TABLE OF CONTENTS:
Title I: Expansion of the State Children's Health Insurance
Program
Title II: Expanded Health Services for Disabled Individuals
Title III: Health Care Insurance Coverage
Subtitle A: General Provisions
Subtitle B: Tax Provisions
Title IV: Primary and Preventive Care Services
Title V: Patient's Right to Decline Medical Treatment
Title VI: Primary and Preventive Care Providers
Title VII: Cost Containment
Title VIII: Tax Incentives for Purchase of Qualified
Long-Term Care Insurance
Title IX: National Fund for Health Research
Health Care Assurance Act of 1999 - Title I: Expansion of the State Children's Health Insurance Program - Amends title XX (Block Grants to States for Social Services) of the Social Security Act (SSA) with respect to the definition of a low-income child for the State children's health insurance program, to raise the family income eligibility threshold from a maximum 200 percent to a maximum 235 percent of the poverty line for a family of the size involved.
Title II: Expanded Health Services for Disabled Individuals - Amends SSA title II (Old Age, Survivors and Disability Insurance (OASDI)) to extend to 24 months the period of Medicare coverage after returning to work for recipients of OASDI disability benefits. Provides for such recipients to "buy-into" Medicare at a reduced rate, subject to annual review.
(Sec. 202) Amends SSA title XIX (Medicaid) to require a State to permit an individual entitled to Medicaid for nursing facility services or intermediate care facility services for the mentally retarded to choose to receive medical assistance for qualified community-based attendant services (rather than institutional services), in the most integrated setting appropriate to the individual's needs, so long as the aggregate amount of Federal expenditures for such individuals in a fiscal year does not exceed the total that would have been expended for them to receive institutional services, plus a specified decreasing transitional allotment each fiscal year between FY 2000 and 2005. Allows for reimbursement for such services without regard to the recipient's age or the nature of the disability.
Requires a State to develop a long-term care services transition plan to increase the proportion of such services provided in home and community-based, rather than institutional, settings.
Requires the Secretary of Health and Human Services to: (1) report to Congress on how excessive utilization of medical services can be reduced by using qualified community-based attendant services; (2) develop an instrument to assess the functional needs of an individual for qualified community-based attendant services; and (3) establish a task force to examine appropriate methods of financing long-term care services.
(Sec. 203) Amends SSA title XIX (Medicaid) to authorize a State to: (1) waive the income limitation on Medicaid eligibility for any individual for whom it finds the potential for employment opportunities would be enhanced through the provision of certain medical services; and (2) impose on such an individual a premium based on an income-related sliding scale.
Title III: Health Care Insurance Coverage - Subtitle A: General Provisions - Amends the Employee Retirement Income Security Act of 1974 (ERISA) and the Public Health Service Act (PHSA) to mandate: (1) a set of rules for determining the actuarial value of the coverage offered by a plan or group health insurance coverage; and (2) a target actuarial value. Includes coverage for medical and surgical services, medical equipment, preventive services, and emergency transportation in frontier areas (standard coverage).
(Secs. 301 and 302) Mandates model regulations specifying standards for making qualified group health plans available to small employers. Allows a State to implement more stringent standards, so long as the State standards do not prevent the offering of at least one plan that provides standard coverage.
Requires each group plan offered, and issuer offering group coverage, to a small employer to establish a standard premium in each community rating area. Requires each State to divide the State into one or more community rating areas. Prescribes requirements for premiums. Provides for the treatment of rates negotiated with a small employer purchasing group in a rating area.
Mandates full disclosure of rating practices.
Provides for State certification of small employer purchasing groups. Prescribes requirements for such groups. Provides for payroll deductions for premiums.
Requires each such group to offer eligible employees, eligible individuals, and certain uninsured individuals the opportunity to enroll in any qualified group health plan that has an agreement with the group. Prescribes requirements for premiums.
Requires each such group to market plans to members through the entire community rating area served by the group.
Mandates grants to States and small employer purchasing groups to assist in planning, developing, and operating such groups. Authorizes appropriations.
Authorizes a State to establish a system in all or part of the State under which the groups are the sole mechanism through which coverage for employees of small employers may be purchased or provided.
Requires each small employer (except new and very small employers) to make available to each eligible employee a group health plan providing at least standard coverage, with a specified maximum waiting period allowed. Declares that employer cost contributions are not required. Allows the requirement to be met through a multiemployer plan.
Applies the requirements of this title to a multiemployer plan that is maintained by an organization such as a trade, industry, or professional association, a chamber of commerce, a religious organization, or a public entity association. Requires that a plan be certified by the Secretary. Sets forth special rules for church plans, plans maintained by a health plan sponsor, or plans maintained by a rural electric or rural telephone cooperative.
(Sec. 303) Amends the PHSA to apply the provisions of this title to coverage offered in the individual market.
Subtitle B: Tax Provisions - Amends the Internal Revenue Code to impose taxes on the failure to comply with this title's requirements by a health insurance issuer, any small employer, or a qualified association, church plan, multiemployer plan, or plan maintained by a rural electric or telephone cooperative.
(Sec. 314) Allows self-employed individuals to deduct 100 percent of their health insurance costs in 2001 and thereafter.
(Sec. 315) Amends the Internal Revenue Code, ERISA, and PHSA to: (1) provide for group health plan continuation (COBRA) coverage; (2) modify the requirements regarding the period of continuation coverage; and (3) make a special rule for dependent children, extending COBRA coverage until 36 months after a child ceases to be dependent.
Title IV: Primary and Preventive Care Services - Amends SSA title XVIII (Medicare) to cover: (1) annual pap smears, pelvic exams, and mammography screening for women, with no copayment or Part B deductible; and (2) insulin pumps for the computerized delivery of insulin to certain Type I diabetics in lieu of multiple daily manual insulin injections.
(Sec. 402) Authorizes appropriations to carry out the healthy start program under PHSA relating to research and investigations generally, requiring reservation of specified amounts for model projects.
(Sec. 403) Amends PHSA to authorize appropriations for: (1) preventive health service immunization programs; (2) the prevention and control of sexually transmitted diseases; (3) family planning projects; (4) breast and cervical cancer programs; and (5) preventive health and health services block grants.
Amends title V (Maternal and Child Health Services Block Grants) of the Social Security Act to authorize appropriations.
(Sec. 404) Mandates grants to States to enable them to: (1) make grants to establish, operate, and improve local programs of comprehensive health education and prevention, early health intervention, and health education in elementary and secondary schools; and (2) develop related training, technical assistance, and coordination.
Establishes in the Office of the Secretary of Education the Office of Comprehensive School Health Education. Authorizes appropriations.
(Sec. 405) Mandates a program of grants to agencies conducting Head Start training for training and technical assistance to Head Start teachers and other child care providers. Authorizes appropriations.
(Sec. 406) Amends PHSA to make abstinence information a necessary service of adolescent family life demonstration projects. Requires demonstration project grants, as much as practicable, to ensure adequate urban and rural area representation. Mandates a simplified and expedited application process for applicants seeking less than a specified amount of funds. Authorizes appropriations to carry out adolescent family life demonstration projects.
Title V: Patient's Right to Decline Medical Treatment - Prohibits State restrictions, except to protect a third party, on the right: (1) of a competent adult to consent to or decline medical treatment; or (2) of an incapacitated person to consent to or decline medical treatment through a power of attorney or similar document. Mandates development of national advance directive and durable power of attorney forms and requires all health care providers to honor such forms. Shields providers who act in good faith from criminal or civil liability or professional discipline. Denies Medicare and Medicaid payment for services contrary to the adult's wishes.
Title VI: Primary and Preventive Care Providers - Amends SSA title XVIII (Medicare) to increase from 85 percent to 90 percent of the physicians' services fee schedule a specified portion of the formula for the Medicare reimbursement for physician assistants, nurse practitioners, and clinical nurse specialists.
(Sec. 602) Amends title XIX (Medicaid) of the Social Security Act to include physician assistants, nurse practitioners, clinical nurse specialists, and certified registered nurse anesthetists in the definition of "medical assistance" for which payment will be made.
(Sec. 603) Amends PHSA to establish grant programs to: (1) provide medical (including osteopathic) students for programs to interest high school or college students in careers in general medical practice; and (2) develop strategies for recruiting and placing medical students interested in practicing general medicine. Authorizes appropriations.
Title VII: Cost Containment - Authorizes a program of clinical trials regarding promising new drugs and disease treatments. Authorizes appropriations.
(Sec. 702) Authorizes appropriations for the Agency for Health Care Policy Research.
Amends the Internal Revenue Code to impose a tax on health insurance premiums, payable by any person who makes, signs, issues, or sells any of the documents and instruments subject to the tax or for whose use or benefit the same are made, signed, issued, or sold. Establishes, and deposits the resulting tax receipts in, the Trust Fund for Medical Treatment Outcomes Research. Mandates annual Trust Fund distributions for outcomes research.
(Sec. 703) Mandates grants to States that establish health care cost containment and quality information systems. Authorizes appropriations.
Title VIII: Tax Incentives for Purchase of Qualified Long-Term Care Insurance - Allows a credit for a percentage of premiums for a long-term care insurance contract.
(Sec. 802) Makes the currently excluded long-term care insurance a "qualified benefit" for cafeteria plans. Excludes from an employee's gross income (the currently included) employer-provided coverage for long-term care.
(Sec. 803) Excludes from gross income amounts from the whole or partial surrender, cancellation, or exchange of any life insurance contract if the amount is used to pay for any qualified long-term care insurance contract and other requirements are met. Declares that no gain or loss shall be recognized on the exchange of a life insurance or annuity contract for a long-term care contract if certain requirements are met.
(Sec. 804) Makes a home equity conversion sale-leaseback transaction eligible for the one-time exclusion from gain from the sale of a principal residence if a portion of the proceeds is used to purchase a qualified long-term care contract and other requirements are met.
Title IX: National Fund for Health Research - Amends PHSA to establish the National Fund for Health Research, consisting of certain amounts set aside from health plan premiums and interest on those amounts. Requires distribution of all amounts available in the Fund in a fiscal year to the institutes and centers of the National Institutes of Health in certain proportions. Excludes the Fund from any budget enforcement procedure under the Congressional Budget Act of 1974 or the Balanced Budget and Emergency Deficit Control Act of 1985 (Gramm-Rudman-Hollings Act).
[Congressional Bills 106th Congress]
[From the U.S. Government Printing Office]
[S. 24 Introduced in Senate (IS)]
106th CONGRESS
1st Session
S. 24
To provide improved access to health care, enhance informed individual
choice regarding health care services, lower health care costs through
the use of appropriate providers, improve the quality of health care,
improve access to long-term care, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
January 19, 1999
Mr. Specter introduced the following bill; which was read twice and
referred to the Committee on Finance
_______________________________________________________________________
A BILL
To provide improved access to health care, enhance informed individual
choice regarding health care services, lower health care costs through
the use of appropriate providers, improve the quality of health care,
improve access to long-term care, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Health Care
Assurance Act of 1999''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
TITLE I--EXPANSION OF THE STATE CHILDREN'S HEALTH INSURANCE PROGRAM
Sec. 101. Increase in income eligibility.
TITLE II--EXPANDED HEALTH SERVICES FOR DISABLED INDIVIDUALS
Sec. 201. Extension of medicare eligibility for disabled individuals
who return to work.
Sec. 202. Coverage of community-based attendant services under the
medicaid program.
Sec. 203. State option for medicaid eligibility for certain
individuals.
TITLE III--HEALTH CARE INSURANCE COVERAGE
Subtitle A--General Provisions
Sec. 301. Amendments to the Employee Retirement Income Security Act of
1974.
``Subpart C--General Insurance Coverage Reforms
``CHAPTER 1--INCREASED AVAILABILITY AND CONTINUITY OF HEALTH COVERAGE
``Sec. 721. Definition.
``Sec. 721A. Actuarial equivalence in benefits permitted.
``Sec. 721B. Establishment of plan standards.
``Sec. 721C. Rating limitations for community-rated market.
``Sec. 721D. Rating practices and payment of premiums.
``Sec. 721E. Qualified small employer purchasing groups.
``Sec. 721F. Agreements with small employers.
``Sec. 721G. Enrolling eligible employees, eligible
individuals, and certain uninsured
individuals in qualified group health
plans.
``Sec. 721H. Receipt of premiums.
``Sec. 721I. Marketing activities.
``Sec. 721J. Grants to States and qualified small employer
purchasing groups.
``Sec. 721K. Qualified small employer purchasing groups
established by a State.
``Sec. 721L. Effective dates.
``CHAPTER 2--REQUIRED COVERAGE OPTIONS FOR ELIGIBLE EMPLOYEES AND
DEPENDENTS OF SMALL EMPLOYERS
``Sec. 722. Requiring small employers to offer coverage for
eligible individuals.
``Sec. 722A. Compliance with applicable requirements through
multiple employer health arrangements.
``CHAPTER 3--REQUIRED COVERAGE OPTIONS FOR INDIVIDUALS INSURED THROUGH
ASSOCIATION PLANS
``Subchapter A--Qualified Association Plans
``Sec. 723. Treatment of qualified association plans.
``Sec. 723A. Qualified association plan defined.
``subchapter b--special rule for church, multiemployer, and cooperative
plans
``Sec. 723F. Special rule for church, multiemployer, and
cooperative plans.
Sec. 302. Amendments to the Public Health Service Act relating to the
group market.
``subchapter a--increased availability and continuity of health
coverage
``Sec. 2707. Definition.
``Sec. 2707A. Actuarial equivalence in benefits permitted.
``Sec. 2707B. Establishment of plan standards.
``Sec. 2707C. Rating limitations for community-rated market.
``Sec. 2707D. Rating practices and payment of premiums.
``Sec. 2707E. Qualified small employer purchasing groups.
``Sec. 2707F. Agreements with small employers.
``Sec. 2707G. Enrolling eligible employees, eligible
individuals, and certain uninsured
individuals in qualified group health
plans.
``Sec. 2707H. Receipt of premiums.
``Sec. 2707I. Marketing activities.
``Sec. 2707J. Grants to States and qualified small employer
purchasing groups.
``Sec. 2707K. Qualified small employer purchasing groups
established by a State.
``subchapter b--required coverage options for eligible employees and
dependents of small employers
``Sec. 2708. Requiring small employers to offer coverage for
eligible individuals.
``Sec. 2708A. Compliance with applicable requirements through
``subchapter c--required coverage options for individuals insured
through association plans
``Sec. 2709. Treatment of qualified association plans.
``Sec. 2709A. Qualified association plan defined.
``Sec. 2709B. Definitions and special rules.
``Sec. 2709C. Special rule for church, multiemployer, and
cooperative plans.
Sec. 303. Amendment to the Public Health Service Act relating to the
individual market.
``Sec. 2753. Applicability of general insurance market reforms.
Sec. 304. Effective date.
Subtitle B--Tax Provisions
Sec. 311. Enforcement with respect to health insurance issuers.
``Sec. 4980F. Failure of insurer to comply with certain
standards for health insurance coverage.
Sec. 312. Enforcement with respect to small employers.
Sec. 313. Enforcement by excise tax on qualified associations.
Sec. 314. Deduction for health insurance costs of self-employed
individuals.
Sec. 315. Amendments to COBRA.
TITLE IV--PRIMARY AND PREVENTIVE CARE SERVICES
Sec. 401. Improvement of medicare preventive care services.
Sec. 402. Authorization of appropriations for healthy start program.
Sec. 403. Reauthorization of certain programs providing primary and
preventive care.
Sec. 404. Comprehensive school health education program.
Sec. 405. Comprehensive early childhood health education program.
Sec. 406. Adolescent family life and abstinence.
TITLE V--PATIENT'S RIGHT TO DECLINE MEDICAL TREATMENT
Sec. 501. Patient's right to decline medical treatment.
TITLE VI--PRIMARY AND PREVENTIVE CARE PROVIDERS
Sec. 601. Increased medicare reimbursement for physician assistants,
nurse practitioners, and clinical nurse
specialists.
Sec. 602. Requiring coverage of certain nonphysician providers under
the medicaid program.
Sec. 603. Medical student tutorial program grants.
Sec. 604. General medical practice grants.
TITLE VII--COST CONTAINMENT
Sec. 701. New drug clinical trials program.
Sec. 702. Medical treatment effectiveness.
Sec. 703. Health care cost containment and quality information program.
TITLE VIII--TAX INCENTIVES FOR PURCHASE OF QUALIFIED LONG-TERM CARE
INSURANCE
Sec. 801. Credit for qualified long-term care premiums.
Sec. 802. Inclusion of qualified long-term care insurance in cafeteria
plans and flexible spending arrangements.
Sec. 803. Exclusion from gross income for amounts received on
cancellation of life insurance policies and
used for qualified long-term care insurance
contracts.
Sec. 804. Use of gain from sale of principal residence for purchase of
qualified long-term health care insurance.
TITLE IX--NATIONAL FUND FOR HEALTH RESEARCH
Sec. 901. Establishment of Fund.
TITLE I--EXPANSION OF THE STATE CHILDREN'S HEALTH INSURANCE PROGRAM
SEC. 101. INCREASE IN INCOME ELIGIBILITY.
(a) Definition of Low-Income Child.--Section 2110(c)(4) of the
Social Security Act (42 U.S.C. 42 U.S.C. 1397jj(c)(4)) is amended by
striking ``200'' and inserting ``235''.
(b) Effective Date.--The amendment made by subsection (a) takes
effect on October 1, 1999.
TITLE II--EXPANDED HEALTH SERVICES FOR DISABLED INDIVIDUALS
SEC. 201. EXTENSION OF MEDICARE ELIGIBILITY FOR DISABLED INDIVIDUALS
WHO RETURN TO WORK.
(a) Additional 24 Months of Medicare Coverage for OASDI Disability
Benefit Recipients who are Working.--The next to last sentence of
section 226(b) of the Social Security Act (42 U.S.C. 426(b)) is
amended--
(1) by striking ``throughout all of which'' and inserting
``throughout the first 24 months of which''; and
(2) by inserting after ``but not in excess of 24 such
months'' the following: ``(plus 24 additional such months in
the case of an individual who the Commissioner determines would
otherwise be entitled to hospital insurance benefits under part
A of title XVIII but for the individual having earnings that
exceed the substantial gainful activity amount (as defined in
section 223(d)(4)))''.
(b) Medicare Buy-In for OASDI Disability Benefit Recipients who are
Working.--
(1) In general.--Section 1818A(d) of the Social Security
Act (42 U.S.C. 1395i-2a(d)) is amended by adding at the end the
following:
``(3)(A) In the case of an individual described in subparagraph
(B), the monthly premium for a month shall be paid for in the following
manner:
``(i) If the individual's income does not exceed 150
percent of the income official poverty line (as defined by the
Office of Management and Budget, and revised annually in
accordance with section 673(2) of the Omnibus Budget
Reconciliation Act of 1981), 100 percent by the State of the
individual's residence under the medicaid program under title
XIX.
``(ii) If the individual's income exceeds 150 but does not
exceed 185 percent of the income official poverty line (as so
defined), 75 percent by such State under the medicaid program
under title XIX and 25 percent by the individual.
