One Hundred Fourteenth Congress of the United States of America
At the Second Session
Begun and held at the City of Washington on Monday, the fourth day of January, two thousand and sixteen
H. R. 3762
AN ACT
To provide for reconciliation pursuant to section 2002 of the concurrent resolution on the budget for fiscal year 2016.
Health, Education, Labor, and Pensions
The prevention and public health fund
In general
Subsection (b) of section 4002 of the Patient Protection and Affordable Care Act (42 U.S.C. 300u–11) is amended—
in paragraph (2), by striking 2017
and inserting 2015
; and
by striking paragraphs (3) through (5).
Rescission of unobligated funds
Of the funds made available by such section 4002, the unobligated balance is rescinded.
Community health center program
Effective as if included in the enactment of the Medicare Access and CHIP Reauthorization Act of 2015 (Public Law 114–10, 129 Stat. 87), paragraph (1) of section 221(a) of such Act is amended by inserting after Section 10503(b)(1)(E) of the Patient Protection and Affordable Care Act (42 U.S.C. 254b–2(b)(1)(E)) is amended
the following: by striking
.$3,600,000,000
and inserting $3,835,000,000
and
Territories
Section 1323(c) of the Patient Protection and Affordable Care Act (42 U.S.C. 18043(c)) is amended by adding at the end the following:
No force and effect
Effective January 1, 2018, this subsection shall have no force or effect.
.
Reinsurance, risk corridor, and risk adjustment programs
Transitional reinsurance program for individual market
Section 1341 of the Patient Protection and Affordable Care Act (42 U.S.C. 18061) is amended by adding at the end the following:
No force and effect
Effective January 1, 2016, the Secretary shall not collect fees and shall not make payments under this section.
.
Support for State response to substance abuse public health crisis and urgent mental health needs
In general
There are authorized to be appropriated, and are appropriated, out of monies in the Treasury not otherwise obligated, $750,000,000 for each of fiscal years 2016 and 2017, to the Secretary of Health and Human Services (referred to in this section as the Secretary
) to award grants to States to address the substance abuse public health crisis or to respond to urgent mental health needs within the State. In awarding grants under this section, the Secretary may give preference to States with an incidence or prevalence of substance use disorders that is substantial relative to other States or to States that identify mental health needs within their communities that are urgent relative to such needs of other States. Funds appropriated under this subsection shall remain available until expended.
Use of funds
Grants awarded to a State under subsection (a) shall be used for one or more of the following public health-related activities:
Improving State prescription drug monitoring programs.
Implementing prevention activities, and evaluating such activities to identify effective strategies to prevent substance abuse.
Training for health care practitioners, such as best practices for prescribing opioids, pain management, recognizing potential cases of substance abuse, referral of patients to treatment programs, and overdose prevention.
Supporting access to health care services provided by federally certified opioid treatment programs or other appropriate health care providers to treat substance use disorders or mental health needs.
Other public health-related activities, as the State determines appropriate, related to addressing the substance abuse public health crisis or responding to urgent mental health needs within the State.
Finance
Recapture excess advance payments of premium tax credits
Subparagraph (B) of section 36B(f)(2) of the Internal Revenue Code of 1986 is amended by adding at the end the following new clause:
Nonapplicability of limitation
This subparagraph shall not apply to taxable years ending after December 31, 2015, and before January 1, 2018.
.
Premium tax credit and cost-Sharing subsidies
Repeal of premium tax credit
Subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by striking section 36B.
Repeal of cost-Sharing subsidy
Section 1402 of the Patient Protection and Affordable Care Act is repealed.
Repeal of eligibility determinations
The following sections of the Patient Protection and Affordable Care Act are repealed:
Section 1411 (other than subsection (i), the last sentence of subsection (e)(4)(A)(ii), and such provisions of such section solely to the extent related to the application of the last sentence of subsection (e)(4)(A)(ii)).
Section 1412.
Protecting Americans by repeal of disclosure authority To carry out eligibility requirements for certain programs
In general
Paragraph (21) of section 6103(l) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:
Termination
No disclosure may be made under this paragraph after December 31, 2017.
.
Effective dates
Premium tax credit
The amendment made by subsection (a) shall apply to taxable years beginning after December 31, 2017.
Cost sharing-subsidies and eligibility determinations
The repeals in subsection (b) and (c) shall take effect on December 31, 2017.
Protecting Americans by rescinding disclosure authority
The amendments made by subsection (d) shall take effect on December 31, 2017.
Small business tax credit
In general
Section 45R of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:
Shall not apply
This section shall not apply with respect to amounts paid or incurred in taxable years beginning after December 31, 2017.
.
Effective date
The amendment made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2017.
Individual mandate
In general
Section 5000A(c) of the Internal Revenue Code of 1986 is amended—
in paragraph (2)(B) by striking clauses (ii) and (iii) and inserting the following:
Zero percent for taxable years beginning after 2014.
, and
in paragraph (3)—
by striking $695
in subparagraph (A) and inserting $0
,
by striking and $325 for 2015
in subparagraph (B), and
by striking subparagraph (D).
Effective date
The amendments made by this section shall apply to months beginning after December 31, 2014.
