[House Report 110-870]
[From the U.S. Government Publishing Office]
110th Congress Rept. 110-870
HOUSE OF REPRESENTATIVES
2d Session Part 1
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HEALTH INSURANCE SOURCE OF INJURY CLARIFICATION ACT OF 2008
_______
September 23, 2008.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
_______
Mr. Dingell, from the Committee on Energy and Commerce, submitted the
following
R E P O R T
[To accompany H.R. 6908]
[Including cost estimate of the Congressional Budget Office]
The Committee on Energy and Commerce, to whom was referred
the bill (H.R. 6908) to require that limitations and
restrictions on coverage under group health plans be timely
disclosed to group health plan sponsors and timely communicated
to participants and beneficiaries under such plans in a form
that is easily understandable, having considered the same,
report favorably thereon without amendment and recommend that
the bill do pass.
CONTENTS
Page
Purpose and Summary.............................................. 2
Background and Need for Legislation.............................. 2
Hearings......................................................... 3
Committee Consideration.......................................... 3
Committee Votes.................................................. 3
Committee Oversight Findings..................................... 3
Statement of General Performance Goals and Objectives............ 3
New Budget Authority, Entitlement Authority, and Tax Expenditures 3
Earmarks and Tax and Tariff Benefits............................. 3
Committee Cost Estimate.......................................... 4
Congressional Budget Office Estimate............................. 4
Federal Mandates Statement....................................... 5
Advisory Committee Statement..................................... 5
Constitutional Authority Statement............................... 5
Applicability to Legislative Branch.............................. 5
Section-by-Section Analysis of the Legislation................... 5
Changes in Existing Law Made by the Bill, as Reported............ 6
Purpose and Summary
The purpose of H.R. 6908, the Health Insurance Source of
Injury Clarification Act of 2008, is to improve transparency in
health insurance benefit restrictions and limitations. H.R.
6908 amends the Employee Retirement Income Security Act of 1974
(ERISA), Public Health Service Act (PHSA), and the Internal
Revenue Code (IRC) to require that any limitations on benefits
of health insurers be explicit and clear; that they be
disclosed to plan sponsors in advance of the point of sale; and
that they be disclosed to participants and beneficiaries in a
manner that is easily understandable in the plan in advance of
enrollment and after enrollment.
Background and Need for Legislation
In January 2001, the Department of Labor (DOL), the
Internal Revenue Service and the Health Care Financing
Administration, issued a rule in accordance to the Health
Insurance Portability and Accountability Act (HIPAA) of 1996.
The rule states that ``[w]hile a person cannot be excluded from
a plan for engaging in certain recreational activities,
benefits for a particular injury can, in some cases, be
excluded based on the source of the injury.''\1\
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\1\Federal Register, Vol. 66, No. 5, Monday, January 8, 2001.
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This rule resulted in situations where a beneficiary was
unaware that injuries resulting from certain recreational
activities could result in non-payment for necessary medical
services. In many situations the exclusions were unclear or
very broad.
The lack of clarity underlying coverage of benefits has
created a confusing situation for individuals that may ride
motorcycles, horses, snowmobiles, or participate in other legal
activities that could result in an injury. Millions of
Americans enjoy these activities safely every year within the
framework of State laws and utilizing proper safety
precautions. However, where an injury results from these
activities, insurers should not discriminate in their treatment
of injured individuals. To the extent plan limitations or
restrictions are permitted, such limitations or restrictions
should be explicit and clear before a person enrolls in a plan.
LEGISLATIVE AND EXECUTIVE HISTORY
H.R. 1076, the HIPAA Recreational Injury Technical
Correction Act, was introduced by Congressman Michael Burgess
(R-TX) and Congressman Bart Stupak (D-MI) on February 15, 2007,
and currently has 122 cosponsors. The Senate companion, S. 616,
was introduced by Senator Susan Collins (R-ME) on February 15,
2007, and has 8 cosponsors.
As introduced, H.R. 1076 would have required plans to cover
payment for medical services resulting from participation of an
individual in a legal mode of transportation or a legal
recreational activity.
In response to concerns raised during discussions on this
bill, the Committee worked with Mr. Burgess and Mr. Stupak on
an alternative policy.
