-
https://clinton.presidentiallibraries.us/files/original/2a24da981d3e292ce3b73913a1395420.pdf
49451281a2151e5197950281bd10629a
PDF Text
Text
FOIA Number:
2006-0885-F
FOIA
MARKER
This is not a textual record. This is used as an
administrative marker by the William J. Clinton
Presidential Library Staff.
Collection/Record Group:
Clinton Presidential Records
Subgroup/Office of Origin:
Health Care Task Force
Series/Staff Member:
Heenan
Subseries:
3533
OA/ID Number:
FolderlD:
Folder Title:
[S. 1807 - Gramm Health Care] [loose]
Stack:
Row:
Section:
Shelf:
Position:
S
53
1
2
2
�Calendar No. 370
103D CONGRESS
2D SESSION
S. 1807
To guarantee individuals and families continued choice and control over their
doctors, hospitals, and health care services, to secure access to quality
health care for all, to ensure that health coverage is portable and renewable, to control medical cost inflation through market incentives and
tax reform, to reform medical malpractice litigation, and for other purposes.
I N T H E SENATE OP THE UNITED STATES
JANUARY 27 (legislative day, JANUARY 25), 1994
Mr. GRAMM (for himself, Mr. MCCAIN , Mr. COATS, Mr. BROWN, Mr.
COVERDELL, Mrs. HUTCHISON, Mr. BENNETT, Mr. HELMS, Mr. LOTT,
1
Mr. FAIRCLOTH, and Mr. WALLOP) introduced the following bill; which
was read the first time
FEBRUARY 22, 1994
Read the second time and placed on the calendar
A BILL
To guarantee individuals and families continued choice and
control over their doctors, hospitals, and health care services, to secure access to quality health care for all, to
ensure that health coverage is portable and renewable,
to control medical cost inflation through market incentives and tax reform, to reform medical malpractice litigation, and for other purposes.
�2
1
Be it enacted by the Senate and House of Representa-
2 tives of the United States of America in Congress assembled,
3
SECTION 1. SHORT T I T L E ; TABLE OF CONTENTS; DEFEMI-
4
TIONS.
5
(a) SHORT TITLE.—This Act may be cited as the
6 "Comprehensive Family Health Access and Savings Act".
7
(b) TABLE OF CONTENTS.—The table of contents for
8 this Act is as follows:
Sec. 1. Short title; definitions; table of contents.
TITLE I—PORTABLE AND PERMANENT PRIVATE HEALTH
INSURANCE
Subtitle A—Portability
Sec. 101. Amendments to COBRA.
Sec. 102. Penalty-free withdrawals from qualified retirement plans for COBRA
coverage.
Subtitle B—Permanence
Sec.
Sec.
Sec.
Sec.
111.
112.
113.
114.
General renewability requirements.
Individual health insurance plans.
Group health plans.
Failure of health plans to meet portability and permanence requirements.
TITLE II—EXPANSION OF HEALTH CARE CHOICES
Subtitle A—Employer-Provided Health Insurance
Sec. 201. Tax treatment of employer-provided health insurance.
Subtitle B—Medical Savings Accounts
Sec. 211. Individuals allowed deduction from gross income for cost of catastrophic health insurance plan.
Sec. 212. Medical savings accounts.
TITLE III—EQUAL TAX TREATMENT FOR HEALTH INSURANCE
OF SELF-EMPLOYED AND UNINSURED
See. 301. Equal exclusion from gross income of health insurance coverage costs.
TITLE IV—SMALL BUSINESS HEALTH INSURANCE POOLS
Sec. 401. Prohibition of restrictions on groups purchasing health insurance.
Sec. 402. Prohibition of State benefit mandates for group health plans.
Sec. 403. Prohibition of restrictions on managed care.
•S 1807 PCS
�T I T L E V—ASSISTANCE TO I N D I V I D U A L S W I T H PREEXISTING
CONDITIONS I N PURCHASING H E A L T H INSURANCE
Sec. 501. Preexisting condition insurance pool allotment program.
T I T L E VI—ENCOURAGE RESPONSIBLE BEHAVIOR BY T H E
FINANCIALLY CAPABLE
Sec. 601. One year window to purchase health insurance coverage.
Sec. 602. Prohibition of restrictions relating to the use of collection procedures.
T I T L E VH—ASSISTANCE TO LOW-INCOME WORKERS TO
PURCHASE H E A L T H INSURANCE
Sec. 701. Refundable catastrophic health insurance plan credit.
T I T L E V I I I—REWARD PREVENTIVE MEDICINE A N D H E A L T H Y
LIFESTYLES
Sec. 801. Reward preventive medicine and healthy lifestyles.
T I T L E IX—REFORM MEDICAID AND EXPAND CHOICES UNDER
MEDICARE
Subtitle A—Medicaid
Sec. 901. Cap on Federal payments made for medical assistance under the
medicaid program.
Sec. 902. Waivers for furnishing medical assistance under the medicaid program.
Subtitle B—Medicare
Sec. 951. Individual election for type of coverage.
Sec. 952. Health care coverage under a private health care arrangement.
T I T L E X—ENHANCED EFFICIENCY THROUGH PAPERWORK
REDUCTION
Sec. 1001. Federal papenvork reduction and efficiency requirements.
Sec. 1002. State papenvork reduction and efficiency requirements.
Sec. 1003. Standardized Forms Commission.
T I T L E X I — M E A N I N G F U L MEDICAL L I A B I L I T Y REFORM
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
1101.
1102.
1103.
1104.
1105.
1106.
1107.
1108.
1109.
1110.
1111.
1112.
1113.
1114.
Applicability and preemption.
Statute of limitations.
Scope of liability.
Discovery; failure to make or cooperate in discovery.
Limitation on noneconomic damages.
Treatment of payments for future economic losses.
Treatment of costs and attorney's fees.
Contribution and indemnification.
Collateral sources.
Damages relating to medical product liability claims.
Class actions.
Definitions.
Severability.
Effective date.
•S 1807 PCS
�4
TITLE XII—ANTITRUST REFORMS
Sec. 1201. Establishment of limited exemption program for health care joint
ventures.
Sec. 1202. Issuance of health care certificates of public advantage.
Sec. 1203. Interagency Advisory Committee on Competition, Antitrust Policy,
and Health Care.
Sec. 1204. Definitions.
TITLE XIII—EXPENDITURE TARGETS FOR THE MEDICAID AND
MEDICARE PROGRAMS
Sec. 1301. Determination of expenditures under the medicaid and medicare
programs.
Sec. 1302. Delay of health insurance benefits due to excess expenditures.
1
(c) DEFINITIONS.—For purposes of this Act:
2
(1) EMPLOYER.—The term "employer" shall
3
have the meaning applicable under section 3(5) of
4
the Employee Retirement Income Security Act of
5
1974.
6
(2) GROUP HEALTH PLAN.—The term "group
7
health plan" has the meaning given such term by
8
section 5000(b)(1) of the Internal Revenue Code of
9
1986, but does not include any type of coverage ex-
10
eluded from the definition of a health insurance plan
11
under paragraph (2).
12
(3) HEALTH INSURANCE PLAN.—
13
(A) I N GENERAL.—Except as provided in
14
subparagraph (B), the term "health insurance
15
plan" means any hospital or medical service
16
policy or certificate, hospital or medical service
17
plan contract, or health maintenance organiza-
18
tion group contract offered by an insurer.
•S 1807 PCS
�5
1
2
(B) EXCEPTION.—Such term does not inelude any of the following—
3
(i) coverage only for accident, dental,
4
vision, disability income, or long-term care
5
insurance, or any combination thereof,
6
(ii) medicare supplemental health in-
7
surance,
8
(iii) coverage issued as a supplement
9
to liability insurance,
10
(iv) worker's compensation or similar
11
insurance, or
12
(v) automobile medical-payment insur-
13
ance,
14
or any combination thereof.
15
(4)
HEALTH
MAINTENANCE
ORGANIZATION.—
16
The term "health maintenance organization" in-
17
eludes a health insurance plan that offers to provide
18
health services on a prepaid, at-risk basis primarily
19
through a defined set of providers.
20
(5) INSURER.—The term "insurer" means a li-
21
censed insurance company, a prepaid hospital or
22
medical service plan, or a health maintenance orga-
23
nization offering such a plan to an employer, and in-
24
eludes a similar organization regulated under State
25
law for solvency.
•S 1807 PCS
�6
1
2
(6) SECRETARY.—The term "Secretary" means
the Secretary of Health and Human Services.
3
(7) STATE.—The term "State" means each of
4
the several States of the United States, the District
5
of Columbia, the Commonwealth of Puerto Rico, the
6
United States Virgin Islands, Guam, American
7
Samoa, and the Commonwealth of the Northern
8
Mariana Islands.
9 T I T L E I—PORTABLE AND PER1
0
MANENT PRIVATE HEALTH
n
INSURANCE
1
2
Subtitle A—Portability
13 SEC. 101. AMENDMENTS TO COBRA.
14
(a) LOWER COST COVERAGE OPTIONS.—Subpara-
15 graph (A) of section 4980B(f)(2) of the Internal Revenue
16 Code of 1986 (relating to continuation coverage require17 ments of group health plans) is amended to read as
18 follows:
19
"(A) TYPE OF BENEFIT COVERAGE.—The
20
coverage must consist of coverage which, as of
21
the time the coverage is being provided—
22
"(i) is identical to the coverage pro-
23
vided under the plan to similarly situated
24
beneficiaries under the plan with respect to
25
whom a qualifying event has not occurred,
•S 1807 PCS
�7
1
"(ii) is so identical, except such cov-
2
erage is offered with an annual $1,000 de-
3
ductible, and
4
"(iii) is so identical, except such cov-
5
erage is offered with an annual $3,000 de-
6
ductible.
7
I f coverage under the plan is modified for any
8
group of similarly situated beneficiaries, the
9
coverage shall also be modified in the same
10
manner for all individuals who are qualified
11
beneficiaries under the plan pursuant to this
12
subsection in connection with such group."
13
14
(b)
TERMINATION OP
ELIGIBLE
COBRA
FOR EMPLOYER-BASED
COVERAGE
COVERAGE
AFTER
FOR
90
15 DAYS.—Clause (iv) of section 4980B(f)(2)(B) of the In16 ternal Revenue Code of 1986 (relating to period of cov17 erage) is amended—
18
(1) by striking "or" at the end of subclause (I),
19
(2) by redesignating subclause (II) as subclause
20
21
22
(III), and
(3) by inserting after subclause (I) the following new subclause:
23
" ( I I ) eligible for such employer-
24
based coverage for more than 90 days,
25
or".
•S 1807 PCS
�8
1
(c) EFFECTIVE DATE.—The amendments made by
2 this section shall apply to qualifying events occurring after
3 the date of the enactment of this Act.
4
SEC. 102. PENALTY-FREE WITHDRAWALS FROM QUALIFIED
5
RETIREMENT PLANS FOR COBRA COVERAGE.
6
(a) I N GENERAL.—Subparagraph (A) of section
7 72(t)(2) of the Internal Revenue Code of .1986 (relating
8 to additional tax not to apply to certain distributions) is
9 amended—
10
11
12
13
14
15
(1) by striking "or" at the end of clauses (iv)
and (v),
(2) by striking the period at the end of clause
(vi) and inserting ", or", and
(3) by adding at the end the following new
clause:
16
"(vii) made to an employee who is a
17
qualified beneficiary during the period of
18
continuation
19
4980B(f)."
20
coverage
under
section
(b) EFFECTIVE DATE.—The amendments made by
21 subsection (a) shall apply to distributions made after the
22 date of the enactment of this Act.
23
24
25
Subtitle B—Permanence
SEC. 111. GENERAL RENEWABILITY REQUIREMENTS.
(a) INSURERS.—
•S 1807 PCS
�9
1
(1) I N GENERAL.—An insurer may not cancel
2
an individual health insurance plan or group health
3
plan or deny renewal of coverage under such a plan
4
other than—
5
(A) for nonpayment of premiums,
6
(B) for fraud or other misrepresentation
7
by the insured,
8
9
(C) for noncompliance with plan provisions, or
10
(D) because the insurer is ceasing to pro-
11
vide any health insurance plan in a State, or,
12
in the case of a health maintenance organiza-
13
tion, in a geographic area.
14
(2) L I M I T A T I O N ON MARKET REENTRY.—If an
15
insurer terminates the offering of health insurance
16
plans or group health plans in an area, the insurer
17
may not offer such a plan in the area until 5 years
18
after the date of the termination.
19
(b) EMPLOYERS.—An employer may not cancel a
20 self-insured group health plan or deny renewal of coverage
21
under such a plan other than—
22
(1) for nonpayment of premiums,
23
(2) for fraud or other misrepresentation by the
24
25
insured,
(3) for noncompliance with plan provisions, or
•S 1807 PCS
�10
1
(4) because the plan is ceasing to provide any
2
coverage in a geographic area.
3
(c) EFFECTIVE DATE.—The provisions of this section
4 shall apply to any plan on or after the date of the enact5 ment of this Act.
6 SEC 112. INDIVIDUAL HEALTH INSURANCE PLANS.
7
(a) EXISTING PLANS.—With respect to any individ-
8 ual health insurance plan in effect on the date of the en9 actment of this Act, the insurer shall offer the insured
10 the option to purchase a new individual health insurance
11 described in subsection (b).
12
(b) NEW PLANS.—With respect to any individual
13 health insurance plan, the effective date of which with re14 spect to the insured occurs after the date of the enactment
15 of this Act, the insurer may not increase the premium for
16 such a plan based on the health of the insured.
17 SEC. 113. GROUP HEALTH PLANS.
18
(a) EXISTING PLANS.—With respect to any group
19 health plan (other than a self-insured group health plan)
20 in effect on the date of the enactment of this Act, the
21 insurer shall offer—
22
(1) any insured of such plan the option to pur-
23
chase upon leaving the group a new individual health
24
insurance plan, the premium of which shall be rated
25
based on actuarial data, may be based on any pre-
•S 1807 PCS
�11
1
existing condition of the insured, and may be in-
2
creased based on the health of such insured, and
3
(2) the employer or group sponsor of such plan
4
the option to purchase a new group health plan de-
5
scribed in subsection (b).
6
(b) NEW PLANS.—With respect to any group health
7 plan (other than a self-insured group health plan), the ef8 fective date of which with respect to the employer or group
9 sponsor occurs after the date of the enactment of this Act,
10 the insurer—
11
(1) may not increase the premium for such a
12
plan based on the health of the group's insured, and
13
(2) shall offer any insured of such plan the op-
14
tion to purchase upon leaving the group a new indi-
15
vidual health insurance plan, the premium of which
16
shall be rated based on actuarial data, may not be
17
based on any preexisting condition of the insured,
18
and may not be increased based on the health of
19
such insured.
20
(c) SELF-INSURED GROUP HEALTH PLANS.—With
21 respect to a self-insured group health plan—
22
23
(1) in effect on the date of the enactment of
this A c t -
's 1807 PCS
�12
1
(A) subsection (a)(1) shall apply through 1
2
or more insurers contracted with by such plan,
3
and
4
(B) subsection (a)(2) shall not apply, and
5
(2) the effective date of which with respect to
6
the employer or group sponsor occurs after the date
7
of the enactment of this Act, subsection (b) shall
8
apply through 1 or more insurers contracted with by
9
such plan.
10 SEC. 114. FAILURE OF HEALTH PLANS TO MEET PORT11
ABILITY AND PERMANENCE REQUIREMENTS.
12
(a) DEDUCTION FOR INDIVIDUAL HEALTH INSUR-
13 ANCE PLANS.—Paragraph (1) of section 213(d) of the In14 ternal Revenue Code of 1986 (defining medical care) is
15 amended—
16
17
18
19
(1) by striking "or" at the end of subparagraph
(B), and
(2) by striking subparagraph (C) and inserting
the following new subparagraphs:
20
"(C) for insurance—
21
"(i) meeting the requirements of sec-
22
tion 112 of the Comprehensive Family
23
Health Access and Savings Act, and
24
"(ii) covering medical care referred to
25
in subparagraphs (A) and (B), or
•S 1807 PCS
�13
1
"(D) as premiums under part B of title
2
XVIII of the Social Security Act, relating to
3
supplementary medical insurance for the aged.
4
(b)
TAX EXCLUSIONS FOR EMPLOYER-PROVIDED
5 HEALTH INSURANCE.—Section 106 of the Internal Reve6 nue Code of 1986 (relating to contributions by employer
7 to accident and health plans) is amended by striking "an
8 accident or health plan" and inserting "an accident or
9 health plan meeting the requirements of section 113 of
10 the Comprehensive Family Health Access and Savings
11 Act".
12
(c) BUSINESS EXPENSE DEDUCTION FOR HEALTH
13 INSURANCE.—Section 162 of the Internal Revenue Code
14 of 1986 (relating to trade or business expenses) is amend15 ed by redesignating subsection (o) as subsection (p) and
16 by inserting after subsection (n) the following new sub17 section:
18
"(o) GROUP HEALTH PLANS.—The expenses paid or
19 incurred by an employer for a group health plan shall not
20 be allowed as a deduction under this section unless such
21 plan meets the requirements of section 113 of the Com22 prehensive Family Health Access and Savings Act."
23
24
(d) PAYROLL TAX EXCLUSION FOR EMPLOYER-PRO-
VIDED HEALTH INSURANCE.—Section
209(a)(2) of the
25 Social Security Act (42 U.S.C. 409(a)(2)) is amended by
•8 1807 PCS
�14
1 inserting "or group health insurance" after "group-term
2 life insurance".
3
(e) EFFECTIVE DATE.—The amendments made by
4 this section shall take effect on the date of the enactment
5 of this Act.
6
7
8
9
T I T L E II—EXPANSION OF
HEALTH CARE CHOICES
Subtitle A—Employer-Provided
Health Insurance
10 SEC
201. TAX TREATMENT OF EMPLOYER-PROVIDED
11
12
HEALTH INSURANCE.
(a)
TAX EXCLUSIONS FOR EMPLOYER-PROVIDED
13 HEALTH INSURANCE.—Section 106 of the Internal Reve14 nue Code of 1986 (relating to contributions by employer
15 to accident and health plans), as amended by section
16 115(b), is amended by striking "an accident or health plan
17 meeting the requirements of section 113 of the Com18 prehensive Family Health Access and Savings Act" and
19 inserting "a qualified health insurance package (as de20 fined in section 162(o)(2)), which meets the requirements
21 of section 113 of the Comprehensive Family Health Access
22 and Savings Act, to the extent the employer contribution
23 does not exceed the actual cost of such coverage".
24
(b) BUSINESS EXPENSE DEDUCTION FOR HEALTH
25 INSURANCE.—Subsection (o) of section 162 of the Interns 1 0 P S
87 C
�15
1 nal Revenue Code of 1986 (relating to trade or business
2 expenses), as added by section 115(c), is amended to read
3 as follows:
4
"(o) GROUP HEALTH PLANS.—
5
"(1) I N GENERAL.—The expenses paid or in-
6
curred by an employer for a group health plan shall
7
not be allowed as a deduction under this section
8
unless—
9
"(A) such plan meets the requirements of
10
section 113 of the Comprehensive Family
11
Health Access and Savings Act,
12
13
"(B) such plan is offered through a qualified health insurance package, and
14
15
"(C) such employer's contribution per
employee—
16
"(i) for coverage described in subpara-
17
graph (B) or (C) of paragraph (2) is not
18
less than such contribution for coverage
19
described in paragraph (2)(A) (determined
20
either on an average cost or actual cost
21
basis as elected by the employer), and
22
"(ii) for coverage described in para-
23
graph (2)(C) does not exceed such con-
24
tribution for coverage described in sub-
•S 1807 PCS
�16
1
paragraph (A) or (B) of paragraph (2),
2
whichever is higher (as so determined).
3
"(2)
QUALIFIED
HEALTH
INSURANCE
PACK-
4
AGE.—For purposes of paragraph (1), the term
5
'qualified health insurance package' means an an-
6
nual option provided to each employee of the em-
7
ployer during a 2-month election period to select 1
8
of the following health insurance coverages for the
9
following calendar year:
10
"(A) The health insurance coverage pro-
11
vided by the employer on the date of the enact-
12
ment of the Comprehensive Family Health Ac-
13
cess and Savings Act.
14
"(B) Coverage in a health maintenance or-
15
ganization, managed care arrangement, or pre-
16
ferred provider organization.
17
"(C) Medical savings account under section
18
19
220."
(c)
EFFECTIVE DATE.—The
amendments made by
20 this section shall apply with respect to any taxable year
21 beginning after the date of the enactment of this Act.
•S 1807 PCS
�17
1
2
Subtitle B—Medical Savings
Accounts
3 SEC. 211. INDIVIDUALS ALLOWED DEDUCTION FROM
4
GROSS INCOME FOR COST OF CATASTROPHIC
5
HEALTH INSURANCE PLAN.
