[Congressional Record Volume 144, Number 30 (Wednesday, March 18, 1998)]
[Senate]
[Pages S2222-S2228]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                          AMENDMENTS SUBMITTED

                                 ______
                                 

        THE EDUCATION SAVINGS ACT FOR PUBLIC AND PRIVATE SCHOOLS

                                 ______
                                 

                        ROTH AMENDMENT NO. 2019

  Mr. ROTH proposed an amendment to the bill (H.R. 2646) to amend the 
Internal Revenue Code of 1986 to allow tax-free expenditures from 
education individual retirement accounts for elementary and secondary 
school expenses, to increase the maximum annual amount of contributions 
to such accounts, and for other purposes; as follows:

         Strike all after the enacting clause and insert:

     SECTION 1. SHORT TITLE; AMENDMENT TO 1986 CODE; TABLE OF 
                   CONTENTS.

         (a) Short Title.--This Act may be cited as the ``Parent 
     and Student Savings Account PLUS Act''.
         (b) Amendment to 1986 Code.--Except as otherwise 
     expressly provided, whenever in this Act an amendment or 
     repeal is expressed in terms of an amendment to, or repeal 
     of, a section or other provision, the reference shall be 
     considered to be made to a section or other provision of the 
     Internal Revenue Code of 1986.
         (c) Table of Contents.--The table of contents for this 
     Act is as follows:

       Sec. 1. Short title; amendment to 1986 Code; table of 
           contents.

                 TITLE I--TAX INCENTIVES FOR EDUCATION

       Sec. 101. Modifications to education individual retirement 
           accounts.
       Sec. 102. Exclusion from gross income of education 
           distributions from qualified State tuition programs.
       Sec. 103. Extension of exclusion for employer-provided 
           educational assistance.
       Sec. 104. Additional increase in arbitrage rebate exception 
           for governmental bonds used to finance education 
           facilities.
       Sec. 105. Exclusion of certain amounts received under the 
           National Health Corps Scholarship program.
       Sec. 106. Treatment of qualified public educational 
           facility bonds as exempt facility bonds.

                           TITLE II--REVENUE

       Sec. 201. Clarification of deduction for deferred 
           compensation.
       Sec. 202. Modification to foreign tax credit carryback and 
           carryover periods.
                 TITLE I--TAX INCENTIVES FOR EDUCATION

     SEC. 101. MODIFICATIONS TO EDUCATION INDIVIDUAL RETIREMENT 
                   ACCOUNTS.

         (a) Tax-Free Expenditures for Elementary and Secondary 
     School Expenses.--
         (1) In general.--Section 530(b)(2) (defining qualified 
     higher education expenses) is amended to read as follows:
         ``(2) Qualified education expenses.--
         ``(A) In general.--The term `qualified education 
     expenses' means--
         ``(i) qualified higher education expenses (as defined in 
     section 529(e)(3)), and
         ``(ii) qualified elementary and secondary education 
     expenses (as defined in paragraph (4)).
     Such expenses shall be reduced as provided in section 
     25A(g)(2).
         ``(B) Qualified state tuition programs.--Such term shall 
     include amounts paid or incurred to purchase tuition credits 
     or certificates, or to make contributions to an account, 
     under a qualified State tuition program (as defined in 
     section 529(b)) for the benefit of the beneficiary of the 
     account.''
         (2) Qualified elementary and secondary education 
     expenses.--Section 530(b) (relating to definitions and 
     special rules) is amended by adding at the end the following 
     new paragraph:
         ``(4) Qualified elementary and secondary education 
     expenses.--
         ``(A) In general.--The term `qualified elementary and 
     secondary education expenses' means--
         ``(i) expenses for tuition, fees, academic tutoring, 
     special needs services, books, supplies, computer equipment 
     (including related software and services), and other 
     equipment which are incurred in connection with the 
     enrollment or attendance of the designated beneficiary of the 
     trust as an elementary or secondary school student at a 
     public, private, or religious school, or
         ``(ii) expenses for room and board, uniforms, 
     transportation, and supplementary items and services 
     (including extended day programs) which are required or 
     provided by a public, private, or religious school in 
     connection with such enrollment or attendance.
         ``(B) Special rule for homeschooling.--Such term shall 
     include expenses described in subparagraph (A)(i) in 
     connection with education provided by homeschooling if the 
     requirements of any applicable State or local law are met 
     with respect to such education.
         ``(C) School.--The term `school' means any school which 
     provides elementary education or secondary education 
     (kindergarten through grade 12), as determined under State 
     law.''
         (3) Special rules for applying exclusion to elementary 
     and secondary expenses.--Section 530(d)(2) (relating to 
     distributions for qualified higher education expenses) is 
     amended by adding at the end the following new subparagraph:
         ``(D) Special rules for elementary and secondary 
     expenses.--
         ``(i) In general.--The aggregate amount of qualified 
     elementary and secondary education expenses taken into 
     account for purposes of this paragraph with respect to any 
     education individual retirement account for all taxable years 
     shall not exceed the sum of the aggregate contributions to 
     such account for taxable years beginning after December 31, 
     1998, and before January 1, 2003, and earnings on such 
     contributions.
         ``(ii) Special operating rules.--For purposes of clause 
     (i)--

         ``(I) the trustee of an education individual retirement 
     account shall keep separate accounts with respect to 
     contributions and earnings described in clause (i), and
         ``(II) if there are distributions in excess of qualified 
     elementary and secondary education expenses for any taxable 
     year, such excess distributions shall be allocated first to 
     contributions and earnings not described in clause (i).''

         (4) Conforming amendments.--Subsections (b)(1) and (d)(2) 
     of section 530 are each amended by striking ``higher'' each 
     place it appears in the text and heading thereof.
         (b) Maximum Annual Contributions.--
         (1) In general.--Section 530(b)(1)(A)(iii) (defining 
     education individual retirement account) is amended by 
     striking ``$500'' and inserting ``the contribution limit for 
     such taxable year''.
         (2) Contribution limit.--Section 530(b) (relating to 
     definitions and special rules), as amended by subsection 
     (a)(2), is amended by adding at the end the following new 
     paragraph:
         ``(5) Contribution limit.--The term `contribution limit' 
     means $500 ($2,000 in the case of any taxable year beginning 
     after December 31, 1998, and ending before January 1, 
     2003).''
         (3) Conforming amendments.--
         (A) Section 530(d)(4)(C) is amended by striking ``$500'' 
     and inserting ``the contribution limit for such taxable 
     year''.
         (B) Section 4973(e)(1)(A) is amended by striking ``$500'' 
     and inserting ``the contribution limit (as defined in section 
     530(b)(5)) for such taxable year''.
         (c) Waiver of Age Limitations for Children With Special 
     Needs.--Section 530(b)(1) (defining education individual 
     retirement account) is amended by adding at the end the 
     following flush sentence:

     ``The age limitations in the preceding sentence shall not 
     apply to any designated beneficiary with special needs (as 
     determined under regulations prescribed by the Secretary).''
         (d) Corporations Permitted To Contribute to Accounts.--
     Section 530(c)(1) (relating to reduction in permitted 
     contributions based on adjusted gross income) is amended by 
     striking ``The maximum amount which a contributor'' and 
     inserting ``In the case of a contributor who is an 
     individual, the maximum amount the contributor''.
         (e) No Double Benefit.--Section 530(d)(2) (relating to 
     distributions for qualified education expenses), as amended 
     by subsection (a)(3), is amended by adding at the end the 
     following new subparagraph:
         ``(E) Disallowance of excluded amounts as credit or 
     deduction.--No deduction or credit shall be allowed to the 
     taxpayer under any other section of this chapter

