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115th Congress }                                          { Rept. 115- 161
                        HOUSE OF REPRESENTATIVES
 1st Session   }                                          { Part 1

======================================================================
 
                           VERIFY FIRST ACT

                                _______
                                

  June 2, 2017.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

Mr. Brady of Texas, from the Committee on Ways and Means, submitted the 
                               following

                              R E P O R T

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 2581]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Ways and Means, to whom was referred the 
bill (H.R. 2581) to amend the Internal Revenue Code of 1986 to 
require the provision of Social Security numbers as a condition 
of receiving the health insurance premium tax credit, having 
considered the same, report favorably thereon with an amendment 
and recommend that the bill as amended do pass.

                                CONTENTS

                                                                   Page
  I. SUMMARY AND BACKGROUND...........................................3
          A. Purpose and Summary.................................     3
          B. Background and Need for Legislation.................     3
          C. Legislative History.................................     4
 II. EXPLANATION OF THE BILL..........................................5
          A. Verification of Status in United States as Condition 
              of Receiving Advance Payment of Health Insurance 
              Premium Tax Credit.................................     5
III. VOTES OF THE COMMITTEE...........................................8
 IV. BUDGET EFFECTS OF THE BILL......................................10
          A. Committee Estimate of Budgetary Effects.............    10
          B. Statement Regarding New Budget Authority and Tax 
              Expenditures Budget Authority......................    10
          C. Cost Estimate Prepared by the Congressional Budget 
              Office.............................................    10
  V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE......12
          A. Committee Oversight Findings and Recommendations....    12
          B. Statement of General Performance Goals and 
              Objectives.........................................    12
          C. Information Relating to Unfunded Mandates...........    12
          D. Applicability of House Rule XXI 5(b)................    12
          E. Tax Complexity Analysis.............................    12
          F. Congressional Earmarks, Limited Tax Benefits, and 
              Limited Tariff Benefits............................    13
          G. Duplication of Federal Programs.....................    13
          H. Disclosure of Directed Rule Makings.................    13
 VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED...........13
VII. DISSENTING VIEWS................................................38

    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Verify First Act''.

SEC. 2. VERIFICATION OF STATUS IN UNITED STATES AS CONDITION OF 
                    RECEIVING ADVANCE PAYMENT OF HEALTH INSURANCE 
                    PREMIUM TAX CREDIT.

  (a) Application to Current Health Insurance Premium Tax Credit.--
Section 36B of the Internal Revenue Code of 1986, as in effect for 
months beginning before January 1, 2020, is amended by redesignating 
subsection (g) as subsection (h) and by inserting after subsection (f) 
the following new subsection:
  ``(g) Verification of Status in United States for Advance Payment.--
No advance payment of the credit allowed under this section with 
respect to any premium under subsection (b)(2)(A) with respect to any 
individual shall be made under section 1412 of the Patient Protection 
and Affordable Care Act unless the Secretary has received confirmation 
from the Secretary of Health and Human Services that the Commissioner 
of Social Security or the Secretary of Homeland Security has verified 
under section 1411(c)(2) of such Act the individual's status as a 
citizen or national of the United States or an alien lawfully present 
in the United States using a process that includes the appropriate use 
of information related to citizenship or immigration status, such as 
social security account numbers (but not individual taxpayer 
identification numbers).''.
  (b) Application to New Health Insurance Premium Tax Credit.--Section 
36B of the Internal Revenue Code of 1986, as amended by the American 
Health Care Act of 2017 and in effect for months beginning after 
December 31, 2019, is amended by adding at the end the following new 
subsection:
  ``(h) Verification of Status in United States for Advance Payment.--
No advance payment of the credit allowed under this section with 
respect to any amount under subparagraph (A) or (B) of subsection 
(b)(1) with respect to any individual shall be made under section 1412 
of the Patient Protection and Affordable Care Act unless the Secretary 
has received confirmation from the Secretary of Health and Human 
Services that the Commissioner of Social Security or the Secretary of 
Homeland Security has verified under section 1411(c)(2) of such Act the 
individual's status as a citizen or national of the United States or 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)) using a process that includes the appropriate use of 
information related to citizenship or immigration status, such as 
social security account numbers (but not individual taxpayer 
identification numbers).''.
  (c) Conforming Amendment on Continuous Health Insurance Coverage 
Provision.--Section 2710A(b)(1) of the Public Health Service Act, as 
added by section 133 of the American Health Care Act of 2017, is 
amended by adding after subparagraph (C) the following:
        ``In the case of an individual who applies for advance payment 
        of a credit under section 1412 of the Patient Protection and 
        Affordable Care Act and for whom a determination of eligibility 
        for such advance payment is delayed by reason of the 
        requirement for verification of the individual's status in the 
        United States under section 1411(c)(2) of such Act, the period 
        of days beginning with the date of application for advance 
        payment and ending with the date of such verification shall not 
        be taken into account in applying subparagraph (B). The 
        Secretary shall establish a procedure by which information 
        relating to this period is provided to the individual.''.
  (d) Delay Permitted in Coverage Date in Case of Delay in Verification 
of Status for Individuals Applying for Advance Payment of Credit.--
Section 1411(e) of the Patient Protection and Affordable Care Act (42 
U.S.C. 18081(e)) is amended--
          (1) in paragraph (3), by inserting after ``applicant's 
        eligibility'' the following: ``(other than eligibility for 
        advance payment of a credit under section 1412)''; and
          (2) by adding at the end the following new paragraph:
          ``(5) Delay permitted in coverage date in case of delay in 
        verification of status for individuals applying for advance 
        payment of credit.--In the case of an individual whose 
        eligibility for advance payments is delayed by reason of the 
        requirement for verification under subsection (c)(2), if, for 
        coverage to be effective as of the date requested in the 
        individual's application for enrollment, the individual would 
        (but for this paragraph) be required to pay 2 or more months of 
        retroactive premiums, the individual shall be provided the 
        option to elect to postpone the effective date of coverage to 
        the date that is not more than 1 month later than the date 
        requested in the individual's application for enrollment.''.
  (e) Effective Dates.--
          (1) Application to current health insurance premium tax 
        credit.--The amendment made by subsection (a) is contingent 
        upon the enactment of the American Health Care Act of 2017 and 
        shall apply (if at all) to months beginning after December 31, 
        2017.
          (2) Application to new health insurance premium tax credit.--
        The amendment made by subsection (b) is contingent upon the 
        enactment of the American Health Care Act of 2017 and shall 
        apply (if at all) to months beginning after December 31, 2019, 
        in taxable years ending after such date.
          (3) Conforming amendment on continuous health insurance 
        coverage provision.--The amendment made by subsection (c) is 
        contingent upon the enactment of the American Health Care Act 
        of 2017 and shall take effect (if at all) as if included in 
        such Act.
          (4) Flexibility in coverage date in case of delay in 
        verification of status.--The amendment made by subsection (d) 
        is contingent upon the enactment of the American Health Care 
        Act of 2017 and shall apply (if at all) to applications for 
        advance payments for months beginning after December 31, 2017.

                       I. SUMMARY AND BACKGROUND


                         A. Purpose and Summary

    The bill, H.R. 2581, as reported by the Committee on Ways 
and Means, amends the premium tax credit under section 36B of 
the Internal Revenue Code (``Code''),\1\ to specify that 
advance payments of the credit are not to be made with respect 
to an individual unless the Secretary of the Treasury has 
confirmed with the Secretary of Health and Human Services that 
the individual's status as a citizen or national of the United 
States, or as lawfully present in the United States, has been 
verified. In addition, H.R. 2581, as reported by the Committee 
on Ways and Means, amends H.R. 1628, the American Health Care 
Act of 2017, as passed by the House of Representatives on May 
4, 2017, to provide a similar rule with respect to advance 
payments of a new credit for the purchase of health insurance 
(effective for months beginning after December 31, 2019, in 
taxable years ending after that date).
---------------------------------------------------------------------------
    \1\All section references herein are to the Internal Revenue Code 
of 1986, as amended, unless otherwise stated.
---------------------------------------------------------------------------

                 B. Background and Need for Legislation

    Under present law and the American Health Care Act of 2017, 
an individual is not eligible for the premium assistance credit 
unless the individual is a citizen or national of the United 
States, or, in the case of the presentlaw credit, 
lawfully present in the United States, or, in the case of the 
new credit under the American Health Care Act of 2017, a 
qualified alien. The procedures applicable with respect to 
advance payment of either credit require verification of the 
individual's status by the Secretary of Health and Human 
Services before advance payments of the credit are made by the 
Department of the Treasury. However, existing procedures may 
not be sufficient to ensure that proper verification has 
occurred. The bill therefore requires the Secretary of the 
Treasury to confirm such verification before making an advanced 
payment.
    On March 8, 2017, in fulfillment of the reconciliation 
instructions included in section 2002 of the Concurrent 
Resolution on the Budget for Fiscal Year 2017 (S. Con. Res. 3), 
the Committee marked up Budget Reconciliation Legislative 
Recommendations Relating to Repeal and Replace of Health-
Related Tax Policy. This submission included provisions 
modifying the determination and advanced payment of the 
refundable tax credit. However, that language was later changed 
at the Committee on Rules in order to comply with Senate 
guidance regarding the Reconciliation process.

                         C. Legislative History


Background

    H.R. 2581 was introduced on May 22, 2017, and was referred 
to the Committee on Ways and Means and the Committee on Energy 
and Commerce.

Committee action

    The Committee on Ways and Means marked up H.R. 2581, the 
Verify First Act, on May 24, 2017, and ordered the bill, as 
amended, favorably reported (with a quorum being present).

Committee hearings

    Since the 112th Congress, the Committee on Ways and Means 
and its subcommittees have held a number of hearings on health 
reform that explored various parts of the health system and 
informed policy contained in the American Health Care Act. 
These hearings include:
           March 2, 2011--Hearing on Improving Efforts 
        to Combat Health Care Fraud
           September 11, 2012--Hearing on Internal 
        Revenue Service's Implementation and Administration of 
        the Democrats' Health Care Law
           September 12, 2012--Hearing on 
        Implementation of Health Insurance Exchanges and 
        Related Provisions
           December 4, 2013--Hearing on the Challenges 
        of the Affordable Care Act
           June 10, 2014--Verification of Income and 
        Insurance Information under the Affordable Care Act
           March 14, 2016--Hearing on the Tax Treatment 
        of Health Care
           May 17, 2016--Member Day Hearing on Tax-
        Related Proposals to Improve Health Care

                      II. EXPLANATION OF THE BILL


 A. Verification of Status in United States as Condition of Receiving 
         Advance Payment of Health Insurance Premium Tax Credit