Employer mandate
In general
Paragraph (1) of section 4980H(c) of the Internal Revenue Code of 1986 is amended by inserting ($0 in the case of months beginning after December 31, 2014)
after $2,000
.
Paragraph (1) of section 4980H(b) of the Internal Revenue Code of 1986 is amended by inserting ($0 in the case of months beginning after December 31, 2014)
after $3,000
.
Effective date
The amendments made by this section shall apply to months beginning after December 31, 2014.
Federal payments to States
In general
Notwithstanding section 504(a), 1902(a)(23), 1903(a), 2002, 2005(a)(4), 2102(a)(7), or 2105(a)(1) of the Social Security Act (42 U.S.C. 704(a), 1396a(a)(23), 1396b(a), 1397a, 1397d(a)(4), 1397bb(a)(7), 1397ee(a)(1)), or the terms of any Medicaid waiver in effect on the date of enactment of this Act that is approved under section 1115 or 1915 of the Social Security Act (42 U.S.C. 1315, 1396n), for the 1-year period beginning on the date of enactment of this Act, no Federal funds provided from a program referred to in this subsection that is considered direct spending for any year may be made available to a State for payments to a prohibited entity, whether made directly to the prohibited entity or through a managed care organization under contract with the State.
Definitions
In this section:
Prohibited entity
The term prohibited entity means an entity, including its affiliates, subsidiaries, successors, and clinics—
that, as of the date of enactment of this Act—
is an organization described in section 501(c)(3) of the Internal Revenue Code of 1986 and exempt from tax under section 501(a) of such Code;
is an essential community provider described in section 156.235 of title 45, Code of Federal Regulations (as in effect on the date of enactment of this Act), that is primarily engaged in family planning services, reproductive health, and related medical care; and
provides for abortions, other than an abortion—
if the pregnancy is the result of an act of rape or incest; or
in the case where a woman suffers from a physical disorder, physical injury, or physical illness that would, as certified by a physician, place the woman in danger of death unless an abortion is performed, including a life-endangering physical condition caused by or arising from the pregnancy itself; and
for which the total amount of Federal and State expenditures under the Medicaid program under title XIX of the Social Security Act in fiscal year 2014 made directly to the entity and to any affiliates, subsidiaries, successors, or clinics of the entity, or made to the entity and to any affiliates, subsidiaries, successors, or clinics of the entity as part of a nationwide health care provider network, exceeded $350,000,000.
Direct spending
The term direct spending has the meaning given that term under section 250(c) of the Balanced Budget and Emergency Deficit Control Act of 1985 (2 U.S.C. 900(c)).
Medicaid
The Social Security Act (42 U.S.C. 301 et seq.) is amended—
in section 1108(g)(5), by striking 2019
and inserting 2017
;
in section 1902—
in subsection (a)(10)(A), in each of clauses (i)(VIII) and (ii)(XX), by inserting and ending December 31, 2017,
after January 1, 2014,
;
in subsection (a)(47)(B), by inserting and provided that any such election shall cease to be effective on January 1, 2018, and no such election shall be made after that date
before the semicolon at the end; and
in subsection (l)(2)(C), by inserting and ending December 31, 2017,
after January 1, 2014,
;
in each of sections 1902(gg)(2) and 2105(d)(3)(A), by striking September 30, 2019
and inserting September 30, 2017
;
in section 1905—
in the first sentence of subsection (b), by inserting (50 percent on or after January 1, 2018)
after 55 percent
;
in subsection (y)(1), by striking the semicolon at the end of subparagraph (B) and all that follows through thereafter
; and
in subsection (z)(2)—
in subparagraph (A), by striking each year thereafter
and inserting through 2017
; and
in subparagraph (B)(ii), by striking the semicolon at the end of subclause (IV) and all that follows through 100 percent
;
in section 1915(k)(2), by striking during the period described in paragraph (1)
and inserting on or after the date referred to in paragraph (1) and before January 1, 2018
;
in section 1920(e), by adding at the end the following: This subsection shall not apply after December 31, 2017.
;
in section 1937(b)(5), by adding at the end the following: This paragraph shall not apply after December 31, 2017.
; and
in section 1943(a), by inserting and before January 1, 2018,
after January 1, 2014,
.
Repeal of DSH allotment reductions
Section 1923(f) of the Social Security Act (42 U.S.C. 1396r–4(f)) is amended by striking paragraphs (7) and (8).
Repeal of the tax on employee health insurance premiums and health plan benefits
In general
Chapter 43 of the Internal Revenue Code of 1986 is amended by striking section 4980I.
Effective date
The amendment made by subsection (a) shall apply to taxable years beginning after December 31, 2017.
Repeal of tax on over-the-counter medications
HSAs
Subparagraph (A) of section 223(d)(2) of the Internal Revenue Code of 1986 is amended by striking Such term
and all that follows through the period.
Archer MSAs
Subparagraph (A) of section 220(d)(2) of the Internal Revenue Code of 1986 is amended by striking Such term
and all that follows through the period.
Health flexible spending arrangements and health reimbursement arrangements
Section 106 of the Internal Revenue Code of 1986 is amended by striking subsection (f).
