[Congressional Record Volume 146, Number 56 (Tuesday, May 9, 2000)]
[House]
[Pages H2667-H2675]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                      LONG-TERM CARE SECURITY ACT

  Mr. SCARBOROUGH. Mr. Speaker, I move to suspend the rules and pass 
the

[[Page H2668]]

bill (H.R. 4040) to amend title 5, United States Code, to provide for 
the establishment of a program under which long-term care insurance is 
made available to Federal employees, members of the uniformed services, 
and civilian and military retirees, and for other purposes, as amended.
  The Clerk read as follows:

                               H.R. 4040

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Long-Term Care Security 
     Act''.

     SEC. 2. LONG-TERM CARE INSURANCE.

       (a) In General.--Subpart G of part III of title 5, United 
     States Code, is amended by adding at the end the following:

                 ``CHAPTER 90--LONG-TERM CARE INSURANCE

``Sec.
``9001. Definitions.
``9002. Availability of insurance.
``9003. Contracting authority.
``9004. Financing.
``9005. Preemption.
``9006. Studies, reports, and audits.
``9007. Jurisdiction of courts.
``9008. Administrative functions.
``9009. Cost accounting standards.

     ``Sec. 9001. Definitions

       For purposes of this chapter:
       ``(1) Employee.--The term `employee' means--
       ``(A) an employee as defined by section 8901(1); and
       ``(B) an individual described in section 2105(e);

     but does not include an individual employed by the government 
     of the District of Columbia.
       ``(2) Annuitant.--The term `annuitant' has the meaning such 
     term would have under paragraph (3) of section 8901 if, for 
     purposes of such paragraph, the term `employee' were 
     considered to have the meaning given to it under paragraph 
     (1) of this subsection.
       ``(3) Member of the uniformed services.--The term `member 
     of the uniformed services' means a member of the uniformed 
     services, other than a retired member of the uniformed 
     services, who is--
       ``(A) on active duty or full-time National Guard duty for a 
     period of more than 30 days; and
       ``(B) a member of the Selected Reserve.
       ``(4) Retired member of the uniformed services.--The term 
     `retired member of the uniformed services' means a member or 
     former member of the uniformed services entitled to retired 
     or retainer pay, including a member or former member retired 
     under chapter 1223 of title 10 who has attained the age of 60 
     and who satisfies such eligibility requirements as the Office 
     of Personnel Management prescribes under section 9008.
       ``(5) Qualified relative.--The term `qualified relative' 
     means each of the following:
       ``(A) The spouse of an individual described in paragraph 
     (1), (2), (3), or (4).
       ``(B) A parent, stepparent, or parent-in-law of an 
     individual described in paragraph (1) or (3).
       ``(C) A child (including an adopted child, a stepchild, or, 
     to the extent the Office of Personnel Management by 
     regulation provides, a foster child) of an individual 
     described in paragraph (1), (2), (3), or (4), if such child 
     is at least 18 years of age.
       ``(D) An individual having such other relationship to an 
     individual described in paragraph (1), (2), (3), or (4) as 
     the Office may by regulation prescribe.
       ``(6) Eligible individual.--The term `eligible individual' 
     refers to an individual described in paragraph (1), (2), (3), 
     (4), or (5).
       ``(7) Qualified carrier.--The term `qualified carrier' 
     means an insurance company (or consortium of insurance 
     companies) that is licensed to issue long-term care insurance 
     in all States, taking any subsidiaries of such a company into 
     account (and, in the case of a consortium, considering the 
     member companies and any subsidiaries thereof, collectively).
       ``(8) State.--The term `State' includes the District of 
     Columbia.
       ``(9) Qualified long-term care insurance contract.--The 
     term `qualified long-term care insurance contract' has the 
     meaning given such term by section 7702B of the Internal 
     Revenue Code of 1986.
       ``(10) Appropriate secretary.--The term `appropriate 
     Secretary' means--
       ``(A) except as otherwise provided in this paragraph, the 
     Secretary of Defense;
       ``(B) with respect to the Coast Guard when it is not 
     operating as a service of the Navy, the Secretary of 
     Transportation;
       ``(C) with respect to the commissioned corps of the 
     National Oceanic and Atmospheric Administration, the 
     Secretary of Commerce; and
       ``(D) with respect to the commissioned corps of the Public 
     Health Service, the Secretary of Health and Human Services.

     ``Sec. 9002. Availability of insurance

       ``(a) In General.--The Office of Personnel Management shall 
     establish and, in consultation with the appropriate 
     Secretaries, administer a program through which an individual 
     described in paragraph (1), (2), (3), (4), or (5) of section 
     9001 may obtain long-term care insurance coverage under this 
     chapter for such individual.
       ``(b) General Requirements.--Long-term care insurance may 
     not be offered under this chapter unless--
       ``(1) the only coverage provided is under qualified long-
     term care insurance contracts; and
       ``(2) each insurance contract under which any such coverage 
     is provided is issued by a qualified carrier.
       ``(c) Documentation Requirement.--As a condition for 
     obtaining long-term care insurance coverage under this 
     chapter based on one's status as a qualified relative, an 
     applicant shall provide documentation to demonstrate the 
     relationship, as prescribed by the Office.
       ``(d) Underwriting Standards.--
       ``(1) Disqualifying condition.--Nothing in this chapter 
     shall be considered to require that long-term care insurance 
     coverage be made available in the case of any individual who 
     would be eligible for benefits immediately.
       ``(2) Spousal parity.--For the purpose of underwriting 
     standards, a spouse of an individual described in paragraph 
     (1), (2), (3), or (4) of section 9001 shall, as nearly as 
     practicable, be treated like that individual.
       ``(3) Guaranteed issue.--Nothing in this chapter shall be 
     considered to require that long-term care insurance coverage 
     be guaranteed to an eligible individual.
       ``(4) Requirement that contract be fully insured.--In 
     addition to the requirements otherwise applicable under 
     section 9001(9), in order to be considered a qualified long-
     term care insurance contract for purposes of this chapter, a 
     contract must be fully insured, whether through reinsurance 
     with other companies or otherwise.
       ``(5) Higher standards allowable.--Nothing in this chapter 
     shall, in the case of an individual applying for long-term 
     care insurance coverage under this chapter after the 
     expiration of such individual's first opportunity to enroll, 
     preclude the application of underwriting standards more 
     stringent than those that would have applied if that 
     opportunity had not yet expired.
       ``(e) Guaranteed Renewability.--The benefits and coverage 
     made available to eligible individuals under any insurance 
     contract under this chapter shall be guaranteed renewable (as 
     defined by section 7A(2) of the model regulations described 
     in section 7702B(g)(2) of the Internal Revenue Code of 1986), 
     including the right to have insurance remain in effect so 
     long as premiums continue to be timely made. However, the 
     authority to revise premiums under this chapter shall be 
     available only on a class basis and only to the extent 
     otherwise allowable under section 9003(b).

