II 103d CONGRESS £1 325 1st Session <\ , _ To provide for comprehensive health care access expansion and cost control through reform and simplification of private health care insurance and other means. IN THE SENATE OF THE UNITED STATES February 4 (legislative day, January 5), 1993 Mrs. KASSEBAUM (for herself, Mr. Danforth, and Mr. BURNS) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To provide for comprehensive health care access expansion and cost control through reform and simplification of private health care insurance and other means. 1 Be it enacted by the Senate and House ofRepresenta- 2 tives ofthe United States ofAmerica in Congress assembled, 3 SECTION SHORT TITLE; TABLE OF CONTENTS. 1. — 4 (a) Short Title. This Act may be cited as the 5 "BasiCare Health Access and Cost Control Act". — 6 (b) Table of Contents. The table of contents of 7 this Act is as follows: See. 1. Short title; table of contents. TITLE I—IMMEDIATE REFORMS — — — 2 — Subtitle A Small Employer Health Insurance Market Reform Sec. 101. General requirements. Sec. 102. General issuance requirements. Sec. 103. Specific contractual requirements. Sec. 104. State compliance agreements. Sec. 105. Definitions and other rules. Sec. 106. Amendment to the Internal Revenue Code of 1986. Sec. 107. Effective date. — Subtitle B Community Health Services Expansion Sec. 111. Establishment of grant program. Sec. 112. Program to provide for expansion of federally qualified health centers. — Subtitle C Expansion of Tax Incentives for Self-Employed Individuals Sec. 121. Permanent increase in deductible health insurance costs for self-em- ployed individuals. — Subtitle D Expanding the Supply of Health Professionals in Rural Areas Sec. 131. Expansion of National Health Service Corps. Sec. 132. Tax incentives for practice in rural areas. — Subtitle E Malpractice Reform Part I Definitions Sec. 141. Definitions. Part II Tort Reform of Health Care Liability Actions Sec. 142. Application to civil actions. Sec. 143. Damages. Sec. 144. Joint and several liability. Sec. 145. Statute of limitations. Sec. 146. Preemption. Sec. 147. Effective date. Part III Alternative Dispute Resolution Systems Sec. 148. Grants for alternative dispute resolution systems. Sec. 149. Establishment of advisory panel. Sec. 150. Authorization. Part IV—Demonstration Projects for No-Fault Compensation Programs Sec. 151. Demonstration projects for no-fault compensation programs. — Subtitle F Joint Ventures Sec. 161. Amendment of the National Cooperative Research Act of 1984. TITLE II—LONG-TERM REFORMS A— Subtitle Establishment of Commission and Advisory Board Sec. 201. The Commission on National Health Care Access and Reform. •S 325 IS 3 See. 202. National Advisory Board. Sec. 203. Authorization of appropriations. — Subtitle B Reform and Standardization of Private Insurance Sec. 211. Defining goals and guidelines of Commission. Sec. 212. Development and submission of legislative proposal. Sec. 213. Continuing duties and responsibilities of the Commission. Sec. 214. BasiCare benefits package. Sec. 215. Insurance responsibilities under BasiCare. Sec. 216. BasiCare base premium rate. Sec. 217. Employer responsibilities under BasiCare. Sec. 218. Individual responsibilities under BasiCare. Sec. 219. Self-insured plan requirements. Sec. 220. Provider responsibilities under BasiCare. Sec. 221. Development of standards for managed care plans. Sec. 222. Preemption of provisions relating to managed care. — Subtitle C Low-Income Assistance Sec. 231. Transfer from medicaid to BasiCare. Sec. 232. Low-income assistance with costs of BasiCare insurance. — Subtitle D Congressional Consideration of Commission Recommendation Sec. 241. Rules governing congressional consideration. — Subtitle E Enforcement Provisions Sec. 251. Enforcement provisions for carriers, providers, and employers. Sec. 252. Enforcement provision for individuals. — F Subtitle Financial Provisions Sec. 261. BasiCare Trust Fund. Sec. 262. Tax treatment of costs of BasiCare insurance. — G Subtitle Definitions Sec. 271. Definitions. TITLE I—IMMEDIATE REFORMS 1 — A Subtitle Small Employer Health 2 Insurance Market Reform 3 4 SEC. 101. GENERAL REQUIREMENTS. 5 Any person issuing an accident and health insurance 6 contract to any small employer shall meet the require- 7 ments of sections 102 and 103. •S 325 is — — 4 1 SEC. 102. GENERAL ISSUANCE REQUIREMENTS. — 2 (a) General Rule. The requirements of this sec- 3 tion are met if any person issuing an accident and health 4 insurance contract to any small employer meets 5 (1) the mandatory policy requirements of sub- 6 section (b), and 7 (2) the guaranteed issue requirements of sub- 8 section (c). — 9 (b) Mandatory Policy Requirements. — 10 (1) In general. The requirements of this 1 1 subsection are met if any person issuing an accident 12 and health insurance contract to airy small employer 13 makes available to such small employer an accident 14 and health insurance contract which provides bene- 15 fits which are identical to the core benefits described 16 in subsection (d). 17 (2) Pricing and marketing require- — 18 ments. The requirements of paragraph (1) are not 19 met unless 20 (A) the price at which the accident and 21 health insurance contract is made available is 22 not greater than the price for such contract de- 23 termined on the same basis as prices for other 24 accident and health insurance contracts within 25 the same class of business made available by 26 the person to small employers, and •S 325 IS — 5 (B) the accident and health insurance con- 1 2 tract is made available to small employers using 3 substantially the same marketing methods and 4 other sales practices which are used in selling 5 such other contracts. — 6 (c) Guaranteed Issue. 7 (1) In GENERAL.