6
(a) I N GENERAL.—Subsection (a) of section 62 of the
7 Internal Revenue Code of 1986 (defining adjusted gross
8 income) is amended—
9
10
11
12
(1) by striking the flush sentence immediately
following paragraph (14), and
(2) by inserting after paragraph (15) the following:
13
"(16)
MEDICAL EXPENSES ATTRIBUTABLE TO
14
CATASTROPHIC
15
ERAGE.—
HEALTH
INSURANCE
PLAN COV-
16
"(A) I N GENERAL.—The deduction allowed
17
by section 213 to the extent attributable to cov-
18
erage under a catastrophic health insurance
19
plan (as defined in section 220(c)(2)).
20
"(B)
EXCEPTION.—Subparagraph
(A)
21
shall not apply to coverage of an individual who
22
has coverage described in section 220(c)(1)(B).
23 Nothing in this section shall permit the same item to be
24 deducted more than once."
S 1807 PCS-
�18
1
(b) COORDINATION W I T H DEDUCTION FOR OTHER
2 MEDICAL EXPENSES.—Subsection (a) of section 213 of
3 the Internal Revenue Code of 1986 (relating to medical,
4 dental, etc., expenses) is amended to read as follows:
5
"(a) ALLOWANCE OF DEDUCTION.—There shall be
6 allowed as a deduction the expenses paid during the tax7 able year, not compensated by insurance or otherwise, for
8 medical care of the taxpayer, his spouse, or a dependent
9 (as defined in section 152) in an amount equal to the sum
10 of—
11
"(1) the portion of such expenses attributable
12
to coverage under a catastrophic health insurance
13
plan (as defined in section 220(c)(2)), and
14
"(2) the excess of such expenses (other than ex-
15
penses described in paragraph (1)) over 7.5 percent
16
of the adjusted gross income of the taxpayer."
17
(c) EFFECTIVE DATE.—The amendments made by
18 this section shall apply to taxable years beginning after
19 the date of the enactment of this Act.
20 SEC 212. MEDICAL SAVINGS ACCOUNTS.
21
(a) I N GENERAL.—Part VII of subchapter B of chap-
22 ter 1 of the Internal Revenue Code of 1986 (relating to
23 additional itemized deductions for individuals) is amended
24 by redesignating section 220 as section 221 and by insert25 ing after section 219 the following new section:
•S 1807 PCS
�19
1 "SEC. 220. MEDICAL SAVINGS ACCOUNTS.
2
"(a) DEDUCTION ALLOWED.—In the case of an eligi-
3 ble individual, there shall be allowed as a deduction the
4 amounts paid in cash during the taxable year by or on
5 behalf of such individual to a medical savings account for
6 the benefit of such individual and (if any) such individual's
7 spouse and dependents if such spouse and dependents are
8 eligible individuals.
9
"(b) LIMITATIONS.—
10
"(1) ONLY I ACCOUNT PER FAMILY.—Except as
11
provided in regulations prescribed by this Secretary,
12
no deduction shall be allowed under subsection (a)
13
for amounts paid to any medical savings account for
14
the benefit of an individual, such individual's spouse,
15
or any dependent of such individual or spouse if
16
such individual, spouse, or dependent is a beneficiary
17
of any other medical savings account.
18
"(2) DOLLAR LIMITATION.—The amount allow-
19
able as a deduction under subsection (a) for the tax-
20
able year shall not exceed $3,000, or such higher
21
amounts as may be specified in subparagraph
22
(c)(2)(C).
23
"(c) DEFINITIONS.—For purposes of this section:
24
" ( l ) ELIGIBLE INDIVIDUAL.—
25
"(A) I N GENERAL.—The term 'eligible in-
26
dividual' means any individual who is covered
•S 1807 PCS
�20
1
under a catastrophic health insurance plan
2
throughout the calendar year in which or with
3
which the taxable year ends.
4
"(B) LIMITATIONS.—Such term does not
5
include an individual who is 65 years of age or
6
older, unless the individual is covered under a
7
catastrophic health insurance plan that is a pri-
8
mary plan (within the meaning of section
9
1862(b)(2)(A) of the Social Security Act).
10
"(2)
11
PLAN.—
12
CATASTROPHIC
HEALTH
"(A) I N GENERAL.—The
INSURANCE
term
'cata-
13
strophic health insurance plan' means a health
14
plan covering specified expenses incurred by an
15
individual for medical care (as defined in sub-
16
paragraph (B)) for such individual and the
17
spouse and dependents (as defined in section
18
152) of such individual only to the extent such
19
expenses covered by the plan for any calendar
20
year exceed $3,000 or such higher amounts as
21
may be specified by the plan.
22
23
"(B) MEDICAL CARE.—The term 'medical
care' means—
24
"(i) medical care as defined in section
25
213(d) (without regard to non-emergency
•S 1807 PCS
�21
1
transportation under paragraph (1)(B) and
2
amounts described in paragraph (2)), and
3
"(ii) services and care not less than
4
such services and care identified (but not
5
in the manner prescribed) in paragraphs
6
(1), (2), (3), (4)(A), (4)(B), (5), (17), and
7
(21) of section 1905(a).
8
"(C)
COST-OP-LIVING
ADJUSTMENT.—In
9
the case of any calendar year after 1995, the
10
dollar amount in subparagraph (A) and para-
11
graph (b)(2) shall be increased by an amount
12
equal to—
13
"(i) such dollar amount, multiplied by
14
"(ii) the cost-of-living adjustment de-
15
termined under section 1(f)(3) for such
16
calendar year.
17
I f any increase under the preceding sentence is
18
not a multiple of $50, such increase shall be
19
rounded to the nearest multiple of $50.
20
"(d) MEDICAL
SAVINGS ACCOUNT.—For
purposes of
21 this section:
22
"(1) MEDICAL SAVINGS ACCOUNT D E F I N E D . —
23
"(A) I N GENERAL.—The term 'medical
24
savings account' means a trust created or orga-
25
nized in the United States exclusively for the
•S 1807 PCS
�22
1
purpose of paying the medical expenses of the
2
beneficiaries of such trust, but only if the writ-
3
ten governing instrument creating the trust
4
meets the following requirements:
5
"(i) Except in the case of a rollover
6
contribution described in subsection (e)(5),
7
no contribution will be accepted unless it is
8
in cash, and contributions will not be ac-
9
cepted in excess of the amount allowed as
10
a deduction under this section for the tax-
11
able year.
12
"(ii) The trustee is a bank (as defined
13
in section 408(n)) or another person who
14
demonstrates to the satisfaction of the Sec-
15
retary that the manner in which such per-
16
son will administer the trust will be con-
17
sistent with the requirements
18
section.
19
of this
"(iii) No part of the trust assets will
20
be invested in life insurance contracts.
21
"(iv) The assets of the trust will not
22
be commingled with other property except
23
in a common trust fund or common invest-
24
ment. fund.
•S 1807 PCS
�23
1
"(v) The interest of an individual in
2
the balance in his account is nonforfeit-
3
able.
4
"(vi) Under regulations prescribed by
5
the Secretary, rules similar to the rules of
6
section 401(a)(9) shall apply to the dis-
7
tribution of the entire interest of bene-
8
ficiaries
9
"(B)
of such trust.
TREATMENT OP COMPARABLE AC-
10
COUNTS HELD BY INSURANCE COMPANIES.—
11
For purposes of this section, an account held by
12
an insurance company in the United States
13
shall be treated as a medical savings account
14
(and such company shall be treated as a bank)
15
if—
16
"(i) such account is part of a health
17
insurance plan that includes a catastrophic
18
health insurance plan (as defined in sub-
19
section (c)(2)),
20
"(ii) such account is exclusively for
21
the purpose of paying the medical expenses
22
of the beneficiaries of such account who
23
are covered under such catastrophic health
24
insurance plan, and
•S 1807 PCS
�24
1
"(iii) the written instrument govern-
2
ing the account meets the requirements of
3
clauses (i), (v), and (vi) of subparagraph
4
(A).
5
"(2) MEDICAL EXPENSES.—
6
"(A) I N GENERAL.—The term 'medical ex-
7
penses' means, with respect to an individual,
8
amounts paid or incurred by such individual for
9
medical care for such individual, the spouse of
10
such individual, and any dependent (as defined
11
in section 152) of such individual, but only to
12
the extent such amounts—
13
"(i) are not compensated for by insur-
14
ance or otherwise, and
15
"(ii) are counted towards a deductible
16
under the terms of such individual's cata-
17
strophic health insurance plan.
18
"(B) HEALTH PLAN COVERAGE MAY NOT
19
BE PURCHASED FROM ACCOUNT.—Such term
20
shall not include any amount paid for coverage
21
under a health plan.
22
"(3)
TIME
WHEN
CONTRIBUTIONS DEEMED
23
MADE.—A contribution shall be deemed to be made
24
on the last day of the preceding taxable year if the
25
contribution is made on account of such taxable year
•8 1807 PCS
�25
1
and is made not later than the time prescribed by
2
law for filing the return for such taxable year (not
3
including extensions thereof).
4
"(e) TAX TREATMENT OF DISTRIBUTIONS.—
5
"(1) I N GENERAL.—Except as provided in para-
6
graphs (2), (3), and (5), any amount paid or distrib-
7
uted out of a medical savings account shall be in-
8
eluded in the gross income of the individual for
9
whose benefit such account was established.
10
11
"(2)
EXCEPTION FOR MEDICAL AND LONG
TERM CARE EXPENSES.—
12
"(A) I N GENERAL.—Paragraph (1) shall
13
not apply if such amount paid or distributed is
14
used exclusively to pay—
15
"(i) the medical expenses of such indi-
16
vidual, or
17
"(ii) except as provided in subpara-
18
graph (B), the expenses for long term care
19
services of the type identified in section
20
1931(e)(3) of the Social Security Act for
21
the individual.
22
"(B)
NONQUALIFIED PAYMENTS OR DIS-
23
TRIBUTIONS FOR LONG TERM
24
Paragraph (1) shall apply to any portion of a
25
payment or distribution for expenses for long
•S 1807 PCS
EXPENSES.—
�26
1
term care services equal to the amount by
2
which, after such payment or distribution—
3
"(i) the amount of the deductible
4
under the catastrophic health insurance
5
plan covering the individual, exceeds
6
"(ii) the aggregate balance of all med-
7
ical savings accounts established for the
8
benefit of the individual.
9
For purposes of this paragraph, any payment or dis-
10
tribution for medical expenses shall be considered to
11
have been made before any other payment or dis-
12
tribution.
13
"(3)
EXCESS CONTRIBUTIONS RETURNED BE-
14
PORE DUE DATE OP RETURN.—Paragraph (1) shall
15
not apply to the distribution of any contribution paid
16
during a taxable year to a medical savings account
17
to the extent that such contribution exceeds the
18
amount allowable as a deduction under subsection
19
(a) i f —
20
"(A) such distribution is received by the
21
individual on or before the last day prescribed
22
by law (including extensions of time) for filing
23
such individual's return for such taxable year,
24
and
•S 1807 PCS
�27
1
"(B) such distribution is accompanied by
2
the amount of net income attributable to such
3
excess contribution.
4
Any net income described in subparagraph (B) shall
5
be included in the gross income of the individual for
6
the taxable year in which it is received.
7
"(4) PENALTY FOR DISTRIBUTIONS NOT USED
8
FOR MEDICAL EXPENSES WHICH LEAVE AN AMOUNT
9
LESS THAN THE CATASTROPHIC DEDUCTIBLE I N
10
THE ACCOUNT.—
11
"(A) I N GENERAL.—The tax imposed by
12
this chapter for any taxable year in which there
13
is a payment or distribution from a medical
14
savings account which is includible in gross in-
15
come under paragraph (1) shall be increased by
16
10 percent with respect to the penalty portion
17
of such payment or distribution.
18
"(B)
PENALTY PORTION.—For
purposes of
19
subparagraph (A), the penalty portion of any
20
payment or distribution is equal to the amount
21
by which, after such payment or distribution—
22
"(i) the amount of the deductible
23
under the catastrophic health insurance
24
plan covering the individual, exceeds
.3 1807 PCS
�28
1
"(ii) the aggregate balance of all med-
2
ical savings accounts established for the
3
benefit of the individual.
4
For purposes of this paragraph, any payment or dis-
5
tribution for medical expenses shall be considered to
6
have been made before any other payment or dis-
7
tribution.
8
"(5) ROLLOVERS.—Paragraph (1) shall not
9
apply to any amount paid or distributed out of a
10
medical savings account to the individual for whose
11
benefit the account is maintained if the entire
12
amount received (including money and any other
13
property) is paid into another medical savings ac-
14
count for the benefit of such individual not later
15
than the 60th day after the day on which he received
16
the payment or distribution.
17
"(f) TAX TREATMENT OP ACCOUNTS.—
18
"(1) EXEMPTION PROM TAX.—Any medical sav-
19
ings account is exempt from taxation under this sub-
20
title unless such account has ceased to be a medical
21
savings account by reason of paragraph (2) or (3).
22
Notwithstanding the preceding sentence, any such
23
account shall be subject to the taxes imposed by sec-
24
tion 511 (relating to imposition of tax on unrelated
25
business income of charitable, etc. organizations).
•8 1807 PCS
�29
1
2
"(2) ACCOUNT TERMINATES I F INDIVIDUAL EN-
GAGES I N PROHIBITED TRANSACTION.—
3
"(A) I N GENERAL.—If, during any taxable
4
year of the individual for whose benefit the
5
medical savings account was established, such
6
individual engages in any transaction prohibited
7
by section 4975 with respect to the account, the
8
account ceases to be a medical savings account
9
as of the first day of that taxable year.
10
"(B) ACCOUNT TREATED AS DISTRIBUTING
11
ALL ITS ASSETS.—In any case in which any ac-
12
count ceases to be a medical savings account by
13
reason of subparagraph (A) on the first day of
14
any taxable year, paragraph (1) of subsection
15
(e) shall be applied as if there were a distribu-
16
tion on such first day in an amount equal to
17
the fair market value (on such first day) of all
18
assets in the account (on such first day) and no
19
portion of such distribution were used to pay
20
medical expenses.
21
"(3) EFFECT OF PLEDGING ACCOUNT AS SECU-
22
RITY.—If, during any taxable year, the individual for
23
whose benefit a medical savings account was estab-
24
lished uses the account or any portion thereof as se-
25
curity for a loan, the portion so used is treated as
.S 1807 PCS
�30
1
distributed to that individual and not used to pay
2
medical expenses.
3
"(g) CUSTODIAL ACCOUNTS.—For purposes of this
4 section, a custodial account shall be treated as a trust if—
5
"(1) the assets of such account are held by a
6
bank (as defined in section 408(n)) or another per-
7
son who demonstrates to the satisfaction of the Sec-
8
retary that the manner in which he will administer
9
the account will be consistent with the requirements
10
of this section, and
11
"(2) the custodial account would, except for the
12
fact that it is not a trust, constitute a medical sav-
13
ings account described in subsection (d).
14 For purposes of this title, in the case of a custodial ac15 count treated as a trust by reason of the preceding sen16 tence, the custodian of such account shall be treated as
17 the trustee thereof.
18
"(h) REPORTS.—The trustee of a medical savings ac-
19 count shall make such reports regarding such account to
20 the Secretary and to the individual for whose benefit the
21 account is maintained with respect to contributions, dis22 tributions, and such other matters as the Secretary may
23 require under regulations. The reports required by this
24 subsection shall be filed at such time and in such manner
.S 1807 PCS
�31
1 and furnished to such individuals at such time and in such
2 manner as may be required by those regulations."
3
(b) DEDUCTION ALLOWED WHETHER OR NOT INDI-
4 VIDUAL ITEMIZES OTHER DEDUCTIONS.—Subsection
(a)
5 of section 62 of the Internal Revenue Code of 1986 (defin6 ing adjusted gross income), as amended by section 211,
7 is amended by inserting after paragraph (16) the following
8 new paragraph:
9
"(17)
MEDICAL SAVINGS ACCOUNTS.—The de-
10
duction allowed by section 220."
11
(c) DISTRIBUTIONS FROM MEDICAL SAVINGS AC-
12 COUNTS NOT ALLOWED AS MEDICAL EXPENSE DEDUC-
13 TION.—Section 213 of the Internal Revenue Code of 1986
14 (relating to medical, dental, etc., expenses) is amended by
15 adding at the end the following new subsection:
16
"(g) COORDINATION W I T H MEDICAL SAVINGS AC-
17 COUNTS.—The amount otherwise taken into account
18 under subsection (a) as expenses paid for medical care
19 shall be reduced by the amount (if any) of the distribu20 tions from any medical savings account of the taxpayer
21 during the taxable year which is not includible in gross
22 income by reason of being used for medical care."
23
(d) EXCLUSION OF EMPLOYER CONTRIBUTIONS TO
24 MEDICAL
25
TAXES.—
•S 1807 PCS
SAVINGS
ACCOUNTS
FROM
EMPLOYMENT
�32
1
(1) SOCIAL, SECURITY TAXES.—
2
(A) Subsection (a) of section 3121 of the
3
Internal Revenue Code of 1986 (defining
4
wages) is amended by striking "or" at the end
5
of paragraph (20), by striking the period at the
6
end of paragraph (21) and inserting "; or", and
7
by inserting after paragraph (21) the following
8
new paragraph:
9
"(22) remuneration paid to or on behalf of an
10
employee if (and to the extent that) at the time of
11
payment of such remuneration it is reasonable to be-
12
lieve that a corresponding deduction is allowable
13
under section 220."
14
(B) Subsection (a) of section 209 of the
15
Social Security Act is amended by striking "or"
16
at the end of paragraph (17), by striking the
17
period at the end of paragraph (18) and insert-
18
ing "; or", and by inserting after paragraph
19
(18) the following new paragraph:
20
"(19) remuneration paid to or on behalf of an
21
employee if (and to the extent that) at the time of
22
payment of such remuneration it is reasonable to be-
23
lieve that a corresponding deduction is allowable
24
under section 220 of the Internal Revenue Code of
25
1986."
•S 1807 PCS
�33
1
(2) RAILROAD RETIREMENT TAX.—Subsection
2
(e) of section 3231 of such Code (defining com-
3
pensation) is amended by adding at the end the fol-
4
lowing new paragraph:
5
"(10) EMPLOYER CONTRIBUTIONS TO MEDICAL
6
SAVINGS
ACCOUNTS.—The term 'compensation' shall
7
not include any payment made to or on behalf of an
8
employee if (and to the extent that) at the time of
9
payment of such remuneration it is reasonable to be-
10
lieve that a corresponding deduction is allowable
11
under section 220."
12
(3) UNEMPLOYMENT TAX.—Subsection (b) of
13
section 3306 of such Code (defining wages) is
14
amended by striking "or" at the end of paragraph
15
(15), by striking the period at the end of paragraph
16
(16) and inserting "; or", and by inserting after
17
paragraph (16) the following new paragraph:
18
"(17) remuneration paid to or on behalf of an
19
employee if (and to the extent that) at the time of
20
payment of such remuneration it is reasonable to be-
21
lieve that a corresponding deduction is allowable
22
under section 220."
23
(4) WITHHOLDING TAX.—Subsection (a) of sec-
24
tion 3401 of such Code (defining wages) is amended
25
by striking "or" at the end of paragraph (19), by
S 1807 PCS
3
�34
1
striking the period at the end of paragraph (20) and
2
inserting "; or", and by inserting after paragraph
3
(20) the following new paragraph:
4
"(21) remuneration paid to or on behalf of an
5
employee if (and to the extent that) at the time of
6
payment of such remuneration it is reasonable to be-
7
lieve that a corresponding deduction is allowable
8
under section 220."
9
(e) TAX ON EXCESS CONTRIBUTIONS.—Section 4973
10 of the Internal Revenue Code of 1986 (relating to tax on
11 excess contributions to individual retirement accounts, cer12 tain section 403(b) contracts, and certain individual re13 tirement annuities) is amended—
14
(1) by inserting "MEDICAL SAVINGS AC-
15
COUNTS," after "ACCOUNTS," in the heading of
16
such section,
17
(2) by redesignating paragraph (2) of sub-
18
section (a) as paragraph (3) and by inserting after
19
paragraph (1) the following:
20
21
22
23
24
25
"(2) a medical savings account (within the
meaning of section 220(d)),",
(3) by striking "or" at the end of paragraph
(1) of subsection (a), and
(4) by adding at the end the following new subsection:
•S 1807 PCS
�35
1
"(d) EXCESS CONTRIBUTIONS TO MEDICAL SAVINGS
2 ACCOUNTS.—For purposes of this section, in the case of
3 a medical savings account (within the meaning of section
4 220(d)), the term 'excess contributions' means the amount
5 by which the amount contributed for the taxable year to
6 the account exceeds the amount excludable from gross in7 come under section 220 for such taxable year. For pur8 poses of this subsection, any contribution which is distrib9 uted out of the medical savings account in a distribution
10 to which section 220(e)(3) applies shall be treated as an
11 amount not contributed."
