S. 1298Senate110th Congress (2007-2009)In Committee

Healthy Businesses, Healthy Workers Reinsurance Act of 2007

Introduced May 3, 2007

Legislative Activity

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2 earlier actions
SenateIntro Referral Latest Action

Read twice and referred to the Committee on Finance. (text of measure as introduced: CR S5594-5595)

May 3, 2007

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SenateIntro Referral

Introduced in Senate

May 3, 2007

SenateIntro Referral

Sponsor introductory remarks on measure. (CR S5593-5594)

May 3, 2007

SenateIntro Referral

Read twice and referred to the Committee on Finance. (text of measure as introduced: CR S5594-5595)

May 3, 2007

Floor Debate

17 members

What members said about S. 1298 on the floor

7 Republicans10 Democrats
Larry E. Craig
Sen. Larry E. CraigR-ID · May 3, 2007

Mr. President, I have sought recognition today to comment on a bill I am introducing to help ensure the long-term ability of the United States Court of Appeals for Veterans Claims to promptly…

Richard J. Durbin
Sen. Richard J. DurbinD-IL · May 3, 2007

Mr. President, I rise today to introduce the bipartisan Methamphetamine Production Prevention Act of 2007. I am pleased to have the support and cosponsorship of Senator Grassley for this important…

Edward M. Kennedy
Sen. Edward M. KennedyD-MA · May 3, 2007

Mr. President, I am pleased today to introduce the Keeping Parents and Communities Engaged or Keeping PACE Act, to foster greater involvement of parents in their children's education, engage…

Norm Coleman
Sen. Norm ColemanR-MN · May 3, 2007

Mr. President, I rise to introduce the Medicare Provider Accountability Act on behalf of myself, and my colleagues Senator Levin and Senator McCaskill. This bill is a direct result of the recent…

John F. Kerry
Sen. John F. KerryD-MA · May 3, 2007

Mr. President, I am pleased to join my colleagues Senators Smith, Conrad, Snowe, and Bingaman in introducing the Women's Retirement Security Act of 2007. This legislation comes on the heels of the…

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Carl Levin
Sen. Carl LevinD-MI · May 3, 2007

Mr. President, I join today with my colleagues, Senator Coleman and Senator McCaskill, in introducing the Medicare Provider Accountability Act. This bill targets Medicare, a program which is…

Chuck Grassley
Sen. Chuck GrassleyR-IA · May 3, 2007

Mr. President, I am pleased to join my colleague, Senator Durbin, in introducing the Methamphetamine Production Prevention Act of 2007. Together we offer this important legislation in an effort to…

Byron L. Dorgan
Sen. Byron L. DorganD-ND · May 3, 2007

Mr. President, today I am joined by Senators Mikulski, Durbin, Stabenow, Rockefeller, Levin, Feinstein, Johnson, Harkin, Feingold, Leahy, Kohl, and Kennedy in introducing legislation to close an…

Daniel K. Akaka
Sen. Daniel K. AkakaD-HI · May 3, 2007

Mr. President, I rise today, along with my friends Senators Durbin and Cochran, to reintroduce legislation that will provide students much needed educational opportunities in foreign languages and…

Benjamin L. Cardin
Sen. Benjamin L. CardinD-MD · May 3, 2007

Mr. President, as you know, teachers are the most valuable resource when it comes to educating our Nation's children. Under the No Child Left Behind Act, (NCLB), States are required to recruit highly…

Mark L. Pryor
Sen. Mark L. PryorD-AR · May 3, 2007

Mr. President, I thank the Senator from Georgia for his kind remarks. Of course, everybody in the Senate knows what a friend to the men and women in uniform Senator Chambliss has been since he has…

Saxby Chambliss
Sen. Saxby ChamblissR-GA · May 3, 2007

Mr. President, I rise today to join my colleague and my good friend, the Senator from Arkansas, Mr. Pryor, in introducing legislation to ensure that the medical needs of wounded service men and women…

John F. Kerry
Sen. John F. KerryD-MA · May 3, 2007

Mr. President, States like my home state of Massachusetts are setting an example for the rest of the country by taking bold steps to provide quality health coverage for everyone. Now it is time for…

Show 6 more
Charles E. Schumer
Sen. Charles E. SchumerD-NY · May 3, 2007

Mr. President, today I, along with Senators Lott and Conrad, introduce the Medicare Ambulance Payment Extension Act. Without this legislation, ambulance service providers stand to lose $306 million…

