[House Report 109-88]
[From the U.S. Government Publishing Office]



109th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     109-88
======================================================================


 
        SERVICEMEMBERS' HEALTH INSURANCE PROTECTION ACT OF 2005

                                _______
                                

  May 19, 2005.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

   Mr. Buyer, from the Committee on Veterans' Affairs, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 2046]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Veterans' Affairs, to whom was referred the 
bill (H.R. 2046) to amend the Servicemembers Civil Relief Act 
to limit premium increases on reinstated health insurance on 
servicemembers who are released from active military service, 
and for other purposes, having considered the same, report 
favorably thereon with an amendment and recommend that the bill 
as amended do pass.
  The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Servicemembers' Health Insurance 
Protection Act of 2005''.

SEC. 2. LIMITATION ON PREMIUM INCREASES FOR REINSTATED HEALTH INSURANCE 
                    OF SERVICEMEMBERS RELEASED FROM ACTIVE MILITARY 
                    SERVICE.

  (a) Premium Protection.--Section 704 of the Servicemembers Civil 
Relief Act (50 U.S.C. App. 594) is amended by adding at the end the 
following new subsection:
  ``(e) Limitation on Premium Increases.--
          ``(1) Premium protection.--The amount of the premium for 
        health insurance coverage that was terminated by a 
        servicemember and required to be reinstated under subsection 
        (a) may not be increased, for the balance of the period for 
        which coverage would have been continued had the coverage not 
        been terminated, to an amount greater than the amount 
        chargeable for such coverage before the termination.
          ``(2) Increases of general applicability not precluded.--
        Paragraph (1) does not prevent an increase in premium to the 
        extent of any general increase in the premiums charged by the 
        carrier of the health care insurance for the same health 
        insurance coverage for persons similarly covered by such 
        insurance during the period between the termination and the 
        reinstatement.''.
  (b) Technical Amendment.--Subsection (b)(3) of such section is 
amended by striking ``if the'' and inserting ``in a case in which 
the''.

SEC. 3. PRESERVATION OF EMPLOYER-SPONSORED HEALTH PLAN COVERAGE FOR 
                    CERTAIN RESERVE-COMPONENT MEMBERS WHO ACQUIRE 
                    TRICARE ELIGIBILITY.

  (a) Continuation of Coverage.--Subsection (a)(1) of section 4317 of 
title 38, United States Code, is amended by inserting after ``by reason 
of service in the uniformed services,'' the following: ``or such person 
becomes eligible for medical and dental care under chapter 55 of title 
10 by reason of subsection (d) of section 1074 of that title,''.
  (b) Reinstatement of Coverage.--Subsection (b) of such section is 
amended--
          (1) in paragraph (1)--
                  (A) by inserting after ``by reason of service in the 
                uniformed services,'' the following: ``or by reason of 
                the person's having become eligible for medical and 
                dental care under chapter 55 of title 10 by reason of 
                subsection (d) of section 1074 of that title,''; and
                  (B) by inserting ``or eligibility'' before the period 
                at the end of the first sentence; and
          (2) by adding at the end the following new paragraph:
  ``(3) In the case of a person whose coverage under a health plan is 
terminated by reason of the person having become eligible for medical 
and dental care under chapter 55 of title 10 by reason of subsection 
(d) of section 1074 of that title but who subsequently does not 
commence a period of active duty under the order to active duty that 
established such eligibility because the order is canceled before such 
active duty commences, the provisions of paragraph (1) relating to any 
exclusion or waiting period in connection with the reinstatement of 
coverage under a health plan shall apply to such person's continued 
employment, upon the termination of such eligibility for medical and 
dental care under chapter 55 of title 10 that is incident to the 
cancellation of such order, in the same manner as if the person had 
become reemployed upon such termination of eligibility.''.

SEC. 4. TECHNICAL CORRECTIONS TO VETERANS BENEFITS IMPROVEMENT ACT OF 
                    2004.

  (a) Corrections.--Section 2101 of title 38, United States Code, as 
amended by section 401 of the Veterans Benefits Improvement Act of 2004 
(Public Law 108-454; 118 Stat. 3614), is amended--
          (1) by redesignating subsection (c) as subsection (d);
          (2) by inserting after subsection (b) a new subsection (c) 
        consisting of the text of subsection (c) of such section 2101 
        as in effect immediately before the enactment of such Act, 
        modified--
                  (A) in paragraph (1)--
                          (i) in the first sentence, by striking 
                        ``paragraph (1), (2), or (3)'' and inserting 
                        ``subparagraph (A), (B), (C), or (D) of 
                        paragraph (2)''; and
                          (ii) in the second sentence, by striking 
                        ``the second sentence'' and inserting 
                        ``paragraph (3)''; and
                  (B) in paragraph (2)--
                          (i) in the first sentence, by striking 
                        ``paragraph (1)'' and inserting ``paragraph 
                        (2)''; and
                          (ii) in the second sentence, by striking 
                        ``paragraph (2)'' and inserting ``paragraph 
                        (3)''; and
          (3) in subsection (a)(3), by striking ``subsection (c)'' in 
        the matter preceding subparagraph (A) and inserting 
        ``subsection (d)''.
  (b) Effective Date.--The amendments made by subsection (a) shall take 
effect as of December 10, 2004, as if enacted immediately after the 
enactment of the Veterans Benefits Improvement Act of 2004 on that 
date.

