[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3218 Introduced in House (IH)]
111th CONGRESS
1st Session
H. R. 3218
To provide a refundable tax credit for medical costs, to expand access
to health insurance coverage through individual membership associations
(IMAs), and to assist in the establishment of high risk pools.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 14, 2009
Mr. Shadegg (for himself, Mr. Gingrey of Georgia, Mr. Bishop of Utah,
Mr. Boustany, Mr. Hoekstra, Mrs. Blackburn, Mr. Fleming, Mr. Franks of
Arizona, Mr. Buyer, and Mr. Burgess) introduced the following bill;
which was referred to the Committee on Energy and Commerce, and in
addition to the Committee on 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 provide a refundable tax credit for medical costs, to expand access
to health insurance coverage through individual membership associations
(IMAs), and to assist in the establishment of high risk pools.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE, ETC.
(a) Short Title.--This Act may be cited as the ``Improving Health
Care for All Americans Act''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title, etc.
Sec. 2. Statement of constitutional authority.
Sec. 3. Findings.
TITLE I--REFUNDABLE AND ADVANCEABLE CREDIT FOR MEDICAL COSTS
Sec. 101. Refundable and advanceable credit for medical costs.
TITLE II--EXPANSION OF ACCESS AND CHOICE OF HEALTH INSURANCE COVERAGE
THROUGH INDIVIDUAL MEMBERSHIP ASSOCIATIONS (IMAS)
Sec. 201. Expansion of access and choice of health insurance coverage
through individual membership associations
(IMAs).
TITLE III--FEDERAL MATCHING FUNDING FOR STATE INSURANCE EXPENDITURES
Sec. 301. Federal matching funding for StatFederal matching funding for
State insurance expenditurese insurance
expenditures.
SEC. 2. STATEMENT OF CONSTITUTIONAL AUTHORITY.
Congress enacts this Act pursuant to its authority under article I
of the Constitution to regulate commerce.
SEC. 3. FINDINGS.
The Congress finds the following:
(1) Approximately 180 million Americans receive health care
through employer-sponsored coverage.
(2) Surveys indicate that 8 in 10 Americans are satisfied
with the current employer-sponsored health care plan.
(3) Taxing employer-sponsored health care benefits,
creating a new government-run health care plan, and expanding
existing entitlement programs will result in the loss of
private health care coverage for an estimated 120 million
Americans.
TITLE I--REFUNDABLE AND ADVANCEABLE CREDIT FOR MEDICAL COSTS
SEC. 101. REFUNDABLE AND ADVANCEABLE CREDIT FOR MEDICAL COSTS.
(a) In General.--Subpart C of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 (relating to refundable credits)
is amended by inserting after section 36A the following new section:
``SEC. 36B. MEDICAL COSTS.
``(a) In General.--In the case of an eligible individual, there
shall be allowed as a credit against the tax imposed by this subtitle
an amount equal to the sum of--
``(1) the amount paid by the taxpayer during the taxable
year for qualified health insurance for coverage of the
taxpayer, his spouse, and dependents, and
``(2) the amount paid by the taxpayer during the taxable
year for medical care for the taxpayer, his spouse, and his
dependents.
``(b) Limitation.--The amount allowed as a credit under subsection
(a) for a taxable year shall not exceed $2,500 ($5,000 in the case of a
joint return).
``(c) Eligible Individual.--For purposes of this section, the term
`eligible individual' means an individual who is--
``(1) a citizen or national of the United States, or
``(2) lawfully present in the United States.
``(d) Medical Care.--For purposes of this section, the term
`medical care' has the meaning given such term by section 213(d),
determined without regard to subparagraphs (C) and (D) of paragraph (1)
thereof.
``(e) Qualified Health Insurance.--For purposes of this section--
``(1) In general.--The term `qualified health insurance'
means insurance which constitutes medical care.
``(2) Employer subsidized coverage.--Such term shall not
include amounts paid for coverage of any individual for any
month for which such individual participates in any subsidized
health plan maintained by any employer of the taxpayer or of
the spouse of the taxpayer. For purposes of the preceding
sentence, the rule of the last sentence of section 162(l)(2)(B)
shall apply and health care flexible spending accounts and
health reimbursement arrangements shall not be treated as a
subsidized health plan maintained by any employer.