John McCain
Sen. John McCainR-AZ · May 3, 2007

Mr. President, I am pleased to be joined today by Senator Kyl in introducing the Arizona Trail Feasibility National Scenic Trail Act. This bill would designate the Arizona Trail as a National Scenic…

Gordon H. Smith
Sen. Gordon H. SmithR-OR · May 3, 2007

Mr. President, today I am introducing the Women's Retirement Security Act of 2007. This measure has the potential to make a significantly positive impact on the ability of Americans to save for their…

Jon Kyl
Sen. Jon KylR-AZ · May 3, 2007

Mr. President, today I am pleased to join with Senator McCain in introducing the Arizona National Scenic Trail Act. This bill would amend the National Trails System Act to designate the Arizona Trail…

Jack Reed
Sen. Jack ReedD-RI · May 3, 2007

Mr. President, I join my colleague, Senator Kerry, in introducing the Reinsure America's Businesses Act of 2007. This legislation represents a critical step forward in bringing affordable health care…

Jack Reed
Sen. Jack ReedD-RI · May 3, 2007

Mr. President, I join my colleague, Senator Kerry, in introducing the Reinsure America's Businesses Act of 2007. This legislation represents a critical step forward in bringing affordable health care…

Bill Text

Latest available legislative text

Reading Mode
Latest
Introduced in SenateIssued May 3, 2007

II

110th CONGRESS

1st Session

S. 1298

IN THE SENATE OF THE UNITED STATES

May 3, 2007

Mr. Kerry (for himself and Mr. Reed) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To amend the Social Security Act to establish a Federal Reinsurance Program for Catastrophic Health Care Costs.

1.

Short title

This Act may be cited as the Healthy Businesses, Healthy Workers Reinsurance Act of 2007.

2.

Findings

Congress finds the following:

(1)

The cost of health insurance premiums for families has risen 87 percent since 2000, nearly 4 times the growth in overall inflation and workers earnings.

(2)

Health insurance premium increases have resulted in a nearly 10 percentage point drop in the number of firms choosing to offer coverage to their workers over that time period.

(3)

Today, just 48 percent of firms with between 3 and 9 employees offer health insurance benefits, down from 58 percent in 2001.

(4)

The decline in employer-sponsored coverage has added to the growing problem of the uninsured. An additional 4 million Americans have been added to the ranks of the uninsured since 2001.

(5)

Health care costs are highly concentrated. Twenty percent of the population that is catastrophically or chronically ill accounts for 80 percent of the health care spending, with just 1 percent driving a full 22 percent of health care costs.

3.

Federal Reinsurance Program for Catastrophic Health Care Costs

(a)

Program

The Social Security Act (42 U.S.C. 301 et seq.) is amended by adding at the end the following new title:

XXII

Federal Reinsurance Program for Catastrophic Health Care Costs

2201.

Office of Federal Reinsurance

(a)

In general

There is established within the Department of Health and Human Services an office to be known as the Office of Federal Reinsurance.

(b)

Duty

The Office of Federal Reinsurance shall establish and administer the Federal Reinsurance Program for Catastrophic Health Care Costs in accordance with the provisions of this title.

2202.

Program

(a)

Establishment

(1)

In general

The Office shall establish and administer a Federal Reinsurance Program for Catastrophic Health Care Costs under which reinsurance payments are provided to eligible health plans that experience catastrophic health care costs during a year with respect to an individual covered under the plan. For purposes of this title, the term individual covered under the plan includes employees, retirees, spouses, and dependants.

(2)

Program to begin in 2009

The Office shall establish the Program in a manner so that reinsurance payments are made with respect to catastrophic health care costs occurring on or after January 1, 2009.

(3)

Eligible health plan

(A)

In general

In this title, the term eligible health plan means any of the following:

(i)

A group health plan that meets the requirements described in subparagraph (B).

(ii)

A governmental plan (as defined in section 3(32) of the Employee Retirement Income Security Act of 1974) that meets the requirements described in subparagraph (B).

(iii)

A multiemployer plan (as defined in section 3(37) of the Employee Retirement Income Security Act of 1974) that meets the requirements described in subparagraph (B).

(iv)

A plan that offers coverage through health purchasing cooperatives in conjunction with a State health program that makes available health insurance coverage to the small group market and the individual market on the same terms and that meets the requirements described in subparagraph (B).