SEC. 5. NOTIFICATION TO MEMBER'S SPOUSE OR NEXT OF KIN OF CERTAIN 
                    ELECTIONS UNDER SERVICEMEMBERS' GROUP LIFE 
                    INSURANCE PROGRAM.

  (a) Repeal.--Subsections (f) and (g) of section 1012 of division A of 
the Emergency Supplemental Appropriations Act for Defense, the Global 
War on Terror, and Tsunami Relief Act, 2005 (Public Law 109-13), and 
the amendments made by those subsections, are repealed, and sections 
1967 and 1970 of title 38, United States Code, shall be applied as if 
those subsections had not been enacted.
  (b) Notification Required.--Section 1967 of title 38, United States 
Code, is amended by adding at the end the following new subsection:
  ``(f)(1)(A) Whenever a member who is eligible for insurance under 
this subchapter executes a life insurance option specified in 
subparagraph (B), the Secretary concerned shall notify the member's 
spouse or, if the member is unmarried, the member's next of kin, in 
writing, of the execution of that option.
  ``(B) A life insurance option referred to in subparagraph (A) is any 
of the following:
          ``(i) An election under subsection (a)(2)(A) not to be 
        insured under this subchapter.
          ``(ii) An election under subsection (a)(3)(B) for insurance 
        of the member in an amount that is less than the maximum amount 
        provided under subsection (a)(3)(A)(i).
          ``(iii) An application under subsection (c) for insurance 
        coverage under this subchapter or for a change in the amount of 
        such insurance coverage.
          ``(iv) In the case of a married member, a designation under 
        section 1970(a) of this title of any person other than the 
        spouse or a child of the member as the beneficiary of the 
        member for any amount of insurance under this subchapter.
  ``(2) Whenever an unmarried member who is eligible for insurance 
under this subchapter marries, the Secretary concerned shall notify the 
member's spouse in writing as to whether the member is insured under 
this subchapter. In the case of a member who is so insured, the 
Secretary shall include with such notification--
          ``(A) if the member has made an election described in 
        paragraph (1)(B)(ii), notice that the amount of such insurance 
        is less than the maximum amount provided under subsection 
        (a)(3)(A)(i); and
          ``(B) if the member has designated a beneficiary other than 
        the spouse or a child of the member for any amount of such 
        insurance, notice that such a designation has been made.
  ``(3)(A) Notification of a spouse under paragraph (1) or (2), or of 
any other person under paragraph (1), for purposes of this subsection 
shall consist of a good faith effort to provide information to the 
spouse or other person at the last address of the spouse or other 
person known to the Secretary concerned.
  ``(B) Failure to provide such notification, or to provide such 
notification in a timely manner, does not affect the validity of any 
life insurance option referred to in paragraph (1)(B).''.

                              Introduction

    The reported bill reflects the Committee's consideration of 
H.R. 2046, as amended. On May 4, 2005, the Subcommittee on 
Economic Opportunity held a hearing on four bills, including 
H.R. 2046, the Servicemembers' Health Insurance Protection Act 
of 2005, introduced on May 3, 2005, by the Chairman and Ranking 
Member of the Committee, Honorable Steve Buyer and Honorable 
Lane Evans, respectively, and the Chairman and Ranking Member 
of the Subcommittee on Economic Opportunity, Honorable John 
Boozman, and Honorable Stephanie Herseth, respectively.
    On May 5, 2005, the Subcommittee on Economic Opportunity 
met and ordered H.R. 2046 reported favorably to the full 
Committee by unanimous voice vote.
    On May 11, 2005, the full Committee met and ordered H.R. 
2046, as amended, reported favorably to the House by unanimous 
voice vote.

                      Summary of the Reported Bill

    H.R. 2046, as amended, would:
    1. Amend the Servicemembers Civil Relief Act to limit 
premium increases on reinstated health insurance coverage of 
servicemembers who are released from active duty.
    2. Amend the Uniformed Services Employment and Reemployment 
Rights Act (USERRA) to preserve employer-sponsored health plan 
reinstatement rights for certain Reserve-component members who 
acquire TRICARE eligibility prior to entering active duty.
    3. Make a technical correction to Public Law 108-454, the 
Veterans Benefits Improvement Act of 2004.
    4. Make a correction to the Servicemembers' Group Life 
Insurance provisions of Public Law 109-13, the Emergency 
Supplemental Appropriations Act for Defense, the Global War on 
Terror, and Tsunami Relief Act, 2005.