12
(f) TAX ON PROHIBITED TRANSACTIONS.—Section
13 4975 of the Internal Revenue Code of 1986 (relating to
14 prohibited transactions) is amended—
15
16
(1) by adding at the end of subsection (c) the
following new paragraph:
17
"(4) SPECIAL RULE FOR MEDICAL SAVINGS AC-
18
COUNTS.—An individual for whose benefit a medical
19
savings account (within the meaning of section
20
220(d)) is established shall be exempt from the tax
21
imposed by this section with respect to any trans-
22
action concerning such account (which would other-
23
wise be taxable under this section) if, with respect
24
to such transaction, the account ceases to be a medi-
•S 1807 PCS
�36
1
cal savings account by reason of the application of
2
section 220(f)(2)(A) to such account.", and
3
(2) by inserting "or a medical savings account
4
described in section 220(d)" in subsection (e)(1)
5
after "described in section 408(a)".
6
(g) FAILURE TO PROVIDE REPORTS ON MEDICAL
7
SAVINGS ACCOUNTS.—Section
6693 of the Internal Reve-
8 nue Code of 1986 (relating to failure to provide reports
9 on individual retirement account or annuities) is
10 amended—
11
(1) by inserting "OR ON MEDICAL SAVINGS
12
ACCOUNTS" after "ANNUITIES" in the heading of
13
such section, and
14
(2) by adding at the end of subsection (a) the
15
following: "The person required by section 220(h) to
16
file
a report regarding a medical savings account at
17
the time and in the manner required by such section
18
shall pay a penalty of $50 for each failure unless it
19
is shown that such failure is due to reasonable
20
cause."
21
(h) CLERICAL AMENDMENTS.—
22
(1) The table of sections for part VII of sub-
23
chapter B of chapter 1 of the Internal Revenue Code
24
of 1986 is amended by striking the last item and in-
25
serting the following:
"Sec. 220. Medical savings accounts.
•S 1807 PCS
�37
"Sec. 221. Cross reference."
1
(2) The table of sections for chapter 43 of such
2
Code is amended by striking the item relating to sec-
3
tion 4973 and inserting the following:
"Sec. 4973. Tax on excess contributions to individual retirement
accounts, medical savings accounts, certain 403(b)
contracts, and certain individual retirement annuities."
4
(3) The table of sections for subchapter B of
5
chapter 68 of such Code is amended by inserting "or
6
on medical savings accounts" after "annuities" in
7
the item relating to section 6693.
8
(i) EFFECTIVE DATE.—The amendments made by
9 this section shall apply to taxable years beginning after
10 the date of the enactment of this Act.
1 T I T L E III—EQUAL TAX TREAT1
1
2
MENT FOR HEALTH INSUR1
3
ANCE OF SELF-EMPLOYED
1
4
AND UNINSURED.
15
SEC 301. EQUAL EXCLUSION FROM GROSS INCOME OF
16
17
HEALTH INSURANCE COVERAGE COSTS.
(a) I N GENERAL.—Part I I I of subchapter B of chap-
18 ter 1 of the Internal Revenue Code of 1986 (relating to
19 items specifically excluded from gross income) is amended
20 by inserting after section 106 the following new section:
•S 1807 PCS
�38
1 "SEC. 106A. CERTAIN HEALTH INSURANCE COVERAGE
2
3
COSTS.
"(a) I N GENERAL.—Gross income does not include
4 the applicable percentage of so much of—
5
"(1) the amounts paid by the taxpayer for cov-
6
erage under a health insurance plan (as defined in
7
section 1(3) of the Comprehensive Family Health
8
Access and Savings Act), plus
9
10
"(2) the contributions made by such taxpayer
to a medical savings account under section 220,
11 during the taxable year as do not exceed the national per
12 employee average of employer-provided contributions ex13 eluded under section 106 for the preceding taxable year.
14
15
16
17
"(b)
EXCLUSION N O T A L L O W E D TO INDIVIDUALS
E L I G I B L E FOR EMPLOYER-SUBSIDIZED COVERAGE.—
"(1) I N GENERAL.—Subsection (a) shall not
apply to any individual—
18
"(A) who is eligible to participate in any
19
subsidized health plan maintained by an em-
20
ployer of such individual or the spouse of such
21
individual, or
22
"(B) who is (or whose spouse is) a member
23
of a subsidized class of employees of an em-
24
ployer.
25
"(2)
26
SUBSIDIZED
CLASS.—For
purposes of
paragraph (1), an individual is a member of a sub•S 1807 PCS
�39
1
sidized class of employees of an employer if, at any
2
time during the 3 calendar years ending with or
3
within the taxable year, any member of such class
4
was eligible to participate in any subsidized health
5
plan maintained by such employer.
6
"(3) SPECIAL RULES.—
7
"(A) CONTROLLED GROUPS.—All persons
8
treated as a single employer under subsection
9
(a) or (b) of section 52 or subsection (m) or (o)
10
of section 414 shall be treated as a single em-
11
ployer for purposes of paragraph (2).
12
"(B) CLASSES.—Classes of employees shall
13
be determined under regulations prescribed by
14
the Secretary based on such factors as the Sec-
15
retary determines appropriate to carry out the
16
purposes of this subsection.
17
18
19
"(c) APPLICABLE PERCENTAGE.—
"(1) I N GENERAL.—For purposes of subsection
(a), the term 'applicable percentage' means—
20
"(A) 33 percent for any taxable year be-
21
ginning in 1996 or, if later, the alternate year,
22
"(B) 46 percent for any taxable year be-
23
ginning in 1997 or, if later, the alternate year,
24
"(C) 60 percent for any taxable year be-
25
ginning in 1998 or, if later, the alternate year,
•S 1807 PCS
�40
1
"(D) 73 percent for any taxable year be-
2
ginning in 1999 or, i f later, the alternate year,
•3
"(E) 86 percent for any taxable year be-
4
ginning in 2000 or, i f later, the alternate year,
5
and
6
"(F) 100 percent for taxable years begin-
7
ning with 2001 or, if later, the alternate year.
8
"(2) A L T E R N A T E YEAR.—For purposes of para-
9
graph (1), the term 'alternate year' means any tax-
10
able year other than the taxable year described the
11
applicable subparagraph of paragraph (1) as deter-
12
mined under section 1302 of the Comprehensive
13
Family Health Access and Savings Act.
14
"(d)
COORDINATION
WITH
DEDUCTIONS.—No
15 amount excluded from the gross income of the taxpayer
16 for any taxable year under this section shall be taken into
17 account for purposes of determining the allowable deduc18 tion for such year under sections 162(1), 213, and 220.
19
"(e) COORDINATION W I T H H E A L T H CARE EXPENSES
20 CREDIT.—The amount otherwise taken into account
21 under subsection (a) as expenses paid for medical care
22 shall be reduced by the amount (if any) of the amount
23 taken into account under section 34A for the taxable
24 year."
•S 1807 PCS
�41
1
2
3
(b)
EXCLUSION OP C E R T A I N H E A L T H
INSURANCE
COVERAGE COSTS FROM EMPLOYMENT T A X E S . —
(1) SOCIAL SECURITY TAXES.—
4
(A) Subsection (a) of section 3121 of the
5
Internal Revenue
Code
of 1986
(defining
6
wages), as amended by section 212(d), is
7
amended by striking "or" at the end of para-
8
graph (21), by striking the period at the end of
9
paragraph (22) and inserting "; or", and by in-
10
serting after paragraph (22) the following new
11
paragraph:
12
"(23) remuneration paid to or on behalf of an
13
employee if (and to the extent that) at the time of
14
payment of such remuneration it is reasonable to be-
15
lieve that a corresponding exclusion is allowable
16
under section 106A."
17
(B) Subsection (a) of section 209 of the
18
Social Security Act, as amended by section
19
212(d), is amended by striking "or" at the end
20
of paragraph (18), by striking the period at the
21
end of paragraph (19) and inserting "; or", and
22
by inserting after paragraph (19) the following
23
new paragraph:
24
"(20) remuneration paid to or on behalf of an
25
employee i f (and to the extent that) at the time of
•S 1807 PCS
�42
1
payment of such remuneration it is reasonable to be-
2
lieve that a corresponding exclusion is allowable
3
under section 106A of the Internal Revenue Code of
4
1986."
5
(2) RAILROAD RETIREMENT TAX.—Subsection
6
(e) of section 3231 of such Code (defining com-
7
pensation), as amended by section 212(d), is amend-
8
ed by adding at the end the following new para-
9
graph:
10
"(11) EMPLOYER CONTRIBUTIONS TO MEDICAL
11
SAVINGS ACCOUNTS.—The term 'compensation' shall
12
not include any payment made to or on behalf of an
13
employee if (and to the extent that) at the time of
14
payment of such remuneration it is reasonable to be-
15
lieve that a corresponding exclusion is allowable
16
under section 106A."
17
(3) UNEMPLOYMENT TAX.—Subsection (b) of
18
section 3306 of such Code (defining wages), as
19
amended by section 212(d), is amended by striking
20
"or" at the end of paragraph (16), by striking the
21
period at the end of paragraph (17) and inserting ";
22
or", and by inserting after paragraph (17) the fol-
23
lowing new paragraph:
24
"(18) remuneration paid to or on behalf of an
25
employee if (and to the extent that) at the time of
•S 1807 PCS
�43
1
payment of such remuneration it is reasonable to be-
2
lieve that a corresponding exclusion is allowable
3
under section 106A."
4
(4) WITHHOLDING TAX.—Subsection (a) of sec-
5
tion 3401 of such Code (defining wages), as amend-
6
ed by section 212(d), is amended by striking "or" at
7
the end of paragraph (20), by striking the period at
8
the end of paragraph (21) and inserting "; or", and
9
by inserting after paragraph (21) the following new
10
paragraph:
11
"(22) remuneration paid to or on behalf of an
12
employee if (and to the extent that) at the time of
13
payment of such remuneration it is reasonable to be-
14
lieve that a corresponding exclusion is allowable
15
under section 106A."
16
(c) CLERICAL AMENDMENT.—The table of sections
17 for part I I I of subchapter B of chapter 1 of the Internal
18 Revenue Code of 1986 is amended by inserting after the
19 item relating to section 106 the following:
"Sec. 106A. Certain health insurance coverage costs."
20
(d) EFFECTIVE DATE.—The amendments made by
21 this section shall apply to taxable years beginning after
22 the date of the enactment of this Act.
•S 1807 PCS
�44
1
2
T I T L E IV—SMALL BUSINESS
HEALTH INSURANCE POOLS
3 SEC. 401. PROmBITION OF RESTRICTIONS ON GROUPS
4
PURCHASING HEALTH INSURANCE.
5
(a) I N GENERAL.—No provision of State or local law
6 shall apply that prohibits 2 or more employers or groups
7 from obtaining coverage under a multiple employer health
8 plan.
9
(b) MULTIPLE EMPLOYER HEALTH PLAN.—For pur-
10 poses of subsection (a), the term "multiple employer
11 health plan" means a multiple employer welfare arrange12 ment (as defined in section 3(40) of the Employee Retire13 ment Income Security Act of 1974).
14 SEC 402. PROHIBITION OF STATE BENEFIT MANDATES FOR
15
16
GROUP HEALTH PLANS.
In the case of a group health plan, no provision of
17 State or local law shall apply that requires the coverage
18 of 1 or more specific benefits, services, or categories of
19 health care, or services of any class or type of provider
20 of health care.
21 SEC. 403. PROHIBITION OF RESTRICTIONS ON MANAGED
22
23
CARE.
(a) PREEMPTION OP STATE LAW PROVISIONS.—Sub-
24 ject to subsection (c), the following provisions of State law
25 are preempted and may not be enforced:
•S 1807 PCS
�45
1
(1) RESTRICTIONS ON REIMBURSEMENT RATES
2
O SELECTIVE CONTRACTING.—Any law that reR
3
stricts the ability of a group health plan to negotiate
4
reimbursement rates with providers or to contract
5
selectively with 1 provider or a limited number of
6
providers.
7
(2)
RESTRICTIONS ON DIFFERENTIAL FINAN-
8
CIAL INCENTIVES.—Any law that limits the financial
9
incentives that a group health plan may require a
10
beneficiary to pay when a non-plan provider is used
11
on a non-emergency basis.
12
13
(3)
REVIEW
METHODS.—Any law that—
14
15
RESTRICTIONS ON UTILIZATION
(A) prohibits utilization review of any or
all treatments and conditions,
16
(B) requires that such review be made (i)
17
by a resident of the State in which the treat-
18
ment is to be offered or by an individual li-
19
censed in such State, or (ii) by a physician in
20
any particular specialty or with any board cer-
21
tified specialty of the same medical specialty as
22
the provider whose services are being reviewed,
23
(C) requires the use of specified standards
24
of health care practice in such reviews or re-
•S 1807 PCS
�46
1
quires the disclosure of the specific criteria used
2
in such reviews,
3
(D) requires payments to providers for the
4
expenses of responding to utilization review re-
5
quests, or
6
7
(E) imposes liability for delays in performing such review.
8
Nothing in subparagraph (B) shall be construed as
9
prohibiting a State from (i) requiring a licensed phy-
10
sician or other health care professional be available
11
at some time in the review or appeal process, or (ii)
12
requiring that any decision in an appeal from such
13
a review be made by a licensed physician.
14
(b) GAO STUDY.—
15
(1) I N GENERAL.—The Comptroller General of
16
the United States shall conduct a study of the regu-
17
latory and legal impediments at the Federal, State,
18
and local levels of government that restrict the abil-
19
ity of small businesses and other organizations to
20
group together voluntarily to allow their employees
21
or members to pool their health insurance purchases.
22
(2) REPORT.—By not later than 2 years after
23
the date of the enactment of this Act, the Comptrol-
24
ler General shall submit a report to Congress on the
25
study conducted under paragraph (1) and shall in-
•S 1807 PCS
�47
1
elude in the report such recommendations (including
2
whether the provisions of subsection (a) should be
3
extended) as may be appropriate.
4
(c) SUNSET.—Unless otherwise provided, subsection
5 (a) shall not apply 5 years after the date of the enactment
6 of this Act.
7 T I T L E V—ASSISTANCE TO INDI8
VIDUALS WITH PREEXISTING
9
CONDITIONS IN PURCHASING
1
0
HEALTH INSURANCE
11 SEC. 501. PREEXISTING CONDITION INSURANCE POOL AL12
13
14
LOTMENT PROGRAM.
(a) DEFINITIONS.—As used in this section:
(1)
CATASTROPHIC
HEALTH
INSURANCE
15
PLAN.—The term "catastrophic health insurance
16
plan" has the meaning given such term by section
17
220(c)(2) of the Internal Revenue Code of 1986 (de-
18
termined without regard to subparagraph (B)(i)).
19
(2) PREEXISTING CONDITION.—The term "pre-
20
. existing condition" means, with respect to coverage
21
under a health insurance plan, a condition that has
22
been diagnosed or treated during the 6-month period
23
ending on the day before the first date of such cov-
24
erage (without regard to any waiting period).
•S 1807 PCS
�48
1
(3)
PROGRAM
ADMINISTRATOR.—The
term
2
"program administrator" means the entity respon-
3
sible for the administration of the program estab-
4
lished under subsection (e)(2).
5
(b) ESTABLISHMENT.—The Secretary shall establish
6 and administer a program to provide allotments to States
7 to enable such States to operate State-wide insurance risk
8 pools to provide health insurance coverage to individuals
9 with preexisting conditions.
10
(c) ALLOTMENTS TO STATES.—The Secretary shall
11 allot to a State under this section for each fiscal year an
12 amount equal to the State expected loss amount for such
13 fiscal year as determined under subsection (e)(3)(B)(v).
14
(d) APPLICATION.—To be eligible to receive an allot-
15 ment for a fiscal year under this section, a State shall
16 prepare and submit an application to the Secretary at
17 such time, in such manner, and containing such informa18 tion as the Secretary may by rule require. Such applica19 tion shall include an assurance by the State that all ad20 ministrative costs of the insurance pool program shall be
21 borne by the State from resources other than such allot22 ment.
23
(e) STATE PROGRAM.—
24
(1) USE OP FUNDS.—The State shall use
25
amounts received under this section to provide pre-
•S 1807 PCS
�49
1
mium assistance under the program established
2
under paragraph (2).
3
(2) ESTABLISHMENT.—The State shall estab-
4
lish an insurance pool program to provide premium
5
assistance to an individual who has a preexisting
6
condition and who is otherwise unable to purchase
7
coverage under an affordable health insurance pol-
8
icy, to enable such individual to obtain such cov-
9
erage.
10
(3) B I D PROCESS.—
11
(A) I N GENERAL.—With respect to a pro-
12
gram established under paragraph (2), the
13
State shall, for each fiscal year, accept bids
14
from private insurance carriers that desire to
15
administer the program and provide cata-
16
strophic health insurance plans to individuals
17
with preexisting conditions under the program.
18
The State may accept such a bid or, after de-
19
termining that no such bids are acceptable, ad-
20
minister the program itself.
21
(B) CONSIDERATION OF BIDS.—In consid-
22
ering bids submitted under subparagraph (A),
23
the State, in consultation with private insurance
24
carriers, shall compile a profile of individuals
S 1807 PCS-
�50
1
with preexisting conditions. Such profile shall
2
consider—
3
(i) the number of individuals who may
4
be eligible for premium assistance under
5
the State program for the fiscal year in-
6
volved;
7
(ii) the estimated cost of providing
8
medical services for the eligible individuals
9
for the fiscal year involved;
10
(iii) the estimated amount of pre-
11
miums to be paid by such eligible individ-
12
uals for the fiscal year involved;
13
(iv) the estimated amount by which
14
the medical service costs will exceed the
15
premiums received for the fiscal year in-
16
volved;
17
(v) the estimated amount of Federal
18
assistance needed under this section to
19
cover the losses estimated under clause
20
(iv); and
21
(vi) any other information determined
22
23
appropriate by the State.
(4) PROVISION OF PREMIUM ASSISTANCE.—
24
(A) ELIGIBILITY.—To be eligible to receive
25
premium assistance under a State program
•S 1807 PCS
�51
1
under this section, an individual shall be deter-
2
mined by the program administrator—
3
(i) to have a preexisting condition;
4
(ii) to be charged under a catastrophic
5
health insurance plan, a premium which
6
exceeds 150 percent of the average pre-
7
mium paid for catastrophic health insur-
8
ance plans (considering residence, age and
9
gender);
10
(iii) not to have any avoidable health
11
conditions, including medical conditions re-
12
lated to smoking, alcohol abuse, drug
13
abuse, and other activities harmful to
14
health, which are the sole reason for the
15
excess described in clause (ii); and
16
(iv) not to be described in section 601.
17
(B) AMOUNT.—An individual determined
18
to be eligible under subparagraph (A) shall re-
19
ceive premium assistance under this section in
20
an amount that equals the amount by which the
21
premium paid by such individual for a cata-
22
strophic health insurance plan exceeds the
23
greater of—
24
(i) 150 percent of the average pre-
25
mium paid for catastrophic health insur-
.8 1807 PCS
�52
1
ance plans (considering residence, age and
2
gender), or
3
(ii) 7.5 percent of the individual or
4
family adjusted gross income of the indi-
5
vidual,
6
but only to the extent such excess is not attrib-
7
utable to any avoidable health conditions, in-
8
eluding medical conditions related to smoking,
9
alcohol abuse, drug abuse, and other activities
10
11
harmful to health.
(f) P A Y M E N T S . ^
12
(1) I N GENERAL.—The Secretary shall pay to
13
each State for which an application has been ap-
14
proved under this section for each fiscal year an
15
amount not to exceed its allotment under subsection
16
(c) to be expended by the State in accordance with
17
the terms of the application for the fiscal year for
18
which the allotment is to be made.
19
(2)
METHOD
OP PAYMENTS.—The Secretary
20
may make payments to a State in installments, and
21
in advance or, by way of reimbursement, with nec-
22
essary adjustments due to overpayments or under-
23
payments, as the Secretary may determine appro-
24
priate.
•S 1807 PCS
�53
1
(3) STATE SPENDING
OF PAYMENTS.—Pay-
2
ments to a State from the allotment under sub-
3
section (c) for any fiscal year must be expended by
4
the State in that fiscal year or in the succeeding fis-
5
cal year.
6
(g) AUTHORIZATION OF APPROPRIATIONS.—There
7 are authorized to be appropriated such sums as may be
8 necessary to carry out this section.
