108th CONGRESS
2d Session
S. 2935
To amend section 35 of the Internal Revenue Code of 1986 to improve
the health coverage tax credit, and for other purposes.
IN THE SENATE OF THE UNITED STATES
October 7, 2004
Mr. ROCKEFELLER introduced the following bill; which was read twice and referred
to the Committee on Finance
A BILL
To amend section 35 of the Internal Revenue Code of 1986 to improve
the health coverage tax credit, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE- This Act may be cited as the `TAA Health Coverage Improvement
Act of 2004'.
(b) TABLE OF CONTENTS- The table of contents for this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Improvement of the affordability of the credit.
Sec. 3. 100 percent credit and payment for monthly premiums paid prior to
certification of eligibility for the credit.
Sec. 4. Eligibility for certain pension plan participants; presumptive eligibility.
Sec. 5. Clarification of 3-month creditable coverage requirement.
Sec. 6. TAA pre-certification period rule for purposes of determining whether
there is a 63-day lapse in creditable coverage.
Sec. 7. Continued qualification of family members after certain events.
Sec. 8. Offering of Federal group coverage.
Sec. 9. Additional requirements for individual health insurance costs.
Sec. 10. Alignment of COBRA coverage with TAA period for TAA-eligible individuals.
Sec. 11. Notice requirements.
Sec. 12. Annual report on enhanced TAA benefits.
Sec. 13. Extension of national emergency grants.
Sec. 14. Extension of funding for operation of State high risk health insurance
pools.
SEC. 2. IMPROVEMENT OF THE AFFORDABILITY OF THE CREDIT.
(a) IMPROVEMENT OF AFFORDABILITY-
(1) IN GENERAL- Section 35(a) of the Internal Revenue Code of 1986 (relating
to credit for health insurance costs of eligible individuals) is amended
by striking `65' and inserting `95'.
(2) CONFORMING AMENDMENT- Section 7527(b) of such Code (relating to advance
payment of credit for health insurance costs of eligible individuals) is
amended by striking `65' and inserting `95'.
(b) EFFECTIVE DATE- The amendments made by this section apply to taxable years
beginning after December 31, 2004.
SEC. 3. 100 PERCENT CREDIT AND PAYMENT FOR MONTHLY PREMIUMS PAID PRIOR TO
CERTIFICATION OF ELIGIBILITY FOR THE CREDIT.
(a) IN GENERAL- Subsection (a) of section 35 of the Internal Revenue Code
of 1986, as amended by section 2(a)(1), is amended--
(1) by striking the subsection heading and all that follows through `In
case' and inserting `AMOUNT OF CREDIT-
`(1) IN GENERAL- In case'; and
(2) by adding at the end the following new paragraph:
`(2) 100 PERCENT CREDIT FOR MONTHS PRIOR TO ISSUANCE OF ELIGIBILITY CERTIFICATE-
The amount allowed as a credit against the tax imposed by subtitle A shall
be equal to 100 percent in the case of the taxpayer's first eligible coverage
months occurring prior to the issuance of a qualified health insurance costs
credit eligibility certificate.'.
(b) PAYMENT FOR PREMIUMS DUE PRIOR TO CERTIFICATION OF ELIGIBILITY FOR THE
CREDIT- Section 7527 of the Internal Revenue Code of 1986 (relating to advance
payment of credit for health insurance costs of eligible individuals) is amended
by adding at the end the following new subsection:
`(e) PAYMENT FOR PREMIUMS DUE PRIOR TO ISSUANCE OF CERTIFICATE- The program
established under subsection (a) shall provide--
`(1) that the Secretary shall make payments on behalf of a certified individual
of an amount equal to 100 percent of the premiums for coverage of the taxpayer
and qualifying family members under qualified health insurance for eligible
coverage months (as defined in section 35(b)) occurring prior to the issuance
of a qualified health insurance costs credit eligibility certificate; and
`(2) that any payments made under paragraph (1) shall not be included in
the gross income of the taxpayer on whose behalf such payments were made.'.
