[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 845 Introduced in House (IH)]
106th CONGRESS
1st Session
H. R. 845
To amend the Public Health Service Act, the Employee Retirement Income
Security Act of 1974, and the Internal Revenue Code of 1986 to require
a health insurance issuer to notify participants and beneficiaries of
impending termination of coverage resulting from the failure of a group
health plan to pay premiums necessary to maintain coverage, and for
other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 24, 1999
Mrs. Thurman (for herself, Mr. Stark, Mr. Young of Florida, Mr.
Kucinich, Mr. Waxman, and Mr. Davis of Florida) introduced the
following bill; which was referred to the Committee on Commerce, and in
addition to the Committees on Education and the Workforce, and Ways and
Means, for a period to be subsequently determined by the Speaker, in
each case for consideration of such provisions as fall within the
jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To amend the Public Health Service Act, the Employee Retirement Income
Security Act of 1974, and the Internal Revenue Code of 1986 to require
a health insurance issuer to notify participants and beneficiaries of
impending termination of coverage resulting from the failure of a group
health plan to pay premiums necessary to maintain coverage, 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.
This Act may be cited as the ``Beneficiary Health Coverage
Notification Rights Act of 1999''.
SEC. 2. NOTIFICATION OF DISCONTINUATION OF HEALTH INSURANCE COVERAGE TO
PARTICIPANTS AND BENEFICIARIES.
(a) Group Health Plans.--
(1) Public health service act amendment.--(A) Subpart 2 of
part A of title XXVII of the Public Health Service Act is
amended by adding at the end the following new section:
``SEC. 2707. PROHIBITION OF RETROACTIVE TERMINATION; ADVANCE
NOTIFICATION OF DISCONTINUATION OF HEALTH INSURANCE
COVERAGE TO PARTICIPANTS AND BENEFICIARIES.
``A health insurance issuer offering group health insurance
coverage in connection with a group health plan may not terminate the
coverage with respect to the plan (or allow the coverage to lapse)
because the plan failed to pay to the issuer premiums necessary to
maintain the coverage unless the issuer, at least 30 days before the
effective date of termination or lapse of the coverage, provides
written notice to each participant or beneficiary whose coverage would
so terminate or lapse, indicating the fact and effective date of such
termination or lapse of coverage.''.
(B) Section 2723(c) of such Act (42 U.S.C. 300gg-23(c)) is
amended by striking ``section 2704'' and inserting ``sections
2704 and 2707''.
(2) ERISA amendment.--(A) Subpart B of part 7 of subtitle B
of title I of the Employee Retirement Income Security Act of
1974 is amended by adding at the end the following new section:
``SEC. 714. PROHIBITION OF RETROACTIVE TERMINATION; ADVANCE
NOTIFICATION OF DISCONTINUATION OF HEALTH INSURANCE
COVERAGE TO PARTICIPANTS AND BENEFICIARIES.
``A health insurance issuer offering group health insurance
coverage in connection with a group health plan may not terminate the
coverage with respect to the plan (or allow the coverage to lapse)
because the plan failed to pay to the issuer premiums necessary to
maintain the coverage unless the issuer, at least 30 days before the
effective date of termination or lapse of the coverage, provides
written notice to each participant or beneficiary whose coverage would
so terminate or lapse, indicating the fact and effective date of such
termination or lapse of coverage.''.
(B) Section 732(a) of such Act (29 U.S.C. 1191a(a)) is
amended by striking ``section 711'' and inserting ``sections
711 and 714''.
(C) The table of contents in section 1 of such Act is
amended by inserting after the item relating to section 713 the
following new item:
``Sec. 714. Prohibition of retroactive termination; advance
notification of discontinuation of health
insurance coverage to participants and
beneficiaries.''.
(b) Effective Date.--The amendments made by subsection (a) apply
with respect to terminations and lapses of coverage occurring on or
after the first day of the first month that begins more than 60 days
after the date of the enactment of this Act, regardless of the
effective date of such terminations and lapses, but do not apply to
terminations and lapses for which notice has been provided before such
first day.
SEC. 3. DEEMING PERIOD OF HEALTH INSURANCE COVERAGE FOR PARTICIPANTS
AND BENEFICIARIES BETWEEN DISCONTINUATION AND NOTICE OF
DISCONTINUATION OF COVERAGE.
(a) Group Health Plans.--
(1) Public health service act amendments.--
(A) Section 2701(c) of the Public Health Service
Act (42 U.S.C. 300gg(c)) is amended by adding at the
end the following new paragraph:
``(5) Deeming period of coverage for participants and
beneficiaries between discontinuation and notice of
discontinuation of coverage.--
``(A) In general.--If--
``(i)(I) a health insurance issuer offering
group health insurance coverage in connection
with a group health plan terminates the
coverage with respect to the plan (or allows
the coverage to lapse), or (II) coverage under
a group health plan is terminated; and
``(ii) a participant or beneficiary whose
coverage is so terminated or lapsed only
receives notice of such termination or lapse
after the date that the termination or lapse
takes effect,
for the purposes described in subparagraph (B), such
individual shall be treated as being covered under the
terminated or lapsed group health insurance coverage or
group health plan during the deeming period, as defined
in subparagraph (C).