9
(h) EFFECTIVE DATE.—
10
(1) I N GENERAL.—The provisions of this title
11
shall apply with respect to payments made to indi-
12
viduals in calendar years beginning with 1996 or, if
13
later, with the alternate year.
14
(2) ALTERNATE YEAR.—For purposes of para-
15
graph (1), the term "alternate year" means any cal-
16
endar year other than 1996 as determined under
17
section 1302 of the Comprehensive Family Health
18
Access and Savings Act.
1 T I T L E VI—ENCOURAGE RESPON9
2
0
SIBLE BEHAVIOR BY THE F I 2
1
NANCIALLY CAPABLE
22 SEC 601. ONE YEAR WINDOW TO PURCHASE HEALTH IN23
24
SURANCE COVERAGE.
Any individual with family income exceeding 200 per-
25 cent of the income official poverty line (as determined
•S 1807 PCS
�54
1 under section 34A of the Internal Revenue Code of 1986),
2 or who is eligible for a partial or full credit to purchase
3 a catastrophic health insurance plan under such section,
4 but who fails to purchase coverage under a health insur5 ance plan providing coverage at least equal to such a cata6 strophic health insurance plan within 1 year of the date
7 of the enactment of this Act, shall not be eligible for the
8 insurance pool program under title V of this Act.
9 SEC. 602. PROHIBITION OF RESTRICTIONS RELATING TO
10
11
THE USE OF COLLECTION PROCEDURES.
No provision of Federal, State, or local law shall
12 apply that prohibits the use of any statutory procedure
13 for the collection of unpaid debts for medical expenses in14 curred by individuals described in section 601.
1 T I T L E VII—ASSISTANCE TO LOW5
1
6
INCOME WORKERS TO PURn
CHASE HEALTH CARE INSUR1
8
ANCE
19 SEC. 701. REFUNDABLE CATASTROPHIC HEALTH INSUR20
21
ANCE PLAN CREDIT.
(a) I N GENERAL.—Subpart C of part IV of sub-
22 chapter A of chapter 1 of the Internal Revenue Code of
23 1986 (relating to refundable personal credits) is amended
24 by inserting after section 34 the following new section:
•S 1807 PCS
�55
1 "SEC. 34A. CATASTROPHIC HEALTH INSURANCE PLAN PRE2
3
MIUMS.
"(a) ALLOWANCE OF CREDIT.—In the case of a
4 qualified individual, there shall be allowed as a credit
5 against the tax imposed by this subtitle for the taxable
6 year an amount equal to the applicable percentage of the
7 premiums for a catastrophic health insurance plan paid
8 by such individual during the taxable year.
9
"(b) QUALIFIED INDIVIDUALS.—For purposes of this
10 section:
11
"(1) IN GENERAL.—The term 'qualified individ-
12
ual' means the taxpayer, the spouse of the taxpayer,
13
and each dependent of the taxpayer (as defined in
14
section 152) who is enrolled in a catastrophic health
15
insurance plan.
16
"(2) FEDERALLY COVERED INDIVIDUALS.—The
17
term 'qualified individual' does not include any indi-
18
vidual whose medical care is covered under titles
19
XIX and XVIII of the Social Security Act.
20
"(3) SPECIAL RULE I N THE CASE OF CHILD OF
21
DIVORCED PARENTS, ETC.—Any
22
tion 152(e) applies shall be treated as a dependent
23
of both parents.
24
child to whom sec-
"(4) MARRIAGE RULES.—The determination of
25
whether an individual is married at any time during
26
the taxable year shall be made in accordance with
•S 1807 PCS
�56
1
the provisions of section 6013(d) (relating to deter-
2
mination of status as husband and wife).
3
"(c) APPLICABLE PERCENTAGE.—For purposes of
4 subsection (a), the applicable percentage for any taxable
5 year is 100 percent reduced (but not below zero percent)
6 by 1 percentage point for each 1 percentage point (or por7 tion thereof) the qualified individual's family income ex8 ceeds 100 percent of the income official poverty line (as
9 defined by the Office of Management and Budget, and re10 vised annually in accordance with section 673(2) of the
11 Omnibus Budget Reconciliation Act of 1981) applicable
12 to a family of the size involved.
13
"(d) CATASTROPHIC HEALTH INSURANCE PLAN.—
14 For purposes of this section, the term 'catastrophic health
15 insurance plan' means a health plan covering specified ex16 penses incurred by an individual for medical care (as de17 fined in section 220(c)(2)(B)(ii)) for such individual and
18 the spouse and dependents (as so defined) of such individ19 ual only to the extent such expenses covered by the plan
20 for any calendar year exceed the greater of—
21
22
23
24
"(1) 20 percent of the adjusted gross income of
such individual for such year, or
"(2) $3,000.
"(e) OTHER DEFINITIONS AND SPECIAL RULES.—
25 For purposes of this section:
•8 1807 PCS
�57
1
"(1) DETERMINATIONS OP INCOME.—
2
"(A) I N GENERAL.—The term 'income'
3
means adjusted gross income (as defined in sec-
4
tion 62(a))—
5
"(i) determined without regard to sec-
6
tions 135, 162(1), 911, 931, and 933; and
7
"(ii) increased by—
8
"(I) the amount of interest re-
9
ceived or accrued which is exempt
10
from tax, plus
11
"(II) the amount of social secu-
12
rity benefits (described in section
13
86(d)) which is not includible in gross
14
income under section 86.
15
"(B) FAMILY INCOME.—The term 'family
16
income' means, with respect to a family, the
17
sum of the income for all members of the fam-
18
ily, not including the income of a dependent
19
child with respect to which no return is re-
20
quired.
21
"(C) FAMILY SIZE.—The family size to be
22
applied under this section, with respect to fam-
23
ily income, is the number of individuals in-
24
eluded in the family for purposes of coverage
25
under a catastrophic health insurance plan.
•S 1807 PCS
�58
1
"(2) COORDINATION WITH ADVANCE PAYMENT
2
AND MINIMUM TAX.—Rules
similar to the rules of
3
subsections (g) and (h) of section 32 shall apply to
4
any credit to which this section applies.
5
"(f) REGULATIONS.—The Secretary shall prescribe
6 such regulations as may be necessary to carry out the pur7 poses of this section.
8
9
10
"(g) APPLICATION OP SECTION.—
"(1) I N GENERAL.—This section shall apply
with respect to—
11
"(A) any individual with a filing status de-
12
scribed in subsection (a), (b), or (d) of section
13
1 and whose family income is less than 100 per-
14
cent of the income official poverty line (as de-
15
fined by the Office of Management and Budget,
16
and revised annually in accordance with section
17
673(2) of the Omnibus Budget Reconciliation
18
Act of 1981) applicable to a family of the size
19
involved, in any taxable year beginning with
20
1997 or, if later, the alternate year,
21
"(B) any individual with a filing status de-
22
scribed in subsection (c) of section 1 and whose
23
family income is less than 100 percent of such
24
income official poverty line, in any taxable year
•S 1807 PCS
�59
1
beginning with 1998 or, if later, the alternate
2
year,
3
"(C) any individual with a filing status de-
4
scribed in subsection (a), (b), or (d) of section
5
1 and whose family income is equal to or ex-
6
ceeds 100 percent of such income official pov-
7
erty line, but only to the extent of 33 percent
8
of the credit allowable under this section, in any
9
taxable year beginning with 1999 or, if later,
10
the alternate year, and
11
"(D) any individual with a filing status de-
12
scribed in subsection (a), (b), (c), or (d) of sec-
13
tion 1 and whose family income is equal to or
14
exceeds 100 percent of such income official pov-
15
erty line, in any taxable year beginning with
16
2000 or, if later, the alternate year.
17
"(2) ALTERNATE YEAR.—For purposes of para-
18
graph (1), the term 'alternate year' means any tax-
19
able year other than the taxable year described the
20
applicable subparagraph of paragraph (1) as deter-
21
mined under section 1302 of the Comprehensive
22
Family Health Access and Savings Act.
23
(b) ADVANCE PAYMENT OF CREDIT.—Chapter 25 of
24 the Internal Revenue Code of 1986 (relating to general
•S 1807 PCS
�60
1 provisions relating to employment taxes) is amended by
2 inserting after section 3507 the following new section:
3 "SEC.
3507A.
ADVANCE
PAYMENT OF CATASTROPHIC
4
HEALTH INSURANCE PLAN PREMIUMS CRED-
5
IT.
6
"(a) GENERAL RULE.—Except as otherwise provided
7 in this section, every employer making payment of wages
8 with respect to whom a catastrophic health insurance plan
9 eligibility certificate is in effect shall, at the time of paying
10 such wages, make an additional payment equal to such
11 employee's catastrophic health insurance plan advance
12 amount.
13
"(b) CATASTROPHIC HEALTH INSURANCE PLAN E L I -
14 GIBILITY CERTIFICATE.—For purposes of this title, a cat15 astrophic health insurance plan eligibility certificate is a
16 statement furnished by an employee to the employer
17 which—
18
"(1) certifies that the employee will be eligible
19
to receive the credit provided by section 34A for the
20
taxable year,
21
"(2) certifies that the employee does not have
22
a catastrophic health insurance plan eligibility cer-
23
tificate in effect for the calendar year with respect
24
to the payment of wages by another employer,
•S 1807 PCS
�61
1
"(3) states whether or not the employee's
2
spouse has a catastrophic health insurance plan eli-
3
gibility certificate in effect, and
4
"(4) estimates the amount of premiums for a
5
catastrophic health insurance plan (as defined in
6
section 34A(d)) for the calendar year.
7 For purposes of this section, a certificate shall be treated
8 as being in effect with respect to a spouse if such a certifi9 cate will be in effect on the first status determination date
10 following the date on which the employee furnishes the
11 statement in question.
12
"(c) CATASTROPHIC HEALTH INSURANCE PLAN AD-
13 VANCE AMOUNT.—
14
"(1) I N GENERAL.—For purposes of this title,
15
the term 'catastrophic health insurance plan advance
16
amount' means, with respect to any payroll period,
17
the amount determined—
18
19
"(A) on the basis of the employee's wages
from the employer for such period,
20
"(B) on the basis of the employee's esti-
21
mated premiums for a catastrophic health in-
22
surance plan (as so defined) included in the cat-
23
astrophic health insurance plan eligibility cer-
24
tificate, and
•S 1807 PCS
�62
1
"(C) in accordance with tables provided by
2
the Secretary.
3
"(2) ADVANCE AMOUNT TABLES.—The tables
4
referred to in paragraph (1)(C) shall be similar in
5
form to the tables prescribed under section 3402
6
and, to the maximum extent feasible, shall be coordi-
7
nated with such tables and the tables prescribed
8
under section 3507(c).
9
"(d) OTHER RULES.—For purposes of this section,
10 rules similar to the rules of subsections (d) and (e) of sec11 tion 3507 shall apply.
12
"(e) REGULATIONS.—The Secretary shall prescribe
13 such regulations as may be necessary to carry out the pur14 poses of this section."
15
(c) CREDIT AMOUNT NOT ALLOWED AS MEDICAL
16 EXPENSE DEDUCTION.—Section 213 of the Internal Rev17 enue Code of 1986 (relating to medical, dental, etc., ex18 penses), as amended by section 212(c), is amended by
19 adding at the end the following new subsection:
20
"(h) COORDINATION WITH CATASTROPHIC HEALTH
21 INSURANCE PLAN PREMIUMS CREDIT.—The amount oth22 erwise taken into account under subsection (a) as expenses
23 paid for medical care shall be reduced by the amount (if
24 any) of the amount taken into account under section 34A
25 for the taxable year."
•S 1807 PCS
�63
1
(d) CLERICAL A M E N D M E N T S . —
2
(1) The table of sections for subpart A of part
3
I V of subchapter A of chapter 1 of the Internal Rev-
4
enue Code of 1986 is amended by inserting after the
5
item relating to section 34 the following new item:
"See. 34A. Catastrophic health insurance plan premiums."
6
(2) The table of sections for chapter 25 of such
7
Code is amended by adding after the item relating
8
to section 3507 the following new item:
"Sec. 3507A. Advance payment of catastrophic health insurance
plan premiums credit."
9
SEC. 702. PROHIBITION OF RESTRICTIONS RELATING TO
10
11
THE USE OF COLLECTION PROCEDURES.
No provision of Federal, State, or local law shall
12 apply that prohibits the use of any statutory procedure
13 for the collection of unpaid debts for medical expenses in14 curred by individuals who are eligible for the credit al15 lowed under section 34A of the Internal Revenue Code of
16 1986, but who fail to claim such credit.
1 T I T L E VIII—REWARD PREVEN7
1
8
TIVE
MEDICINE
AND
1
9
HEALTHY LIFESTYLES
20 SEC. 801. REWARD PREVENTIVE MEDICINE AND HEALTHY
21
22
LIFESTYLES.
In the case of any health insurance plan, no provision
23 of State or local law shall apply that restricts the reduces 1807 P S
C
�64
1 tion of premiums or the allowance of incentives with re2 spect to such plans for individuals who pursue healthy life3 styles.
4 T I T L E IX—REFORM MEDICAID
5
AND
EXPAND
CHOICES
6
UNDER MEDICARE
7
Subtitle A—Medicaid
8 SEC. 901. CAP ON FEDERAL PAYMENTS MADE FOR MEDI9
CAL ASSISTANCE UNDER THE MEDICAID PRO-
10
GRAM.
11
(a) I N GENERAL.—Title XEK (42 U.S.C. 1396 et
12 seq.) is amended by redesignating section 1931 as section
13 1932 and by inserting after section 1930 the following new
14 section:
15
"CAP ON FEDERAL PAYMENT MADE FOR MEDICAL
16
ASSISTANCE
17
" S E C 1931. (a) ANNUAL FEDERAL CAP.—For pur-
18 poses of furnishing medical assistance to eligible individ19 uals, the Secretary shall pay to a State for a fiscal year
20 under section 1903 an amount that does not exceed the
21 State total funding amount determined under subsection
22 (b).
23
24
"(b) STATE TOTAL FUNDING AMOUNT.—
"(1) I N GENERAL—A State's total funding
25
amount for a fiscal year is an amount equal to the
26
sum of—
•S 1807 PCS
�65
1
"(A) the State's acute care funding
2
amount for the fiscal year determined under
3
subsection (c); and
4
"(B) the State's long-term care funding
5
amount for the fiscal year determined under
6
subsection (d).
7
"(2) ESTIMATIONS OP AND ADJUSTMENTS TO
8
STATE TOTAL
9
FUNDING AMOUNT.—The Secretaiy
shall—
10
"(A) establish a process for estimating the
11
State total funding amount under this sub-
12
section at the beginning of each fiscal year and
13
ac^justing such amount during such fiscal year;
14
and
15
"(B) notify each State of the estimations
16
and adjustments referred to in subparagraph
17
(A).
18
"(e) STATE ACUTE CARE FUNDING AMOUNT.—
19
"(1) I N GENERAL.—A State's acute care fund-
20
ing amount for a fiscal year is an amount equal to
21
the product of—
22
"(A) the per capita acute care funding
23
amount determined under paragraph (2) for the
24
State for such fiscal year, multiplied by
S 1807 PCS-
�66
1
"(B) the total number of eligible individ-
2
uals receiving medical assistance in the form of
3
acute medical services in the State during the
4
5
6
fiscal
year.
"(2)
PER
CAPITA
ACUTE
CARE
FUNDING
AMOUNT.—
7
"(A) I N GENERAL.—The Secretaiy shall
8
calculate for each State a per capita acute care
9
funding amount in accordance with subpara-
10
graph (B) for each fiscal year.
11
12
"(B)
DETERMINATION
OF PER CAPITA
ACUTE CARE FUNDING AMOUNTS.—
13
"(i) I N GENERAL.—The per capita
14
acute care funding amount for a State
15
shall be—
16
"(I) for fiscal year 1995, an
17
amount equal to the base acute care
18
per capita funding amount (as deter-
19
mined under clause (ii)) updated by
20
the estimated change in the medical
21
consumer price index through the
22
midpoint offiscalyear 1995; and
23
"(II) for fiscal year 1996 and
24
succeeding fiscal years, an amount
25
equal to the amount determined under
•S 1807 PCS
�67
1
this clause for the previous fiscal year
2
updated through the midpoint of the
3
fiscal
year by the estimated percent-
4
age change in the medical consumer
5
price index during the 12-month pe-
6
riod ending at that midpoint, with ap-
7
propriate adjustments to reflect pre-
8
vious underestimations
9
mations under this clause in the pro-
10
jected percentage change in the medi-
11
cal consumer price index.
12
"(ii) BASE PER CAPITA ACUTE CARE
13
FUNDING AMOUNT.—The base per capita
14
acute care funding amount for a State is
15
an amount equal to the quotient of—
or overesti-
16
" ( I ) the total amount of Federal
17
funds paid to such State under sec-
18
tion 1903 for fiscal year 1993 for fur-
19
nishing medical assistance in the form
20
of acute medical services to eligible in-
21
dividuals; divided by
22
" ( I I ) the total number of eligible
23
individuals who received medical as-
24
sistance in the form of acute medical
•S 1807 pes
�68
1
services in such State during fiscal
2
year 1993.
3
4
"(d)
STATE
LONG-TERM
CARE
FUNDING
AMOUNT.—
5
"(1) I N GENERAL.—A State's long-term care
6
funding amount for a fiscal year is an amount equal
7
to the product of—
8
"(A) the per capita long-term care funding
9
amount determined under paragraph (2) for the
10
State for such fiscal year, multiplied by
11
"(B) the total number of eligible individ-
12
uals receiving medical assistance in the form of
13
long-term care services in the State during the
14
15
16
fiscal
year.
"(2)
P E R CAPITA LONG-TERM CARE
FUNDING
AMOUNT.—
17
"(A) I N GENERAL.—The Secretary shall
18
calculate for each State a per capita long-term
19
care funding amount in accordance with sub-
20
paragraph (B) for each fiscal year.
21
22
"(B)
DETERMINATION
OF
PER
CAPITA
LONG-TERM CARE FUNDING AMOUNTS.—
23
"(i) I N GENERAL.—The per capita
24
long-term care funding amount for a State
25
shall be—
•S 1807 PCS
�69
1
"(I) for fiscal year 1995, an
2
amount equal to the base long-term
3
care per capita funding amount (as
4
determined under clause (ii)) updated
5
by the estimated change in the medi-
6
cal consumer price index through the
7
midpoint offiscalyear 1995; and
8
"(II) for fiscal year 1996 and
9
succeeding fiscal years, an amount
10
equal to the amount determined under
11
this clause for the previous fiscal year
12
updated through the midpoint of the
13
fiscal
year by the estimated percent-
14
age change in the medical consumer
15
price index during the 12-month pe-
16
riod ending at that midpoint, with ap-
17
propriate adjustments to reflect pre-
18
vious underestimations or overesti-
19
mations under this clause in the pro-
20
jected percentage change in the medi-
21
cal consumer price index.
22
"(ii) BASE PER CAPITA LONG-TERM
23
CARE FUNDING AMOUNT.—The
24
capita long-term care funding amount for
•8 1807 PCS
base per
�70
1
a State is an amount equal to the quotient
2
of—
3
"(I) the total amount of Federal
4
funds paid to such State under sec-
5
tion 1903 forfiscalyear 1993 for fur-
6
nishing medical assistance in the form
7
of long-term care services to eligible
8
individuals; divided by
9
"(II) the total number of eligible
10
individuals who received medical as-
11
sistance in the form of long-term care
12
medical services in such State during
13
14
15
fiscal
year 1993.
"(e) DEFINITIONS.—For purposes of this section:
"(1)
ACUTE MEDICAL SERVICES.—The
term
16
'acute medical services' means all of the care and
17
services furnished to individuals eligible under a
18
State plan under this title other than long-term care
19
services.
20
"(2) ELIGIBLE INDIVIDUAL.—The term 'eligible
21
individual' means an individual who is a member of
22
any group of individuals described
23
1902(a)(10) that is eligible to receive medical assist-
24
ance under the State plan under this title.
•S 1807 PCS
in section
�71
1
"(3) LONG-TERM CARE SERVICES.—The term
2
'long-term care services' means the following care
3
and services furnished to individuals eligible under a
4
State plan under this title:
5
6
"(A) Nursing facility services (as defined
in section 1905(f)).
7
"(B) Intermediate care facility for the
8
mentally retarded services (as defined in section
9
1905(d)).
10
11
"(C) Personal care services (as described
in section 1905(a)(24)).
12
13
"(D) Private duty nursing services (as referred to in section 1905(a)(8)).
14
"(E) Home or community-based services
15
furnished under a waiver granted under sub-
16
section (c), (d), or (e) of section 1915.
17
"(F) Home and community care furnished
18
to functionally disabled
19
under section 1929.