``(iii) If the individual's income exceeds 185 but does not
exceed 200 percent of the income official poverty line (as so
defined), 50 percent by such State under the medicaid program
under title XIX and 50 percent by the individual.
``(B) An individual is described in this subparagraph if--
``(i) the individual establishes to the satisfaction of the
Secretary, subject to an annual review, that the individual
continues to satisfy the enrollment requirements of subsection
(a);
``(ii) the individual is not eligible for assistance with
payment of premiums for enrollment in the insurance program
established by this part or with payment of other cost-sharing
imposed under this part under title XIX, other than under
section 1902(a)(10)(E)(v), or under any other Federal or State
assistance program; and
``(iii) the individual's income does not exceed 200 percent
of the income official poverty line (as so defined).
``(C) Nothing in this paragraph shall be construed as exempting an
individual described in subparagraph (B) from being subject to any
requirements relating to cost-sharing that are imposed under the
insurance program established under this part.''.
(2) Medicaid payment for coverage.--Section 1902(a)(10)(E)
of the Social Security Act (42 U.S.C. 1396a(a)(10)(E)) is
amended--
(A) in clause (iii), by striking ``and'' at the
end; and
(B) by adding at the end the following:
``(v) for making medical assistance available for
payment of medicare cost-sharing described in section
1905(p)(3)(A)(i) in accordance with section
1818A(d)(3)(A) for individuals described in section
1818A(d)(3)(B); and''
(3) Effective Date.--The amendments made by this section
take effect October 1, 1999.
SEC. 202. COVERAGE OF COMMUNITY-BASED ATTENDANT SERVICES UNDER THE
MEDICAID PROGRAM.
(a) Requiring Coverage for Individuals Entitled to Nursing Facility
Services or Intermediate Care Facility Services for the Mentally
Retarded.--Section 1902(a)(10)(D) of the Social Security Act (42 U.S.C.
1396a(a)(10)(D)) is amended--
(1) by inserting ``(i)'' after ``(D)'', and
(2) by adding at the end the following:
``(ii) subject to section 1935(b), for the
inclusion of qualified community-based attendant
services for any individual who, under the State plan,
is entitled to nursing facility services or
intermediate care facility services for the mentally
retarded and who requires such services based on
functional need (and without regard to age or
disability);''.
(b) Medicaid Coverage of Community-Based Attendant Services.--
(1) In general.--Title XIX of the Social Security Act (42
U.S.C. 1396 et seq.) is amended--
(A) by redesignating section 1935 as section 1936,
and
(B) by inserting after section 1934 the following
new section:
``coverage of qualified community-based attendant services
``Sec. 1935. (a) Qualified Community-Based Attendant Services
Defined.--
``(1) In general.--In this title, the term `qualified
community-based attendant services' means attendant services
(as defined by the Secretary) furnished to an individual--
``(A) on an as-needed basis under a plan of service
that is based on an assessment of functional need and
that is agreed to by the individual;
``(B) in a home or community-based setting, which
may include a school, workplace, or recreation or
religious facility, but does not include a nursing
facility, an intermediate care facility for the
mentally retarded, or other institutional facility;
``(C) under either an agency-provider model or
other model (as defined in subsection (c)); and
``(D) the furnishing of which is selected, managed,
controlled by the individual (as defined by the
Secretary).
``(2) Services included.--Such term includes--
``(A) backup and emergency attendant services;
``(B) voluntary training on how to select, manage,
and dismiss attendants; and
``(C) health-related tasks (as defined by the
Secretary) that are assigned to, delegated to, or
performed by, unlicensed personal attendants.
``(3) Excluded services.--Subject to paragraph (4), such
term does not include--
``(A) provision of room and board, and
``(B) prevocational, vocational, and supported
employment.
``(4) Flexibility in transition to home setting.--Under
regulations of the Secretary, such term may include
expenditures for transitional costs, such as rent and utility
deposits, first months's rent and utilities, bedding, basic
kitchen supplies, and other necessities required for an
individual to make the transition from a nursing facility or
intermediate care facility for the mentally retarded to a home
setting.
``(b) Limitation on Amounts of Expenditures as Medical
Assistance.--
``(1) In general.--In carrying out section
1902(a)(10)(D)(ii), a State shall permit an individual who is
entitled to medical assistance with respect to nursing facility
services or intermediate care facility services for the
mentally retarded and who qualifies for the receipt of such
services to choose to receive medical assistance for qualified
community-based attendant services (rather than medical
assistance for such institutional services), in the most
integrated setting appropriate to the needs of the individual,
so long as the aggregate amount of the Federal expenditures for
such individuals in a fiscal year does not exceed the total
that would have been expended for such individuals to receive
such institutional services in the year plus, subject to
subsection (e), the transitional allotment to the State for the
fiscal year involved, as determined under paragraph (2)(B).
``(2) Transitional allotments.--
``(A) Total amount.--The total amount of the
transitional allotments under this paragraph for--
``(i) fiscal year 2000 is $580,000,000,
``(ii) fiscal year 2001 is $480,000,000,
``(iii) fiscal year 2002 is $380,000,000,
``(iv) fiscal year 2003 is $280,000,000,
``(v) fiscal year 2004 is $180,000,000 and
``(vi) fiscal year 2005 is $100,000,000.
``(B) State allotments.--The Secretary shall
provide a formula for the distribution of the total
amount of the transitional allotments provided in each fiscal year
under subparagraph (A) among States. Such formula shall give preference
to States that have a relatively higher proportion of long-term care
services furnished to individuals in an institutional setting but who
have a plan under subsection (e) to significantly reduce such
proportion.
``(C) Use of funds.--Such funds allotted to, but
not expended in, a fiscal year to a State are available
for expenditure in the succeeding fiscal year.
``(c) Delivery Models.--For purposes of this section:
``(1) Agency-provider model.--The term `agency-provider
model' means, with respect to the provision of community-based
attendant services for an individual, a method of providing
such services under which a single entity contracts for the
provision of such services.
``(2) Other model.--The term `other model' means a method,
other than an agency-provider model, for provision of services.
Such a model may include the provision of vouchers, direct cash
payments, or use of a fiscal agent to assist in obtaining
services.
``(d) Quality Assurance.--
``(1) In general.--No Federal financial participation shall
be available with respect to qualified community-based
attendant services furnished under an agency-provider model or
other model unless the State establishes and maintains a
quality assurance program that is developed after public
hearings, that is based on consumer satisfaction, and that, in
the case of services furnished under the agency-provider model,
meets the following requirements:
``(A) Survey and certification.--The State
periodically certifies and surveys such provider-
agencies. Such surveys are conducted on an unannounced
basis and average at least 1 a year for each agency-
provider.
``(B) Standards.--The State adopts standards for
survey and certification that include--
``(i) minimum qualifications and training
requirements for provider staff;
``(ii) financial operating standards; and
``(iii) a consumer grievance process.
``(C) Monitoring boards.--The State provides a
system that allows for monitoring boards consisting of
providers, family members, consumers, and neighbors to
advise and assist the State.
``(D) Public reporting.--The State establishes
reporting procedures to make available information to
the public.
``(E) Ongoing monitoring.--The State provides
ongoing monitoring of the delivery of attendant
services and the effect of those services on the health
and well-being of each recipient.
``(2) Protection of beneficiaries.--
``(A) In general.--The regulations promulgated
under section 1930(h)(1) shall apply with respect to
the protection of the health, safety, and welfare of
individuals receiving qualified community-based
attendant services in the same manner as they apply to
individuals receiving community supported living
arrangements services.
``(B) Development of additional regulations.--The
Secretary shall develop additional regulations to
protect the health, safety, and welfare for individuals
receiving qualified community-based attendant services
other than under an agency-provider model. Such
regulations shall be designed to maximize the
consumers' independence and control.
``(C) Sanctions.--The provisions of section
1930(h)(2) shall apply to violations of regulations
described in subparagraph (A) or (B) in the same manner
as they apply to violations of regulations described in
section 1930(h)(1).
``(e) Transition Plan.--
``(1) In general.--As a condition for receipt of a
transitional allotment under subsection (b)(2), a State shall
develop a long-term care services transition plan that
establishes specific action steps and specific timetables to
increase the proportion of long-term care services provided
under the plan under this title in home and community-based
settings, rather than institutional settings.
``(2) Participation.--The plan under paragraph (1) shall be
developed with major participation by both the State
Independent Living Council and the State Developmental
Disabilities Council, as well as input from the Councils on
Aging.
``(f) Eligibility.--Effective January 1, 2001, a State may not
exercise the option of coverage of individuals under section
1902(a)(10)(A)(ii)(V) without providing coverage under section
1902(a)(10)(A)(ii)(VI).
``(g) Report on Impact of Section.--The Secretary shall submit to
Congress periodic reports on the impact of this section on
beneficiaries, States, and the Federal Government.''.
(c) Coverage as Medical Assistance.--
(1) In general.--Section 1905(a) of the Social Security Act
(42 U.S.C. 1396d) is amended--
(A) by striking ``and'' at the end of paragraph
(26),
(B) by redesignating paragraph (27) as paragraph
(28), and
(C) by inserting after paragraph (26) the following
new paragraph:
``(27) qualified community-based attendant services (to the
extent allowed and as defined in section 1935); and''.
(2) Eligibility classifications.--Section
1902(a)(10)(A)(ii)(VI) of the Social Security Act (42 U.S.C.
1396a(a)(10)(A)(ii)(VI)) is amended by inserting ``or qualified
community-based attendant services'' after ``section 1915''
each time such term appears.
(3) Conforming amendments.--
(A) Section 1902(j) of the Social Security Act (42
U.S.C. 1396a(j)) is amended by striking ``of of'' and
inserting ``of''.
(B) Section 1902(a)(10)(C)(iv) of the Social
Security Act (42 U.S.C. 1396a(a)(10)(C)(iv)) is amended
by inserting ``and (27)'' after ``(24)''.
(d) Review of, and Report on, Regulations.--The Secretary of Health
and Human Services shall review existing regulations under title XIX of
the Social Security Act (42 U.S.C. 1396 et seq.) insofar as they
regulate the provision of home health services and other services in
home and community-based settings. The Secretary shall submit to
Congress a report on how excessive utilization of medical services can
be reduced under such title by using qualified community-based
attendant services.
(e) Development of Functional Needs Assessment Instrument.--The
Secretary of Health and Human Services shall develop a functional needs
assessment instrument that assesses an individual's need for qualified
community-based attendant services and that may be used in carrying out
sections 1902(a)(10)(D)(ii) and 1935 of the Social Security Act.
(f) Task Force on Financing of Long-Term Care Services.--The
Secretary of Health and Human Services shall establish a task force to
examine appropriate methods for financing long-term care services. Such
task force shall include significant representation of individuals (and
representatives of individuals) who receive such services.
(g) Effective Date.--The amendments made by subsections (a), (b),
and (c) shall apply to medical assistance provided for items and
services furnished on or after January 1, 2000.
SEC. 203. STATE OPTION FOR MEDICAID ELIGIBILITY FOR CERTAIN
INDIVIDUALS.
(a) In General.--Section 1903(f) of the Social Security Act (42
U.S.C. 1396b(f)) is amended--
(1) in paragraph (4)(C), by inserting ``subject to
paragraph (5),'' after ``does not exceed'', and
(2) by adding at the end the following:
``(5)(A) A State may waive the income limitation described in
paragraph (4)(C) in such cases as the State finds the potential for
employment opportunities would be enhanced through the provision of
such services.
``(B) In the case of an individual who is made eligible for medical
assistance because of subparagraph (A), notwithstanding section
1916(b), the State may impose a premium based on a sliding scale
relating to income.''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to medical assistance provided for items and services furnished
on or after January 1, 2000.
TITLE III--HEALTH CARE INSURANCE COVERAGE
Subtitle A--General Provisions
SEC. 301. AMENDMENTS TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974.
(a) In General.--Part 7 of subtitle B of title I of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1181 et seq.) is
amended--
(1) by redesignating subpart C as subpart D; and
(2) by inserting after subpart B, the following:
``Subpart C--General Insurance Coverage Reforms
``CHAPTER 1--INCREASED AVAILABILITY AND CONTINUITY OF HEALTH COVERAGE
``SEC. 721. DEFINITION.
``As used in this subpart, the term `qualified group health plan'
means a group health plan, and a health insurance issuer offering group
health insurance coverage, that is designed to provide standard
coverage (consistent with section 721A(b)).
``SEC. 721A. ACTUARIAL EQUIVALENCE IN BENEFITS PERMITTED.
``(a) Set of Rules of Actuarial Equivalence.--
``(1) Initial determination.--The NAIC is requested to
submit to the Secretary, within 6 months after the date of the
enactment of this subpart, a set of rules which the NAIC
determines is sufficient for determining, in the case of any
group health plan, or a health insurance issuer offering group
health insurance coverage, and for purposes of this section,
the actuarial value of the coverage offered by the plan or
coverage.
``(2) Certification.--If the Secretary determines that the
NAIC has submitted a set of rules that comply with the
requirements of paragraph (1), the Secretary shall certify such
set of rules for use under this subpart. If the Secretary
determines that such a set of rules has not been submitted or
does not comply with such requirements, the Secretary shall
promptly establish a set of rules that meets such requirements.
``(b) Standard Coverage.--
``(1) In general.--A group health plan, and a health
insurance issuer offering group health insurance coverage,
shall be considered to provide standard coverage consistent
with this subsection if the benefits are determined, in
accordance with the set of actuarial equivalence rules
certified under subsection (a), to have a value that is within
5 percentage points of the target actuarial value for standard
coverage established under paragraph (2).
``(2) Initial determination of target actuarial value for
standard coverage.--
``(A) Initial determination.--
``(i) In general.--The NAIC is requested to
submit to the Secretary, within 6 months after
the date of the enactment of this subpart, a
target actuarial value for standard coverage
equal to the average actuarial value of the
coverage described in clause (ii). No specific
procedure or treatment, or classes thereof, is
required to be considered in such determination
by this subpart or through regulations. The
determination of such value shall be based on a
representative distribution of the population
of eligible employees offered such coverage and
a single set of standardized utilization and
cost factors.
``(ii) Coverage described.--The coverage
described in this clause is coverage for
medically necessary and appropriate services
consisting of medical and surgical services,
medical equipment, preventive services, and
emergency transportation in frontier areas. No
specific procedure or treatment, or classes
thereof, is required to be covered in such a
plan, by this subpart or through regulations.
``(B) Certification.--If the Secretary determines
that the NAIC has submitted a target actuarial value
for standard coverage that complies with the
requirements of subparagraph (A), the Secretary shall
certify such value for use under this chapter. If the
Secretary determines that a target actuarial value has
not been submitted or does not comply with the
requirements of subparagraph (A), the Secretary shall
promptly determine a target actuarial value that meets
such requirements.
``(c) Subsequent Revisions.--
``(1) NAIC.--The NAIC may submit from time to time to the
Secretary revisions of the set of rules of actuarial
equivalence and target actuarial values previously established
or determined under this section if the NAIC determines that
revisions are necessary to take into account changes in the
relevant types of health benefits provisions or in
demographic conditions which form the basis for the set of rules of
actuarial equivalence or the target actuarial values. The provisions of
subsection (a)(2) shall apply to such a revision in the same manner as
they apply to the initial determination of the set of rules.
``(2) Secretary.--The Secretary may by regulation revise
the set of rules of actuarial equivalence and target actuarial
values from time to time if the Secretary determines such
revisions are necessary to take into account changes described
in paragraph (1).
``SEC. 721B. ESTABLISHMENT OF PLAN STANDARDS.
``(a) Establishment of General Standards.--
``(1) Role of naic.--The NAIC is requested to submit to the
Secretary, within 9 months after the date of the enactment of
this subpart, model regulations that specify standards for
making qualified group health plans available to small
employers. If the NAIC develops recommended regulations
specifying such standards within such period, the Secretary
shall review the standards. Such review shall be completed
within 60 days after the date the regulations are developed.
Such standards shall serve as the standards under this section,
with such amendments as the Secretary deems necessary. Such
standards shall be nonbinding (except as provided in chapter
4).
``(2) Contingency.--If the NAIC does not develop such model
regulations within the period described in paragraph (1), the
Secretary shall specify, within 15 months after the date of the
enactment of this subpart, model regulations that specify
standards for insurers with regard to making qualified group
health plans available to small employers. Such standards shall
be nonbinding (except as provided in chapter 4).
``(3) Effective date.--The standards specified in the model
regulations shall apply to group health plans and health
insurance issuers offering group health insurance coverage in a
State on or after the respective date the standards are
implemented in the State.
``(b) No Preemption of State Law.--A State may implement standards
for group health plans available, and health insurance issuers offering
group health insurance coverage offered, to small employers that are
more stringent than the standards under this section, except that a
State may not implement standards that prevent the offering of at least
one group health plan that provides standard coverage (as described in
section 721A(b)).
``SEC. 721C. RATING LIMITATIONS FOR COMMUNITY-RATED MARKET.
``(a) Standard Premiums With Respect to Community-Rated Eligible
Employees and Eligible Individuals.--
``(1) In general.--Each group health plan offered, and each
health insurance issuer offering group health insurance
coverage, to a small employer shall establish within each
community rating area in which the plan is to be offered, a
standard premium for enrollment of eligible employees and
eligible individuals for the standard coverage (as defined
under section 721A(b)).
``(2) Establishment of community rating area.--
``(A) In general.--Not later than January 1, 2000,
each State shall, in accordance with subparagraph (B),
provide for the division of the State into 1 or more
community rating areas. The State may revise the
boundaries of such areas from time to time consistent
with this paragraph.
``(B) Geographic area variations.--For purposes of
subparagraph (A), a State--
``(i) may not identify an area that divides
a 3-digit zip code, a county, or all portions
of a metropolitan statistical area;
``(ii) shall not permit premium rates for
coverage offered in a portion of an interstate
metropolitan statistical area to vary based on
the State in which the coverage is offered; and
``(iii) may, upon agreement with one or
more adjacent States, identify multi-State
geographic areas consistent with clauses (i)
and (ii).
``(3) Eligible individuals.--For purposes of this section,
the term `eligible individuals' includes certain uninsured
individuals (as described in section 721G).
``(b) Uniform Premiums Within Community Rating Areas.--
``(1) In general.--Subject to paragraphs (2) and (3), the
standard premium for each group health plan to which this
section applies shall be the same, but shall not include the
costs of premium processing and enrollment that may vary
depending on whether the method of enrollment is through
a qualified small employer purchasing group, through a small employer,
or through a broker.
``(2) Application to enrollees.--
``(A) In general.--The premium charged for coverage
in a group health plan which covers eligible employees
and eligible individuals shall be the product of--
``(i) the standard premium (established
under paragraph (1));
``(ii) in the case of enrollment other than
individual enrollment, the family adjustment
factor specified under subparagraph (B); and
``(iii) the age adjustment factor
(specified under subparagraph (C)).
``(B) Family adjustment factor.--
``(i) In general.--The standards
established under section 721B shall specify
family adjustment factors that reflect the
relative actuarial costs of benefit packages
based on family classes of enrollment (as
compared with such costs for individual
enrollment).
``(ii) Classes of enrollment.--For purposes
of this subpart, there are 4 classes of
enrollment:
``(I) Coverage only of an
individual (referred to in this subpart
as the `individual' enrollment or class
of enrollment).