``(B) Application.--Subparagraph (A) shall apply--
``(i) for purposes of this part (including
for purposes of reducing pre-existing condition
exclusion periods and avoiding a significant
break in coverage); and
``(ii) for purposes of applying any State
law that provides for a conversion or any other
health insurance option based on (or taking
into account) loss of group health insurance
coverage or loss of coverage under a group
health plan.
``(C) Deeming period defined.--For purposes of this
paragraph, the term `deeming period' is the period
beginning on the effective date of the termination or
lapse of coverage described in subparagraph (A)(i) and
ending on the date on which the participant or
beneficiary receives notice described in subparagraph
(A)(ii).
``(D) No entitlement to benefits during deeming
period.--Nothing in this paragraph shall be construed
as entitling any individual to any benefits under the
plan or coverage during the deeming period.''.
(B) Section 2701(f)(1)(D) of such Act (42 U.S.C.
300gg(f)(1)(D)) is amended by inserting before the
period ``or if later, the date the employee is notified
of such termination''.
(2) ERISA amendments.--
(A) Section 701(c) of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1181(c)) is
amended by adding at the end the following new
paragraph:
``(5) Deeming period of coverage for participants and
beneficiaries between discontinuation and notice of
discontinuation of coverage.--
``(A) In general.--If--
``(i)(I) a health insurance issuer offering
group health insurance coverage in connection
with a group health plan terminates the
coverage with respect to the plan (or allows
the coverage to lapse), or (II) coverage under
a group health plan is terminated; and
``(ii) a participant or beneficiary whose
coverage is so terminated or lapsed only
receives notice of such termination or lapse
after the date that the termination or lapse
takes effect,
for the purposes described in subparagraph (B), such
individual shall be treated as being covered under the
terminated or lapsed group health insurance coverage or
group health plan during the deeming period, as defined
in subparagraph (C).
``(B) Application.--Subparagraph (A) shall apply
for purposes of this part (including for purposes of
reducing pre-existing condition exclusion periods and
avoiding a significant break in coverage).
``(C) Deeming period defined.--For purposes of this
paragraph, the term `deeming period' is the period
beginning on the effective date of the termination or
lapse of coverage described in subparagraph (A)(i) and
ending on the date on which the participant or
beneficiary receives notice described in subparagraph
(A)(ii).
``(D) No entitlement to benefits during deeming
period.--Nothing in this paragraph shall be construed
as entitling any individual to any benefits under the
plan or coverage during the deeming period.''.
(B) Section 701(f)(1)(D) of such Act (29 U.S.C.
1181(f)(1)(D)) is amended by inserting before the
period ``or if later, the date the employee is notified
of such termination''.
(3) Internal revenue code amendments.--Section 9801(c) of
the Internal Revenue Code of 1986 is amended by adding at the
end the following new paragraph:
``(5) Deeming period of coverage for participants and
beneficiaries between discontinuation and notice of
discontinuation of coverage.--
``(A) In general.--If--
``(i)(I) a health insurance issuer offering
group health insurance coverage in connection
with a group health plan terminates the
coverage with respect to the plan (or allows
the coverage to lapse), or (II) coverage under
a group health plan is terminated; and
``(ii) a participant or beneficiary whose
coverage is so terminated or lapsed only
receives notice of such termination or lapse
after the date that the termination or lapse
takes effect,
for the purposes described in subparagraph (B), such
individual shall be treated as being covered under the
terminated or lapsed group health insurance coverage or
group health plan during the deeming period, as defined
in subparagraph (C).
``(B) Application.--Subparagraph (A) shall apply
for purposes of this part (including for purposes of
reducing pre-existing condition exclusion periods and
avoiding a significant break in coverage).
``(C) Deeming period defined.--For purposes of this
paragraph, the term `deeming period' is the period
beginning on the effective date of the termination or
lapse of coverage described in subparagraph (A)(i) and
ending on the date on which the participant or
beneficiary receives notice described in subparagraph
(A)(ii).
``(D) No entitlement to benefits during deeming
period.--Nothing in this paragraph shall be construed
as entitling any individual to any benefits under the
plan or coverage during the deeming period.''.
(B) Section 9801(f)(1)(D) of such Code is amended
by inserting before the period ``or if later, the date
the employee is notified of such termination''.
(b) Effective Date.--The amendments made by subsection (a) apply
with respect to terminations and lapses of coverage occurring on or
after the first day of the first month that begins after the date of
the enactment of this Act, regardless of the effective date of such
terminations and lapses, but do not apply to terminations and lapses
for which notice has been provided before such first day.
<all>