(c) EFFECTIVE DATE- The amendments made by this section shall apply to months
beginning after the date of the enactment of this Act in taxable years ending
after such date.
SEC. 4. ELIGIBILITY FOR CERTAIN PENSION PLAN RECIPIENTS; PRESUMPTIVE ELIGIBILITY.
(a) ELIGIBILITY FOR CERTAIN PENSION PLAN RECIPIENTS- Subsection (c) of section
35 of the Internal Revenue Code of 1986 is amended--
(A) in subparagraph (B), by striking `and' at the end;
(B) in subparagraph (C), by striking the period and inserting `, and';
and
(C) by adding at the end the following:
`(D) an eligible multiemployer pension participant.'; and
(2) by adding at the end the following new paragraph:
`(5) ELIGIBLE MULTIEMPLOYER PENSION RECIPIENT- The term `eligible multiemployer
pension recipient' means, with respect to any month, any individual--
`(A) who has attained age 55 as of the first day of such month,
`(B) who is receiving a benefit from a multiemployer plan (as defined
in section 3(37)(A) of the Employee Retirement Income Security Act of
1974), and
`(C) whose former employer has withdrawn from such multiemployer plan
pursuant to section 4203(a) of such Act.'.
(b) PRESUMPTIVE ELIGIBILITY FOR PETITIONERS FOR TRADE ADJUSTMENT ASSISTANCE-
Subsection (c) of section 35 of the Internal Revenue Code of 1986, as amended
by subsection (a), is amended by adding at the end the following new paragraph:
`(6) PRESUMPTIVE STATUS AS A TAA RECIPIENT- The term `eligible individual'
shall include any individual who is covered by a petition filed with the
Secretary of Labor under section 221 of the Trade Act of 1974. This paragraph
shall apply to any individual only with respect to months which--
`(A) end after the date that such petition is so filed, and
`(B) begin before the earlier of--
`(i) the 90th day after the date of filing of such petition, or
`(ii) the date on which the Secretary of Labor makes a final determination
with respect to such petition.'.
(c) CONFORMING AMENDMENTS-
(1) Paragraph (1) of section 7527(d) of such Code is amended by striking
`or an eligible alternative TAA recipient (as defined in section 35(c)(3))'
and inserting `, an eligible alternative TAA recipient (as defined in section
35(c)(3)), an eligible multiemployer pension recipient (as defined in section
35(c)(5), or an individual who is an eligible individual by reason of section
35(c)(6)'.
(2) Section 173(f)(4) of the Workforce Investment Act of 1998 (29 U.S.C.
2918(f)(4)) is amended--
(A) in subparagraph (B), by striking `and' at the end;
(B) in subparagraph (C), by striking the period and inserting a comma;
and
(C) by inserting after subparagraph (C), the following new subparagraphs:
`(D) an eligible multiemployer pension recipient (as defined in section
35(c)(5) of the Internal Revenue Code of 1986), and
`(E) an individual who is an eligible individual by reason of section
35(c)(6) of the Internal Revenue Code of 1986.'.
(d) TECHNICAL AMENDMENT CLARIFYING ELIGIBILITY OF CERTAIN DISPLACED WORKERS
RECEIVING A BENEFIT UNDER A DEFINED BENEFIT PENSION PLAN- The first sentence
of section 35(c)(2) of the Internal Revenue Code of 1986 is amended by inserting
before the period the following: `, and shall include any such individual
who would be eligible to receive such an allowance but for the fact that the
individual is receiving a benefit under a defined benefit plan (as defined
in section 3(35) of the Employee Retirement Income Security Act of 1974).'.
(e) EFFECTIVE DATE- The amendments made by this section shall apply to months
beginning after the date of the enactment of this Act in taxable years ending
after such date.
SEC. 5. CLARIFICATION OF 3-MONTH CREDITABLE COVERAGE REQUIREMENT.