20
21
"(G) Community supported living arrangements services under section 1930.
22
23
"(H) Case-management services (as described in section 1915 (g) (2)).
24
25
elderly individuals
"(I) Home health care services (as referred
to in section 1905(a)(7)).
•S 1807 PCS
�72
1
"(J) Hospice care.
2
"(4) MEDICAL CONSUMER PRICE INDEX.—The
3
term 'medical consumer price index' means the
4
consumer price index for medical services as deter-
5
mined by the Bureau of Labor Statistics."
6
(b) REQUIRING STATE MAINTENANCE OF EFFORT.—
7 Section 1902(a) (42 U.S.C. 1369a(a)) is amended—
8
9
10
11
12
13
(1) by striking "and" at the end of paragraph
(61);
(2) by striking the period at the end of paragraph (62) and inserting "; and"; and
(3) by adding at the end the following new
paragraph:
14
"(63) provide that the State will continue to
15
make eligible for medical assistance under section
16
1902(a)(10) any class or category of individuals eli-
17
gible for medical assistance under such section dur-
18
ing fiscal year 1993."
19
(c) EFFECTIVE DATE.—The amendments made by
20 this section shall be effective with respect to fiscal years
21 beginning on or after October 1, 1994.
22 SEC 902. WAIVERS FOR FURNISHING MEDICAL ASSIST23
24
ANCE UNDER THE MEDICAID PROGRAM.
(a) I N GENERAL.—Title XTX of the Social Security
25 Act (42 U.S.C. 1396 et seq.), as amended by section 901,
•S 1807 PCS
�73
1 is amended by redesignating section 1932 as section 1933
2 and by inserting after section 1931 the following new sec3 tion:
4
"WAIVERS FOR FURNISHING MEDICAL ASSISTANCE
5
UNDER THE MEDICAID PROGRAM
6
"SEC. 1932. (a) I N GENERAL.—The Secretary shall
7 establish a process under which a State with a State plan
8 approved under this title may apply for waivers of any
9 of the requirements under this title in order to establish
10 innovative and cost-effective programs for furnishing med11 ical assistance to eligible individuals (as defined in section
12 1931(e)(2)).
13
"(b) APPLICATION FOR WAIVERS.—
14
"(1) I N GENERAL.—In order to receive a waiver
15
under subsection (a), a State shall submit an appli-
16
cation to the Secretary at such time and containing
17
such information as the Secretary determines appro-
18
priate.
19
"(2) APPROVAL OF APPLICATION.—
20
"(A) INITIAL REVIEW.—Within 60 days
21
after an application is submitted by the State
22
under this subsection, the Secretary shall review
23
and approve such application or provide the
24
State with a list of the modifications that are
25
necessary for such application to be approved.
•S 1807 PCS
�74
1
"(B)
ADDITIONAL
REVIEW.—Within
60
2
days after a State resubmits any application
3
under this subsection, the Secretary shall review
4
and approve such application or provide the
5
State with a summary of which items included
6
on the list provided to the State under subpara-
7
graph (A) remain unsatisfied. A State may re-
8
submit an application under this subparagraph
9
as many times as necessary to gain approval.
10
"(c) DURATION OF WAIVERS.—Except as provided in
11 subsection (d), any waiver under this section shall be
12 granted for a period of 5 years, and renewed for subse13 quent 5-year periods, unless the Secretary determines that
14 the State has failed to furnish medical assistance in ac15 cordance with the terms of the waiver and any provisions
16 of this title with respect to which the Secretary has not
17 granted a waiver.
18
"(d)
TERMINATION
OF WAIVERS.—The Secretary
19 may terminate a waiver granted under this section at any
20 time if the Secretary determines that the State has failed
21 to furnish medical assistance in accordance with the terms
22 of the waiver and any provisions of this title with respect
23 to which the Secretary has not granted a waiver.
24
"(e) REPORTS.—The State shall evaluate the pro-
25 grams operated under a waiver granted under this section
•S 1807 PCS
�75
1 and submit reports to the Secretary at such times and
2 containing such information as the Secretary shall re3 quire."
4
(b) EFFECTIVE DATE.—The amendment made by
5 subsection (a) shall be effective with respect tofiscalyears
6 beginning on or after October 1, 1994.
7
Subtitle B—Medicare
8 SEC 951. INDIVIDUAL ELECTION FOR TYPE OF COVERAGE.
9
10
(a) ELECTION FOR NEW ELIGIBLES.—
(1) I N GENERAL.—Title XVIII of the Social Se-
ll
curity Act (42 U.S.C. 1395 et seq.) is amended by
12
adding after section 1804 the following new section:
13
"INDIVIDUAL ELECTION FOR TYPE OF COVERAGE
14
"SEC. 1805. (a) An individual may enroll with a pri-
15 vate health care arrangement under section 1893 or an
16 eligible organization under section 1876 only if such indi17 vidual has elected to enroll with such an arrangement or
18 organization within 1 year after the date that the
19 individual—
20
21
22
"(1) becomes entitled to benefits under part A
of this title, or
"(2) foregoes a health benefit plan operated,
23
sponsored, or contributed to, by the individual's em-
24
ployer or former employer (or the employer or
25
former employer of the individual's spouse) where
26
such plan was the individual's primary insurer.
•S 1807 PCS
�76
1
"(b) If an individual makes an election under sub-
2 section (a), such individual shall be entitled to payment
3 under this title only if such individual remains enrolled
4 with an arrangement or organization described in such
5 subsection."
6
(2) EFFECTIVE DATE.—The amendment made
7
by paragraph (1) shall apply with respect to individ-
8
uals who become entitled to benefits under part A of
9
title XVIII of the Social Security Act on or after Oc-
10
tober 1, 1994.
11
(b) ELECTION FOR CURRENT ELIGIBLES.—
12
(1)
ENROLLMENT WITH A PRIVATE HEALTH
13
CARE
ARRANGEMENT
14
OR
ELIGIBLE
ORGANIZA-
TION.—
15
(A) I N GENERAL.—If an individual is enti-
16
tied to benefits under part A of title XVIII of
17
the Social Security Act on or before September
18
30, 1994, such individual may elect to enroll
19
with a private health care arrangement under
20
section 1893 of such Act or an eligible organi-
21
zation under section 1876 of such Act only if
22
such election is made on or before March 31,
23
1995.
24
(B) PAYMENT.—If an individual makes an
25
election under subparagraph (A), such individ-
•S 1807 PCS
�77
1
ual shall be entitled to payment under title
2
XVIII of the Social Security Act only if such
3
individual remains enrolled with an arrange-
4
ment or organization described in such subpara-
5
graph.
6
(2) DECISION TO RETURN TO PEE FOR SERVICE
7
PLAN.—If an individual is enrolled with an eligible
8
organization under section 1876 of the Social Secu-
9
rity Act (42 U.S.C. 1395mm) on or before Septem-
10
ber 30, 1994, such individual may terminate the in-
11
dividual's enrollment with such organization on or
12
before March 31, 1995, without being subject to the
13
payment limitation described in paragraph (1)(B).
14
15
(3) EFFECTIVE DATE.—This subsection shall
take effect on October 1, 1994.
16 SEC. 952. HEALTH CARE COVERAGE UNDER A PRIVATE
17
18
HEALTH CARE ARRANGEMENT.
(a) I N GENERAL.—Part C of title XVIII of the Social
19 Security Act (42 U.S.C. 1395x et seq.) is amended by add20 ing at the end the following new section:
21
22
"PAYMENTS TO PRIVATE HEALTH CARE ARRANGEMENTS
"SEC. 1893. (a) PAYMENTS.—
23
"(1) I N GENERAL.—The Secretary shall make
24
payment as specified in subsection (c) for each indi-
25
vidual who is enrolled with a private health care ar-
26
rangement.
•S 1807 PCS
�78
1
"(2) SOLE PAYMENTS.—Payments to an indi-
2
vidual under this section shall be in lieu of the
3
amounts that would otherwise be payable pursuant
4
to sections 1814(b) and 1833(a).
5
"(b) CERTIFICATION.—
6
"(1) I N GENERAL.—An individual who is en-
7
rolled with a private health care arrangement shall
8
certify to the Secretary, by not later than December
9
15 of each year, the individual's enrollment for the
10
coming calendar year. Such certification shall indi-
11
cate the individual's annual premium amount.
12
"(2) FAILURE TO CERTIFY.—For purposes of
13
determining payment under subsection (c), an indi-
14
vidual who fails to provide the certification described
15
in paragraph (1) shall be deemed to be enrolled with
16
the private health care arrangement at the same
17
premium for which the Secretary last received a cer-
18
tification.
19
"(c) PAYMENT AMOUNT SPECIFIED.—
20
"(1) PRIVATE HEALTH CARE ARRANGEMENT.—
21
"(A) I N GENERAL—In January of each
22
year, the Secretaiy shall pay the private health
23
care arrangement certified by the individual
24
under subsection (b)(1), the lesser of—
•S 1807 PCS
�79
1
"(i) the individual's annual premium
2
amount, or
3
"(ii) the per capita amount specified
4
under paragraph (2).
5
"(B) RETURN OF PAYMENT.—In the event
6
of the death of an individual, the private health
7
care arrangement certified by the individual
8
under subsection (b)(1) shall reimburse the Sec-
9
retary for a prorated portion of the amount re-
10
ceived under
subparagraph
(A), less any
11
amount expended by the private health care ar-
12
rangement for the health care expenses for such
13
individual. Such amount (if any) shall be depos-
14
ited in the Federal Hospital Insurance Trust
15
Fund and the Federal Supplementary Medical
16
Insurance Trust Fund in the same proportion
17
as such payment was paid by each trust fund
18
under subsection (e).
19
"(2) PER CAPITA AMOUNT.—
20
"(A) I N GENERAL.—The Secretary shall
21
annually determine, and shall announce (in a
22
manner intended to provide notice to interested
23
parties) not later than September 7 before the
24
calendar year concerned, the per capita amount.
•S 1807 PCS
�80
1
"(B)
DETERMINATION
OF PER CAPITA
2
RATE OF PAYMENT.—The per capita amount
3
for each group of individuals (based on resi-
4
dency, age, and gender) is equal to—
5
"(i) the total estimated government
6
expenditures for all benefits under parts A
7
and B of this title in the coming calendar
8
year for such group (excluding any pre-
9
miums, deductibles, and copayments paid
10
by individuals for benefits under part B),
11
divided by
12
"(ii) the total estimated number of in-
13
dividuals in such group expected to be enti-
14
tied to benefits under part A and enrolled
15
in part B in the coming calendar year.
16
"(3) ADDITIONAL AMOUNTS FOR CERTAIN INDI-
17
VIDUALS.—
18
"(A) LOW-COST PLANS.—The Secretary
19
shall pay annually to an individual enrolled with
20
a private health care arrangement one-half of
21
the excess (if any) of—
22
"(i) the per capita amount under
23
paragraph (2), over
24
"(ii) the annual premium for the indi-
25
vidual's private health care arrangement
.8 1807 PCS
�81
1
(or in the case of a private health care ar-
2
rangement that is a catastrophic health in-
3
surance plan, the annual premium for such
4
plan and the annual deductible amount for
5
such plan).
6
"(B) LONG TERM CARE PLAN.—The S c
e-
7
retary shall pay annually to an individual who
8
has received payment under subparagraph (A)
9
and is enrolled with a long term care plan, an
10
additional payment equal to the amount re-
11
ceived by such individual under subparagraph
12
(A).
13
14
"(d) DEFINITIONS.—For purposes of this section:
"(1)
CATASTROPHIC
HEALTH
INSURANCE
15
PLAN.—The term 'catastrophic health insurance
16
plan' has the meaning given to such term by section
17
220(c)(2)(A) of the Internal Revenue Code of 1986.
18
"(2) LONG TERM CARE PLAN.—The term 'long
19
term care plan' means a plan which covers services
20
of the type identified in section 1931(e)(3).
21
"(3) MEDICAL SAVINGS ACCOUNT.—The term
22
'medical savings account' has the meaning given to
23
such term by section 220(d)(1) of the Internal Reve-
24
nue Code of 1986.
S 1807 PCS-
�82
1
"(4) PRIVATE HEALTH CARE ARRANGEMENT.—
2
The term 'private health care arrangement' means—
3
"(A) any arrangement which offers at least
4
the health care services described in section
5
1876(b)(2)(A), or
6
"(B) a catastrophic health insurance plan
7
in connection with a medical savings account.
8
"(e) SOURCE OP PAYMENT.—The payment to an in-
9 dividual under this section shall be made from the Federal
10 Hospital Insurance Trust Fund and the Federal Supple11 mentary Medical Insurance Trust Fund. The proportion
12 of the payment to be paid by each trust fund shall be de13 termined each year by the Secretary based on the relative
14 proportion of government expenditures that benefits from
15 each fund contribute to the per capita amount determined
16 under subsection (b)(2)(B)."
17
(b) EFFECTIVE DATE.—The amendment made by
18 subsection (a) shall apply to payments made on or after
19 October 1, 1994.
•S 1807 PCS
�83
1 TITLE
X—ENHANCED
EFFI2
CIENCY THROUGH PAPER3
WORK REDUCTION
4 SEC. 1001. FEDERAL PAPERWORK REDUCTION AND EFFI5
CIENCY REQUIREMENTS.
6
(a) I N GENERAL.—The Secretary of Health and
7 Human Services (hereafter referred to in this title as the
8 "Secretary") shall, in consultation with the Director of the
9 Office of Management and Budget, the Secretary of Veter10 ans Affairs, the Secretary of Defense, the Director of Per11 sonnel Management, and other appropriate Federal offi12 cials, adopt standards to reduce the administrative and
13 paperwork burdens of all Federal health care programs
14 by—
15
16
(1) 50 percent within the 2-year period following the date of the enactment of this Act, and
17
(2) an additional 50 percent reduction from the
18
balance specified in (1) over a subsequent 3-year pe-
19
riod,
20 for a total reduction of 75 percent over the 5-year period
21 following the date of the enactment of this Act.
22
(b) INITIAL REDUCTION.—In order to achieve a pa-
23 perwork reduction described in subsection (a)(1), the Sec24 retary, shall adopt standards for Federal health care pro25 grams relating to each of the following:
•S 1807 PCS
�84
1
(1) Data elements for use in paper and elec-
2
tronic claims processing under health insurance
3
plans, as well as for use in utilization review and
4
management of care (including data fields, formats,
5
and medical nomenclature, and including plan bene-
6
fit
and insurance information).
7
(2) Uniform claims forms (including uniform
8
procedure and bill codes for use with such forms and
9
including information on other health insurance
10
plans that may be liable for benefits).
11
(3) Uniform electronic transmission of the data
12
elements (for purposes of billing and utilization re-
13
view).
14 Standards under paragraph (3) relating to electronic
15 transmission of data elements for claims for services shall
16 supersede (to the extent specified in such standards) the
17 standards adopted under paragraph (2) relating to the
18 submission of paper claims for such services. Standards
19 under paragraph (3) shall include protections to assure
20 the confidentiality of patient-specific information and to
21 protect against the unauthorized use and disclosure of in22 formation.
23
(c) SUBSEQUENT REDUCTION.—In order to achieve
24 a further paperwork reduction described in subsection
25 (a)(2), the Secretary shall modify by regulation the stand-
•8 1807 PCS
�85
1 ards adopted under subsection (b). The modification of the
2 standards may include such recommendations as reported
3 by the Standardized Form Commission in section 1003,
4 or any other provisions necessary to meet the goals for
5 reduction in the paperwork burden of Federal health care
6 programs.
7
(d) DEFINITION.—For purposes of this section, the
8 term "Federal health care program" means all Federal
9 programs related to health care, including programs de10 scribed in—
11
12
(1) title XVIII or XIX of the Social Security
Act,
13
(2) the Public Health Service Act,
14
(3) chapter 55 of title 10, United States Code,
15
(4) chapter 17 of title 38, United States Code,
16
(5) chapter 89 of title 5, United States Code,
17
18
19
or
(6) the Indian Health Care Improvement Act.
SEC. 1002. STATE PAPERWORK REDUCTION AND EFFI-
20
21
CIENCY REQUIREMENTS.
(a) I N GENERAL.—In order to be eligible for Federal
22 funds in connection with any State-administered health
23 care program, each State shall standardize the processing
24 of paper and electronic claims to reduce the administrative
25 and paperwork burdens on such programs by 75 percent
.8 1807 PCS
�86
1 during the 5-year period following the date of the enact2 ment of this Act.
3
(b) ENFORCEMENT.—
4
(1) INTERIM EVALUATION.—If at the end of the
5
4-year period following the date of the enactment of
6
this Act the Secretary determines that a State has
7
not achieved substantial progress toward the reduc-
8
tions required under subsection (a), the Secretary
9
shall notify such State regarding the proportion of
10
required reductions achieved and the further reduc-
11
tion necessary to achieve compliance with subsection
12
(a).
13
(2) FINAL COMPLIANCE.—If at the end of the
14
5-year period following the date of the enactment of
15
this Act the Secretary determines that a State has
16
not achieved the reductions required under sub-
17
section (a), the Secretary shall reduce Federal pay-
18
ments for health care programs administered by
19
such State by 10 percent. For each year that such
20
State fails to comply with the requirements of sub-
21
section (a), Federal payments for health care pro-
22
grams administered by the State shall be reduced by
23
an additional 10 percent.
24
(3) WAIVERS OF PAYMENT REDUCTIONS.—Any
25
State subject to a reduction in Federal payments
•S 1807 PCS
�87
1
under paragraph (2) may appeal to the Secretary for
2
a 1-year waiver of such reduction. In granting such
3
a waiver, the Secretary shall make a determination
4
of the good faith effort of such State to comply with
5
the requirements of subsection (a), taking into ac-
6
count the technical, practical, and financial capabili-
7
ties of the State in meeting such requirements.
8 SEC. 1003. STANDARDIZED FORMS COMMISSION.
9
10
(a) I N GENERAL.—
(1) ESTABLISHMENT.—Not
later than 12
11
months after the date of the enactment of this Act,
12
the Secretary shall establish a Standardized Forms
13
Commission (hereafter referred to in this section as
14
the "Commission") which shall make recommenda-
15
tions on the standardization of paper and electronic
16
claims processing so as to reduce the paperwork bur-
17
den associated with, and enhance the efficiency and
18
productivity of, such claims processing.
19
(2) MEMBERSHIP.—
20
(A) I N GENERAL.—The Commission shall
21
be composed of at least 12 but not more than
22
20 representatives of private health care provid-
23
ers and private insurers.
24
25
(B) CHAIR.—The Secretaiy shall appoint a
Chair of the Commission.
•S 1807 PCS
�88
1
(3) REPORT ON FINDINGS AND RECOMMENDA-
2
TIONS.—Not later than 24 months after the date of
3
the enactment of this Act, the Chair of the Commis-
4
sion shall report to the Secretary on the findings
5
and recommendations of the Commission.
6
(4)
PROHIBITION OF COMPENSATION.—Mem-
7
bers of the Commission shall serve without pay ex-
8
cept for reimbursement for travel expenses, includ-
9
ing per diem in lieu of subsistence, in accordance
10
with sections 5702 and 5703 of title 5, United
11
States Code.
12
(5) STAFF OF FEDERAL AGENCIES.—Upon re-
13
quest of the Chair, the head of any Federal depart-
14
ment or agency shall detail any of the personnel of
15
that department or agency to the Commission to as-
16
sist it in carrying out its duties under this section.
17
(6) OBTAINING
OFFICIAL
DATA.—The Commis-
18
sion may secure directly from any department or
19
agency of the United States information necessary
20
to enable it to carry out this section.
21
(7)
ADMINISTRATIVE
SUPPORT SERVICES.—
22
Upon request of the Chair, the Administrator of
23
General Services shall provide to the Commission the
24
administrative support services necessary for the
.8 1807 PCS
�89
1
Commission to carry out its responsibilities under
2
this section.
3
(b) LEGISLATIVE PROPOSAL.—
4
(1) I N GENERAL.—
5
(A)
DEVELOPMENT
OF
IMPLEMENTING
6
BILL.—Not later than 3 months after the Com-
7
mission has submitted its findings and rec-
8
ommendations to the Secretary, the Secretary
9
shall take such recommendations and submit
10
them to Congress in the form of an implement-
11
ing bill which contains the provisions necessary
12
or appropriate to implement the recommenda-
13
tions by either repealing or amending existing
14
laws or providing new statutory authority.
15
(B)
CONSIDERATION
OF
IMPLEMENTING
16
BILL.—The implementing bill described in sub-
17
paragraph (A) shall be considered by Congress
18
under
19
scribed in paragraph (2).