     ``Sec. 9003. Contracting authority

       ``(a) In General.--The Office of Personnel Management 
     shall, without regard to section 5 of title 41 or any other 
     statute requiring competitive bidding, contract with 1 or 
     more qualified carriers for a policy or policies of long-term 
     care insurance. The Office shall ensure that each resulting 
     contract (hereinafter in this chapter referred to as a 
     `master contract') is awarded on the basis of contractor 
     qualifications, price, and reasonable competition.
       ``(b) Terms and Conditions.--
       ``(1) In general.--Each master contract under this chapter 
     shall contain--
       ``(A) a detailed statement of the benefits offered 
     (including any maximums, limitations, exclusions, and other 
     definitions of benefits);
       ``(B) the premiums charged (including any limitations or 
     other conditions on their subsequent adjustment);
       ``(C) the terms of the enrollment period; and
       ``(D) such other terms and conditions as may be mutually 
     agreed to by the Office and the carrier involved, consistent 
     with the requirements of this chapter.
       ``(2) Premiums.--Premiums charged under each master 
     contract entered into under this section shall reasonably and 
     equitably reflect the cost of the benefits provided, as 
     determined by the Office. The premiums shall not be adjusted 
     during the term of the contract unless mutually agreed to by 
     the Office and the carrier.
       ``(3) Nonrenewability.--Master contracts under this chapter 
     may not be made automatically renewable.
       ``(c) Payment of Required Benefits; Dispute Resolution.--
       ``(1) In general.--Each master contract under this chapter 
     shall require the carrier to agree--
       ``(A) to provide payments or benefits to an eligible 
     individual if such individual is entitled thereto under the 
     terms of the contract; and
       ``(B) with respect to disputes regarding claims for 
     payments or benefits under the terms of the contract--
       ``(i) to establish internal procedures designed to 
     expeditiously resolve such disputes; and
       ``(ii) to establish, for disputes not resolved through 
     procedures under clause (i), procedures for 1 or more 
     alternative means of dispute resolution involving independent 
     third-party review under appropriate circumstances by 
     entities mutually acceptable to the Office and the carrier.
       ``(2) Eligibility.--A carrier's determination as to whether 
     or not a particular individual is eligible to obtain long-
     term care insurance coverage under this chapter shall be 
     subject to review only to the extent and in the manner 
     provided in the applicable master contract.

[[Page H2669]]

       ``(3) Other claims.--For purposes of applying the Contract 
     Disputes Act of 1978 to disputes arising under this chapter 
     between a carrier and the Office--
       ``(A) the agency board having jurisdiction to decide an 
     appeal relative to such a dispute shall be such board of 
     contract appeals as the Director of the Office of Personnel 
     Management shall specify in writing (after appropriate 
     arrangements, as described in section 8(c) of such Act); and
       ``(B) the district courts of the United States shall have 
     original jurisdiction, concurrent with the United States 
     Court of Federal Claims, of any action described in section 
     10(a)(1) of such Act relative to such a dispute.
       ``(4) Rule of construction.--Nothing in this chapter shall 
     be considered to grant authority for the Office or a third-
     party reviewer to change the terms of any contract under this 
     chapter.
       ``(d) Duration.--
       ``(1) In general.--Each master contract under this chapter 
     shall be for a term of 7 years, unless terminated earlier by 
     the Office in accordance with the terms of such contract. 
     However, the rights and responsibilities of the enrolled 
     individual, the insurer, and the Office (or duly designated 
     third-party administrator) under such contract shall continue 
     with respect to such individual until the termination of 
     coverage of the enrolled individual or the effective date of 
     a successor contract thereto.
       ``(2) Exception.--
       ``(A) Shorter duration.--In the case of a master contract 
     entered into before the end of the period described in 
     subparagraph (B), paragraph (1) shall be applied by 
     substituting `ending on the last day of the 7-year period 
     described in paragraph (2)(B)' for `of 7 years'.
       ``(B) Definition.--The period described in this 
     subparagraph is the 7-year period beginning on the earliest 
     date as of which any long-term care insurance coverage under 
     this chapter becomes effective.
       ``(3) Congressional notification.--No later than 180 days 
     after receiving the second report required under section 
     9006(c), the President (or his designee) shall submit to the 
     Committees on Government Reform and on Armed Services of the 
     House of Representatives and the Committees on Governmental 
     Affairs and on Armed Services of the Senate, a written 
     recommendation as to whether the program under this chapter 
     should be continued without modification, terminated, or 
     restructured. During the 180-day period following the date on 
     which the President (or his designee) submits the 
     recommendation required under the preceding sentence, the 
     Office of Personnel Management may not take any steps to 
     rebid or otherwise contract for any coverage to be available 
     at any time following the expiration of the 7-year period 
     described in paragraph (2)(B).
       ``(4) Full portability.--Each master contract under this 
     chapter shall include such provisions as may be necessary to 
     ensure that, once an individual becomes duly enrolled, long-
     term care insurance coverage obtained by such individual 
     pursuant to that enrollment shall not be terminated due to 
     any change in status (such as separation from Government 
     service or the uniformed services) or ceasing to meet the 
     requirements for being considered a qualified relative 
     (whether as a result of dissolution of marriage or 
     otherwise).

     ``Sec. 9004. Financing

       ``(a) In General.--Each eligible individual obtaining long-
     term care insurance coverage under this chapter shall be 
     responsible for 100 percent of the premiums for such 
     coverage.
       ``(b) Withholdings.--
       ``(1) In general.--The amount necessary to pay the premiums 
     for enrollment may--
       ``(A) in the case of an employee, be withheld from the pay 
     of such employee;
       ``(B) in the case of an annuitant, be withheld from the 
     annuity of such annuitant;
       ``(C) in the case of a member of the uniformed services 
     described in section 9001(3), be withheld from the pay of 
     such member; and
       ``(D) in the case of a retired member of the uniformed 
     services described in section 9001(4), be withheld from the 
     retired pay or retainer pay payable to such member.
       ``(2) Voluntary withholdings for qualified relatives.--
     Withholdings to pay the premiums for enrollment of a 
     qualified relative may, upon election of the appropriate 
     eligible individual (described in section 9001(1)-(4)), be 
     withheld under paragraph (1) to the same extent and in the 
     same manner as if enrollment were for such individual.
       ``(c) Direct Payments.--All amounts withheld under this 
     section shall be paid directly to the carrier.
       ``(d) Other Forms of Payment.--Any enrollee who does not 
     elect to have premiums withheld under subsection (b) or whose 
     pay, annuity, or retired or retainer pay (as referred to in 
     subsection (b)(1)) is insufficient to cover the withholding 
     required for enrollment (or who is not receiving any regular 
     amounts from the Government, as referred to in subsection 
     (b)(1), from which any such withholdings may be made, and 
     whose premiums are not otherwise being provided for under 
     subsection (b)(2)) shall pay an amount equal to the full 
     amount of those charges directly to the carrier.
       ``(e) Separate Accounting Requirement.--Each carrier 
     participating under this chapter shall maintain records that 
     permit it to account for all amounts received under this 
     chapter (including investment earnings on those amounts) 
     separate and apart from all other funds.
       ``(f) Reimbursements.--
       ``(1) Reasonable initial costs.--
       ``(A) In general.--The Employees' Life Insurance Fund is 
     available, without fiscal year limitation, for reasonable 
     expenses incurred by the Office of Personnel Management in 
     administering this chapter before the start of the 7-year 
     period described in section 9003(d)(2)(B), including 
     reasonable implementation costs.
       ``(B) Reimbursement requirement.--Such Fund shall be 
     reimbursed, before the end of the first year of that 7-year 
     period, for all amounts obligated or expended under 
     subparagraph (A) (including lost investment income). Such 
     reimbursement shall be made by carriers, on a pro rata basis, 
     in accordance with appropriate provisions which shall be 
     included in master contracts under this chapter.
       ``(2) Subsequent costs.--
       ``(A) In general.--There is hereby established in the 
     Employees' Life Insurance Fund a Long-Term Care 
     Administrative Account, which shall be available to the 
     Office, without fiscal year limitation, to defray reasonable 
     expenses incurred by the Office in administering this chapter 
     after the start of the 7-year period described in section 
     9003(d)(2)(B).
       ``(B) Reimbursement requirement.--Each master contract 
     under this chapter shall include appropriate provisions under 
     which the carrier involved shall, during each year, make such 
     periodic contributions to the Long-Term Care Administrative 
     Account as necessary to ensure that the reasonable 
     anticipated expenses of the Office in administering this 
     chapter during such year (adjusted to reconcile for any 
     earlier overestimates or underestimates under this 
     subparagraph) are defrayed.