[[Page S2223]]

     for any qualified education expenses to the extent taken into 
     account in determining the amount of the exclusion under this 
     paragraph.''
         (f) Technical Corrections.--
         (1)(A) Section 530(b)(1)(E) (defining education 
     individual retirement account) is amended to read as follows:
         ``(E) Any balance to the credit of the designated 
     beneficiary on the date on which the beneficiary attains age 
     30 shall be distributed within 30 days after such date to the 
     beneficiary or, if the beneficiary dies before attaining age 
     30, shall be distributed within 30 days after the date of 
     death to the estate of such beneficiary.''
         (B) Section 530(d) (relating to tax treatment of 
     distributions) is amended by adding at the end the following 
     new paragraph:
         ``(8) Deemed distribution on required distribution 
     date.--In any case in which a distribution is required under 
     subsection (b)(1)(E), any balance to the credit of a 
     designated beneficiary as of the close of the 30-day period 
     referred to in such subsection for making such distribution 
     shall be deemed distributed at the close of such period.''
         (2)(A) Section 530(d)(1) is amended by striking ``section 
     72(b)'' and inserting ``section 72''.
         (B) Section 72(e) (relating to amounts not received as 
     annuities) is amended by inserting after paragraph (8) the 
     following new paragraph:
         ``(9) Extension of paragraph (2)(b) to qualified state 
     tuition programs and educational individual retirement 
     accounts.--Notwithstanding any other provision of this 
     subsection, paragraph (2)(B) shall apply to amounts received 
     under a qualified State tuition program (as defined in 
     section 529(b)) or under an education individual retirement 
     account (as defined in section 530(b)). The rule of paragraph 
     (8)(B) shall apply for purposes of this paragraph.''
         (3) Section 530(d)(4)(B) (relating to exceptions) is 
     amended by striking ``or'' at the end of clause (ii), by 
     striking the period at the end of clause (iii) and inserting 
     ``, or'', and by adding at the end the following new clause:
         ``(iv) an amount which is includible in gross income 
     solely because the taxpayer elected under paragraph (2)(C) to 
     waive the application of paragraph (2) for the taxable 
     year.''
         (g) Effective Dates.--
         (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to taxable years 
     beginning after December 31, 1998.
         (2) Technical corrections.--The amendments made by 
     subsection (f) shall take effect as if included in the 
     amendments made by section 213 of the Taxpayer Relief Act of 
     1997.

     SEC. 102. EXCLUSION FROM GROSS INCOME OF EDUCATION 
                   DISTRIBUTIONS FROM QUALIFIED STATE TUITION 
                   PROGRAMS.

         (a) In General.--Section 529(c)(3)(B) (relating to 
     distributions) is amended to read as follows:
         ``(B) Distributions for qualified higher education 
     expenses.--
         ``(i) In general.--No amount shall be includible in gross 
     income under subparagraph (A) if the qualified higher 
     education expenses of the designated beneficiary during the 
     taxable year are not less than the aggregate distributions 
     during the taxable year.
         ``(ii) Distributions in excess of expenses.--If such 
     aggregate distributions exceed such expenses during the 
     taxable year, the amount otherwise includible in gross income 
     under subparagraph (A) shall be reduced by the amount which 
     bears the same ratio to the amount so includible (without 
     regard to this subparagraph) as such expenses bear to such 
     aggregate distributions.
         ``(iii) Election to waive exclusion.--A taxpayer may 
     elect to waive the application of this subparagraph for any 
     taxable year.
         ``(iv) In-kind distributions.--Any benefit furnished to a 
     designated beneficiary under a qualified State tuition 
     program shall be treated as a distribution to the beneficiary 
     for purposes of this paragraph.
         ``(v) Disallowance of excluded amounts as credit or 
     deduction.--No deduction or credit shall be allowed to the 
     taxpayer under any other section of this chapter for any 
     qualified higher education expenses to the extent taken into 
     account in determining the amount of the exclusion under this 
     paragraph.''
         (b) Definition of Qualified Higher Education Expenses.--
     Section 529(e)(3)(A) (defining qualified higher education 
     expenses) is amended to read as follows:
         ``(A) In general.--The term `qualified higher education 
     expenses' means expenses for tuition, fees, academic 
     tutoring, special needs services, books, supplies, computer 
     equipment (including related software and services), and 
     other equipment which are incurred in connection with the 
     enrollment or attendance of the designated beneficiary at an 
     eligible educational institution.''
         (c) Coordination With Education Credits.--Section 
     25A(e)(2) (relating to coordination with exclusions) is 
     amended--
         (1) by inserting ``a qualified State tuition program or'' 
     before ``an education individual retirement account'', and
         (2) by striking ``section 530(d)(2)'' and inserting 
     ``section 529(c)(3)(B) or 530(d)(2)''.
         (d) Technical Correction.--Section 529(c)(3)(A) is 
     amended by striking ``section 72(b)'' and inserting ``section 
     72''.
         (e) Effective Dates.--
         (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to taxable years 
     beginning after December 31, 1998.
         (2) Technical correction.--The amendment made by 
     subsection (d) shall take effect as if included in the 
     amendments made by section 211 of the Taxpayer Relief Act of 
     1997.

     SEC. 103. EXTENSION OF EXCLUSION FOR EMPLOYER-PROVIDED 
                   EDUCATIONAL ASSISTANCE.

         (a) In General.--Section 127(d) (relating to termination 
     of exclusion for educational assistance programs) is amended 
     by striking ``May 31, 2000'' and inserting ``December 31, 
     2002''.
         (b) Repeal of Limitation on Graduate Education.--The last 
     sentence of section 127(c)(1) (defining educational 
     assistance) is amended by striking ``, and such term also 
     does not include any payment for, or the provision of any 
     benefits with respect to, any graduate level course of a kind 
     normally taken by an individual pursuing a program leading to 
     a law, business, medical, or other advanced academic or 
     professional degree''.
         (c) Effective Dates.--
         (1) Extension.--The amendment made by subsection (a) 
     shall apply to expenses paid with respect to courses 
     beginning after May 31, 2000.
         (2) Graduate education.--The amendment made by subsection 
     (b) shall apply to expenses paid with respect to courses 
     beginning after December 31, 1997.

     SEC. 104. ADDITIONAL INCREASE IN ARBITRAGE REBATE EXCEPTION 
                   FOR GOVERNMENTAL BONDS USED TO FINANCE 
                   EDUCATION FACILITIES.

         (a) In General.--Section 148(f)(4)(D)(vii) (relating to 
     increase in exception for bonds financing public school 
     capital expenditures) is amended by striking ``$5,000,000'' 
     the second place it appears and inserting ``$10,000,000''.
         (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to obligations issued after December 31, 1998.

     SEC. 105. EXCLUSION OF CERTAIN AMOUNTS RECEIVED UNDER THE 
                   NATIONAL HEALTH CORPS SCHOLARSHIP PROGRAM.

         (a) In General.--Section 117(c) (relating to the 
     exclusion from gross income amounts received as a qualified 
     scholarship) is amended--
         (1) by striking ``Subsections (a)'' and inserting the 
     following:
         ``(1) In general.--Except as provided in paragraph (2), 
     subsections (a)''; and
         (2) by adding at the end the following new paragraph:
         ``(2) National health corps scholarship program.--
     Paragraph (1) shall not apply to any amount received by an 
     individual under the National Health Corps Scholarship 
     Program under section 338A(g)(1)(A) of the Public Health 
     Service Act.''
         (b) Effective Date.--The amendments made by subsection 
     (a) shall apply to amounts received in taxable years 
     beginning after December 31, 1993.

