To provide for a system of health insurance certificates to increase the number of Americans with health insurance coverage.

July 10, 2003

Mr. BILIRAKIS (for himself, Mr. TOWNS, Mr. FLETCHER, and Mr. WALDEN of Oregon) introduced the following bill; which was referred to the Committee on Energy and Commerce

To provide for a system of health insurance certificates to increase the number of Americans with health insurance coverage.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Health Insurance Certificate Act of 2003'.

SEC. 2. ESTABLISHMENT OF PROGRAM.

(a) IN GENERAL- The Secretary of Health and Human Services (in this Act referred to as the `Secretary') shall establish a program for the issuance to eligible individuals of health insurance certificates which may be applied towards the cost of purchasing qualified health insurance coverage for such individuals and family members. The issuance of such certificates for any fiscal year is limited to the amount appropriated under subsection (f) for such fiscal year.

(b) ELIGIBILITY-

(1) IN GENERAL- For purposes of this Act, the terms `eligible individual' and `qualified family member' mean, with respect to a month, an adult or family member, respectively, who--

(A) is a citizen or national of the United States or an alien permanently residing lawfully in the United States as of the first day of the month;

(B) is under 65 years of age as of the last day of the month; and

(C) is not eligible to be covered under public coverage described in paragraph (3) as of the first day of the month.

(2) NO CERTIFICATE FOR COVERED FAMILY MEMBERS-

(A) IN GENERAL- No certificate shall be issued under this section to a member of the family of a principal eligible individual if the family member is covered under the qualified health insurance coverage covering the principal eligible individual.

(B) MEMBER OF FAMILY- For purposes of this Act, the term `member of family' has the meaning given such term under section 8901(5) of title 5, United States Code.

(C) SPOUSE- For purposes of this Act, the term `married' and `spouse' shall have the meaning given such term for purposes of chapter 89 of title 5, United States Code.

(D) NO DUPLICATION- In no case may the certificate value of more than one certificate take into account any member of a family and, with respect to an eligible individual, no more than 2 member of the individual's family (other than the spouse of the individual) shall be taken into account.

(3) EXCLUSION FOR THOSE ELIGIBLE FOR COVERAGE UNDER PUBLIC PROGRAM- Subject to paragraph (4), an individual is not an eligible individual as of the first day of a month if such individual is eligible to be covered as of such day under any medical care program described in--

(A) title XVIII, XIX, or XXI of the Social Security Act;

(B) chapter 55 of title 10, United States Code;

(C) chapter 17 of title 38, United States Code;

(D) chapter 89 of title 5, United States Code; or

(E) the Indian Health Care Improvement Act.

(4) TREATMENT OF COBRA CONTINUATION COVERAGE- In the case of continuation coverage under a group health plan which is required to be provided by Federal law for an individual during the period specified in section 602(2) of the Employee Retirement Income Security Act of 1974, section 4980B(f)(2)(B) of the Internal Revenue Code of 1986, or section 2202(2) of the Public Health Service Act, or coverage under chapter 89 of title 5, United States Code which is required to be provided under section 8905a of title 5, United States Code, paragraph (3) shall not apply with respect to such

continuation coverage and the coverage shall be treated as qualified health insurance coverage.

(c) HEALTH INSURANCE CERTIFICATES-

(1) IN GENERAL- The Secretary shall design health insurance certificates to be in a form so that, when presented to the issuer of a qualified health insurance coverage, the issuer may secure directly from the Secretary the value specified in the certificate towards the cost of purchasing such coverage. Once paid, the Secretary may not seek reimbursement from the issuer if there is a finding that any relevant information provided by an individual was incorrect. A certificate is issued with respect to the costs of obtaining health insurance coverage in a year for a specified eligible individual (and family members) and may not be used for such coverage in any other period.

(2) LIMITATION- In no case shall the value of the certificate, as applied with respect to health insurance coverage, be applied towards an amount that exceeds--

(A) 70 percent of the premium for coverage for the period involved, or

(B) in the case of a certificate described in subsection (d)(2), 70 percent of the employee's premium for coverage under the group health plan involved.

(3) FORM OF CERTIFICATE- A health insurance certificate for a year shall be valued and paid as follows:

(A) VALUE- The value of the certificate for a year shall be determined based upon a methodology for determining income specified by the Secretary that is similar to that applied for purposes of determining eligibility on the basis of income under needs-based Federal programs and that may be based on the standards used under section 1612 for purposes of the supplemental security income program. Such methodology under this section may allow for use of both a Federal methodology and alternate State methodologies where the Secretary deems appropriate for ease of administration and coordination of programs. The Secretary may provide for self-certification of information by individuals where the Secretary deems appropriate for administration of the program.

(B) AVAILABILITY OF GROUP HEALTH PLAN COVERAGE- If an individual is (for the individual or for the individual's family members) eligible for coverage under a group health plan and the premium charged the individual for such coverage does not exceed 50 percent of the cost of coverage, such an individual is eligible only for a certificate under section (d)(2) and not under subsection (d)(1).

(C) MINIMUM THRESHOLD FOR ISSUANCE OF CERTIFICATE- No health insurance certificate shall be issued under this section where the annualized value of the certificate is less than $200.

