Congressional Record, Volume 149 Issue 68 (Thursday, May 8, 2003)

[Congressional Record Volume 149, Number 68 (Thursday, May 8, 2003)]
[Senate]
[Pages S5951-S5973]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

By Ms. CANTWELL (for herself, Mr. Crapo, Mrs. Murry, Ms.
Murkowski, Mr. Leahy, Mrs. Clinton, and Mr. Schumer):
S. 1024. A bill to authorize the Attorney General to carry out a
program, known as the Northern Border Prosecution Initiative, to
provide funds to northern States to reimburse county and municipal
governments for costs associated with certain criminal activities, and
for other purposes; to the Committee on the Judiciary.
Ms. CANTWELL. Mr. President, today my colleagues and I introduce the
Northern Border Prosecution Reimbursement Initiative. This bill
outlines an important initiative that would give our northern border
States and counties financial assistance in prosecuting criminal and
immigration-related cases that arise because of proximity to the
border. I thank my fellow northern border Senators and cosponsors,
Senators Crapo, Murry, Murkowski, Leahy, Clinton and Schumer for
joining with me to introduce and work to pass this important
legislation.
This initiative is modeled on a successful program already in place
for southern border States. The Southern Border Prosecution Initiative
allows States and counties to apply for reimbursement of costs incurred
in any federally initiated or declined-referred criminal case. The
program is targeted at immigration-related cases, but is not limited
only to cases involving immigration charges. Cases arising out of
immigration issues but ranging from a misdemeanor property charge to a
felony drug conviction are eligible for reimbursement under the
southern border program. The program proposed in the legislation
introduced today would be operated in the same way.
Federal agencies--such as the Border Patrol and INS--have ongoing
efforts to police the Nation's borders, resulting in hundreds of
arrests each year. For many reasons, some of those cases are not
pursued by Federal law enforcement authorities and instead are handed
off to State or county officials for further prosecution. Instead of
asking States to absorb those costs--likely at the expense of other
important local law enforcement initiatives--the Northern Border
Prosecution Reimbursement Initiative allows States and counties to
receive compensation for pursuing these immigration-related cases.
The Northern Border Prosecution Reimbursement Initiative would be
administered by the Department of Justice's Bureau of Justice
Assistance. States and counties would be able to apply for
reimbursement during an annual application period, with no limit on the
number of cases submitted. Under the act, funds distribution is not
based on the size or population of a northern border State, but upon
the number of eligible cases submitted by each jurisdiction. It is
possible for reimbursement to equal 100 percent of costs, though money
is distributed on a pro rata basis if applications exceed available
revenues. Each of the 14 States along the northern border would be
eligible for the reimbursement program: Alaska, Idaho, Maine, Michigan,
Minnesota, Montana, New Hampshire, New York, North Dakota, Ohio,
Pennsylvania, Vermont, Washington and Wisconsin.
Last year, $40 million was provided to southern border States
Arizona, California, New Mexico and Texas, offsetting the costs of
prosecuting immigration-related cases. For 2002, $50 million was
allocated to the program. My legislation simply authorizes $28 million
for Fiscal Year 2004 be made available to northern border states for
the same purpose.

In the years leading up to Sept. 11, 2001, activity along the
northern border had shifted primarily from a focus on immigration
issues to those related to

[[Page S5952]]

trade and commerce. However, homeland security has grown into a
paramount concern in the wake of the 2001 terror attacks, and our
States and local governments are increasingly bearing an unfair
financial burden in protecting and patrolling our national borders.
There are hundreds of crossings along the 4,000 mile long northern
border between the United States and Canada, and though improvements
have been made to tighten security, the northern border has yet to
receive the resources it needs to adequately enforce our Nation's
immigration laws and border restrictions.
The need for greater enforcement efforts along the northern border
became glaringly evident in 1998 when Ahmed Ressam, a terrorist trained
at one of Osama bin Laden's training camps in Afghanistan, was arrested
shortly after crossing the Canadian border into Washington State.
Explosives and other bomb-making materials were found in the trunk of
Ressam's car. This frightening incident made clear the vulnerabilities
we face along the porous northern border, vulnerabilities that became
even more concerning after the Sept. 11, 2001, terror attacks.
In the last two years, the Senate has taken steps to improve northern
border security. I have worked with Senators from the 14 States that
comprise the northern border--including my colleagues who join me as
cosponsors on this legislation today--and we have successfully devoted
more resources to northern border security efforts. The 2001 Department
of Defense Appropriation's bill included $55.8 million for 500
additional Immigration and Naturalization Service inspectors along the
northern border--a 105 percent increase in staffing levels. That
legislation also provided $23.9 million to transfer 100 border patrol
agents and hire 100 new agents. Working to protect our northern border
has been a bipartisan effort, enjoying cooperation from senators across
the aisle and across the country. Now it is time to take another step
toward greater border and national security and approve the Northern
Border Prosecution Reimbursement Initiative.
The costs of homeland security are increasingly being borne by States
and local governments, an issue that this legislation tackles head-on.
Without giving States and counties the necessary resources to pay for
cases initiated by Federal authorities, other important local law
enforcement initiatives will undoubtedly be shortchanged. States and
the Federal Government must work together if our borders are to be
truly safe. The Northern Border Prosecution Reimbursement Initiative is
a mechanism by which all of the resources of the criminal justice
system--local, State, and Federal--can work in harmony.
Mr. SHELBY. Mr. President, I rise today to introduce the Older
Americans Tax Fairness Act of 2003. My bill would completely eliminate
the unjust taxation of Social Security benefits once and for all. The
underlying premise of my legislation is simple: Social Security
benefits were never intended to be taxed. At its inception and
continuing on for the next fifty years, Social Security benefits were
exempt from taxation. Budgetary shortfalls in 1984 and 1993, however,
led to the taxation of these benefits.
Because of the rising cost of living, many of our seniors are forced
to work past age 65. To these Americans, every penny counts in
determining whether they are able to pay for food, heating, and
healthcare. However, by taxing Social Security benefits, we make it
increasingly impossible for millions of older Americans to make ends
meet. In effect, then, taxation of Social Security benefits forces many
Americans to endure stressful situations in what should be the golden
years of their lives.
Taxation of Social Security benefits is also wrong because it changes
the rules in the middle of the game. When seniors contributed to Social
Security through the payment of payroll taxes, they did so with the
understanding that they would one day receive those benefits tax-free.
Unfortunately, because of runaway spending, many in the government have
viewed Social Security taxation as a way to make up the shortfall
between Federal spending and revenue. Such a decision was wrong then
and it is even more wrong now as seniors face rising living costs.
In addition to being fundamentally unfair, I believe that taxing
Social Security benefits once seniors pass certain income thresholds
discourages them from working. I firmly believe that senior citizens
add a wealth of knowledge and experience to the workplace. As such, we
must make sure that our American workforce is not deprived of these
valuable assets. Our laws should encourage older Americans with a
desire to work to continue contributing to our society. Unfortunately,
our laws do just the opposite.
Every year my office receives hundreds of letters and calls from
older Americans throughout the country and Alabama describing the
hardship that Social Security taxation has placed on their lives. The
solution to this situation is simple--repeal the unfair taxation of
these benefits. I therefore urge my colleagues to listen to their
constituents and join me in support of my bill.
______

By Mr. ENSIGN:
S. 1029. A bill to enhance peace between the Israelis and
Palestinians; to the Committee on Foreign Relations.
Mr. ENSIGN. Mr. President, I ask unanimous consent that the text of
this bill be printed in the Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:

S. 1029

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

SEC. 1. SHORT TITLE.

This title may be cited as the ``Israeli-Palestinian Peace
Enhancement Act of 2003''.

SEC. 2. FINDINGS.

Congress makes the following findings:
(1) The security of the State of Israel is a major and
enduring national security interest of the United States.
(2) A lasting peace in the Middle East region can only take
root in an atmosphere free of violence and terrorism.
(3) The Palestinian people have been ill-served by leaders
who, by resorting to violence and terrorism to pursue their
political objectives, have brought economic and personal
hardship to their people and brought a halt to efforts
seeking a negotiated settlement of the conflict.
(4) The United States has an interest in a Middle East in
which two states, Israel and Palestine, will live side by
side in peace and security.
(5) In his speech of June 24, 2002, and in other
statements, President George W. Bush outlined a comprehensive
vision of the possibilities of peace in the Middle East
region following a change in Palestinian leadership.
(6) The Palestinian state must be a reformed, peaceful, and
democratic state that abandons forever the use of terror.
(7) On April 29, 2003, the Palestinian Legislative Council
confirmed in office, by a vote of 51 yeas, 18 nays, and 3
abstentions, the Palestinian Authority's first prime
minister, Mahmoud Abbas (Abu Mazen), and his cabinet.
(8) In his remarks prior to the vote of the Palestinian
Legislative Council, Mr. Abbas declared: ``The government
will concentrate on the question of security . . . The
unauthorized possession of weapons, with its direct threat to
the security of the population, is a major concern that will
be relentlessly addressed . . . There will be no other
decision-making authority except for the Palestinian
Authority.''.
(9) In those remarks, Mr. Abbas further stated: ``We
denounce terrorism by any party and in all its forms both
because of our religious and moral traditions and because we
are convinced that such methods do not lend support to a just
cause like ours but rather destroy it.''.
(10) Israel has repeatedly indicated its willingness to
make painful concessions to achieve peace once there is a
partner for peace on the Palestinian side.

SEC. 3. PURPOSES.

The purposes of this title are--
(1) to express the sense of Congress with respect to United
States recognition of a Palestinian state; and
(2) to demonstrate United States willingness to provide
substantial economic and humanitarian assistance, and to
support large-scale multilateral assistance, after the
Palestinians have achieved the reforms outlined by President
Bush and have achieved peace with the State of Israel.

SEC. 4. SENSE OF CONGRESS.

It is the sense of Congress that--
(1) peace between Israel and the Palestinians cannot be
negotiated until the Palestinian system of government has
been transformed along the lines outlined in President Bush's
June 24, 2002, speech;
(2) substantial United States and international economic
assistance will be needed after the Palestinians have
achieved the reforms described in section 620K(c)(2) of the
Foreign Assistance Act of 1961 (as added by section 1506 of
this Act) and have made a lasting and secure peace with
Israel;
(3) the Palestinian people merit commendation on the
confirmation of the Palestinian Authority's first prime
minister, Mahmoud Abbas (Abu Mazen), and his cabinet;

[[Page S5953]]

(4) the new Palestinian administration urgently should take
the necessary security-related steps to allow for
implementation of a performance-based road map to resolve the
Israeli-Palestinian conflict;
(5) the United States Administration should work vigorously
toward the goal of two states living side-by-side in peace
within secure and internationally-recognized boundaries free
from threats or acts of force; and
(6) the United States has a vital national security
interest in a permanent, comprehensive, and just resolution
of the Arab-Israeli conflict, and particularly the
Palestinian-Israeli conflict, based on the terms of United
Nations Security Council Resolutions 242 and 338.

SEC. 5. RECOGNITION OF A PALESTINIAN STATE.

It is the sense of Congress that a Palestinian state
should not be recognized by the United States until the
President determines that--
(1) a new leadership of a Palestinian governing entity, not
compromised by terrorism, has been elected and taken office;
and
(2) the newly-elected Palestinian governing entity--
(A) has demonstrated a firm and tangible commitment to
peaceful coexistence with the State of Israel and to ending
anti-Israel incitement, including the cessation of all
officially sanctioned or funded anti-Israel incitement;
(B) has taken appropriate measures to counter terrorism and
terrorist financing in the West Bank and Gaza, including the
dismantling of terrorist infrastructures and the confiscation
of unlawful weaponry;
(C) has established a new Palestinian security entity that
is fully cooperating with the appropriate Israeli security
organizations;
(D) has achieved exclusive authority and responsibility for
governing the national affairs of a Palestinian state, has
taken effective steps to ensure democracy, the rule of law,
and an independent judiciary, and has adopted other reforms
ensuring transparent and accountable governance; and
(E) has taken effective steps to ensure that its education
system promotes the acceptance of Israel's existence and of
peace with Israel and actively discourages anti-Israel
incitement.

SEC. 6. LIMITATION ON ASSISTANCE TO A PALESTINIAN STATE.

Chapter 1 of part III of the Foreign Assistance Act of 1961
(22 U.S.C. 2351 et seq.) is amended--
(1) by redesignating the second section 620G (as added by
section 149 of Public Law 104-164 (110 Stat. 1436)) as
section 620J; and
(2) by adding at the end the following new section:

``SEC. 620K. LIMITATION ON ASSISTANCE TO A PALESTINIAN STATE.

``(a) Limitation.--
``(1) In general.--Notwithstanding any other provision of
law, assistance may be provided under this Act or any other
provision of law to the government of a Palestinian state
only during a period for which a certification described in
subsection (c) is in effect. The limitation contained in the
preceding sentence shall not apply (A) to humanitarian or
development assistance that is provided through
nongovernmental organizations for the benefit of the
Palestinian people in the West Bank and Gaza, or (B) to
assistance that is intended to reform the Palestinian
Authority and affiliated institutions, or a newly elected
Palestinian governing entity, in order to help meet the
requirements contained in subparagraphs (A) through (H) of
subsection (c)(2) or to address the matters described in
subparagraphs (A) through (E) of section 1505(2) of the
Israeli-Palestinian Peace Enhancement Act of 2003.
``(2) Waiver.--The President may waive the limitation of
the first sentence of paragraph (1) if the President
determines and certifies to the Committee on International
Relations of the House of Representatives and the Committee
on Foreign Relations of the Senate that it is vital to the
national interest of the United States to do so.
``(b) Congressional Notification.--
``(1) In general.--Assistance made available under this Act
or any other provision of law to a Palestinian state may not
be provided until 15 days after the date on which the
President has provided notice thereof to the Committee on
International Relations and the Committee on Appropriations
of the House of Representatives and to the Committee on
Foreign Relations and the Committee on Appropriations of the
Senate in accordance with the procedures applicable to
reprogramming notifications under section 634A(a) of this
Act.
``(2) Sunset.--Paragraph (1) shall cease to be effective
beginning ten years after the date on which notice is first
provided under such paragraph.
``(c) Certification.--A certification described in this
subsection is a certification transmitted by the President to
Congress that--
``(1) a binding international peace agreement exists
between Israel and the Palestinians that--
``(A) was freely signed by both parties;
``(B) guarantees both parties' commitment to a border
between two states that constitutes a secure and
internationally recognized boundary for both states, with no
remaining territorial claims;
``(C) provides a permanent resolution for both Palestinian
refugees and Jewish refugees from Arab countries; and
``(D) includes a renunciation of all remaining Palestinian
claims against Israel through provisions that commit both
sides to the ``end of the conflict''; and
``(2) the new Palestinian government--
``(A) has been democratically elected through free and fair
elections, has exclusive authority and responsibility for
governing the national affairs of the Palestinian state, and
has achieved the reforms outlined by President Bush in his
June 24, 2002, speech;
``(B) has completely renounced the use of violence against
the State of Israel and its citizens, is vigorously
attempting to prevent any acts of terrorism against Israel
and its citizens, and punishes the perpetrators of such acts
in a manner commensurate with their actions;
``(C) has dismantled, and terminated the funding of, any
group within its territory that conducts terrorism against
Israel;
``(D) is engaging in ongoing and extensive security
cooperation with the State of Israel;
``(E) refrains from any officially sanctioned or funded
statement or act designed to incite Palestinians or others
against the State of Israel and its citizens;
``(F) has an elected leadership not compromised by terror;
``(G) is demilitarized; and
``(H) has no alliances or agreements that pose a threat to
the security of the State of Israel.
``(d) Recertifications.--Not later than 90 days after the
date on which the President transmits to Congress an initial
certification under subsection (c), and every 6 months
thereafter for the 10-year period beginning on the date of
transmittal of such certification--
``(1) the President shall transmit to Congress a
recertification that the requirements contained in subsection
(c) are continuing to be met; or
``(2) if the President is unable to make such a
recertification, the President shall transmit to Congress a
report that contains the reasons therefor.
``(e) Rule of Construction.--A certification under
subsection (c) shall be deemed to be in effect beginning on
the day after the last day of the 10-year period described in
subsection (d) unless the President subsequently determines
that the requirements contained in subsection (c) are no
longer being met and the President transmits to Congress a
report that contains the reasons therefor.''.

SEC. 7. AUTHORIZATION OF ASSISTANCE TO A PALESTINIAN STATE.

Chapter 1 of part III of the Foreign Assistance Act of 1961
(22 U.S.C. 2351 et seq.), as amended by section 1506, is
further amended by adding at the end the following new
section:

``SEC. 620L. AUTHORIZATION OF ASSISTANCE TO A PALESTINIAN
STATE.

``(a) Assistance.--The President is authorized to provide
assistance to a Palestinian state in accordance with the
requirements of this section.
``(b) Activities To Be Supported.--Assistance provided
under subsection (a) shall be used to support activities
within a Palestinian state to substantially improve the
economy and living conditions of the Palestinians by, among
other things, providing for economic development in the West
Bank and Gaza, continuing to promote democracy and the rule
of law, developing water resources, assisting in security
cooperation between Israelis and Palestinians, and helping
with the compensation and rehabilitation of Palestinian
refugees.
``(c) Authorization of Appropriations.--Of the amounts made
available to carry out chapter 4 of part II of this Act for a
fiscal year, there are authorized to be appropriated to the
President to carry out subsections (a) and (b) such sums as
may be necessary for each such fiscal year.
``(d) Coordination of International Assistance.--
``(1) In general.--Beginning on the date on which the
President transmits to Congress an initial certification
under section 620K(c), the Secretary of State shall seek to
convene one or more donors conferences to gain commitments
from other countries, multilateral institutions, and
nongovernmental organizations to provide economic assistance
to Palestinians to ensure that such commitments to provide
assistance are honored in a timely manner, to ensure that
there is coordination of assistance among the United States
and such other countries, multilateral institutions, and
nongovernmental organizations, to ensure that the assistance
provided to Palestinians is used for the purposes for which
is was provided, and to ensure that other countries,
multilateral institutions, and nongovernmental organizations
do not provide assistance to Palestinians through entities
that are designated as terrorist organizations under United
States law.
``(2) Report.--Not later than 180 days after the date of
the enactment of this section, and on an annual basis
thereafter, the Secretary of State shall prepare and submit
to the Committee on International Relations and the Committee
on Appropriations of the House of Representatives and the
Committee on Foreign Relations and the Committee on
Appropriations of the Senate a report that describes the
activities undertaken to meet the requirements of paragraph
(1), including a description of amounts committed, and the
amounts provided, to a Palestinian state or Palestinians
during the reporting period by each country and
organization.''.
______

By Mr. BINGAMAN:
S. 1030. A bill to expand the number of individuals and families with
health

[[Page S5954]]

insurance coverage, and for other purposes; to the Committee on
Finance.
Mr. BINGAMAN. Mr. President, yesterday, I introduced the first part
of a series of proposals to protect and strengthen our nation's health
care safety net. That bill, the ``Strengthening Our States'' or SOS Act
of 2003,'' seeks to protect and improve the Medicaid program--a
critical component of our country's health system. To repeat the words
of Diane Rowland and Jim Tallon of the Kaiser Commission on Medicaid
and the Uninsured, ``Medicaid is the glue that helps hold our health
system together and takes on the highest-risk, sickest, and most
expensive populations from private insurance and Medicare.
Like a waterfront community that seeks to set up barricades against a
rising river, defending the Medicaid program from attacks, such as the
idea of a block grant, is a top priority.
However, once that is assured, we must also take the next step and
confront the fact that an estimated 41.2 million people, or almost 15
percent of the population, was without health insurance during the
entire year of 2001, which was an increase of 1.4 million people over
2000.
Moreover, the numbers in 2002 and this year have undoubtedly
worsened. A report by the National Coalition on Health Care says, ``The
confluence of powerful economic forces, fueled by the terrorist attacks
on September 11, have unleashed a `perfect storm' that could increase
dramatically the number of uninsured in the U.S.--with as many as 6
million people in total losing their coverage in 2001 and 2002.''
The number in New Mexico are staggering. New Mexico leads or ranks
second only to Texas in the percentage of its citizens who are
uninsured. In fact, New Mexico is the only state in the country with
less than half of its population having private health insurance
coverage.
A rather shocking statistic, which also continues to worsen, is that
one out of every three Hispanic citizens are uninsured. In fact, less
than 43 percent of the Hispanic population now has employer-based
coverage nationwide, which is in sharp comparison to the 68 percent of
non-Hispanic whites who have employer-based coverage.
To address this growing crisis, I have worked closely with the
American College of Physicians since last fall on the legislative
proposal, which I call the ``Health Coverage, Affordability,
Responsibility, and Equity Act'' or the ``HealthCARE Act of 2003.'' The
proposal seeks to: First, build upon programs that currently work,
including Medicaid, employer coverage, and the private market; second,
provide choices for uninsured individuals, states, and small businesses
while rejecting either employer or individual mandates; third, use
methods that have bipartisan support by borrowing the best ideas from
Democratic and Republican proposals; and, fourth, simplify rather than
complicate coverage.

