To provide unemployed workers with health coverage assistance.

February 7, 2002

Mr. DAYTON introduced the following bill; which was read twice and referred to the Committee on Finance

To provide unemployed workers with health coverage assistance.

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 Care Assistance for America's Unemployed Workers Act of 2002'.

SEC. 2. PREMIUM ASSISTANCE FOR COBRA CONTINUATION COVERAGE FOR INDIVIDUALS AND THEIR FAMILIES.

(a) ESTABLISHMENT-

(1) IN GENERAL- Not later than 30 days after the date of enactment of this Act, the Secretary of the Treasury, in consultation with the Secretary of Labor, shall establish a program under which 75 percent of the premium for COBRA continuation coverage shall be provided for an individual who--

(A) at any time during the period that begins on January 1, 2001, and ends on December 31, 2002, is separated from employment; and

(B) is eligible for, and has elected coverage under, COBRA continuation coverage.

(2) INCLUSION OF CERTAIN INDIVIDUALS- For purposes of paragraph (1), the spouse, child, or other individual who was an insured under health insurance coverage of an individual who was killed as a result of the terrorist-related aircraft crashes on September 11, 2001, or as a result of any other terrorist-related event occurring during the period described in that paragraph, and who is eligible for, and has elected coverage under, COBRA continuation coverage shall be eligible for premium assistance under the program established under this section.

(3) STATE OPTION TO ELECT ADMINISTRATION OF PROGRAM-

(A) IN GENERAL- A State may elect to administer the premium assistance program established under this section if the State submits to the Secretary of the Treasury, not later than April 1, 2002, a plan that describes how the State will administer such program on behalf of the individuals described in paragraph (1) or (2) who reside in the State beginning on that date.

(B) STATE ENTITLEMENT- In the case of a State that submits a plan under subparagraph (A), the Secretary of the Treasury shall pay to each such State an amount for each quarter equal to the total amount of premium subsidies provided in that quarter on behalf of such individuals.

(4) IMMEDIATE IMPLEMENTATION- The program established under this section shall be implemented without regard to whether or not final regulations to carry out such program have been promulgated by the date described in paragraph (1).

(b) LIMITATION OF PERIOD OF PREMIUM ASSISTANCE-

(1) IN GENERAL- Premium assistance provided in accordance with this section shall end with respect to an individual on the earlier of--

(A) the date the individual is no longer covered under COBRA continuation coverage; or

(B) 12 months after the date the individual is first enrolled in the premium assistance program established under this section.

(2) NO ASSISTANCE AFTER MARCH 31, 2003- No premium assistance (including payment for such assistance) may be provided under this section after March 31, 2003.

(c) PAYMENT ARRANGEMENTS; CREDITING OF ASSISTANCE-

(1) PROVISION OF ASSISTANCE-

(A) IN GENERAL- Premium assistance shall be provided under the program established under this section through direct payment arrangements with a group health plan (including a multiemployer plan), an issuer of health insurance coverage, an administrator, or an employer as appropriate with respect to the individual provided such assistance.

(B) ADDITIONAL OPTION FOR STATE-RUN PROGRAM- In the case of a State that elects to administer the program established under this section, such assistance may be provided through the State public employment office or other agency responsible for administering the State unemployment compensation program.

(2) PREMIUMS PAYABLE BY INDIVIDUAL REDUCED BY AMOUNT OF ASSISTANCE- Premium assistance provided under this section shall be credited by the group health plan, issuer of health insurance coverage, or an administrator against the premium otherwise owed by the individual involved for COBRA continuation coverage.

(d) PROGRAM REQUIREMENTS- Premium assistance shall be provided under the program established under this section consistent with the following:

(1) ALL QUALIFYING INDIVIDUALS MAY APPLY- All individuals described in paragraph (1) or (2) of subsection (a) may apply for such assistance at any time during the period described in subsection (a)(1)(A).

(2) SELECTION ON FIRST-COME, FIRST-SERVED BASIS- Such assistance shall be provided to such individuals who apply for the assistance in the order in which they apply.

(e) LIMITATION ON ENTITLEMENT- Nothing in this section shall be construed as establishing any entitlement of individuals described in paragraph (1) or (2) of subsection (a) to premium assistance under this section.

