[Congressional Record Volume 140, Number 76 (Thursday, June 16, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. HOLLINGS:
  S. 2198. A bill to authorize a certificate of documentation for the 
vessel Serenity; to the Committee on Commerce, Science, and 
Transportation.


               the vessel ``serenity'' documentation act

  Mr. HOLLINGS. Mr. President, today I am introducing a bill to direct 
that the vessel Serenity, United States official No. 1021393, be 
accorded coastwise trading privileges and be issued a coastwise 
endorsement under section 12106 of title 46, U.S. Code.
  The Serenity was constructed in Taiwan in 1981 as a recreational 
vessel. It is 34 feet in length, 10.3 feet in width,and 6.3 feet in 
depth, and is self-propelled.
  The vessel was purchased in 1994 by John M. McGlynn of Mount 
Pleasant, SC, with the intention of chartering it for short sailing 
tours in Charleston harbor. When Mr. McGlynn acquired the boat, he was 
unaware of the specific coastwise trade and fisheries restrictions of 
the Jones Act. Due to the fact that the vessel was foreign built, it 
does not meet the requirements for a coastwise license endorsement in 
the United States. Such documentation is mandatory to enable the owner 
to use the vessel for its intended purpose.
  The owner of the Serenity is thus seeking a waiver of the existing 
law because he wishes to use the vessel in his chartering business. If 
he is granted this waiver, he intends to comply fully with U.S. 
documentation and safety requirements. The propose of the legislation I 
am introducing is to allow the Serenity to engage in the coastwise 
trade and fisheries of the United States.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2198

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled, That 
     notwithstanding sections 12106, 12107, and 12108 of title 46, 
     United States Code, and section 27 of the Merchant Marine 
     Act. 1920 (46 App. U.S.C. 883), as applicable on the date of 
     enactment of this Act, the Secretary of Transportation may 
     issue a certificate of documentation for the vessel Serenity, 
     United States official number 1021393.
                                 ______
                                 
      By Mr. HOLLINGS:
  S. 2199. A bill to authorize a certificate of documentation for the 
vessel Emerald Ayes; to the Committee on Commerce, Science, and 
Transportation.


             the vessel ``emerald ayes'' documentation act

  Mr. HOLLINGS. Mr. President, today I am introducing a bill to direct 
that the vessel Emerald Ayes, U.S. official No. 986099, be accorded 
coastwise trading privileges and be issued a coastwise endorsement 
under section 12106 of title 46, United States Code.
  The Emerald Ayes was constructed in Canada in 1992 as a recreational 
vessel. It is 36.4 feet in length, 18.2 feet in width, and 9.4 feet in 
depth, and is self-propelled.
  The vessel was purchased in 1992 by Dr. Stephen D. Michel of Mount 
Pleasant, SC, with the intention of chartering it for short sailing 
tours. However, because the vessel was built in Canada, it does not 
meet the requirements for a coastwise license endorsement in the United 
States. Such documentation is mandatory to enable the owner to use the 
vessel for its intended purpose. Dr. Michel first sought to purchase a 
U.S.-built vessel, but this type of sailboat is not built by any U.S. 
shipbuilders. He has invested a considerable amount of money in this 
vessel, and without a Jones Act waiver, he will be forced to sell the 
boat.
  The owner of the Emerald Ayes is thus seeking a waiver of the 
existing law because he wishes to use the vessel in his chartering 
business. If he is granted this waiver, he intends to comply fully with 
U.S. documentation and safety requirements. The purpose of the 
legislation I am introducing is to allow the Emerald Ayes to engage in 
the coastwise trade and fisheries of the United States.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2199

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled, That 
     notwithstanding sections 12106, 12107, and 12108 of title 46, 
     United States Code, and section 27 of the Merchant Marine 
     Act, 1920 (46 App. U.S.C. 883), as applicable on the date of 
     enactment of this Act, the Secretary of Transportation may 
     issue a certificate of documentation for the vessel Emerald 
     Ayes, United States official number 986099.
                                 ______
                                 
      By Mr. BINGAMAN (for himself and Mr. Domenici):
  S. 2201. A bill to require the Administrator of the Environmental 
Protection Agency to make grants for the construction of certain 
treatment works, and for other purposes; to the Committee on 
Environment and Public Works.


                      treatment works act of 1994

  Mr. BINGAMAN. Mr. President, today I am introducing, along with my 
colleague from New Mexico, legislation which would provide desperately 
needed wastewater treatment to the South Valley in Bernalillo County, 
New Mexico, a small unincorporated community outside of Albuquerque, 
alongside the Rio Grande.
  The South Valley is an unincorporated community which for over 30 
years has suffered the health hazard of inadequate sewer and water 
facilities. The South Valley is more than 50 percent Hispanic and 
qualifies as one of the poorest communities in our country.
  Because of the South Valley's close proximity to Albuquerque, this 
community does not qualify for many of the existing programs designed 
to help rural communities. The South Valley is too large to qualify for 
rural water grants, but is too small to shoulder the high per household 
hook-up fees or monthly water and sewer service fees that would be 
necessary if they were to finance wastewater treatment construction 
through revenue bonds or other financing mechanisms.
  Most of the South Valley's 12,000 residents rely on septic tanks. 
Their drinking water comes from wells on their property. Heavily 
concentrated septic tanks, a shallow water table, and tight soils 
resulting in poorly drained septic tanks are contaminating the ground 
water in this area of our State. This problem continues to escalate as 
the population increases. Because the residents are low income, they 
cannot afford to have their aging septic tanks pumped as regularly as 
needed. Pumping costs at least $65 and some residents need to do it 
every 2 weeks which they simply cannot afford. For this reason, 
residents resort to pumping the liquid into their yards or into alleys 
or the septic tanks continue to release wastes into the ground. While 
residents have been fined, the problem persists. The result is 
contaminated drinking water which residents continue to drink because 
they have no other choice.
  There is no doubt that this area suffers from one of the most severe 
cases ever found in New Mexico of health-threatening pollution from 
septic tanks. Two years ago, fecal coliform was found in a local 
elementary school which shut down until bottled water could be provided 
to the students. Other schools continue to have to pump their septic 
tanks daily in order to avoid sewage rising to the ground surface. 
These residents are in desperate need of being connected to city water 
and sewer lines. It is imperative that we improve their quality of 
life--the health of every resident in the South Valley depends on it.
  State and local governments have already contributed significant 
funds to address the problem, but additional funding is needed. If this 
funding were to come through revenue bonds, residents in the area would 
have to pay four to six times as much as other New Mexico residents for 
monthly water and sewer service. These citizens cannot afford such 
rates. For this reason, legislation authorizing Federal aid for this 
project is imperative.
  Mr. President, specifically the legislation we are introducing today 
will authorize the Administrator of the Environmental Protection Agency 
to make one or more grants for the construction of a publicly owned 
treatment works in the South Valley.
  This authorization is critical in assuring that the South Valley have 
access to clean and safe water.
  I ask unanimous consent that the full text of this legislation be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2201

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. GRANTS FOR CONSTRUCTION OF CERTAIN TREATMENT 
                   WORKS.