This is in sharp contrast, in a number of ways, to past efforts to
create untried schemes or to impose mandates upon either businesses or
the individual. It also seeks to bridge the divide between Democrats
and Republicans. This has certainly not been easy to put together and
nor will it be easy to pass. On the other hand, we have tried to start
with the tools and principles more likely to get beyond the partisan
divide.
As Julie Rovner of the National Journal recently wrote, ``If
reforming the nation's healthcare system was easy, the old saw goes, it
would have been done long ago. But for the moment, those who care about
the issue seem to be succeeding only in butting each other's heads.
Republicans keep pushing market-oriented reforms while Democrats want
to expand existing public programs. And each party continues to reject
the other's ideas. . . .''
The ``Health CARE Act'' seeks to break that partisan gridlock. First,
it adopts and builds upon the notion of many Republicans to offer tax
credits for the uninsured. As such, the bill would enact a new health
insurance tax credit that is both refundable and advanceable to
uninsured Americans with incomes up to 200 percent of the poverty level
to purchase health coverage through a variety of options, including
employer-coverage, State purchasing pools, or even the individual
market--something pushed by a number of Republicans for many years but
rejected by many Democrats.
Second, the legislation expands coverage through a State option with
Federal financial support through the Medicaid program to anyone up to
100 percent of the poverty level. Medicaid has been a tried and tested
program for low-income Americans over the years and is a far better and
more viable option to people with incomes below the poverty level than
a tax credit would be. Furthermore, few beneath the poverty level have
the option of employer-coverage. Therefore, public programs, such as
Medicaid, for low-income Americans makes far more sense than a tax
credit.
Furthermore, through the strengthened and improved state purchasing
pools provided for in the legislation, individuals and small businesses
would be afforded better options to get coverage with a choice of plans
that is typically not available to them with, what we believe will be,
lower costs due to the ability to purchase coverage as a group.
Consequently, this approach attempts to build upon the ideas of both
political parties, as it has both public program and tax credit aspects
to it. Our hope is that people will see the things both parties like in
it rather than focusing on what they do not like. In fact, we have also
added the creation of an on-going expert health commission to make
recommendations for further reforms and mid-course corrections in the
future.
This bill is introduced in the spirit of compromise. To those on the
right, I recognize your concern about the expansion of Medicaid as not
being as market-oriented as you might prefer, but would point out that
tax credits are virtually unworkable and employer-sponsored coverage
often unavailable for people below the poverty level and that Medicaid
is largely contracted out to private health plans--the same that many
of you are enrolled in.
To those on the left, I recognize your concerns about tax credits and
the potential for adverse selection with people buying coverage through
the individual market, but I say to you that these are tax credits for
low-income people and that we have taken steps in the legislation to
mitigate problems that the added options in the bill create with
respect to adverse selection. I would add that any expansion of
coverage to people without health insurance is a good thing.
The most important message that I hope this bill carries is that we
must stop having the perfect be the enemy of the good. This proposal is
certainly not perfect but we hope it makes a very good start.
I would like to thank the American College of Physicians, or ACP, for
their outstanding leadership and help in putting this legislation
together. ACP has been a long-standing advocate for expanding health
coverage and has authored landmark reports on the important role that
health insurance has in reducing people's morbidity and mortality. In
fact, to cite the conclusion of one of those studies, ``Lack of
insurance contributes to the endangerment of the health of each
uninsured American as well as the collective health of the nation.''
I would also like to thank the many people at the Economic and Social
Research Institute, or ERSI, on their forethought, advice, and counsel
as we refined the proposal over the past number of months. Their non-
partisan approach and expertise have been invaluable to making the bill
a workable and well-reasoned reality.
It should also be noted that the ideas put forth in the bill are
based upon much of the expert work commissioned by ESRI, funded by the
Robert Wood Johnson Foundation, and the Task Force on the Future of
Health Insurance, funded by the Commonwealth Fund. As a result, the
work of a number of other experts is reflected in the legislation and
we thank you as well.
Among the endorsing organizations for this legislation are all of the
leading primary care physician groups in our country. In addition to
the American College of Physicians, the bill has been endorsed by the
American Academy of Family Physicians, the American Academy of
Pediatrics, and the American Geriatrics Society.
As a practicing physician in New Mexico, Dr. Robert Strickland sums
it up well. As he wrote in an editorial

[[Page S5955]]

published in the Albuquerque Journal about this legislation yesterday,
``As a New Mexico internist for 31 years, I have seen many uninsured
people go without care until it is too late for me to do much to help
them. The HealthCARE Act offers the potential of breaking the political
gridlock that has allowed this crisis in health care to go on for far
too long.''
I hope we can break the gridlock and urge my colleagues to heed the
call of our nation's primary care doctors to support this legislation.
I would ask unanimous consent that letters of endorsement from the
American College of Physicians, the American Academy of Family
Physicians, the American Academy of Pediatrics, the American Geriatrics
Society, and Families USA, and the text of the legislation printed in
the Record.
There being no ojection, the material was ordered to be printed in
the Record, as follows:

American College of Physicians,

Washington, DC, May 8, 2003.
Hon. Jeff Bingaman,
U.S. Senate, 703 Senate Hart Office Building, Washington, DC.
Dear Senator Bingaman: on behalf of the American College of
Physicians (ACP), I am pleased to express our strong support
for the Health Coverage, Affordability, Responsibility and
Equity Act of 2003 (HealthCARE Act of 2003). ACP is the
largest medical specialty society in the United States,
representing 115,000 doctors of internal medicine and medical
students.
We very much appreciate the opportunity you have given us
to translate many of the ideas in ACP's proposal to provide
health insurance coverage to all Americans by the end of the
decade into the HealthCARE Act of 2003. Specifically:
States will be given new options to extend health insurance
coverage to low-income working Americans, without imposing
unfunded mandates on financially strapped state treasuries.
Advance, refundable tax credits will be made available to
uninsured working Americans with incomes up to 200 percent of
the federal poverty level.
The tax credit will provide a premium subsidy equal to what
the Federal Government now provides to its own employees.
Tax credit recipients will have the options of buying
coverage through state purchase group arrangements modeled
after the Federal Employees Health Benefits Program, giving
them the same types and variety of health plan options now
available only to federal employees, or from qualified non-
group insurers.
Small employers will have new options for obtaining
coverage, including having access to the variety and types of
health plans offered to federal employees.
An expert advisory commission will recommend essential
benefits that participating health plans will be encouraged
to offer, as well as ways to expand coverage to those with
incomes above 200 percent of the federal poverty level.
ACP is confident that this framework can succeed where
other health reform proposals have failed. By offering
incentives and choices to states, employers, and consumers,
instead of ``one-size-fits-all'' government mandates, the
HealthCARE Act has the potential of unifying, instead of
dividing, key stakeholders.
The American College of Physicians commends you for your
leadership in introducing the HealthCARE Act of 2003, and we
look forward to working with you and lawmakers from both
political parties in getting the bill enacted into law.
Sincerely,
Munsey S. Wheby, MD, FACP,
President.
____

May 5, 2003.
The Hon. Jeff Bingaman,
U.S. Senate,
Washington, DC.
Dear Senator Bingaman: On behalf of the 94,300 members of
the American Academy of Family Physicians, I commend you for
your outstanding leadership in the effort to assure access to
health care for the uninsured in this nation. The AAFP has
reviewed your draft legislation that would change Medicaid,
SCHIP and the federal income tax code to make health coverage
more affordable to uninsured Americans. I am pleased to
inform you that the AAFP supports your bill and offers you
our assistance in seeking its passage.
Your legislative proposal is a wide-ranging measure that
would take us noticeably closer to affordable health care
coverage for all. For example, your bill would:
assist states in creating purchasing pools to provide low-
cost insurance for uninsured individuals with incomes up to
200 percent of the federal poverty level;
allow small businesses to have access to these state-
operated purchasing pools so that they can offer affordable
health insurance to their employees;
provide states with the new option to offer ``need-based''
eligibility for Medicaid beneficiaries;
remove the federal cap on non-waivered SCHIP coverage; and
offer federal income tax credits and premium subsidies for
those currently uninsured whose income is at or below 200
percent of the federal poverty level and who are ineligible
for Medicaid for SCHIP coverage or other insurance options.
These and other provisions of your proposal demonstrate
your longstanding commitment to the health of everyone in
this country and we are pleased and honored to support you in
this effort.
Sincerely,
Warren A. Jones, M.D., FAAFP,
Board Chair.
____

American Academy of Pediatrics,

Washington, DC, May 7, 2003.
Hon. Jeff Bingaman,
U.S. Senate,
Washington, DC.
Dear Senator Bingaman: On behalf of the 57,000 pediatrician
members of the American Academy of Pediatrics (AAP), I write
today in support of the Health Coverage, Affordability,
Responsibility and Equity Act of 2003.
The problem of the uninsured and underinsured is real and
growing. This legislation is an effective way to provide
greater access to comprehensive health care for more
Americans. This legislation would allow poor and near poor
families a variety of options for affordable and
comprehensive health coverage.
The Academy especially appreciates the effort to
strengthen, not undermine current public programs. Currently,
more than 9 million children are uninsured in this country
and million more are uninsured for part of the year, churning
on and off of health coverage. Seventy percent of the
uninsured children are eligible for public programs but
unenrolled. This legislation would encourage greater
enrollment of these uninsured children by providing financial
incentives to the states to enroll and retain these children,
and by allowing families to unify their health coverage.
Thank you for your leadership and commitment to our
nation's families and their access to quality health care. We
look forward to our continued work together.
Sincerely,
E. Stephen Edwards, M.D.,
President.
____

American Geriatrics Society,
New York, NY, April 22, 2003.
Hon. Jeff Bingaman
U.S. Senate,
Washington, DC.
Dear Senator Bingaman: The American Geriatrics Society
(AGS), an organization of over 6,000 geriatricians and other
health professionals who are specially trained in the
management of care for frail, chronically ill older patients,
is pleased to endorse the Health CARE Act of 2003. We commend
you for your sponsorship of this important bill, which seeks
to improve health coverage for millions of uninsured
Americans.
By simplifying and expanding coverage choices for uninsured
individuals and small businesses, your legislation represents
a balanced approach to confronting one of our nation's most
pressing problems. The consequences of having little or no
health insurance are well documented. People without coverage
are less likely to have a regular source of care, don't
receive recommended health screening services nor do they
have appropriate care management for chronic conditions. As a
result, uninsured patients often are sicker and are more
likely to die sooner than people who have health insurance.
Adults in late middle age are especially susceptible to
deteriorating health if they never had or lose their health
insurance coverage.
The Health CARE Act of 2003 would improve the health of
million of Americans expanding their access to health
insurance coverage. AGS applauds your willingness to tackle
this complex issue and looks forward to working with you to
enact this bill.
Sincerely,
Jerry Johnson, MD,
President.
____

April 28, 2003.
Hon. Jeff Bingaman,
U.S. Senate, 703 Hart Senate Office Building, Washington, DC
20510.
Dear Senator Bingaman: Congratulations on your introduction
of the HealthCARE Act of 2003. Your bill is an important
initiative that seeks to combine good health policy with the
politically achievable.
While Families USA, the national consumer health
organization, has historically supported expansions of public
programs like Medicaid and SCHIP, we recognize that different
approaches are necessary if we are to see the enactment of
major reductions in the number of uninsured. Your bill
adroitly combines (1) a federally financed expansion of
Medicaid and SCHIP to cover all those under 100 percent of
the federal poverty level with (2) a premium subsidy/tax
credit program to help those under 200 percent of poverty buy
into various health insurance plans. Further, it lays the
groundwork for an expansion of insurance to the rest of
society by the end of the decade.
It is imperative that Congress act as soon as possible to
help the nearly one our of three non-elderly Americans who
are uninsured sometime during any two-year period. Federal
help with Medicaid is particularly urgent to counter the
massive cutbacks in coverage by the various states during the
current economic downturn. As our recent report (``Going
Without Health Insurance, Nearly One in Three Non-Elderly
Americans'') shows, the problem of the uninsured,

[[Page S5956]]

and the adverse consequences of being uninsured, are much
worse than previously reported. In your State of New Mexico,
for example, 602,000 people--38.6 percent of the population
under age 65--were uninsured sometime in 2002-2002. Of that
number, 410,000 were uninsured for more than six months.
Your bill would make a major reduction in these
unacceptable numbers. It would greatly improve the quality of
health and security in America, and we look forward to
working with you towards its enactment.
Sincerely,
Ronald F. Pollack,
Executive Director.

S. 1030

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) Short Title.--This Act may be cited as the ``Health
Coverage, Affordability, Responsibility, and Equity Act of
2003''or the ``HealthCARE Act of 2003''.
(b) Table of Contents.--The table of contents of this Act
is as follows:

Sec. 1. Short title; table of contents.

TITLE I--INCREASING HEALTH CARE COVERAGE

Subtitle A--Medicaid and SCHIP

Sec. 101. State option to offer medicaid coverage based on need.
Sec. 102. State option to provide coverage of children under SCHIP in
excess of the State's allotment.

Subtitle B--Refundable Tax Credit for Health Insurance Costs of Low-
Income Individuals and Families

Sec. 111. Credit for health insurance costs of certain low-income
individuals.
Sec. 112. Advance payment of credit for health insurance costs of
eligible low-income individuals.

TITLE II--IMPROVING ACCESS TO HEALTH PLANS

Sec. 201. Definitions.
Sec. 202. Establishment of health insurance purchasing pools.
Sec. 203. Purchasing pools.
Sec. 204. Purchasing pool operators.
Sec. 205. Contracts with participating insurers.
Sec. 206. Options for health benefits coverage.
Sec. 207. Enrollment process for eligible individuals.
Sec. 208. Plan premiums.
Sec. 209. Enrollee premium share.
Sec. 210. Payments to purchasing pool operators and payments to
participating insurers.
Sec. 211. State-based reinsurance programs.
Sec. 212. Coverage under individual health insurance.
Sec. 213. Use of premium subsidies to unify family coverage with
members enrolled in medicaid and SCHIP.
Sec. 214. Coverage through employer-sponsored health insurance.
Sec. 215. Participation by small employers.
Sec. 216. Report.
Sec. 217. Authorization of appropriations.

TITLE III--NATIONAL ADVISORY COMMISSION ON EXPANDED ACCESS TO HEALTH
CARE

Sec. 301. National Advisory Commission on Expanded Access to Health
Care.
Sec. 302. Congressional action.

TITLE IV--STATE WAIVERS

Sec. 401. State waivers.

TITLE I--INCREASING HEALTH CARE COVERAGE

Subtitle A--Medicaid and SCHIP

SEC. 101. STATE OPTION TO OFFER MEDICAID COVERAGE BASED ON
NEED.

(a) State Option.--Section 1902(a)(10)(A)(ii) of the Social
Security Act (42 U.S.C. 1396a) is amended--
(1) by striking ``or'' at the end of subclause (XVII);
(2) by adding ``or'' at the end of subclause (XVIII); and
(3) by adding at the end the following:

``(XIX) who are not otherwise eligible for medical
assistance under this title and whose income does not exceed
such income level as the State may establish, expressed as a
percentage (not to exceed 100) of the income official poverty
line (as defined by the Office of Management and Budget, and
revised annually in accordance with section 673(2) of the
Omnibus Budget Reconciliation Act of 1981) applicable to a
family of the size involved;''.

(b) Increased FMAP.--Section 1905 of the Social Security
Act (42 U.S.C. 1396d) is amended--
(1) in the first sentence of subsection (b)--
(A) by striking ``and (4)'' and inserting ``(4)''; and
(B) by inserting before the period the following: ``, and
(5) in the case of a State that meets the conditions
described in paragraph (1) of subsection (x), the Federal
medical assistance percentage shall be equal to the need-
based enhanced FMAP described in paragraph (2) of subsection
(x)''; and
(2) by adding at the end the following:
``(x)(1) For purposes of clause (5) of the first sentence
of subsection (b), the conditions described in this
subsection are the following:
``(A) The State provides medical assistance to individuals
described in subsection (a)(10)(A)(ii)(XIX).
``(B) The State uses streamlined enrollment and outreach
measures to all individuals described in subparagraph (A)
including--
``(i) the same application and retention procedures (such
as 1-page enrollment forms and enrollment by mail) used by
the majority of State programs under title XXI during the
preceding year; and
``(ii) outreach efforts proportional in scope and
reasonably expected effectiveness to those employed by the
State during a comparable stage of implementation of the
State's program under title XXI.
``(C) The State applies eligibility standards and
methodologies under this title with respect to individuals
residing in the State who have not attained age 65 that are
not more restrictive (as determined under section
1902(a)(10)(C)(i)(III)) than the standards and methodologies
that applied under this title with respect to such
individuals as of July 1, 2003.
``(2)(A) For purposes of clause (5) of the first sentence
of subsection (b), the need-based enhanced FMAP for a State
for a fiscal year, is equal to the Federal medical assistance
percentage (as defined in the first sentence of subsection
(b)) for the State increased, subject to subparagraph (B), by
such percentage increase as would compensate all States for
the additional expenditures that would be incurred by all
States if the States were to provide medical assistance to
all individuals whose income does not exceed 100 percent of
the income official poverty line (as defined by the Office of
Management and Budget, and revised annually in accordance
with section 673(2) of the Omnibus Budget Reconciliation Act
of 1981) applicable to a family of the size involved and who
are eligible for such assistance only on the basis of section
1902(a)(10)(A)(ii)(XIX).
``(B) In the case of a State that provides medical
assistance to individuals described in section
1902(a)(10)(A)(ii)(XIX) but limits such assistance to
individuals with income at or below a percentage of the
income official poverty line (as defined by the Office of
Management and Budget, and revised annually in accordance
with section 673(2) of the Omnibus Budget Reconciliation Act
of 1981) applicable to a family of the size involved that is
less than 100, the Secretary shall reduce the need-based
enhanced FMAP otherwise determined for the State under
subparagraph (A) by a proportion based on the national income
distribution of all individuals in all States who are
(regardless of whether such individuals are enrolled under
this title) eligible for medical assistance only on the basis
of section 1902(a)(10)(A)(ii)(XIX).''.
(c) Conforming Amendments.--Section 1905(a) of the Social
Security Act (42 U.S.C. 1396d(a)) is amended in the matter
preceding paragraph (1)--
(1) by striking ``or'' at the end of clause (xii);
(2) by adding ``or'' at the end of clause (xiii); and
(3) by inserting after clause (xiii) the following:
``(xiv) individuals who are eligible for medical assistance
on the basis of section 1902(a)(10)(A)(ii)(XIX);''.
(d) Effective Date.--The amendments made by this section
take effect on October 1, 2004, and apply to medical
assistance provided on or after that date, without regard to
whether final regulations to carry out such amendments have
been promulgated by such date.

SEC. 102. STATE OPTION TO PROVIDE COVERAGE OF CHILDREN UNDER
SCHIP IN EXCESS OF THE STATE'S ALLOTMENT.

(a) In General.--Title XXI of the Social Security Act (42
U.S.C. 1397aa et seq.) is amended by adding at the end the
following:

``SEC. 2111. STATE OPTION TO PROVIDE COVERAGE OF CHILDREN IN
EXCESS OF THE STATE'S ALLOTMENT.

``(a) State Option.--In the case of a State that meets the
condition described in subsection (b), the following shall
apply:
``(1) Notwithstanding section 2105 and without regard to
the State's allotment under section 2104, the Secretary shall
pay the State an amount for each quarter equal to the
enhanced FMAP of expenditures incurred in the quarter that
are described in section 2105(a)(1).
``(2) The Secretary shall reduce the State's allotment
under section 2104, for the first fiscal year for which the
State amendment described in subsection (b) applies, and for
each fiscal year thereafter, by an amount equal to the amount
that the Secretary determines the State would have expended
to provide child health assistance to targeted low-income
children during that fiscal year if that State had not
elected the State option to provide such assistance in
accordance with this section.
``(3) Subsections (f) and (g) of section 2104 shall not
apply to the State's reduced allotment (after the application
of paragraph (2)).
``(b) Condition Described.--For purposes of subsection (a),
the condition described in this subsection is that the State
has made an irrevocable election, through a plan amendment,
to provide child health assistance to all targeted low-income
children residing in the State (without regard to date of
application for assistance) and to cover health services
listed in the State plan whenever medically necessary.''.
(b) Effective Date.--The amendment made by this section
takes effect on October 1, 2004, and apply to child health
assistance provided on or after that date, without regard to
whether final regulations to carry

[[Page S5957]]

out such amendment have been promulgated by such date.

Subtitle B--Refundable Tax Credit for Health Insurance Costs of Low-
Income Individuals and Families

SEC. 111. CREDIT FOR HEALTH INSURANCE COSTS OF CERTAIN LOW-
INCOME INDIVIDUALS.

(a) In General.--Subpart C of part IV of subchapter A of
chapter 1 of the Internal Revenue Code of 1986 (relating to
refundable credits) is amended by redesignating section 36 as
section 37 and inserting after section 35 the following new
section:

``SEC. 36. HEALTH INSURANCE COSTS OF ELIGIBLE LOW-INCOME
INDIVIDUALS.