(a) IN GENERAL- Clause (i) of section 35(e)(2)(B) of the Internal Revenue
Code of 1986 (defining qualifying individual) is amended by inserting `(prior
to the employment separation necessary to attain the status of an eligible
individual)' after `9801(c)'.
(b) CONFORMING AMENDMENT- Section 173(f)(2)(B)(ii)(I) of the Workforce Investment
Act of 1998 (29 U.S.C. 2918(f)(2)(B)(ii)(I)) is amended by inserting `(prior
to the employment separation necessary to attain the status of an eligible
individual)' after `1986'.
(c) EFFECTIVE DATE- The amendments made by this section shall apply to months
beginning after the date of the enactment of this Act in taxable years ending
after such date.
SEC. 6. TAA PRE-CERTIFICATION PERIOD RULE FOR PURPOSES OF DETERMINING WHETHER
THERE IS A 63-DAY LAPSE IN CREDITABLE COVERAGE.
(a) ERISA AMENDMENT- Section 701(c)(2) of the Employee Retirement Income Security
Act of 1974 (29 U.S.C. 1181(c)(2)) is amended by adding at the end the following
new subparagraph:
`(C) TAA-ELIGIBLE INDIVIDUALS-
`(i) TAA PRE-CERTIFICATION PERIOD RULE- In the case of a TAA-eligible
individual, the period beginning on the date the individual has a TAA-related
loss of coverage and ending on the date that is 5 days after the postmark
date of the notice by the Secretary (or by any person or entity designated
by the Secretary) that the individual is eligible for a qualified health
insurance costs credit eligibility certificate for purposes of section
7527 of the Internal Revenue Code of 1986 shall not be taken into account
in determining the continuous period under subparagraph (A).
`(ii) DEFINITIONS- The terms `TAA-eligible individual', and `TAA-related
loss of coverage' have the meanings given such terms in section 605(b)(4)(C).'.
(b) PHSA AMENDMENT- Section 2701(c)(2) of the Public Health Service Act (42
U.S.C. 300gg(c)(2)) is amended by adding at the end the following new subparagraph:
`(C) TAA-ELIGIBLE INDIVIDUALS-
`(i) TAA PRE-CERTIFICATION PERIOD RULE- In the case of a TAA-eligible
individual, the period beginning on the date the individual has a TAA-related
loss of coverage and ending on the date that is 5 days after the postmark
date of the notice by the Secretary (or by any person or entity designated
by the Secretary) that the individual is eligible for a qualified health
insurance costs credit eligibility certificate for purposes of section
7527 of the Internal Revenue Code of 1986 shall not be taken into account
in determining the continuous period under subparagraph (A).
`(ii) DEFINITIONS- The terms `TAA-eligible individual', and `TAA-related
loss of coverage' have the meanings given such terms in section 2205(b)(4)(C).'.
(c) IRC AMENDMENT- Section 9801(c)(2) of the Internal Revenue Code of 1986
(relating to not counting periods before significant breaks in creditable
coverage) is amended by adding at the end the following new subparagraph:
`(D) TAA-ELIGIBLE INDIVIDUALS-
`(i) TAA PRE-CERTIFICATION PERIOD RULE- In the case of a TAA-eligible
individual, the period beginning on the date the individual has a TAA-related
loss of coverage and ending on the date which is 5 days after the postmark
date of the notice by the Secretary (or by any person or entity designated
by the Secretary) that the individual is eligible for a qualified health
insurance costs credit eligibility certificate for purposes of section
7527 shall not be taken into account in determining the continuous period
under subparagraph (A).
`(ii) DEFINITIONS- The terms `TAA-eligible individual', and `TAA-related
loss of coverage' have the meanings given such terms in section 4980B(f)(5)(C)(iv).'.
(d) EFFECTIVE DATE- The amendments made by this section shall apply to months
beginning after the date of the enactment of this Act in taxable years ending
after such date.