20
(2) CONGRESSIONAL CONSIDERATION.—
21
the procedures for consideration de-
(A)
R U L E S OF HOUSE OF REPRESENTA-
22
TIVES A N D SENATE.—This
23
paragraph is
en-
acted by Congress—
24
(i) as an exercise of the rulemaking
25
power of the House of Representatives and
•S 1807 PCS
�90
1
the Senate, respectively, and as such is
2
deemed a part of the rules of each House,
3
respectively, but applicable only with re-
4
spect to the procedure to be followed in
5
that House in the case of an implementing
6
bill described in paragraph (1)(A), and su-
7
persedes other rules only to the extent that
8
such rules are inconsistent therewith; and
9
(ii) with full recognition of the con-
10
stitutional right of either House to change
11
the rules (so far as relating to the proce-
12
dure of that House) at any time, in the
13
same manner and to the same extent as in
14
the case of any other rule of that House.
15
(B) INTRODUCTION AND REFERRAL.—On
16
the day on which the implementing bill de-
17
scribed in paragraph (1)(A) is transmitted to
18
the House of Representatives and the Senate,
19
such bill shall be introduced (by request) in the
20
House of Representatives by the Majority Lead-
21
er of the House, for himself and the Minority
22
Leader of the House, or by Members of the
23
House designated by the Majority Leader and
24
Minority Leader of the House and shall be in-
25
troduced (by request) in the Senate by the Ma-
.8 1807 PCS
�91
1
jority Leader of the Senate, for himself and the
2
Minority Leader of the Senate, or by Members
3
of the Senate designated by the Majority Lead-
4
er and Minority Leader of the Senate. I f either
5
House is not in session on the day on which the
6
implementing bill is transmitted, the bill shall
7
be introduced in the House, as provided in the
8
preceding sentence, on the first day thereafter
9
on which the House is in session. The imple-
10
menting bill introduced in the House of Rep-
11
resentatives and the Senate shall be referred to
12
the appropriate committees of each House.
13
(C)
AMENDMENTS
PROHIBITED.—No
14
amendment to an implementing bill shall be in
15
order in either the House of Representatives or
16
the Senate and no motion to suspend the appli-
17
cation of this paragraph shall be in order in ei-
18
ther House, nor shall it be in order in either
19
House for the Presiding Officer to entertain a
20
request to suspend the application of this para-
21
graph by unanimous consent.
22
23
(D) PERIOD FOR COMMITTEE A N D FLOOR
CONSIDERATION.—
24
(i) I N GENERAL.—Except
25
as provided
in clause .(ii), if the committee or commit-
•S 1807 PCS
�92
1
tees of either House to which an imple-
2
menting bill has been referred have not re-
3
ported it at the close of the 45th day after
4
its introduction, such committee or com-
5
mittees shall be automatically discharged
6
from further consideration of the imple-
7
menting bill and it shall be placed on the
8
appropriate calendar. A vote on final pas-
9
sage of the implementing bill shall be
10
taken in each House on or before the close
11
of the 45th day after the implementing bill
12
is reported by the committees or committee
13
of that House to which it was referred, or
14
after such committee or committees have
15
been discharged from further consideration
16
of the implementing bill. I f prior to the
17
passage by 1 House of an implementing
18
bill of that House, that House receives the
19
same implementing bill from the other
20
House then—
21
(I) the procedure in that House
22
shall be the same as if no implement-
23
ing bill had been received from the
24
other House; but
•8 1807 PCS
�93
1
(II) the vote on final passage
2
shall be on the implementing bill of
3
the other House.
4
(ii)
COMPUTATION
OF DAYS.—For
5
purposes of clause (i), in computing a
6
number of days in either House, there
7
shall be excluded—
8
(I) the days on which either
9
House is not in session because of an
10
adjournment of more than 3 days to
11
a day certain, or an adjournment of
12
the Congress sine die, and
13
(II) any Saturday and Sunday
14
not excluded under subclause (I) when
15
either House is not in session.
16
17
(E)
FLOOR
CONSIDERATION
I N THE
HOUSE OF REPRESENTATIVES.—
18
(i) MOTION TO PROCEED.—A motion
19
in the House of Representatives to proceed
20
to the consideration of an implementing
21
bill shall be highly privileged and not de-
22
batable. An amendment to the motion shall
23
not be in order, nor shall it be in order to
24
move to reconsider the vote by which the
25
motion is agreed to or disagreed to.
•S 1807 PCS
�94
1
(ii) DEBATE.—Debate in the House of
2
Representatives on an implementing bill
3
shall be limited to not more than 20 hours,
4
which shall be divided equally between
5
those favoring and those opposing the bill.
6
A motion further to limit debate shall not
7
be debatable. It shall not be in order to
8
move to recommit an implementing bill or
9
to move to reconsider the vote by which an
10
implementing bill is agreed to or disagreed
11
to.
12
(iii) MOTION TO POSTPONE.—Motions
13
to postpone, made in the House of Rep-
14
resentatives with respect to the consider-
15
ation of an implementing bill, and motions
16
to proceed to the consideration of other
17
business, shall be decided without debate.
18
(iv) APPEALS.—All appeals from the
19
decisions of the Chair relating to the appli-
20
cation of the Rules of the House of Rep-
21
resentatives to the procedure relating to an
22
implementing bill shall be decided without
23
debate.
24
(v) GENERAL RULES APPLY—Except
25
to the extent specifically provided in the
•S 1807 PCS
�95
1
preceding provisions of this subparagraph,
2
consideration of an implementing bill shall
3
be governed by the Rules of the House of
4
Representatives applicable to other bills
5
and resolutions in similar circumstances.
6
(F) FLOOR CONSIDERATION I N THE SEN-
7
ATE.—
8
(i) MOTION TO PROCEED.—A motion in
9
the Senate to proceed to the consideration
10
of an implementing bill shall be privileged
11
and not debatable. An amendment to the
12
motion shall not be in order, nor shall it be
13
in order to move to reconsider the vote by
14
which the motion is agreed to or disagreed
15
to.
16
(ii)
GENERAL
DEBATE.—Debate
in
17
the Senate on an implementing bill, and all
18
debatable motions and appeals in connec-
19
tion therewith, shall be limited to not more
20
than 20 hours. The time shall be equally
21
divided between, and controlled by, the
22
Majority Leader and the Minority Leader
23
or their designees.
24
(iii) DEBATE OP MOTIONS AND AP-
25
PEALS.—Debate in the Senate on any de-
•S 1807 PCS
�96
1
batable motion or appeal in connection
2
with an implementing bill shall be limited
3
to not more than 1 hour, to be equally di-
4
vided between, and controlled by, the
5
mover and the manager of the implement-
6
ing bill, except that in the event the man-
7
ager of the implementing bill is in favor of
8
any such motion or appeal, the time in op-
9
position thereto, shall be controlled by the
10
Minority Leader or his designee. Such
11
leaders, or either of them, may, from time
12
under their control on the passage of an
13
implementing bill, allot additional time to
14
any Senator during the consideration of
15
any debatable motion or appeal.
16
(iv) OTHER MOTIONS.—A motion in
17
the Senate to further limit debate is not
18
debatable. A motion to recommit an imple-
19
menting bill is not in order.
20
(c) FAILURE TO COMPLY W I T H RECOMMENDATIONS
21 ENACTED.—A health care provider or health care insurer
22 that fails to comply with any recommendations of the
23 Commission that are enacted in accordance with sub24 section (b) and that are applicable to such provider or in25 surer shall be ineligible for payments of claims submitted
•S 1807 PCS
�98
1
(2) NEGOTIATED LIABILITY—The provisions of
2
this title shall preempt any Federal, State or local
3
law to the extent that such law prohibits a health
4
care provider and a purchaser of health care from
5
voluntarily entering into a contractual agreement in
6
which the provider offers reduced fees for medical
7
services in exchange for a prearranged limit on the
8
amount of any award in a medical malpractice liabil-
9
ity action resulting from the provision of such serv-
10
ices or a limit on the cause of action that may be
11
maintained with respect to such services.
12
(c) EFFECT ON SOVEREIGN IMMUNITY AND CHOICE
13 OF LAW O VENUE.—Nothing in subsection (b) shall be
R
14 constmed to—
15
(1) waive or affect any defense of sovereign im-
16
munity asserted by any State under any provision of
17
law;
18
19
20
21
(2) waive or affect any defense of sovereign immunity asserted by the United States;
(3) affect the applicability of any provision of
the Foreign Sovereign Immunities Act of 1976;
22
(4) preempt State choice-of-law rules with re-
23
spect to claims brought by a foreign nation or a citi-
24
zen of a foreign nation; or
•S 1807 PCS
�97
1 under any provision of the Social Security Act or the Pub2 lie Health Service Act.
3
4
5
6
T I T L E XI—MEANINGFUL
MEDICAL LIABILITY REFORM
SEC. 1101. APPLICABILITY AND PREEMPTION.
(a) APPLICABILITY.—This title shall apply with re-
7 spect to any medical malpractice liability claim and to any
8 medical malpractice liability action brought in any State
9 or Federal court, except that this title shall not apply to
10 a claim or action for damages arising from a vaccine-relat11 ed injury or death to the extent that title X X I of the Pub12 lie Health Service Act applies to the claim or action.
13
(b) PREEMPTION.—
14
(1) I N GENERAL.—The provisions of this title
15
shall preempt any State or local law to the extent
16
such law is inconsistent with the limitations con-
17
tained in such provisions. The provisions of this title
18
shall not preempt any State law that provides for
19
defenses or places limitations on a person's liability
20
in addition to those contained in this title, places
21
greater limitations on the amount of attorneys' fees
22
and expenses that can be collected, or otherwise im-
23
poses greater restrictions than those provided in this
24
title.
S 1807 PCS-
�98
1
(2) NEGOTIATED LIABILITY.—The provisions of
2
this title shall preempt any Federal, State or local
3
law to the extent that such law prohibits a health
4
care provider and a purchaser of health care from
5
voluntarily entering into a contractual agreement in
6
which the provider offers reduced fees for medical
7
services in exchange for a prearranged limit on the
8
amount of any award in a medical malpractice liabil-
9
ity action resulting from the provision of such serv-
10
ices or a limit on the cause of action that may be
11
maintained with respect to such services.
12
(c) EFFECT ON SOVEREIGN IMMUNITY AND CHOICE
13 OF LAW OR VENUE.—Nothing in subsection (b) shall be
14 construed to—
15
(1) waive or affect any defense of sovereign im-
16
munity asserted by any State under any provision of
17
law;
18
19
20
21
(2) waive or affect any defense of sovereign immunity asserted by the United States;
(3) affect the applicability of any provision of
the Foreign Sovereign Immunities Act of 1976;
22
(4) preempt State choice-of-law rules with re-
23
spect to claims brought by a foreign nation or a citi-
24
zen of a foreign nation; or
•S 1807 PCS
�99
1
(5) affect the right of any court to transfer
2
venue or to apply the law of a foreign nation or to
3
dismiss a claim of a foreign nation or of a citizen
4
of a foreign nation on the ground of inconvenient
5
forum.
6
(d) FEDERAL COURT JURISDICTION NOT ESTAB-
7 LISHED ON FEDERAL QUESTION GROUNDS.—Nothing in
8 this title shall be construed to establish any jurisdiction
9 in the district courts of the United States over medical
10 malpractice liability actions on the basis of section 1331
11 or 1337 of title 28, United States Code.
12 SEC. 1102. STATUTE OF LIMITATIONS.
13
(a) I N GENERAL.—Except as provided in subsection
14 (b), no medical malpractice liability action shall be initi15 ated after the expiration of the 2-year period that begins
16 on the later of the date that the alleged iiyury that is the
17 subject of the claim was discovered, or the date on which
18 such injury should reasonably have been discovered. In no
19 event shall any such action be initiated after the expiration
20 of the 4-year period that begins on the date on which the
21 alleged injury occurred.
22
(b) EXCEPTION FOR CERTAIN MINORS.—In the case
23 of an alleged iryury suffered by a minor who has not at24 tained 6 years of age, no medical malpractice liability ac25 tion shall be initiated after the expiration of the 2-year
•S 1807 PCS
�100
1 period that begins on the date on which the alleged iryury
2 was discovered, or the date on which such injury should
3 reasonably have been discovered. In no event shall any
4 such action be initiated after the expiration of the 4-year
5 period that begins on the date on which the alleged iiyury
6 occurred, or the date on which the minor attains 8 years
7 of age, whichever is later.
8 SEC. 1103. SCOPE OF LIABILITY.
9
(a) I N GENERAL.—With respect to economic and
10 noneconomic damages, the liability of each defendant in
11 a medical malpractice liability action shall be several only
12 and may not be joint. Such a defendant shall be liable
13 only for the amount of economic or noneconomic damages
14 allocated to the defendant in direct proportion to such de15 fendant's percentage of fault or responsibility for the in16 jury suffered by the claimant.
17
(b) DETERMINATION OF PERCENTAGE OF L I A B I L -
18 ITY.—The trier of fact in a medical malpractice liability
19 action shall determine the extent of each defendant's fault
20 or responsibility for the economic or noneconomic damages
21 suffered by the claimant, and shall assign a percentage
22 of responsibility for such injury to each such defendant.
•S 1807 PCS
�101
1 SEC. 1104. DISCOVERY; FAILURE TO MAKE OR COOPERATE
2
3
IN DISCOVERY.
(a) I N GENERAL.—All requests for discovery pursu-
4 ant to a medical malpractice liability action shall identify
5 the relevant portion of the complaint, answer or other
6 pleading to which responses to the discovery requests are
7 expected to relate.
8
(b) FEES AND EXPENSES.—With respect to any mo-
9 tion for an order compelling discovery that is made pursu10 ant to a medical malpractice liability action, the court
11 shall award the prevailing party reasonable fees and other
12 expenses incurred by that party in bringing or defending
13 against the motion, including reasonable attorney fees, un14 less the court finds that the position of the unsuccessful
15 party was substantially justified or that special cir16 cumstances make such an award uryust.
17 SEC 1105. LIMITATION ON NONECONOMIC DAMAGES.
18
The total amount of noneconomic damages that may
19 be awarded to a claimant and the members of the claim20 ant's family for losses resulting from the iryury which is
21 the subject of a medical malpractice liability action may
22 not exceed $250,000, regardless of the number of parties
23 against whom the action is brought or the number of ac24 tions brought with respect to such injury.
•S 1807 PCS
�102
1 SEC. 1106. TREATMENT OF PAYMENTS FOR FUTURE ECO2
3
NOMIC LOSSES.
(a) PROHIBITING SINGLE LUMP-SUM PAYMENT.—In
4 any medical malpractice liability action in which the dam5 ages awarded for any economic losses to be incurred after
6 the date on which the judgment is entered exceeds
7 $100,000, a defendant may not be required to pay such
8 damages in a single, lump-sum payment, but shall be per9 mitted to make such payments periodically based on pro10 jections of the amount of damages expected to be incurred
11 by the claimant at appropriate intervals, as determined by
12 the court.
13
(b) USE OP ANNUITIES OR TRUSTS.—The court may
14 require that a defendant in a medical malpractice liability
15 action purchase an annuity or fund a reversionary trust
16 to make periodic payments under subsection as provided
17 for in subsection (a) if the court determines that a reason18 able basis exists for concluding that the defendant may
19 be unable or otherwise fail to make the required periodic
20 payments.
21
(c) REQUIREMENT OP PERIODIC PAYMENT AS PINAL
22 ORDER.—A judgment of a court awarding periodic pay23 ments under this section may not be reopened at any time
24 to contest, amend, or modify the schedule or amount of
25 the payments in the absence of fraud or any other basis
•S 1807 pes
�103
1 under which a party may obtain relief from a final judg2 ment.
3 SEC. 1107. TREATMENT OF COSTS AND ATTORNEY'S FEES.
4
(a) COSTS AND F E E S , G E N E R A L L Y . —
5
(1) COURT DISCRETION.—A court in a medical
6
malpractice liability action may, as a condition of
7
the initiation of such an action, require an undertak-
8
ing for the payment of the costs associated with
9
such action, including reasonable attorneys' fees.
10
(2) PAYMENT OP COSTS.—If a judgment in a
11
medical malpractice
liability action
is
rendered
12
against a party to such action, upon a motion by the
13
prevailing party to such action, the court shall re-
14
quire the party against whom the judgment was ren-
15
dered to pay to such prevailing party the costs and
16
fees incurred by such prevailing party under the ac-
17
tion, including reasonable attorneys' fees and other
18
expenses. The court may waive the application of
19
this paragraph if the court finds that the position
20
maintained by the party against whom such judg-
21
ment was rendered under such action was substan-
22
tially justified or that special circumstances make
23
such an award uiyust.
24
(3) APPLICATION FOR RECOVERY OF COSTS.—
25
A party to a medical malpractice liability action who
•8 1807 PCS
�104
1
is seeking an award of costs and fees as provided for
2
in paragraph (2) shall, not later than 30 days after
3
the date on which the final, nonappealable judgment
4
in entered with respect to such action, submit to the
5
appropriate court an application for the recovery of
6
costs and fees. Such application shall contain—
7
(A) a certification that the submitting
8
party is a prevailing party and is eligible to re-
9
ceive costs and fees under paragraph (2);
10
(B) a description of the amount of costs
11
and fees sought, including an itemized state-
12
ment from any attorney or expert witness rep-
13
resenting or appearing on behalf of such party
14
stating the actual time expended and the rate
15
at which fees and other expenses were com-
16
puted; and
17
(C) a description of the reasons why the
18
position of the party against whom the judg-
19
ment was rendered was not substantially justi-
20
fied.
21
In determining whether or not the position of the
22
nonprevailing party was substantially justified the
23
court shall consider only the record presented in the
24
action maintained for the costs and fees.
•S 1807 PCS
�105
1
(4) AMOUNT OF AWARD.—In making a decision
2
on an application submitted under paragraph (3),
3
the court may—
4
(A) assess the amount to be awarded
5
under this subsection against the party against
6
whom the judgment was rendered or against
7
the attorney (or attorneys) of such party; and
8
(B) reduce the amount to be awarded pur-
9
suant to this subsection, or deny an award, to
10
the extent that the prevailing party, during the
11
course of the proceedings, engaged in conduct
12
which unnecessarily and unreasonably length-
13
ened the time for, or increased the costs of, the
14
final
15
(b) ATTORNEY'S F E E S . —
16
resolution of the matter in controversy.
(1)
CONTINGENCY
FEES.—An
attorney
who
17
represents, on a contingency fee basis, a claimant in
18
a medical malpractice liability claim may not charge,
19
demand, receive, or collect for services rendered in
20
connection with such claim in excess of the following
21
amount recovered by judgment or settlement under
22
such claim:
23
24
(A) 25 percent of the first $150,000 (or
portion thereof) recovered; plus
•S 1807 PCS
�106
1
(B) 15 percent of any amount in excess of
2
$150,000 recovered.
3
(2) RECORDS.—
4
(A) I N GENERAL.—With respect to a medi-
5
cal malpractice liability action, in order to re-
6
ceive an award of attorneys' fees as provided
7
for in this title, the attorney of record of a
8
party to such action shall have maintained ac-
9
curate, complete records of hours worked on the
10
action regardless of the fee arrangement en-
11
tered into by the attorney with such party, in-
12
eluding records of other attorneys, legal staff,
13
expert witnesses and others who worked on the
14
action on behalf of such attorney.
15
(B) CALCULATION.—The court shall deter-
16
mine the amount of reasonable attorneys' fees
17
and expenses that shall be awarded in a medical
18
malpractice liability action under this title on
19
the basis of an hourly rate or as a percentage
20
of the total damages awarded under such action
21
for economic and noneconomic losses. Such
22
amount shall be indexed to account for infla-
23
tion. The amount of attorneys' fees and ex-
24
penses as determined by the court may not ex-
•S 1807 PCS
�107
1
ceed an amount that would be considered rea-
2
sonable based on the following:
3
(i) The time, labor, and skill nec-
4
essary to properly perform the legal serv-
5
ices required by the action.
6
(ii) The novelty and difficultly of the
7
questions involved in the action.
8
(iii) The likelihood, if apparent to the
9
client, that the acceptance of employment
10
with respect to the client's action will pre-
11
elude other employment by the attorney.
12
(iv) The fee customarily charged in
13
the locality for similar legal services.
14
(v) The amount involved in the action
15
and the results obtained.
16
(vi) The time limitations imposed by
17
the client or by the circumstances of the
18
action.
19
(vii) The nature and length of the
20
professional relationship between the attor-
21
ney and the client.
22
(viii) The experience, reputation, and
23
ability of the attorney performing the serv-
24
ices in connection with the action.
•S 1807 PCS
�108
1 SEC. 1108. CONTRIBUTION AND INDEMNIFICATION.
2
(a) RECOVERY.—With respect to a medical mal-
3 practice liability action, each nonsettling party may re4 cover contribution and indemnification from any other
5 such nonsettling party who, if joined in the original action,
6 would have been liable for such damages.