—The requirements of this 8 subsection are met 9 (A) if the person offering accident and 10 health insurance contracts to small employers 11 issues such contracts to any small employer 12 seeking to enter into such a contract, and 13 (B) if the person offers a managed care ar- 14 rangement in a State, or a geographic area 15 within a State, to employers that are not small 16 employers, the person offers such managed care 17 arrangement to small employers in the State or 18 geographic area. — 19 (2) Financial capacity exception. Para- 20 graph (1)(A) shall not require any person to issue 21 an accident and health insurance contract to the ex- 22 tent that the issuance of such contract would result 23 in such person violating any financial solvency 24 standards established by the State in which such 25 contract is to be issued. S 325 IS — 6 — Exceptions for certain employers. 1 (3) 2 Paragraph (1)(A) shall not apply to a failure to 3 issue an accident and health insurance contract to a 4 small employer if 5 (A) the small employer is unable to pay the 6 premium for such contract, or 7 (B) in the case of a small employer with 8 fewer than 15 employees, such employer fails to 9 enroll at least 60 percent of the employer's eli- 10 gible emploj^ees for coverage under such con- 1 1 tract. 12 (4) Size limits for managed care arrange- — 13 MENTS. Paragraph (1)(B) shall not apply to any 14 person who ceases to enroll new small employer 15 groups in a managed care arrangement if it ceases 16 to enroll any new employer groups in such arrange- 17 ment. — 18 (d) Benefits. — 19 (1) Core benefits. For purposes of this sec- 20 tion, the term "core benefits" means benefits which 21 are the same benefits provided as of the date of the 22 enactment of this Act under title XVIII of the Social 23 Security Act to individuals entitled to benefits under B 24 part A, and enrolled for benefits under part of 25 such title. •S 325 is 7 — Deductibles and copayments. An 1 (2) acci- 2 dent and health insurance contract shall not be 3 treated as providing the core benefits described in 4 paragraph (1) unless the following requirements are 5 met: — 6 (A) Deductible. The accident and 7 health insurance contract does not require a de- 8 ductible amount for any contract year in excess 9 of $500 per individual or $1,000 per family 10 with respect to the core benefits. 11 (B) Limit on out-of-pocket ex- — 12 PENSES. The accident and health insurance 13 contract does not require out-of-pocket expenses 14 for an}' contract year in excess of $2,000 per 15 individual or $3,000 per family for the core 16 benefits. — 17 (C) Children. 18 (i) No deductibles or coinsur- — 19 ANCE. In the case of children, there shall 20 be no coinsurance, deductibles, or 21 copayments applicable to covered benefits 22 described in clause (ii). 23 Additional preventive bene- (ii) — 24 fits. Subject to the periodicity schedule 25 established under clause (hi), benefits shall •S 325 IS 8 1 be available for children under the accident 2 and health insurance contract for the fol- 3 lowing items and services: 4 (I) Newborn and well-baby care, 5 including normal newborn care and 6 pediatrician services for high-risk de- 7 liveries. 8 (II) Well-child care, including 9 routine office visits, routine immuni- 10 zations (including the vaccine itself), 11 routine laboratory tests, and preven- 12 tive dental care. — 13 (hi) Periodicity schedule. The 14 Secretary, in consultation with the Amer- 15 ican Academy of Pediatrics, shall establish 16 a schedule of periodicity which reflects the 17 general, appropriate frequency with which 18 services listed in clause (ii) should be pro- 19 vided to healthy children. — 20 (iv) Child defined. For purposes 21 of this subparagraph, the term "child" 22 means an individual who has not attained 23 age 23. — 24 (D) Pregnancy-related services. S 325 IS 9 NO DEDUCTIBLES OR COINSUR- 1 (i) — 2 ANCE. In the case of a pregnant woman, 3 there shall be no coinsurance, deductibles, 4 or copayments applicable to covered bene- 5 fits described in clause (ii). — 6 Additional benefits. Subject (ii) 7 to the periodicity schedule established 8 under clause (iii), benefits shall be avail- 9 able for pregnant women under the acci- 10 dent and health insurance contract for the 1 1 following items and services: 12 (I) Prenatal care, including care 13 for all complications of pregnancy. 14 (II) Inpatient labor and delivery 15 services. 16 (III) Postnatal care. 17 (IV) Postnatal family planning 18 services. — 19 Periodicity schedule. The (iii) 20 Secretary, in consultation with the Amer- 21 ican College of Obstetrics and Gynecology, 22 shall establish a schedule of periodicity 23 which reflects the general, appropriate fre- 24 quency with which services listed in clause S 325 IS — 10 1 (ii) should be provided to pregnant women 2 without complications of pregnancy. — 3 (iv) Pregnant woman. For pur- 4 poses of this subparagraph, the term 5 "pregnant woman" means a woman who 6 has been certified by a physician (in a 7 manner specified by the Secretary) as 8 being pregnant and such woman shall be a 9 pregnant woman for the purposes of this 10 subparagraph until the last day of the 11 month in which the 60-day period begin- 12 ning on the date of termination of the 13 pregnane}' ends. — 14 (3) Preemption. To the extent that the laws 15 of an}' State or local government regulate or other- 16 wise provide an}' requirement relating to the benefits 17 to be provided under an accident and health insur- 18 ance contract which are inconsistent with the provi- 19 sions of this Act, they are preempted. 20 SEC. 103. SPECIFIC CONTRACTUAL REQUIREMENTS. — 21 (a) General Rule. The requirements of this sec- 22 tion are met if any person issuing an accident and health 23 insurance contract to any small employer meets 24 (1) the coverage requirements of subsection (b), 25 and •S 325 IS