SEC. 2722. ENFORCEMENT.
Title[ Title I\Subtitle A\Sec. 102 Contents
<<NOTE: 42 USC 2722.>>
``(a) State Enforcement.--
``(1) State authority.--Subject to section 2723, each State
may require that health insurance issuers that issue, sell,
renew, or offer health insurance coverage in the State in the
small or large group markets meet the requirements of this part
with respect to such issuers.
``(2) Failure to implement provisions.--In the case of a
determination by the Secretary that a State has failed to
substantially enforce a provision (or provisions) in this part
with respect to health insurance issuers in the State, the
Secretary shall enforce such provision (or provisions) under
subsection (b) insofar as they relate to the issuance, sale,
renewal, and offering of health insurance coverage in connection
with group health plans in such State.
``(b) Secretarial Enforcement Authority.--
``(1) Limitation.--The provisions of this subsection shall
apply to enforcement of a provision (or provisions) of this part
only--
``(A) as provided under subsection (a)(2); and
``(B) with respect to group health plans that are
non-Federal governmental plans.
``(2) Imposition of penalties.--In the cases described in
paragraph (1)--
``(A) In general.--Subject to the succeeding
provisions of this subsection, any non-Federal
governmental plan that is a group health plan and any
health insurance issuer that fails to meet a provision
of this part applicable to such plan or issuer is
subject to a civil money penalty under this subsection.
``(B) Liability for penalty.--In the case of a
failure by--
``(i) a health insurance issuer, the issuer is
liable for such penalty, or
``(ii) a group health plan that is a non-
Federal governmental plan which is--
``(I) sponsored by 2 or more
employers, the plan is liable for such
penalty, or
``(II) not so sponsored, the
employer is liable for such penalty.
``(C) Amount of penalty.--
``(i) In general.--The maximum amount of
penalty imposed under this paragraph is $100 for
each day for each individual with respect to which
such a failure occurs.
``(ii) Considerations in imposition.--In
determining the amount of any penalty to be
assessed under this paragraph, the Secretary shall
take into account the previous record of
compliance of the entity being assessed with the
applicable provisions of this part and the gravity
of the violation.
``(iii) Limitations.--
``(I) Penalty not to apply where
failure not discovered exercising
reasonable diligence.--No civil money
penalty shall be imposed under this
paragraph on any failure during any
period for which it is established to
the satisfaction of the Secretary that
none of the entities against whom the
penalty would be imposed knew, or
exercising reasonable diligence would
have known, that such failure existed.
``(II) Penalty not to apply to
failures corrected within 30 days.--No
civil money penalty shall be imposed
under this paragraph on any failure if
such failure was due to reasonable cause
and not to willful neglect, and such
failure is corrected during the 30-day
period beginning on the first day any of
the entities against whom the penalty
would be imposed knew, or exercising
reasonable diligence would have known,
that such failure existed.
``(D) Administrative review.--
``(i) Opportunity for hearing.--The entity
assessed shall be afforded an opportunity for
hearing by the Secretary upon request made within
30 days after the date of the issuance of a notice
of assessment. In such hearing the decision shall
be made on the record pursuant to section 554 of
title 5, United States Code. If no hearing is
requested, the assessment shall constitute a final
and unappealable order.
``(ii) Hearing procedure.--If a hearing is
requested, the initial agency decision shall be
made by an administrative law judge, and such
decision shall become the final order unless the
Secretary modifies or vacates the decision. Notice
of intent to modify or vacate the decision of the
administrative law judge shall be issued to the
parties within 30 days after the date of the
decision of the judge. A final order which takes
effect under this paragraph shall be
subject to review only as provided under
subparagraph (E).
``(E) Judicial review.--
``(i) Filing of action for review.--Any entity
against whom an order imposing a civil money
penalty has been entered after an agency hearing
under this paragraph may obtain review by the
United States district court for any district in
which such entity is located or the United States
District Court for the District of Columbia by
filing a notice of appeal in such court within 30
days from the date of such order, and
simultaneously sending a copy of such notice by
registered mail to the Secretary.
``(ii) Certification of administrative
record.--The Secretary shall promptly certify and
file in such court the record upon which the
penalty was imposed.
``(iii) Standard for review.--The findings of
the Secretary shall be set aside only if found to
be unsupported by substantial evidence as provided
by section 706(2)(E) of title 5, United States
Code.
``(iv) Appeal.--Any final decision, order, or
judgment of the district court concerning such
review shall be subject to appeal as provided in
chapter 83 of title 28 of such Code.
``(F) Failure to pay assessment; maintenance of
action.--
``(i) Failure to pay assessment.--If any
entity fails to pay an assessment after it has
become a final and unappealable order, or after
the court has entered final judgment in favor of
the Secretary, the Secretary shall refer the
matter to the Attorney General who shall recover
the amount assessed by action in the appropriate
United States district court.
``(ii) Nonreviewability.--In such action the
validity and appropriateness of the final order
imposing the penalty shall not be subject to
review.
``(G) Payment of penalties.--Except as otherwise
provided, penalties collected under this paragraph shall
be paid to the Secretary (or other officer) imposing the
penalty and shall be available without appropriation and
until expended for the purpose of enforcing the
provisions with respect to which the penalty was
imposed.
``
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