7
(b) RELEASE, DISMISSAL, SETTLEMENT.—A party
8 who is released or dismissed (with or without prejudice)
9 from, or who, in good faith prior to a verdict or judgment,
10 settles a medical malpractice liability action shall, upon
11 the execution of the release, dismissal or settlement agree12 ment, be discharged from all claims for contribution or
13 indemnification brought by nonsettling or other settling
14 parties to such action. Any party to such action who as15 serts a lack of good faith shall have the burden of proof
16 concerning such good faith issue.
17 SEC. 1109. COLLATERAL SOURCES.
18
(a) I N GENERAL.—The total amount of damages re-
19 ceived by a claimant in a medical malpractice liability ac20 tion shall be reduced, in accordance with subsection (b),
21 by any other payment that has been made, or that will
22 be made, to such claimant to compensate such claimant
23 for an ii\jury that was part of such action, including
24 payments—
25
26
(1) under Federal or State disability or sickness
programs;
•S 1807 PCS
�109
1
2
(2) under Federal, State, or private health insurance programs;
3
(3) under private disability insurance programs;
4
(4) under employer wage continuation pro-
5
grams; and
6
(5) from any other source that are intended to
7
compensate such claimant for such iryury.
8
(b) AMOUNT OP REDUCTION.—The amount by which
9 an award of damages to a claimant for an injury shall
10 be reduced under subsection (a) shall be—
11
(1) the total amount of any payments (other
12
than such award) that have been made, or that will
13
be made, to such claimant to compensate such
14
claimant for such iryury; and
15
(2) the amount paid by such claimant (or by
16
the spouse, parent, or legal guardian of such claim-
17
ant) to secure the payments described in paragraph
18
(1).
19 SEC. 1110. DAMAGES RELATING TO MEDICAL PRODUCT LI20
21
ABILITY CLAIMS.
(a) I N GENERAL.—Noneconomic damages may not
22 be awarded with respect to any medical product liability
23 claim alleged against a medical product producer if—
24
25
(1) the drug or device that is the subject of
such claim—
•S 1807 PCS
�110
1
(A) was subject to approval under section
2
505, or premarket approval under section 515,
3
of the Federal Food, Drug, and Cosmetic Act
4
by the Food and Drug Administration with re-
5
spect to—
6
(i) the safety of the formulation or
7
performance of the aspect of the drug or
8
device; or
9
(ii) the adequacy of the packaging or
10
labeling of the drug or device, and
11
(B) was approved by the Food and Drug
12
Administration; or
13
(2) the drug or device is generally recognized as
14
safe and effective pursuant to conditions established
15
by the Food and Drug Administration and applica-
16
ble regulations, including packaging and labeling
17
regulations.
18
(b) EXCEPTION I N CASE OP W I T H H E L D INPORMA-
19
TION, MISREPRESENTATION, OR I L L E G A L
PAYMENT.—
20 The provisions of subsection (a) shall not apply i f it is
21 determined on the basis of clear and convincing evidence
22 that the medical product producer—
23
(1) withheld from or misrepresented
to the
24
Food and Drug Administration information concern-
25
ing such drug or device that is required to be sub-
•S 1807 PCS
�Ill
1
mitted under the Federal Food, Drug, and Cosmetic
2
Act or section 352 of the Public Health Service Act
3
and that is material and relevant to the action in-
4
volved; or
5
(2) made an illegal payment to an official of the
6
Food and Drug Administration for the purpose of
7
securing approval of the drug or device.
8
(c) DEFINITION.—As used in this section, the term
9 "clear and convincing evidence" is that measure or degree
10 of proof that will produce in the mind of the trier of fact
11 a firm belief or conviction as to the truth of the allegations
12 sought to be established, except that such measure or de13 gree of proof is more than that required under preponder14 ance of the evidence, but less than that required for proof
15 beyond a reasonable doubt.
16 SEC. 1111. CLASS ACTIONS.
17
(a) RECOVERY BY NAMED CLAIMANTS I N CLASS AC-
18 TIONS.—In any medical malpractice liability action that
19 is certified as a class action pursuant to Rule 23 of the
20 Federal Rules of Civil Procedure, the share of damages
21 under any final judgment or any settlement that is award22 ed to any party serving as a representative claimant shall
23 be calculated in the same manner as the shares of the
24 final judgment or settlement awarded to all other members
25 of the claimant class. The preceding sentence may not be
•8 1807 PCS
�112
1 constmed to limit the award to a representative claimant
2 of reasonable compensation, costs, and expenses relating
3 to the representation of the class.
4
(b) PROHIBITION OF CONFLICTS OF INTEREST.—In
5 any medical malpractice liability action that is certified as
6 a class action pursuant to Rule 23 of the Federal Rules
7 of Civil Procedure, if a party is represented by any attor8 ney who has a beneficial interest in the subject of the liti9 gation, the court shall make a determination of whether
10 such interest constitutes a conflict of interest sufficient to
11 disqualify the attorney from representing the party.
12
(c) RECEIPT OF REFERRAL FEES.—In any medical
13 liability action that is certified as a class action pursuant
14 to Rule 23 of the Federal Rules of Civil Procedure, an
15 attorney may not represent the class if the attorney has
16 paid or is obligated to pay a fee to a third party who as17 sisted the attorney in obtaining the representation of any
18 party to the action. An attorney who knowingly violates
19 this subsection shall be barred from representing the party
20 in such action or any action to which this title applies.
21
SEC. 1112. DEFINITIONS.
22
(1) CLAIMANT.—The term "claimant" means
23
any person who alleges a medical malpractice liabil-
24
ity claim, and any person on whose behalf such a
25
claim is alleged, including the decedent in the case
•S 1807 PCS
�113
1
of an action brought through or on behalf of an es-
2
tate.
3
(2) COMMERCIAL LOSS.—The term "commercial
4
loss" means loss, including damage to the product
5
itself, which is not harm described in subparagraph
6
(A) or (B) of paragraph (5), and which is of a kind
7
for which there is a remedy under applicable con-
8
tract or commercial law.
9
(3) ECONOMIC DAMAGES.—The term "economic
10
damages" means damages paid to compensate an in-
11
dividual for hospital and other medical expenses, lost
12
wages, lost employment, and other pecuniary losses.
13
(4) HEALTH CARE PROFESSIONAL.—The term
14
"health care professional" means any individual who
15
provides health care services in a State and who is
16
required by the laws or regulations of the State to
17
be licensed or certified by the State to provide such
18
services in the State.
19
(5) HARM.—The term "harm" means—
20
21
(A) the personal physical illness, injury, or
death of a claimant;
22
(B) the mental anguish or emotional harm
23
of a claimant that is caused by or causing the
24
claimant personal physical illness or ii\jury; or
S 1807 PCS
8
�114
1
(C) the physical damage caused by a medi-
2
cal product to property other than the medical
3
product itself.
4
Such term does not include commercial loss or loss
5
or damage to a medical product.
6
(6) HEALTH
CARE
PROVIDER.—The
term
7
"health care provider" means any organization or
8
institution that is engaged in the delivery of health
9
care services in a State and that is required by the
10
laws or regulations of the State to be licensed or cer-
11
tified by the State to engage in the delivery of such
12
services in the State.
13
(7) INJURY.—The term "ir\jury" means any ill-
14
ness, disease, or other harm that is the subject of
15
a medical malpractice liability action or a medical
16
malpractice liability claim.
17
(8)
MEDICAL
MALPRACTICE
LIABILITY AC-
18
TION.—The term "medical malpractice liability ac-
19
tion" means a civil action brought in a State or Fed-
20
eral court against a health care provider or health
21
care professional in which the plaintiff alleges a
22
medical malpractice liability claim, but does not in-
23
elude any action in which the plaintiffs sole allega-
24
tion is an allegation of an intentional tort.
•8 1807 PCS
�115
1
(9)
MEDICAL
MALPRACTICE
LIABILITY
2
CLAIM.—The term "medical malpractice liability
3
claim" means a claim in which the claimant alleges
4
that iryury was caused by the provision of (or the
5
failure to provide) health care services or the use of
6
a medical product.
7
(10) MEDICAL PRODUCT.—
8
(A) I N GENERAL.—The term "medical
9
product" means, with respect to the allegation
10
of a claimant, a drug (as defined in section
11
201(g)(1) of the Federal Food, Drug, and Cos-
12
metic Act (21 U.S.C. 321(g)(1)) or a medical
13
device (as defined in section 201(h) of the Fed-
14
eral Food, Drug, and Cosmetic Act (21 U.S.C.
15
321(h)) if—
16
(i) such drug or device was subject to
17
premarket approval under section 505,
18
507, or 515 of the Federal Food, Drug,
19
and Cosmetic Act (21 U.S.C. 355, 357, or
20
360e) or section 351 of the Public Health
21
Service Act (42 U.S.C. 262) with respect
22
to the safety of the formulation or per-
23
formance of the aspect of such drug or de-
24
vice which is the subject of the claimant's
25
allegation or the adequacy of the packag-
•S 1807 PCS
�116
1
ing or labeling of such drug or device, and
2
such drug or device is approved by the
3
Food and Drug Administration; or
4
(ii) the drug or device is generally rec-
5
ognized as safe and effective under regula-
6
tions issued by the Secretary of Health
7
and Human Services under section 201 (p)
8
of the Federal Food, Drug, and Cosmetic
9
Act (21 U.S.C. 321(p)).
10
(B) EXCEPTION I N CASE OF MISREPRE-
11
SENTATION OR FRAUD.—Notwithstanding sub-
12
paragraph (A), the term "medical product"
13
shall not include any product described in such
14
subparagraph if the claimant shows that the
15
product is approved by the Food and Drug Ad-
16
ministration for marketing as a result of with-
17
held information, misrepresentation, or an ille-
18
gal payment by manufacturer of the product.
19
(11)
NONECONOMIC
DAMAGES.—The
term
20
"noneconomic damages" means damages paid to
21
compensate an individual for losses for physical and
22
emotional pain, suffering, inconvenience, physical
23
impairment, mental anguish, emotional distress, dis-
24
25
figurement,
loss of enjoyment of life, loss of society
and companionship, loss of consortium, iryury to
•S 1807 PCS
�117
1
reputation, humiliation, and other noneconomic in-
2
jury.
3
(12) PERSON.—The term "person" means any
4
individual, corporation, company, association, firm,
5
partnership, society, joint stock company, or any
6
other entity, including any governmental entity.
7 SEC. 1113. SEVERABILITY.
8
If any provision of this title or the application of any
9 provision to any person or circumstance is held invalid,
10 the remainder of this title and the application of such pro11 visions to any other person or circumstance shall not be
12 affected by such invalidation.
13 SEC. 1114. EFFECTIVE DATE.
14
This title shall apply to all medical malpractice liabil-
15 ity actions commenced on or after the date of enactment
16 of this Act.
1
7
1
8
T I T L E XII—ANTITRUST
REFORMS
19 SEC. 1201. ESTABLISHMENT OF LIMITED EXEMPTION PRO20
21
GRAM FOR HEALTH CARE JOINT VENTURES.
(a) ESTABLISHMENT.—
22
(1) I N GENERAL.—Not later than 6 months
23
after the date of the enactment of this Act, the At-
24
torney General, after consultation with the Secretaiy
25
of Health and Human Services and the Interagency
•S 1807 PCS
�118
1
Advisory Committee on Competition, Antitrust Pol-
2
icy, and Health Care, shall promulgate specific
3
guidelines under which a health care joint venture
4
may submit an application requesting that the At-
5
torney General provide the entities participating in
6
the joint venture with an exemption under which
7
(notwithstanding any other provision of law)—
8
(A) monetary recovery on a claim under
9
the antitrust laws shall be limited to actual
10
damages if the claim results from conduct with-
11
in the scope of the joint venture that occurs
12
while the exemption is in effect; and
13
(B) the conduct of the entity in making or
14
performing a contract to carry out the joint
15
venture shall not be deemed illegal per se under
16
the antitrust laws but shall be judged on the
17
basis of its reasonableness, taking into account
18
all relevant factors affecting competition, in-
19
eluding (but not limited to) effects on competi-
20
tion in properly defined, relevant research, de-
21
velopment, product, process, and service mar-
22
kets (taking into consideration worldwide capac-
23
ity to the extent that it may be appropriate in
24
the circumstances).
•8 1807 PCS
�119
1
(2) DEADLINE FOR RESPONSE.—The Attorney
2
General, after consultation with the Secretary and
3
the Advisory Committee, shall approve or disapprove
4
the application of a health care joint venture for an
5
exemption under this subsection not later than 30
6
days after the Attorney General receives the joint
7
venture's application.
8
(3) PROVIDING REASONS FOR DISAPPROVAL.—
9
If the Attorney General disapproves the application
10
of a health care joint venture for an exemption
11
under this subsection, the Attorney General shall
12
provide the joint venture with a statement explaining
13
the reasons for the Attorney General's disapproval.
14
(b) REQUIREMENTS FOR APPROVAL.—For purposes
15 of subsection (a), the Attorney General shall approve the
16 application of a health care joint venture for an exemption
17 under subsection (a) if an entity participating in the joint
18 venture submits to the Attorney General an application
19 not later than 30 days after the entity has entered into
20 a written agreement to participate in the joint venture (or
21 not later than 30 days after the date of the enactment
22 of this Act in the case of a joint venture in effect as of
23 such date) that contains the following information and as24 surances:
•8 1807 PCS
�120
1
2
3
4
(1) The identities of the parties to the joint
venture.
(2) The nature, objectives, and planned activities of the joint venture.
5
(3) Assurances that the entities participating in
6
the joint venture shall notify the Attorney General
7
of any changes in the information described in para-
8
graphs (1) and (2) during the period for which the
9
exemption is in effect.
10
(c) REVOCATION OP E X E M P T I O N . —
11
(1) I N GENERAL.—The Attorney General, after
12
consultation with the Secretary, may revoke an ex-
13
emption provided to a health care joint venture
14
under this section if, at any time during which the
15
exemption is in effect, the Attorney General finds
16
that the joint venture no longer meets the applicable
17
requirements for approval under subsection (b), ex-
18
cept that the Attorney General may not revoke such
19
an exemption i f the failure of the health care joint
20
venture to meet such requirements is merely tech-
21
nical in nature.
22
(2) TIMING.—The revocation of an exemption
23
under paragraph (1) shall apply only to conduct of
24
the health care joint venture occurring after the ex-
25
emption is no longer in effect.
•8 1807 PCS
�121
1
(d) WITHDRAWAL
OP APPLICATION.—Any
party that
2 submits an application under this section may withdraw
3 such application at any time before the Attorney General's
4 response to the application.
5
(e) REQUIREMENTS R E L A T I N G TO NOTICE A N D P U B -
6
LIGATION
7
TION.—
8
9
OF EXEMPTIONS
AND RELATED
INFORMA-
(1) PUBLICATION OF APPROVED APPLICATIONS
FOR EXEMPTIONS IN FEDERAL REGISTER.—
10
(A) I N GENERAL.—With respect to each
11
exemption for a health care joint venture pro-
12
vided under subsection (a), the Attorney Gen-
13
eral (acting jointly with the Secretary) shall—
14
(i) prepare a notice with respect to
15
the joint venture that identifies the parties
16
to the venture and that describes the
17
planned activities of the venture;
18
(ii) submit the notice to the entities
19
participating in the joint venture; and
20
(iii) after submitting the notice to
21
such entities (but not later than 30 days
22
after approving the application for the ex-
23
emption for the joint venture), publish the
24
notice in the Federal Register.
•S 1807 PCS
�122
1
(B)
EFFECT OF PUBLICATION.—An
ex-
2
emption provided by the Attorney General
3
under subsection (a) shall take effect as of the
4
date of the publication in the Federal Register
5
of the notice with respect to the exemption pur-
6
suant to subparagraph (A).
7
(2) WAIVER OF DISCLOSURE REQUIREMENTS
8
FOR INFORMATION RELATING TO APPLICATIONS FOR
9
EXEMPTIONS.—
10
(A) I N GENERAL.—All information and
11
documentary material submitted as part of an
12
application of a health care joint venture for an
13
exemption under subsection (a), together with
14
any other information obtained by the Attorney
15
General, the Secretary, or the Advisory Com-
16
mittee in the course of any investigation, ad-
17
ministrative proceeding, or case with respect to
18
a potential violation of the antitrust laws by the
19
joint venture with respect to which the exemp-
20
tion applies, shall be exempt from disclosure
21
under section 552 of title 5, United States
22
Code, and shall not be made publicly available
23
by any agency of the United States to which
24
such section applies, except as relevant to a law
25
enforcement investigation or in a judicial or ad-
.8 1807 PCS
�123
1
ministrative proceeding in which such informa-
2
tion and material is subject to any protective
3
order.
4
(B)
EXCEPTION
FOR INFORMATION I N -
5
CLUDED IN FEDERAL REGISTER NOTICE.—Sub-
6
paragraph (A) shall not apply with respect to
7
information contained in a notice published in
8
the Federal Register pursuant to paragraph
9
(1).
10
11
(3) USE OF INFORMATION TO SUPPORT OR ANSWER CLAIMS UNDER ANTITRUST LAWS.—
12
(A) I N GENERAL.—Except as provided in
13
subparagraph (B), the fact of disclosure of con-
14
duct under an application for an exemption
15
under subsection (a) and the fact of publication
16
of a notice in the Federal Register under para-
17
graph (1) shall be admissible into evidence in
18
any judicial or administrative proceeding for the
19
sole purpose of establishing that a person is en-
20
titled to the protections provided by an exemp-
21
tion granted under subsection (a).
22
(B)
EFFECT
OF
REJECTED
APPLICA-
23
T I O N . — I f the Attorney General denies, in whole
24
or in part, an application for an exemption
25
under subsection (a), or revokes an exemption
•S 1807 PCS
�124
1
under such section, neither the negative deter-
2
mination nor the statement of reasons therefor
3
shall be admissible into evidence in any admin-
4
istrative or judicial proceeding for the purpose
5
of supporting or answering any claim under the
6
antitrust laws.
7 SEC. 1202. ISSUANCE OF HEALTH CARE CERTIFICATES OF
8
9
PUBLIC ADVANTAGE.
(a) ISSUANCE AND EFFECT OF CERTIFICATE.—The
10 Attorney General, after consultation with the Secretary
11 and the Advisory Committee, shall issue in accordance
12 with this section a certificate of public advantage to each
13 eligible health care joint venture that complies with the
14 requirements in effect under this section on or after the
15 expiration of the 1-year period that begins on the date
16 of the enactment of this Act (without regard to whether
17 or not the Attorney General has promulgated regulations
18 to carry out this section by such date). Such venture, and
19 the parties to such venture, shall not be liable under any
20 of the antitrust laws for conduct described in such certifi21 cate and engaged in by such venture if such conduct oc22 curs while such certificate is in effect.
23
24
(b) REQUIREMENTS APPLICABLE TO ISSUANCE OF
CERTIFICATES.—
•S 1807 PCS
�125
1
(1) STANDARDS TO BE MET.—The Attorney
2
General shall issue a certificate to an eligible health
3
care joint venture i f the Attorney General finds
4
that—
5
(A) the benefits that are likely to result
6
from carrying out the venture outweigh the re-
7
duction in competition (if any) that is likely to
8
result from the venture, and
9
(B) such reduction in competition is rea-
10
sonably necessary to obtain such benefits.
11
(2) FACTORS TO B E CONSIDERED.—
12
(A) W E I G H I N G OF BENEFITS AGAINST RE-
13
DUCTION I N COMPETITION.—For purposes of
14
making the finding described in paragraph
15
(1)(A), the Attorney General shall consider
16
whether the venture is likely —
17
(i) to maintain or to increase the
18
quality of health care,
19
(ii) to increase access to health care,
20
(iii) to achieve cost efficiencies that
21
will be passed on to health care consumers,
22
such as economies of scale, reduced trans-
23
action costs, and reduced administrative
24
costs,
S 1807 PCS-
�126
1
(iv) to preserve the operation of
2
health care facilities located in underserved
3
geographical areas,
4
(v) to improve utilization of health
5
care resources, and
6
(vi) to reduce inefficient health care
7
resource duplication.
8
(B) NECESSITY OP REDUCTION I N COM-
9
PETITION.—For purposes of making the finding
10
described in paragraph (1)(B), the Attorney
11
General shall consider—
12
(i) the ability of the providers of
13
health care services that are (or likely to
14
be) affected by the health care joint ven-
15
ture and the entities responsible for mak-
16
ing payments to such providers to nego-
17
tiate societally optimal payment and serv-
18
ice arrangements,
19
(ii) the effects of the health care joint
20
venture on premiums and other charges
21
imposed by the entities described in clause
22
(i), and
23
(iii) the availability of equally effi-
24
cient, less restrictive alternatives to achieve
•S 1807 PCS
�127
1
the benefits that are intended to be
2
achieved by carrying out the venture.