                       Background and Discussion

    Limitation on premium increases for reinstated health 
insurance of servicemembers released from active military 
service.--Section 2 of the bill would amend section 704 of the 
Servicemembers Civil Relief Act (SCRA) to limit premium 
increases on reinstated health insurance coverage of 
servicemembers who are released from active duty. Section 704 
provides that a servicemember who is ordered to active duty is 
entitled upon release from active duty to reinstatement of any 
health insurance in effect on the day before such service 
commenced. This amendment would prohibit any increase in 
premiums for such health insurance for the balance of the 
period for which coverage would have been continued had the 
coverage not been terminated. However, a health care insurance 
carrier would be allowed to increase a servicemember's premium 
if such a general premium increase was implemented for persons 
similarly covered during the period between the termination and 
the reinstatement.
    Section 2 would clearly prohibit certain premium increases 
that have been encountered by some servicemembers returning 
from active duty. Section 704 of the SCRA currently contains no 
express provision regarding premium increases. While the 
Committee believes that the basic reinstatement entitlement 
implies that premiums be reinstated at the same rate in effect 
the day before the servicemember entered active duty, the need 
for legislative clarification was brought to the attention of 
the Committee by the Department of Defense after being 
identified by legal assistance programs of the military 
services. This amendment to section 704 would ensure 
servicemembers are treated fairly upon reinstatement of their 
health insurance and are not discouraged by premium increases 
from exercising their reinstatement entitlement rights.
    Preservation of employer-sponsored health plan coverage for 
certain reserve-component members who acquire TRICARE 
eligibility.--Section 3 of the bill would amend section 4317 of 
the Uniformed Services Employment and Reemployment Rights Act 
(USERRA) to preserve employer-sponsored health plan 
reinstatement rights for certain Reserve-component members who 
prior to entering active duty acquire TRICARE eligibility under 
section 1074(d) of title 10, United States Code. This option 
became available by an amendment to the TRICARE authority 
enacted on November 24, 2003. H.R. 2046, as amended, would 
conform the health insurance reinstatement right under USERRA 
to the change in TRICARE.
    According to the Department of Labor, under existing law, 
an employer is only required to provide employees returning 
from active duty with the same employer-sponsored health 
benefits they had when they reported for active duty. Unless 
the employer voluntarily chooses to allow immediate 
reinstatement of coverage, an employee would be required to 
wait for the next open enrollment opportunity provided by the 
employer and could be subject to any exclusion for preexisting 
conditions that may be imposed on new enrollees. This amendment 
to section 4317 of USERRA would cover both employees who did 
not actually report because of cancellation of active duty 
orders and employees who served a period of active duty.