     SEC. 106. TREATMENT OF QUALIFIED PUBLIC EDUCATIONAL FACILITY 
                   BONDS AS EXEMPT FACILITY BONDS.

         (a) Treatment as Exempt Facility Bond.--Subsection (a) of 
     section 142 (relating to exempt facility bond) is amended by 
     striking ``or'' at the end of paragraph (11), by striking the 
     period at the end of paragraph (12) and inserting ``, or'', 
     and by adding at the end the following:
         ``(13) qualified public educational facilities.''
         (b) Qualified Public Educational Facilities.--Section 142 
     is amended by adding at the end the following:
         ``(k) Qualified Public Educational Facilities.--
         ``(1) In general.--For purposes of subsection (a)(13), 
     the term `qualified public educational facility' means any 
     school facility which is--
         ``(A) part of a public elementary school or a public 
     secondary school,
         ``(B) except as provided in paragraph (6)(B)(iii), 
     located in a high-growth school district, and
         ``(C) owned by a private, for-profit corporation pursuant 
     to a public-private partnership agreement with a State or 
     local educational agency described in paragraph (2).
         ``(2) Public-private partnership agreement described.--A 
     public-private partnership agreement is described in this 
     paragraph if it is an agreement--
         ``(A) under which the corporation agrees--
         ``(i) to do 1 or more of the following: construct, 
     rehabilitate, refurbish, or equip a school facility, and
         ``(ii) at the end of the contract term, to transfer the 
     school facility to such agency for no additional 
     consideration, and
         ``(B) the term of which does not exceed the term of the 
     underlying issue.
         ``(3) School facility.--For purposes of this subsection, 
     the term `school facility' means--
         ``(A) school buildings,
         ``(B) functionally related and subordinate facilities and 
     land with respect to such buildings, including any stadium or 
     other facility primarily used for school events, and
         ``(C) any property, to which section 168 applies (or 
     would apply but for section 179), for use in the facility.
         ``(4) Public schools.--For purposes of this subsection, 
     the terms `elementary school' and `secondary school' have the 
     meanings given such terms by section 14101 of the Elementary 
     and Secondary Education Act of 1965 (20 U.S.C. 8801), as in 
     effect on the date of the enactment of this subsection.

[[Page S2224]]

         ``(5) High-growth school district.--For purposes of this 
     subsection, the term `high-growth school district' means a 
     school district established under State law which had an 
     enrollment of at least 5,000 students in the second academic 
     year preceding the date of the issuance of the bond and an 
     increase in student enrollment of at least 20 percent during 
     the 5-year period ending with such academic year.
         ``(6) Annual aggregate face amount of tax-exempt 
     financing.--
         ``(A) In general.--An issue shall not be treated as an 
     issue described in subsection (a)(13) if the aggregate face 
     amount of bonds issued by the State pursuant thereto (when 
     added to the aggregate face amount of bonds previously so 
     issued during the calendar year) exceeds an amount equal to 
     the greater of--
         ``(i) $10 multiplied by the State population, or
         ``(ii) $5,000,000.
         ``(B) Allocation rules.--
         ``(i) In general.--Except as otherwise provided in this 
     subparagraph, the State may allocate in a calendar year the 
     amount described in subparagraph (A) for such year in such 
     manner as the State determines appropriate.
         ``(ii) Rules for carryforward of unused amount.--With 
     respect to any calendar year, a State may make an election 
     under rules similar to the rules of section 146(f), except 
     that the sole carryforward purpose with respect to such 
     election is the issuance of exempt facility bonds described 
     in section 142(a)(13).
         ``(iii) Special allocation rule for schools outside high-
     growth school districts.--A State may elect to allocate an 
     aggregate face amount of bonds not to exceed $5,000,000 from 
     the amount described in subparagraph (A) for each calendar 
     year for qualified public educational facilities without 
     regard to the requirement under paragraph (1)(A).''
         (c) Exemption From General State Volume Caps.--Paragraph 
     (3) of section 146(g) (relating to exception for certain 
     bonds) is amended--
         (1) by striking ``or (12)'' and inserting ``(12), or 
     (13)'', and
         (2) by striking ``and environmental enhancements of 
     hydroelectric generating facilities'' and inserting 
     ``environmental enhancements of hydroelectric generating 
     facilities, and qualified public educational facilities''.
         (d) Exemption From Limitation on Use for Land 
     Acquisition.--Section 147(h) (relating to certain rules not 
     apply) is amended--
         (1) by adding at the end the following:
         ``(3) Exempt facility bonds for qualified public 
     educational facilities.--Subsection (c) shall not apply to 
     any exempt facility bond issued as part of an issue described 
     in section 142(a)(13) (relating to qualified public 
     educational facilities).'', and
         (2) by striking ``Mortgage Revenue Bonds, Qualified 
     Student Loan Bonds, and Qualified 501(c)(3) Bonds'' in the 
     heading and inserting ``Certain Bonds''.
         (e) Effective Date.--The amendments made by this section 
     shall apply to bonds issued after December 31, 1998.
                           TITLE II--REVENUE

     SEC. 201. CLARIFICATION OF DEDUCTION FOR DEFERRED 
                   COMPENSATION.

         (a) In General.--Section 404(a) (relating to deduction 
     for contributions of an employer to an employee's trust or 
     annuity plan and compensation under a deferred-payment plan) 
     is amended by adding at the end the following new paragraph:
         ``(11) Determinations relating to deferred 
     compensation.--
         ``(A) In general.--For purposes of determining under this 
     section--
         ``(i) whether compensation of an employee is deferred 
     compensation, and
         ``(ii) when deferred compensation is paid,

     no amount shall be treated as received by the employee, or 
     paid, until it is actually received by the employee.
         ``(B) Exception.--Subparagraph (A) shall not apply to 
     severance pay.''
         (b) Effective Date.--
         (1) In general.--The amendment made by subsection (a) 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.
         (2) Change in method of accounting.--In the case of any 
     taxpayer required by the amendment made by subsection (a) to 
     change its method of accounting for its first taxable year 
     ending after the date of the enactment of this Act--
         (A) such change shall be treated as initiated by the 
     taxpayer,
         (B) such change shall be treated as made with the consent 
     of the Secretary of the Treasury, and
         (C) the net amount of the adjustments required to be 
     taken into account by the taxpayer under section 481 of the 
     Internal Revenue Code of 1986 shall be taken into account in 
     such first taxable year.

     SEC. 202. MODIFICATION TO FOREIGN TAX CREDIT CARRYBACK AND 
                   CARRYOVER PERIODS.

         (a) In General.--Section 904(c) (relating to limitation 
     on credit) is amended--
         (1) by striking ``in the second preceding taxable 
     year,'', and
         (2) by striking ``or fifth'' and inserting ``fifth, 
     sixth, or seventh''.
         (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to credits arising in taxable years beginning 
     after December 31, 2000.
                                 ______
                                 

                       MURRAY AMENDMENT NO. 2020

  (Ordered to lie on the table.)
  Mrs. MURRAY submitted an amendment intended to be proposed by her to 
the bill, H.R. 2646, supra; as follows:

       At the end, add the following:
                     TITLE ____--SENSE OF CONGRESS

     SEC. ____01. SENSE OF CONGRESS.

