[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 2315 Introduced in Senate (IS)]







105th CONGRESS
  2d Session
                                S. 2315

  To amend the Public Health Service Act, Employee Retirement Income 
 Security Act of 1974, and titles XVIII and XIX of the Social Security 
Act to require that group and individual health insurance coverage and 
   group health plans and managed care plans under the medicare and 
  medicaid programs provide coverage for hospital lengths of stay as 
 determined by the attending health care provider in consultation with 
                              the patient.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 15, 1998

Mrs. Feinstein (for herself, Mr. D'Amato, and Mr. Ford) introduced the 
 following bill; which was read twice and referred to the Committee on 
                       Labor and Human Resources

_______________________________________________________________________

                                 A BILL


 
  To amend the Public Health Service Act, Employee Retirement Income 
 Security Act of 1974, and titles XVIII and XIX of the Social Security 
Act to require that group and individual health insurance coverage and 
   group health plans and managed care plans under the medicare and 
  medicaid programs provide coverage for hospital lengths of stay as 
 determined by the attending health care provider in consultation with 
                              the patient.

    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 ``Hospital Length of Stay Act of 
1998''.

SEC. 2. COVERAGE OF HOSPITAL LENGTH OF STAY.

    (a) Group Health Plans.--
            (1) Public health service act amendments.--
                    (A) In general.--Subpart 2 of part A of title XXVII 
                of the Public Health Service Act (as added by section 
                604(a) of the Newborns' and Mothers' Health Protection 
                Act of 1996 and amended by section 703(a) of the Mental 
                Health Parity Act of 1996) is amended by adding at the 
                end the following new section:

``SEC. 2706. STANDARDS RELATING TO COVERAGE OF HOSPITAL LENGTHS OF 
              STAY.

