by the Secretary, for purposes of applying this subsection in the case of eligible health insurance which is not enrolled in through an Exchange established under title I of the Patient Protection and Affordable Care Act, the sections referred to in paragraph (1) shall be applied by treating references in such sections to an Exchange as references to the provider of such eligible health insurance (or, as the Secretary determines appropriate, to the licensed agent or broker with respect to such insurance), except that the Secretary of Health and Human Services shall carry out the responsibilities of the Exchange under section 1411(e)(4) of the Patient Protection and Affordable Care Act (determined without regard to section 1412(f) of such Act) in the case of such insurance.

removed “(3) Documentation regarding other specified coverage

removed “(A) In general—The advance payment program shall provide that any individual applying to have payments made on their behalf under such program shall, if such individual (or any qualifying family member of such individual taken into account in determining the amount of the credit allowable under section 36C) is employed, submit a written statement from each employer of such individual or such qualifying family member stating whether such individual or qualifying family member (as the case may be) is eligible for other specified coverage in connection with such employment.

removed “(B) Issuance of statements—An employer shall, at the request of any employee, provide the statement under subparagraph (A) at such time, and in such form and manner, as the Secretary may provide.

removed “(d) Definitions—For purposes of this section, terms used in this section which are also used in section 36C shall have the same meaning as when used in section 36C.

removed “7530. Excess health insurance coverage credit payable to health savings account

removed “(a) In general—At the request of an eligible taxpayer, the Secretary shall make a payment to the trustee of the designated health savings account with respect to such taxpayer in an amount equal to the sum of the excesses (if any) described in subsection (c)(2) with respect to months in the taxable year.

removed “(b) Designated health savings account—The term “designated health savings account” means a health savings account of an individual described in subsection (c)(3) which is identified by the eligible taxpayer for purposes of this section.

removed “(c) Eligible taxpayer—The term “eligible taxpayer” means, with respect to any taxable year, any taxpayer if—

removed “(1) such taxpayer is allowed a credit under section 36C for such taxable year,

removed “(2) the amount described in subparagraph (A) of section 36C(b)(1) exceeds the amount described in subparagraph (B) of such section with respect to such taxpayer applied with respect to any month during such taxable year, and

removed “(3) the taxpayer or one or more of the taxpayer’s qualifying family members (as defined in section 36C(e)) were eligible individuals (as defined in section 223(c)(1)) for one or more months during such taxable year.

removed “(d) Contributions treated as rollovers, etc

removed “(1) In general—Any amount paid the Secretary to a health savings account under this section shall be treated for purposes of this title in the same manner as a rollover contribution described in section 223(f)(5).

removed “(2) Coordination with limitation on rollovers—Any amount described in paragraph (1) shall not be taken into account in applying section 223(f)(5)(B) with respect to any other amount and the limitation of section 223(f)(5)(B) shall not apply with respect to the application of paragraph (1).

removed “(e) Form and manner of request—The request referred to in subsection (a) shall be made at such time and in such form and manner as the Secretary may provide. To the extent that the Secretary determines feasible, such request may identify more than one designated health savings account (and the amount to be paid to each such account) provided that the aggregate of such payments with respect to any taxpayer for any taxable year do not exceed the excess described in subsection (c)(2).

removed “(f) Taxpayers with seriously delinquent tax debt—In the case of an individual who has a seriously delinquent tax debt (as defined in section 7345(b)) which has not been fully satisfied—

removed “(1) if such individual is the eligible taxpayer (or, in the case of a joint return, either spouse), the Secretary shall not make any payment under this section with respect to such taxpayer, and

removed “(2) if such individual is the account beneficiary (as defined in section 223(d)(3)) of any health savings account, the Secretary shall not make any payment under this section to such health savings account.

removed “(g) Advance payment—To the extent that the Secretary determines feasible, payment under this section may be made in advance on a monthly basis under rules similar to the rules of sections 7529 and 36C(i)(5)(B).”

removed “6050X. Returns by health insurance providers relating to health insurance coverage credit

removed “(a) Requirement of reporting—Every person who provides eligible health insurance for any month of any calendar year with respect to any individual shall, at such time as the Secretary may prescribe, make the return described in subsection (b) with respect to each such individual. With respect to any individual with respect to whom payments under section 7529 are made by the Secretary, the reporting under subsection (b) shall be made on a monthly basis.

removed “(b) Form and manner of returns—A return is described in this subsection if such return—

removed “(1) is in such form as the Secretary may prescribe, and

removed “(2) contains, with respect to each policy of eligible health insurance—

removed “(A) the name, address, and TIN of each individual covered under such policy,

removed “(B) the premiums paid with respect to such policy,

removed “(C) the amount of advance payments made on behalf of the individual under section 7529,

removed “(D) the months during which such health insurance is provided to the individual,

removed “(E) whether such policy constitutes a high deductible health plan (as defined in section 223(c)(2)), and

removed “(F) such other information as the Secretary may prescribe.

removed “(c) Statements to be furnished to individuals with respect to whom information is required—Every person required to make a return under subsection (a) shall furnish to each individual whose name is required to be set forth in such return a written statement showing—

removed “(1) the name and address of the person required to make such return and the phone number of the information contact for such person, and

removed “(2) the information required to be shown on the return with respect to such individual.

removed “(d) Definitions—For purposes of this section, terms used in this section which are also used in section 36C shall have the same meaning as when used in section 36C.”

removed “(16) each month with respect to which the employee is eligible for other specified coverage (as defined in section 36C(g)) in connection with employment with the employer.”