                              PRESENT LAW

Premium assistance credit

            In general
    A refundable tax credit (``premium assistance credit'') is 
provided for eligible individuals and families to subsidize the 
purchase of health insurance plans through an American Health 
Benefit Exchange (``Exchange''), referred to as ``qualified 
health plans.''\2\ In general, as discussed below, advance 
payments with respect to the premium assistance credit are made 
during the year directly to the insurer. However, eligible 
individuals may choose to pay their total health insurance 
premiums without advance payments and claim the credit at the 
end of the taxable year.
---------------------------------------------------------------------------
    \2\Sec. 36B, effective for taxable years ending after December 31, 
2013. Under the Affordable Care Act, an American Health Benefit 
Exchange is a source through which individuals can purchase health 
insurance coverage. As used herein, the Affordable Care Act (or 
``ACA'') refers to the combination of the Patient Protection and 
Affordable Care Act (``PPACA''), Pub. L. No. 111-148, and the 
Healthcare and Education Reconciliation Act of 2010 (``HCERA''), Pub. 
L. No. 111-152. Qualified health plan is defined in PPACA section 1301.
---------------------------------------------------------------------------
    The premium assistance credit is generally available for 
individuals (single or joint filers) with household incomes 
between 100 and 400 percent of the Federal poverty level 
(``FPL'') for the family size involved.\3\ Household income is 
defined as the sum of: (1) the individual's modified adjusted 
gross income, plus (2) the aggregate modified adjusted gross 
incomes of all other individuals taken into account in 
determining the individual's family size (but only if the other 
individuals are required to file a tax return for the taxable 
year). Modified adjusted gross income is defined as adjusted 
gross income increased by: (1) any amount excluded from gross 
income for citizens or residents living abroad,\4\ (2) any tax-
exempt interest received or accrued during the tax year, and 
(3) the portion of the individual's social security benefits 
not included in gross income.\5\ To be eligible for the premium 
assistance credit, individuals who are married must file a 
joint return. Individuals who are listed as dependents on a 
return are not eligible for the premium assistance credit.
---------------------------------------------------------------------------
    \3\Federal poverty level refers to the most recently published 
poverty guidelines determined by the Secretary of Health and Human 
Services. Levels for 2017 and previous years are available at https://
aspe.hhs.gov/prior-hhs-poverty-guidelines-and-federal-register-
references.
    \4\Sec. 911.
    \5\Under section 86, only a portion of an individual's social 
security benefits are included in gross income.
---------------------------------------------------------------------------
    In order to enroll in a qualified health plan through an 
Exchange and receive the premium assistance credit, an 
individual must be a citizen or national of the United States 
or an alien lawfully present in the United States.\6\
---------------------------------------------------------------------------
    \6\PPACA sec. 1312(f)(3) and sec. 36B(e)(2).
---------------------------------------------------------------------------
            Advance payments and reconciliation on tax return
    As part of the process of enrollment in a qualified health 
plan through an Exchange, an individual may apply and be 
approved for advance payments with respect to a premium 
assistance credit (``advance payments'').\7\ The individual 
must provide information on income, family size, changes in 
marital or family status or income, and U.S. citizen, national 
or lawfully present status. The Exchange process includes a 
system through which the Secretary of Health and Human Services 
(``HHS'') verifies information provided by the individual using 
information from certain Federal agencies and other sources. 
U.S. citizen, national or lawfully present status is verified 
by obtaining information from the Commissioner of Social 
Security and the Secretary of Homeland Security.\8\ If an 
individual is approved for advance payments, the Department of 
the Treasury pays the advance amount directly to the issuer of 
the health plan in which the individual is enrolled. The 
individual then pays to the issuer of the plan the difference, 
if any, between the advance payment amount and the total 
premium charged for the plan.
---------------------------------------------------------------------------
    \7\PPACA secs. 1411-1412. The Department of Health and Human 
Services is responsible for rules relating to Exchanges and the 
eligibility determination process.
    \8\PPACA sec. 1411(c)(2).
---------------------------------------------------------------------------
    An individual on whose behalf advance payments of the 
premium assistance credit for a taxable year are made is 
required to file an income tax return to reconcile the advance 
payments with the credit to which the individual is entitled 
for the taxable year.
    If the advance payments of the premium assistance credit 
exceed the amount of credit to which the individual is 
entitled, the excess (``excess advance payments'') is treated 
as an additional tax liability on the individual's income tax 
return for the taxable year (referred to as ``recapture''), 
subject to a limit on the amount of additional liability in 
some cases. For an individual with household income below 400 
percent of FPL, liability for the excess advance payments for a 
taxable year is limited to a specific dollar amount (the 
``applicable dollar amount'') as shown in the table below. One-
half of the applicable dollar amount shown in the table below 
applies to an unmarried individual who is not a surviving 
spouse or filing as a head of household.

       RECONCILIATION LIMIT ON ADDITIONAL TAX LIABILITY (FOR 2017)
------------------------------------------------------------------------
                                                              Applicable
      Household income (expressed as a percent of FPL)          dollar
                                                                amount
------------------------------------------------------------------------
Less than 200%.............................................         $600
At least 200% but less than 300%...........................        1,500
At least 300% but less than 400%...........................        2,550
------------------------------------------------------------------------

    \9\Rev. Proc. 2016-55, 2015-45 I.R.B. 707. The applicable dollar 
amounts are indexed to reflect cost-of-living increases, with the 
amount of any increase rounded down to the next lowest multiple of $50.
---------------------------------------------------------------------------
    If the advance payments of the premium assistance credit 
for a taxable year are less than the amount of the credit to 
which the individual is entitled, the additional credit amount 
is also reflected on the individual's income tax return for the 
year.

SSNs and ITINs

    An individual filing a U.S. tax return is required to state 
his or her taxpayer identification number on the return. 
Generally, a taxpayer identification number is the individual's 
Social Security number (``SSN'').\10\ However, in the case of 
an individual who is not eligible to be issued an SSN, but who 
has a tax filing obligation, the Internal Revenue Service 
issues an individual taxpayer identification number (``ITIN'') 
for use in connection with the individual's tax filing 
requirements.\11\ An individual who is eligible to receive an 
SSN may not obtain an ITIN for purposes of his or her tax 
filing obligations.\12\ An ITIN does not provide eligibility to 
work in the United States or to claim Social Security benefits.
---------------------------------------------------------------------------
    \10\Sec. 6109(a).
    \11\Treas. Reg. Sec. 301.6109-1(d)(3)(i).
    \12\Treas. Reg. Sec. 301.6109-1(d)(3)(ii).
---------------------------------------------------------------------------

                  THE AMERICAN HEALTH CARE ACT OF 2017

    The American Health Care Act of 2017, as passed by the 
House of Representatives on May 4, 2017 (the ``AHCA''), amends 
various health-related provisions of the Code.\13\ Effective 
for months beginning after December 31, 2019, in taxable years 
ending after that date, the AHCA replaces the present-law 
premium assistance credit with a new credit.\14\ Under the 
AHCA, an individual is eligible for the new premium assistance 
credit only if the individual is a citizen or national of the 
United States or a qualified alien.\15\ In connection with the 
new premium assistance credit, the AHCA amends the provisions 
relating to advance payment of the credit to direct the 
Secretary of the Treasury and the Secretary of HHS to prescribe 
such regulations as each Secretary may deem necessary to 
establish and operate the advance payment program in a manner 
that protects taxpayer information, provides robust 
verification of all information necessary to establish 
eligibility for advance payments, ensures proper and timely 
payments to appropriate health providers, and protects program 
integrity to the maximum extent feasible.\16\
---------------------------------------------------------------------------
    \13\H.R. 1628, as passed by the House of Representatives on May 4, 
2017. The AHCA also amends certain provisions of the Public Health 
Service Act (the ``PHSA''). Under present-law PHSA section 2701, 
premiums charged for health insurance purchased in the individual 
market are permitted to vary only by certain factors, such as the 
number of individuals covered by the insurance and, within limits, the 
age of the insured. This limit on premium variation is referred to as 
community rating. AHCA section 133 amends the PHSA to require an 
increase of 30 percent in the otherwise applicable premium in certain 
cases where an individual enrolling in health insurance coverage did 
not have health insurance for 63 or more consecutive days during the 
preceding 12-month period (sometimes referred to as the ``continuous 
coverage'' requirement). Under AHCA section 136, in certain cases where 
the continuous coverage requirement is not met, premiums may be based 
on the health status of the individual in lieu of the 30 percent 
premium increase.
    \14\AHCA section 214. AHCA section 201 amends the present-law 
premium assistance credit to repeal the limits on recapture of excess 
advance payments, effective for taxable years beginning after December 
31, 2017. AHCA section 202 makes other changes to the present-law 
premium assistance credit for periods before the new credit becomes 
effective.
    \15\Qualified alien is defined in section 431 of the Personal 
Responsibility and Work Opportunity Reconciliation Act of 1996 (8 
U.S.C. sec. 1641).
    \16\AHCA section 214(b), adding a new PPACA section 1412(f).
---------------------------------------------------------------------------

                           REASONS FOR CHANGE

    The Committee is concerned that the existing verification 
procedures that apply with respect to citizen, national or 
immigration status before advance payments may be made do not 
adequately ensure that only eligible individuals are approved 
for advance payments. Erroneous advance payments represent a 
misuse of taxpayer funds and contribute to Federal deficits, 
particularly when erroneous amounts cannot be fully recovered. 
The Committee therefore wishes to strengthen the procedures 
that must be followed before advance payments can be made.

                        EXPLANATION OF PROVISION

    The provision amends the present-law premium assistance 
credit to specify that no advance payments are to be made with 
respect to an individual unless the Secretary of the Treasury 
has received confirmation from the Secretary of HHS that the 
Commissioner of Social Security or the Secretary of Homeland 
Security has verified the individual's status as a citizen or 
national of the United States or an alien lawfully present in 
the United States using a process that includes the appropriate 
use of information related to citizenship or immigration 
status, such as SSNs.\17\ The provision also amends the 
provision of the AHCA relating to the new premium assistance 
credit to add a similar requirement of confirmation that an 
individual's status as a citizen or national of the United 
States or a qualified alien has been verified.\18\
---------------------------------------------------------------------------
    \17\An SSN is not the sole means by which citizenship or 
immigration status can be verified. However, under the provision, an 
ITIN cannot be used to verify citizenship or immigration status.
    \18\The bill also contains a provision that amends the continuus 
coverage requirement under AHCA section 133 so that, in the case of an 
individual for whom a determination of eligibility for advance payments 
is delayed by reason of the requirement to verify the individual's 
status under PPACA section 1411(c)(2), the period from the date of 
application for advance payments to the date of verification is 
disregarded in determining whether the individual meets the continuous 
coverage requirement (including for purposes of whether, under AHCA 
section 136, premiums can be based on the individual's health status). 
The bill further contains a provision that amends PPACA section 1411 to 
require with respect to such an individual that, if, in order for the 
individual's health coverage to be effective as of the date requested 
in the individual's application for enrollment, the individual would be 
required to pay retroactive premiums for two or more months, the 
individual must be provided the option of postponing the effective date 
of coverage for up to one month.
---------------------------------------------------------------------------

                             EFFECTIVE DATE

    The provision relating to the present-law premium 
assistance credit is contingent on the enactment of the AHCA 
and will apply (if at all) to months beginning after December 
31, 2017. The provision relating to the new premium assistance 
credit under the AHCA is contingent on the enactment of the 
AHCA and will apply (if at all) to months beginning after 
December 31, 2019, in taxable years ending after that date.\19\
---------------------------------------------------------------------------
    \19\The provision amending the continuous coverage requirement 
under AHCA section 133 is contingent on enactment of the AHCA and will 
take effect (if at all) as if included in the AHCA. The provision 
relating to the postponement of health coverage by an individual, for 
whom a determination of eligibility for advance payments is delayed by 
reason of the requirement to verify the individual's status under PPACA 
section 1411(c)(2), is contingent on enactment of the AHCA and will 
apply (if at all) to applications for advance payments for months 
beginning after December 31, 2017.
---------------------------------------------------------------------------

                      III. VOTES OF THE COMMITTEE

    In compliance with clause 3(b) of rule XIII of the Rules of 
the House of Representatives, the following statement is made 
concerning the vote of the Committee on Ways and Means in its 
consideration of H.R. 2581, the ``Verify First Act,'' on May 
24, 2017.
    The vote on the amendment by Ms. Sanchez to the amendment 
in the nature of a substitute to H.R. 2581, which would limit 
the applicability of the underlying provision, was not agreed 
to by a roll call vote of 21 nays to 16 yeas (with a quorum 
being present). The vote was as follows:

----------------------------------------------------------------------------------------------------------------
         Representative              Yea       Nay     Present    Representative       Yea       Nay     Present
----------------------------------------------------------------------------------------------------------------
Mr. Brady.......................  ........        X   ........  Mr. Neal..........        X   ........  ........
Mr. Johnson.....................  ........  ........  ........  Mr. Levin.........        X   ........  ........
Mr. Nunes.......................  ........        X   ........  Mr. Lewis.........        X   ........  ........
Mr. Tiberi......................  ........        X   ........  Mr. Doggett.......        X   ........  ........
Mr. Reichert....................  ........        X   ........  Mr. Thompson......        X   ........  ........
Mr. Roskam......................  ........  ........  ........  Mr. Larson........        X   ........  ........
Mr. Buchanan....................  ........        X   ........  Mr. Blumenauer....        X   ........  ........
Mr. Smith (NE)..................  ........        X   ........  Mr. Kind..........        X   ........  ........
Ms. Jenkins.....................  ........        X   ........  Mr. Pascrell......        X   ........  ........
Mr. Paulsen.....................  ........        X   ........  Mr. Crowley.......        X   ........  ........
Mr. Marchant....................  ........        X   ........  Mr. Davis.........        X   ........  ........
Ms. Black.......................  ........  ........  ........  Ms. Sanchez.......        X   ........  ........
Mr. Reed........................  ........        X   ........  Mr. Higgins.......        X   ........  ........
Mr. Kelly.......................  ........        X   ........  Ms. Sewell........        X   ........  ........
Mr. Renacci.....................  ........        X   ........  Ms. DelBene.......        X   ........  ........
Mr. Meehan......................  ........        X   ........  Ms. Chu...........        X   ........  ........
Ms. Noem........................  ........        X   ........
Mr. Holding.....................  ........        X   ........
Mr. Smith (MO)..................  ........        X   ........
Mr. Rice........................  ........        X   ........
Mr. Schweikert..................  ........        X   ........
Ms. Walorski....................  ........        X   ........
Mr. Curbelo.....................  ........        X   ........
Mr. Bishop......................  ........        X   ........
----------------------------------------------------------------------------------------------------------------

    Mr. Nunes's motion to table Mr. Doggett's appeal of the 
ruling of the Chair was agreed to by a roll call vote of 22 
yeas and 16 nays (with a quorum being present). The vote was as 
follows:

----------------------------------------------------------------------------------------------------------------
         Representative              Yea       Nay     Present    Representative       Yea       Nay     Present
----------------------------------------------------------------------------------------------------------------
Mr. Brady.......................        X   ........  ........  Mr. Neal..........  ........        X   ........
Mr. Johnson.....................  ........  ........  ........  Mr. Levin.........  ........        X   ........
Mr. Nunes.......................        X   ........  ........  Mr. Lewis.........  ........        X   ........
Mr. Tiberi......................        X   ........  ........  Mr. Doggett.......  ........        X   ........
Mr. Reichert....................        X   ........  ........  Mr. Thompson......  ........        X   ........
Mr. Roskam......................        X   ........  ........  Mr. Larson........  ........        X   ........
Mr. Buchanan....................        X   ........  ........  Mr. Blumenauer....  ........        X   ........
Mr. Smith (NE)..................        X   ........  ........  Mr. Kind..........  ........        X   ........
Ms. Jenkins.....................        X   ........  ........  Mr. Pascrell......  ........        X   ........
Mr. Paulsen.....................        X   ........  ........  Mr. Crowley.......  ........        X   ........
Mr. Marchant....................        X   ........  ........  Mr. Davis.........  ........        X   ........
Ms. Black.......................  ........  ........  ........  Ms. Sanchez.......  ........        X   ........
Mr. Reed........................        X   ........  ........  Mr. Higgins.......  ........        X   ........
Mr. Kelly.......................        X   ........  ........  Ms. Sewell........  ........        X   ........
Mr. Renacci.....................        X   ........  ........  Ms. DelBene.......  ........        X   ........
Mr. Meehan......................        X   ........  ........  Ms. Chu...........  ........        X   ........
Ms. Noem........................        X   ........  ........
Mr. Holding.....................        X   ........  ........
Mr. Smith (MO)..................        X   ........  ........
Mr. Rice........................        X   ........  ........
Mr. Schweikert..................        X   ........  ........
Ms. Walorski....................        X   ........  ........
Mr. Curbelo.....................        X   ........  ........
Mr. Bishop......................        X   ........  ........
----------------------------------------------------------------------------------------------------------------

    The legislation was ordered favorably transmitted to the 
House of Representatives as amended by a roll call vote of 22 
yeas and 16 nays (with a quorum being present). The vote was as 
follows:

----------------------------------------------------------------------------------------------------------------
         Representative              Yea       Nay     Present    Representative       Yea       Nay     Present
----------------------------------------------------------------------------------------------------------------
Mr. Brady.......................        X   ........  ........  Mr. Neal..........  ........        X   ........
Mr. Johnson.....................  ........  ........  ........  Mr. Levin.........  ........        X   ........
Mr. Nunes.......................        X   ........  ........  Mr. Lewis.........  ........        X   ........
Mr. Tiberi......................        X   ........  ........  Mr. Doggett.......  ........        X   ........
Mr. Reichert....................        X   ........  ........  Mr. Thompson......  ........        X   ........
Mr. Roskam......................        X   ........  ........  Mr. Larson........  ........        X   ........
Mr. Buchanan....................        X   ........  ........  Mr. Blumenauer....  ........        X   ........
Mr. Smith (NE)..................        X   ........  ........  Mr. Kind..........  ........        X   ........
Ms. Jenkins.....................        X   ........  ........  Mr. Pascrell......  ........        X   ........
Mr. Paulsen.....................        X   ........  ........  Mr. Crowley.......  ........        X   ........
Mr. Marchant....................        X   ........  ........  Mr. Davis.........  ........        X   ........
Ms. Black.......................  ........  ........  ........  Ms. Sanchez.......  ........        X   ........
Mr. Reed........................        X   ........  ........  Mr. Higgins.......  ........        X   ........
Mr. Kelly.......................        X   ........  ........  Ms. Sewell........  ........        X   ........
Mr. Renacci.....................        X   ........  ........  Ms. DelBene.......  ........        X   ........
Mr. Meehan......................        X   ........  ........  Ms. Chu...........  ........        X   ........
Ms. Noem........................        X   ........  ........
Mr. Holding.....................        X   ........  ........
Mr. Smith (MO)..................        X   ........  ........
Mr. Rice........................        X   ........  ........
Mr. Schweikert..................        X   ........  ........
Ms. Walorski....................        X   ........  ........
Mr. Curbelo.....................        X   ........  ........
Mr. Bishop......................        X   ........  ........
----------------------------------------------------------------------------------------------------------------

                     IV. BUDGET EFFECTS OF THE BILL


               A. Committee Estimate of Budgetary Effects

    In compliance with clause 3(d) of rule XIII of the Rules of 
the House of Representatives, the following statement is made 
concerning the effects on the budget of the bill, H.R. 2581, as 
reported.
    The bill, as reported, is estimated to have no effect on 
Federal fiscal year budget receipts for fiscal years 2017-2027.
    Pursuant to clause 8 of rule XIII of the Rules of the House 
of Representatives, the following statement is made by the 
Joint Committee on Taxation with respect to the provisions of 
the bill amending the Internal Revenue Code of 1986: The gross 
budgetary effect (before incorporating macroeconomic effects) 
in any fiscal year is less than 0.25 percent of the current 
projected gross domestic product of the United States for that 
fiscal year; therefore, the bill is not ``major legislation'' 
for purposes of requiring that the estimate include the 
budgetary effects of changes in economic output, employment, 
capital stock and other macroeconomic variables.

B. Statement Regarding New Budget Authority and Tax Expenditures Budget 
                               Authority

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee states that the 
bill involves no new or increased budget authority. The 
Committee further states that the revenue provisions of the 
bill do not increase or decrease tax expenditures.

      C. Cost Estimate Prepared by the Congressional Budget Office

    In compliance with clause 3(c)(3) of rule XIII of the Rules 
of the House of Representatives, requiring a cost estimate 
prepared by the CBO, the following statement by CBO is 
provided.

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, June 1, 2017.
Hon. Kevin Brady,
Chairman, Committee on Ways and Means,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 2581, the Verify 
First Act.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Mark Booth.
            Sincerely,
                                              Keith Hall, Director.
    Enclosure.

H.R. 2581--Verify First Act

    H.R. 2581 would amend the Internal Revenue Code related to 
advance payments of health-related tax credits, contingent upon 
enactment of the American Health Care Act of 2017. Under that 
contingency, H.R. 2581 would add additional verification 
procedures before the Department of Treasury could make 
payments of certain tax credits in advance to health insurers 
on behalf of enrollees. Specifically, the bill would require 
that no advance payments could be made unless the Secretary of 
the Treasury has received confirmation from the Secretary of 
Health and Human Services that either the Commissioner of 
Social Security or the Secretary of Homeland Security has 
verified the individual's status either as a U.S. citizen or 
national or as an alien lawfully present in the country. The 
verification process would need to include information related 
to citizenship or immigration status, such as Social Security 
numbers. The requirements would apply through 2017 to the 
premium assistance credits that exist under current law and 
after 2017 to the new credits that would be established by 
enactment of the American Health Care Act of 2017.
    Because the effects of the bill would be contingent upon 
enactment of subsequent legislation, the staff of the Joint 
Committee on Taxation estimates that the bill would in 
isolation have no effect on revenues or direct spending 
relative to current law. As a result, pay-as-you-go procedures 
do not apply. However, if the American Health Care Act of 2017 
was enacted prior to this legislation, then relative to the new 
law the enactment of this bill could affect revenues or direct 
spending and, as a result, subsequent estimates of the effects 
of this legislation could change.
    CBO and JCT estimate that enacting the bill would not 
increase on-budget deficits or net direct spending by more than 
$5 billion in any of the four 10-year periods beginning in 
2028.
    JCT has determined that the bill contains no 
intergovernmental or private-sector mandates as defined in the 
Unfunded Mandates Reform Act.
    The CBO staff contact for this estimate is Mark Booth. The 
estimate was approved by John McClelland, Assistant Director 
for Tax Analysis.

     V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE


          A. Committee Oversight Findings and Recommendations

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee advises that the 
findings and recommendations of the Committee, based on 
oversight activities under clause 2(b)(1) of rule X of the 
Rules of the House of Representatives, are incorporated into 
the description portions of this report.

        B. Statement of General Performance Goals and Objectives

    With respect to clause 3(c)(4) of rule XIII of the Rules of 
the House of Representatives, the Committee advises that the 
bill contains no measure that authorizes funding, so no 
statement of general performance goals and objectives for which 
any measure authorizes funding is required.

              C. Information Relating to Unfunded Mandates

    This information is provided in accordance with section 423 
of the Unfunded Mandates Reform Act of 1995 (Pub. L. No. 104-
4).
    The Committee has determined that the bill does not contain 
Federal mandates on the private sector. The Committee has 
determined that the bill does not impose a Federal 
intergovernmental mandate on State, local, or tribal 
governments.

                D. Applicability of House Rule XXI 5(b)

    Rule XXI 5(b) of the Rules of the House of Representatives 
provides, in part, that ``A bill or joint resolution, 
amendment, or conference report carrying a Federal income tax 
rate increase may not be considered as passed or agreed to 
unless so determined by a vote of not less than three-fifths of 
the Members voting, a quorum being present.'' The Committee has 
carefully reviewed the bill and states that the bill does not 
involve any Federal income tax rate increases within the 
meaning of the rule.