``(3) Governmental coverage.--Such term shall not include
medical care provided through a program described in--
``(A) title XVIII or XIX 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, and
``(4) Exclusion of certain plans.--Such term does not
include insurance if substantially all of its coverage is
coverage described in section 223(c)(1)(B).
``(f) Special Rules.--
``(1) Coordination with medical deduction, etc.--Any amount
paid by a taxpayer for insurance to which subsection (a)
applies shall not be taken into account in computing the amount
allowable to the taxpayer as a credit under section 35 or as a
deduction under section 162(l) or 213(a).
``(2) Coordination with advance payments of credit;
recapture of excess advance payments.--With respect to any
taxable year--
``(A) the amount which would (but for this
subsection) be allowed as a credit to the taxpayer
under subsection (a) shall be reduced (but not below
zero) by the aggregate amount paid on behalf of such
taxpayer under section 7529 for months beginning in
such taxable year, and
``(B) the tax imposed by section 1 for such taxable
year shall be increased by the excess (if any) of--
``(i) the aggregate amount paid on behalf
of such taxpayer under section 7529 for months
beginning in such taxable year, over
``(ii) the amount which would (but for this
subsection) be allowed as a credit to the
taxpayer under subsection (a).
``(3) Denial of credit to dependents.--No credit shall be
allowed under this section to any individual with respect to
whom a deduction under section 151 is allowable to another
taxpayer for a taxable year beginning in the calendar year in
which such individual's taxable year begins.
``(4) Married couples must file joint return.--
``(A) In general.--If the taxpayer is married at
the close of the taxable year, the credit shall be
allowed under subsection (a) only if the taxpayer and
his spouse file a joint return for the taxable year.
``(B) Marital status; certain married individuals
living apart.--Rules similar to the rules of paragraphs
(3) and (4) of section 21(e) shall apply for purposes
of this paragraph.
``(5) Verification of coverage, etc.--No credit shall be
allowed under this section to any individual unless such
individual's coverage under qualified health insurance, and the
amount paid for such coverage, are verified in such manner as
the Secretary may prescribe.
``(6) Cost-of-living adjustment.--In the case of any
taxable year beginning in a calendar year after 2010, each
dollar amount contained in subsection (b) shall be increased by
an amount equal to--
``(A) such dollar amount, multiplied by
``(B) the cost-of-living adjustment determined
under section 1(f)(3) for the calendar year in which
the taxable year begins by substituting `calendar year
2009' for `calendar year 1992' in subparagraph (B)
thereof.
Any increase determined under the preceding sentence shall be
rounded to the nearest multiple of $10.''.
(b) Advance Payment.--
(1) In general.--Chapter 77 of the Internal Revenue Code of
1986 (relating to miscellaneous provisions) is amended by
adding at the end the following:
``SEC. 7529. ADVANCE PAYMENT OF CREDIT FOR MEDICAL COSTS.
``The Secretary shall establish a program for--
``(1) making payments to providers of qualified health
insurance (as defined in section 36B(e)) on behalf of taxpayers
eligible for the credit under section 36B, and
``(2) making payments relating to medical care for which a
credit is allowable under such section.''.
(2) Information reporting.--
(A) In general.--Subpart B of part III of
subchapter A of chapter 61 of such Code (relating to
information concerning transactions with other persons)
is amended by adding at the end the following new
section:
``SEC. 6050X. RETURNS RELATING TO CREDIT FOR MEDICAL COSTS.
``(a) Requirement of Reporting.--Every person who receives payments
for any month of any calendar year under section 7529 with respect to
any individual shall, at such time as the Secretary may prescribe, make
the return described in subsection (b) with respect to each such
individual.
``(b) Form and Manner of Returns.--A return is described in this
subsection if such return--
``(1) is in such form as the Secretary may prescribe, and
``(2) contains--
``(A) the name, address, and TIN of each individual
referred to in subsection (a), and
``(B) such other information as the Secretary may
prescribe.