``(II) Coverage of a married couple
without children (referred to in this
subpart as the `couple-only' enrollment
or class of enrollment).
``(III) Coverage of an individual
and one or more children (referred to
in this subpart as the `single parent'
enrollment or class of enrollment).
``(IV) Coverage of a married couple
and one or more children (referred to
in this subpart as the `dual parent'
enrollment or class of enrollment).
``(iii) References to family and couple
classes of enrollment.--In this subpart:
``(I) Family.--The terms `family
enrollment' and `family class of
enrollment' refer to enrollment in a
class of enrollment described in any
subclause of clause (ii) (other than
subclause (I)).
``(II) Couple.--The term `couple
class of enrollment' refers to
enrollment in a class of enrollment
described in subclause (II) or (IV) of
clause (ii).
``(iv) Spouse; married; couple.--
``(I) In general.--In this subpart,
the terms `spouse' and `married' mean,
with respect to an individual, another
individual who is the spouse of, or is
married to, the individual, as
determined under applicable State law.
``(II) Couple.--The term `couple'
means an individual and the
individual's spouse.
``(C) Age adjustment factor.--The Secretary, in
consultation with the NAIC, shall specify uniform age
categories and maximum rating increments for age
adjustment factors that reflect the relative actuarial
costs of benefit packages among enrollees. For
individuals who have attained age 18 but not age 65,
the highest age adjustment factor may not exceed 3
times the lowest age adjustment factor.
``(3) Administrative charges.--
``(A) In general.--In accordance with the standards
established under section 721B, a group health plan
which covers eligible employees and eligible
individuals may add a separately-stated administrative
charge which is based on identifiable differences in
legitimate administrative costs and which is applied
uniformly for individuals enrolling through the same
method of enrollment. Nothing in this subparagraph may
be construed as preventing a qualified small employer
purchasing group from negotiating a unique
administrative charge with an insurer for a group
health plan.
``(B) Enrollment through a qualified small employer
purchasing group.--In the case of an administrative
charge under subparagraph (A) for enrollment through a
qualified small employer purchasing group, such charge
may not exceed the lowest charge of such plan for
enrollment other than through a qualified small
employer purchasing group in such area.
``(c) Treatment of Negotiated Rate as Community Rate.--
Notwithstanding any other provision of this section, a group health
plan and a health insurance issuer offering health insurance coverage
that negotiates a premium rate (exclusive of any administrative charge
described in subsection (b)(3)) with a qualified small employer
purchasing group in a community rating area shall charge the same
premium rate to all eligible employees and eligible individuals.
``SEC. 721D. RATING PRACTICES AND PAYMENT OF PREMIUMS.
``(a) Full Disclosure of Rating Practices.--
``(1) In general.--A group health plan and a health
insurance issuer offering health insurance coverage shall fully
disclose rating practices for the plan to the appropriate
certifying authority.
``(2) Notice on expiration.--A group health plan and a
health insurance issuer offering health insurance coverage
shall provide for notice of the terms for renewal of a plan at
the time of the offering of the plan and at least 90 days
before the date of expiration of the plan.
``(3) Actuarial certification.--Each group health plan and
health insurance issuer offering health insurance coverage
shall file annually with the appropriate certifying authority a
written statement by a member of the American Academy of
Actuaries (or other individual acceptable to such authority)
who is not an employee of the group health plan or issuer
certifying that, based upon an examination by the individual
which includes a review of the appropriate records and of the
actuarial assumptions of such plan or insurer and methods used
by the plan or insurer in establishing premium rates and
administrative charges for group health plans--
``(A) such plan or insurer is in compliance with
the applicable provisions of this subpart; and
``(B) the rating methods are actuarially sound.
Each plan and insurer shall retain a copy of such statement at
its principal place of business for examination by any
individual.
``(b) Payment of Premiums.--
``(1) In general.--With respect to a new enrollee in a
group health plan, the plan may require advanced payment of an
amount equal to the monthly applicable premium for the plan at
the time such individual is enrolled.
``(2) Notification of failure to receive premium.--If a
group health plan or a health insurance issuer offering health
insurance coverage fails to receive payment on a premium due
with respect to an eligible employee or eligible individual
covered under the plan involved, the plan or issuer shall
provide notice of such failure to the employee or individual
within the 20-day period after the date on which such premium
payment was due. A plan or issuer may not terminate the
enrollment of an eligible employee or eligible individual
unless such employee or individual has been notified of any
overdue premiums and has been provided a reasonable opportunity
to respond to such notice.
``SEC. 721E. QUALIFIED SMALL EMPLOYER PURCHASING GROUPS.
``(a) Qualified Small Employer Purchasing Groups Described.--
``(1) In general.--A qualified small employer purchasing
group is an entity that--
``(A) is a nonprofit entity certified under State
law;
``(B) has a membership consisting solely of small
employers;
``(C) is administered solely under the authority
and control of its member employers;
``(D) with respect to each State in which its
members are located, consists of not fewer than the
number of small employers established by the State as
appropriate for such a group;
``(E) offers a program under which qualified group
health plans are offered to eligible employees and
eligible individuals through its member employers and
to certain uninsured individuals in accordance with
section 721D; and
``(F) an insurer, agent, broker, or any other
individual or entity engaged in the sale of insurance--
``(i) does not form or underwrite; and
``(ii) does not hold or control any right
to vote with respect to.
``(2) State certification.--A qualified small employer
purchasing group formed under this section shall submit an
application to the State for certification. The State shall
determine whether to issue a certification and otherwise ensure
compliance with the requirements of this subpart.
``(3) Special rule.--Notwithstanding paragraph (1)(B), an
employer member of a small employer purchasing group that has
been certified by the State as meeting the requirements of
paragraph (1) may retain its membership in the group if the
number of employees of the employer increases such that the
employer is no longer a small employer.
``(b) Board of Directors.--Each qualified small employer purchasing
group established under this section shall be governed by a board of
directors or have active input from an advisory board consisting of
individuals and businesses participating in the group.
``(c) Domiciliary State.--For purposes of this section, a qualified
small employer purchasing group operating in more than one State shall
be certified by the State in which the group is domiciled.
``(d) Membership.--
``(1) In general.--A qualified small employer purchasing
group shall accept all small employers and certain uninsured
individuals residing within the area served by the group as
members if such employers or individuals request such
membership.
``(2) Voting.--Members of a qualified small employer
purchasing group shall have voting rights consistent with the
rules established by the State.
``(e) Duties of Qualified Small Employer Purchasing Groups.--Each
qualified small employer purchasing group shall--
``(1) enter into agreements with insurers offering
qualified group health plans;
``(2) enter into agreements with small employers under
section 721F;
``(3) enroll only eligible employees, eligible individuals,
and certain uninsured individuals in qualified group health
plans, in accordance with section 721G;
``(4) provide enrollee information to the State;
``(5) meet the marketing requirements under section 721I;
and
``(6) carry out other functions provided for under this
subpart.
``(f) Limitation on Activities.--A qualified small employer
purchasing group shall not--
``(1) perform any activity involving approval or
enforcement of payment rates for providers;
``(2) perform any activity (other than the reporting of
noncompliance) relating to compliance of qualified group health
plans with the requirements of this subpart;
``(3) assume financial risk in relation to any such health
plan; or
``(4) perform other activities identified by the State as
being inconsistent with the performance of its duties under
this subpart.
``(g) Rules of Construction.--
``(1) Establishment not required.--Nothing in this section
shall be construed as requiring--
``(A) that a State organize, operate or otherwise
establish a qualified small employer purchasing group,
or otherwise require the establishment of purchasing
groups; and
``(B) that there be only one qualified small
employer purchasing group established with respect to a
community rating area.
``(2) Single organization serving multiple areas and
states.--Nothing in this section shall be construed as
preventing a single entity from being a qualified small
employer purchasing group in more than one community rating
area or in more than one State.
``(3) Voluntary participation.--Nothing in this section
shall be construed as requiring any individual or small
employer to purchase a qualified group health plan exclusively
through a qualified small employer purchasing group.
``SEC. 721F. AGREEMENTS WITH SMALL EMPLOYERS.
``(a) In General.--A qualified small employer purchasing group
shall offer to enter into an agreement under this section with each
small employer that employs eligible employees in the area served by
the group.
``(b) Payroll Deduction.--
``(1) In general.--Under an agreement under this section
between a small employer and a qualified small employer
purchasing group, the small employer shall deduct premiums from
an eligible employee's wages.
``(2) Additional premiums.--If the amount withheld under
paragraph (1) is not sufficient to cover the entire cost of the
premiums, the eligible employee shall be responsible for paying
directly to the qualified small employer purchasing group the
difference between the amount of such premiums and the amount
withheld.
``SEC. 721G. ENROLLING ELIGIBLE EMPLOYEES, ELIGIBLE INDIVIDUALS, AND
CERTAIN UNINSURED INDIVIDUALS IN QUALIFIED GROUP HEALTH
PLANS.
``(a) In General.--Each qualified small employer purchasing group
shall offer--
``(1) eligible employees,
``(2) eligible individuals, and
``(3) certain uninsured individuals,
the opportunity to enroll in any qualified group health plan which has
an agreement with the qualified small employer purchasing group for the
community rating area in which such employees and individuals reside.
``(b) Uninsured Individuals.--For purposes of this section, an
individual is described in subsection (a)(3) if such individual is an
uninsured individual who is not an eligible employee of a small
employer that is a member of a qualified small employer purchasing
group or a dependent of such individual.
``SEC. 721H. RECEIPT OF PREMIUMS.
``(a) Enrollment Charge.--The amount charged by a qualified small
employer purchasing group for coverage under a qualified group health
plan shall be equal to the sum of--
``(1) the premium rate offered by such health plan;
``(2) the administrative charge for such health plan; and
``(3) the purchasing group administrative charge for
enrollment of eligible employees, eligible individuals and
certain uninsured individuals through the group.
``(b) Disclosure of Premium Rates and Administrative Charges.--Each
qualified small employer purchasing group shall, prior to the time of
enrollment, disclose to enrollees and other interested parties the
premium rate for a qualified group health plan, the administrative
charge for such plan, and the administrative charge of the group,
separately.
``SEC. 721I. MARKETING ACTIVITIES.
``Each qualified small employer purchasing group shall market
qualified group health plans to members through the entire community
rating area served by the purchasing group.
``SEC. 721J. GRANTS TO STATES AND QUALIFIED SMALL EMPLOYER PURCHASING
GROUPS.
``(a) In General.--The Secretary shall award grants to States and
small employer purchasing groups to assist such States and groups in
planning, developing, and operating qualified small employer purchasing
groups.
``(b) Application Requirements.--To be eligible to receive a grant
under this section, a State or small employer purchasing group shall
prepare and submit to the Secretary an application in such form, at
such time, and containing such information, certifications, and
assurances as the Secretary shall reasonably require.
``(c) Use of Funds.--Amounts awarded under this section may be used
to finance the costs associated with planning, developing, and
operating a qualified small employer purchasing group. Such costs may
include the costs associated with--
``(1) engaging in education and outreach efforts to inform
small employers, insurers, and the public about the small
employer purchasing group;
``(2) soliciting bids and negotiating with insurers to make
available group health plans;
``(3) preparing the documentation required to receive
certification by the Secretary as a qualified small employer
purchasing group; and
``(4) such other activities determined appropriate by the
Secretary.
``(d) Authorization of Appropriations.--There are authorized to be
appropriated for awarding grants under this section such sums as may be
necessary.
``SEC. 721K. QUALIFIED SMALL EMPLOYER PURCHASING GROUPS ESTABLISHED BY
A STATE.
``A State may establish a system in all or part of the State under
which qualified small employer purchasing groups are the sole mechanism
through which health care coverage for the eligible employees of small
employers shall be purchased or provided.
``SEC. 721L. EFFECTIVE DATES.
``(a) In General.--Except as provided in this chapter, the
provisions of this chapter are effective on the date of the enactment
of this subpart.
``(b) Exception.--The provisions of section 721C(b) shall apply to
contracts which are issued, or renewed, after the date which is 18
months after the date of the enactment of this subpart.
``CHAPTER 2--REQUIRED COVERAGE OPTIONS FOR ELIGIBLE EMPLOYEES AND
DEPENDENTS OF SMALL EMPLOYERS
``SEC. 722. REQUIRING SMALL EMPLOYERS TO OFFER COVERAGE FOR ELIGIBLE
INDIVIDUALS.
``(a) Requirement to Offer.--Each small employer shall make
available with respect to each eligible employee a group health plan
under which--
``(1) coverage of each eligible individual with respect to
such an eligible employee may be elected on an annual basis for
each plan year;
``(2) coverage is provided for at least the standard
coverage specified in section 721A(b); and
``(3) each eligible employee electing such coverage may
elect to have any premiums owed by the employee collected
through payroll deduction.
``(b) No Employer Contribution Required.--An employer is not
required under subsection (a) to make any contribution to the cost of
coverage under a group health plan described in such subsection.
``(c) Special Rules.--
``(1) Exclusion of new employers and certain very small
employers.--Subsection (a) shall not apply to any small
employer for any plan year if, as of the beginning of such plan
year--
``(A) such employer (including any predecessor
thereof) has been an employer for less than 2 years;
``(B) such employer has no more than 2 eligible
employees; or
``(C) no more than 2 eligible employees are not
covered under any group health plan.
``(2) Exclusion of family members.--Under such procedures
as the Secretary may prescribe, any relative of a small
employer may be, at the election of the employer, excluded from
consideration as an eligible employee for purposes of applying
the requirements of subsection (a). In the case of a small
employer that is not an individual, an employee who is a
relative of a key employee (as defined in section 416(i)(1) of
the Internal Revenue Code of 1986) of the employer may, at the
election of the key employee, be considered a relative
excludable under this paragraph.
``(3) Optional application of waiting period.--A group
health plan and a health insurance issuer offering group health
insurance coverage shall not be treated as failing to meet the
requirements of subsection (a) solely because a period of
service by an eligible employee of not more than 60 days is
required under the plan for coverage under the plan of eligible
individuals with respect to such employee.
``(d) Construction.--Nothing in this section shall be construed as
limiting the group health plans, or types of coverage under such a
plan, that an employer may offer to an employee.
``SEC. 722A. COMPLIANCE WITH APPLICABLE REQUIREMENTS THROUGH MULTIPLE
EMPLOYER HEALTH ARRANGEMENTS.
``(a) In General.--In any case in which an eligible employee is,
for any plan year, a participant in a group health plan which is a
multiemployer plan, the requirements of section 722(a) shall be deemed
to be met with respect to such employee for such plan year if the
employer requirements of subsection (b) are met with respect to the
eligible employee, irrespective of whether, or to what extent, the
employer makes employer contributions on behalf of the eligible
employee.
``(b) Employer Requirements.--The employer requirements of this
subsection are met under a group health plan with respect to an
eligible employee if--
``(1) the employee is eligible under the plan to elect
coverage on an annual basis and is provided a reasonable
opportunity to make the election in such form and manner and at
such times as are provided by the plan;
``(2) coverage is provided for at least the standard
coverage specified in section 721A(b);
``(3) the employer facilitates collection of any employee
contributions under the plan and permits the employee to elect
to have employee contributions under the plan collected through
payroll deduction; and
``(4) in the case of a plan to which part 1 does not
otherwise apply, the employer provides to the employee a
summary plan description described in section 102(a)(1) in the
form and manner and at such times as are required under such
part 1 with respect to employee welfare benefit plans.
``CHAPTER 3--REQUIRED COVERAGE OPTIONS FOR INDIVIDUALS INSURED THROUGH
ASSOCIATION PLANS
``Subchapter A--Qualified Association Plans
``SEC. 723. TREATMENT OF QUALIFIED ASSOCIATION PLANS.
``(a) General Rule.--For purposes of this chapter, in the case of a
qualified association plan--
``(1) except as otherwise provided in this subchapter, the
plan shall meet all applicable requirements of chapter 1 and
chapter 2 for group health plans offered to and by small
employers;
``(2) if such plan is certified as meeting such
requirements and the requirements of this subchapter, such plan
shall be treated as a plan established and maintained by a
small employer, and individuals enrolled in such plan shall be
treated as eligible employees; and
``(3) any individual who is a member of the association not
enrolling in the plan shall not be treated as an eligible
employee solely by reason of membership in such association.
``(b) Election To Be Treated as Purchasing Cooperative.--Subsection
(a) shall not apply to a qualified association plan if--
``(1) the health insurance issuer makes an irrevocable
election to be treated as a qualified small employer purchasing
group for purposes of section 721D; and
``(2) such sponsor meets all requirements of this subpart
applicable to a purchasing cooperative.
``SEC. 723A. QUALIFIED ASSOCIATION PLAN DEFINED.
``(a) General Rule.--For purposes of this chapter, a plan is a
qualified association plan if the plan is a multiple employer welfare
arrangement or similar arrangement--
``(1) which is maintained by a qualified association;
``(2) which has at least 500 participants in the United
States;
``(3) under which the benefits provided consist solely of
medical care (as defined in section 213(d) of the Internal
Revenue Code of 1986);
``(4) which may not condition participation in the plan, or
terminate coverage under the plan, on the basis of the health
status or health claims experience of any employee or member or
dependent of either;
``(5) which provides for bonding, in accordance with
regulations providing rules similar to the rules under section
412, of all persons operating or administering the plan or
involved in the financial affairs of the plan; and
``(6) which notifies each participant or provider that it
is certified as meeting the requirements of this chapter
applicable to it.
``(b) Self-Insured Plans.--In the case of a plan which is not fully
insured (within the meaning of section 514(b)(6)(D)), the plan shall be
treated as a qualified association plan only if--
``(1) the plan meets minimum financial solvency and cash
reserve requirements for claims which are established by the
Secretary and which shall be in lieu of any other such
requirements under this chapter;
``(2) the plan provides an annual funding report (certified
by an independent actuary) and annual financial statements to
the Secretary and other interested parties; and
``(3) the plan appoints a plan sponsor who is responsible
for operating the plan and ensuring compliance with applicable
Federal and State laws.
``(c) Certification.--
``(1) In general.--A plan shall not be treated as a
qualified association plan for any period unless there is in
effect a certification by the Secretary that the plan meets the
requirements of this subchapter. For purposes of this chapter,
the Secretary shall be the appropriate certifying authority
with respect to the plan.
``(2) Fee.--The Secretary shall require a $5,000 fee for
the original certification under paragraph (1) and may charge a
reasonable annual fee to cover the costs of processing and
reviewing the annual statements of the plan.
``(3) Expedited procedures.--The Secretary may by
regulation provide for expedited registration, certification,
and comment procedures.
``(4) Agreements.--The Secretary of Labor may enter into
agreements with the States to carry out the Secretary's
responsibilities under this subchapter.
``(d) Availability.--Notwithstanding any other provision of this
chapter, a qualified association plan may limit coverage to individuals
who are members of the qualified association establishing or
maintaining the plan, an employee of such member, or a dependent of
either.