                       E. Tax Complexity Analysis

    Section 4022(b) of the Internal Revenue Service 
Restructuring and Reform Act of 1998 (``IRS Reform Act'') 
requires the staff of the Joint Committee on Taxation (in 
consultation with the Internal Revenue Service and the Treasury 
Department) to provide a tax complexity analysis. The 
complexity analysis is required for all legislation reported by 
the Senate Committee on Finance, the House Committee on Ways 
and Means, or any committee of conference if the legislation 
includes a provision that directly or indirectly amends the 
Internal Revenue Code of 1986 and has widespread applicability 
to individuals or small businesses.
    Pursuant to clause 3(h)(1) of rule XIII of the Rules of the 
House of Representatives, the staff of the Joint Committee on 
Taxation has determined that a complexity analysis is not 
required under section 4022(b) of the IRS Reform Act because 
the bill contains no provisions that amend the Internal Revenue 
Code of 1986 and that have ``widespread applicability'' to 
individuals or small businesses, within the meaning of the 
rule.

  F. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff 
                                Benefits

    With respect to clause 9 of rule XXI of the Rules of the 
House of Representatives, the Committee has carefully reviewed 
the provisions of the bill and states that the provisions of 
the bill do not contain any congressional earmarks, limited tax 
benefits, or limited tariff benefits within the meaning of the 
rule.

                   G. Duplication of Federal Programs

    In compliance with Sec. 3(c)(5) of rule XIII of the Rules 
of the House of Representatives, the Committee states that no 
provision of the bill establishes or reauthorizes: (1) a 
program of the Federal Government known to be duplicative of 
another Federal program, (2) a program included in any report 
from the Government Accountability Office to Congress pursuant 
to section 21 of Public Law 111-139, or (3) a program related 
to a program identified in the most recent Catalog of Federal 
Domestic Assistance, published pursuant to section 6104 of 
title 31, United States Code.

                 H. Disclosure of Directed Rule Makings

    In compliance with Sec. 3(i) of H. Res. 5 (115th Congress), 
the following statement is made concerning directed rule 
makings: The Committee advises that the bill requires no 
directed rule makings within the meaning of such section.

       VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

    In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, and existing law in which no 
change is proposed is shown in roman):

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, and existing law in which no 
change is proposed is shown in roman):

INTERNAL REVENUE CODE OF 1986

           *       *       *       *       *       *       *



Subtitle A--Income Taxes

           *       *       *       *       *       *       *


CHAPTER 1--NORMAL TAXES AND SURTAXES

           *       *       *       *       *       *       *


Subchapter A--Determination of Tax Liability

           *       *       *       *       *       *       *


PART IV--CREDITS AGAINST TAX

           *       *       *       *       *       *       *



Subpart C--Refundable Credits

           *       *       *       *       *       *       *


[The following shows proposed changes to current law section 
36B of the Internal Revenue Code of 1986:]

SEC. 36B. REFUNDABLE CREDIT FOR COVERAGE UNDER A QUALIFIED HEALTH PLAN.

  (a) In General.--In the case of an applicable taxpayer, there 
shall be allowed as a credit against the tax imposed by this 
subtitle for any taxable year an amount equal to the premium 
assistance credit amount of the taxpayer for the taxable year.
  (b) Premium Assistance Credit Amount.--For purposes of this 
section--
          (1) In general.--The term ``premium assistance credit 
        amount'' means, with respect to any taxable year, the 
        sum of the premium assistance amounts determined under 
        paragraph (2) with respect to all coverage months of 
        the taxpayer occurring during the taxable year.
          (2) Premium assistance amount.--The premium 
        assistance amount determined under this subsection with 
        respect to any coverage month is the amount equal to 
        the lesser of--
                  (A) the monthly premiums for such month for 1 
                or more qualified health plans offered in the 
                individual market within a State which cover 
                the taxpayer, the taxpayer's spouse, or any 
                dependent (as defined in section 152) of the 
                taxpayer and which were enrolled in through an 
                Exchange established by the State under 1311 of 
                the Patient Protection and Affordable Care Act, 
                or
                  (B) the excess (if any) of--
                          (i) the adjusted monthly premium for 
                        such month for the applicable second 
                        lowest cost silver plan with respect to 
                        the taxpayer, over
                          (ii) an amount equal to 1/12 of the 
                        product of the applicable percentage 
                        and the taxpayer's household income for 
                        the taxable year.
          (3) Other terms and rules relating to premium 
        assistance amounts.--For purposes of paragraph (2)--
                  (A) Applicable percentage.--
                          (i) In general.--Except as provided 
                        in clause (ii), 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 premium percentage to the final 
                        premium percentage specified in such 
                        table for such income tier:


 
------------------------------------------------------------------------
     In the case of
    household income
(expressed as a percent    The initial premium       The final premium
of poverty line) within      percentage is--          percentage is--
  the following income
         tier:
------------------------------------------------------------------------
Up to 133%               2.0%                     2.0%
133% up to 150%          3.0%                     4.0%
150% up to 200%          4.0%                     6.3%
200% up to 250%          6.3%                     8.05%
250% up to 300%          8.05%                    9.5%
300% up to 400%          9.5%                     9.5%
------------------------------------------------------------------------