``(a) In General.--In the case of an individual, there
shall be allowed as a credit against the tax imposed by this
subtitle for the taxable year an amount equal to the
applicable percentage of the amount paid by the taxpayer (or
on behalf of the taxpayer) for coverage of the taxpayer or
qualifying family members under qualified health insurance
for eligible coverage months beginning in such taxable year.
``(b) Applicable Percentage.--For purposes of this
section--
``(1) In general.--Subject to paragraph (2), the term
`applicable percentage' means the standard Government
contribution (determined for full-time Federal employees
enrolling in coverage for which such contribution is not
limited by section 8906(b)(1) of title 5, United States Code)
for an employee enrolled in a health benefits plan under
chapter 89 of title 5, United States Code, for the calendar
year in which the taxable year begins, expressed as a
percentage of the total premium for such plan.
``(2) Increased percentage for certain taxpayers.--
``(A) In general.--In the case of a taxpayer whose adjusted
gross income for the preceding taxable year does not exceed
150 percent of the poverty level, the applicable percentage
determined under paragraph (1) shall be increased by such
percentage points as the Secretary determines will fully
compensate such an individual for the individual's limited
purchasing power in comparison to individuals whose adjusted
gross income equals the average adjusted gross income for all
Federal employees, to the extent that the amount of the
resulting increase in the credit amount for all such eligible
low-income individuals for the taxable year is not reasonably
expected to exceed the 5 percentage point dollar amount for
that year, as determined under subparagraph (B).
``(B) Determination of 5 percentage point dollar amount.--
For purposes of subparagraph (A), the 5 percentage point
dollar amount for any taxable year is the product of--
``(i) the total number of individuals receiving credits
under this section for such year, and
``(ii) the amount equal to 5 percent of the average health
insurance premium amount to which such credits are applied.
``(C) Rule of construction.--Nothing in this paragraph
shall be construed to prevent the Secretary from establishing
more than 1 level of supplemental assistance that provides
greater assistance to individuals with lower income,
determined as a percentage of poverty.
``(3) Application of fehbp coverage categories to
determination of credit.--The percentages described in
paragraphs (1) and (2) shall be applied to a taxpayer
consistent with the coverage categories (such as self or
family coverage) applied with respect to a health benefits
plan under chapter 89 of title 5, United States Code.
``(c) Maximum Premium Amount.--The amount paid for
qualified health insurance taken into account under
subsection (a) for any taxable year shall not exceed an
amount equal to the capped premium established for the
applicable State under section 204(c)(10) of the Health
Coverage, Affordability, Responsibility, and Equity Act of
2003 for the calendar year in which the such taxable year
begins.
``(d) Eligible Coverage Month.--For purposes of this
section--
``(1) In general.--The term `eligible coverage month' means
any month if during such month the taxpayer or a qualifying
family member--
``(A) is an eligible low-income individual,
``(B) is covered by qualified health insurance, the premium
for which is paid by the taxpayer (or on behalf of the
taxpayer),
``(C) does not have other specified coverage, and
``(D) is not imprisoned under Federal, State, or local
authority.
``(2) Joint returns.--In the case of a joint return, the
requirement of paragraph (1)(A) shall be treated as met with
respect to any month if at least 1 spouse satisfies such
requirement.
``(e) Eligible Low-Income Individual.--For purposes of this
section--
``(1) In general.--The term `eligible low-income
individual' means an individual--
``(A) who has not attained age 65,
``(B) whose adjusted gross income does not exceed 200
percent of the poverty level,
``(C) who is ineligible for the medicaid program or the
State children's health insurance program under title XIX or
XXI of the Social Security Act (other than under section 1928
of such Act),
``(D) who has limited access to health insurance coverage
through the employer of the individual or a member of the
individual's family (either because the employer does not
offer such coverage to the individual or because the employee
contribution for such coverage would exceed an amount equal
to 5 percent of the household income of such individual, as
determined in accordance with paragraph (2)),
``(E) who applies for a credit under this section not later
than 60 days after receiving notice of potential eligibility
for such credit, under procedures established by the
Secretary, and
``(F) who resides in a State where the eligibility
standards and methodologies applied under the medicaid and
State children's health insurance programs with respect to
individuals residing in the State who have not attained age
65 are not more restrictive (as determined under section
1902(a)(10)(C)(i)(III) of the Social Security Act) than the
standards and methodologies that applied under such programs
with respect to such individuals as of July 1, 2003.
``(2) Determination of eligibility.--
``(A) SCHIP agency.--
``(i) In general.--The determination of whether an
individual is an eligible low-income individual for purposes
of this section shall be made by the State agency with
responsibility for determining the eligibility of individuals
for assistance under the State children's health insurance
program under title XXI of the Social Security Act.
``(ii) Application of screen and enroll requirements.--

``(I) In general.--The State agency referred to in clause
(i) shall ensure that individuals applying for a certificate
of eligibility are screened for potential eligibility under
the medicaid and State children's health insurance programs
and that individuals found through screening to be eligible
for assistance under such a program are enrolled for
assistance under the appropriate program. To the maximum
extent possible pursuant to State options under title XIX of
the Social Security Act, and notwithstanding any otherwise
applicable provision of, or State plan provision under, such
title, screening and enrollment activities described in the
previous sentence shall use the procedures employed by the
State children's health insurance program operated under
title XXI of the Social Security Act, if such procedures
differ from those ordinarily employed by the State program
operated under title XIX of such Act.
``(II) No delay of issuance of certificate.--The
application of the screen and enroll requirements of clause
(i) shall not delay the issuance of a certificate of
eligibility to an individual for purposes of this section.
The State agency referred to in clause (i) shall adopt
procedures to ensure than an individual issued a certificate
of eligibility under this paragraph who is subsequently
determined to be eligible for the State medicaid program
under title XIX of the Social Security Act or the State
children's health insurance program under XXI of such Act
shall be enrolled in the appropriate program without an
interruption in the individual's health insurance coverage.

``(B) Standards.--
``(i) In general.--An individual is an eligible low-income
individual for purposes of this section if--

``(I) on the basis of the individual's tax return for the
preceding taxable year, the individual meets the requirements
of paragraph (1)(B), and the individual otherwise satisfies
the requirements of paragraph (1), or
``(II) the individual is determined to satisfy the
requirements of paragraph (1) after the application of the
same eligibility methodologies as would apply for purposes of
determining the eligibility of an individual for assistance
under the State children's health insurance program under
title XXI of the Social Security Act.

``(ii) Application of schip income determination
methodologies.--For purposes of clause (i)(II),
determinations of income levels shall be made using the
methodologies described in that clause, to the extent such
methodologies for ascertaining household income differ from
any otherwise applicable method for determining adjusted
gross income or the definition of adjusted gross income.
``(C) Certificate of eligibility.--
``(i) In general.--An individual who is determined to be an
eligible low-income individual shall be issued a certificate
of eligibility by the State agency referred to in
subparagraph (A).
``(ii) Certificate amount.--Such certificate shall indicate
the applicable percentage of the amount paid for coverage
under qualified health insurance that the individual is
eligible for under this section (including any supplemental
assistance which the individual may be eligible for under
subsection (b)(2), unless the individual elects to not
receive such supplemental assistance).
``(iii) 12-month period of issue.--The certificate of
eligibility shall apply for a 12-month period from the date
of issue, notwithstanding any changes in household
circumstances following the individual's application for a
credit under this section or supplemental assistance.
``(D) Supplemental assistance.--The State agency described
in subparagraph (A) shall determine an individual's
eligibility for supplemental assistance under subsection
(b)(2) based on the methodologies referred to in subparagraph
(B)(ii).
``(f) Qualifying Family Member.--For purposes of this
section--
``(1) In general.--The term `qualifying family member'
means--
``(A) the taxpayer's spouse, and

[[Page S5958]]

``(B) any dependent of the taxpayer with respect to whom
the taxpayer is entitled to a deduction under section 151(c).

Such term does not include any individual who is not an
eligible low-income individual under subsection (e)(1).
``(2) Special dependency test in case of divorced parents,
etc.--If paragraph (2) or (4) of section 152(e) applies to
any child with respect to any calendar year, in the case of
any taxable year beginning in such calendar year, such child
shall be treated as described in paragraph (1)(B) with
respect to the custodial parent (within the meaning of
section 152(e)(1)) and not with respect to the noncustodial
parent.
``(g) Qualified Health Insurance.--For purposes of this
section--
``(1) In general.--The term `qualified health insurance'
means any of the following:
``(A) Coverage under an insurance plan participating in a
purchasing pool established pursuant to section 203 of the
Health Coverage, Affordability, Responsibility, and Equity
Act of 2003.
``(B) Coverage under individual health insurance pursuant
to section 212 of such Act.
``(C) Coverage, pursuant to section 213 of such Act, under
the medicaid program or the State children's health insurance
program if 1 or more family members qualifies for coverage
under such program.
``(D) Coverage, pursuant to section 214 of such Act, under
an employer-sponsored insurance plan, including--
``(i) coverage under a COBRA continuation provision (as
defined in section 9832(d)(1)),
``(ii) State-based continuation coverage provided under a
State law that requires such coverage,
``(iii) coverage voluntarily offered by a former employer
of the individual or family member; or
``(iv) coverage under a group health plan that is available
through the employment of the individual or a family member.
``(2) Exception.--The term `qualified health insurance'
shall not include--
``(A) a flexible spending or similar arrangement, and
``(B) any insurance if substantially all of its coverage is
of excepted benefits described in section 9832(c).
``(3) Definitions.--For purposes of this subsection--
``(A) Employer-sponsored insurance.--
``(i) In general.--The term `employer-sponsored insurance'
means any insurance which covers medical care under any
health plan maintained by any employer (or former employer)
of the taxpayer or the taxpayer's spouse.
``(ii) Treatment of cafeteria plans.--For purposes of
clause (i), the cost of coverage shall be treated as paid or
incurred by an employer to the extent the coverage is in lieu
of a right to receive cash or other qualified benefits under
a cafeteria plan (as defined in section 125(d)).
``(B) Individual health insurance.--The term `individual
health insurance' means any insurance which constitutes
medical care offered to individuals other than in connection
with a group health plan and does not include Federal- or
State-based health insurance coverage.
``(h) Other Specified Coverage.--For purposes of this
section, an individual has other specified coverage for any
month if, as of the first day of such month--
``(1) Coverage under medicare.--Such individual is entitled
to benefits under part A of title XVIII of the Social
Security Act or is enrolled under part B of such title.
``(2) Certain other coverage.--Such individual--
``(A) is enrolled in a health benefits plan under chapter
89 of title 5, United States Code, or
``(B) is entitled to receive benefits under chapter 55 of
title 10, United States Code.
``(i) Federal Poverty Level; Poverty Level; Poverty.--For
purposes of this section, the terms `Federal poverty level' ,
`poverty level', and `poverty' mean the income official
poverty line (as defined by the Office of Management and
Budget, and revised annually in accordance with section
673(2) of the Omnibus Budget Reconciliation Act of 1981)
applicable to a family of the size involved.
``(j) Special Rules.--
``(1) Coordination with advance payments of credit.--With
respect to any taxable year, the amount which would (but for
this subsection) be allowed as a credit to the taxpayer under
subsection (a) shall be reduced (but not below zero) by the
aggregate amount paid on behalf of such taxpayer under
section 7528 for months beginning in such taxable year.
``(2) Coordination with other deductions.--Amounts taken
into account under subsection (a) shall not be taken into
account in determining any deduction allowed under section
162(l) or 213.
``(3) MSA distributions.--Amounts distributed from an
Archer MSA (as defined in section 220(d)) shall not be taken
into account under subsection (a).
``(4) Denial of credit to dependents.--No credit shall be
allowed under this section to any individual with respect to
whom a deduction under section 151 is allowable to another
taxpayer for a taxable year beginning in the calendar year in
which such individual's taxable year begins.
``(5) Both spouses eligible low-income individuals.--The
spouse of the taxpayer shall not be treated as a qualifying
family member for purposes of subsection (a), if--
``(A) the taxpayer is married at the close of the taxable
year,
``(B) the taxpayer and the taxpayer's spouse are both
eligible low-income individuals during the taxable year, and
``(C) the taxpayer files a separate return for the taxable
year.
``(6) Marital status; certain married individuals living
apart.--Rules similar to the rules of paragraphs (3) and (4)
of section 21(e) shall apply for purposes of this section.
``(7) Insurance which covers other individuals.--For
purposes of this section, rules similar to the rules of
section 213(d)(6) shall apply with respect to any contract
for qualified health insurance under which amounts are
payable for coverage of an individual other than the taxpayer
and qualifying family members.
``(8) Treatment of payments.--For purposes of this section:
``(A) Payments by secretary.--Any payment made by the
Secretary on behalf of any individual under section 7528
(relating to advance payment of credit for health insurance
costs of eligible low-income individuals) shall be treated as
having been made by the taxpayer (or on behalf of the
taxpayer) on the first day of the month for which such
payment was made.
``(B) Payments by taxpayer.--Any payment made by the
taxpayer (or on behalf of the taxpayer) for eligible coverage
months shall be treated as having been so made on the first
day of the month for which such payment was made.
``(9) Regulations.--
``(A) In general.--The Secretary, in consultation with the
Secretary of Health and Human Services, shall administer the
credit allowed under this section and shall prescribe such
regulations and other guidance as may be necessary or
appropriate to carry out this section, section 6050U, and
section 7528.
``(B) Eligibility determinations.--Such regulations shall
include such standards as the Secretary of Health and Human
Services may specify with respect to the requirements for
eligibility determinations under subsection (e)(2).
``(C) Measures to combat fraud and abuse.--Such regulations
shall include appropriate procedures to deter, detect, and
penalize fraudulent efforts to obtain a credit under this
section by individuals, providers of qualified health
insurance, and others.''.
(b) Conforming Amendments.--
(1) Paragraph (2) of section 1324(b) of title 31, United
States Code, is amended by inserting before the period ``, or
from section 36 of such Code''.
(2) The table of sections for subpart C of part IV of
chapter 1 of the Internal Revenue Code of 1986 is amended by
striking the last item and inserting the following new items:

``Sec. 36. Health insurance costs of eligible low-income individuals.
``Sec. 37. Overpayments of tax.''.

(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2005.
(d) Reimbursement for Administrative Costs Incurred in
Determining Eligibility for Credit.--
(1) In General.--The Secretary of Health and Human Services
shall reimburse States for the reasonable administrative
costs incurred in making eligibility determinations in
accordance with section 36(e) of the Internal Revenue Code of
1986 (as added by subsection (a)). Such reimbursement shall
not apply to State costs required under the medicaid or State
children's health insurance programs.
(2) Application.--A State desiring reimbursement under this
subsection shall submit an application to the Secretary of
Health and Human Services in such manner, at such time, and
containing such information as the Secretary may require.
(3) Appropriation.--Out of any money in the Treasury of the
United States not otherwise appropriated, there are
appropriated such sums as may be necessary to carry out this
subsection.

SEC. 112. ADVANCE PAYMENT OF CREDIT FOR HEALTH INSURANCE
COSTS OF ELIGIBLE LOW-INCOME INDIVIDUALS.

(a) In General.--Chapter 77 of the Internal Revenue Code of
1986 (relating to miscellaneous provisions) is amended by
adding at the end the following new section:

``SEC. 7528. ADVANCE PAYMENT OF CREDIT FOR HEALTH INSURANCE
COSTS OF ELIGIBLE LOW-INCOME INDIVIDUALS.

``(a) General Rule.--Not later than August 1, 2005, the
Secretary shall establish a program for making payments on
behalf of certified individuals to providers of qualified
health insurance (as defined in section 36(g)) for such
individuals.
``(b) Limitation on Advance Payments During any Taxable
Year.--The Secretary may make payments under subsection (a)
only to the extent that the total amount of such payments
made on behalf of any individual during the taxable year is
not reasonably expected to exceed the applicable percentage
(as defined in section 36(b)) of the amount paid by the
taxpayer (or on behalf of the taxpayer) for coverage of the
taxpayer and qualifying family members under qualified health
insurance for eligible coverage months beginning in the
taxable year.
``(c) Certified Individual.--For purposes of this section,
the term `certified individual' means any individual for whom
a health coverage eligibility certificate is in effect.

[[Page S5959]]

``(d) Health Coverage Eligibility Certificate.--For
purposes of this section, the term `health coverage
eligibility certificate' means any written statement that an
individual is an eligible low-income individual (as defined
in section 36(e)) if such statement provides such information
as the Secretary may require for purposes of this section and
is issued by the State agency responsible for administering
the State children's health insurance program under title XXI
of the Social Security Act.''.
(b) Disclosure of Return Information for Purposes of
Carrying Out a Program for Advance Payment of Credit for
Health Insurance Costs of Eligible Low-Income Individuals.--
(1) In general.--Subsection (l) of section 6103 of the
Internal Revenue Code of 1986 (relating to disclosure of
returns and return information for purposes other than tax
administration) is amended by adding at the end the following
new paragraph:
``(19) Disclosure of return information for purposes of
carrying out a program for advance payment of credit for
health insurance costs of eligible low-income individuals.--
The Secretary may disclose to providers of health insurance
for any certified individual (as defined in section 7528(c))
return information with respect to such certified individual
only to the extent necessary to carry out the program
established by section 7528 (relating to advance payment of
credit for health insurance costs of eligible low-income
individuals).''.
(2) Procedures and recordkeeping related to disclosures.--
Subsection (p) of such section is amended--
(A) in paragraph (3)(A) by striking ``or (18)'' and
inserting ``(18), or (19)'', and
(B) in paragraph (4), as amended by section 202(b)(2)(B) of
the Trade Act of 2002 (Public Law 107-210; 116 Stat. 961), by
striking ``or (17)'' after ``any other person described in
subsection (l)(16)'' each place it appears and inserting
``(18), or (19)''.
(3) Unauthorized inspection of returns or return
information.--Section 7213A(a)(1)(B) of such Code is amended
by striking ``section 6103(n)'' and inserting ``subsection
(l)(18) or (19) or (n) of section 6103''.
(c) Information Reporting.--
(1) In general.--Subpart B of part III of subchapter A of
chapter 61 of the Internal Revenue Code of 1986 (relating to
information concerning transactions with other persons) is
amended by inserting after section 6050T the following new
section:

``SEC. 6050U. RETURNS RELATING TO CREDIT FOR HEALTH INSURANCE
COSTS OF ELIGIBLE LOW-INCOME INDIVIDUALS.

``(a) Requirement of Reporting.--Every person who is
entitled to receive payments for any month of any calendar
year under section 7528 (relating to advance payment of
credit for health insurance costs of eligible low-income
individuals) with respect to any certified individual (as
defined in section 7528(c)) shall, at such time as the
Secretary may prescribe, make the return described in
subsection (b) with respect to each such individual.
``(b) Form and Manner of Returns.--A return is described in
this subsection if such return--
``(1) is in such form as the Secretary may prescribe, and
``(2) contains--
``(A) the name, address, and TIN of each individual
referred to in subsection (a),
``(B) the number of months for which amounts were entitled
to be received with respect to such individual under section
7528 (relating to advance payment of credit for health
insurance costs of eligible low-income individuals),
``(C) the amount entitled to be received for each such
month, and
``(D) such other information as the Secretary may
prescribe.
``(c) Statements To Be Furnished to Individuals With
Respect to Whom Information Is Required.--Every person
required to make a return under subsection (a) shall furnish
to each individual whose name is required to be set forth in
such return a written statement showing--
``(1) the name and address of the person required to make
such return and the phone number of the information contact
for such person, and
``(2) the information required to be shown on the return
with respect to such individual.

The written statement required under the preceding sentence
shall be furnished on or before January 31 of the year
following the calendar year for which the return under
subsection (a) is required to be made.''.
(2) Assessable penalties.--
(A) Subparagraph (B) of section 6724(d)(1) of such Code
(relating to definitions) is amended by redesignating clauses
(xii) through (xviii) as clauses (xiii) through (xix),
respectively, and by inserting after clause (xi) the
following new clause:
``(xii) section 6050U (relating to returns relating to
credit for health insurance costs of eligible low-income
individuals),''.
(B) Paragraph (2) of section 6724(d) of such Code is
amended by striking ``or'' at the end of subparagraph (AA),
by striking the period at the end of subparagraph (BB) and
inserting ``, or'', and by adding after subparagraph (BB) the
following new subparagraph:
``(CC) section 6050U (relating to returns relating to
credit for health insurance costs of eligible low-income
individuals).''.
(d) Clerical Amendments.--
(1) Advance payment.--The table of sections for chapter 77
of the Internal Revenue Code of 1986 is amended by adding at
the end the following new item:

``Sec. 7528. Advance payment of credit for health insurance costs of
eligible low-income individuals.''.

(2) Information reporting.--The table of sections for
subpart B of part III of subchapter A of chapter 61 of such
Code is amended by inserting after the item relating to
section 6050T the following new item:

``Sec. 6050U. Returns relating to credit for health insurance costs of
eligible low-income individuals.''.