Effective dates
Distributions from savings accounts
The amendments made by subsections (a) and (b) shall apply to amounts paid with respect to taxable years beginning after December 31, 2015.
Reimbursements
The amendment made by subsection (c) shall apply to expenses incurred with respect to taxable years beginning after December 31, 2015.
Repeal of tax on health savings accounts
HSAs
Section 223(f)(4)(A) of the Internal Revenue Code of 1986 is amended by striking 20 percent
and inserting 10 percent
.
Archer MSAs
Section 220(f)(4)(A) of the Internal Revenue Code of 1986 is amended by striking 20 percent
and inserting 15 percent
.
Effective date
The amendments made by this section shall apply to distributions made after December 31, 2015.
Repeal of limitations on contributions to flexible spending accounts
In general
Section 125 of the Internal Revenue Code of 1986 is amended by striking subsection (i).
Effective date
The amendment made by this section shall apply to taxable years beginning after December 31, 2015.
Repeal of tax on prescription medications
Subsection (j) of section 9008 of the Patient Protection and Affordable Care Act is amended to read as follows:
Repeal
This section shall apply to calendar years beginning after December 31, 2010, and ending before January 1, 2016.
.
Repeal of medical device excise tax
In general
Chapter 32 of the Internal Revenue Code of 1986 is amended by striking subchapter E.
Effective date
The amendment made by this section shall apply to sales in calendar quarters beginning after December 31, 2015.
Repeal of health insurance tax
Subsection (j) of section 9010 of the Patient Protection and Affordable Care Act is amended to read as follows:
Repeal
This section shall apply to calendar years beginning after December 31, 2013, and ending before January 1, 2016.
.
Repeal of elimination of deduction for expenses allocable to medicare part D subsidy
In general
Section 139A of the Internal Revenue Code of 1986 is amended by adding at the end the following new sentence: This section shall not be taken into account for purposes of determining whether any deduction is allowable with respect to any cost taken into account in determining such payment.
.
Effective date
The amendment made by this section shall apply to taxable years beginning after December 31, 2015.
Repeal of chronic care tax
In general
Subsection (a) of section 213 of the Internal Revenue Code of 1986 is amended by striking 10 percent
and inserting 7.5 percent
.
Effective date
The amendment made by this section shall apply to taxable years beginning after December 31, 2015.
Repeal of Medicare tax increase
In general
Subsection (b) of section 3101 of the Internal Revenue Code of 1986 is amended to read as follows:
Hospital insurance
In addition to the tax imposed by the preceding subsection, there is hereby imposed on the income of every individual a tax equal to 1.45 percent of the wages (as defined in section 3121(a)) received by such individual with respect to employment (as defined in section 3121(b).
.
SECA
Subsection (b) of section 1401 of the Internal Revenue Code of 1986 is amended to read as follows:
Hospital insurance
In addition to the tax imposed by the preceding subsection, there shall be imposed for each taxable year, on the self-employment income of every individual, a tax equal to 2.9 percent of the amount of the self-employment income for such taxable year.
.
Effective date
The amendments made by this section shall apply with respect to remuneration received after, and taxable years beginning after, December 31, 2015.
Repeal of tanning tax
In general
The Internal Revenue Code of 1986 is amended by striking chapter 49.
Effective date
The amendment made by this section shall apply to services performed on or after December 31, 2015.
Repeal of net investment tax
In general
Subtitle A of the Internal Revenue Code of 1986 is amended by striking chapter 2A.
Effective date
The amendment made by this section shall apply to taxable years beginning after December 31, 2015.
Remuneration
Paragraph (6) of section 162(m) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:
Termination
This paragraph shall not apply to taxable years beginning after December 31, 2015.
.
Economic substance doctrine
In general
Subsection (o) of section 7701 of the Internal Revenue Code of 1986 is repealed.
Penalty for underpayments
Paragraph (6) of section 6662(b) of the Internal Revenue Code of 1986 is repealed.
Increased penalty for nondisclosed transactions
Subsection (i) of section 6662 of the Internal Revenue Code of 1986 is repealed.
Reasonable cause exception for underpayments
Paragraph (2) of section 6664(c) of the Internal Revenue Code of 1986 is repealed.
Reasonable cause exception for nondisclosed transactions
Paragraph (2) of section 6664(d) of the Internal Revenue Code of 1986 is repealed.
Erroneous claim for refund or credit
Subsection (c) of section 6676 of the Internal Revenue Code of 1986 is repealed.
Effective date
The repeals made by this section shall apply to transactions entered into, and to underpayments, understatements, or refunds and credits attributable to transactions entered into, after December 31, 2015.
Budgetary savings for extending medicare solvency
As a result of policies contained in this Act, the Secretary of the Treasury shall transfer to the Federal Hospital Insurance Trust Fund under section 1817 of the Social Security Act (42 U.S.C. 1395i) $379,300,000,000 (which represents the full amount of on-budget savings during the period of fiscal years 2016 through 2025) for extending Medicare solvency, to remain available until expended.
Speaker of the House of Representatives.
Vice President of the United States and President of the Senate.