``(c) Statements To Be Furnished to Individuals With Respect to
Whom Information Is Required.--Every person required to make a return
under subsection (a) shall furnish to each individual whose name is
required to be set forth in such return a written statement showing--
``(1) the name and address of the person required to make
such return and the phone number of the information contact for
such person, and
``(2) the information required to be shown on the return
with respect to such individual.
The written statement required under the preceding sentence shall be
furnished on or before January 31 of the year following the calendar
year for which the return under subsection (a) is required to be
made.''.
(B) Assessable penalties.--
(i) Subparagraph (B) of section 6724(d)(1)
of such Code (relating to definitions) is
amended by striking ``or'' at the end of clause
(xxii), by striking ``and'' at the end of
clause (xxiii) and inserting ``or'', and by
inserting after clause (xxiii) the following
new clause:
``(xxiv) section 6050X (relating to returns
relating to credit for medical costs), and''.
(ii) Paragraph (2) of section 6724(d) of
such Code is amended by striking the period at
the end of subparagraph (EE) and inserting a
comma, by striking the period at the end of
subparagraph (FF) and inserting ``, or'', and
by adding after subparagraph (FF) the following
new subparagraph:
``(GG) section 6050X (relating to returns relating
to credit for medical costs).''.
(3) Clerical amendments.--
(A) The table of sections for chapter 77 of such
Code is amended by adding at the end the following new
item:
``Sec. 7529. Advance payment of credit for medical costs.''.
(B) The table of sections for subpart B of part III
of subchapter A of chapter 61 of such Code is amended
by adding at the end the following new item:
``Sec. 6050X. Returns relating to credit for medical costs.''.
(c) Conforming Amendments.--
(1) Paragraph (2) of section 1324(b) of title 31, United
States Code, is amended by inserting ``36B,'' after ``35A,''.
(2) The table of sections for subpart C of part IV of
subchapter A of chapter 1 of the Internal Revenue Code of 1986
is amended by striking the item relating to section 36 and
inserting the following new items:
``Sec. 36B. Medical costs.''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2009.
TITLE II--EXPANSION OF ACCESS AND CHOICE OF HEALTH INSURANCE COVERAGE
THROUGH INDIVIDUAL MEMBERSHIP ASSOCIATIONS (IMAS)
SEC. 201. EXPANSION OF ACCESS AND CHOICE OF HEALTH INSURANCE COVERAGE
THROUGH INDIVIDUAL MEMBERSHIP ASSOCIATIONS (IMAS).
The Public Health Service Act is amended by adding at the end the
following new title:
``TITLE XXXI--INDIVIDUAL MEMBERSHIP ASSOCIATIONS
``SEC. 3101. DEFINITION OF INDIVIDUAL MEMBERSHIP ASSOCIATION (IMA).
``(a) In General.--For purposes of this title, the terms
`individual membership association' and `IMA' mean a legal entity that
meets the following requirements:
``(1) Organization.--The IMA is an organization operated
under the direction of an association (as defined in section
3104(1)).
``(2) Offering health benefits coverage.--
``(A) Different groups.--The IMA, in conjunction
with those health insurance issuers that offer health
benefits coverage through the IMA, makes available
health benefits coverage in the manner described in
subsection (b) to all members of the IMA and the
dependents of such members in the manner described in
subsection (c)(2) at rates that are established by the
health insurance issuer on a policy or product specific
basis and that may vary only as permissible under State
law.
``(B) Nondiscrimination in coverage offered.--
``(i) In general.--Subject to clause (ii),
the IMA may not offer health benefits coverage
to a member of an IMA unless the same coverage
is offered to all such members of the IMA.
``(ii) Construction.--Nothing in this title
shall be construed as requiring or permitting a
health insurance issuer to provide coverage
outside the service area of the issuer, as
approved under State law, or requiring a health
insurance issuer from excluding or limiting the
coverage on any individual, subject to the
requirement of section 2741.
``(C) No financial underwriting.--The IMA provides
health benefits coverage only through contracts with
health insurance issuers and does not assume insurance
risk with respect to such coverage.