                          (ii) Indexing.--
                                  (I) In general.--Subject to 
                                subclause (II), in the case of 
                                taxable years beginning in any 
                                calendar year after 2014, the 
                                initial and final applicable 
                                percentages under clause (i) 
                                (as in effect for the preceding 
                                calendar year after application 
                                of this clause) shall be 
                                adjusted to reflect the excess 
                                of the rate of premium growth 
                                for the preceding calendar year 
                                over the rate of income growth 
                                for the preceding calendar 
                                year.
                                  (II) Additional adjustment.--
                                Except as provided in subclause 
                                (III), in the case of any 
                                calendar year after 2018, the 
                                percentages described in 
                                subclause (I) shall, in 
                                addition to the adjustment 
                                under subclause (I), be 
                                adjusted to reflect the excess 
                                (if any) of the rate of premium 
                                growth estimated under 
                                subclause (I) for the preceding 
                                calendar year over the rate of 
                                growth in the consumer price 
                                index for the preceding 
                                calendar year.
                                  (III) Failsafe.--Subclause 
                                (II) shall apply for any 
                                calendar year 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 the preceding calendar 
                                year exceeds an amount equal to 
                                0.504 percent of the gross 
                                domestic product for the 
                                preceding calendar year.
                  (B) Applicable second lowest cost silver 
                plan.--The applicable second lowest cost silver 
                plan with respect to any applicable taxpayer is 
                the second lowest cost silver plan of the 
                individual market in the rating area in which 
                the taxpayer resides which--
                          (i) is offered through the same 
                        Exchange through which the qualified 
                        health plans taken into account under 
                        paragraph (2)(A) were offered, and
                          (ii) provides--
                                  (I) self-only coverage in the 
                                case of an applicable 
                                taxpayer--
                                          (aa) whose tax for 
                                        the taxable year is 
                                        determined under 
                                        section 1(c) (relating 
                                        to unmarried 
                                        individuals other than 
                                        surviving spouses and 
                                        heads of households) 
                                        and who is not allowed 
                                        a deduction under 
                                        section 151 for the 
                                        taxable year with 
                                        respect to a dependent, 
                                        or
                                          (bb) who is not 
                                        described in item (aa) 
                                        but who purchases only 
                                        self-only coverage, and
                                  (II) family coverage in the 
                                case of any other applicable 
                                taxpayer.
                If a taxpayer files a joint return and no 
                credit is allowed under this section with 
                respect to 1 of the spouses by reason of 
                subsection (e), the taxpayer shall be treated 
                as described in clause (ii)(I) unless a 
                deduction is allowed under section 151 for the 
                taxable year with respect to a dependent other 
                than either spouse and subsection (e) does not 
                apply to the dependent.
                  (C) Adjusted monthly premium.--The adjusted 
                monthly premium for an applicable second lowest 
                cost silver plan is the monthly premium which 
                would have been charged (for the rating area 
                with respect to which the premiums under 
                paragraph (2)(A) were determined) for the plan 
                if each individual covered under a qualified 
                health plan taken into account under paragraph 
                (2)(A) were covered by such silver plan and the 
                premium was adjusted only for the age of each 
                such individual in the manner allowed under 
                section 2701 of the Public Health Service Act. 
                In the case of a State participating in the 
                wellness discount demonstration project under 
                section 2705(d) of the Public Health Service 
                Act, the adjusted monthly premium shall be 
                determined without regard to any premium 
                discount or rebate under such project.
                  (D) Additional benefits.--If--
                          (i) a qualified health plan under 
                        section 1302(b)(5) of the Patient 
                        Protection and Affordable Care Act 
                        offers benefits in addition to the 
                        essential health benefits required to 
                        be provided by the plan, or
                          (ii) a State requires a qualified 
                        health plan under section 1311(d)(3)(B) 
                        of such Act to cover benefits in 
                        addition to the essential health 
                        benefits required to be provided by the 
                        plan,
                the portion of the premium for the plan 
                properly allocable (under rules prescribed by 
                the Secretary of Health and Human Services) to 
                such additional benefits shall not be taken 
                into account in determining either the monthly 
                premium or the adjusted monthly premium under 
                paragraph (2).
                  (E) Special rule for pediatric dental 
                coverage.--For purposes of determining the 
                amount of any monthly premium, if an individual 
                enrolls in both a qualified health plan and a 
                plan described in section 1311(d)(2)(B)(ii) (I) 
                of the Patient Protection and Affordable Care 
                Act for any plan year, the portion of the 
                premium for the plan described in such section 
                that (under regulations prescribed by the 
                Secretary) is properly allocable to pediatric 
                dental benefits which are included in the 
                essential health benefits required to be 
                provided by a qualified health plan under 
                section 1302(b)(1)(J) of such Act shall be 
                treated as a premium payable for a qualified 
                health plan.
  (c) Definition and Rules Relating to Applicable Taxpayers, 
Coverage Months, and Qualified Health Plan.--For purposes of 
this section--
          (1) Applicable taxpayer.--
                  (A) In general.--The term ``applicable 
                taxpayer'' means, with respect to any taxable 
                year, a taxpayer whose household income for the 
                taxable year equals or exceeds 100 percent but 
                does not exceed 400 percent of an amount equal 
                to the poverty line for a family of the size 
                involved.
                  (B) Special rule for certain individuals 
                lawfully present in the United States.--If--
                          (i) a taxpayer has a household income 
                        which is not greater than 100 percent 
                        of an amount equal to the poverty line 
                        for a family of the size involved, and
                          (ii) the taxpayer is an alien 
                        lawfully present in the United States, 
                        but is not eligible for the medicaid 
                        program under title XIX of the Social 
                        Security Act by reason of such alien 
                        status,
                the taxpayer shall, for purposes of the credit 
                under this section, be treated as an applicable 
                taxpayer with a household income which is equal 
                to 100 percent of the poverty line for a family 
                of the size involved.
                  (C) Married couples must file joint return.--
                If the taxpayer is married (within the meaning 
                of section 7703) at the close of the taxable 
                year, the taxpayer shall be treated as an 
                applicable taxpayer only if the taxpayer and 
                the taxpayer's spouse file a joint return for 
                the taxable year.
                  (D) Denial of credit to dependents.--No 
                credit shall be allowed under this section to 
                any individual with respect to whom a deduction 
                under section 151 is allowable to another 
                taxpayer for a taxable year beginning in the 
                calendar year in which such individual's 
                taxable year begins.
          (2) Coverage month.--For purposes of this 
        subsection--
                  (A) In general.--The term ``coverage month'' 
                means, with respect to an applicable taxpayer, 
                any month if--
                          (i) as of the first day of such month 
                        the taxpayer, the taxpayer's spouse, or 
                        any dependent of the taxpayer is 
                        covered by a qualified health plan 
                        described in subsection (b)(2)(A) that 
                        was enrolled in through an Exchange 
                        established by the State under section 
                        1311 of the Patient Protection and 
                        Affordable Care Act, and
                          (ii) the premium for coverage under 
                        such plan for such month is paid by the 
                        taxpayer (or through advance payment of 
                        the credit under subsection (a) under 
                        section 1412 of the Patient Protection 
                        and Affordable Care Act).
                  (B) Exception for minimum essential 
                coverage.--
                          (i) In general.--The term ``coverage 
                        month'' shall not include any month 
                        with respect to an individual if for 
                        such month the individual is eligible 
                        for minimum essential coverage other 
                        than eligibility for coverage described 
                        in section 5000A(f)(1)(C) (relating to 
                        coverage in the individual market).
                          (ii) Minimum essential coverage.--The 
                        term ``minimum essential coverage'' has 
                        the meaning given such term by section 
                        5000A(f).
                  (C) Special rule for employer-sponsored 
                minimum essential coverage.--For purposes of 
                subparagraph (B)--
                          (i) Coverage must be affordable.--
                        Except as provided in clause (iii), an 
                        employee shall not be treated as 
                        eligible for minimum essential coverage 
                        if such coverage--
                                  (I) consists of an eligible 
                                employer-sponsored plan (as 
                                defined in section 
                                5000A(f)(2)), and
                                  (II) the employee's required 
                                contribution (within the 
                                meaning of section 
                                5000A(e)(1)(B)) with respect to 
                                the plan exceeds 9.5 percent of 
                                the applicable taxpayer's 
                                household income.
                        This clause shall also apply to an 
                        individual who is eligible to enroll in 
                        the plan by reason of a relationship 
                        the individual bears to the employee.
                          (ii) Coverage must provide minimum 
                        value.--Except as provided in clause 
                        (iii), an employee shall not be treated 
                        as eligible for minimum essential 
                        coverage if such coverage consists of 
                        an eligible employer-sponsored plan (as 
                        defined in section 5000A(f)(2)) and the 
                        plan's share of the total allowed costs 
                        of benefits provided under the plan is 
                        less than 60 percent of such costs.
                          (iii) Employee or family must not be 
                        covered under employer plan.--Clauses 
                        (i) and (ii) shall not apply if the 
                        employee (or any individual described 
                        in the last sentence of clause (i)) is 
                        covered under the eligible employer-
                        sponsored plan or the grandfathered 
                        health plan.
                          (iv) Indexing.--In the case of plan 
                        years beginning in any calendar year 
                        after 2014, the Secretary shall adjust 
                        the 9.5 percent under clause (i)(II) in 
                        the same manner as the percentages are 
                        adjusted under subsection 
                        (b)(3)(A)(ii).
          (3) Definitions and other rules.--
                  (A) Qualified health plan.--The term 
                ``qualified health plan'' has the meaning given 
                such term by section 1301(a) of the Patient 
                Protection and Affordable Care Act, except that 
                such term shall not include a qualified health 
                plan which is a catastrophic plan described in 
                section 1302(e) of such Act.
                  (B) Grandfathered health plan.--The term 
                ``grandfathered health plan'' has the meaning 
                given such term by section 1251 of the Patient 
                Protection and Affordable Care Act.
          (4) Special rules for qualified small employer health 
        reimbursement arrangements.--
                  (A) In general.--The term ``coverage month'' 
                shall not include any month with respect to an 
                employee (or any spouse or dependent of such 
                employee) if for such month the employee is 
                provided a qualified small employer health 
                reimbursement arrangement which constitutes 
                affordable coverage.
                  (B) Denial of double benefit.--In the case of 
                any employee who is provided a qualified small 
                employer health reimbursement arrangement for 
                any coverage month (determined without regard 
                to subparagraph (A)), the credit otherwise 
                allowable under subsection (a) to the taxpayer 
                for such month shall be reduced (but not below 
                zero) by the amount described in subparagraph 
                (C)(i)(II) for such month.
                  (C) Affordable coverage.--For purposes of 
                subparagraph (A), a qualified small employer 
                health reimbursement arrangement shall be 
                treated as constituting affordable coverage for 
                a month if--
                          (i) the excess of--
                                  (I) the amount that would be 
                                paid by the employee as the 
                                premium for such month for 
                                self-only coverage under the 
                                second lowest cost silver plan 
                                offered in the relevant 
                                individual health insurance 
                                market, over
                                  (II) \1/12\ of the employee's 
                                permitted benefit (as defined 
                                in section 9831(d)(3)(C)) under 
                                such arrangement, does not 
                                exceed--
                          (ii) \1/12\ of 9.5 percent of the 
                        employee's household income.
                  (D) 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).
                  (E) 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 (C)(i)(II) shall be applied by 
                substituting "the number of months during the 
                year for which such arrangement was provided" 
                for "12'.
                  (F) Indexing.--In the case of plan years 
                beginning in any calendar year after 2014, the 
                Secretary shall adjust the 9.5 percent amount 
                under subparagraph (C)(ii) in the same manner 
                as the percentages are adjusted under 
                subsection (b)(3)(A)(ii).
  (d) Terms Relating to Income and Families.--For purposes of 
this section--
          (1) Family size.--The family size involved with 
        respect to any taxpayer shall be equal to the number of 
        individuals for whom the taxpayer is allowed a 
        deduction under section 151 (relating to allowance of 
        deduction for personal exemptions) for the taxable 
        year.
          (2) Household income.--
                  (A) Household income.--The term ``household 
                income'' means, with respect to any taxpayer, 
                an amount equal to the sum of--
                          (i) the modified adjusted gross 
                        income of the taxpayer, plus
                          (ii) the aggregate modified adjusted 
                        gross incomes of all other individuals 
                        who--
                                  (I) were taken into account 
                                in determining the taxpayer's 
                                family size under paragraph 
                                (1), and
                                  (II) were required to file a 
                                return of tax imposed by 
                                section 1 for the taxable year.
                  (B) Modified adjusted gross income.--The term 
                ``modified adjusted gross income'' means 
                adjusted gross income increased by--
                          (i) any amount excluded from gross 
                        income under section 911,
                          (ii) any amount of interest received 
                        or accrued by the taxpayer during the 
                        taxable year which is exempt from tax, 
                        and
                          (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.
          (3) Poverty line.--
                  (A) In general.--The term ``poverty line'' 
                has the meaning given that term in section 
                2110(c)(5) of the Social Security Act (42 
                U.S.C. 1397jj(c)(5)).
                  (B) Poverty line used.--In the case of any 
                qualified health plan offered through an 
                Exchange for coverage during a taxable year 
                beginning in a calendar year, the poverty line 
                used shall be the most recently published 
                poverty line as of the 1st day of the regular 
                enrollment period for coverage during such 
                calendar year.
  (e) Rules for Individuals Not Lawfully Present.--
          (1) In general.--If 1 or more individuals for whom a 
        taxpayer is allowed a deduction under section 151 
        (relating to allowance of deduction for personal 
        exemptions) for the taxable year (including the 
        taxpayer or his spouse) are individuals who are not 
        lawfully present--
                  (A) the aggregate amount of premiums 
                otherwise taken into account under clauses (i) 
                and (ii) of subsection (b)(2)(A) shall be 
                reduced by the portion (if any) of such 
                premiums which is attributable to such 
                individuals, and
                  (B) for purposes of applying this section, 
                the determination as to what percentage a 
                taxpayer's household income bears to the 
                poverty level for a family of the size involved 
                shall be made under one of the following 
                methods:
                          (i) A method under which--
                                  (I) the taxpayer's family 
                                size is determined by not 
                                taking such individuals into 
                                account, and
                                  (II) the taxpayer's household 
                                income is equal to the product 
                                of the taxpayer's household 
                                income (determined without 
                                regard to this subsection) and 
                                a fraction--
                                          (aa) the numerator of 
                                        which is the poverty 
                                        line for the taxpayer's 
                                        family size determined 
                                        after application of 
                                        subclause (I), and
                                          (bb) the denominator 
                                        of which is the poverty 
                                        line for the taxpayer's 
                                        family size determined 
                                        without regard to 
                                        subclause (I).
                          (ii) A comparable method reaching the 
                        same result as the method under clause 
                        (i).
          (2) Lawfully present.--For purposes of this section, 
        an individual shall be treated as lawfully present only 
        if the individual is, and is reasonably expected to be 
        for the entire period of enrollment for which the 
        credit under this section is being claimed, a citizen 
        or national of the United States or an alien lawfully 
        present in the United States.
          (3) Secretarial authority.--The Secretary of Health 
        and Human Services, in consultation with the Secretary, 
        shall prescribe rules setting forth the methods by 
        which calculations of family size and household income 
        are made for purposes of this subsection. Such rules 
        shall be designed to ensure that the least burden is 
        placed on individuals enrolling in qualified health 
        plans through an Exchange and taxpayers eligible for 
        the credit allowable under this section.
  (f) Reconciliation of Credit and Advance Credit.--
          (1) In general.--The amount of the credit allowed 
        under this section for any taxable year shall be 
        reduced (but not below zero) by the amount of any 
        advance payment of such credit under section 1412 of 
        the Patient Protection and Affordable Care Act.
          (2) Excess advance payments.--
                  (A) In general.--If the advance payments to a 
                taxpayer under section 1412 of the Patient 
                Protection and Affordable Care Act for a 
                taxable year exceed the credit allowed by this 
                section (determined without regard to paragraph 
                (1)), the tax imposed by this chapter for the 
                taxable year shall be increased by the amount 
                of such excess.
                  (B) Limitation on increase.--
                          (i) In general.--In the case of a 
                        taxpayer whose household income is less 
                        than 400 percent of the poverty line 
                        for the size of the family involved for 
                        the taxable year, the amount of the 
                        increase under subparagraph (A) shall 
                        in no event exceed the applicable 
                        dollar amount determined in accordance 
                        with the following table (one-half of 
                        such amount in the case of a taxpayer 
                        whose tax is determined under section 
                        1(c) for the taxable year):


 
------------------------------------------------------------------------
 If the household income (expressed
 as a percent of poverty line) is:     The applicable dollar amount is:
------------------------------------------------------------------------
Less than 200%                       $600
At least 200% but less than 300%     $1,500
At least 300% but less than 400%     $2,500
------------------------------------------------------------------------

                          (ii) Indexing of amount.--In the case 
                        of any calendar year beginning after 
                        2014, each of the dollar amounts in the 
                        table contained under clause (i) shall 
                        be increased by an amount equal to--
                                  (I) such dollar amount, 
                                multiplied by
                                  (II) the cost-of-living 
                                adjustment determined under 
                                section 1(f)(3) for the 
                                calendar year, determined by 
                                substituting ``calendar year 
                                2013'' for ``calendar year 
                                1992'' in subparagraph (B) 
                                thereof.
                        If the amount of any increase under 
                        clause (i) is not a multiple of $50, 
                        such increase shall be rounded to the 
                        next lowest multiple of $50.
          (3) Information requirement.--Each Exchange (or any 
        person carrying out 1 or more responsibilities of an 
        Exchange under section 1311(f)(3) or 1321(c) of the 
        Patient Protection and Affordable Care Act) shall 
        provide the following information to the Secretary and 
        to the taxpayer with respect to any health plan 
        provided through the Exchange:
                  (A) The level of coverage described in 
                section 1302(d) of the Patient Protection and 
                Affordable Care Act and the period such 
                coverage was in effect.
                  (B) The total premium for the coverage 
                without regard to the credit under this section 
                or cost-sharing reductions under section 1402 
                of such Act.
                  (C) The aggregate amount of any advance 
                payment of such credit or reductions under 
                section 1412 of such Act.
                  (D) The name, address, and TIN of the primary 
                insured and the name and TIN of each other 
                individual obtaining coverage under the policy.
                  (E) Any information provided to the Exchange, 
                including any change of circumstances, 
                necessary to determine eligibility for, and the 
                amount of, such credit.
                  (F) Information necessary to determine 
                whether a taxpayer has received excess advance 
                payments.
  (g) Verification of Status in United States for Advance 
Payment.--No advance payment of the credit allowed under this 
section with respect to any premium under subsection (b)(2)(A) 
with respect to any individual shall be made under section 1412 
of the Patient Protection and Affordable Care Act unless the 
Secretary has received confirmation from the Secretary of 
Health and Human Services that the Commissioner of Social 
Security or the Secretary of Homeland Security has verified 
under section 1411(c)(2) of such Act the individual's status as 
a citizen or national of the United States or an alien lawfully 
present in the United States using a process that includes the 
appropriate use of information related to citizenship or 
immigration status, such as social security account numbers 
(but not individual taxpayer identification numbers).
  [(g)] (h) Regulations.--The Secretary shall prescribe such 
regulations as may be necessary to carry out the provisions of 
this section, including regulations which provide for--
          (1) the coordination of the credit allowed under this 
        section with the program for advance payment of the 
        credit under section 1412 of the Patient Protection and 
        Affordable Care Act, and
          (2) the application of subsection (f) where the 
        filing status of the taxpayer for a taxable year is 
        different from such status used for determining the 
        advance payment of the credit.
[The following shows proposed changes to section 36B of the 
Internal Revenue Code of 1986 as such section is proposed to 
read after amendment by section 214 of the American Health Care 
Act of 2017 (H.R. 1628, as engrossed in the House):]

SEC. 36B. REFUNDABLE CREDIT FOR COVERAGE UNDER A QUALIFIED HEALTH PLAN.