       Congress makes the following findings:
       (1) Qualified teachers in small classes can provide 
     students with more individualized attention, spend more time 
     on instruction and less on other tasks, cover more material 
     effectively, and are better able to work with parents to help 
     the parents further their children's education.
       (2) Rigorous research has shown that students attending 
     small classes in the early grades make more rapid educational 
     progress than the students in larger classes, and that those 
     achievement gains persist through at least the 8th grade. For 
     example:
       (A) In a landmark 4-year experimental study of class size 
     reduction in grades kindergarten through grade 3 in 
     Tennessee, researchers found that students in smaller classes 
     earned significantly higher scores on basic skills tests in 
     all 4 years and in all types of schools, including urban, 
     rural, and suburban schools.
       (B) After 2 years in reduced class sizes, students in the 
     Flint, Michigan Public School District improved their reading 
     scores by 44 percent.
       (3) The benefits of smaller classes are greatest for lower-
     achieving, minority, poor, and inner-city children. One study 
     found that urban 4th-graders in smaller than average classes 
     were \3/4\ of a school year ahead of their counterparts in 
     larger than average classes.
       (4) Smaller classes allow teachers to identify and work 
     sooner with students who have learning disabilities and, 
     potentially, can reduce those students' need for special 
     education services in the later grades.
       (5) Students in smaller classes are able to become more 
     actively engaged in learning than their peers in large 
     classes.
       (6) Efforts to improve educational outcomes by reducing 
     class sizes in the early grades are likely to be successful 
     only if well-qualified teachers are hired to fill additional 
     classroom positions and if teachers received intensive, 
     continuing training in working effectively in smaller 
     classroom settings.
       (7) State certified and licensed teachers help ensure high 
     quality instruction in the classroom.
       (8) According to the National Commission on Teaching and 
     America's Future, the most important influence on student 
     achievement is the expertise of their teachers. One New York 
     City study comparing high- and low-achieving elementary 
     schools with similar student characteristics, found that more 
     than 90 percent of the variation in achievement in 
     mathematics and reading was due to differences in teacher 
     qualifications.
       (9) Our Nation needs more qualified teachers to meet 
     changing demographics and to help students meet high 
     standards, as demonstrated by the following:
       (A) Over the next decade, our Nation will need to hire over 
     2,000,000 teachers to meet increasing student enrollments and 
     teacher retirements.
       (B) 1 out of 4 high school teachers does not have a major 
     or minor in the main subject that they teach. This is true 
     for more than 30 percent of mathematics teachers.
       (C) In schools with the highest minority enrollments, 
     students have less than a 50 percent chance of getting a 
     science or mathematics teacher who holds a degree in that 
     field.
       (D) In 1991, 25 percent of new public school teachers had 
     not completed the requirements for a license in their main 
     assignment field. This number increased to 27 percent by 
     1994, including 11 percent who did not have a license.
       (10) We need more teachers who are adequately prepared for 
     the challenges of the 21st century classroom, as demonstrated 
     by the fact that--
       (A) 50 percent of teachers have little or no experience 
     using technology in the classroom; and
       (B) in 1994, only 10 percent of new teachers felt they were 
     prepared to integrate new technology into their instruction.
       (11) Teacher quality cannot be further compromised to meet 
     the demographic demand for new teachers and smaller class 
     sizes. Comprehensive improvements in teacher preparation and 
     development programs are also necessary to ensure the 
     effectiveness of new teachers and the academic success of 
     students in the classroom. These comprehensive improvements 
     should include encouraging more institutions of higher 
     education that operate teacher preparation programs to work 
     in partnership with local educational agencies and elementary 
     and secondary schools; providing more hands-on, classroom 
     experience to prospective teachers; creating mentorship 
     programs for new teachers; providing high quality content 
     area training and classroom skills for new teachers; and 
     training teachers to incorporate technology into the 
     classroom.
       (12) Efforts should be made to provide prospective teachers 
     with a greater knowledge of instructional programs that are 
     research-based, of demonstrated effectiveness,

[[Page S2225]]

     replicable in diverse and challenging circumstances, and 
     supported by networks of experts and experienced 
     practitioners.
       (13) Several States have begun serious efforts to reduce 
     class sizes in the early elementary grades, but these actions 
     may be impeded by financial limitations or difficulties in 
     hiring qualified teachers.
       (14) The Federal Government can assist in this effort by 
     providing funding for class size reductions in grades 1 
     through 3, and by helping to ensure that the new teachers 
     brought into the classroom are well-qualified.

     SEC. ____02. SENSE OF CONGRESS.

       It is the sense of Congress that Congress should support 
     efforts to hire 100,000 new teachers to reduce class sizes in 
     first, second, and third grades to an average of 18 students 
     per class all across America.
                                 ______
                                 

                      HUTCHISON AMENDMENT NO. 2021

  (Ordered to lie on the table.)
  Mrs. HUTCHISON submitted an amendment intended to be proposed by her 
to the bill, H.R. 2646, supra; as follows:
       At the end, add the following:
               TITLE ____--EQUAL EDUCATIONAL OPPORTUNITY

     SEC. ____01. EQUAL EDUCATIONAL OPPORTUNITY.

       (a) Short Title.--This section may be cited as the ``Equal 
     Educational Opportunity Act''.
       (b) Amendments to ESEA.--Subsection (b) of section 6301 of 
     the Elementary and Secondary Education Act of 1965 (20 U.S.C. 
     7351) is amended--
       (1) in paragraph (7), by striking ``and'' after the 
     semicolon;
       (2) in paragraph (8), by striking the period and inserting 
     ``; and''; and
       (3) by adding at the end the following:
       ``(9) education reform projects that provide same gender 
     schools and classrooms, as long as comparable educational 
     opportunities are offered for students of both sexes.''.
                                 ______
                                 

                       McCAIN AMENDMENT NO. 2022

  (Ordered to lie on the table.)
  Mr. McCAIN submitted an amendment intended to be proposed by him to 
the bill, H.R. 2646, supra; as follows:

       At the appropriate place, insert the following:

     SEC. ____. MULTILINGUALISM STUDY.

       (a) Findings.--Congress finds that even though all 
     residents of the United States should be proficient in 
     English, without regard to their country of birth, it is also 
     of vital importance to the competitiveness of the United 
     States that those residents be encouraged to learn other 
     languages.
       (b) Resident of the United States Defined.--In this 
     section, the term ``resident of the United States'' means an 
     individual who resides in the United States, other than an 
     alien who is not lawfully present in the United States.
       (c) Study.--
       (1) In general.--Not later than 180 days after the date of 
     enactment of this Act, the Comptroller General of the United 
     States (referred to in this section as the ``Comptroller 
     General'') shall conduct a study of multilingualism in the 
     United States in accordance with this section.
       (2) Requirements.--
       (A) In general.--The study conducted under this section 
     shall ascertain--
       (i) the percentage of residents in the United States who 
     are proficient in English and at least 1 other language;
       (ii) the predominant language other than English in which 
     residents referred to in clause (i) are proficient;
       (iii) the percentage of the residents described in clause 
     (i) who were born in a foreign country;
       (iv) the percentage of the residents described in clause 
     (i) who were born in the United States;
       (v) the percentage of the residents described in clause 
     (iv) who are second-generation residents of the United 
     States; and
       (vi) the percentage of the residents described in clause 
     (iv) who are third-generation residents of the United States.
       (B) Age-specific categories.--The study under this section 
     shall, with respect to the residents described in 
     subparagraph (A)(i), determine the number of those residents 
     in each of the following categories:
       (i) Residents who have not attained the age of 12.
       (ii) Residents have attained the age of 12, but have not 
     attained the age of 18.
       (iii) Residents who have attained the age of 18, but have 
     not attained the age of 50.
       (iv) Residents who have attained the age of 50.
       (C) Federal programs.--In conducting the study under this 
     section, the Comptroller General shall establish a list of 
     each Federal program that encourages multilingualism with 
     respect to any category of residents described in 
     subparagraph (B).
       (D) Comparisons.--In conducting the study under this 
     section, the Comptroller General shall compare the 
     multilingual population described in subparagraph (A) with 
     the multilingual populations of foreign countries--
       (i) in the Western hemisphere; and
       (ii) in Asia.
       (d) Report.--Upon completion of the study under this 
     section, the Comptroller General shall prepare, and submit to 
     Congress, a report that contains the results of the study 
     conducted under this section, and such findings and 
     recommendations as the Comptroller General determines to be 
     appropriate.
                                 ______
                                 

                D'AMATO (AND OTHERS) AMENDMENT NO. 2023

  (Ordered to lie on the table.)
  Mr. D'AMATO (for himself, Mr. DASCHLE, Ms. SNOWE, and Mrs. FEINSTEIN) 
submitted an amendment intended to be proposed by them to the bill. 
H.R. 2646, supra; as follows:

       At the appropriate place, insert the following:
                 TITLE ____--WOMEN'S HEALTH AND CANCER

     SEC. ____01. SHORT TITLE.