SEC. 7. CONTINUED QUALIFICATION OF FAMILY MEMBERS AFTER CERTAIN EVENTS.
(a) IN GENERAL- Subsection (g) of section 35 of the Internal Revenue Code
of 1986 is amended by redesignating paragraph (9) as paragraph (10) and inserting
after paragraph (8) the following new paragraph:
`(9) CONTINUED QUALIFICATION OF FAMILY MEMBERS AFTER CERTAIN EVENTS-
`(A) ELIGIBLE INDIVIDUAL BECOMES MEDICARE ELIGIBLE- In the case of a month
which would be an eligible coverage month with respect to an eligible
individual but for subsection (f)(2)(A), such month shall be treated as
an eligible coverage month with respect to any qualifying family member
of such eligible individual (but not with respect to such eligible individual).
`(B) DIVORCE- In the case of a month which would be an eligible coverage
month with respect to a former spouse of a taxpayer but for the finalization
of a divorce between the spouse and the taxpayer that occurs during the
period in which the taxpayer is an eligible individual,
such month shall be treated as an eligible coverage month with respect to
such former spouse.
`(C) DEATH- In the case of a month which would be an eligible coverage
month with respect to an eligible individual but for the death of such
individual, such month shall be treated as an eligible coverage month
with respect to any qualifying family of such eligible individual.'.
(b) CONFORMING AMENDMENT- Section 173(f) of the Workforce Investment Act of
1998 (29 U.S.C. 2918(f)) is amended by adding at the end the following:
`(8) CONTINUED QUALIFICATION OF FAMILY MEMBERS AFTER CERTAIN EVENTS-
`(A) ELIGIBLE INDIVIDUAL BECOMES MEDICARE ELIGIBLE- In the case of a month
which would be an eligible coverage month with respect to an eligible
individual but for subsection (f)(2)(A), such month shall be treated as
an eligible coverage month with respect to any qualifying family member
of such eligible individual (but not with respect to such eligible individual).
`(B) DIVORCE- In the case of a month which would be an eligible coverage
month with respect to a former spouse of a taxpayer but for the finalization
of a divorce between the spouse and the taxpayer that occurs during the
period in which the taxpayer is an eligible individual, such month shall
be treated as an eligible coverage month with respect to such former spouse.
`(C) DEATH- In the case of a month which would be an eligible coverage
month with respect to an eligible individual but for the death of such
individual, such month shall be treated as an eligible coverage month
with respect to any qualifying family of such eligible individual.'.
(c) EFFECTIVE DATE- The amendments made by this section shall apply to months
beginning after the date of the enactment of this Act in taxable years ending
after such date.
SEC. 8. OFFERING OF FEDERAL GROUP COVERAGE.
(a) PROVISION OF GROUP COVERAGE-
(1) IN GENERAL- The Director of the Office of Personnel Management jointly
with the Secretary of the Treasury shall establish a program under which
eligible individuals (as defined in section 35(c) of the Internal Revenue
Code of 1986) are offered enrollment under health benefit plans that are
made available under FEHBP.
(2) TERMS AND CONDITIONS- The terms and conditions of health benefits plans
offered under paragraph (1) shall be the same as the terms and coverage
offered under FEHBP, except that the percentage of the premium charged to
eligible individuals (as so defined) for such health benefit plans shall
be equal to 5 percent.
(3) STUDY- The Director of the Office of Personnel Management jointly with
the Secretary of the Treasury shall conduct a study of the impact of the
offering of health benefit plans under this subsection on the terms and
conditions, including premiums, for health benefit plans offered under FEHBP
and shall submit to Congress, not later than 2 years after the date of the
enactment of this Act, a report on such study. Such report may contain such
recommendations regarding the establishment of separate risk pools for individuals
covered under FEHBP and eligible individuals covered under health benefit
plans offered under paragraph (1) as may be appropriate to protect the interests
of individuals covered under FEHBP and alleviate any adverse impact on FEHBP
that may result from the offering of such health benefit plans.