  (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.
  (b) Monthly Credit Amounts.--
          (1) In general.--The monthly credit amount with 
        respect to any taxpayer for any calendar month is the 
        lesser of--
                  (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
                  (B) the amount paid for a qualified health 
                plan for the taxpayer and the taxpayer's 
                qualifying family members for such month.
          (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.
  (c) Monthly Limitation Amounts.--
          (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--
                  (A) $2,000 in the case of an individual who 
                has not attained age 30 as of the beginning of 
                such taxable year,
                  (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,
                  (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,
                  (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
                  (E) $4,000 in the case of an individual who 
                has attained age 60 as of such time.
          (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--
                  (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
                  (B) $75,000 (twice such amount in the case of 
                a joint return).
          (3) Other limitations.--
                  (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.
                  (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.
  (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:
          (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).
          (2) The individual is not eligible for--
                  (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
                  (B) coverage described in section 
                5000A(f)(1)(A).
          (3) The individual is either--
                  (A) a citizen or national of the United 
                States, or
                  (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)).
          (4) The individual is not incarcerated, other than 
        incarceration pending the disposition of charges.
  (e) Qualifying Family Member.--For purposes of this section, 
the term ``qualifying family member'' means--
          (1) in the case of a joint return, the taxpayer's 
        spouse,
          (2) any dependent of the taxpayer, and
          (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).
  (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--
          (1) such coverage is offered in the individual health 
        insurance market within a State (within the meaning of 
        section 5000A(f)(1)(C)),
          (2) substantially all of such coverage is not of 
        excepted benefits described in section 9832(c),
          (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),
          (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
          (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).
  (g) Special Rules.--
          (1) Married couples must file joint return.--
                  (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.
                  (B) Exception for certain taxpayers.--
                Subparagraph (A) shall not apply to any married 
                taxpayer who--
                          (i) is living apart from the 
                        taxpayer's spouse at the time the 
                        taxpayer files the tax return,
                          (ii) is unable to file a joint return 
                        because such taxpayer is a victim of 
                        domestic abuse or spousal abandonment,
                          (iii) certifies on the tax return 
                        that such taxpayer meets the 
                        requirements of clauses (i) and (ii), 
                        and
                          (iv) has not met the requirements of 
                        clauses (i), (ii), and (iii) for each 
                        of the 3 preceding taxable years.
          (2) Denial of credit to dependents.--
                  (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.
                  (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.
          (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.
          (4) Coordination with advance payments of credit.--
        With respect to any taxable year--
                  (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
                  (B) the tax imposed by section 1 for such 
                taxable year shall be increased by the excess 
                (if any) of--
                          (i) the aggregate amount paid on 
                        behalf of such taxpayer under such 
                        section 1412 for months beginning in 
                        such taxable year, over
                          (ii) the amount which would (but for 
                        this subsection) be allowed as a credit 
                        to the taxpayer under subsection (a).
          (5) Special rules for qualified small employer health 
        reimbursement arrangements.--
                  (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.
                  (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).
                  (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''.
          (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).
          (7) Inflation adjustment.--
                  (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--
                          (i) such dollar amount, multiplied by
                          (ii) the cost-of-living adjustment 
                        determined under section 1(f)(3) for 
                        the calendar year in which the taxable 
                        year begins, determined--
                                  (I) by substituting 
                                ``calendar year 2019'' for 
                                ``calendar year 1992'' in 
                                subparagraph (B) thereof, and
                                  (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.
                  (B) Terms related to CPI.--
                          (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.
                          (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.
                  (C) Rounding.--Any increase determined under 
                subparagraph (A) shall be rounded to the 
                nearest multiple of $50.
          (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.
          (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.
  (h) Verification of Status in United States for Advance 
Payment.--No advance payment of the credit allowed under this 
section with respect to any amount under subparagraph (A) or 
(B) of subsection (b)(1) with respect to any individual shall 
be made under section 1412 of the Patient Protection and 
Affordable Care Act unless the Secretary has received 
confirmation from the Secretary of Health and Human Services 
that the Commissioner of Social Security or the Secretary of 
Homeland Security has verified under section 1411(c)(2) of such 
Act the individual's status as a citizen or national of the 
United States or 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)) using a process 
that includes the appropriate use of information related to 
citizenship or immigration status, such as social security 
account numbers (but not individual taxpayer identification 
numbers).

           *       *       *       *       *       *       *

                              ----------                              


             SECTION 2710A OF THE PUBLIC HEALTH SERVICE ACT

[The following shows proposed changes to section 2710A of the 
Public Health Service Act as such section is proposed to read 
after amendment by section 133 of the American Health Care Act 
of 2017 (H.R. 1628, as engrossed in the House):]

SEC. 2710A. ENCOURAGING CONTINUOUS HEALTH INSURANCE COVERAGE.

  (a) Penalty Applied.--
          (1) In general.--Subject to the succeeding provisions 
        of this section, a health insurance issuer offering 
        health insurance coverage in the individual 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;
                  (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 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.
        In the case of an individual who applies for advance 
        payment of a credit under section 1412 of the Patient 
        Protection and Affordable Care Act and for whom a 
        determination of eligibility for such advance payment 
        is delayed by reason of the requirement for 
        verification of the individual's status in the United 
        States under section 1411(c)(2) of such Act, the period 
        of days beginning with the date of application for 
        advance payment and ending with the date of such 
        verification shall not be taken into account in 
        applying subparagraph (B). The Secretary shall 
        establish a procedure by which information relating to 
        this period is provided to the individual.
          (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.

           *       *       *       *       *       *       *

                              ----------                              


PATIENT PROTECTION AND AFFORDABLE CARE ACT

           *       *       *       *       *       *       *


TITLE I--QUALITY, AFFORDABLE HEALTH CARE FOR ALL AMERICANS

           *       *       *       *       *       *       *


       Subtitle E--Affordable Coverage Choices for All Americans

PART I--PREMIUM TAX CREDITS AND COST-SHARING REDUCTIONS

           *       *       *       *       *       *       *


                 Subpart B--Eligibility Determinations

[The following shows proposed changes to current law section 
1411 of the Patient Protection and Affordable Care Act:]

SEC. 1411. PROCEDURES FOR DETERMINING ELIGIBILITY FOR EXCHANGE 
                    PARTICIPATION, PREMIUM TAX CREDITS AND REDUCED 
                    COST-SHARING, AND INDIVIDUAL RESPONSIBILITY 
                    EXEMPTIONS.