       (a) In General.--The Administrator of the Environmental 
     Protection Agency shall make 1 or more grants in accordance 
     with title II of the Federal Water Pollution Control Act (33 
     U.S.C. 1281 et seq.) for the construction of publicly owned 
     treatment works in the South Valley of Bernalillo County, New 
     Mexico.
       (b) Funding.--The Administrator is authorized to use 
     $25,000,000 of funds made available to the Environmental 
     Protection Agency under the matter under the heading ``water 
     infrastructure/state revolving funds'' under the heading 
     ``Environmental Protection Agency'' in title III of the 
     Department of Veterans Affairs and Housing and Urban 
     Development, and Independent Agencies Appropriations Act, 
     1994 (Public Law 103-124; 107 Stat. 1294), to carry out this 
     section, to remain available until expended.

  Mr. DOMENICI, Mr. President, the bill that we are introducing today 
would authorize funding for the South Valley of Bernalillo County, NM. 
They need a wastewater system and an improved drinking water system. 
This area has been settled since the 1700's and includes the three 
historic villages of Atrisco established in 1692, Los Padillas 
established in 1703, and Pajarito established in 1699. The South Valley 
is home to 12,000 people. The vast majority are Hispanic and many are 
poor. More than half of the children attending the area's two main 
elementary schools were eligible for free lunches through the Federal 
school lunch program, indicating household incomes under 130 percent of 
the poverty level.
  For almost 30 years the South Valley community has suffered the 
health hazard of inadequate sewer and water facilities. Drinking water 
wells and septic tank leach fields are practically on top of each 
other. I am sure you can appreciate the tremendous health hazard this 
represents.
  The septic tanks in the South Valley are contributing to the ground 
water pollution. This could become a more serious problem in the future 
because the aquifer is the water supply for the entire Albuquerque 
area. Ground water contamination from septic tanks is usually caused by 
excessive nitrate concentrations in areas of dense residential 
development and can result in microbiological contamination of nearby 
drinking water wells. The South Valley has the characteristics usually 
associated with ground water contamination. It is just a matter of time 
and question of degree. These facts support the conclusion that the 
problem is getting worse and so is the general quality of life in the 
South Valley.

  I am aware that it would take more than $10 billion dollars to help 
every small community in need of a sanitary wastewater treatment 
system. Having served on the Senate Environment and Public Works 
Committee for years I appreciate the difficulty the committee faces. If 
there is one things harder than getting water out of a stone, it is 
getting enough money to help all of the communities with legitimate 
wastewater needs.
  The Appropriations Committee had made $500 million available for 
wastewater treatment for communities with special needs. That money is 
scheduled to become available this fall for projects that have been 
authorized.
  Taking $10 billion dollars worth of need and prioritizing the top 
$500 million is a thankless job.
  If the test is: Congress should help those who help themselves, the 
South Valley residents should be helped.
  If the test is: First come first served, the South Valley should be 
at the head of the line because it was the first project to get an 
authorization passed in the Senate in response to the Appropriations 
Committee's making the money available--subject to authorization. S. 
1685 passed the Senate in November of last year. In fact, a $25 million 
authorization for the South Valley passed the Senate twice on two 
different bills.
  If the test is taking a lemon and making lemonade, the South Valley 
should be at the head of the line because the community used its 
wastewater problem as a science project for the school children.
  If the test is: emergency, the South Valley should be funded.
  The situation is so bad there is almost a daily story in the New 
Mexico newspapers. ``South Valley Residents Blame Water for Girl's 
Illness''; ``Residents Learn to Live in Sewage''; ``Living in a 
Cesspool''; ``Girl's Illness May Remain Mystery,'' ``Pools of `Gray 
Water' surround Girl's Mobile Home''; and ``State seeks more extensive 
tests on the water from ill girl's house.''
  For almost 30 years this community has suffered deteriorating housing 
stock, and the health hazard of inadequate sewer and water facilities.
  The situation is so critical that there is a moratorium on building 
desperately needed multifamily housing units. These are units that 
could greatly improve the housing stock of the area.
  The wastewater needs of the South Valley are diverse and will require 
several different approaches. While these are the starkest examples, 
the valley's problems are diverse. Some parts of the valley are semi-
urban and could be hooked up to the Albuquerque city system. Other 
sections of the South Valley would be best served by community-cluster 
style constructed wetlands system. In the least densely populated areas 
of the South Valley it makes sense to continue on-site water wells and 
wasterwater disposal systems.
  Making lemonade out of a lemon. Two elementary schools and a 
community center in the South Valley were having to pump their septic 
tanks daily in order to avoid sewage rising to the ground surface. 
Bacteria were found in the well of one of the schools about 2 years 
ago. One of the schools, Los Padillas School had been using bottled 
water to drink and to prepare school lunches. The teachers used this 
dire situation to get the students interested in science. All of the 
kids learned about the dangers of unsafe drinking water and they 
learned about the constructed wetlands vacuum technology to treat their 
waste and to provide them with clean healthy drinking water.
  Helping those who help themselves. In these tight fiscal times, it 
can be said that Congress helps those who help themselves. If this is 
the test, South Valley should be helped. This community has been 
untiring in its efforts to help itself. So many times its efforts have 
been ignored or rejected.
  Nevertheless, its leaders should be commended. They never gave up.
  The leaders of South Valley and I have been meeting on a regular 
basis for 9\1/2\ years to develop an action plan to address this 
problem.
  There have been successes at the local level which include the 
following: In 1991, the Bernalillo County Commission adopted a one-
eighth cent tax on gross receipts in and for the unincorporated area of 
the South Valley to finance solid waste, water and sewer. In the 2 
years that this levy has been on the books, $1.5 million has been 
raised in annual revenue and $900,000 has been designated to assist 
residents in hooking up to water and sewer systems already in place. 
Some of this $900,000 has been used to upgrade substandard onsite wells 
or septic systems.
  A partnership in the making. The city of Albuquerque, in partnership 
with Bernalillo County, has contributed its resources in the areas of 
research planning and education. The University of New Mexico, 
Institute of Public Law, provided a joint study for the New Mexico 
Legislature which led to an appropriation of funds for this project.
  I want to particularly recognize the hard work in New Mexico at the 
State legislature and in local government. Speaker of the House, Ray 
Sanchez; Senate President pro tem, Manny Aragon; State Representative 
Kiki Saavedra, State Representative Lelano Garcia, former county 
commissioner Orlando Vigil, county commissioner Al Valdez, and county 
manager Juan Vigil have all worked tirelessly. As a result of their 
efforts the New Mexico Legislature appropriated $4 million in 1992; $5 
million in 1993; and $8 million in 1994 demonstrating the seriousness 
of the problem and the State's commitment to a solution.
  Users of a new system will also bear a portion of the burden for the 
improvements. If the city is the provider, total user fees may total 
almost $3,500 for hookup to both water and sewer service. These costs 
do not include the cost to extend lines from the house to the water 
meter and sewer stubout. While average incomes range from $18,000 to 
over $40,000 per household it would be difficult for most homeowners to 
pay these substantial costs out-of-pocket to ensure a sanitary liquid 
wastewater disposal system and safe drinking water supply.
  Given the magnitude of the costs, grants and direct appropriations 
are needed in order to keep rates from being prohibitively high; the 
revolving loan fund has not been used because there is no way the 
resident's could pay back the loan; the rates would be so high that the 
people who need the wastewater system could not afford it. The South 
Valley is not part of Albuquerque city and city officials believe that 
the city is already subsidizing the South Valley residents.