                      Section-by-Section Analysis

    Section 1 of the bill would provide that this Act may be 
cited as the ``Servicemembers' Health Insurance Protection Act 
of 2005.''
    Section 2 of the bill would amend section 704 of the 
Servicemembers Civil Relief Act (50 U.S.C. App. 594) by adding 
at the end a new subsection (e). The new subsection (e) would 
limit health insurance premium increases by limiting the amount 
of the premium for health insurance coverage that was 
terminated by a servicemember. This limitation applies for the 
balance of the period for which coverage would have been 
continued had the coverage not been terminated. The amount 
chargeable for such coverage may not exceed the amount charged 
for coverage before the termination. This new subsection would 
allow an increase in premium to the extent of any general 
increase in the premiums charged by the insurance carrier for 
persons similarly covered by such insurance during the period 
between termination and the reinstatement.
    Section 3(a) of the bill would preserve entitlement to 
employer-sponsored health plan coverage for certain reserve-
component members who acquire TRICARE eligibility. This section 
would continue coverage by amending subsection (a)(1) of 
section 4317 of title 38, United States Code, by inserting 
after ``by reason of service in the uniformed services,'' the 
following: ``or such person becomes eligible for medical and 
dental care under chapter 55 of title 10 by reason of 
subsection (d) of section 1074 of that title,''. As a result, 
any servicemember who becomes eligible for TRICARE benefits 
under title 10 would be entitled to have the employer-sponsored 
health plan reinstated following release from active duty.
    Section 3(b)(1) of the bill would preserve employer-
sponsored health plan coverage for certain reserve-component 
members who acquire TRICARE eligibility by amending subsection 
(b)(1) of section 4317 of title 38, United States Code, by (A) 
inserting after ``by reason of service in the uniformed 
services,'' the following: ``or such person becomes eligible 
for TRICARE under chapter 55 of title 10 by reason of 
subsection (d) of section 1074 of that title,''; and (B) 
inserting ``or eligibility'' before the period at the end of 
the first sentence.
    Section 3(b)(2) of the bill would preserve employer-
sponsored health plan coverage for certain reserve-component 
members who acquire TRICARE eligibility. This section 
reinstates coverage by adding at the end of subsection (b) of 
section 4317 of title 38, United States Code, a new paragraph 
(3).
    Paragraph (3) of the bill would protect a person who 
chooses to terminate coverage under the employer-sponsored 
health plan by reason of the person having become eligible for 
TRICARE under chapter 55 of title 10 by reason of subsection 
(d) of section 1074 of that title but who subsequently does not 
commence a period of active duty because the order is canceled 
before such active duty commences. In such cases, the 
provisions of subsection (b) relating to any exclusion or 
waiting period in connection with the reinstatement of coverage 
under an employer-sponsored health plan would apply to such 
person's continued employment, upon the termination of such 
eligibility for TRICARE under chapter 55 of title 10, in the 
same manner as if the person had actually reported and was 
reemployed following release from active duty.
    Section 4(a) of the bill would make a technical correction 
to section 2101 of title 38, United States Code, as amended by 
section 401 of the Veterans Benefits Improvement Act of 2004 
(Public Law 108-454).
    Section 4(b) of the bill would make section 4(a) effective 
as of December 10, 2004, as if enacted immediately after the 
enactment of the Veterans Benefits Improvements Act of 2004.
    Section 5(b) of the bill would amend section 1967 of title 
38, United States Code, to add a new requirement requiring 
notification of elections under the Servicemembers' Group Life 
Insurance program. The Secretary concerned would be required to 
notify, in writing, the servicemember's spouse or, if 
unmarried, the servicemember's next of kin, when certain life 
insurance options have been executed. The notification would 
include whether the servicemember (1) declined to be insured 
under section 1967 of title 38, United States Code, (2) elected 
an amount of insurance that is less than the maximum amount, 
(3) made any change in the amount of coverage previously 
elected, and (4) in the case of a married servicemember, the 
designation under section 1970(a) of title 38, United States 
Code, of any person other than the spouse or child of the 
servicemember as beneficiary. When an unmarried servicemember 
who is eligible for insurance marries, the Secretary concerned 
would be required to notify the spouse if (1) the 
servicemember's coverage amount is less than the maximum, and 
(2) someone other than the spouse or child has been designated 
the beneficiary. The Secretary concerned would be required to 
make a good faith effort to provide information to the spouse 
or other person at the last known address, but failure to 
provide notification in a timely manner would not affect the 
validity of any life insurance option.

                    Performance Goals and Objectives

    The reported bill would authorize additional protections to 
Reserve and National Guard members under the Servicemembers 
Civil Relief Act and the Uniformed Services Employment and 
Reemployment Rights Act. The effectiveness and adequacy of 
these rights and protections with SCRA and USERRA are subject 
to the Committee's regular oversight.

             Statements of the Views of the Administration



statement of john m. mcwilliam, deputy assistant secretary of labor for 
  veterans' employment and training service, u.s. department of labor


    Chairman Boozman, Ranking Member Herseth, and distinguished 
members of the subcommittee:
    It is my honor to appear before this subcommittee today on 
behalf of Secretary Elaine Chao. My testimony today covers four 
areas: H.R. 419, the ``Hire Veterans Act'' (a bill to extend 
the authorization of the President's National Hire Veterans 
Committee (PNHVC)); and three draft bills: the ``Homeless 
Veterans Reintegration Program Reauthorization Act of 2005,'' 
the ``Servicemembers'' Health Insurance Protection Act of 
2005,'' and the ``Servicemembers Taxation Protection Act of 
2005.''

           *       *       *       *       *       *       *

    The Servicemembers' Health Insurance Protection Act of 2005 
extends USERRA's continuation coverage protections to 
individuals subject to a delayed-effective-date active-duty 
order who elect TRICARE coverage before they commence military 
service. The draft bill also protects such persons against the 
risk of an exclusion or waiting period upon reinstatement in 
their employment-based health plan if the duty orders are 
cancelled. The proposal makes clear that the employment-based 
health plan may not impose an exclusion or waiting period on 
such employees when they seek reinstatement in the plan, either 
upon reemployment following military service or in the 
situation where their civilian employment is continued because 
the military orders were cancelled prior to mobilization.
    However, the draft bill does not address the situation of 
service members who continue TRICARE coverage after 
reemployment, rather than promptly seeking reinstatement under 
their employment-based health plan. Section 4317(b)(1) of 
USERRA provides that an exclusion or waiting period may not be 
imposed in connection with the reinstatement of a service 
member in the employment-based health plan upon reemployment, 
but does not clearly cover the situation where the service 
member seeks reinstatement in the employment-based plan at a 
point in time after he or she is reemployed. We would like to 
offer to provide technical assistance to the committee to 
ensure that any amendment addresses both the front-end and 
back-end issues relating to extended TRICARE coverage under 
section 4317.