(4) FEHBP DEFINED- In this section, the term `FEHBP' means the Federal Employees
Health Benefits Program offered under chapter 89 of title 5, United States
Code.
(b) CONFORMING AMENDMENTS-
(1) Paragraph (1) of section 35(e) of the Internal Revenue Code of 1986
is amended by adding at the end the following new subparagraph:
`(K) Coverage under a health benefits plan offered under section 8(a)(1)
of the TAA Health Care Tax Credit Improvement Act of 2004.'.
(2) Section 173(f)(2)(A) of the Workforce Investment Act of 1998 (29 U.S.C.
2918(f)(2)(A)) is amended by adding at the end the following new clause:
`(xi) Coverage under a health benefits plan offered under section 8(a)(1)
of the TAA Health Care Tax Credit Improvement Act of 2004.'.
SEC. 9. ADDITIONAL REQUIREMENTS FOR INDIVIDUAL HEALTH INSURANCE COSTS.
(a) IN GENERAL- Subparagraph (A) of section 35(e)(2) of such Code is amended
by striking `subparagraphs (B) through (H) of paragraph (1)' and inserting
`paragraph (1) (other than subparagraphs (A), (I), and (K) thereof)'.
(b) RATING SYSTEM REQUIREMENT- Subparagraph (J) of section 35(e)(1) of such
Code is amended by adding at the end the following: `For purposes of this
subparagraph and clauses (ii), (iii), and (iv) of subparagraph (F), such term
does not include any insurance unless the premiums for such insurance are
restricted based on a community rating system (determined other than on the
basis of age).'.
(c) CLARIFICATION OF CONGRESSIONAL INTENT TO LIMIT USE OF INDIVIDUAL HEALTH
INSURANCE COVERAGE OPTION- Section 35(e)(1)(J) (relating to qualified health
insurance) is amended in the matter preceding clause (i), by inserting `,
but only' after `under individual health insurance'.
(d) CONFORMING AMENDMENTS- Section 173(f)(2) of the Workforce Investment Act
of 1998 (29 U.S.C. 2918(f)(2)) is amended--
(1) in subparagraph (A)(x), by adding at the end the following: `Such term
does not include any insurance unless the premiums for such insurance are
restricted based on a community rating system (determined other than on
the basis of age).'; and
(2) in subparagraph (B)--
(A) in the matter preceding subclause (I), by inserting `, but only' after
`under individual health insurance'; and
(B) in clause (i), by striking `clauses (ii) through (viii) of subparagraph
(A)' and inserting `subparagraph (A) (other than clauses (i), (x), and
(xi) thereof)'.
SEC. 10. ALIGNMENT OF COBRA COVERAGE WITH TAA PERIOD FOR TAA-ELIGIBLE INDIVIDUALS.
(a) ERISA- Section 605(b) of the Employee Retirement Income Security Act of
1974 (29 U.S.C. 1165(b)) is amended--
(1) in the subsection heading, by inserting `AND COVERAGE' after `ELECTION';
and
(A) in the paragraph heading, by inserting `AND PERIOD' after `COMMENCEMENT';
(B) by striking `and shall' and inserting `, shall'; and
(C) by inserting `, and in no event shall the maximum period required
under section 602(2)(A) be less than the period during which the individual
is a TAA-eligible individual' before the period at the end.
(b) INTERNAL REVENUE CODE OF 1986- Section 4980B(f)(5)(C) of the Internal
Revenue Code of 1986 is amended--
(1) in the subparagraph heading, by inserting `AND COVERAGE' after `ELECTION';
and
(A) in the clause heading, by inserting `AND PERIOD' after `COMMENCEMENT';
(B) by striking `and shall' and inserting `, shall'; and
(C) by inserting `, and in no event shall the maximum period required
under paragraph (2)(B)(i) be less than the period during which the individual
is a TAA-eligible individual' before the period at the end.