    ``(a) Requirement.--A group health plan and a health insurance 
issuer offering group health insurance coverage in connection with a 
group health plan (including a self-insured issuer) that provides 
coverage for inpatient hospital services--
            ``(1) shall provide coverage for the length of an inpatient 
        hospital stay as determined by the attending physician (or 
        other attending health care provider to the extent permitted 
        under State law) in consultation with the patient to be 
        medically appropriate; and
            ``(2) may not require that a provider obtain authorization 
        from the plan or the issuer for prescribing any length of stay 
        required under paragraph (1).
    ``(b) Prohibitions.--A group health plan and a health insurance 
issuer offering group health insurance coverage in connection with a 
group health plan (including a self-insured issuer) may not--
            ``(1) deny to an individual eligibility, or continued 
        eligibility, to enroll or to renew coverage under the terms of 
        the plan, solely for the purpose of avoiding the requirements 
        of this section;
            ``(2) provide monetary payments or rebates to an individual 
        to encourage the individual to accept less than the minimum 
        protections available under this section;
            ``(3) penalize or otherwise reduce or limit the 
        reimbursement of an attending provider because such provider 
        provided care to an individual participant or beneficiary in 
        accordance with this section;
            ``(4) provide incentives (monetary or otherwise) to an 
        attending provider to induce such provider to provide care to 
        an individual participant or beneficiary in a manner 
        inconsistent with this section; or
            ``(5) subject to subsection (c)(4), restrict benefits for 
        any portion of a period within a hospital length of stay 
        required under subsection (a) in a manner which is less 
        favorable than the benefits provided for any preceding portion 
        of such stay.
    ``(c) Rules of Construction.--
            ``(1) No requirement to stay.--Nothing in this section 
        shall be construed to require an individual who is a 
        participant or beneficiary to stay in the hospital for a fixed 
        period of time for any procedure.
            ``(2) No effect on requirements for minimum hospital stay 
        following birth.--Nothing in this section shall be construed as 
        modifying the requirements of section 2704.
            ``(3) Nonapplicability.--This section shall not apply with 
        respect to any group health plan, or any group health insurance 
        coverage offered by a health insurance issuer (including a 
        self-insured issuer), which does not provide benefits for 
        hospital lengths of stay.
            ``(4) Cost-sharing.--Nothing in this section shall be 
        construed as preventing a group health plan, or a health 
        insurance issuer offering group health insurance coverage in 
        connection with a group health plan (including a self-insured 
        issuer), from imposing deductibles, coinsurance, or other cost-
        sharing in relation to benefits for hospital lengths of stay 
under the plan, health insurance coverage offered in connection with a 
group health plan, or the supplemental policy, except that such 
coinsurance or other cost-sharing for any portion of a period within a 
hospital length of stay required under subsection (a) may not be 
greater than such coinsurance or cost-sharing for any preceding portion 
of such stay.
    ``(d) Notice.--A group health plan under this part shall comply 
with the notice requirement under section 713(d) of the Employee 
Retirement Income Security Act of 1974 with respect to the requirements 
of this section as if such section applied to such plan.
    ``(e) Level and Type of Reimbursements.--Nothing in this section 
shall be construed to prevent a group health plan or a health insurance 
issuer offering group health insurance coverage in connection with a 
group health plan (including a self-insured issuer) from negotiating 
the level and type of reimbursement with a provider for care provided 
in accordance with this section.
    ``(f) Preemption; Exception for Health Insurance Coverage in 
Certain States.--
            ``(1) In general.--The requirements of this section shall 
        not apply with respect to health insurance coverage if there is 
        a State law (as defined in section 2723(d)(1)) for a State that 
        regulates such coverage and provides greater protections to 
        patients than those provided under this section.
            ``(2) Construction.--Section 2723(a)(1) shall not be 
        construed as superseding a State law described in paragraph 
        (1).''.
                    (B) Conforming amendment.--Section 2723(c) of the 
                Public Health Service Act (42 U.S.C. 300gg-23(c)), as 
                amended by section 604(b)(2) of Public Law 104-204, is 
                amended by striking ``section 2704'' and inserting 
                ``sections 2704 and 2706''.
            (2) ERISA amendments.--
                    (A) In general.--Subpart B of part 7 of subtitle B 
                of title I of the Employee Retirement Income Security 
                Act of 1974 (as added by section 603(a) of the 
                Newborns' and Mothers' Health Protection Act of 1996 
                and amended by section 702(a) of the Mental Health 
                Parity Act of 1996) is amended by adding at the end the 
                following new section:

``SEC. 713. STANDARDS RELATING TO COVERAGE OF HOSPITAL LENGTHS OF STAY.