(f) DISREGARD OF SUBSIDIES FOR PURPOSES OF FEDERAL AND STATE PROGRAMS- Notwithstanding any other provision of law, any premium assistance provided to, or on behalf of, an individual under this section, shall not be considered income or resources in determining eligibility for, or the amount of assistance or benefits provided under, any other Federal public benefit or State or local public benefit.

(g) CHANGE IN COBRA NOTICE-

(1) GENERAL NOTICE-

(A) IN GENERAL- In the case of notices provided under section 4980B(f)(6) of the Internal Revenue Code of 1986, section 2206 of the Public Health Service Act (42 U.S.C. 300bb-6), section 606 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1166), or section 8905a(f)(2)(A) of title 5, United States Code, with respect to individuals who, during the period described in subsection (a)(1)(A), become entitled to elect COBRA continuation coverage, such notices shall include an additional notification to the recipient of the availability of premium assistance for such coverage under this section and for temporary medicaid assistance under section 4 for the remaining portion of COBRA continuation premiums.

(B) ALTERNATIVE NOTICE- In the case of COBRA continuation coverage to which the notice provision under such sections does not apply, the Secretary of the Treasury, in consultation with the Secretary of Labor, shall, in coordination with administrators of the group health plans (or other entities) that provide or administer the COBRA continuation coverage involved, assure the provision of such notice.

(C) FORM- The requirement of the additional notification under this paragraph may be met by amendment of existing notice forms or by inclusion of a separate document with the notice otherwise required.

(2) SPECIFIC REQUIREMENTS- Each additional notification under paragraph (1) shall include--

(A) the forms necessary for establishing eligibility and enrollment in the premium assistance program established under this section in connection with the coverage with respect to each covered employee or other qualified beneficiary;

(B) the name, address, and telephone number necessary to contact the administrator and any other person maintaining relevant information in connection with the premium assistance; and

(C) the following statement displayed in a prominent manner:

`You may be eligible to receive assistance with payment of 75 percent of your COBRA continuation coverage premiums and with temporary medicaid coverage for the remaining premium portion for a duration of not to exceed 12 months.'.

(3) NOTICE RELATING TO RETROACTIVE COVERAGE- In the case of such notices previously transmitted before the date of enactment of this Act in the case of an individual described in paragraph (1) who has elected (or is still eligible to elect, including as a result of subsection (h)) COBRA continuation coverage as of the date of enactment of this Act, the administrator of the group health plan (or other entity) involved or the Secretary of the Treasury, in consultation with the Secretary of Labor, (in the case described in the paragraph (1)(B)) shall provide (within 60 days after the date of enactment of this Act) for the additional notification required to be provided under paragraph (1).

(4) MODEL NOTICES- Not later than 30 days after the date of enactment of this Act, the Secretary of the Treasury shall prescribe models for the additional notification required under this subsection.

(h) TEMPORARY EXTENSION OF ELECTION PERIOD FOR CERTAIN SEPARATED INDIVIDUALS-

(1) IN GENERAL- Notwithstanding any other provision of law, the election period for COBRA continuation coverage with respect to any eligible worker for whom such period has expired as of the date of enactment of this Act, shall not end before the date that is 60 days after the date the individual receives the additional notice required under subsection (g)(3).

(2) PREEXISTING CONDITIONS- If an individual is entitled to an additional notice under subsection (g)(3), any period before the receipt of such notice shall be disregarded for purposes of determining the 63-day periods referred to in section 701(c)(2) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1181(c)(2)), section 2701(c)(2) of the Public Health Service Act (42 U.S.C. 300gg(c)(2)), and section 9801(c)(2) of the Internal Revenue Code of 1986.

(i) REPORTS- Beginning on the date that is 3 months after the date of enactment of this Act, and every 3 months thereafter until January 1, 2003, the Secretary of the Treasury shall submit a report to Congress regarding the premium assistance program established under this section that includes the following:

(1) The status of the implementation of the program.

(2) The number of individuals provided assistance under the program as of the date of the report.

(3) The average dollar amount (monthly and annually) of the premium assistance provided under the program.

(4) The number and identification of the States that have elected to administer the program.

(5) The total amount of expenditures incurred (with administrative expenditures noted separately) under the program as of the date of the report.

(j) APPROPRIATION-

(1) IN GENERAL- Out of any funds in the Treasury not otherwise appropriated, there is appropriated to carry out this section, such sums as are necessary for each of fiscal years 2002 and 2003.