     ``Sec. 9005. Preemption

       ``The terms of any contract under this chapter which relate 
     to the nature, provision, or extent of coverage or benefits 
     (including payments with respect to benefits) shall supersede 
     and preempt any State or local law, or any regulation issued 
     thereunder, which relates to long-term care insurance or 
     contracts.

     ``Sec. 9006. Studies, reports, and audits

       ``(a) Provisions Relating to Carriers.--Each master 
     contract under this chapter shall contain provisions 
     requiring the carrier--
       ``(1) to furnish such reasonable reports as the Office of 
     Personnel Management determines to be necessary to enable it 
     to carry out its functions under this chapter; and
       ``(2) to permit the Office and representatives of the 
     General Accounting Office to examine such records of the 
     carrier as may be necessary to carry out the purposes of this 
     chapter.
       ``(b) Provisions Relating to Federal Agencies.--Each 
     Federal agency shall keep such records, make such 
     certifications, and furnish the Office, the carrier, or both, 
     with such information and reports as the Office may require.
       ``(c) Reports by the General Accounting Office.--The 
     General Accounting Office shall prepare and submit to the 
     President, the Office of Personnel Management, and each House 
     of Congress, before the end of the third and fifth years 
     during which the program under this chapter is in effect, a 
     written report evaluating such program. Each such report 
     shall include an analysis of the competitiveness of the 
     program, as compared to both group and individual coverage 
     generally available to individuals in the private insurance 
     market. The Office shall cooperate with the General 
     Accounting Office to provide periodic evaluations of the 
     program.

     ``Sec. 9007. Jurisdiction of courts

       ``The district courts of the United States have original 
     jurisdiction of a civil action or claim described in 
     paragraph (1) or (2) of section 9003(c), after such 
     administrative remedies as required under such paragraph (1) 
     or (2) (as applicable) have been exhausted, but only to the 
     extent judicial review is not precluded by any dispute 
     resolution or other remedy under this chapter.

     ``Sec. 9008. Administrative functions

       ``(a) In General.--The Office of Personnel Management shall 
     prescribe regulations necessary to carry out this chapter.
       ``(b) Enrollment Periods.--The Office shall provide for 
     periodic coordinated enrollment, promotion, and education 
     efforts in consultation with the carriers.
       ``(c) Consultation.--Any regulations necessary to effect 
     the application and operation of this chapter with respect to 
     an eligible individual described in paragraph (3) or (4) of 
     section 9001, or a qualified relative thereof, shall be 
     prescribed by the Office in consultation with the appropriate 
     Secretary.
       ``(d) Informed Decisionmaking.--The Office shall ensure 
     that each eligible individual applying for long-term care 
     insurance under this chapter is furnished the information 
     necessary to enable that individual to evaluate the 
     advantages and disadvantages of obtaining long-term care 
     insurance under this chapter, including the following:
       ``(1) The principal long-term care benefits and coverage 
     available under this chapter, and how those benefits and 
     coverage compare to the range of long-term care benefits and 
     coverage otherwise generally available.
       ``(2) Representative examples of the cost of long-term 
     care, and the sufficiency of the

[[Page H2670]]

     benefits available under this chapter relative to those 
     costs. The information under this paragraph shall also 
     include--
       ``(A) the projected effect of inflation on the value of 
     those benefits; and
       ``(B) a comparison of the inflation-adjusted value of those 
     benefits to the projected future costs of long-term care.
       ``(3) Any rights individuals under this chapter may have to 
     cancel coverage, and to receive a total or partial refund of 
     premiums. The information under this paragraph shall also 
     include--
       ``(A) the projected number or percentage of individuals 
     likely to fail to maintain their coverage (determined based 
     on lapse rates experienced under similar group long-term care 
     insurance programs and, when available, this chapter); and
       ``(B)(i) a summary description of how and when premiums for 
     long-term care insurance under this chapter may be raised;
       ``(ii) the premium history during the last 10 years for 
     each qualified carrier offering long-term care insurance 
     under this chapter; and
       ``(iii) if cost increases are anticipated, the projected 
     premiums for a typical insured individual at various ages.
       ``(4) The advantages and disadvantages of long-term care 
     insurance generally, relative to other means of accumulating 
     or otherwise acquiring the assets that may be needed to meet 
     the costs of long-term care, such as through tax-qualified 
     retirement programs or other investment vehicles.

     ``Sec. 9009. Cost accounting standards

       ``The cost accounting standards issued pursuant to section 
     26(f) of the Office of Federal Procurement Policy Act (41 
     U.S.C. 422(f)) shall not apply with respect to a long-term 
     care insurance contract under this chapter.''.
       (b) Conforming Amendment.--The analysis for part III of 
     title 5, United States Code, is amended by adding at the end 
     of subpart G the following:

``90. Long-Term Care Insurance.................................9001.''.

      SEC. 3. EFFECTIVE DATE.

       The Office of Personnel Management shall take such measures 
     as may be necessary to ensure that long-term care insurance 
     coverage under title 5, United States Code, as amended by 
     this Act, may be obtained in time to take effect not later 
     than the first day of the first applicable pay period of the 
     first fiscal year which begins after the end of the 18-month 
     period beginning on the date of enactment of this Act.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Florida (Mr. Scarborough) and the gentleman from Maryland (Mr. 
Cummings) each will control 20 minutes.
  The Chair recognizes the gentleman from Florida (Mr. Scarborough).


                             General Leave

  Mr. SCARBOROUGH. Mr. Speaker, I ask unanimous consent that all 
Members may have 5 legislative days within which to revise and extend 
their remarks on the bill, H.R. 4040.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Florida?
  There was no objection.
  Mr. SCARBOROUGH. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, the Long-Term Care Security Act that we are considering 
today is a consensus bill. It is reflective of the hard work and 
dedication of Members on both sides of the aisle.
  I want to begin by thanking my distinguished ranking member, the 
gentleman from Maryland (Mr. Cummings), for his continued hard work and 
cooperation through this process. I also appreciate the leadership of 
my predecessor as chairman of this subcommittee, the gentleman from 
Florida (Mr. Mica). The gentleman from Florida (Mr. Mica) initiated the 
subcommittee's examination of long-term care, introducing the first 
long-term care bill during last Congress.
  The gentlewoman from Maryland (Mrs. Morella) has also worked hard to 
create a long-term care insurance program for Federal employees and 
retirees. And I would also like to thank the chairman of the committee, 
the gentleman from Indiana (Mr. Burton), and the ranking member, the 
gentleman from California (Mr. Waxman), for their support and hard work 
on this bill, and so many others, Mr. Speaker, including just everybody 
on the subcommittee, who really have done so much to make this work.
  As chairman of the subcommittee, long-term care insurance has been my 
top priority. During this Congress the subcommittee held three hearings 
on long-term care which demonstrated the importance of long-term care 
insurance. Longer life spans are leading to a rise in the number of 
Americans who are likely to need some form of long-term care, which 
today can cost as much as $50,000 a year. By 2030, the American Council 
of Life Insurers estimates that a year in a nursing home will cost as 
much as $190,000. Mr. Speaker, few Federal employees would be able to 
bear these costs without liquidating everything that they have worked 
so long for.
  Long-term care insurance will help Federal workers plan for this risk 
while protecting themselves and their loved ones of the indignities of 
the Medicaid spend-down process that so many have to go through right 
now. Under the Long-Term Care Security Act, Federal employees, members 
of the uniformed services, and both civilian and military retirees may 
purchase long-term care insurance sponsored by their employer.
  As one of the Nation's largest employers, the success of our program 
will undoubtedly influence other employers across this land. Just as we 
are following the lead of many private employers who offer this benefit 
to their workforces today, I really believe that other companies are 
likely to follow the government's lead and offer their own employees 
this very important protection.