           *       *       *       *       *       *       *



testimony of craig w. duehring, principal deputy assistant secretary of 
                        defense reserve affairs


    Mr. Chairman and members of the Subcommittee, thank you for 
giving me the opportunity to come before you this afternoon to 
discuss several proposed improvements to the Servicemembers 
Civil Relief Act (SCRA) and the Uniformed Services Employment 
and Reemployment Rights Act (USERRA).

           *       *       *       *       *       *       *

    The Department of Defense supports enactment of the 
Servicemembers' Health Insurance Protection Act of 2005 and the 
Servicemembers' Taxation Protection Act of 2005, both of which 
would amend several provisions of the SCRA to reflect our 
experience with the SCRA during its first seventeen months. The 
proposed amendments in both draft bills address problems that 
have been encountered by servicemembers and brought to the 
attention of the Department through the legal assistance 
programs of the Military Services. Legal assistance attorneys 
play a key role in ensuring that servicemembers are able to 
fully exercise the rights and protections afforded by the SCRA, 
and we have been attentive to their experiences during the 
first year under the new law.

           *       *       *       *       *       *       *

    The Servicemembers' Health Insurance Protection Act of 2005 
addresses problems we have noted in the SCRA and in USERRA, 
both relating to health insurance. Section 2 of that Act would 
amend section 704 of the SCRA (50 U.S.C. App. Sec. 594) to 
prevent unfair rate increases in a returning servicemember's 
health insurance. The SCRA and USERRA both guarantee to a 
servicemember who is returning to civilian life the right to 
reinstate civilian health insurance policies he or she may have 
had before departing for military service. The SCRA is silent, 
however, as to the rate at which such reinstated coverage is 
available. Section 2 of the Servicemembers' Health Insurance 
Protection Act would require reinstated coverage to be made 
available at either the same rate as pre-service coverage, or 
at a rate no higher than general increases charged by the 
carrier for similar health insurance. This prevents the carrier 
from offering reinstated coverage at a rate so high as to 
discourage a returning servicemember from using the reinstated 
coverage. I would note that section 703 of the SCRA (50 U.S.C. 
App. Sec. 593) provides exactly this type of protection for 
doctors, dentists, and other health care professionals, with 
respect to professional liability insurance. Section 2 of the 
draft bill would provide servicemember patients the same cost 
guarantees that their doctors now enjoy under the SCRA.
    Section 3 of the Servicemembers' Health Insurance 
Protection Act of 2005 offers a technical correction to address 
two groups of servicemembers who fall into gaps in coverage 
provided by the Uniformed Services Employment and Reemployment 
Rights Act's (USERRA's) right to immediate reinstatement of 
health coverage. First, some reservists who are notified or 
alerted that they may be called to active duty choose to 
terminate their employer-sponsored health coverage early 
(before entering military service) and enroll in the military 
TRICARE plan immediately upon notification. Since such 
reservists technically have no employer-sponsored health 
coverage when they actually leave to perform military duty, 
they are not entitled to immediate reinstatement when they 
return from military service. Second, other reservists who are 
notified or alerted that they may be called to active duty are 
not ultimately brought onto active duty. Under existing law, 
such reservists who terminate employer-sponsored health 
coverage are not entitled to elect immediate reinstatement, 
since they actually do not go onto active duty. (The right of 
immediate reinstatement is predicated on serving on military 
duty for some length of time.) Section 3 of the bill corrects 
these gaps in coverage and makes clear that both of these 
groups of reservists are entitled to immediate reinstatement in 
employer-sponsored health plans under 38 U.S.C. Sec. 4317. 
Immediate reinstatement under Sec. 4317 is important because it 
prevents gaps in coverage and the potential exclusions for so-
called ``pre-existing'' conditions that such gaps in coverage 
may create.

           *       *       *       *       *       *       *


               Congressional Budget Office Cost Estimate

    The following letter was received from the Congressional 
Budget Office concerning the cost of the reported bill:

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, May 16, 2005.
Hon. Steve Buyer,
Chairman, Committee on Veterans' Affairs,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 2046, the 
Servicemembers' Health Insurance Protection Act of 2005.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Michelle S. 
Patterson.
            Sincerely,
                                     Douglas Holtz-Eakin, Director.
    Enclosure.