``(3) Geographic areas.--Nothing in this title shall be
construed as preventing the establishment and operation of more
than one IMA in a geographic area or as limiting the number of
IMAs that may operate in any area.
``(4) Provision of administrative services to purchasers.--
``(A) In general.--The IMA may provide
administrative services for members. Such services may
include accounting, billing, and enrollment
information.
``(B) Construction.--Nothing in this subsection
shall be construed as preventing an IMA from serving as
an administrative service organization to any entity.
``(5) Filing information.--The IMA files with the Secretary
information that demonstrates the IMA's compliance with the
applicable requirements of this title.
``(b) Health Benefits Coverage Requirements.--
``(1) Compliance with consumer protection requirements.--
Any health benefits coverage offered through an IMA shall--
``(A) be underwritten by a health insurance issuer
that--
``(i) is licensed (or otherwise regulated)
under State law,
``(ii) meets all applicable State standards
relating to consumer protection, subject to
section 3002(b), and
``(B) subject to paragraph (2), be approved or
otherwise permitted to be offered under State law.
``(2) Examples of types of coverage.--The benefits coverage
made available through an IMA may include, but is not limited
to, any of the following if it meets the other applicable
requirements of this title:
``(A) Coverage through a health maintenance
organization.
``(B) Coverage in connection with a preferred
provider organization.
``(C) Coverage in connection with a licensed
provider-sponsored organization.
``(D) Indemnity coverage through an insurance
company.
``(E) Coverage offered in connection with a
contribution into a medical savings account, health
savings account, or flexible spending account.
``(F) Coverage that includes a point-of-service
option.
``(G) Any combination of such types of coverage.
``(3) Wellness bonuses for health promotion.--Nothing in
this title shall be construed as precluding a health insurance
issuer offering health benefits coverage through an IMA from
establishing premium discounts or rebates for members or from
modifying otherwise applicable copayments or deductibles in
return for adherence to programs of health promotion and
disease prevention so long as such programs are agreed to in
advance by the IMA and comply with all other provisions of this
title and do not discriminate among similarly situated members.
``(c) Members; Health Insurance Issuers.--
``(1) Members.--
``(A) In general.--Under rules established to carry
out this title, with respect to an individual who is a
member of an IMA, the individual may enroll for health
benefits coverage (including coverage for dependents of
such individual) offered by a health insurance issuer
through the IMA.
``(B) Rules for enrollment.--Nothing in this
paragraph shall preclude an IMA from establishing rules
of enrollment and reenrollment of members. Such rules
shall be applied consistently to all members within the
IMA and shall not be based in any manner on health
status-related factors.
``(2) Health insurance issuers.--The contract between an
IMA and a health insurance issuer shall provide, with respect
to a member enrolled with health benefits coverage offered by
the issuer through the IMA, for the payment of the premiums
collected by the issuer.
``SEC. 3102. APPLICATION OF CERTAIN LAWS AND REQUIREMENTS.
``State laws insofar as they relate to any of the following are
superseded and shall not apply to health benefits coverage made
available through an IMA:
``(1) Benefit requirements for health benefits coverage
offered through an IMA, including (but not limited to)
requirements relating to coverage of specific providers,
specific services or conditions, or the amount, duration, or
scope of benefits, but not including requirements to the extent
required to implement title XXVII or other Federal law and to
the extent the requirement prohibits an exclusion of a specific
disease from such coverage.
``(2) Any other requirements (including limitations on
compensation arrangements) that, directly or indirectly,
preclude (or have the effect of precluding) the offering of
such coverage through an IMA, if the IMA meets the requirements
of this title.
Any State law or regulation relating to the composition or organization
of an IMA is preempted to the extent the law or regulation is
inconsistent with the provisions of this title.
``SEC. 3103. ADMINISTRATION.
``(a) In General.--The Secretary shall administer this title and is
authorized to issue such regulations as may be required to carry out
this title. Such regulations shall be subject to Congressional review
under the provisions of chapter 8 of title 5, United States Code. The
Secretary shall incorporate the process of `deemed file and use' with
respect to the information filed under section 3001(a)(5)(A) and shall
determine whether information filed by an IMA demonstrates compliance
with the applicable requirements of this title. The Secretary shall
exercise authority under this title in a manner that fosters and
promotes the development of IMAs in order to improve access to health
care coverage and services.