                              {time}  1200

  This legislation will allow insurance carriers and the Office of 
Personnel Management to design flexible benefit packages to satisfy the 
widely varying needs of our diverse population. Employees, members of 
the uniformed services, and retirees will also have the opportunity to 
obtain long-term care insurance for their spouses, their children, and 
other close relatives.
  We expect competition between the carriers in the bidding process to 
keep premiums affordable for the entire Federal community. And that is 
important.
  Coupled with less stringent underwriting requirements for those who 
enroll at their first opportunity, reasonable premiums should encourage 
many employees to purchase long-term care insurance.
  Ultimately, the success of our collective efforts will be measured by 
the number of employees who buy insurance under this program. That is 
why this bill provides for close Congressional scrutiny as the program 
develops. Congress will receive periodic reports from the General 
Accounting Office and the Office of Personnel Management. The 
subcommittee will carefully monitor the implementation of this program 
to ensure that it offers high quality coverage at very competitive 
premiums.
  Mr. Speaker, I encourage all Members to support this very, very 
important bill.
  Mr. Speaker, I reserve the balance of my time.
  Mr. CUMMINGS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I commend the gentleman from Florida (Chairman 
Scarborough) and the gentleman from California (Mr. Waxman), the 
gentleman from Maine (Mr. Allen), the gentleman from Florida (Mr. Mica) 
and the gentlewoman from Maryland (Mrs. Morella) for working diligently 
to bring this bipartisan bill to fruition.
  And another one of our Members, the gentlewoman from the District of 
Columbia (Ms. Norton), has worked so hard on this legislation.
  Mr. Speaker, I yield 3\1/2\ minutes to the distinguished gentlewoman 
from Washington, D.C. (Ms. Norton).
  Ms. NORTON. Mr. Speaker, I thank the gentleman for his kindness in 
yielding to me. I have an appointment off campus, and I appreciate his 
interrupting his opening remarks to yield to me.
  Mr. Speaker, I want to thank the gentleman from Florida (Chairman 
Scarborough) and the gentleman from Maryland (Mr. Cummings), the 
ranking member, because we have been working on this bill for 3 years, 
but this chairman and ranking member have brought this to fruition. 
There will be millions of Americans not only who work for the Federal 
workforce, but who see this leadership by example who will benefit by 
their leadership here.
  I want to thank the gentleman from Indiana (Chairman Burton) and the 
gentleman from California (Mr. Waxman) for coming together. This is a 
true bipartisan effort because the administration has been struggling 
for this, as well. What happened was that the three parties got 
together, the administration, the majority and minority, and we have an 
important break-through bill here.

[[Page H2671]]

  Mr. Speaker, there has been lots of concern on both sides of the 
aisle about prescription drugs. And while there might be, long-term 
care is the real sleeper. It is the nuclear bomb of health care because 
of the baby boom generation and what they are going to bring to the 
health care system.
  To be sure, 40 million Americans are without health care at all. And 
if that many do not have basic health care, imagine where the average 
American stands on long-term health care. People are living longer. The 
need for long-term health care is as plain as the nose on our faces. 
This bill is, therefore, major for its implications for the entire 
country.
  In providing no Federal contribution, this bill breaks with 
precedent. And I do regret that, because the Federal workforce has 
indeed always made some contribution. But given the cost and what it 
would mean to get that contribution and the importance of this bill, I 
believe we have done the right thing in coming forward, particularly 
since the group coverage means that employees will get a 15- to 20-
percent discount and, therefore, will be able very often to afford this 
health care.
  Mr. Speaker, we have a huge workforce. What this bill does is to use 
the size of that workforce to advantage in the marketplace to bring 
long-term health care to the largest workforce in the United States.
  The effect on the largest population in the United States, the baby 
boomers, is going to be especially dramatic because their health care 
presents the greatest challenge to us all.
  What this bill does, very simply, is to prevent the spend-down of 
resources so that people then go on Medicaid. That is what happens now 
to middle-class Americans, they spend down everything they have; and 
then we end up picking up the cost.
  That is not what the average American wants to do. Affordable access 
to long-term health care will keep that from happening.
  Mr. Speaker, finally, I point to a series in The Washington Post this 
week. Every Member should read that series, because what it talks about 
is the depletion of the workforce with no replacements of any numbers 
coming in.
  The glamor of the private sector today, it used to be the public 
sector that was glamorous, but it is the private sector now, not to 
mention the high-tech sector, means that they are going everywhere, but 
the Federal sector, this is the kind of benefit that can help us draw 
badly needed workers to the Federal workforce.
  I am particularly grateful to the chairman and the ranking member for 
their work together that brought this moment to the House.
  Mr. SCARBOROUGH. Mr. Speaker, I yield myself such time as I may 
consume to thank the gentlewoman for her kind remarks. The hard work, 
really, that she and her staff contributed to this process made a huge 
difference.
  Mr. Speaker, I yield 4 minutes to the gentlewoman from Maryland (Mrs. 
Morella) who, as I said previously, had a huge impact on this debate, 
along with the gentleman from Florida (Mr. Mica) and others that have 
been fighting for it for some time.
  Mrs. MORELLA. Mr. Speaker, I certainly thank the gentleman for 
yielding me the time.
  Mr. Speaker, I must say I am thrilled that this bill is on the floor 
of the House of Representatives. I think it is a very important issue. 
I join my colleagues in supporting this legislation to provide group 
long-term care insurance for Federal employees and annuitants, active 
and retired military personnel, and their families. That means a policy 
of, like, 20 million people.
  It is critical that we pass this legislation. It takes an important 
step in helping our Nation's families cope with the enormous financial 
burden of long-term care. This bill, in its inception, has had long-
term care because we have been working on it for some time, and it was 
for more than a year and a half that I led Congressional efforts to 
make long-term care group insurance more accessible and more 
affordable.
  The legislation we are considering today, I am pleased to say, is 
really pretty much a template of the bill I introduced, H.R. 1111, the 
Federal Civilian and Uniformed Services Long-Term Care Insurance Act of 
1999.
  I do want to thank the 152 bipartisan cosponsors of that bill that 
was introduced on March 16, 1999, and ask that they support H.R. 4040.
  I also want to extend my gratitude and thanks to the many 
organizations who played an essential role in devising the framework 
for this legislation.
  First of all, Dan Adcock of the National Association of Retired 
Federal Employees was instrumental in guiding us every step of the way, 
as was Allen Lopatin, Frank Rohrbough of the Retired Officers 
Association, Cynthia Brock-Smith, Frank Titus, and Abby Block at the 
Office of Personnel Management also contributed; and the Alzheimer's 
Association, the Committee to Preserve Social Security and Medicare, 
the American Health Care Association, and the National Association of 
Uniformed Services. They all helped in developing this legislation 
before us.
  Until recently, my legislation was the only bill in the House that 
would make long-term care insurance available at group rates to active 
and retired Federal and military personnel, foreign service officers 
and their families at no cost to the Government.
  Indeed, now more than ever, Americans must take a long hard look at 
the way we finance the future health care needs of the Nation's 
seniors. The average senior turning 65 today can expect to live nearly 
20 more years, maybe even more; and nearly one-fourth of them will 
require nursing facility care at some point.
  Simply put, longer lives increase the likelihood of long-term care. 
This bill provides consumer protections. It also offers a series of 
choices. So it is good legislation.
  When the need for long-term care occurs, the financial and emotional 
impact can be devastating. Promoting this coverage will help to ease 
the pressure on Federal entitlement spending while protecting the 
assets of our Federal families. I also see this as a national model 
that the private sector may tend to look at and emulate.
  So I urge my colleagues to support this very important legislation.
  I also want to thank the staff who have been involved in putting this 
legislation together.
  Mr. CUMMINGS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, we are here today to debate consensus legislation that 
would provide long-term care insurance as a benefit package for Federal 
employees.
  I do pause again to thank the gentleman from Indiana (Mr. Burton), 
the chairman of our committee, and the gentleman from California (Mr. 
Waxman), our ranking member, and certainly the gentleman from Florida 
(Mr. Scarborough), the chairman of the subcommittee, and all the 
members of our committee for making this happen.
  During the 105th Congress, several bills were introduced in the House 
and Senate that would establish a long-term care insurance benefit for 
Federal employees.
  A little over a year ago on, January 6, 1999, I introduced H.R. 110, 
the Federal Employees Group Long-term Care Insurance Act of 1999. H.R. 
110 is the Federal employee portion of the administration's four-
pronged initiative to help families who need long-term care insurance.
  It provided a framework for implementing a long-term care program. It 
authorized the Office of Personnel Management to purchase group 
insurance policies from qualified private sector contractors, thereby 
making long-term care insurance more available to Federal employees, 
Federal retirees, and family families at more affordable group rates.
  The gentlewoman from Maryland (Mrs. Morella) introduced long-term 
care legislation which provided a framework similar to that proposed in 
H.R. 110, but extended coverage to active military personnel retirees 
and their families.
  The gentleman from Florida (Chairman Scarborough) introduced H.R. 
602, which was previously introduced by the gentleman from Florida (Mr. 
Mica), the former chairman in the 105th Congress.
  Though H.R. 602 provided a framework which allowed numerous insurance 
companies to sell long-term insurance policies to Federal employees, it 
further extended coverage to children, including adopted children, 
stepchildren, and stepparents.
  To his credit, the gentleman from Florida (Chairman Scarborough) 
introduced a true bipartisan consensus