(e) Effective Date.--The amendments made by this section
shall take effect on January 1, 2006.

TITLE II--IMPROVING ACCESS TO HEALTH PLANS

SEC. 201. DEFINITIONS.

In this title:
(1) Eligible individual.--The term ``eligible individual''
means an individual with respect to whom a tax credit is
allowed under section 36 of the Internal Revenue Code of 1986
(as added by section 111).
(2) Participating insurer.--The term ``participating
insurer'' means an entity with a contract under section
205(a).
(3) Private group health insurance plan.--The term
``private group health insurance plan'' means a plan offered
by a participating insurer that provides health benefits
coverage to eligible individuals and that meets the
requirements of this title.
(4) Purchasing pool operator.--The term ``purchasing pool
operator'' means the entity designated by the State under
section 204.
(5) Secretary.--The term ``Secretary'' means the Secretary
of Health and Human Services.
(6) Small employer.--The term ``small employer'' means an
employer with not less than 2 and not more than 100
employees.

SEC. 202. ESTABLISHMENT OF HEALTH INSURANCE PURCHASING POOLS.

There is established a program under which the Secretary
shall ensure that each eligible individual has the
opportunity to enroll, through a purchasing pool operator, in
a private group health insurance plan offered by a
participating insurer under this title.

SEC. 203. PURCHASING POOLS.

(a) Establishment of Purchasing Pools.--Each State
participating in the program under this title shall establish
a purchasing pool that is available to each eligible
individual who resides in the State.
(b) Types of Purchasing Pools.--
(1) In general.--A purchasing pool established under
subsection (a) shall be 1 of the following:
(A) A statewide purchasing pool operated by the State.
(B) A statewide purchasing pool operated on behalf of the
State by the Director of the Office of Personnel Management,
or the designee of such Director.
(2) OPM operated pool.--In the case of a statewide
purchasing pool described in paragraph (1)(B), the Director
of the Office of Personnel Management or the Director's
designee, may limit participating insurers in such pool to
those described in section 205(e), except that the Director
or such designee shall ensure that additional private group
health insurance plans participate in such a pool to the
extent necessary to meet the requirements of section
204(c)(9).
(c) State Election Process.--
(1) In general.--Each State participating in the program
under this title shall notify the Secretary, not later than
January 4, 2005, of the type of purchasing pool that applies
to residents of the State.
(2) Default choice.--If a State participating in the
program under this title fails to notify the Secretary of the
type of purchasing pool elected by the State by the date
described in paragraph (1), the State shall be deemed to have
elected the type of purchasing pool described in subsection
(b)(1)(B).
(3) Change of election.--The Secretary shall establish
procedures under which a State participating in the program
under this title may change the election of the type of
purchasing pool applicable to residents of the State.

SEC. 204. PURCHASING POOL OPERATORS.

(a) Designation.--Each State shall designate a purchasing
pool operator that shall be responsible for operating the
purchasing pool established under section 203(a). A
purchasing pool operator may be (or, to have 1 or more of its
functions performed, may contract with) a private entity that
has entered into a contract with the State if such entity
meets requirements established by the Secretary for purposes
of the program under this title.
(b) Operation Similar to FEHBP.--Each purchasing pool
operator shall operate the purchasing pool established under
section 203(a) in a manner that is similar to the manner in
which the Director of the Office of Personnel Management
operates the Federal employees' health benefits program under
chapter 89 of title 5, United States Code, including (but not
limited to) the performance of the specific functions
described in subsection (c).
(c) Specific Functions Described.--The specific functions
described in this subsection include the following:
(1) Each purchasing pool operator shall offer one-stop
shopping for eligible individuals to enroll for health
benefits coverage

[[Page S5960]]

under private, group health insurance plans offered by
participating insurers.
(2) Each purchasing pool operator shall limit participating
insurers to those that meet the conditions for participation
described in this title.
(3) Each purchasing pool operator shall negotiate (or, in
the case of a purchasing pool described in section
203(b)(1)(B), shall negotiate or otherwise determine) bids
and terms of coverage with insurers.
(4) Each purchasing pool operator shall provide eligible
individuals with comparative information on private group
health insurance plans offered by participating insurers.
(5) Each purchasing pool operator shall assist eligible
individuals in enrolling with a private group health
insurance plan offered by a participating insurer.
(6) Each purchasing pool operator shall collect private
group health insurance plan premium payments for
participating insurers and process such premium payments.
(7) Each purchasing pool operator shall reconcile from year
to year aggregate premium payments and claims costs of
private group health insurance plans consistent with
practices under the Federal employees' health benefits
program under chapter 89 of title 5, United States Code.
(8) Each purchasing pool operator shall offer customer
service to eligible individuals enrolled for health benefits
coverage under a private group health insurance plan offered
by a participating insurer.
(9) Each purchasing pool operator shall ensure that each
eligible individual has the option of enrolling in either of
at least 2 benchmark or benchmark-equivalent plans with--
(A) a premium at or below a cap established by the pool
operator for purposes of this title; and
(B) coverage of essential services included in the report
required under section 301(e)(2), with cost-sharing
consistent with such report.
(10) Each purchasing pool operator shall establish a
premium cap for purposes of determining the credit limitation
under section 36(c) of the Internal Revenue Code of 1986, as
added by section 111(a). The cap required under this
paragraph may not be less than the premium charged to Federal
employees by the most highly-enrolled health plan under the
Federal employees' health benefits program under chapter 89
of title 5, United States Code. If the most highly-enrolled
plan in that program differs for Federal enrollees in the
State and all Federal enrollees nationally in such plan, the
minimum permitted premium cap shall be the lower of such
premiums.

SEC. 205. CONTRACTS WITH PARTICIPATING INSURERS.

(a) In General.--Each purchasing pool operator shall
negotiate and enter into contracts for the provision of
health benefits coverage under the program under this title
with entities that meet the conditions of participation
described in subsection (b) and other applicable requirements
of this Act.
(b) Consumer Information.--In carrying out its duty under
section 204(c)(4) to inform eligible individuals about
private group health plans, the purchasing pool operator
shall provide information that meets the requirements of
section 212(b)(2).
(c) State Licensure.--
(1) In general.--Subject to paragraph (2), a health plan
shall not be a participating insurer unless the plan has a
State license to provide State residents with the private
group coverage health insurance plans that it offers through
the pool.
(2) Exception.--A pool operator may enter into a contract
under subsection (a) to cover pool participants through a
health plan without a State license described in paragraph
(1) if such plan is offered to Federal employees nationwide
and, with respect to such employees, is exempt from State
health insurance regulation. Nothing in this paragraph shall
be construed to permit coverage of pool participants through
such a plan except with groups, contracts, and premium rates
that are entirely distinct from those used for individuals
covered under the Federal employee's health benefits program
under chapter 89 of title 5, United States Code.
(d) Additional Stop-Loss Coverage and Reinsurance.--
Purchasing pool operators are authorized to encourage
participation in the program under this title, improve
covered benefits, reduce out-of-pocket cost-sharing, limit
premiums, or achieve other objectives of this Act by--
(1) funding stop-loss coverage above levels otherwise
offered in the purchasing pool; or
(2) providing or subsidizing reinsurance in addition to
that provided under section 211.
(e) Participation of FEHBP Plans.--
(1) In general.--Each entity with a contract under section
8902 of title 5, United States Code, shall be a participating
insurer unless such entity notifies the Secretary in writing
of its intention not to participate in the program under this
title prior to such time as is designated by the Secretary so
as to allow such decisions to be taken into account with
respect to eligible individuals' choice of a private group
health insurance plan under such program. Such participation
in the program under this title shall include at least the
covered benefits and provider networks available through such
an entity and shall not involve greater out-of-pocket cost-
sharing than the plan offered by such entity pursuant to its
contract under section 8902 of title 5, United States Code.
(2) No effect on fehbp coverage.--The Director of Office of
Personnel Management shall take such steps as are necessary
to ensure that each individual enrolled for health benefits
coverage under the program under chapter 89 of title 5,
United States Code, is not adversely affected by eligible
individuals or others enrolled for coverage under the program
under this title. Such steps shall include (but need not be
limited to) the establishment of separate risk pools,
separate contracts with participating insurers, and
separately negotiated premiums.

SEC. 206. OPTIONS FOR HEALTH BENEFITS COVERAGE.

(a) Scope of Health Benefits Coverage.--The health benefits
coverage provided to an eligible individual under a private
group health insurance plan offered by a participating
insurer shall consist of any of the following:
(1) Benchmark coverage.--Health benefits coverage that is
equivalent to the benefits coverage in a benchmark benefit
package described in subsection (b).
(2) Benchmark-equivalent coverage.--Health benefits
coverage that meets the following requirements:
(A) Inclusion of essential services.--The coverage includes
each of the essential services identified by the National
Advisory Commission on Expanded Access to Health Care and
adopted by Congress under title III.
(B) Aggregate actuarial value equivalent to benchmark
package.--The coverage has an aggregate actuarial value that
is equal to or greater than the actuarial value of one of the
benchmark benefit packages.
(3) Alternative coverage.--Any other health benefits
coverage that the Secretary determines, upon application by a
State, offers health benefits coverage equivalent to or
greater than a plan described in and offered under section
8903(1) of title 5, United States Code.
(b) Benchmark Benefit Packages.--The benchmark benefit
packages are as follows:
(1) FEHBP-equivalent health benefits coverage.--The plan
described in and offered under chapter 89 of title 5, United
States Code with the highest number of enrollees under such
section for the year preceding the year in which the private
group health insurance plan is proposed to be offered.
(2) Public program-equivalent health benefits coverage.--
Coverage provided under the State plan approved under the
medicaid program under title XIX of the Social Security Act
or the State children's health insurance program under title
XXI of such Act (42 U.S.C. 1396 et seq., 1397aa et seq.)
(without regard to coverage provided under a waiver of the
requirements of either such program).
(3) Coverage offered through hmo.--The health insurance
coverage plan that--
(A) is offered by a health maintenance organization (as
defined in section 2791(b)(3) of the Public Health Service
Act (42 U.S.C. 33gg-91(b)(3))), and
(B) has the largest insured commercial, nonmedicaid
enrollment of covered lives of such coverage plans offered by
such a health maintenance organization in the State.
(4) State employee coverage.--The health insurance plan
that is offered to State employees and has the largest
enrollment of covered lives of any such plan.
(5) Application of benchmark standards.--A private group
health plan offers benchmark benefits if, with respect to a
benchmark plan described in paragraph (1), (2), (3), or (4),
the private group health plan covers all items and services
offered by the benchmark plan, with out-of-pocket cost-
sharing for such items and services that is not greater than
under the benchmark plan. Nothing in this title shall be
construed to forbid a private group health plan from offering
additional items and services not covered by such a benchmark
plan or reducing out-of-pocket cost-sharing below levels
applicable under such plan.

SEC. 207. ENROLLMENT PROCESS FOR ELIGIBLE INDIVIDUALS.

(a) In General.--The Secretary shall establish a process
through which an eligible individual--
(1) may make an annual election to enroll in any private
group health insurance plan offered by a participating
insurer that has been awarded a contract under section 205(a)
and serves the geographic area in which the individual
resides, provided that such insurer's geographic area of
service and guaranteed issuance under this section is
conterminous with, or includes all of, a geographic area
served pursuant to an entity's contact under section 8902 of
title 5, United States Code; and
(2) may make an annual election to change the election
under this clause.
(b) Rules.--In establishing the process under subsection
(a), the Secretary shall use rules similar to the rules for
enrollment, disenrollment, and termination of enrollment
under the Federal employees health benefits program under
chapter 89 of title 5, United States Code, including the
application of the guaranteed issuance provision described in
subsection (c).
(c) Guaranteed Issuance.--An eligible individual who is
eligible to enroll for health benefits coverage under a
private group health insurance plan that has been awarded a
contract under section 205(a) at a time during which
elections are accepted under this title with respect to the
plan shall not be denied enrollment based on any health
status-related factor (described in section 2702(a)(1) of the
Public Health Service Act (42 U.S.C. 300gg-1(a)(1))) or any
other factor.

[[Page S5961]]

SEC. 208. PLAN PREMIUMS.

(a) In General.--Each purchasing pool operator shall
negotiate (or, in the case of a purchasing pool operated
pursuant to section 203(b)(1)(B), shall otherwise determine)
a premium for each private group health insurance plan
offered by a participating insurer.
(b) Permitted Profit Margins.--
(1) In general.--Each premium negotiated under subsection
(a) may not permit a profit margin that exceeds the
applicable percentage (as defined in paragraph (2)).
(2) Applicable percentage defined.--In this subsection, the
term ``applicable percentage'' means--
(A) for the first 3 years that a purchasing pool is
operated, 2 percent;
(B) for any subsequent year, the percentage determined by
the purchasing pool operator, which may not be--
(i) less than the profit margin permitted under the Federal
employees health benefits program under chapter 89 of title
5, United States Code; or
(ii) more than a multiple, established by the Secretary for
purposes of this subsection, of profit margins permitted
under such program.

SEC. 209. ENROLLEE PREMIUM SHARE.

(a) In General.--A participating insurer offering a private
group health insurance plan that has been awarded a contract
under section 205(a) in which the eligible individual is
enrolled may not deny, limit, or condition the coverage
(including out-of-pocket cost-sharing) or provision of health
benefits coverage or vary or increase the enrollee premium
share under the plan based on any health status-related
factor described in section 2702(a)(1) of the Public Health
Service Act (42 U.S.C. 300gg-1(a)(1)) or any other factor.
(b) Risk-Adjusted Plan Payments and Premiums Charged to
Enrollees.--
(1) In general.--For each private group health insurance
plan operated by a participating insurer, the pool operator
shall adjust premium payments to compensate for the
difference in health risk factors between plan enrollees and
State residents as a whole (including residents who are not
eligible individuals). Such adjustments shall employ risk-
adjustment mechanisms promulgated by the Secretary.
(2) Additional adjustments.--The pool operator shall also
provide additional adjustments to premium payments that
compensate participating insurers for the cost of keeping
out-of-pocket cost-sharing amounts consistent with section
204(c)(9)(B).
(3) Enrollee premium costs.--The adjustments described in
this subsection shall not affect enrollee premium shares,
which shall be based on the premium that would be charged for
enrollees with health risk factors for State residents as a
whole (as described in paragraph (1)), without taking into
account cost-sharing adjustments under section 204(c)(9)(B).
(c) Amount of Premium.--The amount of the enrollee premium
share shall be equal to premium amounts (if any) above the
applicable cap set pursuant to section 204(c)(10), plus 100
percent of the remainder minus the applicable percentage (as
defined in section 36(b) of the Internal Revenue Code of
1986, as added by section 111).

SEC. 210. PAYMENTS TO PURCHASING POOL OPERATORS AND PAYMENTS
TO PARTICIPATING INSURERS.

The Secretary shall establish procedures for making
payments to each purchasing pool operator as follows:
(1) Risk-adjustment payment.--The Secretary shall pay each
purchasing pool operator for the net costs of risk-adjusted
payments to plans under section 209(b), to the extent the sum
of upward adjustments exceeds the sum of downward adjustments
for the pool operator.
(2) Stop-loss and reinsurance payments.--
(A) In general.--The Secretary shall pay each purchasing
pool operator for the applicable percentage (as defined in
subparagraph (B)) of--
(i) the costs of any stop-loss coverage funded by the
purchasing pool operator under section 205(d)(1); and
(ii) any reinsurance provided in accordance with section
205(d)(2).
(B) Applicable percentage defined.--In this paragraph, the
term ``applicable percentage'' means--
(i) for the first 3 years that a purchasing pool is
operated, 100 percent;
(ii) for the next 2 years that such purchasing pool is
operated, 50 percent; and
(iii) for any subsequent year, 0 percent.
(3) Payments necessary to keep cost-sharing within
applicable limits.--The Secretary shall make payments to
purchasing pool operators to reimburse purchasing pool
operators for the amount paid by such operators to
participating insurers necessary to keep out-of-pocket cost-
sharing for individuals with limited ability to pay within
applicable limits.
(4) Payment for administrative costs.--The Secretary shall
make payments to each purchasing pool operator for necessary
pool administrative expenses.
(5) Payments to opm.--In the case of a purchasing pool
described in section 203(b)(1)(B), payments under this
section shall be made to the Director of the Office of
Personnel Management.

SEC. 211. STATE-BASED REINSURANCE PROGRAMS.

(a) Establishment.--The Secretary shall establish standards
for State-based reinsurance programs for eligible individuals
to guard against adverse selection and to improve the
functioning of the individual health insurance market.
(b) Grants for Statewide Reinsurance Programs.--
(1) In general.--The Secretary may award grants to States
for the reasonable costs incurred in providing reinsurance
under this section, consistent with standards developed by
the Secretary, for coverage offered in the individual health
insurance market and through State-based purchasing pools
described in section 203.
(2) Limitation.--Such grants may not pay for reinsurance
extending beyond individuals in the top 3 percent of the
national health care spending distribution, as determined by
the Secretary.
(3) Application.--A State desiring a grant under this
section shall submit an application to the Secretary in such
manner, at such time, and containing such information as the
Secretary may require.
(4) Authorization of appropriations.--There are authorized
to be appropriated to the Secretary such sums as may be
necessary for making grants under this section.

SEC. 212. COVERAGE UNDER INDIVIDUAL HEALTH INSURANCE.

(a) In General.--Eligible individuals may use credits
allowed under the Internal Revenue Code of 1986 (including
supplemental assistance provided under such Code) for the
purchase of health insurance coverage to enroll in State-
licensed individual health insurance meeting the conditions
of participation described in subsection (b).
(b) Conditions of Participation.--The Secretary shall
promulgate regulations that establish the terms and
conditions under which an entity may participate in the
program under this section and that include the following:
(1) Plan marketing.--Conditions of participation for plans
in the individual market (as developed by the Secretary)
that--
(A) ensure that consumers receive the consumer information
described in paragraph (2) before selecting a plan; and
(B) detect, deter, and penalize marketing fraud by entities
offering or purporting to offer individual insurance.
(2) Consumer information.--Requirements for each entity
offering individual insurance to provide eligible individuals
with information in a uniform and easily comprehensible
manner that allows for informed comparisons by eligible
individuals and that includes information regarding the
health benefits coverage, costs, provider networks, quality,
the amount and proportion of health insurance premium
payments that go directly to patient care, and the plan's
coverage rules (including amount, duration, and scope limits)
and out-of-pocket cost-sharing (both inside and outside plan
networks) for each essential service recommended by the
National Advisory Commission on Expanded Access to Health
Care and adopted by Congress under title III (which shall be
prominently identified as an essential service, including by
reference to the Commission recommendation denoting the
service as essential). To the maximum extent feasible, such
requirements shall specify that the content and presentation
of the information shall be provided in the same manner as
similar information is presented to enrollees in the Federal
employees health benefits program under chapter 89 of title
5, United States Code.
(3) Other conditions, including the elimination of barriers
to affordable coverage.--
(A) In general.--Requirements for each entity offering
individual insurance to abide by conditions of participation
that the Secretary believes are reasonable and appropriate
measures to address barriers to affordable health insurance
coverage.
(B) Specific conditions.--The requirements developed by the
Secretary under subparagraph (A) shall include (but need not
be limited to)--
(i) guaranteed renewability, without premium increases
based on changed individual risk; and
(ii) limits on risk rating.
(4) Rule of construction.--Nothing in this section shall be
construed to authorize the Secretary to impose any
requirements on individual insurance, except with respect to
eligible individuals purchasing individual insurance using
advance payment of a tax credit provided under section 36 of
the Internal Revenue Code of 1986.

SEC. 213. USE OF PREMIUM SUBSIDIES TO UNIFY FAMILY COVERAGE
WITH MEMBERS ENROLLED IN MEDICAID AND SCHIP.

Notwithstanding any other provision of law, the Secretary
shall establish procedures under which, in the case of a
family with 1 or more members enrolled in with a managed care
entity under the State medicaid program under title XIX of
the Social Security Act or the State children's health
insurance program under title XXI of such Act (42 U.S.C. 1396
et seq., 1397aa et seq.) and 1 or more members who are an
eligible individual under this title, the family shall have
the option to enroll all family members with the managed care
entity under either or both such State programs. The
procedures established by the Secretary shall provide that
premiums charged to eligible individuals for enrollment with
such an entity shall be based on the capitated payments
established for adults or children, excluding adults and
children who are known to be pregnant, blind, disabled, or
(in the case of adults) elderly, under the applicable State
program

[[Page S5962]]

(except that, in the case of an eligible individual known to
be pregnant, premiums shall reflect capitated payments
established under such State program for individuals known to
be pregnant) plus reasonable administrative costs.

SEC. 214. COVERAGE THROUGH EMPLOYER-SPONSORED HEALTH
INSURANCE.