``(b) Periodic Reports.--The Secretary shall submit to Congress a
report every 30 months, during the 10-year period beginning on the
effective date of the rules promulgated by the Secretary to carry out
this title, on the effectiveness of this title in promoting coverage of
uninsured individuals. The Secretary may provide for the production of
such reports through one or more contracts with appropriate private
entities.
``SEC. 3104. DEFINITIONS.
``For purposes of this title:
``(1) Association.--The term `association' means, with
respect to health insurance coverage offered in a State, an
association which--
``(A) has been actively in existence for at least 5
years;
``(B) has been formed and maintained in good faith
for purposes other than obtaining insurance;
``(C) does not condition membership in the
association on any health status-related factor
relating to an individual (including an employee of an
employer or a dependent of an employee); and
``(D) does not make health insurance coverage
offered through the association available other than in
connection with a member of the association.
``(2) Dependent.--The term `dependent', as applied to
health insurance coverage offered by a health insurance issuer
licensed (or otherwise regulated) in a State, shall have the
meaning applied to such term with respect to such coverage
under the laws of the State relating to such coverage and such
an issuer. Such term may include the spouse and children of the
individual involved.
``(3) Health benefits coverage.--The term `health benefits
coverage' has the meaning given the term health insurance
coverage in section 2791(b)(1).
``(4) Health insurance issuer.--The term `health insurance
issuer' has the meaning given such term in section 2791(b)(2).
``(5) Health status-related factor.--The term `health
status-related factor' has the meaning given such term in
section 2791(d)(9).
``(6) IMA; individual membership association.--The terms
`IMA' and `individual membership association' are defined in
section 3101(a).
``(7) Member.--The term `member' means, with respect to an
IMA, an individual who is a member of the association to which
the IMA is offering coverage.''.
TITLE III--FEDERAL MATCHING FUNDING FOR STATE INSURANCE EXPENDITURES
SEC. 301. FEDERAL MATCHING FUNDING FOR STATFEDERAL MATCHING FUNDING FOR
STATE INSURANCE EXPENDITURESE INSURANCE EXPENDITURES.
(a) In General.--Subject to the succeeding provisions of this
section, each State shall receive from the Secretary of Health and
Human Services an amount equal to 50 percent of the funds expended by
the State in providing for the use, in connection with providing health
benefits coverage, of a high-risk pool, a reinsurance pool, or other
risk-adjustment mechanism used for the purpose of subsidizing the
purchase of private health insurance.
(b) Funding Limitation.--A State shall not receive under this
section for a fiscal year more than a total of 50 cents multiplied by
the average number of residents (as estimated by the Secretary) in the
State in the fiscal year.
(c) Administration.--The Secretary of Health and Human Services
shall provide for the administration of this section and may establish
such terms and conditions, including the requirement of an application,
as may be appropriate to carry out this section.
(d) Construction.--Nothing in this section shall be construed as
requiring a State to operate a reinsurance pool (or other risk-
adjustment mechanism) under this section or as preventing a State from
operating such a pool or mechanism through one or more private
entities.
(e) High-risk Pool.--For purposes of this section, the term ``high-
risk pool'' means any qualified high risk pool (as defined in section
2744(c)(2) of the Public Health Service Act).
(f) Reinsurance Pool or Other Risk-adjustment Mechanism Defined.--
For purposes of this section, the term ``reinsurance pool or other
risk-adjustment mechanism'' means any State-based risk spreading
mechanism to subsidize the purchase of private health insurance for the
high-risk population.
(g) High-risk Population.--For purposes of this section, the term
``high-risk population'' means--
(1) individuals who, by reason of the existence or history
of a medical condition, are able to acquire health coverage
only at rates which are at least 150 percent of the standard
risk rates for such coverage, and
(2) individuals who are provided health coverage by a high-
risk pool.
(h) State Defined.--For purposes of this section, the term
``State'' includes the District of Columbia, Puerto Rico, the Virgin
Islands, Guam, American Samoa, and the Northern Mariana Islands.
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