       This Act may be cited as the ``Women's Health and Cancer 
     Rights Act of 1998''.

     SEC. ____02. FINDINGS.

       Congress finds that--
       (1) the offering and operation of health plans affect 
     commerce among the States;
       (2) health care providers located in a State serve patients 
     who reside in the State and patients who reside in other 
     States; and
       (3) in order to provide for uniform treatment of health 
     care providers and patients among the States, it is necessary 
     to cover health plans operating in 1 State as well as health 
     plans operating among the several States.

     SEC. ____03. AMENDMENTS TO THE EMPLOYEE RETIREMENT INCOME 
                   SECURITY ACT OF 1974.

       (a) In General.--Subpart B of part 7 of subtitle B of title 
     I of the Employee Retirement Income Security Act of 1974 (as 
     added by section 603(a) of the Newborns' and Mothers' Health 
     Protection Act of 1996 and amended by section 702(a) of the 
     Mental Health Parity Act of 1996) is amended by adding at the 
     end the following new section:

     ``SEC. 713. REQUIRED COVERAGE FOR MINIMUM HOSPITAL STAY FOR 
                   MASTECTOMIES AND LYMPH NODE DISSECTIONS FOR THE 
                   TREATMENT OF BREAST CANCER AND COVERAGE FOR 
                   RECONSTRUCTIVE SURGERY FOLLOWING MASTECTOMIES.

       ``(a) Inpatient Care.--
       ``(1) In general.--A group health plan, and a health 
     insurance issuer providing health insurance coverage in 
     connection with a group health plan, that provides medical 
     and surgical benefits shall ensure that inpatient coverage 
     with respect to the treatment of breast cancer is provided 
     for a period of time as is determined by the attending 
     physician, in his or her professional judgment consistent 
     with generally accepted medical standards, in consultation 
     with the patient, to be medically appropriate following--
       ``(A) a mastectomy;
       ``(B) a lumpectomy; or
       ``(C) a lymph node dissection for the treatment of breast 
     cancer.
       ``(2) Exception.--Nothing in this section shall be 
     construed as requiring the provision of inpatient coverage if 
     the attending physician and patient determine that a shorter 
     period of hospital stay is medically appropriate.
       ``(b) Reconstructive Surgery.--A group health plan, and a 
     health insurance issuer providing health insurance coverage 
     in connection with a group health plan, that provides medical 
     and surgical benefits with respect to a mastectomy shall 
     ensure that, in a case in which a mastectomy patient elects 
     breast reconstruction, coverage is provided for--
       ``(1) all stages of reconstruction of the breast on which 
     the mastectomy has been performed;
       ``(2) surgery and reconstruction of the other breast to 
     produce a symmetrical appearance; and
       ``(3) the costs of prostheses and complications of 
     mastectomy including lymphodemas;
     in the manner determined by the attending physician and the 
     patient to be appropriate. Such coverage may be subject to 
     annual deductibles and coinsurance provisions as may be 
     deemed appropriate and as are consistent with those 
     established for other benefits under the plan or coverage. 
     Written notice of the availability of such coverage shall be 
     delivered to the participant upon enrollment and annually 
     thereafter.
       ``(c) Notice.--A group health plan, and a health insurance 
     issuer providing health insurance coverage in connection with 
     a group health plan shall provide notice to each participant 
     and beneficiary under such plan regarding the coverage 
     required by this section in accordance with regulations 
     promulgated by the Secretary. Such notice shall be in writing 
     and prominently positioned in any literature or 
     correspondence made available or distributed by the plan or 
     issuer and shall be transmitted--
       ``(1) in the next mailing made by the plan or issuer to the 
     participant or beneficiary;
       ``(2) as part of any yearly informational packet sent to 
     the participant or beneficiary; or
       ``(3) not later than January 1, 1998;
     whichever is earlier.
       ``(d) No Authorization Required.--
       ``(1) In general.--An attending physician shall not be 
     required to obtain authorization from the plan or issuer for 
     prescribing any length of stay in connection with a 
     mastectomy, a lumpectomy, or a lymph node dissection for the 
     treatment of breast cancer.
       ``(2) Prenotification.--Nothing in this section shall be 
     construed as preventing a group

[[Page S2226]]

     health plan from requiring prenotification of an inpatient 
     stay referred to in this section if such requirement is 
     consistent with terms and conditions applicable to other 
     inpatient benefits under the plan, except that the provision 
     of such inpatient stay benefits shall not be contingent upon 
     such notification.
       ``(e) Prohibitions.--A group health plan, and a health 
     insurance issuer offering group health insurance coverage in 
     connection with a group health plan, may not--
       ``(1) deny to a woman eligibility, or continued 
     eligibility, to enroll or to renew coverage under the terms 
     of the plan, solely for the purpose of avoiding the 
     requirements of this section;
       ``(2) provide monetary payments or rebates to individuals 
     to encourage such individuals to accept less than the minimum 
     protections available under this section;
       ``(3) penalize or otherwise reduce or limit the 
     reimbursement of an attending provider because such provider 
     provided care to an individual participant or beneficiary in 
     accordance with this section;
       ``(4) provide incentives (monetary or otherwise) to an 
     attending provider to induce such provider to provide care to 
     an individual participant or beneficiary in a manner 
     inconsistent with this section; and
       ``(5) subject to subsection (f)(3), restrict benefits for 
     any portion of a period within a hospital length of stay 
     required under subsection (a) in a manner which is less 
     favorable than the benefits provided for any preceding 
     portion of such stay.
       ``(f) Rules of Construction.--
       ``(1) In general.--Nothing in this section shall be 
     construed to require a woman who is a participant or 
     beneficiary--
       ``(A) to undergo a mastectomy or lymph node dissection in a 
     hospital; or
       ``(B) to stay in the hospital for a fixed period of time 
     following a mastectomy or lymph node dissection.
       ``(2) Limitation.--This section shall not apply with 
     respect to any group health plan, or any group health 
     insurance coverage offered by a health insurance issuer, 
     which does not provide benefits for hospital lengths of stay 
     in connection with a mastectomy or lymph node dissection for 
     the treatment of breast cancer.
       ``(3) Cost sharing.--Nothing in this section shall be 
     construed as preventing a group health plan or issuer from 
     imposing deductibles, coinsurance, or other cost-sharing in 
     relation to benefits for hospital lengths of stay in 
     connection with a mastectomy or lymph node dissection for the 
     treatment of breast cancer under the plan (or under health 
     insurance coverage offered in connection with a group health 
     plan), except that such coinsurance or other cost-sharing for 
     any portion of a period within a hospital length of stay 
     required under subsection (a) may not be greater than such 
     coinsurance or cost-sharing for any preceding portion of such 
     stay.
       ``(4) Level and type of reimbursements.--Nothing in this 
     section shall be construed to prevent a group health plan or 
     a health insurance issuer offering group health insurance 
     coverage from negotiating the level and type of reimbursement 
     with a provider for care provided in accordance with this 
     section.
       ``(g) Safe Harbors.--The provisions of this section shall 
     not be applicable to any group health plan for any plan year 
     for which such plan has voluntarily sought and received 
     certification from the National Cancer Institute, or any 
     similar entity authorized by the Secretary, that such plan 
     provides appropriate coverage, consistent with the objectives 
     of this section, for mastectomies, lumpectomies and lymph 
     node dissection for the treatment of breast cancer.
       ``(h) Preemption, Relation to State Laws.--
       ``(1) In general.--Nothing in this section may be construed 
     to prohibit a State from establishing, implementing or 
     continuing in effect any standard or requirement not 
     prohibited by this section unless such standard or 
     requirement is inconsistent with, in conflict with, or 
     prevents the application of a standard or requirement of this 
     section. With respect to a standard or requirement that is 
     directly or indirectly prohibited by this section, a State 
     may not establish, implement or continue in effect any 
     requirement or standard that is different from or in addition 
     to, or that is not otherwise identical with, or does not 
     provide patient protections similar to, the standards or 
     requirements established under this section.
       ``(2) Preemption.--Nothing in this section shall be 
     construed to affect or modify the provisions of section 514 
     with respect to group health plans.''.
       (b) Clerical Amendment.--The table of contents in section 1 
     of the Employee Retirement Income Security Act of 1974, as 
     amended by section 603 of the Newborns' and Mothers' Health 
     Protection Act of 1996 and section 702 of the Mental Health 
     Parity Act of 1996, is amended by inserting after the item 
     relating to section 712 the following new item:

``Sec. 713. Required coverage for minimum hospital stay for 
              mastectomies and lymph node dissections for the treatment 
              of breast cancer and coverage for reconstructive surgery 
              following mastectomies.''.

       (c) Effective Dates.--
       (1) In general.--The amendments made by this section shall 
     apply with respect to plan years beginning on or after the 
     date of enactment of this Act.
       (2) Special rule for collective bargaining agreements.--In 
     the case of a group health plan maintained pursuant to 1 or 
     more collective bargaining agreements between employee 
     representatives and 1 or more employers ratified before the 
     date of enactment of this Act, the amendments made by this 
     section shall not apply to plan years beginning before the 
     later of--
       (A) the date on which the last collective bargaining 
     agreements relating to the plan terminates (determined 
     without regard to any extension thereof agreed to after the 
     date of enactment of this Act), or
       (B) January 1, 1999.
     For purposes of subparagraph (A), any plan amendment made 
     pursuant to a collective bargaining agreement relating to the 
     plan which amends the plan solely to conform to any 
     requirement added by this section shall not be treated as a 
     termination of such collective bargaining agreement.

     SEC. ____04. AMENDMENTS TO THE PUBLIC HEALTH SERVICE ACT 
                   RELATING TO THE GROUP MARKET.

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

     ``SEC. 2706. REQUIRED COVERAGE FOR MINIMUM HOSPITAL STAY FOR 
                   MASTECTOMIES AND LYMPH NODE DISSECTIONS FOR THE 
                   TREATMENT OF BREAST CANCER AND COVERAGE FOR 
                   RECONSTRUCTIVE SURGERY FOLLOWING MASTECTOMIES.

       ``(a) Inpatient Care.--
       ``(1) In general.--A group health plan, and a health 
     insurance issuer providing health insurance coverage in 
     connection with a group health plan, that provides medical 
     and surgical benefits shall ensure that inpatient coverage 
     with respect to the treatment of breast cancer is provided 
     for a period of time as is determined by the attending 
     physician, in his or her professional judgment consistent 
     with generally accepted medical standards,in consultation 
     with the patient, to be medically appropriate following--
       ``(A) a mastectomy;
       ``(B) a lumpectomy; or
       ``(C) a lymph node dissection for the treatment of breast 
     cancer.
       ``(2) Exception.--Nothing in this section shall be 
     construed as requiring the provision of inpatient coverage if 
     the attending physician and patient determine that a shorter 
     period of hospital stay is medically appropriate.
       ``(b) Reconstructive Surgery.--A group health plan, and a 
     health insurance issuer providing health insurance coverage 
     in connection with a group health plan, that provides medical 
     and surgical benefits with respect to a mastectomy shall 
     ensure that, in a case in which a mastectomy patient elects 
     breast reconstruction, coverage is provided for--
       ``(1) all stages of reconstruction of the breast on which 
     the mastectomy has been performed;
       ``(2) surgery and reconstruction of the other breast to 
     produce a symmetrical appearance; and
       ``(3) the costs of prostheses and complications of 
     mastectomy including lymphodemas;
     in the manner determined by the attending physician and the 
     patient to be appropriate. Such coverage may be subject to 
     annual deductibles and coinsurance provisions as may be 
     deemed appropriate and as are consistent with those 
     established for other benefits under the plan or coverage. 
     Written notice of the availability of such coverage shall be 
     delivered to the enrollee upon enrollment and annually 
     thereafter.
       ``(c) Notice.--A group health plan, and a health insurance 
     issuer providing health insurance coverage in connection with 
     a group health plan shall provide notice to each participant 
     and beneficiary under such plan regarding the coverage 
     required by this section in accordance with regulations 
     promulgated by the Secretary. Such notice shall be in writing 
     and prominently positioned in any literature or 
     correspondence made available or distributed by the plan or 
     issuer and shall be transmitted--
       ``(1) in the next mailing made by the plan or issuer to the 
     participant or beneficiary;
       ``(2) as part of any yearly informational packet sent to 
     the participant or beneficiary; or
       ``(3) not later than January 1, 1998;
     whichever is earlier.
       ``(d) No Authorization Required.--
       ``(1) In general.--An attending physician shall not be 
     required to obtain authorization from the plan or issuer for 
     prescribing any length of stay in connection with a 
     mastectomy, a lumpectomy, or a lymph node dissection for the 
     treatment of breast cancer.
       ``(2) Prenotification.--Nothing in this section shall be 
     construed as preventing a plan or issuer from requiring 
     prenotification of an inpatient stay referred to in this 
     section if such requirement is consistent with terms and 
     conditions applicable to other inpatient benefits under the 
     plan, except that the provision of such inpatient stay 
     benefits shall not be contingent upon such notification.
       ``(e) Prohibitions.--A group health plan, and a health 
     insurance issuer offering group health insurance coverage in 
     connection with a group health plan, may not--
       ``(1) deny to a woman eligibility, or continued 
     eligibility, to enroll or to renew coverage under the terms 
     of the plan, solely for