  In addition, the revolving loan program cannot make a long-term 
commitment for future funding of a phased project; and funds for both 
water and sewer problems are needed.
  Clearly the legislature is doing its part in this worthy partnership 
which would use both State resources and Federal resources. Even with 
the State appropriations the South Valley still needs $35 to $40 
million to meet its water and sewer treatment needs--$25 million for 
the wastewater portion.
  Dozens of programs on the books but none of them can help the South 
Valley. Over the years, the South Valley community has investigated 
using the State revolving loan fund, Economic Development 
Administration programs, rural development programs under the 
Department of Agriculture, all of the EPA programs, HUD programs, and 
the Community Development Block Grant program. The South Valley is 
ineligible for all of them because it is either too close to 
Albuquerque and therefore not rural enough, or too close to Albuquerque 
and therefore, when viewed as a region, is too well off and not poor 
enough. Or the needs of the South Valley are too big and would swallow 
up entire programs' nationwide budgets. Frankly, the existing programs, 
with their restrictions about being too urban or too well off aren't 
too important. It has simply been too long since the Federal Government 
joined the State and local partnership.
  The Senate has passed a South Valley authorization. Last year, the 
Senate passed S. 1685 which authorized this project. This 
authorization, if it is enacted into law, will end 30 years of 
frustration, denial, and avoidable health problems in this community.
  The bill we are now introducing would accomplish the same thing--
authorize $25 million for the wastewater needs of the South Valley. I 
hope the Senate will be considering the Clean Water Act legislation 
some time in the near future. At that time we intend to offer this bill 
as an amendment to the clean water reauthorization.
                                 ______
                                 
      By Mr. DURENBERGER:
  S. 2204. A bill to provide authority for the NRC to recover costs of 
regulating agreement State programs; to the Committee on Environment 
and Public Works.


            the nuclear regulatory commission fee equity act

  Mr. DURENBERGER. Mr. President, I introduce legislation, S. 2204, to 
rectify a grave inequity facing nuclear material users in the State of 
Minnesota, and many other States.
  As you know, the Nuclear Regulatory Commission is required by law to 
collect 100 percent of its budget authority from its users. This means 
that nuclear reactors, industries, and physicians in nuclear medicine 
must pay an annual fee to the NRC to cover the cost of their own daily 
regulation.
  In addition, these fees are used to regulate fee-exempt agencies such 
as educational institutions and federal facilities, to develop and 
manage low level waste disposal facilities, and to fund international 
efforts to promote U.S. nuclear nonproliferation goals.
  Finally, these fees are used to fund oversight monitoring of 29 
States which are currently exempt from all fees. These States are 
getting a free ride on the 21 other States which pay for NRC 
regulation. This, Mr. President, is a great injustice.
  The 29 exempt States have entered into an agreement with the NRC to 
manage their own nuclear waste users on the State level, thus 
eliminating the need for NRC regulation. These States are exempt from 
NRC fees. However, these 29 States also benefit from the fees paid by 
the nonagreement States. The NRC must provide the administration and 
oversight of the agreement program. This means reviewing and approving 
new agreements, providing training and inspection services, and 
performing periodic reviews of the programs.
  That means that non-agreement States, such as Minnesota, pay three 
times more than the benefits they receive. Last year, a total of $18.8 
million paid by users in nonagreement States actually funded NRC 
activities directly benefiting users in agreement states.

  Currently, more than 7 million clinical procedures using radioactive 
material are performed each year. And with a 1,400 percent increase in 
nuclear medicine fees over the last 4 years, 2,700 NRC licensed users 
have dropped their license since 1991--directly affecting the health 
and well-being of those dependent on the medical licensees.
  Both former President and Mrs. Bush were treated with nuclear 
medicine when they received treatment for Graves disease. But when 
nuclear physicians are forced to pass along the astronomical cost of 
NRC user fees to their patients, these services cease being available 
to those who are unable to pay for them.
  Even the NRC itself, in a report to Congress dated February 1994, 
acknowledged the unfair burden being placed on licensees in 
nonagreement States. I quote from that report:

       To address the fairness and equity concerns related to 
     licensees paying fees for activities not benefitting them, 
     laws and NRC fee policy must be changed to assess all 
     beneficiaries of NRC activities fees that are commensurate 
     with the cost of those NRC activities.

  Mr. President, the bill I propose today would do just that. It would 
rectify this injustice by charging all States fees commensurate with 
the benefits they receive from the NRC. This will not place a great 
burden on the agreement States, but will ensure that they pay for 
services rendered. Their fees will continue to be far less than 
nonagreement States.
  This legislation should be noncontroversial. My intention is to offer 
it as an amendment to the NRC reauthorization bill to be marked up next 
week.
                                 ______
                                 
      By Mr. HATCH:
  S. 2205. A bill to amend the Social Security and the Internal Revenue 
Code of 1986 to provide improved access to quality long-term care 
services, to obtain cost savings through provider incentives and 
removal of regulatory and legislative barriers, to encourage greater 
private sector participation and personal responsibility in financing 
such services, and for other purposes.