``(e) Special Rules for Existing Plans.--In the case of a plan in
existence on January 1, 1999--
``(1) the requirements of subsection (a) (other than
paragraphs (4), (5), and (6) thereof) shall not apply;
``(2) no original certification shall be required under
this subchapter; and
``(3) no annual report or funding statement shall be
required before January 1, 2001, but the plan shall file with
the Secretary a description of the plan and the name of the
health insurance issuer.
``SEC. 723B. DEFINITIONS AND SPECIAL RULES.
``(a) Qualified Association.--For purposes of this subchapter, the
term `qualified association' means any organization which--
``(1) is organized and maintained in good faith by a trade
association, an industry association, a professional
association, a chamber of commerce, a religious organization, a
public entity association, or other business association
serving a common or similar industry;
``(2) is organized and maintained for substantial purposes
other than to provide a health plan;
``(3) has a constitution, bylaws, or other similar
governing document which states its purpose; and
``(4) receives a substantial portion of its financial
support from its active, affiliated, or federation members.
``(b) Coordination.--The term `qualified association plan' shall
not include a plan to which subchapter B applies.
``Subchapter B--Special Rule for Church, Multiemployer, and Cooperative
Plans
``SEC. 723F. SPECIAL RULE FOR CHURCH, MULTIEMPLOYER, AND COOPERATIVE
PLANS.
``(a) General Rule.--For purposes of this chapter, in the case of a
group health plan to which this section applies--
``(1) except as otherwise provided in this subchapter, the
plan shall be required to meet all applicable requirements of
chapter 1 and chapter 2 for group health plans offered to and
by small employers;
``(2) if such plan is certified as meeting such
requirements, such plan shall be treated as a plan established
and maintained by a small employer and individuals enrolled in
such plan shall be treated as eligible employees; and
``(3) any individual eligible to enroll in the plan who
does not enroll in the plan shall not be treated as an eligible
employee solely by reason of being eligible to enroll in the
plan.
``(b) Modified Standards.--
``(1) Certifying authority.--For purposes of this chapter,
the Secretary shall be the appropriate certifying authority
with respect to a plan to which this section applies.
``(2) Availability.--Rules similar to the rules of
subsection (e) of section 723A shall apply to a plan to which
this section applies.
``(3) Access.--An employer which, pursuant to a collective
bargaining agreement, offers an employee the opportunity to
enroll in a plan described in subsection (c)(2) shall not be
required to make any other plan available to the employee.
``(4) Treatment under state laws.--A church plan described
in subsection (c)(1) which is certified as meeting the
requirements of this section shall not be deemed to be a
multiple employer welfare arrangement or an insurance company
or other insurer, or to be engaged in the business of
insurance, for purposes of any State law purporting to regulate
insurance companies or insurance contracts.
``(c) Plans to Which Section Applies.--This section shall apply to
a health plan which--
``(1) is a church plan (as defined in section 414(e) of the
Internal Revenue Code of 1986) which has at least 100
participants in the United States;
``(2) is a multiemployer plan which is maintained by a
health plan sponsor described in section 3(16)(B)(iii) and
which has at least 500 participants in the United States; or
``(3) is a plan which is maintained by a rural electric
cooperative or a rural telephone cooperative association and
which has at least 500 participants in the United States.''.
(b) Conforming Amendments.--Section 731(d) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1186(d)) is amended
by adding at the end the following:
``(3) Eligible employee.--The term `eligible employee'
means, with respect to an employer, an employee who normally
performs on a monthly basis at least 30 hours of service per
week for that employer.
``(4) Eligible individual.--The term `eligible individual'
means, with respect to an eligible employee, such employee, and
any dependent of such employee.
``(5) NAIC.--The term `NAIC' means the National Association
of Insurance Commissioners.
``(6) Qualified group health plan.--The term `qualified
group health plan' shall have the meaning given the term in
section 721.''.
SEC. 302. AMENDMENTS TO THE PUBLIC HEALTH SERVICE ACT RELATING TO THE
GROUP MARKET.
(a) In General.--Subpart 2 of part A of title XXVII of the Public
Health Service Act (42 U.S.C. 300gg-4 et seq.) is amended--
(1) by inserting after the subpart heading the following:
``CHAPTER 1--MISCELLANEOUS REQUIREMENTS'';
and
(2) by adding at the end the following:
``CHAPTER 2--GENERAL INSURANCE COVERAGE REFORMS
``Subchapter A--Increased Availability and Continuity of Health
Coverage
``SEC. 2707. DEFINITION.
``As used in this chapter, the term `qualified group health plan'
means a group health plan, and a health insurance issuer offering group
health insurance coverage, that is designed to provide standard
coverage (consistent with section 2707A(b)).
``SEC. 2707A. ACTUARIAL EQUIVALENCE IN BENEFITS PERMITTED.
``(a) Set of Rules of Actuarial Equivalence.--
``(1) Initial determination.--The NAIC is requested to
submit to the Secretary, within 6 months after the date of the
enactment of this chapter, a set of rules which the NAIC
determines is sufficient for determining, in the case of any
group health plan, or a health insurance issuer offering group
health insurance coverage, and for purposes of this section,
the actuarial value of the coverage offered by the plan or
coverage.
``(2) Certification.--If the Secretary determines that the
NAIC has submitted a set of rules that comply with the
requirements of paragraph (1), the Secretary shall certify such
set of rules for use under this chapter. If the Secretary
determines that such a set of rules has not been submitted or
does not comply with such requirements, the Secretary shall
promptly establish a set of rules that meets such requirements.
``(b) Standard Coverage.--
``(1) In general.--A a group health plan, and a health
insurance issuer offering group health insurance coverage,
shall be considered to provide standard coverage consistent
with this subsection if the benefits are determined, in
accordance with the set of actuarial equivalence rules
certified under subsection (a), to have a value that is within
5 percentage points of the target actuarial value for standard
coverage established under paragraph (2).
``(2) Initial determination of target actuarial value for
standard coverage.--
``(A) Initial determination.--
``(i) In general.--The NAIC is requested to
submit to the Secretary, within 6 months after
the date of the enactment of this chapter, a
target actuarial value for standard coverage
equal to the average actuarial value of the
coverage described in clause (ii). No specific
procedure or treatment, or classes thereof, is
required to be considered in such determination
by this chapter or through regulations. The
determination of such value shall be based on a
representative distribution of the population
of eligible employees offered such coverage and
a single set of standardized utilization and
cost factors.
``(ii) Coverage described.--The coverage
described in this clause is coverage for
medically necessary and appropriate services
consisting of medical and surgical services,
medical equipment, preventive services, and
emergency transportation in frontier areas. No
specific procedure or treatment, or classes
thereof, is required to be covered in such a
plan, by this chapter or through regulations.
``(B) Certification.--If the Secretary determines
that the NAIC has submitted a target actuarial value
for standard coverage that complies with the
requirements of subparagraph (A), the Secretary shall
certify such value for use under this chapter. If the
Secretary determines that a target actuarial value has
not been submitted or does not comply with the
requirements of subparagraph (A), the Secretary shall
promptly determine a target actuarial value that meets
such requirements.
``(c) Subsequent Revisions.--
``(1) NAIC.--The NAIC may submit from time to time to the
Secretary revisions of the set of rules of actuarial
equivalence and target actuarial values previously established
or determined under this section if the NAIC determines that
revisions are necessary to take into account changes in the
relevant types of health benefits provisions or in demographic
conditions which form the basis for the set of rules of
actuarial equivalence or the target actuarial values. The
provisions of subsection (a)(2) shall apply to such a revision
in the same manner as they apply to the initial determination
of the set of rules.
``(2) Secretary.--The Secretary may by regulation revise
the set of rules of actuarial equivalence and target actuarial
values from time to time if the Secretary determines such
revisions are necessary to take into account changes described
in paragraph (1).
``SEC. 2707B. ESTABLISHMENT OF PLAN STANDARDS.
``(a) Establishment of General Standards.--
``(1) Role of naic.--The NAIC is requested to submit to the
Secretary, within 9 months after the date of the enactment of
this chapter, model regulations that specify standards for
making qualified group health plans available to small
employers. If the NAIC develops recommended regulations
specifying such standards within such period, the Secretary shall
review the standards. Such review shall be completed within 60 days
after the date the regulations are developed. Such standards shall
serve as the standards under this section, with such amendments as the
Secretary deems necessary. Such standards shall be nonbinding (except
as provided in chapter 4).
``(2) Contingency.--If the NAIC does not develop such model
regulations within the period described in paragraph (1), the
Secretary shall specify, within 15 months after the date of the
enactment of this chapter, model regulations that specify
standards for insurers with regard to making qualified group
health plans available to small employers. Such standards shall
be nonbinding (except as provided in chapter 4).
``(3) Effective date.--The standards specified in the model
regulations shall apply to group health plans and health
insurance issuers offering group health insurance coverage in a
State on or after the respective date the standards are
implemented in the State.
``(b) No Preemption of State Law.--A State may implement standards
for group health plans available, and health insurance issuers offering
group health insurance coverage offered, to small employers that are
more stringent than the standards under this section, except that a
State may not implement standards that prevent the offering of at least
one group health plan that provides standard coverage (as described in
section 2707A(b)).
``SEC. 2707C. RATING LIMITATIONS FOR COMMUNITY-RATED MARKET.
``(a) Standard Premiums With Respect to Community-Rated Eligible
Employees and Eligible Individuals.--
``(1) In general.--Each group health plan offered, and each
health insurance issuer offering group health insurance
coverage, to a small employer shall establish within each
community rating area in which the plan is to be offered, a
standard premium for enrollment of eligible employees and
eligible individuals for the standard coverage (as defined
under section 2707A(b)).
``(2) Establishment of community rating area.--
``(A) In general.--Not later than January 1, 2000,
each State shall, in accordance with subparagraph (B),
provide for the division of the State into 1 or more
community rating areas. The State may revise the
boundaries of such areas from time to time consistent
with this paragraph.
``(B) Geographic area variations.--For purposes of
subparagraph (A), a State--
``(i) may not identify an area that divides
a 3-digit zip code, a county, or all portions
of a metropolitan statistical area;
``(ii) shall not permit premium rates for
coverage offered in a portion of an interstate
metropolitan statistical area to vary based on
the State in which the coverage is offered; and
``(iii) may, upon agreement with one or
more adjacent States, identify multi-State
geographic areas consistent with clauses (i)
and (ii).
``(3) Eligible individuals.--For purposes of this section,
the term `eligible individuals' includes certain uninsured
individuals (as described in section 2707G).
``(b) Uniform Premiums Within Community Rating Areas.--
``(1) In general.--Subject to paragraphs (2) and (3), the
standard premium for each group health plan to which this
section applies shall be the same, but shall not include the
costs of premium processing and enrollment that may vary
depending on whether the method of enrollment is through a
qualified small employer purchasing group, through a small
employer, or through a broker.
``(2) Application to enrollees.--
``(A) In general.--The premium charged for coverage
in a group health plan which covers eligible employees
and eligible individuals shall be the product of--
``(i) the standard premium (established
under paragraph (1));
``(ii) in the case of enrollment other than
individual enrollment, the family adjustment
factor specified under subparagraph (B); and
``(iii) the age adjustment factor
(specified under subparagraph (C)).
``(B) Family adjustment factor.--
``(i) In general.--The standards
established under section 2707B shall specify
family adjustment factors that reflect
the relative actuarial costs of benefit packages based on family
classes of enrollment (as compared with such costs for individual
enrollment).
``(ii) Classes of enrollment.--For purposes
of this chapter, there are 4 classes of
enrollment:
``(I) Coverage only of an
individual (referred to in this chapter
as the `individual' enrollment or class
of enrollment).
``(II) Coverage of a married couple
without children (referred to in this
chapter as the `couple-only' enrollment
or class of enrollment).
``(III) Coverage of an individual
and one or more children (referred to
in this chapter as the `single parent'
enrollment or class of enrollment).
``(IV) Coverage of a married couple
and one or more children (referred to
in this chapter as the `dual parent'
enrollment or class of enrollment).
``(iii) References to family and couple
classes of enrollment.--In this chapter:
``(I) Family.--The terms `family
enrollment' and `family class of
enrollment' refer to enrollment in a
class of enrollment described in any
subclause of clause (ii) (other than subclause (I)).
``(II) Couple.--The term `couple
class of enrollment' refers to
enrollment in a class of enrollment
described in subclause (II) or (IV) of
clause (ii).
``(iv) Spouse; married; couple.--
``(I) In general.--In this chapter,
the terms `spouse' and `married' mean,
with respect to an individual, another
individual who is the spouse of, or is
married to, the individual, as
determined under applicable State law.
``(II) Couple.--The term `couple'
means an individual and the
individual's spouse.
``(C) Age adjustment factor.--The Secretary, in
consultation with the NAIC, shall specify uniform age
categories and maximum rating increments for age
adjustment factors that reflect the relative actuarial
costs of benefit packages among enrollees. For
individuals who have attained age 18 but not age 65,
the highest age adjustment factor may not exceed 3
times the lowest age adjustment factor.
``(3) Administrative charges.--
``(A) In general.--In accordance with the standards
established under section 2707B, a group health plan
which covers eligible employees and eligible
individuals may add a separately-stated administrative
charge which is based on identifiable differences in
legitimate administrative costs and which is applied
uniformly for individuals enrolling through the same
method of enrollment. Nothing in this subparagraph may
be construed as preventing a qualified small employer
purchasing group from negotiating a unique
administrative charge with an insurer for a group
health plan.
``(B) Enrollment through a qualified small employer
purchasing group.--In the case of an administrative
charge under subparagraph (A) for enrollment through a
qualified small employer purchasing group, such charge
may not exceed the lowest charge of such plan for
enrollment other than through a qualified small
employer purchasing group in such area.
``(c) Treatment of Negotiated Rate as Community Rate.--
Notwithstanding any other provision of this section, a group health
plan and a health insurance issuer offering health insurance coverage
that negotiates a premium rate (exclusive of any administrative charge
described in subsection (b)(3)) with a qualified small employer
purchasing group in a community rating area shall charge the same
premium rate to all eligible employees and eligible individuals.
``SEC. 2707D. RATING PRACTICES AND PAYMENT OF PREMIUMS.
``(a) Full Disclosure of Rating Practices.--
``(1) In general.--A group health plan and a health
insurance issuer offering health insurance coverage shall fully
disclose rating practices for the plan to the appropriate
certifying authority.
``(2) Notice on expiration.--A group health plan and a
health insurance issuer offering health insurance coverage
shall provide for notice of the terms for renewal of a plan at the time
of the offering of the plan and at least 90 days before the date of
expiration of the plan.
``(3) Actuarial certification.--Each group health plan and
health insurance issuer offering health insurance coverage
shall file annually with the appropriate certifying authority a
written statement by a member of the American Academy of
Actuaries (or other individual acceptable to such authority)
who is not an employee of the group health plan or issuer
certifying that, based upon an examination by the individual
which includes a review of the appropriate records and of the
actuarial assumptions of such plan or insurer and methods used
by the plan or insurer in establishing premium rates and
administrative charges for group health plans--
``(A) such plan or insurer is in compliance with
the applicable provisions of this chapter; and
``(B) the rating methods are actuarially sound.
Each plan and insurer shall retain a copy of such statement at
its principal place of business for examination by any
individual.
``(b) Payment of Premiums.--
``(1) In general.--With respect to a new enrollee in a
group health plan, the plan may require advanced payment of an
amount equal to the monthly applicable premium for the plan at
the time such individual is enrolled.
``(2) Notification of failure to receive premium.--If a
group health plan or a health insurance issuer offering health
insurance coverage fails to receive payment on a premium due
with respect to an eligible employee or eligible individual
covered under the plan involved, the plan or issuer shall
provide notice of such failure to the employee or individual
within the 20-day period after the date on which such premium
payment was due. A plan or issuer may not terminate the
enrollment of an eligible employee or eligible individual
unless such employee or individual has been notified of any
overdue premiums and has been provided a reasonable opportunity
to respond to such notice.
``SEC. 2707E. QUALIFIED SMALL EMPLOYER PURCHASING GROUPS.
``(a) Qualified Small Employer Purchasing Groups Described.--
``(1) In general.--A qualified small employer purchasing
group is an entity that--
``(A) is a nonprofit entity certified under State
law;
``(B) has a membership consisting solely of small
employers;
``(C) is administered solely under the authority
and control of its member employers;
``(D) with respect to each State in which its
members are located, consists of not fewer than the
number of small employers established by the State as
appropriate for such a group;
``(E) offers a program under which qualified group
health plans are offered to eligible employees and
eligible individuals through its member employers and
to certain uninsured individuals in accordance with
section 2707D; and
``(F) an insurer, agent, broker, or any other
individual or entity engaged in the sale of insurance--
``(i) does not form or underwrite; and
``(ii) does not hold or control any right
to vote with respect to.
``(2) State certification.--A qualified small employer
purchasing group formed under this section shall submit an
application to the State for certification. The State shall
determine whether to issue a certification and otherwise ensure
compliance with the requirements of this chapter.
``(3) Special rule.--Notwithstanding paragraph (1)(B), an
employer member of a small employer purchasing group that has
been certified by the State as meeting the requirements of
paragraph (1) may retain its membership in the group if the
number of employees of the employer increases such that the
employer is no longer a small employer.
``(b) Board of Directors.--Each qualified small employer purchasing
group established under this section shall be governed by a board of
directors or have active input from an advisory board consisting of
individuals and businesses participating in the group.
``(c) Domiciliary State.--For purposes of this section, a qualified
small employer purchasing group operating in more than one State shall
be certified by the State in which the group is domiciled.
``(d) Membership.--
``(1) In general.--A qualified small employer purchasing
group shall accept all small employers and certain uninsured
individuals residing within the area served by the group as members if
such employers or individuals request such membership.
``(2) Voting.--Members of a qualified small employer
purchasing group shall have voting rights consistent with the
rules established by the State.
``(e) Duties of Qualified Small Employer Purchasing Groups.--Each
qualified small employer purchasing group shall--
``(1) enter into agreements with insurers offering
qualified group health plans;
``(2) enter into agreements with small employers under
section 2707F;
``(3) enroll only eligible employees, eligible individuals,
and certain uninsured individuals in qualified group health
plans, in accordance with section 2707G;
``(4) provide enrollee information to the State;
``(5) meet the marketing requirements under section 2707I;
and
``(6) carry out other functions provided for under this
chapter.
``(f) Limitation on Activities.--A qualified small employer
purchasing group shall not--
``(1) perform any activity involving approval or
enforcement of payment rates for providers;
``(2) perform any activity (other than the reporting of
noncompliance) relating to compliance of qualified group health
plans with the requirements of this chapter;
``(3) assume financial risk in relation to any such health
plan; or
``(4) perform other activities identified by the State as
being inconsistent with the performance of its duties under
this chapter.
``(g) Rules of Construction.--
``(1) Establishment not required.--Nothing in this section
shall be construed as requiring--
``(A) that a State organize, operate or otherwise
establish a qualified small employer purchasing group,
or otherwise require the establishment of purchasing
groups; and
``(B) that there be only one qualified small
employer purchasing group established with respect to a
community rating area.
``(2) Single organization serving multiple areas and
states.--Nothing in this section shall be construed as
preventing a single entity from being a qualified small
employer purchasing group in more than one community rating
area or in more than one State.