(c) PUBLIC HEALTH SERVICE ACT- Section 2205(b) of the Public Health Service
Act (42 U.S.C. 300bb-5(b)) is amended--
(1) in the subsection heading, by inserting `AND COVERAGE' after `ELECTION';
and
(A) in the paragraph heading, by inserting `AND PERIOD' after `COMMENCEMENT';
(B) by striking `and shall' and inserting `, shall'; and
(C) by inserting `, and in no event shall the maximum period required
under section 2202(2)(A) be less than the period during which the individual
is a TAA-eligible individual' before the period at the end.
SEC. 11. NOTICE REQUIREMENTS.
Section 7527 of the Internal Revenue Code of 1986 (relating to advance payment
of credit for health insurance costs of eligible individuals), as amended
by section 3(b), is amended by adding at the end the following new subsection:
`(f) INCLUSION OF CERTAIN INFORMATION- The notice by the Secretary (or by
any person or entity designated by the Secretary) that an individual is eligible
for a qualified health insurance costs credit eligibility certificate shall
include--
`(1) the name, address, and telephone number of the State office or offices
responsible for determining that the individual is eligible for such certificate
and for providing the individual with assistance with enrollment
in qualified health insurance (as defined in section 35(e)),
`(2) a list of the coverage options that are treated as qualified health
insurance (as so defined) by the State in which the individual resides,
and
`(3) in the case of a TAA-eligible individual (as defined in section 4980B(f)(5)(C)(iv)(II)),
a statement informing the individual that the individual has 63 days from
the date that is 5 days after the postmark date of such notice to enroll
in such insurance without a lapse in creditable coverage (as defined in
section 9801(c)).'.
SEC. 12. ANNUAL REPORT ON ENHANCED TAA BENEFITS.
Not later than October 1 of each year (beginning in 2004) the Secretary of
the Treasury, after consultation with the Secretary of Labor, shall report
to the Committee on Finance and the Committee on Health, Education, Labor,
and Pensions of the Senate and the Committee on Ways and Means and the Committee
on Education and the Workforce of the House of Representatives the following
information with respect to the most recent taxable year ending before such
date:
(1) The total number of participants utilizing the health insurance tax
credit under section 35 of the Internal Revenue Code of 1986, including
a measurement of such participants identified--
(B) by coverage under COBRA continuation provisions (as defined in section
9832(d)(1) of such Code) and by non-COBRA coverage (further identified
by group and individual market).
(2) The range of monthly health insurance premiums offered and the average
and median monthly health insurance premiums offered to TAA-eligible individuals
(as defined in section 4980B(f)(5)(C)(iv)(II) of such Code) under COBRA
continuation provisions (as defined in section 9832(d)(1) of such Code),
State-based continuation coverage provided under a State law that requires
such coverage, and each category of coverage described in section 35(e)(1)
of such Code, identified by State and by the actuarial value of such coverage
and the specific benefits provided and cost-sharing imposed under such coverage.
(3) The number of States applying for and receiving national emergency grants
under section 173(f) of the Workforce Investment Act of 1998 (29 U.S.C.
2918(f)) and the time necessary for application approval of such grants.
(4) The cost of administering the health credit program under section 35
of such Code, by function, including the cost of subcontractors.
SEC. 13. EXTENSION OF NATIONAL EMERGENCY GRANTS.