3
(c)
ESTABLISHMENT OP CRITERIA AND PROCE-
4 DURES.—Subject to subsections (d) and (e), not later than
5 1 year after the date of the enactment of this Act, the
6 Attorney General and the Secretary shall establish jointly
7 by rule the criteria and procedures applicable to the issu8 ance of certificates under subsection (a). The rules shall
9 specify the form and content of the application to be sub10 mitted to the Attorney General to request a certificate,
11 the information required to be submitted in support of
12 such application, the procedures applicable to denying and
13 to revoking a certificate, and the procedures applicable to
14 the administrative appeal (if such appeal is authorized by
15 rule) of the denial and the revocation of a certificate. Such
16 information may include the terms of the health care joint
17 venture (in the case of a venture in existence as of the
18 time of the application) and implementation plan for the
19 joint venture.
20
(d) ELIGIBLE HEALTH CARE JOINT VENTURE.—To
21 be an eligible health care joint venture for purposes of this
22 section, a health care joint venture shall submit to the At23 torney General an application that complies with the rules
24 in effect under subsection (c) and that includes—
•S 1807 PCS
�128
1
(1) an agreement by the parties to the venture
2
that the venture will not foreclose competition by en-
3
tering into contracts that prevent health care provid-
4
ers from providing health care in competition with
5
the venture,
6
(2) an agreement that the venture will submit
7
to the Attorney General annually a report that de-
8
scribes the operations of the venture and informa-
9
tion regarding the impact of the venture on health
10
care and on competition in health care, and
11
(3) an agreement that the parties to the ven-
12
ture will notify the Attorney General and the Sec-
13
retary of the termination of the venture not later
14
than 30 days after such termination occurs.
15
(e) REVIEW OP APPLICATIONS FOR CERTIFICATES.—
16 Not later than 30 days after an eligible health care joint
17 venture submits to the Attorney General an application
18 that complies with the rules in effect under subsection (c)
19 and with subsection (d), the Attorney General shall issue
20 or deny the issuance of such certificate. If, before the expi21 ration of such 30-day period, the Attorney General fails
22 to issue or deny the issuance of such certificate, the Attor23 ney General shall be deemed to have issued such certifi24
cate.
.8 1807 PCS
�129
1
(f) REVOCATION OP CERTIFICATE.—Whenever
the
2 Attorney General finds that a health care joint venture
3 with respect to which a certificate is in effect does not
4 meet the standards specified in subsection (b), the Attor5 ney General shall revoke such certificate.
6
7
(g) W R I T T E N REASONS; JUDICIAL R E V I E W . —
(1)
DENIAL
A N D REVOCATION
OF
CERTIFI-
8
GATES.—If the Attorney General denies an applica-
9
tion for a certificate or revokes a certificate, the At-
10
torney General shall include in the notice of denial
11
or revocation a statement of the reasons relied upon
12
for the denial or revocation of such certificate.
13
(2) JUDICIAL REVIEW.—
14
(A)
AFTER
ADMINISTRATIVE
PROCEED-
15
ING.—(i) I f the Attorney General denies an ap-
16
plication submitted or revokes a certificate is-
17
sued under this section after an opportunity for
18
hearing on the record, then any party to the
19
health care joint venture involved may com-
20
mence a civil action, not later than 60 days
21
after receiving notice of the denial or revoca-
22
tion, in an appropriate district court of the
23
United States for review of the record of such
24
denial or revocation.
•S 1807 PCS
�130
1
(ii) As part of the Attorney General's an-
2
swer, the Attorney General shall file in such
3
court a certified copy of the record on which
4
such denial or revocation is based. The findings
5
of fact of the Attorney General may be set aside
6
only if found to be unsupported by substantial
7
evidence in such record taken as a whole.
8
(B) DENIAL OR REVOCATION WITHOUT AD-
9
MINISTRATIVE PROCEEDING.—If the Attorney
10
General denies an application submitted or re-
11
vokes a certificate issued under this section
12
without an opportunity for hearing on the
13
record, then any party to the health care joint
14
venture involved may commence a civil action,
15
not later than 60 days after receiving notice of
16
the denial or revocation, in an appropriate dis-
17
trict court of the United States for de novo re-
18
view of such denial or revocation.
19
(h) EXEMPTION.—A person shall not be liable under
20 any of the antitrust laws for conduct necessary—
21
(1) to prepare, agree to prepare, or attempt to
22
agree to prepare an application to request a certifi-
23
cate under this section, or
•S 1807 PCS
�131
1
(2) to attempt to enter into any health care
2
joint venture with respect to which such a certificate
3
is in effect.
4
SEC. 1203. INTERAGENCY ADVISORY COMMITTEE ON COM-
5
PETITION, ANTITRUST POLICY, AND HEALTH
6
CARE.
7
(a) ESTABLISHMENT.—There is hereby established
8 the Interagency Advisory Committee on Competition,
9 Antitrust Policy, and Health Care. The Advisory Commit10 tee shall be composed of—
11
12
(1) the Secretary of Health and Human Services (or the designee of the Secretary);
13
14
(2) the Attorney General (or the designee of the
Attorney General);
15
16
(3) the Director of the Office of Management
and Budget (or the designee of the Director); and
17
(4) a representative of the Federal Trade Com-
18
mission.
19
(b) DUTIES.—The duties of the Advisory Committee
20 are—
21
(1) to discuss and evaluate competition and
22
antitrust policy, and their implications with respect
23
to the performance of health care markets;
24
(2) to analyze the effectiveness of health care
25
joint ventures receiving exemptions under the pro's 1807 P S
C
�132
1
gram established under section 1201(a) or certifi-
2
cates under section 1202 in reducing the costs of
3
and expanding access to the health care services that
4
are the subject of such ventures; and
5
(3) to make such recommendations to Congress
6
not later than 2 years after the date of the enact-
7
ment of this Act (and at such subsequent periods as
8
the Advisory Committee considers appropriate) re-
9
garding modifications to the program established
10
under section 1201(a) or to section 1202 as the Ad-
11
visory Committee considers appropriate, including
12
modifications relating to the costs to health care
13
providers of obtaining an exemption for a joint ven-
14
ture under such program.
15 SEC. 1204. DEFINITIONS.
16
For purposes of this title:
17
(1) The term "Advisory Committee" means the
18
Interagency Advisory Committee on Competition,
19
Antitrust Policy, and Health Care established under
20
section 1203.
21
(2) The term "antitrust laws"—
22
(A) has the meaning given it in subsection
23
(a) of the first section of the Clayton Act (15
24
U.S.C. 12(a)), except that such term includes
25
section 5 of the Federal Trade Commission Act
•8 1807 PCS
�133
1
(15 U.S.C. 45) to the extent such section ap-
2
plies to unfair methods of competition; and
3
(B) includes any State law similar to the
4
laws referred to in subparagraph (A).
5
(3) The term "certificate" means a certificate
6
of public advantage authorized to be issued under
7
section 1202(a).
8
(4) The term "health care joint venture" means
9
an agreement (whether existing or proposed) be-
10
tween 2 or more providers of health care services
11
that is entered into solely for the purpose of sharing
12
in the provision of health care services and that in-
13
volves substantial integration or financial risk-shar-
14
ing between the parties, but does not include the ex-
15
changing of information, the entering into of any
16
agreement, or the engagement in any other conduct
17
that is not reasonably required to carry out such
18
agreement.
19
(5) The term "health care services" includes
20
services related to the delivery or administration of
21
health care services.
22
23
(6) The term "liable" means liable for any civil
or criminal violation of the antitrust laws.
24
(7) The term "provider of health care services"
25
means any individual or entity that is engaged in the
•S 1807 PCS
�134
1
delivery of health care services in a State and that
2
is required by State law or regulation to be licensed
3
or certified by the State to engage in the delivery of
4
such services in the State.
5 T I T L E XIII—EXPENDITURE TAR6
GETS FOR T H E MEDICAID
7
AND MEDICARE PROGRAMS
8 SEC. 1301. DETERMINATION OF EXPENDITURES UNDER
9
THE MEDICAID AND MEDICARE PROGRAMS.
10
(a) DETERMINATION OP EXCESS EXPENDITURES.—
11
(1) I N GENERAL.—Not later than 30 days after
12
the end of each fiscal year beginning with fiscal year
13
1995, the Director of the Office of Management and
14
Budget (hereafter referred to in this title as the
15
"Director"), in consultation with the Secretary, shall
16
determine the amount of medicaid excess expendi-
17
tures and medicare excess expenditures for such fis-
18
cal year.
19
(2) DEFINITIONS.—For purposes of this title—
20
(A) MEDICAID EXCESS EXPENDITURES.—
21
The term "medicaid excess expenditures" for a
22
fiscal
year means the amount by which the Fed-
23
eral expenditures under the medicaid program
24
for such fiscal year exceed the target expendi-
•S 1807 PCS
�135
1
ture for such program as determined under
2
subsection (b)(1) for such fiscal year.
3
(B) MEDICARE EXCESS EXPENDITURES.—
4
The term "medicare excess expenditures" for a
5
fiscal
year means the amount by which the ex-
6
penditures under the medicare program for
7
such fiscal year exceed the target expenditure
8
for such program as determined under sub-
9
section (b)(2) for such fiscal year.
10
(C)
MEDICAID
PROGRAM.—The
term
11
"medicaid program" means the program under
12
title XEX of the Social Security Act.
13
(D) MEDICARE
PROGRAM.—The
term
14
"medicare program" means the program under
15
title XVIII of the Social Security Act.
16
17
(b) TARGET EXPENDITURES.—
(1) MEDICAID PROGRAM.—
18
(A) I N GENERAL,.—The target expenditure
19
determined under this paragraph for the medic-
20
aid program for a fiscal year shall be an
21
amount equal to the applicable percentage of
22
the total Federal expenditures under the medic-
23
aid program for the previous fiscal year.
•S 1807 PCS
�136
1
(B)
MEDICAID
APPLICABLE
PERCENT-
2
AGE.—For purposes of subparagraph (A), the
3
medicaid applicable percentage is—
4
(i) 106.8 percent for the determina-
5
tion with respect to fiscal year 1995;
6
(ii) 106.9 percent for the determina-
7
tion with respect to fiscal year 1996; and
8
(iii) 107 percent for the determination
9
with respect to fiscal year 1997 and suc-
10
11
ceedingfiscalyears.
(2) MEDICARE PROGRAM.—
12
(A) I N GENERAL.—The target expenditure
13
determined under this paragraph for the medi-
14
care program for a fiscal year shall be an
15
amount equal to the applicable percentage of
16
the total expenditures under the medicare pro-
17
gram for the previousfiscalyear.
18
(B)
MEDICARE
APPLICABLE
PERCENT-
19
AGE.—For purposes of subparagraph (A), the
20
medicare applicable percentage is—
21
(i) 109.4 percent for the determina-
22
tion with respect to fiscal year 1995;
23
(ii) 108.9 percent for the determina-
24
tion with respect to fiscal year 1996;
•8 1807 PCS
�137
1
(iii) 108.5 percent for the determina-
2
tion with respect to fiscal year 1997; and
3
(iv) 108 percent for the determination
4
with respect to fiscal year 1998 and suc-
5
ceeding fiscal years.
6
SEC. 1302. DELAY OF HEALTH INSURANCE BENEFITS DUE
7
8
TO EXCESS EXPENDITURES.
(a) I N GENERAL.—If the Director determines that
9 there are medicaid or medicare excess expenditures for a
10 fiscal year under section 1301, any category of health in11 surance benefit described in subsection (b) that is effective
12 in the taxable or calendar year (whichever is applicable)
13 beginning after such fiscal year may be delayed until the
14 following year. This subsection shall be applied only to so
15 many of the categories of health insurance benefits de16 scribed in subsection (b) in the order in which such cat17 egories are listed such that the savings resulting from such
18 delay at least equal the costs of the medicaid and medicare
19 excess expenditures.
20
(b) HEALTH INSURANCE BENEFITS.—The categories
21 of health insurance benefits described in this subsection
22 are as follows:
23
(1) The tax credit under section 34A of the In-
24
ternal Revenue Code of 1986 applicable to individ-
•S 1807 PCS
�138
1
uals described in subparagraphs (C) and (D) of sec-
2
tion 34A(g)(l).
3
(2) The tax credit under section 34A of the In-
4
ternal Revenue Code of 1986 applicable to individ-
5
uals described in subparagraph (B) of section
6
34A(g)(l).
7
(3) The tax credit under section 34A of the In-
8
ternal Revenue Code of 1986 applicable to individ-
9
uals described in subparagraph (A) of section
10
11
12
34A(g)(l).
(4) The tax exclusion under section 106A of the
Internal Revenue Code of 1986.
13
(5) Assistance to individuals with preexisting
14
conditions in purchasing health insurance under sec-
15
tion 501.
•S 1807 PCS
�Calendar No. 370
1031) CONGRESS
2D SESSION
S. 1807
A BILL
To
guarantee individuals and families continued
choice and control over their doctors, hospitals,
and health care services, to secure access to quality health care for all, to ensure that health coverage is portable and renewable, to control medical cost inflation through market incentives and
tax reform, to reform medical malpractice litigation, and for other purposes.
FEBRUARY 22,1994
Read the second time and placed on the calendar
�
Dublin Core
The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/.
Title
A name given to the resource
Health Care Task Force Records
Creator
An entity primarily responsible for making the resource
White House Health Care Task Force
Is Part Of
A related resource in which the described resource is physically or logically included.
<a href="https://catalog.archives.gov/id/10443060" target="_blank">National Archives Catalog Description</a>
Description
An account of the resource
<p>This collection contains records on President Clinton’s efforts to overhaul the health care system in the United States. In 1993 he appointed First Lady Hillary Rodham Clinton to be the head of the Health Care Task Force (HCTF). She traveled across the country holding hearings, conferred with Senators and Representatives, and sought advice from sources outside the government in an attempt to repair the health care system in the United States. However, the administration’s health care plan, introduced to Congress as the Health Security Act, failed to pass in 1994.</p>
<p>Due to the vast amount of records from the Health Care Task Force the collection has been divided into segments. Segments will be made available as they are digitized.</p>
<p><a href="http://clinton.presidentiallibraries.us/items/browse?advanced%5B0%5D%5Belement_id%5D=43&advanced%5B0%5D%5Btype%5D=is+exactly&advanced%5B0%5D%5Bterms%5D=2006-0885-F+Segment+1"><strong>Segment One</strong></a><br /> This collection consists of Ira Magaziner’s Health Care Task Force files including: correspondence, reports, news clippings, press releases, and publications. Ira Magaziner a Senior Advisor to President Clinton for Policy Development was heavily involved in health care reform. Magaziner assisted the Task Force by coordinating health care policy development through numerous working groups. Magaziner and the First Lady were the President’s primary advisors on health care. The Health Care Task Force eventually produced the administration’s health care plan, introduced to Congress as the Health Security Act. This bill failed to pass in 1994.<br /> Contains 1065 files from 109 boxes.</p>
<p><a href="http://clinton.presidentiallibraries.us/items/browse?advanced%5B0%5D%5Belement_id%5D=43&advanced%5B0%5D%5Btype%5D=is+exactly&advanced%5B0%5D%5Bterms%5D=2006-0885-F+Segment+2"><strong>Segment Two</strong></a><br /> This segment consists of records describing the efforts of First Lady Hillary Rodham Clinton to get health care reform through Congress. This collection consists of correspondence, newspaper and magazine articles, memos, papers, and reports. A significant feature of the records are letters from constituents describing their feelings about health care reform and disastrous financial situations they found themselves in as the result of inadequate or inappropriate health insurance coverage. The collection also contains records created by Robert Boorstin, Roger Goldblatt, Steven Edelstein, Christine Heenan, Lynn Margherio, Simone Rueschemeyer, Meeghan Prunty, Marjorie Tarmey, and others.<br /> Contains 697 files from 47 boxes.</p>
<p><a href="http://clinton.presidentiallibraries.us/items/browse?advanced%5B0%5D%5Belement_id%5D=43&advanced%5B0%5D%5Btype%5D=is+exactly&advanced%5B0%5D%5Bterms%5D=2006-0885-F+Segment+3"><strong>Segment Three</strong></a><br /> The majority of the records in this collection consist of reports, polls, and surveys concerning nearly all aspects of health care; many letters from the public, medical professionals and organizations, and legislators to the Task Force concerning its mission; as well as the telephone message logs of the Task Force.<br /> Contains 592 files from 44 boxes.</p>
<p><a href="http://clinton.presidentiallibraries.us/items/browse?advanced%5B0%5D%5Belement_id%5D=43&advanced%5B0%5D%5Btype%5D=is+exactly&advanced%5B0%5D%5Bterms%5D=2006-0885-F+Segment+4"><strong>Segment Four</strong></a><br /> This collection consists of records describing the efforts of the Clinton Administration to pass the Health Security Act, which would have reformed the health care system of the United States. This collection contains memoranda, correspondence, handwritten notes, reports, charts, graphs, bills, drafts, booklets, pamphlets, lists, press releases, schedules, newspaper articles, and faxes. The collection contains lists of experts from the field of medicine willing to testify to the viability of the Health Security Act. Much of the remaining material duplicates records from the previous segments.<br /> Contains 590 files from 52 boxes.</p>
<p><strong><a href="http://clinton.presidentiallibraries.us/items/browse?advanced%5B0%5D%5Belement_id%5D=43&advanced%5B0%5D%5Btype%5D=is+exactly&advanced%5B0%5D%5Bterms%5D=2006-0885-F+Segment+5">Segment Five</a></strong><br /> This collection of the Health Care Task Force records consists of materials from the files of Robert Boorstin, Alice Dunscomb, Richard Veloz and Walter Zelman. The files contain memoranda, correspondence, handwritten notes, reports, charts, graphs, bills, drafts, booklets, pamphlets, lists, press releases, schedules, statements, surveys, newspaper articles, and faxes. Much of the material in this segment duplicates records from the previous segments.<br /> Contains 435 files from 47 boxes.</p>
<p><strong><a href="http://clinton.presidentiallibraries.us/items/browse?advanced%5B0%5D%5Belement_id%5D=43&advanced%5B0%5D%5Btype%5D=is+exactly&advanced%5B0%5D%5Bterms%5D=2006-0885-F+Segment+6">Segment Six</a></strong><br /> This collection consists of the files of the Health Care Task Force, focusing on material from Jack Lew and Lynn Margherio. Lew’s records reflect a preoccupation with figures, statistics, and calculations of all sorts. Graphs and charts abound on the effect reform of the health care system would have on the federal budget. Margherio, a Senior Policy Analyst on the Domestic Policy Council, has documents such as: memoranda, notes, summaries, and articles on individuals (largely doctors) deemed to be experts on the Health Security Act of 1993 qualified to travel across the country and speak to groups in glowing terms about the groundbreaking initiative put forward by President Clinton in his first year in the White House. <br /> Contains 804 files from 40 boxes.</p>
Publisher
An entity responsible for making the resource available
William J. Clinton Presidential Library & Museum
Identifier
An unambiguous reference to the resource within a given context
2006-0885-F
Text
A resource consisting primarily of words for reading. Examples include books, letters, dissertations, poems, newspapers, articles, archives of mailing lists. Note that facsimiles or images of texts are still of the genre Text.
Original Format
The type of object, such as painting, sculpture, paper, photo, and additional data
Paper
Dublin Core
The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/.
Title
A name given to the resource
[S.1807 - Gramm Health Care] [Loose]
Creator
An entity primarily responsible for making the resource
White House Health Care Task Force
Health Care Task Force
Christine Heenan
Identifier
An unambiguous reference to the resource within a given context
2006-0885-F Segment 4
Is Part Of
A related resource in which the described resource is physically or logically included.
Box 13
<a href="http://clinton.presidentiallibraries.us/items/show/36149" target="_blank">Collection Finding Aid</a>
<a href="https://catalog.archives.gov/id/12091530" target="_blank">National Archives Catalog Description</a>
Provenance
A statement of any changes in ownership and custody of the resource since its creation that are significant for its authenticity, integrity, and interpretation. The statement may include a description of any changes successive custodians made to the resource.
Clinton Presidential Records: White House Staff and Office Files
Publisher
An entity responsible for making the resource available
William J. Clinton Presidential Library & Museum
Format
The file format, physical medium, or dimensions of the resource
Adobe Acrobat Document
Medium
The material or physical carrier of the resource.
Reproduction-Reference
Date Created
Date of creation of the resource.
4/16/2015
Source
A related resource from which the described resource is derived
12091530
42-t-12091530-20060885F-Seg4-013-006-2015