``(3) Voluntary participation.--Nothing in this section
shall be construed as requiring any individual or small
employer to purchase a qualified group health plan exclusively
through a qualified small employer purchasing group.
``SEC. 2707F. AGREEMENTS WITH SMALL EMPLOYERS.
``(a) In General.--A qualified small employer purchasing group
shall offer to enter into an agreement under this section with each
small employer that employs eligible employees in the area served by
the group.
``(b) Payroll Deduction.--
``(1) In general.--Under an agreement under this section
between a small employer and a qualified small employer
purchasing group, the small employer shall deduct premiums from
an eligible employee's wages.
``(2) Additional premiums.--If the amount withheld under
paragraph (1) is not sufficient to cover the entire cost of the
premiums, the eligible employee shall be responsible for paying
directly to the qualified small employer purchasing group the
difference between the amount of such premiums and the amount
withheld.
``SEC. 2707G. ENROLLING ELIGIBLE EMPLOYEES, ELIGIBLE INDIVIDUALS, AND
CERTAIN UNINSURED INDIVIDUALS IN QUALIFIED GROUP HEALTH
PLANS.
``(a) In General.--Each qualified small employer purchasing group
shall offer--
``(1) eligible employees,
``(2) eligible individuals, and
``(3) certain uninsured individuals,
the opportunity to enroll in any qualified group health plan which has
an agreement with the qualified small employer purchasing group for the
community rating area in which such employees and individuals reside.
``(b) Uninsured Individuals.--For purposes of this section, an
individual is described in subsection (a)(3) if such individual is an
uninsured individual who is not an eligible employee of a small
employer that is a member of a qualified small employer purchasing
group or a dependent of such individual.
``SEC. 2707H. RECEIPT OF PREMIUMS.
``(a) Enrollment Charge.--The amount charged by a qualified small
employer purchasing group for coverage under a qualified group health
plan shall be equal to the sum of--
``(1) the premium rate offered by such health plan;
``(2) the administrative charge for such health plan; and
``(3) the purchasing group administrative charge for
enrollment of eligible employees, eligible individuals and
certain uninsured individuals through the group.
``(b) Disclosure of Premium Rates and Administrative Charges.--Each
qualified small employer purchasing group shall, prior to the time of
enrollment, disclose to enrollees and other interested parties the
premium rate for a qualified group health plan, the administrative
charge for such plan, and the administrative charge of the group,
separately.
``SEC. 2707I. MARKETING ACTIVITIES.
``Each qualified small employer purchasing group shall market
qualified group health plans to members through the entire community
rating area served by the purchasing group.
``SEC. 2707J. GRANTS TO STATES AND QUALIFIED SMALL EMPLOYER PURCHASING
GROUPS.
``(a) In General.--The Secretary shall award grants to States and
small employer purchasing groups to assist such States and groups in
planning, developing, and operating qualified small employer purchasing
groups.
``(b) Application Requirements.--To be eligible to receive a grant
under this section, a State or small employer purchasing group shall
prepare and submit to the Secretary an application in such form, at
such time, and containing such information, certifications, and
assurances as the Secretary shall reasonably require.
``(c) Use of Funds.--Amounts awarded under this section may be used
to finance the costs associated with planning, developing, and
operating a qualified small employer purchasing group. Such costs may
include the costs associated with--
``(1) engaging in education and outreach efforts to inform
small employers, insurers, and the public about the small
employer purchasing group;
``(2) soliciting bids and negotiating with insurers to make
available group health plans;
``(3) preparing the documentation required to receive
certification by the Secretary as a qualified small employer
purchasing group; and
``(4) such other activities determined appropriate by the
Secretary.
``(d) Authorization of Appropriations.--There are authorized to be
appropriated for awarding grants under this section such sums as may be
necessary.
``SEC. 2707K. QUALIFIED SMALL EMPLOYER PURCHASING GROUPS ESTABLISHED BY
A STATE.
``A State may establish a system in all or part of the State under
which qualified small employer purchasing groups are the sole mechanism
through which health care coverage for the eligible employees of small
employers shall be purchased or provided.
``SEC. 2707L. EFFECTIVE DATES.
``(a) In General.--Except as provided in this chapter, the
provisions of this chapter are effective on the date of the enactment
of this chapter.
``(b) Exception.--The provisions of section 2707C(b) shall apply to
contracts which are issued, or renewed, after the date which is 18
months after the date of the enactment of this chapter.
``Subchapter B--Required Coverage Options for Eligible Employees and
Dependents of Small Employers
``SEC. 2708. REQUIRING SMALL EMPLOYERS TO OFFER COVERAGE FOR ELIGIBLE
INDIVIDUALS.
``(a) Requirement To Offer.--Each small employer shall make
available with respect to each eligible employee a group health plan
under which--
``(1) coverage of each eligible individual with respect to
such an eligible employee may be elected on an annual basis for
each plan year;
``(2) coverage is provided for at least the standard
coverage specified in section 2707A(b); and
``(3) each eligible employee electing such coverage may
elect to have any premiums owed by the employee collected
through payroll deduction.
``(b) No Employer Contribution Required.--An employer is not
required under subsection (a) to make any contribution to the cost of
coverage under a group health plan described in such subsection.
``(c) Special Rules.--
``(1) Exclusion of new employers and certain very small
employers.--Subsection (a) shall not apply to any small
employer for any plan year if, as of the beginning of such plan
year--
``(A) such employer (including any predecessor
thereof) has been an employer for less than 2 years;
``(B) such employer has no more than 2 eligible
employees; or
``(C) no more than 2 eligible employees are not
covered under any group health plan.
``(2) Exclusion of family members.--Under such procedures
as the Secretary may prescribe, any relative of a small
employer may be, at the election of the employer, excluded from
consideration as an eligible employee for purposes of applying
the requirements of subsection (a). In the case of a small employer
that is not an individual, an employee who is a relative of a key
employee (as defined in section 416(i)(1) of the Internal Revenue Code
of 1986) of the employer may, at the election of the key employee, be
considered a relative excludable under this paragraph.
``(3) Optional application of waiting period.--A group
health plan and a health insurance issuer offering group health
insurance coverage shall not be treated as failing to meet the
requirements of subsection (a) solely because a period of
service by an eligible employee of not more than 60 days is
required under the plan for coverage under the plan of eligible
individuals with respect to such employee.
``(d) Construction.--Nothing in this section shall be construed as
limiting the group health plans, or types of coverage under such a
plan, that an employer may offer to an employee.
``SEC. 2708A. COMPLIANCE WITH APPLICABLE REQUIREMENTS THROUGH MULTIPLE
EMPLOYER HEALTH ARRANGEMENTS.
``(a) In General.--In any case in which an eligible employee is,
for any plan year, a participant in a group health plan which is a
multiemployer plan, the requirements of section 2722(a) shall be deemed
to be met with respect to such employee for such plan year if the
employer requirements of subsection (b) are met with respect to the
eligible employee, irrespective of whether, or to what extent, the
employer makes employer contributions on behalf of the eligible
employee.
``(b) Employer Requirements.--The employer requirements of this
subsection are met under a group health plan with respect to an
eligible employee if--
``(1) the employee is eligible under the plan to elect
coverage on an annual basis and is provided a reasonable
opportunity to make the election in such form and manner and at
such times as are provided by the plan;
``(2) coverage is provided for at least the standard
coverage specified in section 2707A(b);
``(3) the employer facilitates collection of any employee
contributions under the plan and permits the employee to elect
to have employee contributions under the plan collected through
payroll deduction; and
``(4) in the case of a plan to which subchapter A does not
otherwise apply, the employer provides to the employee a
summary plan description described in section 102(a)(1) of the
Employee Retirement Income Security Act of 1974 in the form and
manner and at such times as are required under such subchapter
A with respect to employee welfare benefit plans.
``Subchapter C--Required Coverage Options for Individuals Insured
Through Association Plans
``SEC. 2709. TREATMENT OF QUALIFIED ASSOCIATION PLANS.
``(a) General Rule.--For purposes of this chapter, in the case of a
qualified association plan--
``(1) except as otherwise provided in this subchapter, the
plan shall meet all applicable requirements of chapter 1 and
chapter 2 for group health plans offered to and by small
employers;
``(2) if such plan is certified as meeting such
requirements and the requirements of this subchapter, such plan
shall be treated as a plan established and maintained by a
small employer, and individuals enrolled in such plan shall be
treated as eligible employees; and
``(3) any individual who is a member of the association not
enrolling in the plan shall not be treated as an eligible
employee solely by reason of membership in such association.
``(b) Election To Be Treated as Purchasing Cooperative.--Subsection
(a) shall not apply to a qualified association plan if--
``(1) the health insurance issuer makes an irrevocable
election to be treated as a qualified small employer purchasing
group for purposes of section 2707D; and
``(2) such sponsor meets all requirements of this chapter
applicable to a purchasing cooperative.
``SEC. 2709A. QUALIFIED ASSOCIATION PLAN DEFINED.
``(a) General Rule.--For purposes of this chapter, a plan is a
qualified association plan if the plan is a multiple employer welfare
arrangement or similar arrangement--
``(1) which is maintained by a qualified association;
``(2) which has at least 500 participants in the United
States;
``(3) under which the benefits provided consist solely of
medical care (as defined in section 213(d) of the Internal
Revenue Code of 1986);
``(4) which may not condition participation in the plan, or
terminate coverage under the plan, on the basis of the health
status or health claims experience of any employee or member or
dependent of either;
``(5) which provides for bonding, in accordance with
regulations providing rules similar to the rules under section
412, of all persons operating or administering the plan or
involved in the financial affairs of the plan; and
``(6) which notifies each participant or provider that it
is certified as meeting the requirements of this chapter
applicable to it.
``(b) Self-Insured Plans.--In the case of a plan which is not fully
insured (within the meaning of section 514(b)(6)(D)), the plan shall be
treated as a qualified association plan only if--
``(1) the plan meets minimum financial solvency and cash
reserve requirements for claims which are established by the
Secretary and which shall be in lieu of any other such
requirements under this chapter;
``(2) the plan provides an annual funding report (certified
by an independent actuary) and annual financial statements to
the Secretary and other interested parties; and
``(3) the plan appoints a plan sponsor who is responsible
for operating the plan and ensuring compliance with applicable
Federal and State laws.
``(c) Certification.--
``(1) In general.--A plan shall not be treated as a
qualified association plan for any period unless there is in
effect a certification by the Secretary that the plan meets the
requirements of this subchapter. For purposes of this chapter,
the Secretary shall be the appropriate certifying authority
with respect to the plan.
``(2) Fee.--The Secretary shall require a $5,000 fee for
the original certification under paragraph (1) and may charge a
reasonable annual fee to cover the costs of processing and
reviewing the annual statements of the plan.
``(3) Expedited procedures.--The Secretary may by
regulation provide for expedited registration, certification,
and comment procedures.
``(4) Agreements.--The Secretary of Labor may enter into
agreements with the States to carry out the Secretary's
responsibilities under this subchapter.
``(d) Availability.--Notwithstanding any other provision of this
chapter, a qualified association plan may limit coverage to individuals
who are members of the qualified association establishing or
maintaining the plan, an employee of such member, or a dependent of
either.
``(e) Special Rules for Existing Plans.--In the case of a plan in
existence on January 1, 1999--
``(1) the requirements of subsection (a) (other than
paragraphs (4), (5), and (6) thereof) shall not apply;
``(2) no original certification shall be required under
this subchapter; and
``(3) no annual report or funding statement shall be
required before January 1, 2001, but the plan shall file with
the Secretary a description of the plan and the name of the
health insurance issuer.
``SEC. 2709B. DEFINITIONS AND SPECIAL RULES.
``(a) Qualified Association.--For purposes of this subchapter, the
term `qualified association' means any organization which--
``(1) is organized and maintained in good faith by a trade
association, an industry association, a professional
association, a chamber of commerce, a religious organization, a
public entity association, or other business association
serving a common or similar industry;
``(2) is organized and maintained for substantial purposes
other than to provide a health plan;
``(3) has a constitution, bylaws, or other similar
governing document which states its purpose; and
``(4) receives a substantial portion of its financial
support from its active, affiliated, or federation members.
``(b) Coordination.--The term `qualified association plan' shall
not include a plan to which subchapter B applies.
``SEC. 2709C. SPECIAL RULE FOR CHURCH, MULTIEMPLOYER, AND COOPERATIVE
PLANS.
``(a) General Rule.--For purposes of this chapter, in the case of a
group health plan to which this section applies--
``(1) except as otherwise provided in this subchapter, the
plan shall be required to meet all applicable requirements of
subchapter A and subchapter B for group health plans offered to
and by small employers;
``(2) if such plan is certified as meeting such
requirements, such plan shall be treated as a plan established
and maintained by a small employer and individuals enrolled in
such plan shall be treated as eligible employees; and
``(3) any individual eligible to enroll in the plan who
does not enroll in the plan shall not be treated as an eligible
employee solely by reason of being eligible to enroll in the
plan.
``(b) Modified Standards.--
``(1) Certifying authority.--For purposes of this chapter,
the Secretary shall be the appropriate certifying authority
with respect to a plan to which this section applies.
``(2) Availability.--Rules similar to the rules of
subsection (e) of section 2709A shall apply to a plan to which
this section applies.
``(3) Access.--An employer which, pursuant to a collective
bargaining agreement, offers an employee the opportunity to
enroll in a plan described in subsection (c)(2) shall not be
required to make any other plan available to the employee.
``(4) Treatment under state laws.--A church plan described
in subsection (c)(1) which is certified as meeting the
requirements of this section shall not be deemed to be a
multiple employer welfare arrangement or an insurance company
or other insurer, or to be engaged in the business of
insurance, for purposes of any State law purporting to regulate
insurance companies or insurance contracts.
``(c) Plans to Which Section Applies.--This section shall apply to
a health plan which--
``(1) is a church plan (as defined in section 414(e) of the
Internal Revenue Code of 1986) which has at least 100
participants in the United States;
``(2) is a multiemployer plan which is maintained by a
health plan sponsor described in section 3(16)(B)(iii) of the
Employee Retirement Income Security Act of 1974 and which has
at least 500 participants in the United States; or
``(3) is a plan which is maintained by a rural electric
cooperative or a rural telephone cooperative association and
which has at least 500 participants in the United States.''.
(b) Conforming Amendments.--Section 2791(d) of the Public Health
Service Act (42 U.S.C. 300gg-91(d)) is amended by adding at the end the
following:
``(15) Eligible employee.--The term `eligible employee'
means, with respect to an employer, an employee who normally
performs on a monthly basis at least 30 hours of service per
week for that employer.
``(16) Eligible individual.--The term `eligible individual'
means, with respect to an eligible employee, such employee, and
any dependent of such employee.
``(17) NAIC.--The term `NAIC' means the National
Association of Insurance Commissioners.
``(18) Qualified group health plan.--The term `qualified
group health plan' shall have the meaning given the term in
section 2707.''.
SEC. 303. AMENDMENT TO THE PUBLIC HEALTH SERVICE ACT RELATING TO THE
INDIVIDUAL MARKET.
Subpart 3 of part B of title XXVII of the Public Health Service Act
(42 U.S.C. 300gg-51 et seq.), as amended by the Omnibus Consolidated
and Emergency Supplemental Appropriations Act, 1999 (Public Law 105-
277), is amended by adding at the end the following:
``SEC. 2753. APPLICABILITY OF GENERAL INSURANCE MARKET REFORMS.
``The provisions of chapter 2 of subpart 2 of part A shall apply to
health insurance coverage offered by a health insurance issuer in the
individual market in the same manner as they apply to health insurance
coverage offered by a health insurance issuer in connection with a
group health plan in the small or large group market.''.
SEC. 304. EFFECTIVE DATE.
The amendments made by this subtitle shall apply with respect to
health insurance coverage offered, sold, issued, renewed, in effect, or
operated on or after January 1, 2000.
Subtitle B--Tax Provisions
SEC. 311. ENFORCEMENT WITH RESPECT TO HEALTH INSURANCE ISSUERS.
(a) In General.--Chapter 43 of the Internal Revenue Code of 1986
(relating to qualified pension, etc., plans) is amended by adding at
the end the following:
``SEC. 4980F. FAILURE OF INSURER TO COMPLY WITH CERTAIN STANDARDS FOR
HEALTH INSURANCE COVERAGE.
``(a) Imposition of Tax.--
``(1) In general.--There is hereby imposed a tax on the
failure of a health insurance issuer to comply with the
requirements applicable to such issuer under--
``(A) chapter 2 of subpart 2 of part A of title
XXVII of the Public Health Service Act;
``(B) section 2753 of the Public Health Service
Act; and
``(C) subpart C of part 7 of subtitle B of title I
of the Employee Retirement Income Security Act of 1974.
``(2) Exception.--Paragraph (1) shall not apply to a
failure by a health insurance issuer in a State if the
Secretary of Health and Human Services determines that the State has in
effect a regulatory enforcement mechanism that provides adequate
sanctions with respect to such a failure by such an issuer.
``(b) Amount of Tax.--
``(1) In general.--Subject to paragraph (2), the amount of
the tax imposed by subsection (a) shall be $100 for each day
during which such failure persists for each person to which
such failure relates. A rule similar to the rule of section
4980D(b)(3) shall apply for purposes of this section.
``(2) Limitation.--The amount of the tax imposed by
subsection (a) for a health insurance issuer with respect to
health insurance coverage shall not exceed 25 percent of the
amounts received under the coverage for coverage during the
period such failure persists.
``(c) Liability for Tax.--The tax imposed by this section shall be
paid by the health insurance issuer.
``(d) Limitations on Amount of Tax.--
``(1) Tax not to apply to failures corrected within 30
days.--No tax shall be imposed by subsection (a) on any failure
if--
``(A) such failure was due to reasonable cause and
not to willful neglect, and
``(B) such failure is corrected during the 30-day
period (or such period as the Secretary may determine
appropriate) beginning on the first date the health
insurance issuer knows, or exercising reasonable
diligence could have known, that such failure existed.
``(2) Waiver by secretary.--In the case of a failure which
is due to reasonable cause and not to willful neglect, the
Secretary may waive part or all of the tax imposed by
subsection (a) to the extent that the payment of such tax would
be excessive relative to the failure involved.
``(e) Definitions.--For purposes of this section, the terms `health
insurance coverage' and `health insurance issuer' have the meanings
given such terms in section 2791 of the Public Health Service Act and
section 733 of the Employee Retirement Income Security Act of 1974.''.
(b) Conforming Amendment.--The table of sections for such chapter
43 is amended by adding at the end the following new item:
``Sec. 4980F. Failure of insurer to
comply with certain standards
for health insurance
coverage.''.
SEC. 312. ENFORCEMENT WITH RESPECT TO SMALL EMPLOYERS.
(a) In General.--Chapter 47 of the Internal Revenue Code of 1986
(relating to excise taxes on certain group health plans) is amended by
inserting after section 5000 the following new section:
``SEC. 5000A. SMALL EMPLOYER REQUIREMENTS.
