Ending Patient Runaround Act
- Sponsor
- Rep. Cloud, Michael [R-TX-27]
- Committees
- Ways and Means Committee (primary)
- Last action
- Oct 26, 2026
Bottom line
The bill aims to empower individuals with greater financial flexibility through universal savings accounts and enhance patient rights, transparency, and competition within the healthcare system, but introduces substantial new regulatory burdens and potential fiscal impacts.
What it actually does
This bill establishes Universal Savings Accounts (USAs), a new tax-exempt savings vehicle, allowing individuals to contribute up to $10,000 annually with after-tax dollars, with all earnings and distributions being tax-free. Concurrently, it enacts significant reforms to health care, mandating increased transparency in prior authorizations and insurance contracts, requiring equivalent reimbursement for in-network and out-of-network providers, expanding catastrophic health plan eligibility, and imposing escalating penalties on health plans and providers for billing errors.
Proponents argue
Proponents argue that Universal Savings Accounts simplify and encourage personal savings for any purpose, offering flexibility and tax advantages to all Americans. They contend that the healthcare provisions will reduce patient frustration, increase access to care, lower costs through competition and transparency, and hold health insurers and providers accountable for billing accuracy and timely service.
Opponents contend
Critics may argue that Universal Savings Accounts could disproportionately benefit higher-income individuals and lead to significant federal revenue loss. Opponents of the healthcare provisions might contend that the extensive new mandates on health plans and providers will increase administrative costs, potentially leading to higher premiums, undermine managed care networks, and could result in unintended consequences for healthcare access and affordability.
The bill is relatively concise, allowing an informed reader to grasp its main provisions within a reasonable timeframe, though the interaction with existing tax and health law requires careful consideration.
Section 2(a), new Section 530A of the Internal Revenue Code of 1986
Establishment of Universal Savings Accounts (USAs)
This provision creates a new tax-exempt savings account, similar to an IRA or HSA, where individuals can contribute up to $10,000 annually (indexed for inflation) with after-tax dollars. All earnings and qualified distributions from these accounts are tax-free, and funds are nonforfeitable and can be rolled over between accounts for the same beneficiary.
Supporters argue
Supporters argue USAs simplify savings, encourage personal financial responsibility, and provide a flexible, tax-advantaged way for individuals to save for any purpose without restrictions on use, promoting broader financial well-being.
Critics contend
Critics may argue that USAs primarily benefit higher-income individuals who already have disposable income to save, potentially exacerbating wealth inequality, and could lead to significant federal revenue loss without clear societal benefits for lower-income groups.
Tradeoffs
This provision balances the goal of encouraging widespread personal savings and financial flexibility with potential impacts on federal tax revenue and equity concerns regarding who benefits most from tax-advantaged accounts.
Section 2(b)-(f)
Enforcement and Reporting for Universal Savings Accounts
These subsections establish the regulatory framework for Universal Savings Accounts by defining excess contributions subject to excise tax, specifying prohibited transactions, and mandating reporting requirements for account trustees to both the Secretary of the Treasury and the account beneficiary. These measures ensure compliance and oversight for the new savings vehicle.
Section 3(a), new Section 2730 of the Public Health Service Act
Timely and Transparent Prior Authorization
This provision mandates that group health plans and health insurance issuers must issue an approval or denial for prior authorization requests in writing to both the medical provider and patient, through a secure portal, within 30 days of receipt. If a denial leads to a peer-to-peer review, the reviewing peer must be in the same medical specialty as the requesting provider.
Section 3(b), new Section 2731 of the Public Health Service Act
Stability of Drug Tiers and Covered Services
This provision prohibits group health plans and health insurance issuers from making a prescription drug's tier more restrictive or changing the list of services not covered by the plan or coverage during the term of the coverage. This ensures that the terms of an insurance contract remain stable for the duration it is in effect.
Section 3(c), new Section 2732 of the Public Health Service Act
Enhanced Transparency in Insurance Contracts
This provision requires group health plans and health insurance issuers to include, with every copy of the insurance contract or benefits provided, the procedure code for each covered procedure, the amount the plan will charge for each such procedure, and a full list of all services and procedures covered by the plan.
Section 4(a), new Section 2733 of the Public Health Service Act
Equal Reimbursement for In-Network and Out-of-Network Providers
This provision prohibits health plans and issuers from restricting participating providers from furnishing services to individuals not enrolled in the plan. Crucially, it requires plans to pay non-participating providers for covered services at a rate not less than what the plan would have paid if those services had been furnished by a participating provider.