(a) In General.--Eligible individuals may use credits
allowed under the Internal Revenue Code of 1986 and
supplemental assistance to enroll in coverage offered by
eligible employers.
(b) Eligible Employers.--For purposes of this section, the
term ``eligible employers'' includes the following:
(1) The current employer of the eligible individual or a
member of such individuals family.
(2) A former employer required to offer coverage of the
eligible individual under a COBRA continuation provision (as
defined in section 9832(d)(1) of the Internal Revenue Code)
or a State law requiring continuation coverage; and
(3) A former employer voluntarily offering coverage of the
eligible individual.
(c) Application of Disregard of Preexisting Conditions
Exclusions.--Notwithstanding any other provision of law, in
the case of an individual who experiences a qualifying event
(as defined in section 603 of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1163) and who, not later than
6 months after such event, is determined to be an eligible
individual under this title, the same rules with respect to
preexisting conditions as apply to a nonelecting TAA-eligible
individual under section 605(b) of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1165(b)) shall apply
with respect to such individual, regardless of which type of
qualified coverage the individual purchases.
(d) Extension of COBRA Election Period.--Notwithstanding
any other provision of law, in the case of an individual who
experiences a qualifying event (as defined in section 603 of
the Employee Retirement Income Security Act of 1974 (29
U.S.C. 1163) and who, not later than 6 months after such
event, is determined to be an eligible individual under this
title, the same rules with respect to the temporary extension
of a COBRA election period as apply to a nonelecting TAA-
eligible individual under section 605(b) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1165(b))
shall apply with respect to such individual.
(e) Current Employer Coverage.--If an eligible individual
uses the credits allowed under the Internal Revenue Code of
1986 and supplemental assistance to purchase coverage from an
employer described in subsection (b), such credits and
assistance shall apply as a percentage, not of the total
premium amount for the eligible individual, but of the
employee's or former employee's share of premium payments.

SEC. 215. PARTICIPATION BY SMALL EMPLOYERS.

(a) In General.--Notwithstanding any other provision of
this title, the Secretary shall establish procedures under
which, during annual open enrollment periods, a small
employer shall have the option of purchasing group coverage
for employees and dependents of employees, including
individuals who are not otherwise eligible individuals under
this title, through a purchasing pool established under
section 203(a).
(b) Conditions of Participation.--
(1) In general.--Except as otherwise provided in this
subsection, the same requirements that apply with respect to
participating insurers covering eligible low-income
individuals under section 203 shall apply with respect to
coverage offered by such insurers through a small employer.
(2) Risk adjustment.--
(A) Increased payments.--If employees of a small employer
who are not otherwise eligible individuals under this title
enroll in a private group health insurance plan under this
title and have a collective risk level that exceeds the
statewide average (as determined pursuant to risk adjustment
mechanisms developed by the Secretary consistent with section
209(b)(1)), the Secretary (through a pool operator) shall
provide participating insurers with such small employer
enrollment bonus payments as are necessary to compensate the
insurers for such increased risk. The premium charged to
enrollees under this section shall be the same premium that
is the basis of premium charges to enrollees who are eligible
low-income individuals.
(B) Reduced payments.--A pool operator shall reduce
payments to any plan with a risk level that falls below the
statewide average (as so determined).
(3) Administrative guidelines.--The Secretary shall develop
guidelines for pool operators to use in serving small
employers, which shall be modeled after existing, successful,
longstanding small business purchasing cooperatives, and
shall include administratively simple methods for small
employers and licensed insurance brokers to participate in
the program established under this title.
(c) Information Campaign.--
(1) In general.--The pool operator for a State shall
establish and conduct, directly or through 1 or more public
or private entities (which may include licensed insurance
brokers), a health insurance information program to inform
small employers about health coverage for employees.
(2) Requirements.--The program established under paragraph
(1) shall educate small employers with respect to matters
that include (but are not limited to) the following:
(A) The benefits of providing health insurance to
employees, including tax benefits to both the employer and
employees, increased productivity, and decreased employee
turnover.
(B) The rights of small employers under Federal and State
health insurance reform laws.
(C) Options for purchasing coverage, including (but not
limited to) through the State's purchasing pool operated
pursuant to section 203.
(d) Grants To Help State-Based Pools Promote Small Business
Coverage.--
(1) In general.--The Secretary may award grants to a pool
operator for the following:
(A) The net costs of risk-adjusted payments under paragraph
(b)(2), to the extent the sum of upward adjustments exceeds
the sum of downward adjustments for the pool operator.
(B) The reasonable cost of the information campaign under
subsection (c).
(C) The pool operator's reasonable administrative costs to
implement this section.
(2) Limitation.--This section shall not apply to a State's
pool unless sufficient grant funds have been received under
this subsection to implement this section on a fiscally sound
basis and such receipt is certified by the pool operator.
(3) Application.--A pool operator desiring a grant under
this section shall submit an application to the Secretary in
such manner, at such time, and containing such information as
the Secretary may require.
(4) Authorization of appropriations.--There are authorized
to be appropriated to the Secretary such sums as may be
necessary for making grants under this section.

SEC. 216. REPORT.

Not later than 1 year after the date of enactment of this
Act, the Secretary shall submit to Congress a report
containing recommendations for such legislative and
administrative changes as the Secretary determines are
appropriate to permit affinity groups related for reasons
other than a common employer to participate in purchasing
pools established under section 203.

SEC. 217. AUTHORIZATION OF APPROPRIATIONS.

(a) In General.--There are authorized to be appropriated,
such sums as may be necessary to carry out this title for
fiscal year 2006 and each fiscal year thereafter.
(b) Rule of Construction.--Amounts appropriated in
accordance with subsection (a) shall be in addition to other
amounts appropriated directly under this title and nothing in
subsection (a) shall be construed to relieve the Secretary of
mandatory payment obligations required under this title.

TITLE III--NATIONAL ADVISORY COMMISSION ON EXPANDED ACCESS TO HEALTH
CARE

SEC. 301. NATIONAL ADVISORY COMMISSION ON EXPANDED ACCESS TO
HEALTH CARE.

(a) Establishment.--Not later than October 1, 2003, the
Secretary of Health and Human Services (referred to in this
section as the ``Secretary''), shall establish an entity to
be known as the National Advisory Commission on Expanded
Access to Health Care (referred to in this section as the
``Commission'').
(b) Appointment of Members.--
(1) In general.--Not later than 45 days after the date of
enactment of this Act, the House and Senate Majority and
Minority Leaders shall each appoint 4 members of the
Commission and the Secretary shall appoint 1 member.
(2) Criteria.--Members of the Commission shall include
representatives of the following:
(A) Consumers of health insurance.
(B) Health care professionals.
(C) State officials.
(D) Economists.
(E) Health care providers.
(F) Experts on health insurance.
(G) Experts on expanding health care to individuals who are
uninsured.
(3) Chairperson.--At the first meeting of the Commission,
the Commission shall select a Chairperson from among its
members.
(c) Meetings.--
(1) In general.--After the initial meeting of the
Commission which shall be called by the Secretary, the
Commission shall meet at the call of the Chairperson.
(2) Quorum.--A majority of the members of the Commission
shall constitute a quorum, but a lesser number of members may
hold hearings.
(3) Supermajority voting requirement.--To approve a report
required under paragraph (2) or (3) of subsection (e), at
least 60 percent of the membership of the Commission must
vote in favor of such a report.
(d) Duties.--The Commission shall--
(1) assess the effectiveness of programs designed to expand
health care coverage or make health care coverage affordable
to the otherwise uninsured individuals through identifying
the accomplishments and needed improvements of each program;
(2) make recommendations about benefits and cost-sharing to
be included in health care coverage for various groups,
taking into account--
(A) the special health care needs of children and
individuals with disabilities;
(B) the different ability of various populations to pay
out-of-pocket costs for services;

[[Page S5963]]

(C) incentives for efficiency and cost-control; and
(D) preventative care, disease management services, and
other factors;
(3) recommend mechanisms to discourage individuals and
employers from voluntarily opting out of health insurance
coverage;
(4) recommend mechanisms to expand health care coverage to
uninsured individuals with incomes above 200 percent of the
official income poverty line (as defined by the Office of
Management and Budget, and revised annually in accordance
with section 673(2) of the Omnibus Budget Reconciliation Act
of 1981) applicable to a family of the size involved;
(5) recommend automatic enrollment and retention procedures
and other measures to increase health care coverage among
those eligible for assistance;
(6) review the roles, responsibilities, and relationship
between Federal and State agencies with respect to health
care coverage and recommend improvements; and
(7) analyze the size, effectiveness, and efficiency of
current tax and other subsidies for health care coverage and
recommend improvements.
(e) Reports.--
(1) Annual report.--The Commission shall submit annual
reports to the President and Congress addressing the matters
identified in subsection (d).
(2) Biennial report.--
(A) In general.--The Commission shall submit biennial
reports to the President and Congress, which shall contain--
(i) recommendations concerning essential benefits and
maximum out-of-pocket cost-sharing (for the general
population and for individuals with limited ability to pay,
which shall not exceed the out-of-pocket cost-sharing
permitted under section 2103(e) of the Social Security Act
(42 U.S.C. 1397cc(e))) for the coverage options described in
title II; and
(ii) proposed legislative language to implement such
recommendations.
(B) Congressional action.--The legislative language
proposed under subparagraph (A)(ii) shall proceed to
immediate consideration on the floor of the House of
Representatives and the Senate and shall be approved or
rejected, without amendment, using procedures employed for
recommendations of military base closing commissions.
(3) Commission report.--No later than January 15, 2007, the
Commission shall submit a report to the President and
Congress, which shall include--
(A) recommendations on policies to provide health care
coverage to uninsured individuals with incomes above 200
percent of the official income poverty line (as defined by
the Office of Management and Budget, and revised annually in
accordance with section 673(2) of the Omnibus Budget
Reconciliation Act of 1981) applicable to a family of the
size involved;
(B) recommendations on changes to policies enacted under
this Act; and
(C) proposed legislative language to implement such
recommendations.
(f) Administration.--
(1) Powers.--
(A) Hearings.--The Commission may hold such hearings, sit
and act at such times and places, take such testimony, and
receive such evidence as the Commission considers advisable
to carry out this section.
(B) Information from federal agencies.--The Commission may
secure directly from any Federal department or agency such
information as the Commission considers necessary to carry
out this section. Upon request of the Chairperson of the
Commission, the head of such department or agency shall
furnish such information to the Commission.
(C) Postal services.--The Commission may use the United
States mails in the same manner and under the same conditions
as other departments and agencies of the Federal Government.
(D) Gifts.--The Commission may accept, use, and dispose of
gifts or donations of services or property.
(2) Compensation.--While serving on the business of the
Commission (including travel time), a member of the
Commission shall be entitled to compensation at the per diem
equivalent of the rate provided for level IV of the Executive
Schedule under section 5315 of title 5, United States Code,
and while so serving away from home and the member's regular
place of business, a member may be allowed travel expenses,
as authorized by the chairperson of the Commission. All
members of the Commission who are officers or employees of
the United States shall serve without compensation in
addition to that received for their services as officers or
employees of the United States.
(3) Staff.--
(A) In general.--The Chairperson of the Commission may,
without regard to the civil service laws and regulations,
appoint and terminate an executive director and such other
additional personnel as may be necessary to enable the
Commission to perform its duties. The employment of an
executive director shall be subject to confirmation by the
Commission.
(B) Staff compensation.--The Chairperson of the Commission
may fix the compensation of the executive director and other
personnel without regard to chapter 51 and subchapter III of
chapter 53 of title 5, United States Code, relating to
classification of positions and General Schedule pay rates,
except that the rate of pay for the executive director and
other personnel may not exceed the rate payable for level V
of the Executive Schedule under section 5316 of such title.
(C) Detail of government employees.--Any Federal Government
employee may be detailed to the Commission without
reimbursement, and such detail shall be without interruption
or loss of civil service status or privilege.
(D) Procurement of temporary and intermittent services.--
The Chairperson of the Commission may procure temporary and
intermittent services under section 3109(b) of title 5,
United States Code, at rates for individuals which do not
exceed the daily equivalent of the annual rate of basic pay
prescribed for level V of the Executive Schedule under
section 5316 of such title.
(g) Termination.--Except with respect to activities in
connection with the ongoing biennial report required under
subsection (e)(2), the Commission shall terminate 90 days
after the date on which the Commission submits the report
required under subsection (e)(3).
(h) Authorization of Appropriations.--There are authorized
to be appropriated, such sums as may be necessary to carry
out this section for fiscal year 2004 and each fiscal year
thereafter.

SEC. 302. CONGRESSIONAL ACTION.

(a) Bill Introduction.--
(1) In general.--Any legislative language included in the
report required under section 301(e)(3) may be introduced as
a bill by request in the following manner:
(A) House of representatives.--In the House of
Representatives, by the Majority Leader and the Minority
Leader not later than 10 days after receipt of the
legislative language.
(B) Senate.--In the Senate, by the Majority Leader and the
Minority Leader not later than 10 days after receipt of the
legislative language.
(2) Alternative by administration.--The President may
submit legislative language based on the recommendations of
the Commission and such legislative language may be
introduced in the manner described in paragraph (1).
(b) Committee Consideration.--
(1) In general.--Any legislative language submitted
pursuant to paragraph (1) or (2) of subsection (a) (in this
section referred to as ``implementing legislation'') shall be
referred to the appropriate committees of the House of
Representatives and the Senate.
(2) Reporting.--
(A) Committee action.--If, not later than 150 days after
the date on which the implementing legislation is referred to
a committee under paragraph (1), the committee has reported
the implementing legislation or has reported an original bill
whose subject is related to reforming the health care system,
or to providing access to affordable health care coverage for
Americans, the regular rules of the applicable House of
Congress shall apply to such legislation.
(B) Discharge from committees.--
(i) Senate.--

(I) In general.--If the implementing legislation or an
original bill described in subparagraph (A) has not been
reported by a committee of the Senate within 180 days after
the date on which such legislation was referred to committee
under paragraph (1), it shall be in order for any Senator to
move to discharge the committee from further consideration of
such implementing legislation.
(II) Sequential referrals.--Should a sequential referral of
the implementing legislation be made, the additional
committee has 30 days for consideration of implementing
legislation before the discharge motion described in
subclause (I) would be in order.
(III) Procedure.--The motion described in subclause (I)
shall not be in order after the implementing legislation has
been placed on the calendar. While the motion described in
subclause (I) is pending, no other motions related to the
motion described in subclause (I) shall be in order. Debate
on a motion to discharge shall be limited to not more than 10
hours, equally divided and controlled by the Majority Leader
and the Minority Leader, or their designees. An amendment to
the motion shall not be in order, nor shall it be in order to
move to reconsider the vote by which the motion is agreed or
disagreed to.
(IV) Exception.--If implementing language is submitted on a
date later than May 1 of the second session of a Congress,
the committee shall have 90 days to consider the implementing
legislation before a motion to discharge under this clause
would be in order.

(ii) House of representatives.--If the implementing
legislation or an original bill described in subparagraph (A)
has not been reported out of a committee of the House of
Representatives within 180 days after the date on which such
legislation was referred to committee under paragraph (1),
then on any day on which the call of the calendar for motions
to discharge committees is in order, any member of the House
of Representatives may move that the committee be discharged
from consideration of the implementing legislation, and this
motion shall be considered under the same terms and
conditions, and if adopted the House of Representatives shall
follow the procedure described in subsection (c)(1).
(c) Floor Consideration.--
(1) Motion to proceed.--If a motion to discharge made
pursuant to subsection (b)(2)(B)(i) or (b)(2)(B)(ii) is
adopted, then, not earlier than 5 legislative days after the
date on which the motion to discharge is

[[Page S5964]]

adopted, a motion may be made to proceed to the bill.
(2) Failure of motion.--If the motion to discharge made
pursuant to subsection (b)(2)(B)(i) or (b)(2)(B)(ii) fails,
such motion may be made not more than 2 additional times, but
in no case more frequently than within 30 days of the
previous motion. Debate on each of such motions shall be
limited to 5 hours, equally divided.
(3) Applicable rules.--Once the Senate is debating the
implementing legislation the regular rules of the Senate
shall apply.

TITLE IV--STATE WAIVERS

SEC. 401. STATE WAIVERS.

(a) In General.--Notwithstanding any other provision of
law, a State may apply to the Secretary of Health and Human
Services for waivers of such provisions of law as may be
necessary for the State to implement policies that make
comprehensive, affordable health coverage available for all
State residents, including access to essential benefits with
limits on cost-sharing, as provided in the most recent report
under section 301(e)(2).
(b) Requirements.--In order to ensure that waivers under
this section benefit rather than harm health care consumers,
a State shall not be eligible for a waiver under this section
unless--
(1) the State reasonably expects to achieve a level of
enrollment in coverage described in subsection (a) that is at
least equal to the level of coverage (taking into account the
number of insured individuals, covered benefits, and premium
and out-of-pocket costs to the consumer for such coverage)
that the State would have achieved if the State had fully
implemented the coverage options available under titles I and
II of this Act;
(2) no individual who would have qualified for assistance
under the State medicaid program under title XIX of the
Social Security Act or the State children's health insurance
program under title XXI of such Act, as of either the date of
the waiver request or the date of enactment of this Act, will
be denied eligibility for such program, have a reduction in
benefits under such program, have reduced access to
geographically and linguistically appropriate care or
essential community providers, or be subject to increased
premiums or cost-sharing under the waiver program under this
section; and
(3) the State agrees to comply with such standards or
guidelines as the Secretary of Health and Human Services may
require to ensure that the requirements of paragraphs (1) and
(2) are satisfied.
(c) Federal Payments.--
(1) In general.--The Secretary of Health and Human Services
shall pay a State with a waiver approved under this section
an amount each quarter equal to the sum of--
(A) the Federal payments the State and residents of the
State (including, but not limited to, through the credit
allowed under section 36 of the Internal Revenue Code of 1986
for health insurance costs) would have received if the State
had exercised the coverage options under titles I and II of
this Act with respect to residents of the State who have not
attained age 65; and
(B) the amount of any grants authorized by this Act that
the State would have received if the State had applied for
such grants.
(2) Additional payment for medicare beneficiaries under age
65.--
(A) In general.--In the case of a State that elects to
enroll an individual described in subparagraph (B) in
coverage described in subsection (a), the amount described in
paragraph (1) with respect to a quarter shall be increased by
the amount described in subparagraph (C).
(B) Individual described.--An individual is described in
this subparagraph if the individual--
(i) has not attained age 65;
(ii) is eligible for coverage under title XVIII of the
Social Security Act; and
(iii) voluntarily elects to enroll in coverage described in
subsection (a).
(C) Amount described.--The amount described in this
subparagraph is the amount equal to the amount that the
Federal Government would have incurred with respect to a
quarter for providing coverage to an individual described in
subparagraph (B) under title XVIII of the Social Security Act
(42 U.S.C. 1395 et seq.).
(d) Implementation Date.--No State may submit a request for
a waiver under this section before October 1, 2007.
______

By Mr. SARBANES (for himself, Mr. Alexander, Mr. Akaka, Mr.
Baucus, Mr. Corzine, Mr. Dodd, Mr. Graham of Florida, Mr.
Kennedy, Mr. Lautenberg, Mr. Levin, Mr. Reid, Mr. Schumer, Ms.
Stabenow, and Mr. Wyden):
S. 1032. A bill to provide for alternative transportation in certain
federally owned or managed areas that are open to the general public;
to the Committee on Energy and Natural Resources.
Mr. SARBANES. Mr. President, I rise today to introduce legislation
similar to measures I have introduced in previous Congresses that will
help protect our Nation's natural resources and improve the visitor
experience in our national parks and other public lands. The Transit in
Parks Act, or ``TRIP,'' establishes a new Federal transit grant
initiative to support the development of alternative transportation
services for our national parks, wildlife refuges, Federal recreational
areas, and other public lands. I am pleased to be joined by Senators
Akaka, Alexander, Baucus, Corzine, Dodd, Graham, Kennedy, Lautenberg,
Levin, Reid, Schumer, Stabenow, and Wyden, who are cosponsors of this
legislation.
I want to underscore again today some of the principal arguments I
have made in past years as to why this legislation is urgently needed.
Memorial Day weekend, the opening of the summer travel season, is just
weeks away. Millions of visitors will soon head to our national parks
to enjoy the incredible natural heritage with which our Nation was
endowed. But too many of them will spend hours looking for parking, or
staring at the bumper of the car in front of them.
Clearly, the world has changed significantly since the national parks
first opened in the second half of the nineteenth century, when
visitors arrived by stagecoach along dirt roads. At that time, travel
through parklands, such as Yosemite or Yellowstone, was long,
difficult, and costly. Not many people could afford or endure such a
trip. The introduction of the automobile gave every American greater
mobility and freedom, which included the freedom to travel and see some
of our Nation's great natural wonders. Early in this century, landscape
architects from the National Park Service and highway engineers from
the U.S. Bureau of Public Roads collaborated to produce many feats of
road engineering that opened the national park lands to millions of
Americans.
Yet greater mobility and easier access now threaten the very
environments that the National Park Service is mandated to protect. The
ongoing tension between preservation and access has always been a
challenge for our national park system. Today, record numbers of
visitors and cars have resulted in increasing damage to our parks. The
Grand Canyon alone has almost five million visitors a year. As many as
6,000 vehicles arrive in a single summer day. They compete for 2,400
parking spaces. Between 32,000 and 35,000 tour buses go to the park
each year. During the peak summer season, the entrance route becomes a
giant parking lot.
In 1975, the total number of visitors to America's national parks was
190 million. By 2002, that number had risen to 277 million annual
visitors--almost equal to one visit by every man, woman, and child in
this country. This dramatic increase in visitation has created an
overwhelming demand on these areas, resulting in severe traffic
congestion, visitor restrictions, and in some instances vacationers
being shut out of the parks altogether. The environmental damage at the
Grand Canyon is visible at many other parks: Yosemite, which has more
than four million visitors a year; Yellowstone, which has more than
three million visitors a year and experiences such severe traffic
congestion that access has to be restricted; Zion; Acadia; Bryce; and
many others. We need to solve these problems now or risk permanent harm
to our nation's natural, cultural, and historical heritage.
Visitor access to the parks is vital not only to the parks
themselves, but to the economic health of their gateway communities.
For example, visitors to Yosemite infuse $3 billion a year into the
local economy of the surrounding area. At Yellowstone, tourists spend
$725 million annually in adjacent communities. Wildlife-related tourism
generates an estimated $60 billion a year nationwide. If the parks are
forced to close their gates to visitors due to congestion, the economic
vitality of the surrounding region would be jeopardized.
The challenge for park management has always been twofold: to
conserve and protect the nation's natural, historical, and cultural
resources, while at the same time ensuring visitor access and enjoyment
of these sensitive environments. Until now, the principal
transportation systems that the Federal Government has developed to
provide access into our national parks are roads, primarily for private
automobile access. The TRIP legislation recognizes that we need to do
more than simply