``(a) General Rule.--There is hereby imposed a tax on the failure
of any small employer to comply with the requirements applicable to
such employer under--
``(1) subchapter C of chapter 2 of subpart 2 of part A of
title XXVII of the Public Health Service Act;
``(2) section 2753 of the Public Health Service Act; and
``(3) chapter 2 of subpart C of part 7 of subtitle B of
title I of the Employee Retirement Income Security Act of 1974.
``(b) Amount of Tax.--The amount of tax imposed by subsection (a)
shall be equal to $100 for each day for each individual for which such
a failure occurs.
``(c) Limitation on Tax.--
``(1) Tax not to apply where failures corrected within 30
days.--No tax shall be imposed by subsection (a) with respect
to any failure if--
``(A) such failure was due to reasonable cause and
not to willful neglect, and
``(B) such failure is corrected during the 30-day
period (or such period as the Secretary may determine
appropriate) beginning on the 1st date any of the
individuals on whom the tax is imposed knew, or
exercising reasonable diligence would have known, that
such failure existed.
``(2) Waiver by secretary.--In the case of a failure which
is due to reasonable cause and not to willful neglect, the
Secretary may waive part or all of the tax imposed by
subsection (a) to the extent that the payment of such tax would
be excessive relative to the failure involved.''.
(b) Conforming Amendment.--The table of sections for such chapter
47 is amended by adding at the end the following new item:
``Sec. 5000A. Small employer
requirements.''.
SEC. 313. ENFORCEMENT BY EXCISE TAX ON QUALIFIED ASSOCIATIONS.
(a) In General.--Chapter 43 of the Internal Revenue Code of 1986
(relating to qualified pension, etc., plans), as amended by section
311, is amended by adding at the end the following new section:
``SEC. 4980G. FAILURE OF QUALIFIED ASSOCIATIONS, ETC., TO COMPLY WITH
CERTAIN STANDARDS FOR HEALTH INSURANCE COVERAGE.
``(a) Imposition of Tax.--
``(1) In general.--There is hereby imposed a tax on the
failure of a qualified association (as defined in section 2709A
of the Public Health Service Act and section 723A of the
Employee Retirement Income Security Act of 1974), church plan
(as defined in section 414(e)), multiemployer plan, or plan
maintained by a rural electric cooperative or a rural telephone
cooperative association (within the meaning of section 3(40) of
the Employee Retirement Income Security Act of 1974) to comply
with the requirements applicable to such association or plans
under--
``(A) subchapter C of chapter 2 of subpart 2 of
part A of title XXVII of the Public Health Service Act;
``(B) section 2753 of the Public Health Service
Act; and
``(C) subchapters A and B of chapter 3 of subpart C
of part 7 of the Employee Retirement Income Security
Act of 1974.
``(2) Exception.--Paragraph (1) shall not apply to a
failure by a qualified association, church plan, multiemployer
plan, or plan maintained by a rural electric cooperative or a
rural telephone cooperative association in a State if the
Secretary of Health and Human Services determines that the
State has in effect a regulatory enforcement mechanism that
provides adequate sanctions with respect to such a failure by
such a qualified association or plan.
``(b) Amount of Tax.--The amount of the tax imposed by subsection
(a) shall be $100 for each day during which such failure persists for
each person to which such failure relates. A rule similar to the rule
of section 4980D(b)(3) shall apply for purposes of this section.
``(c) Liability for Tax.--The tax imposed by this section shall be
paid by the qualified association or plan.
``(d) Limitations on Amount of Tax.--
``(1) Tax not to apply to failures corrected within 30
days.--No tax shall be imposed by subsection (a) on any failure
if--
``(A) such failure was due to reasonable cause and
not to willful neglect, and
``(B) such failure is corrected during the 30-day
period (or such period as the Secretary may determine
appropriate) beginning on the first date the qualified
association, church plan, multiemployer plan, or plan
maintained by a rural electric cooperative or a rural
telephone cooperative association knows, or exercising
reasonable diligence could have known, that such
failure existed.
``(2) Waiver by secretary.--In the case of a failure which
is due to reasonable cause and not to willful neglect, the
Secretary may waive part or all of the tax imposed by
subsection (a) to the extent that the payment of such tax would
be excessive relative to the failure involved.''.
(b) Conforming Amendment.--The table of sections for such chapter
43, as amended by section 311, is amended by adding at the end the
following new item:
``Sec. 4980G. Failure of qualified
associations, etc., to comply
with certain standards for
health insurance plans.''.
SEC. 314. DEDUCTION FOR HEALTH INSURANCE COSTS OF SELF-EMPLOYED
INDIVIDUALS.
(a) Full Deduction in 2001.--The table contained in section
162(l)(1)(B) of the Internal Revenue Code of 1986 (relating to special
rules for health insurance costs of self-employed individuals) is
amended--
(1) by striking ``2000 and 2001'' and all that follows; and
(2) by adding at the end the following:
``2000..................... 50
``2001 and thereafter...... 100.''.
(b) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1999.
SEC. 315. AMENDMENTS TO COBRA.
(a) Amendments to Internal Revenue Code of 1986.--
(1) Lower cost coverage options.--Subparagraph (A) of
section 4980B(f)(2) of the Internal Revenue Code of 1986
(relating to continuation coverage requirements of group health
plans) is amended to read as follows:
``(A) Type of benefit coverage.--The coverage must
consist of coverage which, as of the time the coverage
is being provided--
``(i) is identical to the coverage provided
under the plan to similarly situated
beneficiaries under the plan with respect to
whom a qualifying event has not occurred,
``(ii) is so identical, except such
coverage is offered with an annual $1,000
deductible, and
``(iii) is so identical, except such
coverage is offered with an annual $3,000
deductible.
If coverage under the plan is modified for any group of
similarly situated beneficiaries, the coverage shall
also be modified in the same manner for all individuals
who are qualified beneficiaries under the plan pursuant
to this subsection in connection with such group.''.
(2) Termination of cobra coverage after eligible for
employer-based coverage for 90 days.--Clause (iv) of section
4980B(f)(2)(B) of the Internal Revenue Code of 1986 (relating
to period of coverage) is amended--
(A) by striking ``or'' at the end of subclause (I),
(B) by redesignating subclause (II) as subclause
(III), and
(C) by inserting after subclause (I) the following:
``(II) eligible for such employer-
based coverage for more than 90 days,
or''.
(3) Reduction of period of coverage.--Clause (i) of section
4980B(f)(2)(B) of the Internal Revenue Code of 1986 (relating
to period of coverage) is amended by striking ``18 months''
each place it appears and inserting ``24 months''.
(4) Continuation coverage for dependent child.--Clause (i)
of section 4980B(f)(2)(B) of the Internal Revenue Code of 1986
is amended by adding at the end the following:
``(VI) Special rule for dependent
child.--In the case of a qualifying
event described in paragraph (3)(E),
the date that is 36 months after the
date on which the dependent child of
the covered employee ceases to be a
dependent child under the plan.''.
(b) Amendments to Employee Retirement Income Security Act of
1974.--
(1) Lower cost coverage options.--Paragraph (1) of section
602 of the Employee Retirement Income Security Act of 1974 (29
U.S.C. 1162(1)) (relating to continuation coverage requirements
of group health plans) is amended to read as follows:
``(1) Type of benefit coverage.--The coverage must consist
of coverage which, as of the time the coverage is being
provided--
``(A) is identical to the coverage provided under
the plan to similarly situated beneficiaries under the
plan with respect to whom a qualifying event has not
occurred,
``(B) is so identical, except such coverage is
offered with an annual $1,000 deductible, and
``(C) is so identical, except such coverage is
offered with an annual $3,000 deductible.
If coverage under the plan is modified for any group of
similarly situated beneficiaries, the coverage shall also be
modified in the same manner for all individuals who are
qualified beneficiaries under the plan pursuant to this
subsection in connection with such group.''.
(2) Termination of cobra coverage after eligible for
employer-based coverage for 90 days.--Subparagraph (D) of
section 602(2) of the Employee Retirement Income Security Act
of 1974 (29 U.S.C. 1162(2)(D)) (relating to period of coverage)
is amended--
(A) by striking ``or'' at the end of clause (i),
(B) by redesignating clause (ii) as clause (iii),
and
(C) by inserting after clause (i) the following:
``(ii) eligible for such employer-based
coverage for more than 90 days, or''.
(3) Reduction of period of coverage.--Subparagraph (A) of
section 602(2) of the Employee Retirement Income Security Act
of 1974 (29 U.S.C. 1162(2)(A)) (relating to period of coverage)
is amended by striking ``18 months'' each place it appears and
inserting ``24 months''.
(4) Continuation coverage for dependent child.--
Subparagraph (A) of section 602(2) of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1162(2)(A)) is amended
by adding at the end the following:
``(vi) Special rule for dependent child.--
In the case of a qualifying event described in
section 603(5), the date that is 36 months
after the date on which the dependent child of
the covered employee ceases to be a dependent
child under the plan.''.
(c) Amendments to Public Health Service Act.--
(1) Lower cost coverage options.--Paragraph (1) of section
2202 of the Public Health Service Act (42 U.S.C. 300bb-2(1))
(relating to continuation coverage requirements of group health
plans) is amended to read as follows:
``(1) Type of benefit coverage.--The coverage must consist
of coverage which, as of the time the coverage is being
provided--
``(A) is identical to the coverage provided under
the plan to similarly situated beneficiaries under the
plan with respect to whom a qualifying event has not
occurred,
``(B) is so identical, except such coverage is
offered with an annual $1,000 deductible, and
``(C) is so identical, except such coverage is
offered with an annual $3,000 deductible.
If coverage under the plan is modified for any group of
similarly situated beneficiaries, the coverage shall also be
modified in the same manner for all individuals who are
qualified beneficiaries under the plan pursuant to this
subsection in connection with such group.''.
(2) Termination of cobra coverage after eligible for
employer-based coverage for 90 days.--Subparagraph (D) of
section 2202(2) of the Public Health Service Act (42 U.S.C.
300bb-2(2)(D)) (relating to period of coverage) is amended--
(A) by striking ``or'' at the end of clause (i),
(B) by redesignating clause (ii) as clause (iii),
and
(C) by inserting after clause (i) the following:
``(ii) eligible for such employer-based
coverage for more than 90 days, or''.
(3) Reduction of period of coverage.--Subparagraph (A) of
section 2202(2) of the Public Health Service Act (42 U.S.C.
300bb-2(2)(A)) (relating to period of coverage) is amended by
striking ``18 months'' each place it appears and inserting ``24
months''.
(4) Continuation coverage for dependent child.--
Subparagraph (A) of section 2202(2) of the Public Health
Service Act (42 U.S.C. 300bb-2(2)(A)) is amended by adding at
the end the following:
``(vi) Special rule for dependent child.--
In the case of a qualifying event described in
section 2203(5), the date that is 36 months
after the date on which the dependent child of
the covered employee ceases to be a dependent
child under the plan.''.
(d) Effective Date.--The amendments made by this section shall
apply to qualifying events occurring after the date of the enactment of
this Act.
TITLE IV--PRIMARY AND PREVENTIVE CARE SERVICES
SEC. 401. IMPROVEMENT OF MEDICARE PREVENTIVE CARE SERVICES.
(a) Waiver of Coinsurance for Screening Mammography.--
(1) In general.--Section 1834(c)(1)(C) of the Social
Security Act (42 U.S.C. 1395m(c)(1)(C)) is amended by striking
``80 percent of''.
(2) Waiver of coinsurance in outpatient hospital
settings.--The third sentence of section 1866(a)(2)(A) of the
Social Security Act (42 U.S.C. 1395cc(a)(2)(A)) is amended by
inserting after ``1861(s)(10)(A)'' the following: ``, with
respect to screening mammography (as defined in section
1861(jj)),''.
(b) Coverage of Insulin Pumps.--
(1) Inclusion as item of durable medical equipment.--
Section 1861(n) of the Social Security Act (42 U.S.C. 1395x(n))
is amended by inserting before the semicolon the following: ``,
and includes insulin infusion pumps (as defined in subsection
(uu)) prescribed by the physician of an individual with Type I
diabetes who is experiencing severe swings of high and low
blood glucose levels and has successfully completed a training
program that meets standards established by the Secretary or
who has used such a pump without interruption for at least 18
months immediately before enrollment under part B''.
(2) Definition of insulin infusion pump.--Section 1861 of
the Social Security Act (42 U.S.C. 1395x) is amended by adding
at the end the following:
``Insulin Infusion Pump
``(uu) The term `insulin infusion pump' means an infusion pump,
approved by the Federal Food and Drug Administration, that provides for
the computerized delivery of insulin for individuals with diabetes in
lieu of multiple daily manual insulin injections.''.
(3) Payment for supplies relating to infusion pumps.--
Section 1834(a)(2)(A) of the Social Security Act (42 U.S.C.
1395m(a)(2)(A)) is amended--
(A) in clause (ii), by striking ``or'' at the end;
(B) in clause (iii), by inserting ``or'' at the
end; and
(C) by inserting after clause (iii) the following:
``(iv) which is an accessory used in
conjunction with an insulin infusion pump (as
defined in section 1861(uu)),''.
(c) Annual Screening Pap Smear and Pelvic Exams.--
(1) In general.--Section 1861(nn) of the Social Security
Act (42 U.S.C. 1395x(nn) is amended to read as follows:
``Screening Pap Smear; Screening Pelvic Exam
``(nn)(1) The term `screening pap smear' means a diagnostic
laboratory test consisting of a routine exfoliative cytology test
(Papanicolaou test) provided to a woman for the purpose of early
detection of cervical or vaginal cancer and includes a physician's
interpretation of the results of the test, if the individual involved
has not had such a test during the preceding year.
``(2) The term `screening pelvic exam' means a pelvic examination
provided to a woman if the woman involved has not had such an
examination during the preceding year, and includes a clinical breast
examination, relevant history-taking, medical decision-making, and
patient counseling.''.
(2) Waiver of coinsurance for pelvic exams.--Section
1833(a)(1) of the Social Security Act (42 U.S.C. 1395l(a)(1))
is amended--
(A) by striking ``and (S)'' and inserting ``(S)'';
and
(B) by striking the semicolon at the end and
inserting the following: ``, and (T) with respect to
services described in section 1861(nn)(2), 100 percent
of the payment basis established under section 1848;''.
(e) Effective Date.--The amendments made by this section shall
apply to items and services furnished on or after the date of enactment
of this Act.
SEC. 402. AUTHORIZATION OF APPROPRIATIONS FOR HEALTHY START PROGRAM.
(a) Authorization of Appropriations.--To enable the Secretary of
Health and Human Services to carry out the healthy start program
established under the authority of section 301 of the Public Health
Service Act (42 U.S.C. 241), there are authorized to be appropriated
$115,000,000 for fiscal year 2000, $150,000,000 for fiscal year 2001,
$250,000,000 for fiscal year 2002, and $300,000,000 for each of the
fiscal years 2003 through 2005.
(b) Model Projects.--
(1) In general.--Of the amount appropriated under
subsection (a) for a fiscal year, the Secretary of Health and
Human Services shall reserve $50,000,000 for such fiscal year
to be distributed to model projects determined to be eligible
under paragraph (2).
(2) Eligibility.--To be eligible to receive funds under
paragraph (1), a model project shall--
(A) have been one of the original 15 Healthy Start
projects; and
(B) be determined by Secretary of Health and Human
Services to have been successful in serving needy areas
and reducing infant mortality.
(3) Use of projects.--A model project that receives funding
under paragraph (1) shall be utilized as a resource center to
assist in the training of those individuals to be involved in
projects established under subsection (c). It shall be the goal
of such projects to become self-sustaining within the project
area.
(4) Provision of matching funds.--In providing assistance
to a project under this subsection, the Secretary of Health and
Human Services shall ensure that--
(A) with respect to fiscal year 2000, the project
shall make non-Federal contributions (in cash or in-
kind) towards the costs of such project in an amount
equal to not less than 20 percent of such costs;
(B) with respect to fiscal year 2001, the project
shall make non-Federal contributions (in cash or in-
kind) towards the costs of such project in an amount
equal to not less than 30 percent of such costs;
(C) with respect to fiscal year 2002, the project
shall make non-Federal contributions (in cash or in-
kind) towards the costs of such project in an amount
equal to not less than 40 percent of such costs; and
(D) with respect to each of the fiscal years 2003
through 2005, the project shall make non-Federal
contributions (in cash or in-kind) towards the costs of
such project in an amount equal to not less than 50
percent of such costs for each such fiscal year.
(c) New Projects.--Of the amount appropriated under subsection (a)
for a fiscal year, the Secretary of Health and Human Services shall
allocate amounts remaining after the reservation under subsection (b)
for such fiscal year among new demonstration projects and existing
special projects that have proven to be successful as determined by the
Secretary of Health and Human Services. Such projects shall be
community-based and shall attempt to replicate healthy start model
projects that have been determined by the Secretary of Health and Human
Services to be successful.
SEC. 403. REAUTHORIZATION OF CERTAIN PROGRAMS PROVIDING PRIMARY AND
PREVENTIVE CARE.
(a) Tuberculosis Prevention Grants.--Section 317(j)(1) of the
Public Health Service Act (42 U.S.C. 247b(j)(1)) is amended by striking
``2002'' and inserting ``2003''.
(b) Sexually Transmitted Diseases.--Section 318(e)(1) of the Public
Health Service Act (42 U.S.C. 247c(e)(1)) is amended--
(1) by striking ``and such sums'' and inserting ``such
sums'';
(2) by striking ``1998'' and inserting ``1999''; and
(3) by inserting before the period the following: ``,
$130,000,000 for each of the fiscal years 2000 and 2001, and
such sums as may be necessary for each of the fiscal years 2002
through 2004''.
(c) Family Planning Project Grants.--Section 1001(d) of the Public
Health Service Act (42 U.S.C. 300(d)) is amended--
(1) by striking ``and $158,400,000'' and inserting
``$158,400,000''; and
(2) by inserting before the period the following: ``;
$430,000,000 for fiscal year 2000; and such sums as may be
necessary for each of the fiscal years 2001 through 2003''.
(d) Breast and Cervical Cancer Prevention.--Section 1510(a) of the
Public Health Service Act (42 U.S.C. 300n-5(a)) is amended--
(1) by striking ``and such sums'' and inserting ``such
sums''; and
(2) by inserting before the period the following: ``,
$185,000,000 for fiscal year 2000, and such sums as may be
necessary for each of the fiscal years 2001 through 2003''.
(e) Preventive Health and Health Services Block Grant.--Section
1901(a) of the Public Health Service Act (42 U.S.C. 300w(a)) is amended
by striking ``$205,000,000'' and inserting ``$235,000,000''.
(f) Maternal and Child Health Services Block Grant.--Section 501(a)
of the Social Security Act (42 U.S.C. 701(a)) is amended by striking
``$705,000,000 for fiscal year 1994 and each fiscal year thereafter''
and inserting ``$705,000,000 for fiscal years 1994 through 1999,
$800,000,000 for fiscal year 2000, and such sums as may be necessary
for each of the fiscal years 2001 through 2003''.
SEC. 404. COMPREHENSIVE SCHOOL HEALTH EDUCATION PROGRAM.
(a) Purpose.--It is the purpose of this section to establish a
comprehensive school health education and prevention program for
elementary and secondary school students.