[[Page H2672]]

 long-term care bill that reflects the hard work of this subcommittee 
over the past year and a half on this issue.
  Hours of research and collaboration with the administration, the 
insurance industry, and employee organizations have resulted in the 
introduction of H.R. 4040, the Long-Term Care Security Act.
  H.R. 4040 includes elements of all of the previously mentioned bills 
and adds a provision for spousal parity negotiated by ranking minority 
member, the gentleman from California (Mr. Waxman).
  I am pleased that the framework proposed in H.R. 110, allowing OPM to 
contract with a single carrier or consortia to provide long-term care 
insurance to Federal employees and permitting OPM to negotiate premiums 
and benefits on behalf of Federal employees, is adopted in H.R. 4040.
  This employer group model will allow Federal employees to realize 
from 15- to 20-percent in premium savings. And I emphasize that, 15 to 
20 percent.
  Due to the gentlewoman from Maryland (Mrs. Morella), coverage has 
been extended to the uniformed services in the bill. Blended families 
can thank the gentleman from Florida (Chairman Scarborough) for having 
the foresight to extend coverage to adopted children, stepchildren and 
stepparents.
  To ensure the financial solvency of the marital unit, the gentleman 
from California (Mr. Waxman), the ranking member, negotiated a 
provision in the act that would provide the spouses of Federal 
employees with the same, if not very similar, underwriting standards as 
at-work Federal employees.
  The enhanced underwriting for spouses would protect the assets of the 
couple by making it easier for spouses to qualify for participation in 
the program.
  During the Subcommittee on Civil Service markup, the gentleman from 
California (Mr. Waxman) offered an amendment that further improved the 
bill by including a section that provides that OPM furnish employees 
information on the average cost of nursing home care to the percentage 
of individuals who failed to maintain their coverage, the need for 
inflation protection and a summary of how long-term care premiums can 
be raised.
  I was pleased to support his amendment, which was unanimously agreed 
to.
  Private long-term care insurance provides one of the few available 
mechanisms for individuals to protect themselves against the 
catastrophic costs of long-term care. In addition, it provides 
alternatives to the type of care we receive when we need assistance 
with our personal care and other activities of daily living.

                              {time}  1215

  Whether enrollees choose the type of care that will allow them to 
``age in place,'' which will allow them to stay at home with their 
loved ones, community-based care, or nursing home care, they will be 
protected when they need it the most.
  I am pleased to be a part of this effort to bring long-term care 
insurance to Federal employees. Again I commend all the Members for 
their contribution to this bipartisan effort. In the end, civil 
servants who work diligently for the citizenry of this great country 
will benefit. As we take this action today, I am reminded of the 
discussion that took place in a hearing in Jacksonville, Florida, when 
we saw numerous people come forward and talk about the problems that 
they were experiencing not only taking care of their children but 
taking care of their parents. I know that their hearts must be glad 
today.
  At the minimum, the implementation of a long-term care benefit 
program by the Federal Government will challenge Federal employees to 
think about how they are going to finance and live out their elder 
years, something we should all be thinking about.
  Mr. Speaker, I reserve the balance of my time.
  Mr. SCARBOROUGH. Mr. Speaker, I yield myself such time as I may 
consume. I thank the gentleman from Maryland again for his hard work at 
our field hearings up in Baltimore, for his hard work in Jacksonville, 
and for the kind words that both he and the gentlewoman from the 
District of Columbia (Ms. Norton) have said today. He is right, this is 
a consensus bill. We have brought the best of all bills together. I 
thank him. We could not have done it without him.
  Mr. Speaker, I yield 3 minutes to the gentleman from Connecticut (Mr. 
Shays).
  Mr. SHAYS. Mr. Speaker, as a proponent and author of legislation 
designed to encourage the purchase of private long-term care insurance 
in general, I commend the Subcommittee on Civil Service chairman, the 
gentleman from Florida, for his hard work on this issue and also the 
gentleman from Maryland, the ranking member. I would also like to 
recognize the third part of that triumvirate, the gentlewoman from 
Maryland (Mrs. Morella), for her longstanding commitment to providing 
access to private long-term care for Federal employees.
  The Federal Employees Health Benefits Plan has long been held up as a 
model of health care delivery. It is really the best in the country. By 
providing all Federal employees access to private long-term care 
insurance, we are taking an important step toward recognizing the 
financial risks posed by long-term care and the need to plan for it.
  The Long Term Care Security Act that we are debating today, sets an 
example and encourages non-governmental employers to offer similar 
benefit options to their employees.
  Medicare does not pay for long-term care and seniors are forced, as 
we all know, to spend down their assets to qualify for Medicaid, which 
provides $33 billion in long-term care services each year for those who 
have few resources. This has serious financial repercussions for 
retirees and taxpayers who ultimately pay for long-term care assistance 
through public programs. As the baby boom generation retires, the 
purchase of private long-term care insurance is crucial to ease the 
financial strain on public resources.
  Mr. Speaker, I strongly support the Long Term Care Security Act, and 
thank all of those who were involved in bringing this important 
legislation to the floor. I would naturally urge all my colleagues on 
both sides of the aisle to support it.
  Again I thank the gentleman from Florida (Mr. Scarborough), the 
gentlewoman from Maryland (Mrs. Morella) and the gentleman from 
Maryland (Mr. Cummings).
  Mr. CUMMINGS. Mr. Speaker, it is my privilege to yield 4 minutes to 
the gentleman from California (Mr. Waxman), the ranking member of the 
Committee on Government Reform and one who has really played a very 
instrumental role in bringing us to where we are today. In introducing 
him, I also thank him for all that he has done to put this on the front 
burner and to bring us to where we are today.
  Mr. WAXMAN. I thank the gentleman very much for yielding time to me. 
I also am grateful for the kind words that he has said about me.
  Mr. Speaker, I rise in support of H.R. 4040, the Long Term Care 
Security Act, and I want to commend the gentleman from Florida (Mr. 
Scarborough) and the gentleman from Maryland (Mr. Cummings) for their 
work in producing a truly bipartisan bill.
  The need for long-term care affects us all. Those who need long-term 
care are our parents, our spouses, and inevitably ourselves. Many 
Americans have already dealt personally with a loved one in need of 
home or nursing home care. Many Americans have had the experience of 
trying to find services and to arrange for payment. Most people know 
that such care is hard to get and even harder to pay for.
  I support offering long-term care insurance as a benefit option to 
Federal employees. However, I also know that this is a product that can 
be misunderstood. When the Federal Government offers this option, it 
has a responsibility to ensure that Federal employees have the 
information necessary to make an informed choice.
  Mr. Speaker, I am especially pleased that a number of issues I raised 
were addressed in this legislation. I want to commend the gentleman 
from Florida for his willingness to work with us to ensure that these 
issues were addressed.
  The first issue of concern to me was that of spousal parity. I 
believe that spouses should be treated like Federal employees. The 
purpose of long-term care insurance is to protect the assets