H.R. 2046--Servicemembers' Health Insurance Protection Act of 2005

    H.R. 2046 would limit premium increases on health insurance 
for reservists who return to their civilian jobs after serving 
on active duty and ensure that reservists whose activation is 
cancelled before they report for duty can reinstate their 
health care coverage. It also would allow disabled 
servicemembers to qualify for a housing grant provided by the 
Department of Veterans Affairs (VA) before being discharged 
from active duty. Finally, the bill would modify a requirement 
in the Emergency Supplemental Appropriations Act for Defense, 
the Global War on Terror, and Tsunami Relief Act, 2005 (Public 
Law 109-113) regarding elections of servicemembers to reduce or 
decline insurance.
    The VA currently administers two grant programs (with 
direct spending authority) to assist severely disabled veterans 
in acquiring housing that is adapted to their disabilities, or 
in modifying their existing housing. The maximum amounts of 
these two grants are $50,000 and $10,000, respectfully. Section 
4 would allow members of the armed forces who become severely 
disabled to receive these grants while still on active duty. 
Because the eligibility requirements for these grants are very 
restrictive, CBO believes that very few servicemembers would 
qualify, and that these servicemembers would be separating from 
the military within 12 months of the time they become eligible 
for these grants. Thus, this section would simply shift their 
eligibility forward by six months, on average. On that basis, 
CBO estimates enacting this bill would increase direct spending 
for these grants by less than $500,000 over the 2006-2015 
period. (Enacting the bill would have no effect on revenues.)
    H.R. 2046 contains both intergovernmental and private-
sector mandates as defined in the Unfunded Mandates Reform Act 
(UMRA). Current law imposes a mandate on public and private-
sector entities that provide health insurance by requiring them 
to allow servicemembers and reservists on active duty to 
continue policies or reinstate those policies without delay 
when they return from service. Section 2 would prohibit those 
entities that provide insurance from raising premiums for 
servicemembers when they return from active-duty service and 
choose to reinstate or continue previously held policies.
    Section 3 of this bill would expand current law to require 
that certain reservists whose notice for active duty is later 
canceled are also eligible to continue or reinstate health 
policies without delay. That expansion would increase the cost 
for both public and private-sector providers to comply with an 
existing mandate.
    Based on information from the Department of Defense and 
industry representatives, CBO estimates that only a small 
number of servicemembers would benefit from those provisions. 
The total direct cost for providers to comply with those 
mandates, thus would be minimal and well below the annual 
thresholds established by UMRA ($62 million in 2005 and $123 
million in 2005, respectively, adjusted annually for 
inflation).
    This estimate was prepared by Michelle S. Patterson, and 
approved by Peter H. Fontaine, Deputy Assistant Director for 
Budget Analysis.

                     Statement of Federal Mandates

    The preceding Congressional Budget Office (CBO) cost 
estimate states that H.R. 2046 contains both intergovernmental 
and private-sector mandates as defined in the Unfunded Mandates 
Reform Act (UMRA). However, according to CBO, because of the 
small number of servicemembers who would benefit from the 
provisions, the costs for compliance would be well below the 
annual thresholds established by UMRA.

                 Statement of Constitutional Authority

    Pursuant to Article I, section 8 of the United States 
Constitution, the reported bill is authorized by Congress' 
power to ``provide for the common Defense and general Welfare 
of the United States.''

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

           SECTION 704 OF THE SERVICEMEMBERS CIVIL RELIEF ACT


SEC. 704. HEALTH INSURANCE REINSTATEMENT.

  (a) * * *
  (b) No Exclusion or Waiting Period.--The reinstatement of 
health care insurance coverage for the health or physical 
condition of a servicemember described in subsection (a), or 
any other person who is covered by the insurance by reason of 
the coverage of the servicemember, shall not be subject to an 
exclusion or a waiting period, if--
          (1) * * *

           *       *       *       *       *       *       *

          (3) [if the] in a case in which the condition relates 
        to the servicemember, the condition has not been 
        determined by the Secretary of Veterans Affairs to be a 
        disability incurred or aggravated in the line of duty 
        (within the meaning of section 105 of title 38, United 
        States Code).

           *       *       *       *       *       *       *

  (e) Limitation on Premium Increases.--
          (1) Premium protection.--The amount of the premium 
        for health insurance coverage that was terminated by a 
        servicemember and required to be reinstated under 
        subsection (a) may not be increased, for the balance of 
        the period for which coverage would have been continued 
        had the coverage not been terminated, to an amount 
        greater than the amount chargeable for such coverage 
        before the termination.
          (2) Increases of general applicability not 
        precluded.--Paragraph (1) does not prevent an increase 
        in premium to the extent of any general increase in the 
        premiums charged by the carrier of the health care 
        insurance for the same health insurance coverage for 
        persons similarly covered by such insurance during the 
        period between the termination and the reinstatement.
                              ----------                              