(b) Program Authorized.--The Secretary of Education (referred to in
this section as the ``Secretary''), through the Office of Comprehensive
School Health Education established in subsection (e), shall award
grants to States from allotments under subsection (c) to enable such
States to--
(1) award grants to local or intermediate educational
agencies, and consortia thereof, to enable such agencies or
consortia to establish, operate, and improve local programs of
comprehensive health education and prevention, early health
intervention, and health education, in elementary and secondary
schools (including preschool, kindergarten, intermediate, and
junior high schools); and
(2) develop training, technical assistance, and
coordination activities for the programs assisted pursuant to
paragraph (1).
(c) Reservations and State Allotments.--
(1) Reservations.--From the sums appropriated pursuant to
the authority of subsection (f) for any fiscal year, the
Secretary shall reserve--
(A) 1 percent for payments to Guam, American Samoa,
the Virgin Islands, the Republic of the Marshall
Islands, the Federated States of Micronesia, the
Northern Mariana Islands, and the Republic of Palau, to
be allotted in accordance with their respective needs;
and
(B) 1 percent for payments to the Bureau of Indian
Affairs.
(2) State allotments.--From the remainder of the sums not
reserved under paragraph (1), the Secretary shall allot to each
State an amount which bears the same ratio to the amount of
such remainder as the school-age population of the State bears
to the school-age population of all States, except that no
State shall be allotted less than an amount equal to 0.5
percent of such remainder.
(3) Reallotment.--The Secretary may reallot any amount of
any allotment to a State to the extent that the Secretary
determines that the State will not be able to obligate such
amount within 2 years of allotment. Any such reallotment shall
be made on the same basis as an allotment under paragraph (2).
(d) Use of Funds.--Grant funds provided to local or intermediate
educational agencies, or consortia thereof, under this section may be
used to improve elementary and secondary education in the areas of--
(1) personal health and fitness;
(2) prevention of chronic diseases;
(3) prevention and control of communicable diseases;
(4) nutrition;
(5) substance use and abuse;
(6) accident prevention and safety;
(7) community and environmental health;
(8) mental and emotional health;
(9) parenting and the challenges of raising children; and
(10) the effective use of the health services delivery
system.
(e) Office of Comprehensive School Health Education.--The Secretary
shall establish within the Office of the Secretary an Office of
Comprehensive School Health Education which shall have the following
responsibilities:
(1) To recommend mechanisms for the coordination of school
health education programs conducted by the various departments
and agencies of the Federal Government.
(2) To advise the Secretary on formulation of school health
education policy within the Department of Education.
(3) To disseminate information on the benefits to health
education of utilizing a comprehensive health curriculum in
schools.
(f) Authorization of Appropriations.--
(1) In general.--There are authorized to be appropriated
$50,000,000 for fiscal year 2000 and such sums as may be
necessary for each of the fiscal years 2001 and 2002 to carry
out this section.
(2) Availability.--Funds appropriated pursuant to the
authority of paragraph (1) in any fiscal year shall remain
available for obligation and expenditure until the end of the
fiscal year succeeding the fiscal year for which such funds
were appropriated.
SEC. 405. COMPREHENSIVE EARLY CHILDHOOD HEALTH EDUCATION PROGRAM.
(a) Purpose.--It is the purpose of this section to establish a
comprehensive early childhood health education program.
(b) Program.--The Secretary of Health and Human Services (referred
to in this section as the ``Secretary'') shall conduct a program of
awarding grants to agencies conducting Head Start training to enable
such agencies to provide training and technical assistance to Head
Start teachers and other child care providers. Such program shall--
(1) establish a training system through the Head Start
agencies and organizations conducting Head Start training for
the purpose of enhancing teacher skills and providing
comprehensive early childhood health education curriculum;
(2) enable such agencies and organizations to provide
training to day care providers in order to strengthen the
skills of the early childhood workforce in providing health
education;
(3) provide technical support for health education programs
and curricula; and
(4) provide cooperation with other early childhood
providers to ensure coordination of such programs and the
transition of students into the public school environment.
(c) Use of Funds.--Grant funds under this section may be used to
provide training and technical assistance in the areas of--
(1) personal health and fitness;
(2) prevention of chronic diseases;
(3) prevention and control of communicable diseases;
(4) dental health;
(5) nutrition;
(6) substance use and abuse;
(7) accident prevention and safety;
(8) community and environmental health;
(9) mental and emotional health; and
(10) strengthening the role of parent involvement.
(d) Reservation for Innovative Programs.--The Secretary shall
reserve 5 percent of the funds appropriated pursuant to the authority
of subsection (e) in each fiscal year for the development of innovative
model health education programs or curricula.
(e) Authorization of Appropriations.--There are authorized to be
appropriated $40,000,000 for fiscal year 2000 and such sums as may be
necessary for each of the fiscal years 2001 and 2002 to carry out this
section.
SEC. 406. ADOLESCENT FAMILY LIFE AND ABSTINENCE.
(a) Definitions.--Section 2002(a)(4)(G) of the Public Health
Service Act (42 U.S.C. 300z-1(a)(4)(G)) is amended by inserting ``and
abstinence'' after ``adoption''.
(b) Geographic Diversity.--Section 2005 of the Public Health
Service Act (42 U.S.C. 300z-4) is amended--
(1) by redesignating subsections (b) and (c) as subsections
(c) and (d), respectively; and
(2) by inserting after subsection (a) the following:
``(b) In approving applications for grants for demonstration
projects for services under this title, the Secretary shall, to the
maximum extent practicable, ensure adequate representation of both
urban and rural areas.''.
(c) Simplified Application Process.--Section 2006 of the Public
Health Service Act (42 U.S.C. 300z-5) is amended by adding at the end
following:
``(g) The Secretary shall develop and implement a simplified and
expedited application process for applicants seeking less than $15,000
of funds available under this title for a demonstration project.''.
(d) Authorization of Appropriations.--Section 2010(a) of the Public
Health Service Act (42 U.S.C. 300z-9) is amended to read as follows:
``(a) For the purpose of carrying out this title, there are
authorized to be appropriated $75,000,000 for each of the fiscal years
2000 through 2004.''.
TITLE V--PATIENT'S RIGHT TO DECLINE MEDICAL TREATMENT
SEC. 501. PATIENT'S RIGHT TO DECLINE MEDICAL TREATMENT.
(a) Right To Decline Medical Treatment.--
(1) Rights of competent adults.--
(A) In general.--Except as provided in subparagraph
(B), a State may not restrict the right of a competent
adult to consent to, or to decline, medical treatment.
(B) Limitations.--
(i) Affect on third parties.--A State may
impose limitations on the right of a competent
adult to decline treatment if such limitations
protect third parties (including minor
children) from harm.
(ii) Treatment which is not medically
indicated.--Nothing in this subsection shall be
construed to require that any individual be
offered, or to state that any individual may
demand, medical treatment which the health care
provider does not have available, or which is,
under prevailing medical standards, either
futile or otherwise not medically indicated.
(2) Rights of incapacitated adults.--
(A) In general.--Except as provided in subparagraph
(B)(i) of paragraph (1), States may not restrict the
right of an incapacitated adult to consent to, or to
decline, medical treatment as exercised through the
documents specified in this paragraph, or through
similar documents or other written methods of directive
which evidence the adult's treatment choices.
(B) Advance directives and powers of attorney.--
(i) In general.--In order to facilitate the
communication, despite incapacity, of an
adult's treatment choices, the Secretary, in
consultation with the Attorney General, shall
develop a national advance directive form
that--
(I) shall not limit or otherwise
restrict, except as provided in
subparagraph (B)(i) of paragraph (1),
an adult's right to consent to, or to
decline, medical treatment; and
(II) shall, at minimum--
(aa) provide the means for
an adult to declare such
adult's own treatment choices
in the event of a terminal
condition;
(bb) provide the means for
an adult to declare, at such
adult's option, treatment
choices in the event of other
conditions which are medically
incurable, and from which such
adult likely will not recover;
and
(cc) provide the means by
which an adult may, at such
adult's option, declare such
adult's wishes with respect to
all forms of medical treatment,
including forms of medical
treatment such as the provision
of nutrition and hydration by
artificial means which may be,
in some circumstances,
relatively nonburdensome.
(ii) National durable power of attorney
form.--The Secretary, in consultation with the
Attorney General, shall develop a national
durable power of attorney form for health care
decisionmaking. The form shall provide a means
for any adult to designate another adult or
adults to exercise the same decisionmaking
powers which would otherwise be exercised by
the patient if the patient were competent.
(iii) Honored by all health care
providers.--The national advance directive and
durable power of attorney forms developed by
the Secretary shall be honored by all health
care providers.
(iv) Limitations.--No individual shall be
required to execute an advance directive. This
section makes no presumption concerning the
intention of an individual who has not executed
an advance directive. An advance directive shall be sufficient, but not
necessary, proof of an adult's treatment choices with respect to the
circumstances addressed in the advance directive.
(C) Definition.--For purposes of this paragraph,
the term ``incapacity'' means the inability to
understand or to communicate concerning the nature and
consequences of a health care decision (including the
intended benefits and foreseeable risks of, and
alternatives to, proposed treatment options), and to
reach an informed decision concerning health care.
(3) Health care providers.--
(A) In general.--No health care provider may
provide treatment to an adult contrary to the adult's
wishes as expressed personally, by an advance directive
as provided for in paragraph (2)(B), or by a similar
written advance directive form or another written
method of directive which clearly and convincingly
evidence the adult's treatment choices. A health
provider who acts in good faith pursuant to the
preceding sentence shall be immune from criminal or
civil liability or discipline for professional
misconduct.
(B) Health care providers under the medicare and
medicaid programs.--Any health care provider who
knowingly provides services to an adult contrary to the
adult's wishes as expressed personally, by an advance
directive as provided for in paragraph (2)(B), or by a
similar written advance directive form or another
written method of directive which clearly and
convincingly evidence the adult's treatment choices,
shall be denied payment for such services under titles
XVIII and XIX of the Social Security Act.
(C) Transfers.--Health care providers who object to
the provision of medical care in accordance with an
adult's wishes shall transfer the adult to the care of
another health care provider.
(4) Definition.--For purposes of this subsection, the term
``adult'' means--
(A) an individual who is 18 years of age or older;
or
(B) an emancipated minor.
(b) Federal Right Enforceable in Federal Courts.--The rights
recognized in this section may be enforced by filing a civil action in
an appropriate district court of the United States.
(c) Suicide and Homicide.--Nothing in this section shall be
construed to permit, condone, authorize, or approve suicide or mercy
killing, or any affirmative act to end a human life.
(d) Rights Granted by States.--Nothing in this section shall impair
or supersede rights granted by State law which exceed the rights
recognized by this section.
(e) Effect on Other Laws.--
(1) In general.--Except as specified in paragraph (2),
written policies and written information adopted by health care
providers pursuant to sections 4206 and 4751 of the Omnibus
Budget Reconciliation Act of 1990 (Public Law 101-508), shall
be modified within 6 months after the enactment of this section
to conform to the provisions of this section.
(2) Delay period for uniform forms.--Health care providers
shall modify any written forms distributed as written
information under sections 4206 and 4751 of the Omnibus Budget
Reconciliation Act of 1990 (Public Law 101-508) not later than
6 months after promulgation of the forms referred to in clauses
(i) and (ii) of subsection (a)(2)(B) by the Secretary.
(f) Information Provided to Certain Individuals.--The Secretary
shall provide on a periodic basis written information regarding an
individual's right to consent to, or to decline, medical treatment as
provided in this section to individuals who are beneficiaries under
titles II, XVI, XVIII, and XIX of the Social Security Act.
(g) Recommendations to Congress on Issues Relating to a Patient's
Right of Self-Determination.--Not later than 180 days after the date of
the enactment of this Act, and annually thereafter for a period of 3
years, the Secretary shall provide recommendations to Congress
concerning the medical, legal, ethical, social, and educational issues
related to in this section. In developing recommendations under this
subsection the Secretary shall address the following issues:
(1) The contents of the forms referred to in clauses (i)
and (ii) of subsection (a)(2)(B).
(2) Issues pertaining to the education and training of
health care professionals concerning patients' self-
determination rights.
(3) Issues pertaining to health care professionals' duties
with respect to patients' rights, and health care
professionals' roles in identifying, assessing, and presenting
for patient consideration medically indicated treatment
options.
(4) Issues pertaining to the education of patients
concerning their rights to consent to, and decline, treatment,
including how individuals might best be informed of such rights
prior to hospitalization and how uninsured individuals, and
individuals not under the regular care of a physician or
another provider, might best be informed of their rights.
(5) Issues relating to appropriate standards to be adopted
concerning decisionmaking by incapacitated adult patients whose
treatment choices are not known.
(6) Such other issues as the Secretary may identify.
(h) Effective Date.--
(1) In general.--This section shall take effect on the date
that is 6 months after the date of enactment of this Act.
(2) Subsection (g).--The provisions of subsection (g) shall
take effect on the date of enactment of this Act.
TITLE VI--PRIMARY AND PREVENTIVE CARE PROVIDERS
SEC. 601. INCREASED MEDICARE REIMBURSEMENT FOR PHYSICIAN ASSISTANTS,
NURSE PRACTITIONERS, AND CLINICAL NURSE SPECIALISTS.
(a) Fee Schedule Amount.--Section 1833(a)(1)(O) (42 U.S.C.
1395l(a)(1)(O)) is amended by striking ``85 percent'' and inserting
``90 percent'' each place it appears.
(b) Technical Amendments.--Section 1833(a)(1)(O) (42 U.S.C.
1395l(a)(1)(O)) is amended--
(1) by striking ``clinic'' and inserting ``clinical''; and
(2) by striking the semicolon at the end and inserting a
comma.
(c) Effective Date.--The amendments made by this section shall
apply with respect to services furnished and supplies provided on and
after January 1, 2000.
SEC. 602. REQUIRING COVERAGE OF CERTAIN NONPHYSICIAN PROVIDERS UNDER
THE MEDICAID PROGRAM.
(a) In General.--Section 1905(a) of the Social Security Act (42
U.S.C. 1396d(a)) is amended--
(1) in paragraph (26), by striking ``and'' at the end;
(2) by redesignating paragraph (27) as paragraph (28); and
(3) by inserting after paragraph (26) the following:
``(27) services furnished by a physician assistant, nurse
practitioner, clinical nurse specialist (as defined in section
1861(aa)(5)), and certified registered nurse anesthetist (as
defined in section 1861(bb)(2)); and''.
(b) Conforming Amendment.--Section 1902(a)(10)(C)(iv) of the Social
Security Act (42 U.S.C. 1396a(a)(10)(C)(iv)) is amended by inserting
``and (27)'' after ``(24)''.
(c) Effective Date.--The amendments made by this section shall
apply to services furnished under title XIX of the Social Security Act
(42 U.S.C. 1396 et seq.) beginning with the first fiscal year quarter
that begins after the date of enactment of this Act.
SEC. 603. MEDICAL STUDENT TUTORIAL PROGRAM GRANTS.
Part C of title VII of the Public Health Service Act (42 U.S.C.
293j et seq.), as amended by the Omnibus Consolidated and Emergency
Supplemental Appropriations Act, 1999 (Public Law 105-277), is amended
by adding at the end thereof the following:
``SEC. 749. MEDICAL STUDENT TUTORIAL PROGRAM GRANTS.
``(a) Establishment.--The Secretary shall establish a program to
award grants to eligible schools of medicine or osteopathic medicine to
enable such schools to provide medical students for tutorial programs
or as participants in clinics designed to interest high school or
college students in careers in general medical practice.
``(b) Application.--To be eligible to receive a grant under this
section, a school of medicine or osteopathic medicine shall prepare and
submit to the Secretary an application at such time, in such manner,
and containing such information as the Secretary may require, including
assurances that the school will use amounts received under the grant in
accordance with subsection (c).
``(c) Use of Funds.--
``(1) In general.--Amounts received under a grant awarded
under this section shall be used to--
``(A) fund programs under which students of the
grantee are provided as tutors for high school and
college students in the areas of mathematics, science,
health promotion and prevention, first aide, nutrition
and prenatal care;
``(B) fund programs under which students of the
grantee are provided as participants in clinics and
seminars in the areas described in paragraph (1); and
``(C) conduct summer institutes for high school and
college students to promote careers in medicine.
``(2) Design of programs.--The programs, institutes, and
other activities conducted by grantees under paragraph (1)
shall be designed to--
``(A) give medical students desiring to practice
general medicine access to the local community;
``(B) provide information to high school and
college students concerning medical school and the
general practice of medicine; and
``(C) promote careers in general medicine.
``(d) Authorization of Appropriations.--There are authorized to be
appropriated to carry out this section, $5,000,000 for fiscal year
2000, and such sums as may be necessary for fiscal year 2001.''.
SEC. 604. GENERAL MEDICAL PRACTICE GRANTS.
Part C of title VII of the Public Health Service Act (as amended by
section 603) is further amended by adding at the end thereof the
following:
``SEC. 749A. GENERAL MEDICAL PRACTICE GRANTS.
``(a) Establishment.--The Secretary shall establish a program to
award grants to eligible public or private nonprofit schools of
medicine or osteopathic medicine, hospitals, residency programs in
family medicine or pediatrics, or to a consortium of such entities, to
enable such entities to develop effective strategies for recruiting
medical students interested in the practice of general medicine and
placing such students into general practice positions upon graduation.
``(b) Application.--To be eligible to receive a grant under this
section, an entity of the type described in subsection (a) shall
prepare and submit to the Secretary an application at such time, in
such manner, and containing such information as the Secretary may
require, including assurances that the entity will use amounts received
under the grant in accordance with subsection (c).
``(c) Use of Funds.--Amounts received under a grant awarded under
this section shall be used to fund programs under which effective
strategies are developed and implemented for recruiting medical
students interested in the practice of general medicine and placing
such students into general practice positions upon graduation.
``(d) Authorization of Appropriations.--There are authorized to be
appropriated to carry out this section, $25,000,000 for each of the
fiscal years 2000 through 2002, and such sums as may be necessary for
fiscal years thereafter.''.
TITLE VII--COST CONTAINMENT
SEC. 701. NEW DRUG CLINICAL TRIALS PROGRAM.
Part B of title IV of the Public Health Service Act (42 U.S.C. 284
et seq.) is amended by adding at the end the following:
``SEC. 409C. NEW DRUG CLINICAL TRIALS PROGRAM.
``(a) In General.--The Director of the National Institutes of
Health (referred to in this section as the `Director') is authorized to
establish and implement a program for the conduct of clinical trials
with respect to new drugs and disease treatments determined to be
promising by the Director. In determining the drugs and disease
treatments that are to be the subject of such clinical trials, the
Director shall give priority to those drugs and disease treatments
targeted toward the diseases determined--
``(1) to be the most costly to treat;
``(2) to have the highest mortality; or
``(3) to affect the greatest number of individuals.
``(b) Authorization of Appropriations.--There are authorized to be
appropriated to carry out this section, $120,000,000 for fiscal year
2000, and such sums as may be necessary for each of the fiscal years
2001 through 2004.''.
SEC. 702. MEDICAL TREATMENT EFFECTIVENESS.