[[Page H2673]]

of the insured when they are incapacitated. If one spouse has long-term 
care insurance and the other does not, the couple's financial assets as 
a family unit are at risk. For this reason, I am pleased that this bill 
includes a provision on spousal parity.
  Second, I believe that long-term care insurance should be available 
to everyone who needs it. Underwriting standards for employees and 
their spouses should be as minimal as possible. If we weed out through 
underwriting everyone who is likely to need long-term care, we will 
have failed to help those who most need help. For this reason, it was 
important to me to learn from OPM that their goal is to offer insurance 
on a modified guaranteed issue basis which would allow any Federal 
employee who is not immediately eligible for benefits to purchase long-
term care insurance. Their goal is also to apply these same standards 
to spouses if possible.
  My final concern, which was addressed in an amendment that I offered 
and was approved during the subcommittee markup, was to ensure that 
Federal employees are fully informed about the advantages and 
disadvantages of long-term care insurance.
  Long-term care insurance is a complicated product. For some it is a 
good way to save for the future but for others it can have serious 
drawbacks. Furthermore, the benefits of policies vary considerably in 
terms of duration of coverage, per diem allowances and other features 
such as inflation protection. Without adequate inflation protection, a 
long-term care policyholder may find that the benefits have simply 
eroded.
  Consumers do need to be aware of the consequences of dropping their 
policies. Many consumer protections are options, not part of a basic 
package. I am pleased this legislation requires that OPM provide 
employees with information on all these important aspects so they can 
make an informed decision.
  Long-term care insurance is a relatively new product and it has a 
limited track record. If the Federal Government begins offering long-
term care insurance, I believe it has a special responsibility to set 
high standards for informing consumers.
  Again I want to compliment the chairman of the Subcommittee on Civil 
Service of the Committee on Government Reform and the subcommittee's 
ranking minority member, the gentleman from Maryland, for their 
leadership on this issue. I urge my colleagues to support the bill.
  Mr. SCARBOROUGH. Mr. Speaker, I yield 3 minutes to the distinguished 
gentleman from New York (Mr. Gilman).
  Mr. GILMAN. Mr. Speaker, I am pleased today to rise in strong support 
of H.R. 4040, the Long-Term Care Security Act, introduced by the 
gentleman from Florida (Mr. Scarborough). I would like to thank the 
gentleman from Florida for his attention to this important issue as 
well as recognizing another committee colleague the gentlewoman from 
Maryland (Mrs. Morella) for her extensive efforts in developing similar 
legislation on this subject and the assistance of the gentleman from 
Maryland (Mr. Cummings) in bringing this measure to the floor at this 
time.
  Finding quality long-term care options is fast becoming a major issue 
of concern for our Nation's seniors. Revolutionary advances in medicine 
over the past decade have helped to greatly expand our senior 
population as well as offering those individuals improvements in their 
quality of life. These trends will continue over the next 25 years as 
the baby boomer generation enters their retirement days and our medical 
community continues to develop new products to offset or eliminate 
problems common to our elderly population.
  This legislation takes an important first step in addressing this 
growing challenge that faces our aging population. By giving Federal 
employees the opportunity to purchase a long-term care insurance 
policy, this bill encourages those employees to make plans for their 
future medical needs while they are still young and can take advantage 
of lower premiums. Such policies will protect employees from the 
catastrophically high costs associated with long-term care provision 
which could become necessary due to accident or illness at any time.
  Accordingly, I urge our colleagues to give their full support to this 
worthy piece of legislation.
  Mr. CUMMINGS. Mr. Speaker, I yield 2 minutes to the distinguished 
gentleman from Maine (Mr. Allen), who is also a member of the 
Subcommittee on Civil Service and one who has worked very hard on this 
legislation and has constantly done everything that he can to uplift 
the lives of our Federal employees.
  Mr. ALLEN. I thank the gentleman for yielding me this time.
  Mr. Speaker, I rise in strong support of H.R. 4040, the Long-Term 
Care Security Act. The bill before us today is the product of 
bipartisan cooperation. I applaud the efforts of the gentleman from 
Florida (Mr. Scarborough) and the gentleman from Maryland (Mr. 
Cummings) in bringing it to the floor today.
  As the baby boom generation ages, the need for long-term care will 
become acute. For example, the average cost of nursing home care is 
expected to double in the next 30 years. We cannot expect Medicare or 
Medicaid to absorb such costs and still pay reasonable benefits for 
acute care needs. It is therefore essential that individuals begin to 
plan for an almost certain increase in health care costs in their later 
years.
  To plan for their retirement needs, younger employees need 
information about long-term care insurance and access to private sector 
insurance plans through their employers. The private sector must be 
involved in planning for employees' long-term care needs.
  H.R. 4040 allows the Federal Government to act as a responsible 
employer by offering its employees the opportunity to acquire group 
long-term care insurance with no significant cost to the taxpayer. 
Under the provisions in this bill, long-term care insurance will be 
made available to all Federal workers, military service members and 
retirees at group rates. Employees will pay the full cost of the 
premium but have the advantage of a reduced rate. I hope that the 
example set by the Federal Government will encourage all employers to 
offer group long-term care insurance to their employees. This program 
has the potential to create a national model for long-term care 
insurance and for retirement planning.
  I again want to thank the gentleman from Florida (Mr. Scarborough), 
the gentleman from Maryland (Mr. Cummings), the gentlewoman from 
Maryland (Mrs. Morella), the gentleman from Indiana (Mr. Burton) and 
the gentleman from California (Mr. Waxman) for all their hard work in 
bringing this legislation forward. H.R. 4040 is an example of the kind 
of work this House can do when we act in a fair and bipartisan manner. 
I thank them for their leadership and urge the swift passage of this 
bill.
  Mr. CUMMINGS. Mr. Speaker, I yield 3 minutes to the distinguished 
gentleman from Maryland (Mr. Hoyer). He has certainly been a mentor to 
me, particularly with regard to the issues affecting Federal employees 
and has consistently been at the forefront of the fight to make sure 
that their rights and privileges are upheld and expanded.
  Mr. HOYER. Mr. Speaker, I want to thank my friend the distinguished 
ranking member from Baltimore for his remarks. I also want to thank him 
for his outstanding service on this subcommittee. He brings a 
perspective that is critical to the subcommittee and his leadership I 
think will redound to the benefit of Federal employees for years to 
come. I thank him for all his work and leadership.
  I also want to thank the gentleman from Florida. The gentleman from 
Florida brings, in my opinion, a new perspective to the chairmanship of 
this subcommittee, a perspective that is a positive one and I too think 
that that will also redound to the benefit of Federal employees. And so 
I thank him for his leadership and service on this committee.