TITLE 38, UNITED STATES CODE

           *       *       *       *       *       *       *



PART II--GENERAL BENEFITS

           *       *       *       *       *       *       *



CHAPTER 19--INSURANCE

           *       *       *       *       *       *       *



SUBCHAPTER III--SERVICEMEMBERS' GROUP LIFE INSURANCE

           *       *       *       *       *       *       *



Sec. 1967. Persons insured; amount

  (a) * * *

           *       *       *       *       *       *       *

  (f)(1)(A) Whenever a member who is eligible for insurance 
under this subchapter executes a life insurance option 
specified in subparagraph (B), the Secretary concerned shall 
notify the member's spouse or, if the member is unmarried, the 
member's next of kin, in writing, of the execution of that 
option.
  (B) A life insurance option referred to in subparagraph (A) 
is any of the following:
          (i) An election under subsection (a)(2)(A) not to be 
        insured under this subchapter.
          (ii) An election under subsection (a)(3)(B) for 
        insurance of the member in an amount that is less than 
        the maximum amount provided under subsection 
        (a)(3)(A)(i).
          (iii) An application under subsection (c) for 
        insurance coverage under this subchapter or for a 
        change in the amount of such insurance coverage.
          (iv) In the case of a married member, a designation 
        under section 1970(a) of this title of any person other 
        than the spouse or a child of the member as the 
        beneficiary of the member for any amount of insurance 
        under this subchapter.
  (2) Whenever an unmarried member who is eligible for 
insurance under this subchapter marries, the Secretary 
concerned shall notify the member's spouse in writing as to 
whether the member is insured under this subchapter. In the 
case of a member who is so insured, the Secretary shall include 
with such notification--
          (A) if the member has made an election described in 
        paragraph (1)(B)(ii), notice that the amount of such 
        insurance is less than the maximum amount provided 
        under subsection (a)(3)(A)(i); and
          (B) if the member has designated a beneficiary other 
        than the spouse or a child of the member for any amount 
        of such insurance, notice that such a designation has 
        been made.
  (3)(A) Notification of a spouse under paragraph (1) or (2), 
or of any other person under paragraph (1), for purposes of 
this subsection shall consist of a good faith effort to provide 
information to the spouse or other person at the last address 
of the spouse or other person known to the Secretary concerned.
  (B) Failure to provide such notification, or to provide such 
notification in a timely manner, does not affect the validity 
of any life insurance option referred to in paragraph (1)(B).

           *       *       *       *       *       *       *


CHAPTER 21--SPECIALLY ADAPTED HOUSING FOR DISABLED VETERANS

           *       *       *       *       *       *       *



Sec. 2101. Veterans eligible for assistance

  (a) Acquisition of Housing With Special Features.--(1) * * *

           *       *       *       *       *       *       *

  (3) The regulations prescribed under [subsection (c)] 
subsection (d) shall require that assistance under paragraph 
(1) may be provided to a veteran only if the Secretary finds 
that--
          (A) * * *

           *       *       *       *       *       *       *

  (c)(1) The Secretary may provide assistance under subsection 
(a) to a member of the Armed Forces serving on active duty who 
is suffering from a disability described in subparagraph (A), 
(B), (C), or (D) of paragraph (2) of that subsection if such 
disability is the result of an injury incurred or disease 
contracted in or aggravated in line of duty in the active 
military, naval, or air service. Such assistance shall be 
provided to the same extent as assistance is provided under 
that subsection to veterans eligible for assistance under that 
subsection and subject to the requirements of paragraph (3) of 
that subsection.
  (2) The Secretary may provide assistance under subsection (b) 
to a member of the Armed Forces serving on active duty who is 
suffering from a disability described in subparagraph (A) or 
(B) of paragraph (2) of that subsection if such disability is 
the result of an injury incurred or disease contracted in or 
aggravated in line of duty in the active military, naval, or 
air service. Such assistance shall be provided to the same 
extent as assistance is provided under that subsection to 
veterans eligible for assistance under that subsection and 
subject to the requirements of paragraph (3) of that 
subsection.
  [(c)] (d) Regulations.--Assistance under this section shall 
be provided in accordance with such regulations as the 
Secretary may prescribe.