(a) IN GENERAL- Section 173(f) of the Workforce Investment Act of 1998 (29
U.S.C. 2918(f)) is amended--
(1) by striking paragraph (1) and inserting the following new paragraph:
`(A) HEALTH INSURANCE COVERAGE FOR ELIGIBLE INDIVIDUALS IN ORDER TO OBTAIN
QUALIFIED HEALTH INSURANCE THAT HAS GUARANTEED ISSUE AND OTHER CONSUMER
PROTECTIONS- Funds made available to a State or entity under paragraph
(4)(A) of subsection (a) shall be used to provide an eligible individual
described in paragraph (4)(C) and such individual's qualifying family
members with health insurance coverage for the 3-month period that immediately
precedes the first eligible coverage month (as defined in section 35(b)
of the Internal Revenue Code of 1986) in which such eligible individual
and such individual's qualifying family members are covered by qualified
health insurance that meets the requirements described in clauses (i)
through (iv) of section 35(e)(2)(A) of the Internal Revenue Code of 1986
(or such longer minimum period as is necessary in order for such eligible
individual and such individual's qualifying family members to be covered
by qualified health insurance that meets such requirements).
`(B) ADDITIONAL USES- Funds made available to a State or entity under
paragraph (4)(A) of subsection (a) may be used by the State or entity
for the following:
`(i) HEALTH INSURANCE COVERAGE- To assist an eligible individual and
such individual's qualifying family members with enrolling in health
insurance coverage and qualified health insurance or paying premiums
for such coverage or insurance.
`(ii) ADMINISTRATIVE EXPENSES AND START-UP EXPENSES TO ESTABLISH GROUP
HEALTH PLAN COVERAGE OPTIONS FOR QUALIFIED HEALTH INSURANCE- To pay
the administrative expenses related to
the enrollment of eligible individuals and such individuals' qualifying family
members in health insurance coverage and qualified health insurance, including--
`(I) eligibility verification activities;
`(II) the notification of eligible individuals of available health
insurance and qualified health insurance options;
`(III) processing qualified health insurance costs credit eligibility
certificates provided for under section 7527 of the Internal Revenue
Code of 1986;
`(IV) providing assistance to eligible individuals in enrolling in
health insurance coverage and qualified health insurance;
`(V) the development or installation of necessary data management
systems; and
`(VI) any other expenses determined appropriate by the Secretary,
including start-up costs and on going administrative expenses, in
order for the State to treat the coverage described in subparagraph
(C), (D), (E), or (F)(i) of section 35(e)(1) of the Internal Revenue
Code of 1986, or, only if the coverage is under a group health plan,
the coverage described in subparagraph (F)(ii), (F)(iii), (F)(iv),
(G), or (H) of such section, as qualified health insurance under that
section.
`(iii) OUTREACH- To pay for outreach to eligible individuals to inform
such individuals of available health insurance and qualified health
insurance options, including outreach consisting of notice to eligible
individuals of such options made available after the date of enactment
of this clause and direct assistance to help potentially eligible individuals
and such individual's qualifying family members qualify and remain eligible
for the credit established under section 35 of the Internal Revenue
Code of 1986 and advance payment of such credit under section 7527 of
such Code.
`(iv) BRIDGE FUNDING- To assist potentially eligible individuals purchase
qualified health insurance coverage prior to issuance of a qualified
health insurance costs credit eligibility certificate under section
7527 of the Internal Revenue Code of 1986 and commencement of advance
payment, and receipt of expedited payment, under subsections (a) and
(e), respectively, of that section.
`(C) RULE OF CONSTRUCTION- The inclusion of a permitted use under this
paragraph shall not be construed as prohibiting a similar use of funds
permitted under subsection (g).'; and
(2) by striking paragraph (2) and inserting the following new paragraph:
`(2) QUALIFIED HEALTH INSURANCE- For purposes of this subsection and subsection
(g), the term `qualified health insurance' has the meaning given that term
in section 35(e) of the Internal Revenue Code of 1986.'.
(b) FUNDING- Section 174(c)(1) of the Workforce Investment Act of 1998 (29
U.S.C. 2919(c)(1)) is amended--
(1) in the paragraph heading, by striking `AUTHORIZATION AND APPROPRIATION
FOR FISCAL YEAR 2002' and inserting `APPROPRIATIONS'; and
(2) by striking subparagraph (A) and inserting the following new subparagraph:
`(A) to carry out subsection (a)(4)(A) of section 173--
`(i) $10,000,000 for fiscal year 2002; and
`(ii) $300,000,000 for the period of fiscal years 2005 through 2007;
and'.