                              {time}  1230

  Mr. Speaker, this measure before us would allow activity and retired 
Federal employees, military personnel and their spouses to purchase 
long-term care insurance as a group.
  I do not see her here on the floor, but I wanted to make some 
comments as well about my colleague, the gentlewoman from Maryland 
(Mrs. Morella).

[[Page H2674]]

 She has played a critical role in the formulation of this particular 
piece of legislation that is important to Federal employees and she has 
an appreciation for the long-term care costs and the challenges that 
families face. I want to congratulate her for her efforts.
  The advantages of pooling, Mr. Speaker, incorporated in this bill for 
the Federal workforce is significant. The Office of Personnel 
Management estimates that using the leverage of a risk pool this size 
could drive down the costs of insurance as much as 15 percent to 20 
percent. My colleagues often hear me say that it is incumbent on the 
Federal Government to be a model employer, whether it be in pay, 
benefits or diversity, I think that it is critical that the Federal 
Government be a standard for other employers to emulate.
  Mr. Speaker, hopefully, other employers will follow our lead in this 
legislation and start providing this benefit because it makes such a 
difference and is such an important area.
  In the Washington metropolitan area, Mr. Speaker, the costs of long-
term care can exceed $50,000 per year, average at least $3,000 to 
$3,500 a year, well beyond the means of almost every family; I do not 
mean poor families, almost every family will find this cost too much 
for them.
  This bill gives families some measure of security, and I urge all of 
my colleagues to support it.
  Mr. Speaker, once again, I thank the gentleman from Florida (Mr. 
Scarborough), the gentleman from Maryland (Mr. Cummings), the 
gentlewoman from Maryland (Mrs. Morella), and others who have worked so 
hard to bring this matter to the floor.
  Mr. Speaker, I thank my distinguished friend for yielding me the 
time.
  Mr. SCARBOROUGH. Mr. Speaker, I thank the gentleman from Maryland for 
his kind words and his hard work for Federal employees.
  Mr. Speaker, I do not have any more speakers. I will defer to the 
gentleman from Maryland (Mr. Cummings).
  Mr. CUMMINGS. Mr. Speaker, may I inquire as to how much time we have?
  The SPEAKER pro tempore (Mr. LaTourette). The gentleman from Maryland 
(Mr. Cummings) has 1 minute.
  Mr. CUMMINGS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I just wanted to take a moment to, again, emphasize that 
sometimes I think we need to take a look at what we do and put it in 
some historical perspective, and it is no question that what we are 
doing here today will affect Federal employees and their families for 
years to come and will affect generations actually yet unborn, because 
it will allow those Federal employees who have parents where they are 
now trying to help their parents and help their children to be able to 
afford to help their parents and take good care of their children.
  It does have some real long-term effect, but the fact is, as the 
gentleman from Maryland (Mr. Hoyer), who said it best when he said that 
it is truly a bipartisan effort, all of us coming together, addressing 
the things that we have in common, and what we have in common is 
lifting our people and making their lives better.
  Mr. Speaker, again, I want to thank the gentleman from Florida (Mr. 
Scarborough), thank all of the staff. I want to thank Ms. Tania Shand 
on behalf of my staff who has worked very, very hard on bringing this 
legislation to us today.
  Mr. Speaker, with that, I urge all the Members of the House to 
support this legislation.
  Mr. Speaker, I yield back the balance of my time.
  Mr. SCARBOROUGH. Mr. Speaker, how much time do I have?
  The SPEAKER pro tempore. The gentleman from Florida has 7\1/2\ 
minutes remaining.
  Mr. SCARBOROUGH. Mr. Speaker, I yield 2 minutes to the gentleman from 
Maine (Mr. Baldacci), as long as he is not the only Member to come to 
the floor in opposition of this wonderful bill.
  Mr. BALDACCI. Mr. Speaker, I thank the gentleman from Florida (Mr. 
Scarborough) for yielding me the 2 minutes.
  Mr. Speaker, I want to compliment the gentleman for his hard work and 
that of the subcommittee and the ranking member, the gentleman from 
Maryland (Mr. Cummings), because this legislation is very important to 
retirees, but I also think it is very important to everybody else, 
because the plan with this was to get this going among retirees, 
Federal retirees, but also to be able to demonstrate and educate and 
offer information to the general public at large so that we could begin 
to expand this program.
  Mr. Speaker, we look at this as a beginning, a good beginning, and I 
compliment the gentleman from Florida (Mr. Scarborough) and his staff 
and the minority Members and the ranking member, the gentleman from 
Maryland (Mr. Cummings) and his staff for doing a terrific job in 
working on this.
  Mr. Speaker, I appreciate being able to work on it with the gentleman 
and to be able to bring this piece of legislation, which I encourage 
all Members to support.
  I strongly support the hard work and legislative effort of the 
chairman of the subcommittee, the gentleman from Florida (Mr. 
Scarborough).
  Mr. SCARBOROUGH. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, I want to thank the gentleman from Maine (Mr. Baldacci) 
for his kind words. And, again, I thank the gentleman from Maryland 
(Mr. Cummings) and all of those that have worked together to make 
passage of this bill possible.
  Mr. Speaker, under our current health care system, access to long-
term care services in the home and communities is influenced not just 
by one's health status, but by their location, economic situation and 
the availability of family support.
  A recent study of American Council of Life Insurers highlighted the 
need for private long-term care insurance. The study found that baby 
boomers' chances of ending their lives in a nursing home are far higher 
than most imagined, and the costs are projected to quadruple by the 
year 2030.
  Mr. Speaker, for middle-income families, the likelihood of receiving 
government funded care at home or in an assisted living facility is 
likely to remain small.
  Federal employees who plan ahead for their long-term care needs can 
potentially postpone or avoid institutionalization. If a substantial 
number of baby boomers purchase long-term care insurance now, consumer 
out-of-pocket costs for services such as home health care and adult 
daycare can be cut in half by 2030.
  Encouraging Federal employees and others to buy private long-term 
care insurance is also a winner for taxpayers. Adequate insurance will 
allow more Americans likely to be able to live at home during their 
last years as most would prefer to do.
  With private insurance strengthening family support systems, savings 
in Medicaid nursing home expenditures could reach up to 30 percent.
  Since introducing my original bill, I have conducted a continuing 
dialogue with the minority, the industry organizations representing 
civilian and military retirees and military families and the 
administration.
  I am very pleased that all of our efforts have resulted in this 
consensus product.
  I am also pleased, Mr. Speaker, that this bill will supplement other 
steps this House has taken to bring peace of mind to many Americans by 
making their long-term care insurance more affordable.
  Already this House has passed legislation to provide an above-the-
line deduction for long-term care premiums and to allow employers to 
offer long-term care insurance through cafeteria plans. Today's bill is 
one more step in our overall effort to provide Americans with peace of 
mind about their future needs, and I urge all members to lend their 
support.
  Mr. WELDON of Florida. Mr. Speaker, as a cosponsor of H.R. 4040, I 
rise in strong support of The Long-Term Care Security Act. This bill 
directs the Office of Personnel Management (OPM) to solicit competitive 
bids from private insurers to provide long-term health care plans for 
federal workers, including military and civilian employees and 
retirees. This insurance may also be extended to include eligible 
spouses, children, adopted children, stepchildren, and stepparents.
  Employees who enroll in the group coverage must pay 100 percent of 
the premium and may choose to have the premium deducted from their pay, 
which is paid directly to