(B)

Requirements

The requirements described in this subparagraph are that—

(i)

the plan involved—

(I)

provides eligibility for health insurance coverage (after any waiting period (as defined in section 9801(b)(4))) to all full-time employees of the employer maintaining or contributing to the plan;

(II)

ensures that if there is a deductible under the plan, such deductible does not exceed $1,000 for an individual and $2,000 for a family;

(III)

ensures that the plan offers preventative benefits; and

(IV)

ensures that the plan employs effective high-cost case management tools (in accordance with the definition of disease management by the Disease Management Association of America) in order to reduce costs over time; and

(ii)

the employer maintaining or contributing to the plan involved pays at least 50 percent of the costs of health insurance coverage for each employee covered under the plan (regardless of whether the employee is a full-time or part-time employee).

(C)

Cost-of-living adjustment

(i)

In general

In the case of any calendar year after 2009. each dollar amount in subparagraph (B)(ii) shall be increased by an amount equal to—

(I)

such dollar amount, multiplied by

(II)

the cost-of-living adjustment determined under section 1(f)(3) of the Internal Revenue Code of 1986 for such calendar year determined by substituting calendar year 2008 for calendar year 1992 in subparagraph (B) thereof.

(ii)

Date for determination

For purposes of clause (i), section 1(f)(4) of such Code shall be applied by substituting March 31 for August 31, and the Secretary of the Treasury shall publish the adjusted amounts under subparagraph (B)(ii) for the calendar year not later than June 1 of the preceding calendar year.

(iii)

Rounding

If any increase under clause (i) is not a multiple of $50, such increase shall be rounded to the nearest multiple of $50.

(D)

Employer

For purposes of this title, the term employer includes the Federal government and any other governmental entity (within the meaning of section 5000(d) of Internal Revenue Code of 1986).

(b)

Enrollment

(1)

Procedures

The Office shall establish procedures for the enrollment of eligible health plans in the Program.

(2)

Application and annual recertification

(A)

In general

The procedures established under paragraph (1) shall include a process for an eligible health plan—

(i)

to submit an application to the Office for enrollment in the Program; and

(ii)

to be annually recertified for enrollment in the Program.

(B)

Requirement

The application and recertification process under subparagraph (A) shall require that an eligible health plan submit to the Office—

(i)

a detailed description of the projected and actual reduction in total costs under the plan that are a result of the Program, including both individual and employer portions; and

(ii)

such other information determined appropriate by the Office.

(3)

Approval

(A)

In general

The procedures established under paragraph (1) shall provide for the approval or disapproval of applications and requests for recertification submitted by eligible health plans under paragraph (2).

(B)

Specific requirement

The Office shall not approve an application or a request for recertification unless the Office finds that the eligible health plan is reducing total costs under the plan, based on the information submitted under paragraph (2)(B) and audits conducted under paragraph (4).

(4)

Audits

The Office shall conduct audits of claims data of eligible health plans in order to ensure that the eligible health plan is in compliance with the requirements under the Program, including the requirement under paragraph (3)(B). An eligible health plan shall not be eligible for reinsurance payments unless it provides the Office with access to such data.

(c)

Cost-sharing in costs of Program

(1)

In general

An eligible health plan that participates in the Program shall pay the fee established by the Office under paragraph (2).

(2)

Authorization

The Office is authorized to charge a fee to each eligible health plan that participates in the Program. Any amounts collected shall be deposited into the Trust Fund.

(3)

Requirements

In establishing the fee under paragraph (2)—

(A)

the Office shall consult with interested parties; and

(B)

shall ensure that the amount of such fee is not excessive so as to unduly discourage eligible health plans from enrolling in the Program.

(d)

Appeals process

The Office shall establish an appeals process under the Program.

(e)

Procedures to protect against fraud, waste, and abuse

The Office shall establish procedures to protect against fraud, waste, and abuse under the Program.

2203.

Reinsurance payments

(a)

Amount

(1)

In general

The amount of a reinsurance payment under the Program to an eligible health plan that experiences catastrophic health care costs in a year with respect to an individual covered under the plan shall be an amount equal to 75 percent of such costs.

(2)

Catastrophic health care costs

(A)

In general

In this title, the term catastrophic health care costs means, with respect to a year, costs for medical care (as defined in section 9832(d)(3) of the Internal Revenue Code of 1986) provided under an eligible health plan to an individual covered under the plan, but only with respect to such costs which exceed $50,000.

(B)

Negotiated prices

In determining the amount of catastrophic health care costs under the Program, the eligible health care plan shall take into account any negotiated price concessions, such as discounts, direct or indirect subsidies, rebates, and direct or indirect remunerations, obtained by the plan.