           *       *       *       *       *       *       *


PART III--READJUSTMENT AND RELATED BENEFITS

           *       *       *       *       *       *       *



   CHAPTER 43--EMPLOYMENT AND REEMPLOYMENT RIGHTS OF MEMBERS OF THE 
UNIFORMED SERVICES

           *       *       *       *       *       *       *



  SUBCHAPTER II--EMPLOYMENT AND REEMPLOYMENT RIGHTS AND LIMITATIONS; 
PROHIBITIONS

           *       *       *       *       *       *       *



Sec. 4317. Health plans

  (a)(1) In any case in which a person (or the person's 
dependents) has coverage under a health plan in connection with 
the person's position of employment, including a group health 
plan (as defined in section 607(1) of the Employee Retirement 
Income Security Act of 1974), and such person is absent from 
such position of employment by reason of service in the 
uniformed services, or such person becomes eligible for medical 
and dental care under chapter 55 of title 10 by reason of 
subsection (d) of section 1074 of that title, the plan shall 
provide that the person may elect to continue such coverage as 
provided in this subsection. The maximum period of coverage of 
a person and the person's dependents under such an election 
shall be the lesser of--
          (A) * * *

           *       *       *       *       *       *       *

  (b)(1) Except as provided in paragraph (2), in the case of a 
person whose coverage under a health plan was terminated by 
reason of service in the uniformed services, or by reason of 
the person's having become eligible for medical and dental care 
under chapter 55 of title 10 by reason of subsection (d) of 
section 1074 of that title, an exclusion or waiting period may 
not be imposed in connection with the reinstatement of such 
coverage upon reemployment under this chapter if an exclusion 
or waiting period would not have been imposed under a health 
plan had coverage of such person by such plan not been 
terminated as a result of such service or eligibility. This 
paragraph applies to the person who is reemployed and to any 
individual who is covered by such plan by reason of the 
reinstatement of the coverage of such person.

           *       *       *       *       *       *       *

  (3) In the case of a person whose coverage under a health 
plan is terminated by reason of the person having become 
eligible for medical and dental care under chapter 55 of title 
10 by reason of subsection (d) of section 1074 of that title 
but who subsequently does not commence a period of active duty 
under the order to active duty that established such 
eligibility because the order is canceled before such active 
duty commences, the provisions of paragraph (1) relating to any 
exclusion or waiting period in connection with the 
reinstatement of coverage under a health plan shall apply to 
such person's continued employment, upon the termination of 
such eligibility for medical and dental care under chapter 55 
of title 10 that is incident to the cancellation of such order, 
in the same manner as if the person had become reemployed upon 
such termination of eligibility.

           *       *       *       *       *       *       *

                              ----------                              


 EMERGENCY SUPPLEMENTAL APPROPRIATIONS ACT FOR DEFENSE, THE GLOBAL WAR 
                  ON TERROR, AND TSUNAMI RELIEF, 2005


(Division A of Public Law 109-13)

           *       *       *       *       *       *       *


DIVISION A--EMERGENCY SUPPLEMENTAL APPROPRIATIONS ACT FOR DEFENSE, THE 
             GLOBAL WAR ON TERROR, AND TSUNAMI RELIEF, 2005

That the following sums are appropriated, out of any money in 
the Treasury not otherwise appropriated, for the fiscal year 
ending September 30, 2005, and for other purposes, namely:

TITLE I--DEFENSE-RELATED APPROPRIATIONS

           *       *       *       *       *       *       *



                     GENERAL PROVISIONS, THIS TITLE


                  SERVICEMEMBERS' GROUP LIFE INSURANCE

  Sec. 1012. (a) * * *

           *       *       *       *       *       *       *

  [(f) Requirements Regarding Elections of Members to Reduce or 
Decline Insurance.--Section 1967(a) of such title is further 
amended--
          [(1) in paragraph (2), by adding at the end the 
        following new subparagraph:
  [``(C) Pursuant to regulations prescribed by the Secretary of 
Defense, notice of an election of a member with a spouse not to 
be insured under this subchapter, or to be insured under this 
subchapter in an amount less than the maximum amount provided 
under paragraph (3)(A)(i)(I), shall be provided to the spouse 
of the member.''; and
          [(2) in paragraph (3)--
                  [(A) in the matter preceding clause (i), by 
                striking ``and (C)'' and inserting ``, (C), and 
                (D)''; and
                  [(B) by adding at the end the following new 
                subparagraphs:
  [``(D) A member with a spouse may not elect not to be insured 
under this subchapter, or to be insured under this subchapter 
in an amount less than the maximum amount provided under 
subparagraph (A)(i)(I), without the written consent of the 
spouse.
  [``(E) Whenever a member who is not married elects not to be 
insured under this subchapter, or to be insured under this 
subchapter in an amount less than the maximum amount provided 
for under subparagraph (A)(i)(I), the Secretary concerned shall 
provide a notice of such election to any person designated by 
the member as a beneficiary or designated as the member's next-
of-kin for the purpose of emergency notification, as determined 
under regulations prescribed by the Secretary of Defense.''.
  [(g) Requirement Regarding Redesignation of Beneficiaries.--
Section 1970 of such title is amended by adding at the end the 
following new subsection:
  [``(j) A member with a spouse may not modify the beneficiary 
or beneficiaries designated by the member under subsection (a) 
without providing written notice of such modification to the 
spouse.''.]

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