(2) OBLIGATION OF FUNDS- This section constitutes budget authority in advance of appropriations Acts and represents the obligation of the Federal Government to provide for the payment of premium assistance under this section.

(k) SUNSET- No premium assistance (including payment for such assistance) may be provided under this section after March 31, 2003.

SEC. 3. STATE OPTION TO PROVIDE TEMPORARY MEDICAID COVERAGE FOR CERTAIN UNINSURED INDIVIDUALS.

(a) STATE OPTION- Notwithstanding any other provision of law, a State may elect to provide under its medicaid program under title XIX of the Social Security Act medical assistance in the case of an individual--

(1) who at any time during the period that begins on January 1, 2001, and ends on December 31, 2002, is separated from employment;

(2) who is not eligible for COBRA continuation coverage;

(3) who is uninsured; and

(4) whose assets, resources, and earned or unearned income (or both) do not exceed such limitations (if any) as the State may establish.

(b) LIMITATION OF PERIOD OF COVERAGE- Medical assistance provided in accordance with this section shall end with respect to an individual on the earlier of--

(1) the date the individual is no longer uninsured; or

(2) subject to subsection (c)(4), 12 months after the date the individual first receives such assistance.

(c) SPECIAL RULES- In the case of medical assistance provided under this section--

(1) the Federal medical assistance percentage under section 1905(b) of the Social Security Act (42 U.S.C. 1396d(b)) shall be the enhanced FMAP (as defined in section 2105(b) of such Act (42 U.S.C. 1397ee(b)));

(2) a State may elect to apply any income, asset, or resource limitation permitted under the State medicaid plan or under title XIX of such Act;

(3) the provisions of section 1916(g) of the Social Security Act (42 U.S.C. 1396o) shall apply to the provision of such assistance in the same manner as the provisions of such section apply with respect to individuals provided medical assistance only under subclause (XV) or (XVI) of section 1902(a)(10)(A)(ii) of such Act (42 U.S.C. 1396a(a)(10)(A)(ii));

(4) a State may elect to provide such assistance in accordance with section 1902(a)(34) of the Social Security Act (42 U.S.C. 1396a(a)(34)) and any assistance provided with respect to a month described in that section shall not be included in the determination of the 12-month period under subsection (b)(2);

(5) a State may elect to make eligible for such medical assistance a dependent spouse or children of an individual eligible for medical assistance under subsection (a), if such spouse or children are uninsured;

(6) individuals eligible for medical assistance under this section shall be deemed to be described in the list of individuals described in the matter preceding paragraph (1) of section 1905(a) of such Act (42 U.S.C. 1396d(a));

(7) a State may elect to provide such medical assistance without regard to any limitation under sections 401(a), 402(b), 403, and 421 of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (8 U.S.C. 1611(a), 1612(b), 1613, and 1631) and no debt shall accrue under an affidavit of support against any sponsor of an individual who is an alien who is provided such assistance, and the cost of such assistance shall not be considered as an unreimbursed cost; and

(8) the Secretary of Health and Human Services shall not count, for purposes of section 1108(f) of the Social Security Act (42 U.S.C. 1308(f)), such amount of payments under this section as bears a reasonable relationship to the average national proportion of payments made under this section for the 50 States and the District of Columbia to the payments otherwise made under title XIX for such States and District.

(d) SUNSET- No medical assistance may be provided under this section after March 31, 2003.

SEC. 4. STATE OPTION TO PROVIDE TEMPORARY COVERAGE UNDER MEDICAID FOR THE UNSUBSIDIZED PORTION OF COBRA CONTINUATION PREMIUMS.

(a) STATE OPTION-

(1) IN GENERAL- Notwithstanding any other provision of law, a State may elect to provide under

its medicaid program under title XIX of the Social Security Act medical assistance in the form of payment for the portion of the premium for COBRA continuation coverage for which an individual does not receive a subsidy under the premium assistance program established under section 2 in the case of an individual--

(A) who at any time during the period that begins on January 1, 2001, and ends on December 31, 2002, is separated from employment;

(B) who is eligible for, and has elected coverage under, COBRA continuation coverage;

(C) who is receiving premium assistance under the program established under section 2; and

(D) whose family income does not exceed 200 percent of the poverty line.