                   quality care for life act of 1994

  Mr. HATCH. Mr. President, I rise today to introduce legislation that 
deals with an important and necessary aspect of health care reform--
long-term care.
  Long-term care has been a difficult piece of the health care reform 
puzzle. Policymakers have been reluctant to address it for a number of 
reasons. Since long-term care does not fit neatly into theories of 
``managed competition'' or into ``health alliances,'' a number of 
health care reform proposals leave it out altogether. Because a new 
all-encompassing government entitlement to long-term care would cost 
tens of billions of dollars a year, even those who favor such an 
entitlement despair of enacting new long-term care benefits as part of 
health care reform.
  I do not believe, Mr. President, that since we cannot do it all for 
everyone--that we must settle for doing nothing for anyone.
  The legislation I am introducing today, the ``Quality Care for Life 
Act,'' is a measured and balanced attempt to marry a widened and 
strengthened long-term care safety net with measures to marshal private 
sector resources for long-term care. It is only through laying the 
foundations for such a public/private partnership for long-term care 
now that our society will be prepared 10, 20, and 30 years hence to 
meet the long-term care needs of a growing elderly population.
  Last week, the Labor and Human Resources Committee concluded 
consideration of the Health Security Act. Included in the Chairman's 
bill is language to create a new federal long-term care program. One 
part is a capped grant program ``State Programs for Home and Community 
Based Services for Individuals with Disabilities.'' This would be 
accomplished through a federal-state matching system. The second part 
is for ``Children with Special Needs,'' a new program for children who 
do not meet the requirements of the overall plan and who do not qualify 
for Medicaid. The third part, ``Life Care,'' is a new fully federalized 
program of long-term care for individuals over 35.
  While I agree with the intent of these programs, I do not believe 
they present the best approach to address our nation's long-term care 
needs.
  First, they are far too expensive. It is clear that we are going to 
have to invest greater resources in long-term care. However, in making 
that investment, we must make sure that we invest wisely, and offer 
solutions that address the need in a constructive manner.
  Second, the Labor Committee bill does not embody true reform: all 
this proposal does is create yet more government programs modeled after 
previous and ineffective government programs.
  I am proposing something different. The legislation I am introducing 
today meets the same goals as the Health Security Act approved by the 
majority of the Labor Committee, yet it accomplishes them through a 
more targeted and cost-efficient approach.


            the need for change in long-term care financing

  Our society, individually and collectively, has not made adequate 
provision for financing the costs of long-term care. Individuals and 
families are not saving for, or insuring themselves against, the costs 
of long-term care. The federal/state Medicaid program is stretched to 
the breaking point. Families and governments are going broke.

  Without action to address these problems, our growing elderly 
population will come to rely much more heavily on Medicaid to pay for 
long-term care. Medicaid is currently the primary source of funding for 
approximately one half of all nursing home residents, and that will 
increase to 60 percent by 2002, with Medicaid paying for at least some 
portion of the costs for nearly 75 percent of all nursing home 
residents.
  If current trends continue unchecked, Medicaid will be burdened with 
an ever-increasing share of the nation's long-term care costs as the 
baby boomers reach retirement. But these current trends cannot 
continue. Federal and state budgets--already strained badly by current 
Medicaid long-term care obligations--cannot bear such costs. Nor would 
the elderly be well served by an overwhelmed publicly financed program.
  A February 1993 Gallup Organization survey indicated that 76 percent 
of Americans agree that ``government should pay the cost of nursing 
home care only for those who cannot afford it.'' In order to meet the 
nation's growing long-term care needs without both emptying the public 
purse and sacrificing quality of care, our society cannot afford to 
rely solely on government.
  Instead, we must encourage and enforce an expectation of personal 
responsibility on the part of those with the means to plan for and pay 
for potential long-term care costs. Government can--and must--help in 
this effort by working to see that individuals have the information and 
resources to accept responsibility for meeting their own long-term care 
needs.


         long-term care costs are impoverishing senior citizens

  Most elderly Americans are unaware of the magnitude of long-term care 
costs and of the limits of government assistance. Most Americans do not 
foresee needing long-term care. Most probably do not realize how costly 
months or years of long-term care can be. Many Americans wrongly assume 
that government programs or their general health insurance will cover 
the costs of any long-term care services they might need.
  For all these reasons, individuals and families face long-term care 
costs for which they have not planned and which they cannot afford.
  The cost of long-term care can quickly wipe out the assets of those 
who have worked and saved for a lifetime. The cost of one year of 
nursing home care is more than triple the average annual income for an 
elderly American. But the nation's current long-term care policy does 
not promote personal planning, saving, or the purchase of insurance 
against the financial risk of long-term care costs.
  Nor does our nation provide comprehensive social insurance against 
the financial catastrophe of long-term care costs. Only after a long-
term care recipient has been impoverished does government assistance 
become available through Medicaid--a ``welfare'' program.


      medicaid is impoverishing the federal and state governments

  According to the Health Care Financing Administration [HCFA], total 
Medicaid spending (state and federal) has doubled over recent years--
from $48.2 billion in FY 1987 to $96.4 billion in fiscal year 1991. 
Medicaid cost almost $150 billion last year. If current trends hold, 
HCFA projects that total Medicaid spending could rise to $230 billion 
in FY 1997.
  The strain of the unaffordable growth in Medicaid spending 
jeopardizes the accessibility and quality of both acute and long-term 
care for those who must depend on Medicaid. Clearly, if current long--
term care needs have stretched federal and state budgets to their 
limits, future needs will overwhelm our current arrangements for long-
term care financing. Therefore, the nation must look to other sources 
than government for additional resources to meet the future long-term 
care needs of an aging population.
  I believe that long-term care reform should have the following goals: 
providing appropriate access to the full continuum of long-term care 
services; ensuring that all Americans have the means to meet the cost 
of long-term care; moving individuals and families away from dependence 
on government welfare programs for long-term care financing; and 
addressing the nation's long-term care needs in a fiscally responsible 
way.


              the role of private long-term care insurance

  Results from a March 1993 Gallup Organization survey indicated that 
79 percent of Americans agree that ``to keep government costs as low as 
possible, private insurance should play a more active role in paying 
for nursing home bills for most Americans.''
  Private insurance, so useful in protecting individuals and families 
from such costly misfortunes as accidents and illness, has great 
potential for marshalling private sector resources to meet long-term 
care costs. Insurance offers a very good means to preserve an 
individual's choice from among various long-term care arrangements and 
competing providers. Its expanded use would make an appropriate 
private/public long-term care partnership viable. It has great 
potential for lessening the long-term care cost burden that the graying 
of America will otherwise put on the American taxpayer.
  To date, private insurance accounts for less than two percent of all 
payments for long-term care services. I am confident, however, that 
with appropriate changes in federal policies private long-term care 
insurance can and will take on a larger role in meeting long-term care 
costs. In order to expand the role of private insurance, a number of 
things must change. Chiefly, long-term care insurance policies must 
have value to consumers.
  In order to enhance the value of long-term care insurance to 
consumers, the ``Quality Care for Life Act'' would: establish federal 
standards and consumer protections; clarify the federal tax treatment 
of long-term care insurance; and educate Americans about the risk of, 
cost of, and means of financing long-term care.
  In addition, this legislation would make the laws tighter on asset 
transfers so that people cannot avoid their personal responsibilities 
by protecting unreasonable amounts of their personal funds from 
legitimate nursing home expenses, thus shifting the burden to 
taxpayers.