(d) VALUE OF CERTIFICATE-

(1) IN GENERAL- The annualized value of a health insurance certificate for an eligible individual shall be determined as follows (and applied on a monthly basis based on 1/12 of such annualized value):

(A) UNMARRIED INDIVIDUAL WITH NO DEPENDENT FAMILY MEMBERS- Subject to subparagraph (C)(i), in the case of an eligible individual who is not married, who has no dependent family members, who has qualified health insurance coverage, and whose income--

(i) is $13,000 or less, the annualized value of the certificate is $1,000; or

(ii) exceeds $13,000, the annualized value of the certificate be equal to $1,000 minus 15 percent of such amount for every $1000 of the amount by which such income exceeds $12,001.

(B) INDIVIDUAL WITH DEPENDENT FAMILY MEMBERS- Subject to subparagraph (C)(ii), in the case of an eligible individual who has dependent family members and who has qualified health insurance coverage that covers the individual, such family members, or both, if the family's income--

(i) is $25,000 or less, the annualized value of the certificate is the sum of--

(I) $1,000, for the individual;

(II) $750, if such a family member is the individual's spouse; and

(III) $500 for each other family member, but not to exceed a total of $1,000 under this subclause; or

(ii) exceeds $25,000, the annualized value of the certificate shall be the amount determined under clause (i) minus 10 percent of such amount for each $1,000 by which such income exceeds $24,001.

Each of two eligible individuals who are married to each other may receive the appropriate amount designated for an individual, as opposed to the amount designated for a spouse, where they choose separate insurance coverage.

(C) APPLICATION OF ASSETS TEST-

(i) SELF ONLY COVERAGE- In the case of an individual described in clause (i) or (ii) of subparagraph (A) whose resources (as determined under a methodology that is similar to the methodology under section 1613 for purposes of the supplemental security income program) exceed $12,500, the annualized value of the certificate shall be 0.

(ii) SELF AND FAMILY COVERAGE- In the case of an individual described in clause (i) or (ii) of subparagraph (B) whose family resources (as determined under a methodology that is similar to the methodology under section 1613 for purposes of the supplemental security income program) exceed $20,000, the annualized value of the certificate shall be 0.

(D) ROUNDING- Any amount determined under subparagraph (A) or (B) which is not a multiple of $12 shall be rounded to the next lowest $12.

(2) CERTIFICATES FOR USE IN GROUP HEALTH PLANS- In the case of an eligible individual who is covered under a group health plan--

(A) subparagraph (C) of subsection (b)(1) shall not apply;

(B) the exclusion with respect to such coverage under subsection (e)(2)(C) shall not apply;

(C) the value of the certificate shall be 40 percent of the value determined otherwise determined under paragraph (1) (before the application of subparagraph (D) thereof); and

(D) certificates under this paragraph may be used for qualified health insurance under any group health plan available to any family member by virtue of that member's employment status.

(e) QUALIFIED HEALTH INSURANCE COVERAGE- For purposes of this section--

(1) IN GENERAL- The term `qualified health insurance coverage' means health benefits coverage (including individual health insurance coverage or coverage through a State high risk pool) that is creditable coverage (as defined in section 2701(c)(1) of the Public Health Service Act), which does not consist entirely of excepted benefits (as defined in section 2791(c) of such Act).

(2) EXCEPTION- The term `qualified health insurance coverage' does not include--

(A) a flexible spending or similar arrangement;

(B) any insurance if substantially all of its coverage is of excepted benefits described in section 9832(c) of the Internal Revenue Code of 1986;

(C) except as provided in subsection (d)(2), insurance provided through any group health plan related to employment, other than COBRA continuation coverage; or

(D) any medical program described in section 2(b)(3).

(f) AUTHORIZATION OF APPROPRIATIONS- To carry out this section and section 2745 of the Public Health Service Act (as amended by section 3), there are authorized to be appropriated such sums as may be necessary not to exceed--

(1) $28,457,000,000 for the period of fiscal years 2004 through 2008; and

(2) $49,965,000,000 for the period of fiscal years 2004 through 2013.

SEC. 3. EXTENSION OF FUNDING FOR OPERATION OF STATE HIGH RISK HEALTH INSURANCE POOLS.

Section 2745 of the Public Health Service Act, as inserted by section 201 of the Trade Act of 2002 (Public Law 107-210), is amended--

(1) in subsection (b)(1), by striking `established a qualified health risk pool that' and all that follows through the end of subparagraph (C) and inserting `established a qualified health risk pool that provides for premium rates and covered benefits for such coverage consistent with standards included in the NAIC Model Health Plan for Uninsurable Individuals';

(2) in subsection (b)(2), by striking `number of uninsured individuals' and inserting `enrollees in qualified high risk pools'; and

(3) in subsection (c)(2), by striking `$40,000,000 for each of fiscal years 2003 and 2004' and inserting `$40,000,000 for fiscal year 2003 and, subject to availability of funds under section 2(f) of the Health Insurance Certificate Act of 2003, $75,000,000 for each of fiscal years 2004 through 2009'.

END