[[Page H2675]]

the insurance carrier. It is estimated, however, that these employees, 
by getting a group rate, may realize a savings of between 15 and 20 
percent on insurance premiums.
  It is important that we encourage Americans to prepare for their 
long-term health care needs. Too often Americans are unprepared for 
this need and the failure to have such coverage often forces families 
to deplete their resources. It is important that we pass this bill for 
the benefit of our federal employees and members of our armed services 
and retirees. This will help them in their efforts to provide for their 
families and their retirement security.
  In addition to the passage of this bill, I will continue to work to 
ensure that the costs of long-term care insurance are deductible from 
taxes. I am disappointed that we have not been able to get this tax 
relief signed into law, and I am hopeful that we can move this forward 
this year. This will benefit all Americans in preparing for needs that 
they may have in the future.
  I urge all of my colleagues to join me in passing H.R. 4040 and to 
commit to work to make these premiums tax deductible.
  Mr. STARK. Mr. Speaker, insurance coverage for long-term care 
services is a gaping hole in our nation's healthcare safety net. H.R. 
4040, the Long-term Care Security Act, will establish a long-term care 
insurance program for federal employees. It is a small step in the 
right direction. But, this bill is more notable for unmasking the 
shortcomings of private long-term care insurance than for meeting the 
long-term care needs of the American people.
  Americans deserve long-term care insurance that satisfies three 
criteria: reasonable cost, broad access and high quality. The main 
lesson of this bill is that the only way to achieve reasonable cost is 
to sacrifice both access and quality. We are in the dark about the 
actual provisions of the long-term care insurance plan that will 
ultimately be offered to federal employees. But the Office of Personnel 
Management's primary objective is clear to negotiate a competitive 
price. OPM has been upfront in telling us that limitations on access 
and quality of these policies will be necessary to negotiate this 
price.
  Will FEHBP's long-term care insurance program be available to all 
federal employees and their families? The answer is ``no''. One form of 
underwriting known as ``short-form'', will exclude active employees who 
are most likely to require long-term care services in the near future. 
More extensive ``long-term'' underwriting, which requires a more 
detailed medical history, will exclude larger numbers of retired 
employees and their family members.
  Will FEHBP's long-term insurance program guarantee basic consumer 
protections such as inflation protection, and provisions that guarantee 
that policies are still good in the event of carrier buyout or 
bankruptcy? Again, the answer is ``no''. Inflation protection under 
H.R. 4040 will only be available as an option. Yet, without inflation 
protection, the average 60 year old purchaser will be shopping for 
long-term care services in 2020 with year 2000 dollars! In other words, 
by design, many of the policies will not meet purchasers' needs when 
they become eligible for benefits.
  The bottom line is that high quality private long-term care insurance 
policies with universal access result in an excessively high price tag, 
while affordable long-term care insurance policies may be inferior in 
quality and not accessible to all. The real lesson of H.R. 4040 is that 
even the formidable purchasing power of the federal employees is not 
enough to turn private long-term care insurance into the answer to the 
long-term care problem.
  I will vote for H.R. 4040 today because it does inch us forward on 
long-term care products. However, private long-term care insurance 
falls far short in delivering comprehensive and high quality long-term 
care services to all who need it.
  The only way we will actually assure long-term care protections for 
people is through a national social insurance program like Medicare. 
That's where the debate needs to move next.
  Mr. DAVIS of Virginia. Mr. Speaker, I rise today to offer my strong 
support for H.R. 4040, the Long-Term Care Security Act. For the first 
time, the federal government will make a concerted effort to provide 
the men and women who have dedicated their lives to the service of this 
country, with long-term health care.
  Under this bill, the Office of Personnel Management will simply 
fulfill the role of a Human Resources department and solicit 
competitive bids from private insurers to provide the most equitable 
and comprehensive long-term health care to federal employees. That 
commitment by OPM represents the extent of the Government's active 
participation in this process. Once the contract is awarded and the 
program is established, all federal employees who chose to participate 
will be responsible for paying 100% of the insurance premiums.
  I think it is important to note that this bill has some minor 
administrative costs associated with it, I believe roughly $21 million 
over two years, that are necessary implementation costs. After that 
initial two year period, the benefits of H.R. 4040, which will be 
available to both current Uniformed Services and civilian employees, as 
well as military and civilian retirees, will actually start showing a 
profit. That makes this bill a win-win both in terms of cost and in 
services provided.
  I would like to commend my good friend from Florida, the Chairman of 
the Civil Service Subcommittee, Mr. Scarborough, for managing this bill 
on the floor today. I would also like to take a moment to thank the 
gentlelady from Maryland, Mrs. Morella. Her dedication to protecting 
and promoting issues important to federal employees is well known. 
Specifically, Mrs. Morella has long championed the cause of providing 
all federal employees and retirees with the most comprehensive and 
affordable health care available, and without her work on this issue, 
H.R. 4040 would not be on the Floor today.
  Mr. BURTON of Indiana. Mr. Speaker, I rise in support of H.R. 4040, 
the ``Long Term Care Security Act.'' The Government Reform Committee, 
in particular the Civil Service Subcommittee chaired by Congressman Joe 
Scarborough worked in a bipartisan manner to bring forward this 
legislation. The bill will allow all federal employees, retirees, 
active duty and retired members of the Uniformed Services, as well as 
their qualified relatives to purchase long term care insurance. By 
offering the program through the federal government, we can provide 
long term care options at affordable rates.
  The Civil Service Subcommittee held several hearings on long term 
care. We found that as Americans have begun to live much longer, the 
number of individuals needing long term care is on the rise. As the 
baby boomers are reaching retirement age, we will only see our elderly 
population increase. As a result, the need for long term care will 
continue to grow.
  The cost of long term care, whether in a professional facility or at 
home presently exceeds $45,000 a year. What many people do not realize 
is that their health plans, disability insurance, or even Medicare will 
not cover these costs. Unfortunately, many find out that they are not 
covered when it is too late--when a family member suddenly needs that 
care. Our Committee has heard from people who have depleted their 
entire life savings caring for a loved one. A family's assets are 
sometimes just not enough. Without the proper insurance, the vast 
majority of families is unprepared for the burden of long term care. 
Through our hearings, we found that for many, the best way to maintain 
retirement security is to purchase long term care insurance.
  I am pleased that our Committee was able to work together in a 
bipartisan manner to bring that security to our federal workforce and 
Uniformed Services. Mr. Scarborough, along with Mrs. Morella and Mr. 
Cummings, worked very hard to ensure that the long term care bill took 
into account everyone's concerns. We wanted to ensure that there would 
be open competition in the contracting process in order to achieve the 
best rates. H.R. 4040 is a strong consensus bill which the Committee 
believed would provide the framework for a strong long term care plan. 
Under the legislation, the Office of Personnel Management would be able 
to negotiate with the insurers for the best plans with the most options 
while keeping premiums affordable for all federal employees.
  Mr. SCARBOROUGH. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Florida (Mr. Scarborough) that the House suspend the 
rules and pass the bill, H.R. 4040, as amended.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

                          ____________________