removed “(xxvi) section 6050X (relating to returns relating to health insurance coverage credit),”

removed “(JJ) section 6050X (relating to returns relating to health insurance coverage credit), or

removed “(KK) section 7529(c)(3) (relating to documentation regarding other specified coverage).”

removed “(i) to an Exchange”

removed “(ii) in the case of any credit under section 36C with respect to any health insurance, the amount of such credit (or the amount of any advance payment of such credit) to the provider of such insurance (or, as the Secretary determines appropriate, the licensed agent or broker with respect to such insurance).”

removed “(14) Coordination with health insurance coverage credit

removed “(A) In general—An eligible coverage month to which the election under paragraph (11) applies shall not be treated as an eligible coverage month (as defined in section 36C(d)) for purposes of section 36C with respect to the taxpayer or any of the taxpayer’s qualifying family members (as defined in section 36C(e)).

removed “(B) Coordination with advance payments of health insurance coverage credit—In the case of a taxpayer who makes the election under paragraph (11) with respect to any eligible coverage month in a taxable year or on behalf of whom any advance payment is made under section 7527 with respect to any month in such taxable year—

removed “(i) the tax imposed by this chapter for the taxable year shall be increased by the excess, if any, of—

removed “(I) the sum of any advance payments made on behalf of the taxpayer under sections 7527 and 7529 for months during such taxable year, over

removed “(II) the sum of the credits allowed under this section (determined without regard to paragraph (1)) and section 36C (determined without regard to subsection (i)(5)(A) thereof) for such taxable year, and

removed “(ii) section 36C(i)(5)(B) shall not apply with respect to such taxpayer for such taxable year.”

removed “(6) Coordination with health insurance coverage credit—The deduction otherwise allowable to a taxpayer under paragraph (1) for any taxable year shall be reduced (but not below zero) by the sum of—

removed “(A) the amount of the credit allowable to such taxpayer under section 36C (determined without regard to subsection (i)(5)(A) thereof) for such taxable year, plus

removed “(B) the aggregate payments made with respect to the taxpayer under section 7530 for months during such taxable year.”

added “(5) Special rule for married individuals with family coverage

added “(A) In general—In the case of individuals who are married to each other, if both spouses are eligible individuals and either spouse has family coverage under a high deductible health plan as of the first day of any month—

added “(i) the limitation under paragraph (1) shall be applied by not taking into account any other high deductible health plan coverage of either spouse (and if such spouses both have family coverage under separate high deductible health plans, only one such coverage shall be taken into account),

added “(ii) such limitation (after application of clause (i)) shall be reduced by the aggregate amount paid to Archer MSAs of such spouses for the taxable year, and

added “(iii) such limitation (after application of clauses (i) and (ii)) shall be divided equally between such spouses unless they agree on a different division.

added “(B) Treatment of additional contribution amounts—If both spouses referred to in subparagraph (A) have attained age 55 before the close of the taxable year, the limitation referred to in subparagraph (A)(iii) which is subject to division between the spouses shall include the additional contribution amounts determined under paragraph (3) for both spouses. In any other case, any additional contribution amount determined under paragraph (3) shall not be taken into account under subparagraph (A)(iii) and shall not be subject to division between the spouses.”

changed “(5) Special rule “(D) Treatment of certain medical expenses incurred before establishment of account—If a health savings account is established during the 60-day period beginning on the date that coverage of the account beneficiary under a high deductible health plan begins, then, solely for married individuals with family coveragepurposes of determining whether an amount paid is used for a qualified medical expense, such account shall be treated as having been established on the date that such coverage begins.”

removed “(A) In general—In the case of individuals who are married to each other, if both spouses are eligible individuals and either spouse has family coverage under a high deductible health plan as of the first day of any month—

removed “(i) the limitation under paragraph (1) shall be applied by not taking into account any other high deductible health plan coverage of either spouse (and if such spouses both have family coverage under separate high deductible health plans, only one such coverage shall be taken into account),

removed “(ii) such limitation (after application of clause (i)) shall be reduced by the aggregate amount paid to Archer MSAs of such spouses for the taxable year, and

removed “(iii) such limitation (after application of clauses (i) and (ii)) shall be divided equally between such spouses unless they agree on a different division.

removed “(B) Treatment of additional contribution amounts—If both spouses referred to in subparagraph (A) have attained age 55 before the close of the taxable year, the limitation referred to in subparagraph (A)(iii) which is subject to division between the spouses shall include the additional contribution amounts determined under paragraph (3) for both spouses. In any other case, any additional contribution amount determined under paragraph (3) shall not be taken into account under subparagraph (A)(iii) and shall not be subject to division between the spouses.”

changed Section Subsection (j) of section 9008 of the Patient Protection and Affordable Care Act is amended by adding at the end the following new subsection:to read as follows:

changed “(l) Termination—No fee “(j) Repeal—This section shall be imposed under subsection (a)(1) with respect apply to any calendar year years beginning after December 31, 2010, and ending before January 1, 2017.”

changed Section Subsection (j) of section 9010 of the Patient Protection and Affordable Care Act is amended by adding at the end the following new subsection:to read as follows:

changed “(k) Termination—No fee “(j) Repeal—This section shall be imposed under subsection (a)(1) with respect apply to any calendar year years beginning after December 31, 2013, and ending before January 1, 2017.”

Paragraph (6) of section 162(m) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:

changed “(I) Termination—This paragraph shall not apply to taxable years beginning after December 31, 2017.”2016.”