[[Page S5965]]

build roads; we must invest in alternative transportation solutions
before our national parks are damaged beyond repair.
In developing solutions to the parks' transportation needs, this
legislation builds upon the 1997 Memorandum of Understanding between
Secretary of Transportation Rodney Slater and Secretary of the Interior
Bruce Babbitt, in which the two Departments agreed to work together to
address transportation and resource management needs in and around
national parks. The findings in the MOU are especially revealing:
Congestion in and approaching many National Parks is causing lengthy
traffic delays and backups that substantially detract from the visitor
experience. Visitors find that many of the National Parks contain
significant noise and air pollution, and traffic congestion similar to
that found on the city streets they left behind.
In many National Park units, the capacity of parking facilities at
interpretive or scenic areas is well below demand. As a result,
visitors park along roadsides, damaging park resources and subjecting
people to hazardous safety conditions as they walk near busy roads to
access visitor use areas.
On occasion, National Park units must close their gates during high
visitation periods and turn away the public because the existing
infrastructure and transportation systems are at, or beyond, the
capacity for which they were designed.
In addition, the TRIP legislation is designed to implement the
recommendations from a comprehensive study of alternative
transportation needs in public lands that I was able to include in the
Transportation Equity Act for the 21st Century, TEA-21, as section
3039. The Federal Lands Alternative Transportation Systems Study
confirmed what those of us who have visited our national parks already
know: there is a significant and well-documented need for alternative
transportation solutions in the national parks to prevent lasting
damage to these incomparable natural treasures.
The study examined over two hundred sites, and identified needs for
alternative transportation services at two-thirds of those sites. The
study found that implementation of such services can help achieve a
number of desirable outcomes: ``Relieve traffic congestion and parking
shortages; enhance visitor mobility and accessibility; preserve
sensitive natural, cultural, and historic resources; provide improved
interpretation, education and visitor information services; reduce
pollution; and improve economic development opportunities for gateway
communities.''
In fact, the study concluded that ``the provision of transit in
federally-managed lands can have national economic implications as well
as significant economic benefits for local areas surrounding the
sites.'' The study determined that funding transit needs would support
thousands of jobs around the country, while also providing a direct
benefit to the economy of gateway communities by ``expand[ing] the
number of visits to the site and expand[ing] the amount of visitor
spending in the surrounding communities.''
The study identified ``lack of a dedicated funding source for
developing, implementing, and operating and maintaining transit
systems'' as a key barrier to implementation of alternative
transportation in and around federally-managed lands. The Transit in
Parks Act will go far toward helping parks and their gateway
communities overcome this barrier. This new Federal transit grant
program will provide funding to the Federal land management agencies
that manage the 388 various sites within the National Park System, the
National Wildlife Refuges, Federal recreational areas, and other public
lands, including National Forest System lands, and to their State and
local partners.
The bill's objectives are to develop new and expanded transit
services throughout the national parks and other public lands to
conserve and protect fragile natural, cultural, and historical
resources and wildlife habitats, to prevent or mitigate adverse impact
on those resources and habitats, and to reduce pollution and
congestion, while at the same time facilitating appropriate visitor
access and improving the visitor experience. The program will provide
capital funds for transit projects, including rail or clean fuel bus
projects, joint development activities, pedestrian and bike paths, or
park waterway access, within or adjacent to national parks and other
public lands. The Secretary of Transportation may make funds available
for operations as well. The bill authorizes $90 million for this new
program for each of the fiscal years 2004 through 2009, consistent with
the level of need identified in the study. It is anticipated that other
resources--both public and private--will be available to augment these
amounts.
The bill formalizes the cooperative arrangement in the 1997 MOU
between the Secretary of Transportation and the Secretary of the
Interior to exchange technical assistance and to develop procedures
relating to the planning, selection and funding of transit projects in
national park lands. The bill further provides funds for planning,
research, and technical assistance that can supplement other financial
resources available to the Federal land management agencies. The
projects eligible for funding would be developed through the
transportation planning process and prioritized for funding by the
Secretary of the Interior in consultation and cooperation with the
Secretary of Transportation. It is anticipated that the Secretary of
the Interior would select projects that are diverse in location and
size. While major national parks such as the Grand Canyon or
Yellowstone are clearly appropriate candidates for significant transit
projects under this section, there are numerous small urban and rural
Federal park lands that can benefit enormously from small projects,
such as bike paths or improved connections with an urban or regional
public transit system. No single project will receive more than 12
percent of the total amount available in any given year. This ensures a
diversity of projects selected for assistance.
In addition, I firmly believe that this program will create new
opportunities for the Federal land management agencies to partner with
local transit agencies in gateway communities adjacent to the parks,
both through the TEA-21 planning process and in developing integrated
transportation systems. This will spur new economic development within
these communities, as they develop transportation centers for park
visitors to connect to transit links into the national parks and other
public lands.
The ongoing tension between preservation and access has always been a
challenge for the National Park Service. Today, that challenge has new
dimensions, with overcrowding, pollution, congestion, and resource
degradation increasing at many of our national parks. This
legislation--the Transit in Parks Act--will give our Federal land
management agencies important new tools to improve both preservation
and access. Just as we have found in metropolitan areas, transit is
essential to moving large numbers of people in our national parks--
quickly, efficiently, at low cost, and without adverse impact. At the
same time, transit can enhance the economic development potential of
our gateway communities.
As we begin a new millennium, I cannot think of a more worthy
endeavor to help our environment and preserve our national parks,
wildlife refuges, and Federal recreational areas than by encouraging
alternative transportation in these areas. My bill is strongly
supported by the National Parks Conservation Association, Environmental
Defense, the American Public Transportation Association, Community
Transportation Association, Amalgamated Transit Union, Surface
Transportation Policy Project, Natural Resources Defense Council,
Friends of the Earth, Rails-to-Trails Conservancy, America Bikes and
others, and I ask unanimous consent that the bill, a section-by-section
analysis, and letters of support be printed in the Record, along with
the USA Today article, ``Save Parks: Park Cars.''
I believe that we have a clear choice before us: we can turn paradise
into a parking lot--or we can invest in alternatives. I urge my
colleagues to support the Transit in Parks Act to ensure that our
Nation's natural treasures will be preserved for many generations to
come.
______

By Mr. BINGAMAN (for himself, Mr. Lugar, Mrs. Lincoln, Mr.

[[Page S5966]]

Corzine, Ms. Landrieu, Mr. Breaux, Mr. Kerry, Ms. Cantwell,
Mrs. Murray, Mrs. Clinton, and Mr. Miller):
S. 1033. A bill to amend titles XIX and XXI of the Social Security
Act to expand or add coverage of pregnant women under the medicaid and
State children's health insurance program, and for other purposes; to
the Committee on Finance.
Mr. BINGAMAN. Mr. President, I rise today to introduce bipartisan
legislation with Senators Lugar, Lincoln, Corzine, Landrieu, Breaux,
Kerry, Murray, Cantwell, Clinton, and Miller. This legislation,
entitled the ``Start Healthy, Stay Healthy Act of 2003,'' would
significantly reduce the number of uninsured pregnant women and
newborns by expanding coverage to pregnant women through Medicaid and
the Children's Health Insurance Program, or CHIP, and to newborns
through the first full year of life.
Sunday is Mothers' Day. Every year, we honor our Nation's mothers and
we should take the time to assess how we can do better by them,
including their health and well-being.
According to a recent report by Save the Children entitled ``The
State of the World's Mothers,'' the United States fares no better than
11th in the world. Why is this? According to the report, ``The United
States earned its 11th place rank this year based on several factors:
One of the key indicators used to calculate the well-being for mothers
is lifetime risk of maternal mortality . . . Canada, Australia, and all
the Western and Northern European countries in the study performed
better than the United States in this indicator.''
The study adds, ``Similarly, the United States did not do as well as
the top 10 countries with regard to infant mortality rates.''
In fact, the United States ranks 21st in maternal mortality and 28th
in infant mortality, the worst among developed nations. We should and
must do better by our Nation's mothers and infants.
Throughout our Nation's history, there has been long-standing policy
linking programs for pregnant women and infants, including Medicaid,
WIC, and the Maternal and Child Health Block Grant. CHIP,
unfortunately, fails to provide coverage to pregnant women beyond the
age of 18. As a result, it is more likely that newborns eligible for
CHIP are not covered from the moment of birth, and therefore, often
miss having comprehensive prenatal care and those first critical months
of life until their CHIP application is processed.
By expanding coverage to pregnant women through CHIP, the ``Start
Healthy, Stay Healthy Act'' recognizes the importance of prenatal care
to the health and development of a child. As Dr. Alan Waxman of the
University of New Mexico School of Medicine has written, ``Prenatal
care is an important factor in the prevention of birth defects and the
prevention of prematurity, the most common causes of infant death and
disability. Babies born to women with no prenatal care or late prenatal
care are nearly twice as likely to [be] low birthweight or very low
birthweight as infants born to women who received early prenatal
care.''
Unfortunately, according to the Centers for Disease Control and
Prevention, New Mexico ranked worst in the Nation in the percentage of
mothers receiving late or no prenatal care last year. The result is
often quite costly--both in terms of the health of the mother and
newborn but also in terms of the long-term expenses since the result
can be chronic, lifelong health problems.
In fact, according to the Agency for Healthcare Research and Quality,
``four of the top 10 most expensive conditions in the hospital are
related to care of infants with complications (respiratory distress,
prematurity, heart defects, and lack of oxygen).'' As a result, in
addition to reduced infant mortality and morbidity, the provision to
expand coverage to pregnant women can be cost effective.
The ``Start Healthy, Stay Healthy Act'' also eliminates the
unintended federal policy through CHIP that covers pregnant women only
through the age of 18 and cuts off that coverage once the women turn 19
years of age. Certainly, everybody can agree that the government should
not be telling women that they are more likely to receive prenatal care
coverage only if they become pregnant as a teenager.
This bipartisan legislation has previously received or has added
endorsements from the following organizations: the March of Dimes, The
American Academy of Pediatrics, the American College of Obstetricians
and Gynecologists, the What to Expect Foundation, the American Academy
of Family Physicians, the American Academy of Pediatric Dentistry, the
American Academy of Child and Adolescent Psychiatry, the National
Association of Community Health Centers, the American Hospital
Association, the National Association of Children's Hospitals, the
Federation of American Health Systems, the National Association of
Public Hospitals and Health Systems, Premier, Catholic Health
Association, Catholic Charities USA, Family Voices, the Association of
Maternal and Child Health Programs, the National Health Law Program,
the National Association of Social Workers, Every Child By Two, the
United Cerebral Palsy Associations, the Society for Maternal-Fetal
Medicine, and Families USA.
This legislation is a reintroduction of a bill that was introduced in
2001. Throughout that year, the Administration made numerous statements
in support of the passage of this type of legislation, but
unfortunately, reversed course in October 2002 after publishing a
regulation allowing states to redefine a ``child'' as an ``unborn
child'' and to provide prenatal care through CHIP in that manner. In a
letter to Senator Nickles dated October 8, 2002, Secretary Thompson
argued, ``I believe the regulation is a more effective and
comprehensive solution to this issue.''
While a number of senators strongly disagreed with Secretary
Thompson's assertion and sent him letters to that effect on October 10,
2002, and on October 23, 2002, we felt it was important to get the
testimony of our Nation's medical experts on the health and well-being
of both pregnant women and newborns. We called for a hearing in the
Senate Health, Education, Labor and Pensions Committee on October 24,
2002. Witnesses included representatives from the March of Dimes, the
American College of Obstetricians and Gynecologists, the American
Academy of Pediatrics, and the What to Expect Foundation. They were
asked to compare the regulation to the legislation and I will let their
testimony speak for itself.
Dr. Nancy Green testified on behalf of the March of Dimes Birth
Defects Foundation. She said:

We support giving states the flexibility they need to cover
income-eligible pregnant women age 19 and older, and to
automatically enroll infants born to SCHIP-eligible mothers.
By establishing a uniform eligibility threshold for coverage
for pregnant women and infants, states will be able to
improve maternal health, eliminate waiting periods for
infants and streamline administration of publicly supported
health programs. Currently, according to the Department of
Health and Human Services' Centers for Medicare and Medicaid
Services and the National Governors' Association, 36 states
and the District of Columbia have income eligibility
thresholds that are more restrictive for women than for their
newborns. Encouraging states to eliminate this disparity by
allowing them to establish a uniform eligibility threshold
for pregnant women and their infants should be a national
policy priority.

Dr. Green adds:

Specifically, we are deeply concerned that final regulation
fails to provide to the mother the standard scope of
maternity care services recommended by the American College
of Obstetricians and Gynecologists (ACOG) and the American
Academy of Pediatrics (AAP). Of particular concern, the
regulation explicitly states that postpartum care is not
covered and, therefore, federal reimbursement will not be
available for these services. In addition, because of the
contentious collateral issues raised by this regulation
groups like the March of Dimes will find it even more
difficult to work in the states to generate support for
legislation to extend coverage to uninsured pregnant women.

Dr. Laura Riley testified on behalf of ACOG. In her testimony, she
stated:

ACOG is very concerned that mothers will not have access to
postpartum services under the regulation. The rule clearly
states that ``. . . care after delivery, such as postpartum
services could not be covered as part of the Title XXI State
Plan . . . because they are not services for an eligible
child.''

On the importance of postpartum care, Dr. Riley adds:

[[Page S5967]]

When new mothers develop postpartum complications, quick
access to their physicians is absolutely critical. Postpartum
care is especially important for women who have preexisting
medical conditions, and for those whose medical conditions
were induced by their pregnancies, such as gestational
diabetes or hypertension, and for whom it is necessary to
ensure that their conditions are stabilized and treated.

As a result, Dr. Riley concludes:

Limiting coverage to the fetus instead of the mother omits
a critical component of postpartum care that physicians
regard as essential for the health of the mother and the
child. Covering the fetus as opposed to the mother also
raises questions of whether certain services will be
available during pregnancy and labor if the condition is one
that more directly affects the woman. The best way to address
this coverage issue is to pass S. 724, supported by Senators
Bond, Bingaman and Lincoln and many others, and which
provides a full range of medical services during and after
pregnancy directly to the pregnant woman.

Dr. Richard Bucciarelli testified on behalf of the American Academy
of Pediatrics. He said:

Recently, the Administration published a final rule
expanding SCHIP cover unborn children. The Academy is
concerned that, as written, this regulation falls dangerously
short of the clinical standards of care outlined in our
guidelines, which describe the importance of covering all
stages of a birth--pregnancy, delivery, and postpartum care.

It is important to note that the regulation subtracts the time that
an ``unborn child'' is covered from the period of continuously
eligibility after birth. Consequently, children would be denied
insurance coverage at very critical points during the first full year
of life. As such, Dr. Bucciarelli expressed support for the legislation
over the regulation because it, in his words:

. . . takes an important step to decrease the number of
uninsured children by providing 12 months of continuous
eligibility for those children born. . . . This legislation
ensures that children born to women enrolled in Medicaid or
SCHIP are immediately enrolled in the program for which they
are eligible. Additionally, this provision prevents newborns
eligible for SCHIP from being subject to enrollment waiting
periods, ensuring that infants receive appropriate health
care in their first year of life.

And finally, Lisa Bernstein testified as Executive Director of The
What to Expect Foundation, which takes its name from the bestselling
What to Expect pregnancy and parenting series that has helped over 20
million families from pregnancy through their child's toddler years.
Ms. Bernstein also supported the legislation as a far superior option
over the regulation and make this simple but eloquent point:

. . . only a healthy parent can provide a healthy future
for a healthy child.

The testimony of these experts speak for themselves and I urge my
colleagues to pass this legislation as soon as possible.
I ask unanimous consent that the text of the bill and a series of
letters be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

S. 1033

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 ``Start Healthy, Stay Healthy
Act of 2003''.

SEC. 2. STATE OPTION TO EXPAND OR ADD COVERAGE OF CERTAIN
PREGNANT WOMEN UNDER MEDICAID AND SCHIP.

(a) Medicaid.--
(1) Authority to expand coverage.--Section 1902(l)(2)(A)(i)
of the Social Security Act (42 U.S.C. 1396a(l)(2)(A)(i)) is
amended by inserting ``(or such higher percent as the State
may elect for purposes of expenditures for medical assistance
for pregnant women described in section 1905(u)(4)(A))''
after ``185 percent''.
(2) Enhanced matching funds available if certain conditions
met.--Section 1905 of the Social Security Act (42 U.S.C.
1396d) is amended--
(A) in the fourth sentence of subsection (b), by striking
``or subsection (u)(3)'' and inserting ``, (u)(3), or
(u)(4)''; and
(B) in subsection (u)--
(i) by redesignating paragraph (4) as paragraph (5); and
(ii) by inserting after paragraph (3) the following:
``(4) For purposes of the fourth sentence of subsection (b)
and section 2105(a), the expenditures described in this
paragraph are the following:
``(A) Certain pregnant women.--If the conditions described
in subparagraph (B) are met, expenditures for medical
assistance for pregnant women described in subsection (n) or
under section 1902(l)(1)(A) in a family the income of which
exceeds the effective income level (expressed as a percent of
the poverty line and considering applicable income
disregards) that has been specified under subsection
(a)(10)(A)(i)(III) or (l)(2)(A) of section 1902, as of
January 1, 2003, but does not exceed the income eligibility
level established under title XXI for a targeted low-income
child.
``(B) Conditions.--The conditions described in this
subparagraph are the following:
``(i) The State plans under this title and title XXI do not
provide coverage for pregnant women described in subparagraph
(A) with higher family income without covering such pregnant
women with a lower family income.
``(ii) The State does not apply an effective income level
for pregnant women that is lower than the effective income
level (expressed as a percent of the poverty line and
considering applicable income disregards) that has been
specified under the State plan under subsection
(a)(10)(A)(i)(III) or (l)(2)(A) of section 1902, as of
January 1, 2003, to be eligible for medical assistance as a
pregnant woman.
``(C) Definition of poverty line.--In this subsection, the
term `poverty line' has the meaning given such term in
section 2110(c)(5).''.
(3) Payment from title xxi allotment for medicaid expansion
costs; elimination of counting medicaid child presumptive
eligibility costs against title xxi allotment.--Section
2105(a)(1) of the Social Security Act (42 U.S.C.
1397ee(a)(1)) is amended--
(A) in the matter preceding subparagraph (A), by striking
``(or, in the case of expenditures described in subparagraph
(B), the Federal medical assistance percentage (as defined in
the first sentence of section 1905(b)))''; and
(B) by striking subparagraph (B) and inserting the
following:
``(B) for the provision of medical assistance that is
attributable to expenditures described in section
1905(u)(4)(A);''.
(4) Additional amendments to medicaid.--
(A) Eligibility of a newborn.--Section 1902(e)(4) of the
Social Security Act (42 U.S.C. 1396a(e)(4)) is amended in the
first sentence by striking ``so long as the child is a member
of the woman's household and the woman remains (or would
remain if pregnant) eligible for such assistance''.
(B) Application of qualified entities to presumptive
eligibility for pregnant women under medicaid.--Section
1920(b) of the Social Security Act (42 U.S.C. 1396r-1(b)) is
amended by adding at the end after and below paragraph (2)
the following flush sentence:

``The term `qualified provider' includes a qualified entity
as defined in section 1920A(b)(3).''.
(b) SCHIP.--
(1) Coverage.--Title XXI of the Social Security Act (42
U.S.C. 1397aa et seq.) is amended by adding at the end the
following:

``SEC. 2111. OPTIONAL COVERAGE OF TARGETED LOW-INCOME
PREGNANT WOMEN.