    ``(a) Requirement.--A group health plan and a health insurance 
issuer offering group health insurance coverage in connection with a 
group health plan (including a self-insured issuer), that provides 
coverage for inpatient hospital services--
            ``(1) shall provide coverage for the length of an inpatient 
        hospital stay as determined by the attending physician (or 
        other attending health care provider to the extent permitted 
        under State law) in consultation with the patient to be 
        medically appropriate; and
            ``(2) may not require that a provider obtain authorization 
        from the plan or the issuer for prescribing any length of stay 
        required under paragraph (1).
    ``(b) Prohibitions.--A group health plan and a health insurance 
issuer offering group health insurance coverage in connection with a 
group health plan (including a self-insured issuer), may not--
            ``(1) deny to an individual eligibility, or continued 
        eligibility, to enroll or to renew coverage under the terms of 
        the plan, solely for the purpose of avoiding the requirements 
        of this section;
            ``(2) provide monetary payments or rebates to an individual 
        to encourage the individual to accept less than the minimum 
        protections available under this section;
            ``(3) penalize or otherwise reduce or limit the 
        reimbursement of an attending provider because such provider 
provided care to an individual participant or beneficiary in accordance 
with this section;
            ``(4) provide incentives (monetary or otherwise) to an 
        attending provider to induce such provider to provide care to 
        an individual participant or beneficiary in a manner 
        inconsistent with this section; or
            ``(5) subject to subsection (c)(4), restrict benefits for 
        any portion of a period within a hospital length of stay 
        required under subsection (a) in a manner which is less 
        favorable than the benefits provided for any preceding portion 
        of such stay.
    ``(c) Rules of Construction.--
            ``(1) No requirement to stay.--Nothing in this section 
        shall be construed to require an individual who is a 
        participant or beneficiary to stay in the hospital for a fixed 
        period of time for any procedure.
            ``(2) No effect on requirements for minimum hospital stay 
        following birth.--Nothing in this section shall be construed as 
        modifying the requirements of section 2704.
            ``(3) Nonapplicability.--This section shall not apply with 
        respect to any group health plan or any group health insurance 
        coverage offered by a health insurance issuer (including a 
        self-insured issuer), which does not provide benefits for 
        hospital lengths of stay.
            ``(4) Cost-sharing.--Nothing in this section shall be 
        construed as preventing a group health plan or a health 
        insurance issuer offering group health insurance coverage in 
        connection with a group health plan (including a self-insured 
        issuer), from imposing deductibles, coinsurance, or other cost-
        sharing in relation to benefits for hospital lengths of stay 
        under the plan or health insurance coverage offered in 
        connection with a group health plan, except that such 
        coinsurance or other cost-sharing for any portion of a period 
        within a hospital length of stay required under subsection (a) 
        may not be greater than such coinsurance or cost-sharing for 
        any preceding portion of such stay.
    ``(d) Notice under Group Health Plan.--The imposition of the 
requirements of this section shall be treated as a material 
modification in the terms of the plan described in section 102(a)(1), 
for purposes of assuring notice of such requirements under the plan; 
except that the summary description required to be provided under the 
last sentence of section 104(b)(1) with respect to such modification 
shall be provided by not later than 60 days after the first day of the 
first plan year in which such requirements apply.
    ``(e) Level and Type of Reimbursements.--Nothing in this section 
shall be construed to prevent a group health plan or a health insurance 
issuer offering group health insurance coverage in connection with a 
group health plan (including a self-insured issuer), from negotiating 
the level and type of reimbursement with a provider for care provided 
in accordance with this section.
    ``(f) Preemption; Exception for Health Insurance Coverage in 
Certain States.--
            ``(1) In general.--The requirements of this section shall 
        not apply with respect to health insurance coverage if there is 
        a State law (as defined in section 731(d)(1)) for a State that 
        regulates such coverage and provides greater protections to 
        patients than those provided under this section.
            ``(2) Construction.--Section 731(a)(1) shall not be 
        construed as superseding a State law described in paragraph 
        (1).''.
                    (B) Conforming amendments.--
                            (i) Section 731(c) of such Act (29 U.S.C. 
                        1191(c)), as amended by section 603(b)(1) of 
                        Public Law 104-204, is amended by striking 
                        ``section 711'' and inserting ``sections 711 
                        and 713''.
                            (ii) Section 732(a) of such Act (29 U.S.C. 
                        1191a(a)), as amended by section 603(b)(2) of 
                        Public Law 104-204, is amended by striking 
                        ``section 711'' and inserting ``sections 711 
                        and 713''.
                            (iii) The table of contents in section 1 of 
                        such Act is amended by inserting after the item 
                        relating to section 712 the following new item:

``Sec. 713. Standards relating to coverage of hospital lengths of 
                            stay.''.
    (b) Individual Market.--Subpart 3 of part B of title XXVII of the 
Public Health Service Act (as added by section 605(a) of the Newborn's 
and Mother's Health Protection Act of 1996) is amended by adding at the 
end the following new section:

``SEC. 2752. STANDARDS RELATING TO COVERAGE OF HOSPITAL LENGTHS OF 
              STAY.