       federal long-term care standards and consumer protections

  Appropriate federal standards and consumer protections for long-term 
care insurance would inspire consumer confidence, foster the growth of 
the private long-term care insurance market, and ensure that elderly 
consumers are spared the problems that once plagued the ``Medigap'' 
insurance business. Accordingly, my bill would establish federal 
standards to ensure appropriate policy design and sales practices.


      clarification of the tax status of long-term care insurance

  The ``Quality Care for Life Act'' would make the following 
clarifications to the tax treatment of long-term care insurance:
  Treatment of long-term care insurance premiums paid by individuals in 
the same manner as accident and health insurance premiums;
  Treatment of benefits received under long-term care insurance 
contracts for long-term care services in the same manner as benefits 
received under accident and health insurance;
  Treatment of employer plans providing long-term care services in the 
same manner as accident or health plans;
  Treatment of life insurance benefits paid to a terminally ill 
individual in the same manner as death benefits;
  Inclusion of long-term care options as preferred employee benefits in 
employer programs, including cafeteria plans; and
  Clarification of the allowance of tax deductions for additions to an 
insurer's long-term care insurance reserves.
  The private long-term care insurance market is growing and improving. 
Products have evolved and improved. Insurance companies have gained 
experience and expertise in designing and pricing policies. Sales have 
been rising by 30-35 percent a year over recent years. There have been 
some two million long-term care policies purchased.
  I believe that the private long-term care insurance market is on the 
way to realizing its potential. With the right kind of federal 
standards, consumer protections, tax clarifications, and public 
education, consumers will come to understand the value of long-term 
care insurance. Private insurance can then become a full partner in a 
private/public long-term care partnership.


         expansion of home- and community-based long-term care

  Today, about 6 million older Americans living at home need assistance 
in everyday activities as a result of their disabilities. As we in 
Congress debate health care reform legislation, we must also prepare a 
health care system that addresses our current inequities in access and 
costs, while laying the foundation for addressing our long-term care 
demands of today and tomorrow.
  The ``Quality Care for Life Act'' also establishes a home and 
community based service program for disabled persons who either need 
assistance with three activities of daily living or who suffer from 
Alzheimer's disease or related cognitive disorder.
  The bill also revises the reimbursement system to create a payment 
level for subacute care in nursing homes, thus increasing access for 
those patients who need that level of care but are unable to get that 
care in community nursing facilities because the costs for providing 
the service are much higher than the current skilled nursing home daily 
rate. Currently, these services are provided by hospitals at a much 
higher cost. Finally, the bill provides for a prospective payment 
system for nursing facilities.

  By the year 2030, there will be more elderly than young people, and 
the population age 85 and over is expected to more than triple in size 
between 1980 and 2030. My home state of Utah has the fastest growing 
population over 80 in the country.
  We simply do not have the necessary federal resources to provide all 
Americans with every benefit they need. An aging population will 
significantly increase demand for long-term care services. Planning 
today will save us from bankruptcy and a lack of services tomorrow.
  I believe the greatest barrier to enacting long-term care legislation 
has been its substantial cost. Although any proposal will entail new 
costs, I have constructed the ``Quality Care for Life Act'' to place 
maximum reliance upon the private sector wherever possible, in order to 
leverage our resources since we will be providing new services. It is 
true that my bill will entail new spending in the short-run, but these 
funds are an investment which will achieve greater savings over the 
long-run.
  Some of the costs will be incurred because we are establishing a 
floor for home health services, so that the most frail and sick of our 
elderly population are guaranteed home care now. Currently, many fall 
through the cracks of our care system. They lack adequate home care and 
are denied access to adequate nursing home services.
  We all know that the amount and duration of home care services varies 
from state to state and also varies within state areas between urban 
and rural areas. But this is not fair to our frail elderly, and we have 
a responsibility to see that all Americans, regardless of where they 
live, can receive the home care services they need and deserve.
  If we help them now, and provide the kinds of home care services they 
need, they may never need to be in a nursing home and may never be a 
long-term drain on scarce federal financial resources. We can do the 
right thing, and do it now. If we do not act soon, we will be 
mortgaging our children's future to pay for our own long-term care 
needs.
  I intend to work with the other members of this body so that we can 
provide our nation's elderly the care they so badly need and deserve. I 
think that the ``Quality Care for Life'' proposal would meet that goal, 
and I hope my colleagues will give it serious consideration.
  I ask unanimous consent that a section-by-section explanation of the 
bill be inserted in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                 The Quality Care for Life Act of 1994


                            General overview

       The Quality Care for Life Act of 1994 creates a public/
     private partnership designed to ensure appropriate long term 
     care for all Americans without forced impoverishment. Among 
     other goals, the proposal calls for:
       (1) An increased emphasis on private long term care 
     insurance by instituting consumer protections and tax 
     incentives designed to spur the purchase of such insurance;
       (2) Maintaining and strengthening the existing long term 
     care financing safety net by maintaining the current Medicare 
     benefit with some modifications, incorporating managed care 
     concepts into the delivery of long term care, designing a 
     payment system based on patient needs, and proposing 
     modifications to the Medicaid system designed to prevent 
     family impoverishment while strengthening Medicaid asset 
     transfer and lien provisions which protect the system from 
     abuse; and
       (3) Acknowledging the realities of shifting patient 
     populations by encouraging the development of subacute care 
     programs in less costly nursing facility environments while 
     simultaneously promoting the development of home and 
     community-based services for a certain segment of the long 
     term care population.


                       section-by-section summary

       The Quality Care for Life Act of 1994 proposes amendments 
     to the Social Security Act and the Internal Revenue Code of 
     1986, as summarized below:
       Section 1. This section designates the act as ``The Quality 
     Care for Life Act of 1994.''
       Section 2. This section defines the purposes of the bill as 
     establishing a prospective payment system for nursing 
     facilities under all federal health programs; encouraging the 
     use of cost-effective subacute care in nursing facilities; 
     clarifying the federal tax treatment of long term care 
     insurance and developing standards for such insurance; 
     modifying eligibility under the Medicaid program to account 
     more accurately for individual assets: establishing home and 
     community-based services for Medicaid beneficiaries; and 
     revising Medicaid asset transfer prohibitions to close 
     certain loopholes existing under current law.