``(a) Optional Coverage.--Notwithstanding any other
provision of this title, a State may provide for coverage,
through an amendment to its State child health plan under
section 2102, of pregnancy-related assistance for targeted
low-income pregnant women in accordance with this section,
but only if the State meets the conditions described in
section 1905(u)(4)(B).
``(b) Definitions.--For purposes of this title:
``(1) Pregnancy-related assistance.--The term `pregnancy-
related assistance' has the meaning given the term child
health assistance in section 2110(a) as if any reference to
targeted low-income children were a reference to targeted
low-income pregnant women, except that the assistance shall
be limited to services related to pregnancy (which include
prenatal, delivery, and postpartum services and services
described in section 1905(a)(4)(C)) and to other conditions
that may complicate pregnancy.
``(2) Targeted low-income pregnant woman.--The term
`targeted low-income pregnant woman' means a woman--
``(A) during pregnancy and through the end of the month in
which the 60-day period (beginning on the last day of her
pregnancy) ends;
``(B) whose family income exceeds the effective income
level (expressed as a percent of the poverty line and
considering applicable income disregards) that has been
specified under subsection (a)(10)(A)(i)(III) or (l)(2)(A) of
section 1902, as of January 1, 2003, to be eligible for
medical assistance as a pregnant woman under title XIX but
does not exceed the income eligibility level established
under the State child health plan under this title for a
targeted low-income child; and
``(C) who satisfies the requirements of paragraphs (1)(A),
(1)(C), (2), and (3) of section 2110(b).
``(c) References to Terms and Special Rules.--In the case
of, and with respect to, a State providing for coverage of
pregnancy-related assistance to targeted low-income pregnant
women under subsection (a), the following special rules
apply:
``(1) Any reference in this title (other than in subsection
(b)) to a targeted low-income child is deemed to include a
reference to a targeted low-income pregnant woman.
``(2) Any such reference to child health assistance with
respect to such women is deemed a reference to pregnancy-
related assistance.

[[Page S5968]]

``(3) Any such reference to a child is deemed a reference
to a woman during pregnancy and the period described in
subsection (b)(2)(A).
``(4) In applying section 2102(b)(3)(B), any reference to
children found through screening to be eligible for medical
assistance under the State medicaid plan under title XIX is
deemed a reference to pregnant women.
``(5) There shall be no exclusion of benefits for services
described in subsection (b)(1) based on any preexisting
condition and no waiting period (including any waiting period
imposed to carry out section 2102(b)(3)(C)) shall apply.
``(6) Subsection (a) of section 2103 (relating to required
scope of health insurance coverage) shall not apply insofar
as a State limits coverage to services described in
subsection (b)(1) and the reference to such section in
section 2105(a)(1)(C) is deemed not to require, in such case,
compliance with the requirements of section 2103(a).
``(7) In applying section 2103(e)(3)(B) in the case of a
pregnant woman provided coverage under this section, the
limitation on total annual aggregate cost-sharing shall be
applied to the entire family of such pregnant woman.
``(d) Automatic Enrollment for Children Born to Women
Receiving Pregnancy-Related Assistance.--If a child is born
to a targeted low-income pregnant woman who was receiving
pregnancy-related assistance under this section on the date
of the child's birth, the child shall be deemed to have
applied for child health assistance under the State child
health plan and to have been found eligible for such
assistance under such plan or to have applied for medical
assistance under title XIX and to have been found eligible
for such assistance under such title, as appropriate, on the
date of such birth and to remain eligible for such assistance
until the child attains 1 year of age. During the period in
which a child is deemed under the preceding sentence to be
eligible for child health or medical assistance, the child
health or medical assistance eligibility identification
number of the mother shall also serve as the identification
number of the child, and all claims shall be submitted and
paid under such number (unless the State issues a separate
identification number for the child before such period
expires).''.
(2) Additional allotments for providing coverage of
pregnant women.--
(A) In general.--Section 2104 of the Social Security Act
(42 U.S.C. 1397dd) is amended by inserting after subsection
(c) the following:
``(d) Additional Allotments for Providing Coverage of
Pregnant Women.--
``(1) Appropriation; total allotment.--For the purpose of
providing additional allotments to States under this title,
there is appropriated, out of any money in the Treasury not
otherwise appropriated, for each of fiscal years 2004 through
2007, $200,000,000.
``(2) State and territorial allotments.--In addition to the
allotments provided under subsections (b) and (c), subject to
paragraphs (3) and (4), of the amount available for the
additional allotments under paragraph (1) for a fiscal year,
the Secretary shall allot to each State with a State child
health plan approved under this title--
``(A) in the case of such a State other than a commonwealth
or territory described in subparagraph (B), the same
proportion as the proportion of the State's allotment under
subsection (b) (determined without regard to subsection (f))
to the total amount of the allotments under subsection (b)
for such States eligible for an allotment under this
paragraph for such fiscal year; and
``(B) in the case of a commonwealth or territory described
in subsection (c)(3), the same proportion as the proportion
of the commonwealth's or territory's allotment under
subsection (c) (determined without regard to subsection (f))
to the total amount of the allotments under subsection (c)
for commonwealths and territories eligible for an allotment
under this paragraph for such fiscal year.
``(3) Use of additional allotment.--Additional allotments
provided under this subsection are not available for amounts
expended before October 1, 2003. Such amounts are available
for amounts expended on or after such date for child health
assistance for targeted low-income children, as well as for
pregnancy-related assistance for targeted low-income pregnant
women.
``(4) No payments unless election to expand coverage of
pregnant women.--No payments may be made to a State under
this title from an allotment provided under this subsection
unless the State provides pregnancy-related assistance for
targeted low-income pregnant women under this title, or
provides medical assistance for pregnant women under title
XIX, whose family income exceeds the effective income level
applicable under subsection (a)(10)(A)(i)(III) or (l)(2)(A)
of section 1902 to a family of the size involved as of
January 1, 2003.''.
(B) Conforming amendments.--Section 2104 of the Social
Security Act (42 U.S.C. 1397dd) is amended--
(i) in subsection (a), in the matter preceding paragraph
(1), by inserting ``subject to subsection (d),'' after
``under this section,'';
(ii) in subsection (b)(1), by inserting ``and subsection
(d)'' after ``Subject to paragraph (4)''; and
(iii) in subsection (c)(1), by inserting ``subject to
subsection (d),'' after ``for a fiscal year,''.
(3) Presumptive eligibility under title xxi.--
(A) Application to pregnant women.--Section 2107(e)(1)(D)
of the Social Security Act (42 U.S.C. 1397gg(e)(1)) is
amended to read as follows:
``(D) Sections 1920 and 1920A (relating to presumptive
eligibility).''.
(B) Exception from limitation on administrative expenses.--
Section 2105(c)(2) of the Social Security Act (42 U.S.C.
1397ee(c)(2)) is amended by adding at the end the following
new subparagraph:
``(C) Exception for presumptive eligibility expenditures.--
The limitation under subparagraph (A) on expenditures shall
not apply to expenditures attributable to the application of
section 1920 or 1920A (pursuant to section 2107(e)(1)(D)),
regardless of whether the child or pregnant woman is
determined to be ineligible for the program under this title
or title XIX.''.
(4) Additional amendments to title xxi.--
(A) No cost-sharing for pregnancy-related services.--
Section 2103(e)(2) of the Social Security Act (42 U.S.C.
1397cc(e)(2)) is amended--
(i) in the heading, by inserting ``or pregnancy-related
services'' after ``preventive services''; and
(ii) by inserting before the period at the end the
following: ``or for pregnancy-related services''.
(B) No waiting period.--Section 2102(b)(1)(B) of the Social
Security Act (42 U.S.C. 1397bb(b)(1)(B)) is amended--
(i) by striking ``, and'' at the end of clause (i) and
inserting a semicolon;
(ii) by striking the period at the end of clause (ii) and
inserting ``; and''; and
(iii) by adding at the end the following:
``(iii) may not apply a waiting period (including a waiting
period to carry out paragraph (3)(C)) in the case of a
targeted low-income pregnant woman.''.
(c) Effective Date.--The amendments made by this section
apply to items and services furnished on or after October 1,
2003, without regard to whether regulations implementing such
amendments have been promulgated.

SEC. 3. COORDINATION WITH THE MATERNAL AND CHILD HEALTH
PROGRAM.

(a) In General.--Section 2102(b)(3) of the Social Security
Act (42 U.S.C. 1397bb(b)(3)) is amended--
(1) in subparagraph (D), by striking ``and'' at the end;
(2) in subparagraph (E), by striking the period and
inserting ``; and''; and
(3) by adding at the end the following new subparagraph:
``(F) that operations and activities under this title are
developed and implemented in consultation and coordination
with the program operated by the State under title V in areas
including outreach and enrollment, benefits and services,
service delivery standards, public health and social service
agency relationships, and quality assurance and data
reporting.''.
(b) Conforming Medicaid Amendment.--Section 1902(a)(11) of
such Act (42 U.S.C. 1396a(a)(11)) is amended--
(1) by striking ``and'' before ``(C)''; and
(2) by inserting before the semicolon at the end the
following: ``, and (D) provide that operations and activities
under this title are developed and implemented in
consultation and coordination with the program operated by
the State under title V in areas including outreach and
enrollment, benefits and services, service delivery
standards, public health and social service agency
relationships, and quality assurance and data reporting''.
(c) Effective Date.--The amendments made by this section
take effect on January 1, 2004.

SEC. 4. INCREASE IN SCHIP INCOME ELIGIBILITY.

(a) Definition of Low-Income Child.--Section 2110(c)(4) of
the Social Security Act (42 U.S.C. 42 U.S.C. 1397jj(c)(4)) is
amended by striking ``200'' and inserting ``250''.
(b) Effective Date.--The amendment made by subsection (a)
applies to child health assistance provided, and allotments
determined under section 2104 of the Social Security Act (42
U.S.C. 1397dd), for fiscal years beginning with fiscal year
2004.

SEC. 5. REVIEW OF STATE AGENCY BLINDNESS AND DISABILITY
DETERMINATIONS.

Section 1633 of the Social Security Act (42 U.S.C. 1383b)
is amended by adding at the end the following:
``(e)(1) The Commissioner of Social Security shall review
determinations, made by State agencies pursuant to subsection
(a) in connection with applications for benefits under this
title on the basis of blindness or disability, that
individuals who have attained 18 years of age are blind or
disabled as of a specified onset date. The Commissioner of
Social Security shall review such a determination before any
action is taken to implement the determination.
``(2)(A) In carrying out paragraph (1), the Commissioner of
Social Security shall review--
``(i) at least 25 percent of all determinations referred to
in paragraph (1) that are made in fiscal year 2004; and
``(ii) at least 50 percent of all such determinations that
are made in fiscal year 2005 or thereafter.
``(B) In carrying out subparagraph (A), the Commissioner of
Social Security shall, to the extent feasible, select for
review the determinations which the Commissioner of Social
Security identifies as being the most likely to be
incorrect.''.

[[Page S5969]]

The Secretary of Health

and Human Services,

Washington, DC, April 12, 2002.
Hon. Jeff Bingaman,
U.S. Senate,
Washington, DC.
Dear Senator Bingaman: Thank you for sharing your views on
our new proposal to expand health care coverage for low-
income pregnant women under the State Children's Health
Insurance Program (SCHIP). I believe it is not only
appropriate, but indeed, medically necessary that our
approach to child health care include the prenatal stage.
Prenatal care for women and their babies is a crucial part
of medical care. These services can be a vital, life-long
determinant of health, and we should do everything we can to
make this care available for all pregnant women. It is one of
the most important investments we can make for the long-term
good health of our nation.
Our regulation would enable states to make use of funding
already available under SCHIP to provide prenatal care for
more low-income pregnant women and their babies. The proposed
regulation, published in the Federal Register March 5, would
clarify the definition of ``child'' under the SCHIP program.
At present, SCHIP allows states to provide health care
coverage to targeted low-income children under age 19. States
may further limit their coverage to age groups within that
range. The new regulation would clarify that states may
include coverage for children from conception to age 19,
enabling SCHIP coverage to include prenatal and delivery care
to ensure the birth of healthy infants.
Although Medicaid currently provides coverage for prenatal
care for some women with low incomes, implementing this new
regulation will allow states to offer such coverage to
additional women. States would not be required to go through
the section 1115 waiver process to expand coverage for
prenatal care.
By explicitly recognizing in our SCHIP regulations the
health needs of children before birth, we can help states
provide vital prenatal health care. I believe our approach is
entirely appropriate to serve these health purposes. It has
been an option for states in their Medicaid programs in the
past and it should be made an option for states in their
SCHIP program now. As I testified recently at a hearing held
by the Health Subcommittee of the House Energy and Commerce
Committee, I also support legislation to expand SCHIP to
cover pregnant women. However, because legislation has not
moved and because of the importance of prenatal care, I felt
it was important to take this action.
I know we share the same commitment to achieving the goal
of expanding health insurance coverage in order to reduce the
number of uninsured.
A similar letter is being sent to the cosigners of your
letter. Please feel free to call me if you have any questions
or concerns.
Sincerely,
Tommy G. Thompson.
____

The Secretary of Health

and Human Services,

Washington, DC, October 8, 2002.
Hon. Don Nickles,
Assistant Republican Leader,
Washington, DC.
Dear Senator Nickles: Thank you for contacting me about the
Department of Health and Human Services' final regulation to
expand pre-natal and pregnancy related services to unborn
children under the State Children's Health Insurance Program
(SCHIP).
The final rule allows states the option to extend such
services under SCHIP to low-income pregnant women and their
unborn children immediately. The rule also enables states to
cover a broader population of low-income women and children
because it extends coverage to unborn children regardless of
their mothers' immigrant status.
In your letter, you ask if ``this regulation has obviated
the need for additional legislation, and has addressed this
issue in a more timely and effective manner.'' As I have
stated many times this year, my overarching goal has been to
extend prenatal and pregnancy related services to low-income
women and their children as quickly as possible so that those
mothers are cared for during their pregnancy and their
children are born healthy and strong. The law provided me the
flexibility to do that and I believe the rule that was
published this week achieves this universally desired goal.
The proposed legislation, which has been pending in Congress
for some time, would amend the SCHIP law so as to duplicate
what we have already established as administration policy. I
believe the regulation is a more effective and comprehensive
solution to this issue. Therefore, there is no need for the
Senate to pursue this legislation now.
Thank you for inquiring on this important policy matter.
Sincerely,
Tommy G. Thompson.
____

U.S. Senate,

Washington, DC, October 10, 2002.
Hon. Tommy Thompson,
Secretary, Department of Health and Human Services,
Washington, DC.
Dear Secretary Thompson: Over the course of the past year,
you have issued press releases, written letters, and
responded to direct questions in both Senate and House
hearings in support of passing legislation to provide health
care coverage to pregnant women through the State Children's
Health Insurance Program (SCHIP). You have repeatedly stated
that you were proceeding with the regulation to expand SCHIP
to ``unborn children'' only because legislation to expand
coverage to pregnant women had not passed.
Your own regulation explicitly makes that very point and
acknowledges that ``gaps remain'' and that a number of
important health services for pregnant women, including
postpartum care, are not provided for in the regulation. And
yet, we now read in a letter from you to Senator Nickles
dated October 8, 2002, that the ``gaps'' have somehow
disappeared. As you write, ``The proposed legislation, which
has been pending in Congress for some time, would amend the
SCHIP law so as to duplicate what we have already established
as administration policy. I believe the regulation is a more
effective and comprehensive solution to this issue.
Therefore, there is no need for the Senate to pursue this
legislation now.''
Yet, your own regulation contradicts that statement and
notes that ``there are still gaps'' and repeatedly points out
those coverage gaps for pregnant women and children. With
respect to care for women, under the regulation, it is
explicitly stated that ``there must be a connection between
the benefits provided and the health of the unborn child.'' A
whole range of health services to pregnant women during
pregnancy and delivery could be potentially denied as a
result. In the case of epidurals, for example, the best the
regulation can say is that you ``expect'' coverage.
For postpartum care, the regulation explicitly states that
any care during that period, including but not limited to
hemorrhage, infection, episiotomy repair, C-section repair,
family planning counseling, treatment of complications after
delivery (including life-saving surgery), and postpartum
depression, would be denied. As the regulation reads,
``Commenters are correct that care after delivery, such as
postpartum services could not be covered as part of [SCHIP],
(unless the mother is under age 19 and eligible for SCHIP in
her own right), because they are not services for an eligible
child.''
According to the Centers for Disease Control and Prevention
(CDC), the United States ranks 21st in the world in maternal
mortality. The major causes of which were hemorrhage, ectopic
pregnancy, pregnancy-induced hypertension, embolism,
infection, and other complications of pregnancy and
childbirth. Again, health coverage for many of these
conditions is denied under the regulation but not in S. 724.
How then do you argue the regulation is ``more effective and
comprehensive'' and that the legislation is ``duplicat[ive]''
of the regulation with respect to care for pregnant women?
With respect to coverage of children, under the regulation,
the 12-month continuous eligibility for children is not from
the time of birth but the clock begins running during the
time of coverage prior to birth. S. 724 provides
comprehensive pediatric care to children throughout the first
and most fragile year of life. In contrast, for prenatal care
delivered to an ``unborn child'' under this regulation, that
time is subtracted from the 12-month period after birth.
Therefore, under the regulation, if nine months of prenatal
care are provided, the child could lose coverage at the end
of the 3rd month after birth. Potentially lost would be a
number of important well-baby visits, immunizations, and
access to their pediatric caregiver. Once again, how then do
you argue the regulation is ``more effective and
comprehensive'' and that the legislation is
``duplicat[ative]'' to the regulation for children?
Furthermore, according to the rule, the Administration
estimates that only 13 states will elect to adopt this
definition to include ``unborn children'' in their SCHIP
state plans. The other 37 states will either not expand SCHIP
to provide prenatal care to additional populations or be
forced to seek a federal waiver to also cover pregnant women,
as Colorado did just two weeks ago. However, the regulation
was right on the mark in stating that it is ``an inferior
option'' to require states to have to get waivers to provide
the full range of care to pregnant women and 12-month
continuous eligibility for children after birth.
As the regulation reads, ``. . . the Secretary's ability to
intervene through one mechanism (a waiver) should not be the
sole option for States and may in fact be an inferior option.
Waivers are discretionary on the part of the Secretary and
time limited while State plan amendments are permanent, and
are subject to budget neutrality.'' For a third time, how can
you now argue, less than a week after issuing the regulation,
that it is ``more effective and comprehensive'' than the
legislation?
The States agree, as you know. The National Governors'
Association has clear policy expressing support for the
passage of such legislation. As their policy position (HR-15.
``The State Children's Health Insurance Program (S-CHIP)
Policy'') reads:
``The Governors have a long tradition of expanding coverage
options for pregnant women through the Medicaid program.
However, pregnant women in working families are not eligible
for SCHIP coverage. The Governors call on Congress to create
a state option that would allow states to provide health
coverage to income-eligible pregnant women under SCHIP. This
small shift in federal policy would allow states to provide
critical prenatal care and would increase the likelihood that
children born to SCHIP mothers would have a healthy start.''