[[Page S2227]]

     the purpose of avoiding the requirements of this section;
       ``(2) provide monetary payments or rebates to individuals 
     to encourage such individuals to accept less than the minimum 
     protections available under this section;
       ``(3) penalize or otherwise reduce or limit the 
     reimbursement of an attending provider because such provider 
     provided care to an individual participant or beneficiary in 
     accordance with this section;
       ``(4) provide incentives (monetary or otherwise) to an 
     attending provider to induce such provider to provide care to 
     an individual participant or beneficiary in a manner 
     inconsistent with this section;
       ``(5) provide financial or other incentives to a physician 
     or specialist to induce the physician or specialist to 
     refrain from referring a participant or beneficiary for a 
     secondary consultation that would otherwise be covered by the 
     plan or coverage involved; and
       ``(6) subject to subsection (f)(3), restrict benefits for 
     any portion of a period within a hospital length of stay 
     required under subsection (a) in a manner which is less 
     favorable than the benefits provided for any preceding 
     portion of such stay.
       ``(f) Rules of Construction.--
       ``(1) In general.--Nothing in this section shall be 
     construed to require a woman who is a participant or 
     beneficiary--
       ``(A) to undergo a mastectomy or lymph node dissection in a 
     hospital; or
       ``(B) to stay in the hospital for a fixed period of time 
     following a mastectomy or lymph node dissection.
       ``(2) Limitation.--This section shall not apply with 
     respect to any group health plan, or any group health 
     insurance coverage offered by a health insurance issuer, 
     which does not provide benefits for hospital lengths of stay 
     in connection with a mastectomy or lymph node dissection for 
     the treatment of breast cancer.
       ``(3) Cost sharing.--Nothing in this section shall be 
     construed as preventing a group health plan or issuer from 
     imposing deductibles, coinsurance, or other cost-sharing in 
     relation to benefits for hospital lengths of stay in 
     connection with a mastectomy or lymph node dissection for the 
     treatment of breast cancer under the plan (or under health 
     insurance coverage offered in connection with a group health 
     plan), except that such coinsurance or other cost-sharing for 
     any portion of a period within a hospital length of stay 
     required under subsection (a) may not be greater than such 
     coinsurance or cost-sharing for any preceding portion of such 
     stay.
       ``(4) Level and type of reimbursements.--Nothing in this 
     section shall be construed to prevent a group health plan or 
     a health insurance issuer offering group health insurance 
     coverage from negotiating the level and type of reimbursement 
     with a provider for care provided in accordance with this 
     section.
       ``(g) Safe Harbors.--The provisions of this section shall 
     not be applicable to any group health plan or health 
     insurance issuer in connection with a group health plan for 
     any plan year for which such plan has voluntarily sought and 
     received certification from the National Cancer Institute, or 
     any similar entity authorized by the Secretary, that such 
     plan provides appropriate coverage, consistent with the 
     objectives of this section, for mastectomies, lumpectomies 
     and lymph node dissection for the treatment of breast cancer.
       ``(h) Preemption, Relation to State Laws.--
       ``(1) In general.--Nothing in this section may be construed 
     to prohibit a State from establishing, implementing or 
     continuing in effect any standard or requirement not 
     prohibited by this section unless such standard or 
     requirement is inconsistent with, in conflict with, or 
     prevents the application of a standard or requirement of this 
     section. With respect to a standard or requirement that is 
     directly or indirectly prohibited by this section, a State 
     may not establish, implement or continue in effect any 
     requirement or standard that is different from or in addition 
     to, or that is not otherwise identical with, or does not 
     provide patient protections similar to, the standards or 
     requirements established under this section.
       ``(2) Preemption.--Nothing in this section shall be 
     construed to affect or modify the provisions of section 514 
     of the Employee Retirement Income Security Act of 1974 with 
     respect to group health plans.''.
       (b) Effective Dates.--
       (1) In general.--The amendments made by this section shall 
     apply to group health plans for plan years beginning on or 
     after the date of enactment of this Act.
       (2) Special rule for collective bargaining agreements.--In 
     the case of a group health plan maintained pursuant to 1 or 
     more collective bargaining agreements between employee 
     representatives and 1 or more employers ratified before the 
     date of enactment of this Act, the amendments made by this 
     section shall not apply to plan years beginning before the 
     later of--
       (A) the date on which the last collective bargaining 
     agreements relating to the plan terminates (determined 
     without regard to any extension thereof agreed to after the 
     date of enactment of this Act), or
       (B) January 1, 1999.
     For purposes of subparagraph (A), any plan amendment made 
     pursuant to a collective bargaining agreement relating to the 
     plan which amends the plan solely to conform to any 
     requirement added by this section shall not be treated as a 
     termination of such collective bargaining agreement.

     SEC. ____05. AMENDMENT TO THE PUBLIC HEALTH SERVICE ACT 
                   RELATING TO THE INDIVIDUAL MARKET.

       (a) In General.--Subpart 3 of part B of title XXVII of the 
     Public Health Service Act (as added by section 605(a) of the 
     Newborn's and Mother's Health Protection Act of 1996) is 
     amended by adding at the end the following new section:

     ``SEC. 2752. REQUIRED COVERAGE FOR MINIMUM HOSPITAL STAY FOR 
                   MASTECTOMIES AND LYMPH NODE DISSECTIONS FOR THE 
                   TREATMENT OF BREAST CANCER.

       ``The provisions of section 2706 shall apply to health 
     insurance coverage offered by a health insurance issuer in 
     the individual market in the same manner as they apply to 
     health insurance coverage offered by a health insurance 
     issuer in connection with a group health plan in the small or 
     large group market.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply with respect to health insurance coverage 
     offered, sold, issued, renewed, in effect, or operated in the 
     individual market on or after the date of enactment of this 
     Act.

     SEC. ____06. AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1986.

       (a) In General.--Chapter 100 of the Internal Revenue Code 
     of 1986 (relating to group health plan portability, access, 
     and renewability requirements) is amended by redesignating 
     sections 9804, 9805, and 9806 as sections 9805, 9806, and 
     9807, respectively, and by inserting after section 9803 the 
     following new section:

     ``SEC. 9804. REQUIRED COVERAGE FOR MINIMUM HOSPITAL STAY FOR 
                   MASTECTOMIES AND LYMPH NODE DISSECTIONS FOR THE 
                   TREATMENT OF BREAST CANCER AND COVERAGE FOR 
                   RECONSTRUCTIVE SURGERY FOLLOWING MASTECTOMIES.

       ``(a) Inpatient Care.--
       ``(1) In general.--A group health plan, and a health 
     insurance issuer providing health insurance coverage in 
     connection with a group health plan, that provides medical 
     and surgical benefits shall ensure that inpatient coverage 
     with respect to the treatment of breast cancer is provided 
     for a period of time as is determined by the attending 
     physician, in his or her professional judgment consistent 
     with generally accepted medical standards, in consultation 
     with the patient, to be medically appropriate following--
       ``(A) a mastectomy;
       ``(B) a lumpectomy; or
       ``(C) a lymph node dissection for the treatment of breast 
     cancer.
       ``(2) Exception.--Nothing in this section shall be 
     construed as requiring the provision of inpatient coverage if 
     the attending physician and patient determine that a shorter 
     period of hospital stay is medically appropriate.
       ``(b) Reconstructive Surgery.--A group health plan, and a 
     health insurance issuer providing health insurance coverage 
     in connection with a group health plan, that provides medical 
     and surgical benefits with respect to a mastectomy shall 
     ensure that, in a case in which a mastectomy patient elects 
     breast reconstruction, coverage is provided for--
       ``(1) all stages of reconstruction of the breast on which 
     the mastectomy has been performed;
       ``(2) surgery and reconstruction of the other breast to 
     produce a symmetrical appearance; and
       ``(3) the costs of prostheses and complications of 
     mastectomy including lymphodemas;
     in the manner determined by the attending physician and the 
     patient to be appropriate. Such coverage may be subject to 
     annual deductibles and coinsurance provisions as may be 
     deemed appropriate and as are consistent with those 
     established for other benefits under the plan or coverage. 
     Written notice of the availability of such coverage shall be 
     delivered to the participant upon enrollment and annually 
     thereafter.
       ``(c) Notice.--A group health plan, and a health insurance 
     issuer providing health insurance coverage in connection with 
     a group health plan shall provide notice to each participant 
     and beneficiary under such plan regarding the coverage 
     required by this section in accordance with regulations 
     promulgated by the Secretary. Such notice shall be in writing 
     and prominently positioned in any literature or 
     correspondence made available or distributed by the plan or 
     issuer and shall be transmitted--
       ``(1) in the next mailing made by the plan or issuer to the 
     participant or beneficiary;
       ``(2) as part of any yearly informational packet sent to 
     the participant or beneficiary; or
       ``(3) not later than January 1, 1998;
     whichever is earlier.
       ``(d) No Authorization Required.--
       ``(1) In general.--A, attending physician shall not be 
     required to obtain authorization from the plan or issuer for 
     prescribing any length of stay in connection with a 
     mastectomy, a lumpectomy, or a lymph node dissection for the 
     treatment of breast cancer.
       ``(2) Prenotification.--Nothing in this section shall be 
     construed as preventing a plan or issuer from requiring 
     prenotification of an inpatient stay referred to in this 
     section if