  (a) Establishment of Program.--The Secretary shall establish 
a program meeting the requirements of this section for 
determining--
          (1) whether an individual who is to be covered in the 
        individual market by a qualified health plan offered 
        through an Exchange, or who is claiming a premium tax 
        credit or reduced cost-sharing, meets the requirements 
        of sections 1312(f)(3), 1402(e), and 1412(d) of this 
        title and section 36B(e) of the Internal Revenue Code 
        of 1986 that the individual be a citizen or national of 
        the United States or an alien lawfully present in the 
        United States;
          (2) in the case of an individual claiming a premium 
        tax credit or reduced cost-sharing under section 36B of 
        such Code or section 1402--
                  (A) whether the individual meets the income 
                and coverage requirements of such sections; and
                  (B) the amount of the tax credit or reduced 
                cost-sharing;
          (3) whether an individual's coverage under an 
        employer-sponsored health benefits plan is treated as 
        unaffordable under sections 36B(c)(2)(C) and 
        5000A(e)(2); and
          (4) whether to grant a certification under section 
        1311(d)(4)(H) attesting that, for purposes of the 
        individual responsibility requirement under section 
        5000A of the Internal Revenue Code of 1986, an 
        individual is entitled to an exemption from either the 
        individual responsibility requirement or the penalty 
        imposed by such section.
  (b) Information Required To Be Provided by Applicants.--
          (1) In general.--An applicant for enrollment in a 
        qualified health plan offered through an Exchange in 
        the individual market shall provide--
                  (A) the name, address, and date of birth of 
                each individual who is to be covered by the 
                plan (in this subsection referred to as an 
                ``enrollee''); and
                  (B) the information required by any of the 
                following paragraphs that is applicable to an 
                enrollee.
          (2) Citizenship or immigration status.--The following 
        information shall be provided with respect to every 
        enrollee:
                  (A) In the case of an enrollee whose 
                eligibility is based on an attestation of 
                citizenship of the enrollee, the enrollee's 
                social security number.
                  (B) In the case of an individual whose 
                eligibility is based on an attestation of the 
                enrollee's immigration status, the enrollee's 
                social security number (if applicable) and such 
                identifying information with respect to the 
                enrollee's immigration status as the Secretary, 
                after consultation with the Secretary of 
                Homeland Security, determines appropriate.
          (3) Eligibility and amount of tax credit or reduced 
        cost-sharing.--In the case of an enrollee with respect 
        to whom a premium tax credit or reduced cost-sharing 
        under section 36B of such Code or section 1402 is being 
        claimed, the following information:
                  (A) Information regarding income and family 
                size.--The information described in section 
                6103(l)(21) for the taxable year ending with or 
                within the second calendar year preceding the 
                calendar year in which the plan year begins.
                  (B) Certain individual health insurance 
                policies obtained through small employers.--The 
                amount of the enrollee's permitted benefit (as 
                defined in section 9831(d)(3)(C) of the 
                Internal Revenue Code of 1986) under a 
                qualified small employer health reimbursement 
                arrangement (as defined in section 9831(d)(2) 
                of such Code).
                  (C) Changes in circumstances.--The 
                information described in section 1412(b)(2), 
                including information with respect to 
                individuals who were not required to file an 
                income tax return for the taxable year 
                described in subparagraph (A) or individuals 
                who experienced changes in marital status or 
                family size or significant reductions in 
                income.
          (4) Employer-sponsored coverage.--In the case of an 
        enrollee with respect to whom eligibility for a premium 
        tax credit under section 36B of such Code or cost-
        sharing reduction under section 1402 is being 
        established on the basis that the enrollee's (or 
        related individual's) employer is not treated under 
        section 36B(c)(2)(C) of such Code as providing minimum 
        essential coverage or affordable minimum essential 
        coverage, the following information:
                  (A) The name, address, and employer 
                identification number (if available) of the 
                employer.
                  (B) Whether the enrollee or individual is a 
                full-time employee and whether the employer 
                provides such minimum essential coverage.
                  (C) If the employer provides such minimum 
                essential coverage, the lowest cost option for 
                the enrollee's or individual's enrollment 
                status and the enrollee's or individual's 
                required contribution (within the meaning of 
                section 5000A(e)(1)(B) of such Code) under the 
                employer-sponsored plan.
                  (D) If an enrollee claims an employer's 
                minimum essential coverage is unaffordable, the 
                information described in paragraph (3).
        If an enrollee changes employment or obtains additional 
        employment while enrolled in a qualified health plan 
        for which such credit or reduction is allowed, the 
        enrollee shall notify the Exchange of such change or 
        additional employment and provide the information 
        described in this paragraph with respect to the new 
        employer.
          (5) Exemptions from individual responsibility 
        requirements.--In the case of an individual who is 
        seeking an exemption certificate under section 
        1311(d)(4)(H) from any requirement or penalty imposed 
        by section 5000A, the following information:
                  (A) In the case of an individual seeking 
                exemption based on the individual's status as a 
                member of an exempt religious sect or division, 
                as a member of a health care sharing ministry, 
                as an Indian, or as an individual eligible for 
                a hardship exemption, such information as the 
                Secretary shall prescribe.
                  (B) In the case of an individual seeking 
                exemption based on the lack of affordable 
                coverage or the individual's status as a 
                taxpayer with household income less than 100 
                percent of the poverty line, the information 
                described in paragraphs (3) and (4), as 
                applicable.
  (c) Verification of Information Contained in Records of 
Specific Federal Officials.--
          (1) Information transferred to Secretary.--An 
        Exchange shall submit the information provided by an 
        applicant under subsection (b) to the Secretary for 
        verification in accordance with the requirements of 
        this subsection and subsection (d).
          (2) Citizenship or immigration status.--
                  (A) Commissioner of Social Security.--The 
                Secretary shall submit to the Commissioner of 
                Social Security the following information for a 
                determination as to whether the information 
                provided is consistent with the information in 
                the records of the Commissioner:
                          (i) The name, date of birth, and 
                        social security number of each 
                        individual for whom such information 
                        was provided under subsection (b)(2).
                          (ii) The attestation of an individual 
                        that the individual is a citizen.
                  (B) Secretary of Homeland Security.--
                          (i) In general.--In the case of an 
                        individual--
                                  (I) who attests that the 
                                individual is an alien lawfully 
                                present in the United States; 
                                or
                                  (II) who attests that the 
                                individual is a citizen but 
                                with respect to whom the 
                                Commissioner of Social Security 
                                has notified the Secretary 
                                under subsection (e)(3) that 
                                the attestation is inconsistent 
                                with information in the records 
                                maintained by the Commissioner;
                        the Secretary shall submit to the 
                        Secretary of Homeland Security the 
                        information described in clause (ii) 
                        for a determination as to whether the 
                        information provided is consistent with 
                        the information in the records of the 
                        Secretary of Homeland Security.
                          (ii) Information.--The information 
                        described in clause (ii) is the 
                        following:
                                  (I) The name, date of birth, 
                                and any identifying information 
                                with respect to the 
                                individual's immigration status 
                                provided under subsection 
                                (b)(2).
                                  (II) The attestation that the 
                                individual is an alien lawfully 
                                present in the United States or 
                                in the case of an individual 
                                described in clause (i)(II), 
                                the attestation that the 
                                individual is a citizen.
          (3) Eligibility for tax credit and cost-sharing 
        reduction.--The Secretary shall submit the information 
        described in subsection (b)(3)(A) provided under 
        paragraph (3), (4), or (5) of subsection (b) to the 
        Secretary of the Treasury for verification of household 
        income and family size for purposes of eligibility.
          (4) Methods.--
                  (A) In general.--The Secretary, in 
                consultation with the Secretary of the 
                Treasury, the Secretary of Homeland Security, 
                and the Commissioner of Social Security, shall 
                provide that verifications and determinations 
                under this subsection shall be done--
                          (i) through use of an on-line system 
                        or otherwise for the electronic 
                        submission of, and response to, the 
                        information submitted under this 
                        subsection with respect to an 
                        applicant; or
                          (ii) by determining the consistency 
                        of the information submitted with the 
                        information maintained in the records 
                        of the Secretary of the Treasury, the 
                        Secretary of Homeland Security, or the 
                        Commissioner of Social Security through 
                        such other method as is approved by the 
                        Secretary.
                  (B) Flexibility.--The Secretary may modify 
                the methods used under the program established 
                by this section for the Exchange and 
                verification of information if the Secretary 
                determines such modifications would reduce the 
                administrative costs and burdens on the 
                applicant, including allowing an applicant to 
                request the Secretary of the Treasury to 
                provide the information described in paragraph 
                (3) directly to the Exchange or to the 
                Secretary. The Secretary shall not make any 
                such modification unless the Secretary 
                determines that any applicable requirements 
                under this section and section 6103 of the 
                Internal Revenue Code of 1986 with respect to 
                the confidentiality, disclosure, maintenance, 
                or use of information will be met.
  (d) Verification by Secretary.--In the case of information 
provided under subsection (b) that is not required under 
subsection (c) to be submitted to another person for 
verification, the Secretary shall verify the accuracy of such 
information in such manner as the Secretary determines 
appropriate, including delegating responsibility for 
verification to the Exchange.
  (e) Actions Relating to Verification.--
          (1) In general.--Each person to whom the Secretary 
        provided information under subsection (c) shall report 
        to the Secretary under the method established under 
        subsection (c)(4) the results of its verification and 
        the Secretary shall notify the Exchange of such 
        results. Each person to whom the Secretary provided 
        information under subsection (d) shall report to the 
        Secretary in such manner as the Secretary determines 
        appropriate.
          (2) Verification.--
                  (A) Eligibility for enrollment and premium 
                tax credits and cost-sharing reductions.--If 
                information provided by an applicant under 
                paragraphs (1), (2), (3), and (4) of subsection 
                (b) is verified under subsections (c) and (d)--
                          (i) the individual's eligibility to 
                        enroll through the Exchange and to 
                        apply for premium tax credits and cost-
                        sharing reductions shall be satisfied; 
                        and
                          (ii) the Secretary shall, if 
                        applicable, notify the Secretary of the 
                        Treasury under section 1412(c) of the 
                        amount of any advance payment to be 
                        made.
                  (B) Exemption from individual 
                responsibility.--If information provided by an 
                applicant under subsection (b)(5) is verified 
                under subsections (c) and (d), the Secretary 
                shall issue the certification of exemption 
                described in section 1311(d)(4)(H).
          (3) Inconsistencies involving attestation of 
        citizenship or lawful presence.--If the information 
        provided by any applicant under subsection (b)(2) is 
        inconsistent with information in the records maintained 
        by the Commissioner of Social Security or Secretary of 
        Homeland Security, whichever is applicable, the 
        applicant's eligibility (other than eligibility for 
        advance payment of a credit under section 1412) will be 
        determined in the same manner as an individual's 
        eligibility under the medicaid program is determined 
        under section 1902(ee) of the Social Security Act (as 
        in effect on January 1, 2010).
          (4) Inconsistencies involving other information.--
                  (A) In general.--If the information provided 
                by an applicant under subsection (b) (other 
                than subsection (b)(2)) is inconsistent with 
                information in the records maintained by 
                persons under subsection (c) or is not verified 
                under subsection (d), the Secretary shall 
                notify the Exchange and the Exchange shall take 
                the following actions:
                          (i) Reasonable effort.--The Exchange 
                        shall make a reasonable effort to 
                        identify and address the causes of such 
                        inconsistency, including through 
                        typographical or other clerical errors, 
                        by contacting the applicant to confirm 
                        the accuracy of the information, and by 
                        taking such additional actions as the 
                        Secretary, through regulation or other 
                        guidance, may identify.
                          (ii) Notice and opportunity to 
                        correct.--In the case the inconsistency 
                        or inability to verify is not resolved 
                        under subparagraph (A), the Exchange 
                        shall--
                                  (I) notify the applicant of 
                                such fact;
                                  (II) provide the applicant an 
                                opportunity to either present 
                                satisfactory documentary 
                                evidence or resolve the 
                                inconsistency with the person 
                                verifying the information under 
                                subsection (c) or (d) during 
                                the 90-day period beginning the 
                                date on which the notice 
                                required under subclause (I) is 
                                sent to the applicant.
                        The Secretary may extend the 90-day 
                        period under subclause (II) for 
                        enrollments occurring during 2014.
                  (B) Specific actions not involving 
                citizenship or lawful presence.--
                          (i) In general.--Except as provided 
                        in paragraph (3), the Exchange shall, 
                        during any period before the close of 
                        the period under subparagraph 
                        (A)(ii)(II), make any determination 
                        under paragraphs (2), (3), and (4) of 
                        subsection (a) on the basis of the 
                        information contained on the 
                        application.
                          (ii) Eligibility or amount of credit 
                        or reduction.--If an inconsistency 
                        involving the eligibility for, or 
                        amount of, any premium tax credit or 
                        cost-sharing reduction is unresolved 
                        under this subsection as of the close 
                        of the period under subparagraph 
                        (A)(ii)(II), the Exchange shall notify 
                        the applicant of the amount (if any) of 
                        the credit or reduction that is 
                        determined on the basis of the records 
                        maintained by persons under subsection 
                        (c).
                          (iii) Employer affordability.--If the 
                        Secretary notifies an Exchange that an 
                        enrollee is eligible for a premium tax 
                        credit under section 36B of such Code 
                        or cost-sharing reduction under section 
                        1402 because the enrollee's (or related 
                        individual's) employer does not provide 
                        minimum essential coverage through an 
                        employer-sponsored plan or that the 
                        employer does provide that coverage but 
                        it is not affordable coverage, the 
                        Exchange shall notify the employer of 
                        such fact and that the employer may be 
                        liable for the payment assessed under 
                        section 4980H of such Code.
                          (iv) Exemption.--In any case where 
                        the inconsistency involving, or 
                        inability to verify, information 
                        provided under subsection (b)(5) is not 
                        resolved as of the close of the period 
                        under subparagraph (A)(ii)(II), the 
                        Exchange shall notify an applicant that 
                        no certification of exemption from any 
                        requirement or payment under section 
                        5000A of such Code will be issued.
                  (C) Appeals process.--The Exchange shall also 
                notify each person receiving notice under this 
                paragraph of the appeals processes established 
                under subsection (f).
          (5) Delay permitted in coverage date in case of delay 
        in verification of status for individuals applying for 
        advance payment of credit.--In the case of an 
        individual whose eligibility for advance payments is 
        delayed by reason of the requirement for verification 
        under subsection (c)(2), if, for coverage to be 
        effective as of the date requested in the individual's 
        application for enrollment, the individual would (but 
        for this paragraph) be required to pay 2 or more months 
        of retroactive premiums, the individual shall be 
        provided the option to elect to postpone the effective 
        date of coverage to the date that is not more than 1 
        month later than the date requested in the individual's 
        application for enrollment.
  (f) Appeals and Redeterminations.--
          (1) In general.--The Secretary, in consultation with 
        the Secretary of the Treasury, the Secretary of 
        Homeland Security, and the Commissioner of Social 
        Security, shall establish procedures by which the 
        Secretary or one of such other Federal officers--
                  (A) hears and makes decisions with respect to 
                appeals of any determination under subsection 
                (e); and
                  (B) redetermines eligibility on a periodic 
                basis in appropriate circumstances.
          (2) Employer liability.--
                  (A) In general.--The Secretary shall 
                establish a separate appeals process for 
                employers who are notified under subsection 
                (e)(4)(C) that the employer may be liable for a 
                tax imposed by section 4980H of the Internal 
                Revenue Code of 1986 with respect to an 
                employee because of a determination that the 
                employer does not provide minimum essential 
                coverage through an employer-sponsored plan or 
                that the employer does provide that coverage 
                but it is not affordable coverage with respect 
                to an employee. Such process shall provide an 
                employer the opportunity to--
                          (i) present information to the 
                        Exchange for review of the 
                        determination either by the Exchange or 
                        the person making the determination, 
                        including evidence of the employer-
                        sponsored plan and employer 
                        contributions to the plan; and
                          (ii) have access to the data used to 
                        make the determination to the extent 
                        allowable by law.
                Such process shall be in addition to any rights 
                of appeal the employer may have under subtitle 
                F of such Code.
                  (B) Confidentiality.--Notwithstanding any 
                provision of this title (or the amendments made 
                by this title) or section 6103 of the Internal 
                Revenue Code of 1986, an employer shall not be 
                entitled to any taxpayer return information 
                with respect to an employee for purposes of 
                determining whether the employer is subject to 
                the penalty under section 4980H of such Code 
                with respect to the employee, except that--
                          (i) the employer may be notified as 
                        to the name of an employee and whether 
                        or not the employee's income is above 
                        or below the threshold by which the 
                        affordability of an employer's health 
                        insurance coverage is measured; and
                          (ii) this subparagraph shall not 
                        apply to an employee who provides a 
                        waiver (at such time and in such manner 
                        as the Secretary may prescribe) 
                        authorizing an employer to have access 
                        to the employee's taxpayer return 
                        information.
  (g) Confidentiality of Applicant Information.--
          (1) In general.--An applicant for insurance coverage 
        or for a premium tax credit or cost-sharing reduction 
        shall be required to provide only the information 
        strictly necessary to authenticate identity, determine 
        eligibility, and determine the amount of the credit or 
        reduction.
          (2) Receipt of information.--Any person who receives 
        information provided by an applicant under subsection 
        (b) (whether directly or by another person at the 
        request of the applicant), or receives information from 
        a Federal agency under subsection (c), (d), or (e), 
        shall--
                  (A) use the information only for the purposes 
                of, and to the extent necessary in, ensuring 
                the efficient operation of the Exchange, 
                including verifying the eligibility of an 
                individual to enroll through an Exchange or to 
                claim a premium tax credit or cost-sharing 
                reduction or the amount of the credit or 
                reduction; and
                  (B) not disclose the information to any other 
                person except as provided in this section.
  (h) Penalties.--
          (1) False or fraudulent information.--
                  (A) Civil penalty.--
                          (i) In general.--If--
                                  (I) any person fails to 
                                provides correct information 
                                under subsection (b); and
                                  (II) such failure is 
                                attributable to negligence or 
                                disregard of any rules or 
                                regulations of the Secretary,
                        such person shall be subject, in 
                        addition to any other penalties that 
                        may be prescribed by law, to a civil 
                        penalty of not more than $25,000 with 
                        respect to any failures involving an 
                        application for a plan year. For 
                        purposes of this subparagraph, the 
                        terms ``negligence'' and ``disregard'' 
                        shall have the same meanings as when 
                        used in section 6662 of the Internal 
                        Revenue Code of 1986.
                          (ii) Reasonable cause exception.--No 
                        penalty shall be imposed under clause 
                        (i) if the Secretary determines that 
                        there was a reasonable cause for the 
                        failure and that the person acted in 
                        good faith.
                  (B) Knowing and willful violations.--Any 
                person who knowingly and willfully provides 
                false or fraudulent information under 
                subsection (b) shall be subject, in addition to 
                any other penalties that may be prescribed by 
                law, to a civil penalty of not more than 
                $250,000.
          (2) Improper use or disclosure of information.--Any 
        person who knowingly and willfully uses or discloses 
        information in violation of subsection (g) shall be 
        subject, in addition to any other penalties that may be 
        prescribed by law, to a civil penalty of not more than 
        $25,000.
          (3) Limitations on liens and levies.--The Secretary 
        (or, if applicable, the Attorney General of the United 
        States) shall not--
                  (A) file notice of lien with respect to any 
                property of a person by reason of any failure 
                to pay the penalty imposed by this subsection; 
                or
                  (B) levy on any such property with respect to 
                such failure.
  (i) Study of Administration of Employer Responsibility.--
          (1) In general.--The Secretary of Health and Human 
        Services shall, in consultation with the Secretary of 
        the Treasury, conduct a study of the procedures that 
        are necessary to ensure that in the administration of 
        this title and section 4980H of the Internal Revenue 
        Code of 1986 (as added by section 1513) that the 
        following rights are protected:
                  (A) The rights of employees to preserve their 
                right to confidentiality of their taxpayer 
                return information and their right to enroll in 
                a qualified health plan through an Exchange if 
                an employer does not provide affordable 
                coverage.
                  (B) The rights of employers to adequate due 
                process and access to information necessary to 
                accurately determine any payment assessed on 
                employers.
          (2) Report.--Not later than January 1, 2013, the 
        Secretary of Health and Human Services shall report the 
        results of the study conducted under paragraph (1), 
        including any recommendations for legislative changes, 
        to the Committees on Finance and Health, Education, 
        Labor and Pensions of the Senate and the Committees of 
        Education and Labor and Ways and Means of the House of 
        Representatives.