Section 4(b), amending Section 1302(e) of the Patient Protection and Affordable Care Act
Expansion of Catastrophic Health Plan Eligibility and Scope
This provision amends the Affordable Care Act to broaden the definition and eligibility for catastrophic health plans. It requires these plans to cover at least 3 primary care visits but no other benefits until the annual out-of-pocket limit is met (except for preventive services). It also removes the restriction that only certain qualified individuals (e.g., under 30 or with hardship exemptions) can enroll in catastrophic plans, making them more widely available.
Section 5(a), new Section 2734 of the Public Health Service Act
Dedicated Patient Point of Contact
This provision requires group health plans and health insurance issuers to provide each enrollee with the identity of at least one and at most three individuals who will serve as their dedicated point of contact. These contacts must be based in the United States and proficient in English, aiming to streamline patient interactions with their insurance provider.
Section 5(b), new Section 2735 of the Public Health Service Act
Penalties for Billing Errors
This provision requires health plans, issuers, and health care providers to provide monetary compensation to individuals for any error resulting in an overcharge. Compensation starts at 110% of the excess charge if returned within 30 days, escalates to 150% after 30-60 days, and further increases by 25 percentage points for each 30-day period beyond 60 days. The Secretary is also directed to prescribe additional penalties for providers failing to comply.
This subsection appears to be a near-identical duplicate of Section 2(b), both amending Section 4973 to apply excess contribution taxes to Universal Savings Accounts, but with a potential typo in the reference to the USA definition (530U vs 530A).
Section 2(c)
Why it matters:This is likely a drafting error rather than an intentional attempt to obscure a provision. Such redundancies can occur in complex legislative drafting.
Case for: If one of the subsections is intended to be correct, it ensures the proper application of excess contribution penalties to Universal Savings Accounts, which is a standard feature for tax-advantaged accounts.
Case against: The duplication and potential typo create ambiguity in the statutory language and could lead to confusion for the IRS and taxpayers regarding the precise legal reference for excess contributions.
Estimated impact: Minimal direct impact on policy if one is simply a redundant error, but could cause legal or administrative confusion during implementation.
The bill's provisions have staggered effective dates: Universal Savings Accounts apply to taxable years beginning after December 31, 2024; catastrophic health plan changes take effect for plans beginning in calendar year 2027; and most other health care amendments take effect on January 1, 2029.
Section 2(g), Section 4(b)(3), Section 6
Why it matters:This is standard legislative practice to tailor effective dates to specific provisions, allowing adequate time for agencies and regulated entities to prepare for implementation or aligning with specific fiscal or plan years.
Case for: Allows for phased implementation, giving agencies and regulated entities sufficient time to develop necessary regulations, update systems, and train staff for complex changes, and aligns tax changes with upcoming tax years.
Case against: Could create confusion for stakeholders trying to understand precisely when specific provisions apply, especially with multiple, distinct effective dates for different parts of the bill.
Estimated impact: Affects the timeline of all policy changes, influencing when benefits and burdens are realized by affected groups.
For inflation adjustments to the $10,000 Universal Savings Account contribution limit, if any increase is not a multiple of $100, the amount 'shall be rounded to the next lower multiple of $100.'
Section 2(a), new Section 530A(c)(1)(B) of the Internal Revenue Code of 1986
Why it matters:While providing a clear, consistent method for rounding, specifying 'next lower' is less common than rounding to the nearest multiple or rounding up for benefit/contribution limits in tax code, which could subtly depress the real value of the limit over time. It may be a deliberate choice to manage future tax expenditure growth.
Case for: Provides a clear and consistent method for rounding inflation adjustments, which can simplify administrative calculations for the IRS and financial institutions.
Case against: Rounding down rather than to the nearest multiple or rounding up could slightly reduce the real value of the contribution limit over time compared to other indexing methods, potentially diminishing the long-term benefit for savers.
Estimated impact: Minor on an annual basis, but cumulatively could slightly reduce the tax benefit for savers over many years compared to alternative rounding rules.
The bill delegates authority to the Secretary (presumably of Health and Human Services) to 'by regulation prescribed penalties in the case of a health care provider that fails to comply with the preceding sentence' regarding monetary compensation for billing errors.
Section 5(b), new Section 2735 of the Public Health Service Act
Why it matters:This is a common legislative practice to delegate rulemaking authority to an executive agency for specific implementation details. However, it grants the Secretary significant power to define the enforcement mechanism and specific penalties for providers without direct statutory limits.
Case for: Allows the Secretary flexibility to develop appropriate and adaptable penalties for providers, ensuring effective enforcement of billing accuracy without rigid statutory constraints that might become outdated.
Case against: Delegates significant authority to an executive agency to define penalties, potentially leading to regulations that are perceived as overly burdensome or insufficient, without direct congressional approval of the specific penalty structure.
Estimated impact: The actual financial and operational impact on health care providers will depend heavily on the specific regulations promulgated by the Secretary, which are not detailed in the bill.