       Title I. Prospective Payment System for Nursing Facilities

       Section 100. Establishes this section's short title as the 
     ``Prospective Payment System for Nursing Facilities 
     Amendments of 1994'' (amending Titles XVIII and XIX of the 
     Social Security Act).
       Section 101. Establishes definitions applicable to this 
     title which relate to development of a prospective payment 
     system.
       Section 102. Establishes payment objectives for the 
     prospective payment system, including an equitable balance 
     between cost containment and quality of care; admission of 
     residents without regard to income; admission of patients 
     with greater acuity; administrative simplicity in the payment 
     system; and encouraging facilities to invest in buildings and 
     improvements to maintain quality and access.
       Section 103. Authorizes the Secretary of HHS to promulgate 
     all rules and regulations necessary to implement a 
     prospective payment system (``PPS''), requires that payment 
     rates reflect the objectives of the proposal, and allows the 
     Secretary to require submission of data, statistics and 
     similar information by nursing facilities needed to implement 
     a PPS.
       Section 104. Clarifies that no portion of this title 
     affects of replaces the existing Medicare skilled nursing 
     facility benefit and that HCFA rules governing allowable 
     costs continue to apply except to the extent they conflict 
     with provisions of this title.
       Section 105. Requires the Secretary to establish a resident 
     classification system for reimbursement purposes which 
     reflects the costs required to care for nursing facility 
     residents based upon their individual care needs. The system 
     must assign relative weights to classes of residents based on 
     the relative value of resources needed to care for that class 
     and must take into account geographic variations in cost.
       Section 106. Establishes five cost centers which the 
     Secretary must consider in determining payment rates--nursing 
     service costs, administrative and general costs, fee-for-
     service ancillary services costs, selected ancillary services 
     and other costs, and property costs. Requires that nursing 
     facilities be paid:
       (1) A prospective, facility-specific, per diem rate based 
     on the sum of the cost centers for nursing services, 
     administrative and general costs, and property costs;
       (2) A facility-specific prospective rate for each unit of 
     fee-for-service ancillary services; and
       (3) On a retrospective basis for selected ancillary 
     services and other costs.
       Section 107. Requires the facility to perform a resident 
     assessment, as defined under the Omnibus Reconciliation Act 
     of 1987, within 14 days of admission and at other intervals 
     as required by that law. This assessment shall be used to 
     ascertain the resident class of each resident in the facility 
     for purposes of determining the per diem rate for the nursing 
     service cost center.
       Section 108. Establishes a methodology for determining the 
     per diem rate for the nursing service cost center under the 
     prospective payment system based on the facility's case mix 
     and nursing service costs for a specified time period. 
     Includes an acuity payment for certain heavy care residents, 
     allows the Secretary of HHS to establish geographic ceilings 
     on rates, and requires the Secretary to establish procedures 
     allowing for exceptions to the geographic ceilings based on 
     certain designated factors.
       Section 109. Establishes a methodology for determining the 
     per diem rate for administrative and general costs. Requires 
     establishment of a prospective, facility-specific, per diem 
     rate based upon a comparison of administrative and general 
     costs of facilities in a designated geographic region to 
     costs incurred by the facility in question (i.e. a comparison 
     of facility-specific costs to a percentage of costs in a 
     designated region). The rate must include an efficiency 
     incentive for facilities with indexed costs meeting certain 
     criteria.
       Section 110. Requires the Secretary to pay prospective, 
     fee-for-service rates for certain ancillary services 
     (physical therapy, occupational therapy, speech therapy, 
     respiratory therapy, hyperalimentation, and complex medical 
     equipment) based on a facility's actual costs indexed forward 
     using a designated tool for predicting inflation.
       Section 111. Requires the Secretary to reimburse the cost 
     of selected ancillary services and other costs (e.g. drugs, 
     medical supplies, etc.) on a retrospective basis as pass-
     through costs. The Secretary must establish charge-based 
     interim rates subject to year-end reconciliation based upon 
     the facility's Medicare cost report.
       Section 112. Requires the payment of rates for the property 
     cost center on a prospective, facility-specific, per resident 
     rate based on the fair asset value of the property. 
     Establishes rules for determining the fair asset value of the 
     property. Provides for annual reappraisal of the value of 
     land, buildings and fixed equipment and removes sales 
     transactions, refinancing or other changes in financing as 
     considerations in establishment of the rate. Requires the 
     Secretary to establish a per bed limit on the fair asset 
     value of a nursing facility for each geographic region. 
     Establishes the per resident day rental as the per diem rate 
     for this cost center and creates a formula for determining 
     the per resident day rental. Establishes a modified rate 
     for newly-constructed facilities during their first year 
     of operation and clarifies the treatment of facilities in 
     operation prior to the effective date of this title.
       Section 113. Requires the Secretary to establish, by 
     regulation, a procedure for granting mid-year rate 
     adjustments for the nursing service, administrative and 
     general, and fee-for-service ancillary cost centers. The 
     procedure must require the Secretary to make adjustments on 
     an industry-wide basis where there are statutory or 
     regulatory changes affecting nursing facilities, changes in 
     the federal minimum wage, or general labor shortages with 
     significant regional impact. The procedure must allow the 
     Secretary to grant adjustments, upon request, by individual 
     facilities or groups of facilities based upon local labor 
     shortages, regulatory changes affecting only a subset of the 
     industry, natural disasters or other events beyond the 
     control of the facility with economic consequences, or other 
     cost-producing factors (excluding changes in the facility's 
     case-mix) which the Secretary specifies in regulation. This 
     section also requires a facility seeking a discretionary 
     adjustment to make certain minimum showings of financial 
     impact to qualify for the adjustment.
       Section 114. Establishes special reimbursement rules for 
     low volume and new nursing facilities. Allows low volume 
     facilities (those with less than 2500 Medicare Part A days 
     per year) to elect either a retrospective reimbursement 
     system based on cost reports submitted or a per diem based on 
     the medium in that geographic region of each of the five cost 
     centers. New facilities (those newly constructed, licensed 
     and certified, or those having less than three years 
     participation as a Part A Medicare provider) may elect to be 
     reimbursed under the same systems as low volume providers or 
     on a retrospective pass-through basis for all five cost 
     centers.
       Section 115. Allows any person or entity aggrieved by a 
     decision of the Secretary under this title, where the amount 
     in controversy equals or exceeds $10,000, to appeal to the 
     Provider Reimbursement Review Board under procedures set 
     forth at Section 1878 of title XVIII of the Social Security 
     Act and related regulations.
       Section 116. Makes the title effective as of October 1, 
     1995.