[[Page S2228]]

     such requirement is consistent with terms and conditions 
     applicable to other inpatient benefits under the plan, except 
     that the provision of such inpatient stay benefits shall not 
     be contingent upon such notification.
       ``(e) Prohibitions.--A group health plan, and a health 
     insurance issuer offering group health insurance coverage in 
     connection with a group health plan, may not--
       ``(1) deny to a woman eligibility, or continued 
     eligibility, to enroll or to renew coverage under the terms 
     of the plan, solely for the purpose of avoiding the 
     requirements of this section;
       ``(2) provide monetary payments or rebates to individuals 
     to encourage such individuals to accept less than the minimum 
     protections available under this section;
       ``(3) penalize or otherwise reduce or limit the 
     reimbursement of an attending provider because such provider 
     provided care to an individual participant or beneficiary in 
     accordance with this section;
       ``(4) provide incentives (monetary or otherwise) to an 
     attending provider to induce such provider to provide care to 
     an individual participant or beneficiary in a manner 
     inconsistent with this section;
       ``(5) provide financial or other incentives to a physician 
     or specialist to induce the physician or specialist to 
     refrain from referring a participant or beneficiary for a 
     secondary consultation that would otherwise be covered by the 
     plan or coverage involved; and
       ``(6) subject to subsection (f)(3), restrict benefits for 
     any portion of a period within a hospital length of stay 
     required under subsection (a) in a manner which is less 
     favorable than the benefits provided for any preceding 
     portion of such stay.
       ``(f) Rules of Construction.--
       ``(1) In general.--Nothing in this section shall be 
     construed to require a woman who is a participant or 
     beneficiary--
       ``(A) to undergo a mastectomy or lymph node dissection in a 
     hospital; or
       ``(B) to stay in the hospital for a fixed period of time 
     following a mastectomy or lymph node dissection.
       ``(2) Limitation.--This section shall not apply with 
     respect to any group health plan, or any group health 
     insurance coverage offered by a health insurance issuer, 
     which does not provide benefits for hospital lengths of stay 
     in connection with a mastectomy or lymph node dissection for 
     the treatment of breast cancer.
       ``(3) Cost sharing.--Nothing in this section shall be 
     construed as preventing a group health plan or issuer from 
     imposing deductibles, coinsurance, or other cost-sharing in 
     relation to benefits for hospital lengths of stay in 
     connection with a mastectomy or lymph node dissection for the 
     treatment of breast cancer under the plan (or under health 
     insurance coverage offered in connection with a group health 
     plan), except that such coinsurance or other cost-sharing for 
     any portion of a period within a hospital length of stay 
     required under subsection (a) may not be greater than such 
     coinsurance or cost-sharing for any preceding portion of such 
     stay.
       ``(4) Level and type of reimbursements.--Nothing in this 
     section shall be construed to prevent a group health plan or 
     a health insurance issuer offering group health insurance 
     coverage from negotiating the level and type of reimbursement 
     with a provider for care provided in accordance with this 
     section.
       ``(g) Safe Harbors.--The provisions of this section shall 
     not be applicable to any group health plan or health 
     insurance issuer in connection with a group health plan for 
     any plan year for which such plan has voluntarily sought and 
     received certification from the National Cancer Institute, or 
     any similar entity authorized by the Secretary, that such 
     plan provides appropriate coverage, consistent with the 
     objectives of this section, for mastectomies, lumpectomies 
     and lymph node dissection for the treatment of breast cancer.
       ``(h) Preemption, Relation to State Laws.--
       ``(1) In general.--Nothing in this section may be construed 
     to prohibit a State from establishing, implementing or 
     continuing in effect any standard or requirement not 
     prohibited by this section unless such standard or 
     requirement is inconsistent with, in conflict with, or 
     prevents the application of a standard or requirement of this 
     section. With respect to a standard or requirement that is 
     directly or indirectly prohibited by this section, a State 
     may not establish, implement or continue in effect any 
     requirement or standard that is different from or in addition 
     to, or that is not otherwise identical with, or does not 
     provide patient protections similar to, the standards or 
     requirements established under this section.
       ``(2) Preemption.--Nothing in this section shall be 
     construed to affect or modify the provisions of section 514 
     of the Employee Retirement Income Security Act of 1974 with 
     respect to group health plans.''.
       (b) Conforming Amendments.--
       (1) Sections 9801(c)(1), 9805(b) (as redesignated by 
     subsection (a)), 9805(c) (as so redesignated), 
     4980D(c)(3)(B)(i)(I), 4980D(d)(3), and 4980D(f)(1) of such 
     Code are each amended by striking ``9805'' each place it 
     appears and inserting ``9806''.
       (2) The heading for subtitle K of such Code is amended to 
     read as follows:
``Subtitle K--Group Health Plan Portability, Access, Renewability, and 
                         Other Requirements''.
       (3) The heading for chapter 100 of such Code is amended to 
     read as follows:

``CHAPTER 100--GROUP HEALTH PLAN PORTABILITY, ACCESS, RENEWABILITY, AND 
                         OTHER REQUIREMENTS''.

       (4) Section 4980D(a) of such Code is amended by striking 
     ``and renewability'' and inserting ``renewability, and 
     other''.
       (c) Clerical Amendments.--
       (1) The table of contents for chapter 100 of such Code is 
     amended by redesignating the items relating to sections 9804, 
     9805, and 9806 as items relating to sections 9805, 9806, and 
     9807, and by inserting after the item relating to section 
     9803 the following new item:

``Sec. 9804. Required coverage for minimum hospital stay for 
              mastectomies and lymph node dissections for the treatment 
              of breast cancer and coverage for reconstructive surgery 
              following mastectomies.''.

       (2) The item relating to subtitle K in the table of 
     subtitles for such Code is amended by striking ``and 
     renewability'' and inserting ``renewability, and other''.
       (3) The item relating to chapter 100 in the table of 
     chapters for subtitle K of such Code is amended by striking 
     ``and renewability'' and inserting ``renewability, and 
     other''.
       (d) Effective Dates.--
       (1) In general.--The amendments made by this section shall 
     apply with respect to plan years beginning on or after the 
     date of enactment of this Act.
       (2) Special rule for collective bargaining agreements.--In 
     the case of a group health plan maintained pursuant to 1 or 
     more collective bargaining agreements between employee 
     representatives and 1 or more employers ratified before the 
     date of enactment of this Act, the amendments made by this 
     section shall not apply to plan years beginning before the 
     later of--
       (A) the date on which the last collective bargaining 
     agreements relating to the plan terminates (determined 
     without regard to any extension thereof agreed to after the 
     date of enactment of this Act), or
       (B) January 1, 1999.
     For purposes of subparagraph (A), any plan amendment made 
     pursuant to a collective bargaining agreement relating to the 
     plan which amends the plan solely to conform to any 
     requirement added by this section shall not be treated as a 
     termination of such collective bargaining agreement.

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