    ``The provisions of section 2706 shall apply to health insurance 
coverage offered by a health insurance issuer in the individual market 
in the same manner as they apply to health insurance coverage offered 
by a health insurance issuer in connection with a group health plan in 
the small or large group market.''.
    (c) Effective Dates.--
            (1) Group health plans.--Subject to paragraph (3), the 
        amendments made by subsection (a) shall apply with respect to 
        group health plans for plan years beginning on or after January 
        1, 1999.
            (2) Health insurance coverage.--The amendment made by 
        subsection (b) shall apply with respect to health insurance 
        coverage offered, sold, issued, renewed, in effect, or operated 
        in the individual market on or after such date.
            (3) Collective bargaining agreements.--In the case of a 
        group health plan maintained pursuant to 1 or more collective 
        bargaining agreements between employee representatives and 1 or 
        more employers ratified before the date of enactment of this 
        Act, the amendments made subsection (a) shall not apply to plan 
        years beginning before the later of--
                    (A) the date on which the last collective 
                bargaining agreements relating to the plan terminates 
                (determined without regard to any extension thereof 
                agreed to after the date of enactment of this Act), or
                    (B) January 1, 1999.
        For purposes of subparagraph (A), any plan amendment made 
        pursuant to a collective bargaining agreement relating to the 
        plan which amends the plan solely to conform to any requirement 
        added by subsection (a) shall not be treated as a termination 
        of such collective bargaining agreement.
    (d) Coordinated Regulations.--Section 104(1) of Health Insurance 
Portability and Accountability Act of 1996 is amended by striking 
``this subtitle (and the amendments made by this subtitle and section 
401)'' and inserting ``the provisions of part 7 of subtitle B of title 
I of the Employee Retirement Income Security Act of 1974, and the 
provisions of parts A and C of title XXVII of the Public Health Service 
Act''.

SEC. 3. APPLICATION TO MEDICARE AND MEDICAID BENEFICIARIES.

    (a) Medicare.--
            (1) In general.--Title XVIII of the Social Security Act (42 
        U.S.C. 1395 et seq.) is amended by adding at the end the 
        following:

``hospital lengths of stay for beneficiaries enrolled in private health 
                                 plans

    ``Sec. 1897. (a) Application to Medicare.--Notwithstanding the 
limitation on benefits described in section 1812, or any other 
limitation on benefits imposed under this title, the provisions of 
section 2706 of the Public Health Service Act shall apply to the 
provision of items and services under this title.
    ``(b) Medicare+Choice and Eligible Organizations.--The Secretary 
may not enter into a contract with a Medicare+Choice organization under 
part C, or with an eligible organization with a risk-sharing contract 
under section 1876, unless the organization meets the requirements of 
section 2706 of the Public Health Service Act with respect to 
individuals enrolled with the organization.''.
            (2) Medicare supplemental policies.--
                    (A) In general.--Section 1882(c) of the Social 
                Security Act (42 U.S.C. 1395ss(c)) is amended--
                            (i) in paragraph (4), by striking ``and'' 
                        at the end;
                            (ii) in paragraph (5), by striking the 
                        period and inserting ``, and''; and
                            (iii) by adding at the end the following:
            ``(6) meets the requirements of section 2706 of the Public 
        Health Service Act with respect to individuals enrolled under 
        the policy.''.
                    (B) Conforming amendment.--Section 1882(b)(1)(B) of 
                the Social Security Act (42 U.S.C. 1395ss(b)(1)(B)) is 
                amended by striking ``(5)'' and inserting ``(6)''.
            (3) Cost Sharing.--Nothing in this subsection or section 
        2706(c) of the Public Health Service Act shall be construed as 
        authorizing the imposition of cost sharing with respect to the 
        coverage or benefits required to be provided under the 
        amendments to the Social Security Act made by paragraphs (1) 
        and (2) that is inconsistent with the cost sharing that is 
        otherwise permitted under title XVIII of the Social Security 
        Act.
    (b) Medicaid.--Title XIX of the Social Security Act (42 U.S.C. 1396 
et seq.) is amended by redesignating section 1935 as section 1936 and 
by inserting after section 1934 the following:

``hospital lengths of stay for beneficiaries enrolled in private health 
                                 plans