          Title II. Subacute Care Continuum Amendments of 1994

       Section 200. Defines the purpose of the act which is to 
     remove statutory and regulatory barriers to the provision of 
     quality, cost-effective subacute care in skilled nursing 
     facilities (SNFs), and to establish appropriate payment for 
     such care under Medicare.
       Section 201. Establishes definitions applicable to this 
     title which relate to subacute care.
       Section 202. Prohibits the Secretary or the States from 
     limiting SNFs from providing subacute care services under 
     Medicare and Medicaid. Requires a ``level playing field'' to 
     encourage the development of cost-saving, quality subacute 
     care.
       Section 203. Requires the Secretary to establish an 
     expedited atypical exceptions process for SNFs by January 1, 
     1996 whereby SNFs would be granted interim exceptions within 
     90 days of submission of an exceptions request accompanied by 
     data and documentation determined by regulation. Provides for 
     reimbursement of any overpayments or underpayments during the 
     exception period and is automatically implemented if the 
     Secretary fails to act.
       Section 204. Provides that payments to physicians for 
     visits to patients of similar acuity shall be the same for 
     hospitals and SNFs regardless of site of service.
       Section 205. Provides that respiratory therapists shall be 
     reimbursed under Medicare for services provided in SNFs.
       Section 206. Requires the Secretary to review the provision 
     of subacute care in SNFs and determine which hospital DRGs 
     are appropriate for SNFs to provide such care with 
     appropriate copayments by October 1, 1995. By October 1, 
     1996, the Secretary shall publish a list of applicable DRGs 
     with appropriate hospitalization periods and copayments and 
     rebase Medicare payments for such groups to reflect the lower 
     cost of such care provided in SNFs.
       Section 207. Provides for eligibility under Medicaid and 
     encourages states to develop methodologies under Medicaid to 
     provide subacute care in furtherance of the findings in 
     Section 100.
       Section 208. Provides that all provisions in this act shall 
     supersede any other provisions in Medicare or Medicaid which 
     are inconsistent with this act.
       Section 209. Establishes an effective date of January 1, 
     1996.

              Title III. Long Term Care Tax Clarification

       The goal of this title is to clarify the tax treatment of 
     long term care insurance in order to foster the development 
     and growth of the private insurance market. In addition, the 
     legislation clarifies the tax treatment of long term care 
     riders to life insurance policies. This title clarifies that 
     all long-term care services (medical care and personal care) 
     are treated as medical expenses under the tax law. This means 
     that:
       1. Long-term care expenses and insurance premiums would be 
     tax deductible (above 7.5 percent of AGI);
       2. Payments under long-term care insurance policies would 
     not be taxable when received; and,
       3. Employer-paid long-term care insurance would be a tax-
     free employee fringe benefit.
       The bill also clarifies that insurance companies can deduct 
     reserves which have been set aside to pay benefits under 
     long-term care policies.
       Section 301. Establishes the short title as the ``Private 
     Long Term Care Insurance Incentive Act of 1994.''
       Section 302. Creates a new section (section 7702B) defining 
     long term care insurance contracts. It provides that employer 
     contributions are deductible and that per diem payments and 
     payments for services qualify. Specifies that the only 
     insurance provided is for long term care services and that 
     contracts must be renewable and have no cash surrender value. 
     Life insurance policies may offer long term care insurance 
     riders which qualify under this title.
       Defines qualified long term care services as diagnostic, 
     preventive, therapeutic, rehabilitative and personal care 
     services required by ill individuals provided pursuant to a 
     plan of care prescribed by a licensed health care 
     practitioner. A chronically ill person is one who cannot 
     perform two or more activities of daily living (bathing, 
     dressing, toileting, transfer, eating and continence).
       Specifies that employer plans are not deferred 
     compensation. Contracts may cover parents and grandparents as 
     if they were dependents.
       Section 303. Specifies that qualified long term care 
     services are treated as medical care and policy benefits are 
     excludable from the taxable income of individuals.
       Section 304. Specifies that qualified long term care 
     insurance contracts may be offered through a cafeteria plan 
     as long as the premiums are level annual premiums and the 
     employee may elect to continue coverage after leaving the 
     employer.
       Section 305. Benefits paid in excess of $250 per day, 
     indexed for inflation, are included in the income of the 
     beneficiary and subject to normal income tax.
       Section 306. Requires that qualified long term care 
     insurance tax reserves shall be in the amount the National 
     Association of Insurance Commissioners (``NAIC'') specifies 
     or, if the NAIC does not specify a method or amount, one year 
     full preliminary term method shall apply.
       Section 307. Provides that the amendments made by this 
     title shall apply to all taxable years after enactment and 
     that policies that met the NAIC standards when issued would 
     be considered qualified long term care policies.

              Title IV. Long Term Care Insurance Standards

       Section 401. Requires Congress to appoint an advisory board 
     known as the National Long-Term Care Insurance Advisory 
     Council. Establishes the size of the board and general 
     requirements for members. Establishes the responsibilities of 
     the board which include advising Congress on matters relating 
     to long term care insurance; collecting and disseminating 
     information on long term care insurance to providers, 
     consumers and regulatory bodies; developing proposed models, 
     standards and requirements for consideration by Congress; and 
     monitoring the development of the long term care insurance 
     market.
       Also provides specific list of activities in which the 
     board is authorized to engage and authorizes annual 
     appropriation of $1.5 million.
       Section 402. Provides that in order to receive favorable 
     tax treatment, long-term care insurance policies would have 
     to meet certain consumer protection standards. These 
     standards include the following provisions of the NAIC Model 
     Act and Regulation (as of January, 1993) regarding:
       1. Guaranteed renewability/protection from cancellation;
       2. Limitations/exclusions;
       3. Extension of benefits;
       4. Continuation/conversion of coverage;
       5. Discontinuance/replacement of policies;
       6. Unintentional lapse;
       7. Disclosure;
       8. Post-claims underwriting;
       9. Minimum standards;
       10. Mandatory offer of inflation protections;
       11. Pre-existing conditions/probationary periods; and
       12. Prior hospitalization.
       In addition to the NAIC standards, policies must also 
     provide for:
       1. Disclosure of whether the policy meets the requirements 
     for tax treatment;
       2. Mandatory offer of a non-forfeiture benefit (non-cash 
     only);
       3. Rate stabilization; and
       4. No sale to Title XXI beneficiaries.
       Section 403. Requires that policies also meet provisions of 
     the model act dealing with the following requirements:
       1. Application forms/replacement coverage;
       2. Reporting requirements;
       3. Filing requirements for marketing;
       4. Standards for marketing;
       5. Appropriations of recommended purchase;
       6. Standard format outline of coverage;
       7. Delivery of a ``shopper's guide;''
       8. Right to return;
       9. Certificates under group plans;
       10. Policy summary;
       11. Monthly reports on accelerated death benefits; and,
       12. Incontestability period; and
       13. Information on claim denials.
       Establishes a system of penalties for persons who fail to 
     meet the requirements of this title in issuing long term care 
     insurance policies.
       Defines long term care insurance policy as any policy or 
     rider advertised, marketed, offered or designed to provide 
     for designated services in a setting other than an acute care 
     setting on an expense incurred indemnity, prepaid or other 
     basis.
       Section 404. Allows policies deemed to be consistent with 
     this title by the insurance commissioner of one state to be 
     sold in any other state.
       Section 405. Directs the National Advisory Council to 
     develop recommendations for the use of uniform language and 
     definitions in long term care insurance policies, except to 
     the extent nonuniform language is needed to account for the 
     differences among states in licensing providers of long term 
     care.
       Section 406. Makes the amendments contained in section 401 
     applicable to policies issued after December 31, 1994, and 
     the amendments of section 402 applicable to actions taken 
     after December 31, 1994.