(2) INCLUSION OF CERTAIN INDIVIDUALS- For purposes of paragraph (1), the spouse, child, or other individual who was an insured under health insurance coverage of an individual who was killed as a result of the terrorist-related aircraft crashes on September 11, 2001, or as a result of any other terrorist-related event occurring during the period described in that paragraph, and who satisfies the requirements of subparagraphs (B), (C), and (D) of paragraph (1) shall be eligible for medical assistance under this section.

(b) LIMITATION OF PERIOD OF COVERAGE- Medical assistance provided in accordance with this section shall end with respect to an individual on the earlier of--

(1) the date the individual is no longer covered under COBRA continuation coverage; or

(2) 12 months after the date the individual first receives such assistance under this section.

(c) SPECIAL RULES- In the case of medical assistance provided under this section--

(1) such assistance may be provided without regard to--

(A) whether the State otherwise has elected to make medical assistance available for COBRA premiums under section 1902(a)(10)(F) of the Social Security Act (42 U.S.C. 1396a(a)(10)(F)); or

(B) the conditions otherwise imposed for the provision of medical assistance for such COBRA premiums under clause (XII) of the matter following section 1902(a)(10)(G) of the Social Security Act (42 U.S.C. 1396a(a)(10)(G)), or paragraphs (1)(B), (1)(C), (1)(D), and (4) of section 1902(u) of such Act (42 U.S.C. 1396a(u)); and

(2) paragraphs (1), (2), (4), (5), (7), and (8) of subsection (c) of section 3 apply to such assistance in the same manner as such paragraphs apply to the provision of medical assistance under that section.

(d) SUNSET- No medical assistance may be provided under this section after March 31, 2003.

SEC. 5. DEFINITIONS.

In this Act:

(1) ADMINISTRATOR- The term `administrator' has the meaning given that term in section 3(16)(A) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002(16)(A)).

(2) COBRA CONTINUATION COVERAGE-

(A) IN GENERAL- The term `COBRA continuation coverage' means coverage under a group health plan provided by an employer pursuant to title XXII of the Public Health Service Act, section 4980B of the Internal Revenue Code of 1986, part 6 of subtitle B of title I of the Employee Retirement Income Security Act of 1974, or section 8905a of title 5, United States Code.

(B) APPLICATION TO EMPLOYERS IN STATES REQUIRING SUCH COVERAGE- Such term includes such coverage provided by an employer in a State that has enacted a law that requires the employer to provide such coverage even though the employer would not otherwise be required to provide such coverage under the provisions of law referred to in subparagraph (A).

(3) COVERED EMPLOYEE- The term `covered employee' has the meaning given that term in section 607(2) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1167(2)).

(4) FEDERAL PUBLIC BENEFIT- The term `Federal public benefit' has the meaning given that term in section 401(c) of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (8 U.S.C. 1611(c)).

(5) GROUP HEALTH PLAN- The term `group health plan' has the meaning given that term in section 2791(a) of the Public Health Service Act (42 U.S.C. 300gg-91(a)) and in section 607(1) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1167(1)).

(6) HEALTH INSURANCE COVERAGE- The term `health insurance coverage' has the meaning given that term in section 2791(b)(1) of the Public Health Service Act (42 U.S.C. 300gg-91(b)(1)).

(7) MULTIEMPLOYER PLAN- The term `multiemployer plan' has the meaning given that term in section 3(37) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002(37)).

(8) POVERTY LINE- The term `poverty line' has the meaning given that term in section 2110(c)(5) of the Social Security Act (42 U.S.C. 1397jj(c)(5)).

(9) QUALIFIED BENEFICIARY- The term `qualified beneficiary' has the meaning given that term in section 607(3) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1167(3)).

(10) STATE- The term `State' has the meaning given such term for purposes of title XIX of the Social Security Act (42 U.S.C. 1396 et seq.).

(11) STATE OR LOCAL PUBLIC BENEFIT- The term `State or local public benefit' has the meaning given that term in section 411(c) of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (8 U.S.C. 1621(c)).

(12) UNINSURED-

(A) IN GENERAL- The term `uninsured' means, with respect to an individual, that the individual is not covered under--

(i) a group health plan;

(ii) health insurance coverage; or

(iii) a program under title XVIII, XIX, or XXI of the Social Security Act (other than under such title XIX pursuant to section 3).

(B) EXCLUSION- Such coverage under clause (i) or (ii) shall not include coverage consisting solely of coverage of excepted benefits (as defined in section 2791(c) of the Public Health Service Act (42 U.S.C. 300gg-91(c)).

END