(a) Research on Cost-Effective Methods of Health Care.--Section 926
of the Public Health Service Act (42 U.S.C. 299c-5) is amended--
(1) in subsection (a)--
(A) by striking ``1994, and'' and inserting
``1994,''; and
(B) by inserting before the period the following:
``, and such sums as may be necessary for each of the
fiscal years 2000 through 2002''; and
(2) by adding at the end the following new subsection:
``(f) Use of Additional Appropriations.--Within amounts
appropriated under subsection (a) for each of the fiscal years 2000
through 2002 that are in excess of the amounts appropriated under such
subsection for fiscal year 1999, the Secretary shall give priority to
expanding research conducted to determine the most cost-effective
methods of health care and for developing and disseminating new
practice guidelines related to such methods. In utilizing such amounts,
the Secretary shall give priority to diseases and disorders that the
Secretary determines are the most costly to the United States and
evidence a wide variation in current medical practice.''.
(b) Research on Medical Treatment Outcomes.--
(1) Imposition of tax on health insurance policies.--
(A) In general.--Chapter 36 of the Internal Revenue
Code of 1986 (relating to certain other excise taxes)
is amended by adding at the end the following:
``Subchapter F--Tax on Health Insurance Policies
``Sec. 4491. Imposition of tax.
``Sec. 4492. Liability for tax.
``SEC. 4491. IMPOSITION OF TAX.
``(a) General Rule.--There is hereby imposed a tax equal to .001
cent on each dollar, or fractional part thereof, of the premium paid on
a policy of health insurance.
``(b) Definition.--For purposes of subsection (a), the term `policy
of health insurance' means any policy or other instrument by whatever
name called whereby a contract of insurance is made, continued, or
renewed with respect to the health of an individual or group of
individuals.
``SEC. 4492. LIABILITY FOR TAX.
``The tax imposed by this subchapter shall be paid, on the basis of
a return, by any person who makes, signs, issues, or sells any of the
documents and instruments subject to the tax, or for whose use or
benefit the same are made, signed, issued, or sold. The United States
or any agency or instrumentality thereof shall not be liable for the
tax.''.
(B) Conforming amendment.--The table of subchapters
for chapter 36 of such Code is amended by adding at the
end the following:
``Subchapter F. Tax on health insurance
policies.''.
(2) Establishment of trust fund.--
(A) In general.--Subchapter A of chapter 98 of such
Code (relating to trust fund code) is amended by adding
at the end the following:
``SEC. 9511. TRUST FUND FOR MEDICAL TREATMENT OUTCOMES RESEARCH.
``(a) Creation of Trust Fund.--There is established in the Treasury
of the United States a trust fund to be known as the `Trust Fund for
Medical Treatment Outcomes Research' (referred to in this section as
the `Trust Fund'), consisting of such amounts as may be appropriated or
credited to the Trust Fund as provided in this section or section
9602(b).
``(b) Transfers to Trust Fund.--There is hereby appropriated to the
Trust Fund an amount equivalent to the taxes received in the Treasury
under section 4491 (relating to tax on health insurance policies).
``(c) Distribution of Amounts in Trust Fund.--On an annual basis
the Secretary shall distribute the amounts in the Trust Fund to the
Secretary of Health and Human Services. Such amounts shall be available
to the Secretary of Health and Human Services to pay for research
activities related to medical treatment outcomes.''.
(B) Conforming amendment.--The table of sections
for subchapter A of chapter 98 of such Code is amended
by adding at the end the following:
``Sec. 9511. Trust Fund for Medical
Treatment Outcomes Research.''.
(3) Effective date.--The amendments made by this subsection
shall apply to policies issued after December 31, 1999.
SEC. 703. HEALTH CARE COST CONTAINMENT AND QUALITY INFORMATION PROGRAM.
(a) Grant Program.--
(1) In general.--The Secretary of Health and Human Services
(referred to in this section as the ``Secretary'') shall make
grants to States that establish or operate health care cost
containment and quality information systems (as defined in
subsection (f)(1)). In order to be eligible for a grant under
this section, a State must establish or operate a system which,
at a minimum, meets the Federal standards established under
subsection (c).
(2) Use of funds.--States may use grant funds received
under this section only to establish a health care cost
containment and quality information system or to improve an
existing system operated by the State.
(b) Submission of Applications.--To be eligible for a grant under
this section, a State must submit an application to the Secretary
within 2 years after the date of the enactment of this section. Such
application shall be submitted in a manner determined appropriate by
the Secretary and shall include the designation of a State agency that
will operate the health care cost containment and quality information
system for the State. The Secretary shall approve or disapprove a State
application within 6 months after its submission.
(c) Minimum Federal Standards.--Not later than 6 months after the
date of the enactment of this section, the Secretary, after
consultation with the Agency for Health Care Policy and Research, other
Federal agencies, the Joint Commission on Accreditation of Hospitals,
States, health care providers, consumers, insurers, health maintenance
organizations, businesses, academic health centers, and labor
organizations that purchase health care, shall establish Federal
standards for the operation of health care cost containment and quality
information systems by States receiving grants under this section.
(d) Collection and Public Dissemination of Information by States.--
(1) In general.--A State receiving a grant under this
section shall require that a health care cost containment and
quality information system will collect at least the
information described in paragraph (2) and publicly disseminate
such information in a useful format to appropriate persons such
as businesses, consumers of health care services, labor
organizations, health plans, hospitals, and other States.
(2) Information described.--The information described in
this paragraph is the following:
(A) Information on hospital charges.
(B) Clinical data.
(C) Demographic data.
(D) Information regarding treatment of individuals
by particular health care providers.
(3) Privacy and confidentiality.--The State cost
containment and quality information system shall ensure that
patient privacy and confidentiality is protected at all times.
(e) Compliance.--If the Secretary determines that a State receiving
grant funds under this section has failed to operate a system in
accordance with the terms of its approved application, the Secretary
may withhold payment of such funds until the State remedies such
noncompliance.
(f) Definitions.--For purposes of this section--
(1) the term ``health care cost containment and quality
information system'' means a system which is established or
operated by a State in order to collect and disseminate the
information described in subsection (d)(2) in accordance with
subsection (d)(1) for the purpose of providing information on
health care costs and outcomes in the State; and
(2) the term ``State'' means a State, the District of
Columbia, the Commonwealth of Puerto Rico, the Virgin Islands,
Guam, American Samoa, and includes the Commonwealth of the
Northern Mariana Islands.
(g) Authorization.--
(1) In general.--There are authorized to be appropriated
for the purpose of carrying out this section not more than
$150,000,000 for fiscal years 2000 through 2002, and such sums
as may be necessary thereafter, to remain available until
expended.
(2) Allocation to states.--The Secretary shall allocate the
amounts available for grants under this section in any fiscal
year in accordance with a formula developed by the Secretary
which takes into account--
(A) the number of hospitals in a State relative to
the total number of hospitals in all States;
(B) the population of the State relative to the
total population of all States; and
(C) the type of system operated or intended to be
operated by the State, including whether the State
establishes an independent State agency to operate the
system.
TITLE VIII--TAX INCENTIVES FOR PURCHASE OF QUALIFIED LONG-TERM CARE
INSURANCE
SEC. 801. CREDIT FOR QUALIFIED LONG-TERM CARE PREMIUMS.
(a) General Rule.--Subpart C of part IV of subchapter A of chapter
1 of the Internal Revenue Code of 1986 (relating to refundable credits)
is amended by redesignating section 35 as section 36 and by inserting
after section 34 the following:
``SEC. 35. LONG-TERM CARE INSURANCE CREDIT.
``(a) General Rule.--In the case of an individual, there shall be
allowed as a credit against the tax imposed by this subtitle for the
taxable year an amount equal to the applicable percentage of the
premiums for a qualified long-term care insurance contract (as defined
in section 7702B(b)) paid during such taxable year for such individual
or the spouse of such individual.
``(b) Applicable Percentage.--
``(1) In general.--For purposes of this section, the term
`applicable percentage' means 28 percent reduced (but not below
zero) by 1 percentage point for each $1,000 (or fraction
thereof) by which the taxpayer's adjusted gross income for the
taxable year exceeds the base amount.
``(2) Base amount.--For purposes of paragraph (1) the term
`base amount' means--
``(A) except as otherwise provided in this
paragraph, $25,000,
``(B) $40,000 in the case of a joint return, and
``(C) zero in the case of a taxpayer who--
``(i) is married at the close of the
taxable year (within the meaning of section
7703) but does not file a joint return for such
taxable year, and
``(ii) does not live apart from the
taxpayer's spouse at all times during the
taxable year.
``(c) Coordination With Medical Expense Deduction.--Any amount
allowed as a credit under this section shall not be taken into account
under section 213.''.
(b) Conforming Amendment.--The table of sections for such subpart C
is amended by striking the item relating to section 35 and inserting
the following:
``Sec. 35. Long-term care insurance
credit.
``Sec. 36. Overpayments of tax.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1999.
SEC. 802. INCLUSION OF QUALIFIED LONG-TERM CARE INSURANCE IN CAFETERIA
PLANS AND FLEXIBLE SPENDING ARRANGEMENTS.
(a) Cafeteria Plans.--The last sentence of section 125(f) of the
Internal Revenue Code of 1986 (defining qualified benefits) is amended
by striking ``shall not'' and inserting ``shall''.
(b) Flexible Spending Arrangements.--Section 106(c) of the Internal
Revenue Code of 1986 (relating to contributions by employer to accident
and health plans) is amended--
(1) in paragraph (1), by striking ``include'' and inserting
``shall not''; and
(2) in the heading, by striking ``Inclusion'' and inserting
``Exclusion''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1998.
SEC. 803. EXCLUSION FROM GROSS INCOME FOR AMOUNTS RECEIVED ON
CANCELLATION OF LIFE INSURANCE POLICIES AND USED FOR
QUALIFIED LONG-TERM CARE INSURANCE CONTRACTS.
(a) In General.--
(1) Exclusion from gross income.--
(A) In general.--Part III of subchapter B of
chapter 1 of the Internal Revenue Code of 1986
(relating to items specifically excluded from gross
income) is amended by redesignating section 139 as
section 140 and by inserting after section 138 the
following new section:
``SEC. 139. AMOUNTS RECEIVED ON CANCELLATION, ETC. OF LIFE INSURANCE
CONTRACTS AND USED TO PAY PREMIUMS FOR QUALIFIED LONG-
TERM CARE INSURANCE.
``No amount (which but for this section would be includible in the
gross income of an individual) shall be included in gross income on the
whole or partial surrender, cancellation, or exchange of any life
insurance contract during the taxable year if--
``(1) such individual has attained age 59\1/2\ on or before
the date of the transaction, and
``(2) the amount otherwise includible in gross income is
used during such year to pay for any qualified long-term care
insurance contract (as defined in section 7702B(b)) which--
``(A) is for the benefit of such individual or the
spouse of such individual if such spouse has attained
age 59\1/2\ on or before the date of the transaction,
and
``(B) may not be surrendered for cash.''.
(B) Conforming amendment.--The table of sections
for such part III is amended by striking the item
relating to section 139 and inserting the following:
``Sec. 139. Amounts received on
cancellation, etc. of life
insurance contracts and used to
pay premiums for qualified
long-term care insurance.
``Sec. 140. Cross references to other
Acts.''.
(2) Certain exchanges not taxable.--Section 1035(a) of such
Code (relating to certain exchanges of insurance contracts) is
amended by striking the period at the end of paragraph (3) and
inserting ``; or'', and by adding at the end the following:
``(4) in the case of an individual who has attained age
59\1/2\, a contract of life insurance or an endowment or
annuity contract for a qualified long-term care insurance
contract (as defined in section 7702B(b)), if the qualified
long-term care insurance contract may not be surrendered for
cash.''.
(b) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1999.
SEC. 804. USE OF GAIN FROM SALE OF PRINCIPAL RESIDENCE FOR PURCHASE OF
QUALIFIED LONG-TERM HEALTH CARE INSURANCE.
(a) In General.--Subsection (d) of section 121 of the Internal
Revenue Code of 1986 (relating to exclusion of gain from sale of
principal) is amended by adding at the end the following:
``(9) Eligibility of home equity conversion sale-leaseback
transaction for exclusion.--
``(A) In general.--For purposes of this section,
the term `sale or exchange' includes a home equity
conversion sale-leaseback transaction.
``(B) Home equity conversion sale-leaseback
transaction.--For purposes of subparagraph (A), the
term `home equity conversion sale-leaseback' means a
transaction in which--
``(i) the seller-lessee--
``(I) sells property which during
the 5-year period ending on the date of
the transaction has been owned and used as a principal residence by
such seller-lessee for periods aggregating 2 years or more,
``(II) uses a portion of the
proceeds from such sale to purchase a
qualified long-term care insurance
contract (as defined in section
7702B(b)), which contract may not be
surrendered for cash,
``(III) obtains occupancy rights in
such property pursuant to a written
lease requiring a fair rental, and
``(IV) receives no option to
repurchase the property at a price less
than the fair market price of the
property unencumbered by any leaseback
at the time such option is exercised,
and
``(ii) the purchaser-lessor--
``(I) is a person,
``(II) is contractually responsible
for the risks and burdens of ownership
and receives the benefits of ownership
(other than the seller-lessee's
occupancy rights) after the date of
such transaction, and
``(III) pays a purchase price for
the property that is not less than the
fair market price of such property
encumbered by a leaseback, and taking
into account the terms of the lease.
``(C) Additional definitions.--For purposes of
subparagraph (B)--
``(i) Occupancy rights.--The term
`occupancy rights' means the right to occupy
the property for any period of time, including
a period of time measured by the life of the
seller-lessee on the date of the sale-leaseback
transaction (or the life of the surviving
seller-lessee, in the case of jointly held
occupancy rights), or a periodic term subject
to a continuing right of renewal by the seller-
lessee (or by the surviving seller-lessee, in
the case of jointly held occupancy rights).
``(ii) Fair rental.--The term `fair rental'
means a rental for any subsequent year which
equals or exceeds the rental for the 1st year
of a sale-leaseback transaction.''.
(b) Effective Date.--The amendment made by this section shall apply
to sales after December 31, 1999, in taxable years beginning after such
date.
TITLE IX--NATIONAL FUND FOR HEALTH RESEARCH
SEC. 901. ESTABLISHMENT OF FUND.
(a) Establishment.--There is established in the Treasury of the
United States a fund, to be known as the ``National Fund for Health
Research'' (in this section referred to as the ``Fund''), consisting of
such amounts as are transferred to the Fund under subsection (b) and
any interest earned on investment of amounts in the Fund.
(b) Transfers to Fund.--
(1) In general.--The Secretary of the Treasury shall
transfer to the Fund amounts equivalent to amounts designated
under paragraph (2) and received in the Treasury.
(2) Amounts.--
(A) Health plan set aside.--With respect to each
calendar year beginning with the first full calendar
year after the date of enactment of this Act, each
health plan shall set aside and transfer to the
Treasury of the United States an amount equal to--
(i) for the first full calendar year, 0.25
percent of all health premiums received with
respect to the plan for such year;
(ii) for the second full calendar year, 0.5
percent of all health premiums received with
respect to the plan for such year;
(iii) for the third full calendar year,
0.75 percent of all health premiums received
with respect to the plan for such year; and
(iv) for the fourth and each succeeding
full calendar year, 1 percent of all health
premiums received with respect to the plan for
such year.
(3) Transfers based on estimates.--The amounts transferred
by paragraph (1) shall annually be transferred to the Fund
within 30 days after the President signs an appropriations Act
for the Departments of Labor, Health and Human Services, and
Education, and related agencies, or by the end of the first
quarter of the fiscal year. Proper adjustment shall be made in
amounts subsequently transferred to the extent prior estimates
were in excess of or less than the amounts required to be
transferred.
(4) Definition.--As used in this subsection, the term
``health plan'' means a group health plan (as defined in
section 2791(a) of the Public Health Service Act and any
individual health insurance (as defined in section 2791(b)(5)
of such Act) operated by a health insurance issuer.
(c) Obligations From Fund.--
(1) In general.--Subject to the provisions of paragraph
(4), with respect to the amounts made available in the Fund in
a fiscal year, the Secretary of Health and Human Services shall
distribute--
(A) 2 percent of such amounts during any fiscal
year to the Office of the Director of the National
Institutes of Health to be allocated at the Director's
discretion for the following activities:
(i) for carrying out the responsibilities
of the Office of the Director, including the
Office of Research on Women's Health and the
Office of Research on Minority Health, the
Office of Alternative Medicine, the Office of
Rare Disease Research, the Office of Behavioral
and Social Sciences Research (for use for efforts to reduce tobacco
use), the Office of Dietary Supplements, and the Office for Disease
Prevention; and
(ii) for construction and acquisition of
equipment for or facilities of or used by the
National Institutes of Health;
(B) 2 percent of such amounts for transfer to the
National Center for Research Resources to carry out
section 1502 of the National Institutes of Health
Revitalization Act of 1993 concerning Biomedical and
Behavioral Research Facilities;
(C) 1 percent of such amounts during any fiscal
year for carrying out section 301 and part D of title
IV of the Public Health Service Act with respect to
health information communications; and
(D) the remainder of such amounts during any fiscal
year to member institutes and centers, including the
Office of AIDS Research, of the National Institutes of
Health in the same proportion to the total amount
received under this section, as the amount of annual
appropriations under appropriations Acts for each
member institute and Centers for the fiscal year bears
to the total amount of appropriations under
appropriations Acts for all member institutes and
Centers of the National Institutes of Health for the
fiscal year.
(2) Plans of allocation.--The amounts transferred under
paragraph (1)(D) shall be allocated by the Director of the
National Institutes of Health or the various directors of the
institutes and centers, as the case may be, pursuant to
allocation plans developed by the various advisory councils to
such directors, after consultation with such directors.
(3) Grants and contracts fully funded in first year.--With
respect to any grant or contract funded by amounts distributed
under paragraph (1), the full amount of the total obligation of
such grant or contract shall be funded in the first year of
such grant or contract, and shall remain available until
expended.
(4) Trigger and release of monies and phase-in.--
(A) Trigger and release.--No expenditure shall be
made under paragraph (1) during any fiscal year in
which the annual amount appropriated for the National
Institutes of Health is less than the amount so
appropriated for the prior fiscal year.
(B) Phase-in.--The Secretary of Health and Human
Services shall phase-in the distributions required
under paragraph (1) so that--
(i) 25 percent of the amount in the Fund is
distributed in the first fiscal year for which
funds are available;
(ii) 50 percent of the amount in the Fund
is distributed in the second fiscal year for
which funds are available;
(iii) 75 percent of the amount in the Fund
is distributed in the third fiscal year for
which funds are available; and
(iv) 100 percent of the amount in the Fund
is distributed in the fourth and each
succeeding fiscal year for which funds are
available.
(d) Budget Treatment of Amounts in Fund.--The amounts in the Fund
shall be excluded from, and shall not be taken into account, for
purposes of any budget enforcement procedure under the Congressional
Budget Act of 1974 or the Balanced Budget and Emergency Deficit Control
Act of 1985.
<all>
Introduced in Senate
Sponsor introductory remarks on measure. (CR S311, SS406-413)
Read twice and referred to the Committee on Finance.
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