                Title V. Financial Eligibility Standards

       Section 501. This section modifies the existing Medicaid 
     financial eligibility standards for nursing facility care 
     under title XIX of the Social Security Act by:
       (1) Making an individual ineligible for Medicaid if his 
     resources, or those owned jointly with a spouse, exceed the 
     median price of a home in the geographic region where the 
     individual lives (the Secretary must establish a valuation 
     system for single family home in appropriate geographic 
     regions);
       (2) Counting the assets of an individual which are owned 
     jointly with a spouse in determining eligibility;
       (3) Including in countable assets all real property owned 
     by the person including a primary residence; all personal 
     property owned by the person including automobiles; and all 
     liquid assets held by the person including the asset value of 
     any trusts established by him.
       This section also requires the Secretary to provide grants 
     to states for demonstration projects which investigate the 
     coordination of private long term care insurance with 
     Medicaid eligibility requirements.
       Section 502. Makes this title effective on January 1, 1995.

    Title VI. Establishment of Program for Home and Community-Based 
           Services for Certain Individuals With Disabilities

       Section 600. Establishes short title of ``Home and 
     Community-Based Services for Individuals with Disabilities 
     Program Amendments of 1994.''
       Section 601. Requires all states participating in the 
     Medicaid program to establish a program of home and 
     community-based services for eligible disabled beneficiaries 
     in which a specified list of services is available to all 
     qualifying persons, except to the extent the person receives 
     identical services under any other government program.
       Defines eligible persons as those who (1) require some 
     assistance with three or more activities of daily living 
     (eating, toileting, dressing & bathing, transferring and 
     walking) and will likely require such assistance for at least 
     100 days; or (2) have moderate cognitive or mental impairment 
     as determined by either standard mental status protocols or 
     symptoms of behavioral problems as specified by the Secretary 
     and will likely have such condition for at least 100 days; or 
     (3) both.
       Requires an initial screening of all persons who appear 
     reasonably likely to meet the above conditions using a 
     uniform protocol specified by the Secretary. Also requires 
     periodic reassessment after a significant change in condition 
     or within six months of the last assessment. Also requires 
     assignment of a qualified case manager to each beneficiary 
     receiving these services and development of an individualized 
     written care plan meeting criteria minimum components of the 
     required care plan.
       Requires the case manager, in consultation with the 
     patient, and patient's family and primary medical provider, 
     to arrange for or provide the necessary services in a cost-
     effective manner, consistent with quality, and to assist in 
     making arrangements for delivery of care and implementation 
     of the care plan. The case manager may also be required by 
     the State to assist the patient in obtaining noncovered 
     services, either through private funds or other available 
     public programs.
       Clarifies that coverage under this title is an option 
     available to the individual, is not mandatory, and refusal to 
     accept it does not disqualify the individual from care in a 
     nursing facility, skilled nursing facility, or intermediate 
     care facility for the mentally retarded. Requires the case 
     manager to honor the choices of the individual where 
     possible.
       Requires that the State's plan for home and community-based 
     services specify how these benefits will be coordinated with 
     benefits under Titles V and XX of the Social Security Act, 
     and applicable portions of the Housing and Urban Development 
     Act, the Older Americans Act of 1965, and other programs 
     which provide services to the elderly and disabled.
       Requires the case manager to monitor services delivered to 
     the individual, the quality of care and the individual's 
     status. Requires periodic reassessment of individuals, no 
     less than every 6 months, and revisions to the care plan as 
     needed. Allows for discharge of the case by the case manager, 
     in consultation with the primary physician, when the 
     individual no longer qualifies for benefits under this title.
       Establishes the criteria and requirements for ``qualified 
     case managers'' eligible to provide or arrange for services 
     under this program.
       Requires the State plan to specify the types of providers 
     eligible for participation in the program and any 
     requirements for participation applicable to each type of 
     provider. Also defines a minimum mandatory list of services 
     which must be covered under the State plan. Defines a 
     qualified provider as one licensed under State law and 
     meeting any other criteria established by the Secretary or 
     the State.
       Establishes a list of services which must be excluded under 
     the State's plan, including services already being received 
     by the individual under a provision of the Health Security 
     Act or other insurance plan or program which is not a state 
     program. Also excludes services which would otherwise be 
     provided in a nursing facility or ICF/MR unless the state or 
     case manager reasonably estimates the cost of the covered 
     services would be lower than in the nursing facility or ICF/
     MR.
       Requires the state to ensure that a person already 
     receiving home and commodity-based care at the time this act 
     becomes effective continues to receive an appropriate level 
     of such services.
       Requires the state to develop a system of monitoring and 
     ensuring the quality of home and community-based services 
     which includes minimum standards for care managers and 
     providers; minimum competency standards for provider 
     employees providing direct care; opportunities for consumer 
     participation in evaluating the quality of care; and 
     involvement of the long term care ombudsman and development 
     disabilities agencies in assuring quality of care. Also 
     requires the State to provide safeguards against the 
     physical, emotional, or financial abuse or exploitation of 
     individuals served under the program.
       Requires the state to specify a method of payment to 
     providers and case managers which may include fee-for-service 
     arrangements, prepayment on a capitation basis, or a 
     combination of the two. The state may allow the case manager 
     authority to negotiate rates with providers. The state must 
     expressly specify its rate-setting methodology and ensure 
     that it complies with section 1902(a) (30(A). The state must 
     restrict participation to those providers which agree to 
     accept payment established under the plan for covered 
     services (except to the extent program beneficiaries elect to 
     purchase additional services not covered under the plan).
       Section 602. Amends 42 U.S.C. 1396a(a)(1) by providing that 
     in determining [Medicaid] eligibility for an individual who 
     is an inpatient in a nursing facility or an ICF/MR, the first 
     $12,000 or resources shall be disregarded for unmarried 
     persons.

                       Title VII. Asset Transfers

       Section 701. Amends section 1917(c)(1) of the Social 
     Security Act by extending the ``look-back'' period for asset 
     transfers from 36 months to 60 months.
       Section 702. Modifies current law by requiring that the 
     income and assets of income cap trusts, nonprofit asset 
     trusts, or other trust arrangements must be considered as 
     assets, and are not exempt from existing trust rules section 
     1917 of the Social Security Act unless the trust is 
     irrevocable and all months remaining in the trust upon the 
     beneficiary's death are payable to the state.
       Further provides that any conversion of personal or real 
     property (including cash) into an annuity, including a 
     personal service annuity by a family member, within the 
     previous 60-month period will be deemed an unlawful transfer, 
     even if made for fair market value.
       Furher directs the Secretary to issue regulations 
     prohibiting 1) the use of family limited partnerships to 
     convert assets to an exempt status; 2) purchases of interests 
     in third-party assets for the purpose of rendering assets 
     unavailable; and 3) purchase of care service agreements for 
     past services by family members.
       Section 702. Makes this title effective January 1, 1995.

                          ____________________