    ``Sec. 1935. (a) In General.--A State plan may not be approved 
under this title unless the plan requires each health insurance issuer 
or other entity with a contract with such plan to provide coverage or 
benefits to individuals eligible for medical assistance under the plan, 
including a managed care entity, as defined in section 1932(a)(1)(B), 
to comply with the provisions of section 2706 of the Public Health 
Service Act with respect to such coverage or benefits.
    ``(b) Cost Sharing.--Nothing in this section or section 2706(c) of 
the Public Health Service Act shall be construed as authorizing a 
health insurance issuer or entity to impose cost sharing with respect 
to the coverage or benefits required to be provided under section 2706 
of the Public Health Service Act that is inconsistent with the cost 
sharing that is otherwise permitted under this title.
    ``(c) Waivers Prohibited.--The requirement of subsection (a) may 
not be waived under section 1115 or section 1915(b) of the Social 
Security Act.''.
    (c) Effective Date.--The amendments made by this section apply to 
contract years under titles XVIII and XIX of the Social Security Act 
beginning on or after January 1, 1999.
    (d) Medigap Transition Provisions.--
            (1) In general.--If the Secretary of Health and Human 
        Services identifies a State as requiring a change to its 
        statutes or regulations to conform its regulatory program to 
        the changes made by subsection (a)(2), the State regulatory 
        program shall not be considered to be out of compliance with 
        the requirements of section 1882 of the Social Security Act due 
        solely to failure to make such change until the date specified 
        in paragraph (4).
            (2) NAIC standards.--If, within 9 months after the date of 
        the enactment of this Act, the National Association of 
        Insurance Commissioners (in this subsection referred to as the 
        ``NAIC'') modifies its NAIC Model Regulation relating to 
        section 1882 of the Social Security Act (referred to in such 
        section as the 1991 NAIC Model Regulation, as modified pursuant 
        to section 171(m)(2) of the Social Security Act Amendments of 
        1994 (Public Law 103-432) and as modified pursuant to section 
        1882(d)(3)(A)(vi)(IV) of the Social Security Act, as added by 
        section 271(a) of the Health Insurance Portability and 
        Accountability Act of 1996 (Public Law 104-191) to conform to 
        the amendments made by this section, such revised regulation 
        incorporating the modifications shall be considered to be the 
        applicable NAIC model regulation (including the revised NAIC 
        model regulation and the 1991 NAIC Model Regulation) for the 
        purposes of such section.
            (3) Secretary standards.--If the NAIC does not make the 
        modifications described in paragraph (2) within the period 
        specified in such paragraph, the Secretary of Health and Human 
        Services shall make the modifications described in such 
        paragraph and such revised regulation incorporating the 
        modifications shall be considered to be the appropriate 
        Regulation for the purposes of such section.
            (4) Date specified.--
                    (A) In general.--Subject to subparagraph (B), the 
                date specified in this paragraph for a State is the 
                earlier of--
                            (i) the date the State changes its statutes 
                        or regulations to conform its regulatory 
                        program to the changes made by this section, or
                            (ii) 1 year after the date the NAIC or the 
                        Secretary first makes the modifications under 
                        paragraph (2) or (3), respectively.
                    (B) Additional legislative action required.--In the 
                case of a State which the Secretary identifies as--
                            (i) requiring State legislation (other than 
                        legislation appropriating funds) to conform its 
                        regulatory program to the changes made in this 
                        section, but
                            (ii) having a legislature which is not 
                        scheduled to meet in 1999 in a legislative 
                        session in which such legislation may be 
                        considered,
                the date specified in this paragraph is the first day 
                of the first calendar quarter beginning after the close 
                of the first legislative session of the State 
                legislature that begins on or after July 1, 1999. For 
                purposes of the previous sentence, in the case of a 
                State that has a 2-year legislative session, each year 
                of such session shall be deemed to be a separate 
                regular session of the State legislature.
                                 <all>