(c) REPORT REGARDING FAILURE TO COMPLY WITH REQUIREMENTS FOR EXPEDITED APPROVAL
PROCEDURES- Section 173(f) of the Workforce Investment Act of 1998 (29 U.S.C.
2918(f)) is amended by adding at the end the following new paragraph:
`(8) REPORT FOR FAILURE TO COMPLY WITH REQUIREMENTS FOR EXPEDITED APPROVAL
PROCEDURES- If the Secretary fails to make the notification required under
clause (i) of paragraph (3)(A) within the 15-day period required under that
clause, or fails to provide the technical assistance required
under clause (ii) of such paragraph within a timely manner so that a State
or entity may submit an approved application within 2 months of the date on
which the State or entity's previous application was disapproved, the Secretary
shall submit a report to Congress explaining such failure.'.
(d) TECHNICAL AMENDMENT- Effective as if included in the enactment of the
Trade Act of 2002 (Public Law 107-210; 116 Stat. 933), subsection (f) of section
203 of that Act is repealed.
SEC. 14. EXTENSION OF FUNDING FOR OPERATION OF STATE HIGH RISK HEALTH INSURANCE
POOLS.
(a) EXTENSION OF SEED GRANTS- Section 2745 of the Public Health Service Act
(42 U.S.C. 300gg-45) is amended--
(1) in subsection (a), in the subsection heading by inserting `EXTENSION
OF' before `SEED'; and
(2) in subsection (c)(1), by striking `$20,000,000' and all that follows
through `2003' and inserting `$15,000,000 for the period of fiscal years
2005 and 2006'.
(b) FUNDS FOR OPERATIONS- Section 2745 of the Public Health Service Act (42
U.S.C. 300gg-45) is amended--
(A) in the subsection heading by striking `MATCHING'; and
(B) by striking paragraph (2) and inserting the following new paragraph:
`(2) ALLOTMENT- The amounts appropriated under subsection (c)(2) for a fiscal
year shall be made available to the States (or the entities that operate
the high risk pool under applicable State law) as follows:
`(A) An amount equal to 50 percent of the appropriated amount for the
fiscal year shall be allocated in equal amounts among each eligible State
that applies for assistance under this subsection.
`(B) An amount equal to 25 percent of the appropriated amount for the
fiscal year shall be allocated among the States so that the amount provided
to a State bears the same ratio to such available amount as the number
of uninsured individuals in the State bears to the total number of uninsured
individuals in all States (as determined by the Secretary).
`(C) An amount equal to 25 percent of the appropriated amount for the
fiscal year shall be allocated among the States so that the amount provided
to a State bears the same ratio to such available amount as the number
of individuals enrolled in health care coverage through the qualified
high risk pool of the State bears to the total number of individuals so
enrolled through qualified high risk pools in all States (as determined
by the Secretary).'; and
(2) in subsection (c)(2), by striking `$40,000,000' and all that follows
through the period and inserting `$75,000,000 for each of fiscal years 2005
through 2009 to make allotments under subsection (b)(2).'.
(c) DEFINITIONS- Section 2745 of the Public Health Service Act (42 U.S.C.
300gg-45) is amended--
(1) in subsection (d), by inserting after `2744(c)(2)' the following: `,
except that with respect to subparagraph (A) of such section a State may
elect to provide for the enrollment of eligible individuals through an acceptable
alternative mechanism,'; and
(2) by adding at the end the following new subsection:
`(e) STANDARD RISK RATE- In subsection (b)(1)(A), the term `standard risk
rate' means a rate--
`(1) determined under the State high risk pool by considering the premium
rates charged by other health insurers offering health insurance coverage
to individuals in the insurance market served;
`(2) that is established using reasonable actuarial techniques; and
`(3) that reflects anticipated claims experience and expenses for the coverage
involved.'.
END