(C)

Inflation adjustment

(i)

In general

In the case of a calendar year after 2009, the $50,000 amount in subparagraph (A) shall be increased by an amount equal to—

(I)

such dollar amount; multiplied by

(II)

the percentage (if any) by which the average of the medical care component of the Consumer Price Index for all urban consumers (United States city average) for the 12-month period ending with August of the preceding calendar year exceeds such average for the 12-month period ending with August 2008.

(ii)

Rounding

If any dollar amount after being increased under clause (i) is not a multiple of $1,000, such dollar amount shall be rounded to the nearest multiple of $1,000.

(b)

Requests for payment

To be eligible for a reinsurance payment with respect to an individual for a year, an eligible health plan shall submit to the Office, at a time and in a manner determined appropriate by the Office, a request for payment that contains—

(1)

a certification—

(A)

that the plan paid or incurred catastrophic health care costs during the year with respect to the individual; and

(B)

of the amount of such costs; and

(2)

such other information determined appropriate by the Office.

(c)

Payments from Trust Fund

(1)

In general

Payments to eligible health plans under the Program shall be made from the Trust Fund.

(2)

Tax treatment

For purposes of the Internal Revenue Code of 1986—

(A)

payments from the Trust Fund to the eligible health plan shall not be included in gross income; and

(B)

no deduction shall be allowed to the eligible health plan with respect to the payment of any catastrophic health care costs for the portion of such costs which was reimbursed from the Trust Fund.

2204.

Federal Reinsurance for Catastrophic Health Care Costs Trust Fund

(a)

Creation of Trust Fund

There is established in the Treasury of the United States a trust fund to be known as the Federal Reinsurance for Catastrophic Health Care Costs Trust Fund, consisting of such amounts as may be appropriated or credited to the Trust Fund (including any fees deposited under section 2202(c)).

(b)

Mandatory appropriations

There are appropriated to the Trust Fund such sums as may be necessary in order to make the reinsurance payments required under section 2203.

(c)

Rules regarding transfers to and management of Trust Fund

For purposes of this section, rules similar to the rules of sections 9601 and 9602 of the Internal Revenue Code of 1986 shall apply.

(d)

Distribution of amounts in Trust Fund

Amounts in the Trust Fund shall be available for making payments under section 2203.

2205.

Reports

(a)

Secretary

(1)

In general

Not later than March 1, 2011, and biennially thereafter, the Secretary shall submit to Congress a report on the Program.

(2)

Requirements

(A)

In general

Each report submitted under paragraph (1) shall contain—

(i)

a detailed description of the Program, including a detailed description of the impact the Program has had on reducing premiums for health insurance coverage and increasing the number of individuals with health insurance coverage; and

(ii)

any other information or recommendations determined appropriate by the Secretary.

(B)

Individual market

The first report submitted under paragraph (1) shall also contain recommendations regarding expanding the Program to the individual market.

(C)

Consultation

The Secretary shall consult with the National Association of Insurance Commissioners in preparing each report under paragraph (1).

(b)

GAO

(1)

In general

Not later than March 1, 2011, and biennially thereafter, the Comptroller General of the United States shall submit to Congress and the Secretary a report on the Program.

(2)

Requirements

(A)

In general

Each report submitted under paragraph (1) shall contain—

(i)

a detailed description of the Program, including a detailed description of the impact the Program has had on reducing premiums for health insurance coverage and increasing the number of individuals with health insurance coverage; and

(ii)

any other information or recommendations determined appropriate by the Comptroller General.

(B)

Individual market

The first report submitted under paragraph (1) shall also contain recommendations regarding expanding the Program to the individual market.

2206.

Definitions

In this title:

(1)

Group health plan

The term group health plan has the meaning given such term by section 5000(b)(1) of the Internal Revenue Code of 1986.

(2)

Individual market; small group market

The terms individual market and small group market have the meanings given such terms by section 2791 of the Public Health Service Act.

(3)

Office

The term Office means the Office of Federal Reinsurance established under section 2201.

(4)

Program

The term Program means the Federal Reinsurance Program for Catastrophic Health Care Costs under this title.

(5)

Trust Fund

The term Trust Fund means the Federal Reinsurance for Catastrophic Health Care Costs Trust Fund established under section 2204.

.

(b)

Funding start-Up administrative costs for Program

(1)

In general

There are appropriated to the Secretary of Health and Human Services $200,000,000 to carry out the provisions of, and amendments made by, this Act.

(2)

Availability

Amounts appropriated under paragraph (1) shall remain available until September 30, 2009.