[[Page S5970]]

Finally, unlike S. 724, the regulation provides absolutely
no additional resources (despite estimating the cost to be
$330 million over the next five years) for covering ``unborn
children'' and certain pregnancy-related services. Current
projections by the Office of Management and Budget indicate
that SCHIP funds will ultimately be inadequate to cover all
the children currently enrolled, even though millions of
additional children are eligible but not currently covered.
In sharp contrast, just as S. 724 does, we must provide
adequate resources to serve both low-income children and low-
income pregnant women.
Mr. Secretary, just as you said in your press release on
January 31, 2002, we also praise Senators Bond, Breaux, and
Collins for ``bipartisan leadership in supporting S. 724, a
bill that would allow states to provide prenatal coverage for
low-income women through the SCHIP program. We support this
legislative effort in this Congress.'' We agreed with you on
January 31, 2002, and hope that you will once again support
the passage of S. 724, the ``Mothers and Newborns Health
Insurance Act.''
We eagerly await your response to this very important
matter with respect to the health and well-being of our
nation's children and mothers.
Sincerely,
Jeff Bingaman, Jon Corzine, Edward M. Kennedy, Maria
Cantwell, Hillary Rodham Clinton, Dianne Feinstein,
Blanche L. Lincoln, Mary Landrieu, Patty Murray, James
M. Jeffords, John B. Breaux, Jack Reed, Patrick J.
Leahy, Barbara A. Mikulski, Charles E. Schumer.
____

The Secretary of Health

and Human Services,

Washington, DC, October 15, 2002.
Hon. Jeff Bingaman,
U.S. Senate,
Washington, DC.
Dear Senator Bingaman: Thank you for your letter of last
week and your continued interest in finding effective ways to
increase prenatal coverage.
I have frequently stated in the past that my chief
objective in proposing the rule to extend coverage to unborn
children was to ensure that pregnant women and children who
are currently ineligible for health care under either
Medicaid or S-CHIP are given the support they need for a
healthy pregnancy and a safe delivery. This is clearly a goal
we share. When asked my position on pending legislation
earlier this year, I expressed general support because my
overriding interest and concern has always been to provide
prenatal care to more women and children. If legislation
could provide that coverage more expeditiously, then it
seemed to me it would be advantageous to women and children
to see that go forward.
However, despite years of committed effort by you and other
members, Congress has yet to move legislation through the
process. Legislation was introduced in the 106th Congress but
was never reported out of Committee in either the House or
Senate. In this current Congress, the Senate Finance
Committee reported S. 724 in early August of this year, but
no floor time was scheduled for its consideration.
Consequently, after seven months without any legislative
action, I issued a final regulation.
Last year, when I saw that I had the authority under
current law to provide prenatal and delivery care to low-
income pregnant mothers and their unborn children, I was
excited because I realized the Department could accomplish
what we all wish to achieve: helping those children get a
healthy start in life. A great deal of thought went into the
regulation and, with the exception of postpartum care after
hospitalization, we were able to give the states the same
flexibility the would have under the proposed legislation to
provide prenatal and delivery care to unborn children and
their mothers.
Under current law, however, we have the authority to grant
waivers that include coverage for women if they become
pregnant, including postpartum care. Since January 2001, I
have granted approval to a number of states to allow for
expanded health insurance coverage through comprehensive 1115
waivers, which also include postpartum care. In fact, this
summer I approved a waiver for New Mexico which included
prenatal care, labor and delivery, and postpartum care. This
regulation simply adds to the options available to the states
in expanding health insurance coverage.
In addition to making it possible for states to use federal
funds to provide the prenatal and pregnancy-related coverage
options available under S. 724, the regulation provides
additional opportunities and assistance for states to reach
low-income women. For example, under the regulation, we were
able to reach an even broader population of vulnerable women
and children because we could offer prenatal care to the
children of immigrants who are otherwise ineligible for any
coverage. The establishment of eligibility regardless of
immigrant status is possible under the regulation but not
under S. 724, making the regulation more comprehensive. I am
sure you appreciate the importance of the new opportunity to
provide prenatal care and pregnancy-related services to
immigrant mothers, given the substantial immigrant population
in New Mexico.
Additionally, the regulation provides more opportunities
for states to access enhanced-match funds than S. 724. Under
the bill, states with current eligibility levels for pregnant
women below 185 percent of poverty would not be eligible for
the enhanced match until they raised their eligibility at
their regular match rate. States have already had the option
to raise eligibility for pregnant women at their regular
match rate, but many have not done so. Thus, we expect that
many states will not expand prenatal coverage under S. 724.
However, access to enhanced-match funds under the regulation
will provide them a more affordable opportunity to do so.
With regard to specific criticisms of the rule, you have
raised concerns about the reference in the S-CHIP regulation
to ``gaps.'' It is important to put the use of the term
``gaps'' in the proper context. This reference is to the
eleigbility gap between Medicaid and S-CHIP, which the
regulation and S. 724 both seek to close. The response in the
regulation does not refer to benefits, so the reference in
your recent letter that ``gaps remain'' is taken out of
context and, in fact, an incorrect referencing of the
regulation.
Under both the regulation and the legislation, the states
ultimately determine the benefit package. That feature of
your legislation does not differ from the rule. And, we have
clearly indicated federal funds will be available for
services including prenatal care and labor and delivery. Your
letter makes assumptions regarding medical services during
pregnancy and delivery that HHS does not. The letter confuses
medical decisions that are made by physicians with payment of
claims under a public assistance program. The regulation is
used to establish eligibility for benefits and does not
itself extend into medical decision-making between a woman
and her physician. HHS responded to a number of questions
regarding services and clearly indicated federal financial
participation would be available. There is no need to further
question whether a claim for a service already provided will
receive federal matching funds.
The issue of 12 months continuous eligibility is an option
for the states. Under the regulation, states that want to
extend eligibility can easily do so.
I hope this explanation of the regulation and where it
extends beyond the reach of S. 724 will give you confidence
in our policy and it's ability to meet the ultimate goal that
you and I have worked over the years to meet. You are due a
large measure of credit for your efforts on behalf of low-
income women and their children. The regulation is a victory
for those women and children and will give otherwise
uncovered needy mothers and their babies a healthy start in
life.
Sincerely,
Tommy G. Thomspon.
____

U.S. Senate,

Washington, DC, October 23, 2002.
Hon. Tommy Thompson,
Secretary, Department of Health and Human Services,
Washington, DC.
Dear Senator Thompson: Thank you for your letter yesterday
with regard to improving health coverage for pregnant women
and children. We appreciate your stated desire to ``give
otherwise uncovered needy mothers and their babies a healthy
start in life'' by adding ``to the options available to the
states in expanding health insurance options.'' We believe we
can take the best aspects of the legislation and the
regulation to truly improve the health and well-being of our
nation's children and mothers.
In light of the fact that our nation ranks 26th in infant
mortality and 21st in maternal mortality in the world, which
is the worst among developed nations, we would be remiss to
not take the simple but critical step of increasing access to
prenatal, delivery, and postpartum care through the State
Children's Health Insurance Program (SCHIP) to help prevent
birth defects and prematurity, the most common causes of
infant death and disability, and maternal death and
disability.
As your letter acknowledges, postpartum care is not covered
under the regulation. This gap in coverage includes a range
of critical care for women, including potentially life-saving
postpartum care for hemorrhage, pregnancy-induced
hypertension, infection, ectopic pregnancy, embolism,
episiotomy repair, Caesarean section repair, family planning
counseling, postpartum depression, and other complications of
pregnancy and childbirth. In fact, according to the National
Committee for Quality Assurance (NCQA), ``Hemorrhage,
pregnancy-induced hypertension, infection, and ectopic
pregnancy continue to account for more than half of all
maternal deaths (59 percent).''
According to the Centers for Disease Control and Prevention
(CDC), there were 3,193 pregnancy-related deaths in this
country between 1991 and 1997 for an overall pregnancy-
related mortality ratio (PRMR) of 11.5 per 100,000 live
births. Racial disparities are rather dramatic with respect
to maternal mortality. African-American women had mortality
rates over four times higher than that of non-Hispanic whites
over the period. American Indian/Alaska Natives, Asian/
Pacific Islanders, and Hispanic women had mortality rates 67
percent, 55 percent, and 41 percent, respectively, higher
than non-Hispanic whites.
Those disparities are even more pronounced in some states.
For example, in Wisconsin, the maternal mortality rate for
African-American women was 4.2 times that of white women
between 1987 and 1996. Certainly, this is something that we
can all agree should be addressed.

[[Page S5971]]

To allow states the option to provide comprehensive
coverage to pregnant women, including postpartum care,
through SCHIP would help achieve that important goal. S. 724,
the ``Mothers and Newborns Health Insurance Act,'' gives
states that important coverage option while the regulation
does not.
While your letter correctly notes that states may receive
comprehensive 1115 waivers to provide coverage to pregnant
women, your regulation is correct in noting that is an
inferior option. As the regulation reads, ``. . . the
Secretary's ability to intervene through one mechanism (a
waiver) should not be the sole option for States and may in
fact be an inferior option. Waivers are discretionary on the
part of the Secretary and time limited while State plan
amendments are permanent, and are subject to budget
neutrality.'' We should remove those barriers and give states
the option to provide pregnant women coverage without having
to seek waivers.
We would add that the waiver option is allowed for the
purposes of giving the Secretary demonstration authority. We
certainly can all acknowledge that coverage of pregnant women
has reduced both infant mortality and maternal mortality and
need not be demonstrated any further. The waiver process
seems inappropriate for this purpose. Instead, we should
remove those barriers for states to provide comprehensive
coverage to pregnant women. As the National Governors'
Association has stated in its policy (HR-15. ``The State
Children's Health Insurance Program (S-CHIP) Policy''): The
Governors call on Congress to create a state option that
would allow states to provide health coverage to income-
eligible women under SCHIP. This small shift in federal
policy would allow states to provide critical prenatal care
and would increase the likelihood that children born to SCHIP
mothers would have a healthy start.
Just as the governors have requested, we can still make
that ``small shift'' in policy through the passage of S. 724.
As for the coverage of infants, your letter did not address
the issues raised in a previous letter to you from 15
senators, including many of us, dated October 10, 2002. Your
letter restates the fact that states have the option to
provide children 12 months of continuous eligibility in
Medicaid and SCHIP. However, under the regulation, the 12-
month continuous eligibility for children is not from the
time of birth. Rather, the clock begins running during the
time of coverage prior to birth. Thus, it is likely that most
newborns would have far less than 12 months of coverage after
birth if a State chooses to use the option to provide care to
``unborn children.'' If covered for the full nine months of
pregnancy, the child could lose eligibility for SCHIP after
the third month of life and consequently lose important
coverage for well-baby visits, immunizations, and access to
their pediatric caregiver. That would be an outright
reduction of coverage for some children after birth.
We would note that the legislation continues to have the
strong support of a number of groups, including some who
support the regulation but acknowledge its shortcomings and
continue to support passing legislation. Those groups include
the American Association of University Affiliated Programs,
the American Academy of Pediatrics, the American College of
Nurse Midwives, the American College of Obstetrics and
Gynecologists, the American Hospital Association, the
American Medical Association, the American Public Health
Association, the Association of Women's Health, Obstetric and
Neonatal Nurses, the Association of Maternal and Child Health
Programs, the Catholic Health Association, Catholic Charities
USA, the Council of Women's and Infants' Specialty Hospitals,
the Easter Seals, FamilyVoices, the March of Dimes, the
National Association of Children's Hospitals, the National
Association of Public Hospitals and Health Systems, the
National Women's Health Network, the National Association of
County and City Health Officials, the Society for Maternal-
Fetal Medicine, the Spina Bifida Association of America, the
Alan Guttmacher Institute, and the United Cerebral Palsy
Associations.
There are certainly areas where the regulation is more
comprehensive than the legislation, such as providing
coverage to the ``unborn children'' of immigrant mothers and
by providing states easier access to enhanced matching funds.
We believe we could certainly amend S. 724 to address these
shortcomings rather easily. It would be easy to drop the
requirement in the bill for a state to expand eligibility to
185 percent of poverty before receiving the enhanced matching
rate. However, this begs the question about the need for
providing additional resources in SCHIP to cover these
options. Current projections by the Office of Management and
Budget indicate that SCHIP funds will ultimately be
inadequate to cover all the children currently enrolled, even
though millions of additional children are eligible but not
currently covered. S. 724 provides such funding, which the
regulation does not and cannot.
In short, we believe that we can rather quickly achieve the
best of both the legislation and the regulation. S. 724
expands state options to cover critically important
postpartum services for women, ensures children are eligible
for coverage throughout the first and most critical year of
life, and provides much needed resources to provide such
care. In contrast, the regulation provides states with more
opportunities to access enhanced matching funds and provides
certain prenatal care services to immigrant mothers that S.
724 does not provide.
We would like to arrange a meeting with you or your staff
to jointly modify S. 724 to address, as best as we can, the
concerns we have discussed above and that you have raised
with the legislation to accomplish the objective we all share
of improving the health and well-being of out nation's
children and mothers.
Sincerely,
Jeff Bingaman. Blanche L. Lincoln. Jon Corzine. Maria
Cantwell. Patty Murray. Mary Landrieu. James M.
Jeffords. Edward M. Kennedy. Hillary Rodham Clinton.
Charles E. Schumer. John F. Kerry. John R. Edwards.
Daniel K. Akaka. Jack Reed. Robert G. Torricelli.

Mr. LUGAR. Mr. President, I rise today with my colleague Senator
Bingaman to re-introduce the Start Healthy, Stay Healthy Act of 2003.
The United States ranks 26th in infant mortality and 21st in maternal
mortality in the world, the worst among developed nations. Study after
study shows that providing prenatal care to pregnant women reduces
maternal and infant mortality and the incidence of low birth weight
babies. According to the American Medical Association, ``Babies born to
women who do not receive prenatal care are four times more likely to
die before their first birthday.''
The Start Healthy, Stay Healthy Act of 2003 would significantly
reduce the number of uninsured pregnant women and newborns by providing
States with the option to further extend coverage to pregnant women
through Medicaid and CHIP, to reduce infant and maternal mortality and
low birth weight babies, and to cover newborns through the first full
year of life.
Current federal law allows pregnant women to receive coverage through
CHIP through age 18--creating a perverse Federal incentive of covering
only teenage pregnant women and cutting off that coverage once they
turn 19 years of age. This legislation would eliminate this problem by
allowing States to cover pregnant women through CHIP, regardless of
age. This also eliminates the unfortunate separation between pregnant
women and infants that has been created through CHIP, and is contrary
to longstanding federal policy through programs such as Medicaid, Women
with Infants and Children, WIC, Maternal and Child Health, MCH, etc.
An estimated 4.3 million, or 32 percent, of mothers below 200 percent
of poverty are uninsured. According to the March of Dimes, ``Over 95
percent of all uninsured pregnant women could be covered through a
combination of aggressive Medicaid outreach, maximizing coverage for
young women through [CHIP], and expanding CHIP to cover income-eligible
pregnant women regardless of age.''
Increasing the availability of affordable health care is certainly an
issue of great importance to our Nation--particularly those who are
uninsured. While our bill will not solve the problem of the uninsured,
we believe that helping more pregnant women and babies receive care is
a significant step in the right direction.
I ask our colleagues to support the Start Healthy, Stay Healthy Act
of 2003, and help us take this important step in improving health care
for the mothers of tomorrow.
______

By Mrs. FEINSTEIN (for herself, Mr. Schumer, Mr. Chafee, Mr.
Jeffords, Mr. Kennedy, Mr. Durbin, Mr. Lautenberg, Mrs. Boxer,
and Mr. Reed):
S. 1034. A bill to repeal the sunset date on the assault weapons ban,
to ban the importation of large capacity ammunition feeding devices,
and for other purposes; to the Committee on the Judiciary.
Mrs. FEINSTEIN. Mr. President, I rise today to introduce legislation
with Senators Chuck Schumer, Lincoln Chafee, Barbara Boxer, Dick
Durbin, Jack Reed, Frank Lautenberg, Jim Jeffords, and Edward Kennedy
that would permanently reauthorize the assault weapons ban and close
the clip-importation loophole.
Military-style assault weapons simply have no place on America's
streets. But if Congress fails to act, the current ban will expire next
year. This would be a terrible mistake.
This is why Congress must reauthorize the ban and close the high-
capacity

[[Page S5972]]

clip importation loophole so that we can help keep America's streets
safe from the violence produced by assault weapons.
Almost 10 years ago on July 1, 1993 Gian Luigi Ferri walked into 101
California Street in San Francisco carrying two high-capacity TEC-9
assault pistols.
Within minutes, he had murdered eight people, and six others were
wounded. This tragedy shook San Francisco and the entire nation.
We saw with absolute clarity the destruction that could be inflicted
with these military-style assault weapons.
Navegar's advertising for the TEC-9 touted the gun as being for
`paramilitary' use and `resistant to fingerprints,' with a `military
non-glare finish,' a `military blowback system,' and `combat-type'
sights.
Guns like these are the weapons of choice to commit crimes. They are
the weapons of choice for drive-by shooters, criminals going into a
major criminal event, and malcontents who are seeking to do the maximum
damage possible in the shortest amount of time.
That's what makes them so dangerous because they have light triggers,
you can spray fire them, you can hold them with two hands, and you
don't really need to aim.
They are not weapons of choice for hunting or defensive purposes.
In the aftermath of 101 California and countless other shootings, I
decided to do something that no one had succeeded in doing before: to
ban the manufacture and importation of military style assault weapons.
I authored the bill in the Senate, and Senator Schumer authored it in
the House of Representatives.
I remember all the late night calls I got and all the friends who
took me aside and said to me: ``Don't do it. The gunners are too
powerful. You'll never ever win.''
Well, we did win. We passed the first-ever ban on assault weapons,
and since September 13, 1994, it has been illegal to manufacture and
import military-style assault weapons.
The hope of the bill has been to drive down the supply of these
weapons and make them more expensive to obtain.
And in the years following the enactment of the ban, crimes using
assault weapons were reduced dramatically.
In 1993, assault weapons accounted for 8.2 percent of all guns used
in crimes; By the end of 1995, that proportion had fallen to 4.3
percent--a dramatic drop; and by November 1996, the last date for which
statistics are available, the proportion had fallen to 3.2 percent.
These are dramatic results, which show that the Assault Weapons ban
has worked. We have had trouble getting updated statistics from this
Justice Department, but it is clear that after we banned these guns,
criminals used them less frequently in crime.
Unfortunately, to get the bill passed in 1994, we had to agree to a
ten-year sunset in the bill--and this is why we are here today. If we
do not re-authorize the 1994 assault weapons ban this Congress, it will
expire on September 13, 2004.
That means that at the end of next year, manufacturers could once
again begin making AK-47s, TEC-9s, and other banned guns that have but
one purpose--to kill other human beings.
We are here today because we believe that this would be a terrible
mistake--with deadly consequences for thousands of Americans each year.
So today we will introduce legislation to do two simple things.
First, the legislation would reauthorize the 1994 assault weapons ban
by striking the sunset date from the original law. This would ban the
manufacture of 19 types of common military style assault weapons--for
all time.
It would ban an additional group of these assault weapons that have
been banned by characteristic for 8 years.
It would protect some 670 hunting and other recreational rifles for
use by law-abiding citizens.
And it would preserve the right of police officers and other law
enforcement officials to use and obtain newly manufactured semi-
automatic assault weapons--helping to prevent instances when law
enforcement agents are outgunned by perpetrators.
We certainly would like a stronger bill that would tighten the ban--
based on our 10 years of experience of what the gun companies have done
to get around the bill.
But unfortunately there is not the support for that right now. If the
support becomes evident, then we may amend the bill at a later date.
Second, the legislation would close a loophole in the 1994 law, which
prohibits the domestic manufacture of high-capacity ammunition
magazines, but allows foreign companies to continue sending them to
this country by the millions.
A measure that would have closed this loophole passed the House and
Senate in 1999 by wide margins, but got bottled up in a larger
conference due to an unrelated provision.
The result: the Bureau of Alcohol, Tobacco and Firearms has approved
the importation of almost 50 million high capacity ammunition magazines
from some 50 countries since 1994.
It is these large clips, drums, and strips that allow lone gunmen, or
small groups of teenagers, to inflict so much damage in such a small
amount of time.
We must close this loophole now.
The good news: President Bush has indicated that he supports each of
these provisions. During the 2000 Presidential Campaign, President Bush
indicated that he supported both reauthorization of the assault weapons
ban and closing the clip importation loophole.
And just a few weeks ago, President Bush's spokesman Scott McClellan
reiterated his support for reauthorizing the ban when he said: ``The
President supports the current law, and he supports reauthorization of
the current law.''
It is therefore our hope that the President will work with us to see
this bill passed. We welcome the President's support and look forward
to working with him to gain swift passage of this legislation.
One of the best examples of the damage that assault weapons can
inflict is the massacre in Littleton, Colorado.
On April 24, 1999, Eric Harris and Dylan Klebold used a TEC DC-9
semi-automatic pistol to attack the students and teachers of Columbine
High School.
They used this weapon to take the lives of 13 innocents, 12 students
and 1 teacher, and injured dozens more mothers, fathers, sons and
daughters.
I do not believe that the 2nd Amendment protects military assault
weapons. The Constitution is not an umbrella for mayhem. The Bill of
Rights is not a guarantor of violence.
Congress has passed this legislation once--it is time to pass the
assault weapons ban again.
I ask unanimous consent that the text of the bill be printed in the
Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:

S. 1034

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 ``Assault Weapons Ban
Reauthorization Act of 2003''.

SEC. 2. REPEAL OF SUNSET DATE.

Section 110105 of the Public Safety and Recreational
Firearms Use Protection Act (18 U.S.C. 921 note) is amended
to read as follows:

``SEC. 110105. EFFECTIVE DATE.

``This subtitle and the amendments made by this subtitle
shall take effect on September 13, 1994.''.

SEC. 3. BAN ON IMPORTING LARGE CAPACITY AMMUNITION FEEDING
DEVICES.

(a) In General.--Section 922(w) of title 18, United States
Code, is amended--
(1) in paragraph (1), by striking ``(1) Except as provided
in paragraph (2)'' and inserting ``(1)(A) Except as provided
in subparagraph (B)'';
(2) in paragraph (2), by striking ``(2) Paragraph (1)'' and
inserting ``(B) Subparagraph (A)'';
(3) by inserting before paragraph (3) the following:
``(2) It shall be unlawful for any person to import a large
capacity ammunition feeding device.''; and
(4) in paragraph (4)--
(A) by striking ``(1)'' each place it appears and inserting
``(1)(A)''; and
(B) by striking ``(2)'' and inserting ``(1)(B)''.
(b) Conforming Amendment.--Section 921(a)(31) of title 18,
United States Code, is amended by striking ``manufactured
after the date of enactment of the Violent Crime Control and
Law Enforcement Act of 1994''.

[[Page S5973]]

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