           *       *       *       *       *       *       *


                         VII. DISSENTING VIEWS

    H.R. 2581 (Barletta, R-PA) amends H.R. 1628, the American 
Health Care Act (AHCA), to require individuals to complete 
identity authentication by providing a Social Security number 
(SSN) (and disallowing the use of an Individual Taxpayer 
Identification number (ITIN)) before receiving any advanceable 
tax credit established by the AHCA, as well as advanced premium 
tax credits (APTC) provided under current law, and on any tax 
return claiming health insurance premium tax credits. The 
Barletta bill amends AHCA, which has not passed the Senate or 
been enacted into law.
    The Barletta bill fails to address the major, underlying 
flaws in the bill it amends. According to the nonpartisan, 
independent Congressional Budget Office (CBO), the AHCA would 
cause 23 million Americans to lose health insurance coverage, 
erode important consumer protections, and raise out-of-pocket 
health care costs for countless more Americans. H.R. 2581 does 
not address any of the problems that would undermine the health 
security for millions of working families.
    Instead, the Barletta bill could exacerbate the ability to 
access affordable coverage that would be created by the AHCA 
for working families by increasing administrative barriers, 
requiring more government paperwork, and reducing access to 
affordable coverage. Ultimately, for someone who is ill, 
delayed care could mean the difference between accessing life-
saving treatment and going without much needed care.
    The Barletta bill fails to recognize unique circumstances 
of American families, forcing a one-size-fits-all approach to 
accessing financial help. Not all individuals who are eligible 
for tax credits have an SSN or are eligible to obtain an SSN 
that can be verified at the time of application. Some people, 
like newborns, may not have an SSN at the time their family 
applies on their behalf. Other individuals, like domestic 
violence survivors and survivors of human trafficking, may have 
no need to have an SSN related to work and would experience 
delays in accessing health coverage as a result of this 
requirement.
    Delays in the eligibility process would be significant 
because people must enroll during open enrollment or within a 
special enrollment period. People can enroll without premium 
tax credits (PTCs) but even one or two months of enrollment 
without PTCs could result in significant financial hardship. 
For some people, like newborn babies, the delay in obtaining an 
SSN will be modest (on average, four weeks). Other groups may 
experience far longer delays if they must take steps like 
getting a work authorization prior to being able to obtain an 
SSN. In fact, the legislation itself acknowledges that this new 
bureaucratic barrier could cause delays in accessing credits of 
more than two months.
    Under current law, initial verification of eligibility for 
APTCs occurs at the time an individual applies for coverage 
through the Marketplace. If an individual does not have an SSN, 
or if there is a problem verifying the SSN, a secondary 
verification process occurs. Under the law, the agency needs to 
notify the consumer of the problem verifying eligibility, and 
the applicant has 90 days to provide documentation or otherwise 
address the issues. During this verification process, 
individuals are presumed eligible to enroll in Marketplace 
coverage and, if appropriate, also provided financial 
assistance. If the individual is unable to provide 
documentation of eligibility, coverage and financial assistance 
is terminated. Under current law, individuals are not left in 
the position of needing coverage but having to wait potentially 
months to receive verification of eligibility for tax credits 
to afford that coverage.
    This legislation would simply make it harder for 
individuals in need of financial assistance to purchase 
insurance coverage. Some people would forgo coverage due to the 
bureaucratic complications, and others would experience delays 
in accessing that coverage.
    No evidence exists that says the current process isn't 
working or ineligible individuals fraudulently are claiming the 
APTCs. Rep. Barletta claims that 500,000 undocumented 
immigrants received $750 million in premium tax credits. These 
claims are false and there is no evidence that supports these 
allegations.
    As the source of information to support his claim, Rep. 
Barletta has pointed to a February 2016 majority staff report 
from the United States Senate Committee on Homeland Security 
and Governmental Affairs. However, this report does not make 
this claim, rather the report claims that ``as of September 30, 
2015, CMS awarded approximately $750 million in APTCs to 
individuals enrolled in FFMs who CMS later determined to be 
ineligible because the individuals failed to verify their 
citizenship, status as a national, or legal presence.''
    The report does not make the leap that these individuals 
are undocumented immigrants, rather it focuses on their 
termination being linked to failure to verify their status. 
There is no evidence that suggests these individuals were 
undocumented immigrants--only that they never got around to 
providing the remaining documentation to keep coverage. This 
could have happened for any number of reasons, for example, 
they could have abandoned the process because of securing a job 
with coverage or moving out of state.
    The number of people whose coverage was terminated for 
failure to provide necessary documentation continues to 
decline. Efforts have become more refined as the program 
matures, meaning fewer individuals are experiencing 
documentation problems, especially as electronic interfaces 
have improved.
    Democrats offered two amendments to highlight serious 
shortcomings with H.R. 2581 and the continued issue that 
President Trump has not released his tax returns. Both 
amendments were ruled non-germane by Chairman Kevin Brady (R-
TX) and appealed by Democratic Members. The appeals were then 
defeated by party-line votes.
    Congresswoman Sanchez (D-CA) offered an amendment to stop 
the provisions of H.R. 2581 from taking effect if the Inspector 
General of the Department of Health and Human Services 
determines that more than three percent (3%) of American 
citizens eligible for APTCs experience a disbursement delay. By 
having an impartial organization certify this threshold, the 
amendment would protect American citizens from suffering a 
delay in the disbursement of their APTCs as a result of this 
bill. Specifically, this amendment would protect the many APTC-
eligible American citizens most likely to suffer the unintended 
consequences of this bill. Low-income American citizens, 
particularly naturalized Americans from immigrant families, 
have a more difficult time producing the documentation needed 
to verify their citizenship. These Americans are also more 
likely to have errors in their records because of the spelling 
of their surnames or the number of people who share the same 
name. This common sense fix would ensure that those who need 
coverage the most, including newborn children, will not have to 
wait for our system to ``verify'' their status.
    Congressman Doggett (D-TX) offered an amendment to require 
President Trump to provide his tax returns under the 
Committee's oversight authority. The Committee considered this 
matter previously. Congress, the Legislative Branch, has the 
responsibility and the authority to check the Executive Branch. 
As we have discussed, Section 6103 of the tax code allows for 
an examination of the President's tax returns--authority put in 
place following the Teapot Dome scandal specifically so 
Congress could examine conflicts of interest in the Executive 
Branch. This is a genuine ``Verify First'' amendment. Before 
Congress assumes fraud and delays Americans' access to health 
care, we need to verify first how much President Trump and his 
family would be enriched by changes made by the AHCA and how 
the many corporate entities over which he exercises control 
would be enriched. Moreover, we also need to know whether this 
is about personal enrichment of President Trump or if it is 
about the enrichment of our nation's economy. We also should 
take this opportunity to verify that there is no other 
conflicts of interest as we move forward in legislation 
impacting the tax code.
    For the reasons stated above, Democrats opposed this 
legislation as it imposes additional and unnecessary 
bureaucratic paperwork on working families that are in need of 
financial assistance to afford their health insurance premiums.

                                   Richard E. Neal,
                                           Ranking Member.

                                  [all]