Congressman Burgess and Stupak introduced new legislation,
H.R. 6908, that would:
Require any limitations and restrictions on
benefits be explicit and clear;
Require that they be disclosed to the
sponsor of the group health plan in advance of the
point of sale to the group health plan; and
Require that the issuer of the health
insurance coverage make available to participants and
beneficiaries in an easily understandable manner a
description of the limitations and restrictions prior
to and upon their enrollment.
Hearings
No hearings were held in connection with H.R. 6908.
Committee Consideration
On Wednesday, September 17, 2008, the full Committee met in
open markup session and ordered H.R. 6908 favorably reported to
the House, by a voice vote. No amendments were offered during
full Committee consideration of the bill.
Committee Votes
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee to list the record votes
on the motion to report legislation and amendments thereto. No
record votes were taken in connection with ordering H.R. 6908
reported to the House. A motion by Mr. Dingell to order H.R.
6908 favorably reported to the House was agreed to by a voice
vote.
Committee Oversight Findings
Regarding clause 3(c)(1) of rule XIII of the Rules of the
House of Representatives, the oversight findings of the
Committee regarding H.R. 6908 are reflected in this report.
Statement Of General Performance Goals And Objectives
The objective of H.R. 6908 is to ensure that consumers are
informed of any limitations and restrictions on their health
insurance coverage.
New Budget Authority, Entitlement Authority, and Tax Expenditures
Regarding compliance with clause 3(c)(2) of rule XIII of
the Rules of the House of Representatives, the Committee finds
that H.R. 6908 would result in no new or increased budget
authority, entitlement authority, or tax expenditures or
revenues.
Earmarks and Tax and Tariff Benefits
Regarding compliance with clause 9 of rule XXI of the Rules
of the House of Representatives, H.R. 6908 does not contain any
congressional earmarks, limited tax benefits, or limited tariff
benefits as defined in clause 9(d), 9(e), or 9(f) of rule XXI.
Committee Cost Estimate
The Committee adopts as its own the cost estimate on H.R.
6908 prepared by the Director of the Congressional Budget
Office pursuant to section 402 of the Congressional Budget Act
of 1974.
Congressional Budget Office Estimate
Pursuant to clause 3(c)(3) of rule XIII of the Rules of the
House of Representatives, the following is the cost estimate on
H.R. 6908 provided by the Congressional Budget Office pursuant
to section 402 of the Congressional Budget Act of 1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, September 22, 2008.
Hon. John D. Dingell,
Chairman, Committee on Energy and Commerce,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 6908, the Health
Insurance Source of Injury Clarification Act of 2008.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Kirstin
Nelson.
Sincerely,
Robert A. Sunshine
(For Peter R. Orszag, Director).
Enclosure.
H.R. 6908--Health Insurance Source of Injury Clarification Act of 2008
H.R. 6908, the Health Insurance Source of Injury
Clarification Act of 2008, would require that group health
plans disclose the limitations and restrictions on coverage in
a timely manner to health plan sponsors and participants. The
bill would amend the Employee Retirement and Income Security
Act of 1974, the Public Health Service Act, and the Internal
Revenue Code to reflect this new requirement. The bill would
require that health insurance coverage limitations and
restrictions be explicit and clear prior to the time of sale or
enrollment. CBO estimates that enacting H.R. 6908 would not
affect the federal budget.
H.R. 6908 would impose a private-sector mandate, as defined
in the Unfunded Mandates Reform Act (UMRA), on issuers of group
health insurance coverage and sponsors of group health
insurance plans. CBO estimates that the aggregate cost of
complying with those mandates would not exceed the threshold
established by UMRA for private-sector mandates ($136 million
in 2008, adjusted annually for inflation). CBO estimates that
the direct cost of these requirements would be small because
issuers and sponsors of group health insurance plans generally
already make such information available and already disclose
plan information before and after enrollment. Making that
information more explicit would not, in and of itself, be
costly.
H.R. 6908 contains no intergovernmental mandates as defined
in UMRA. An existing provision in the Public Health Service Act
would allow state, local, and tribal governments, as employers
that provide health benefits to their employees, to opt out of
the requirements of this bill. Consequently, the requirements
in the bill that would require plans to disclose coverage
limits for injuries by source would not be an intergovernmental
mandate as defined in UMRA. The bill would affect the budgets
of those governments only if they choose to comply with the
requirements for their group health plans.
The CBO staff contacts for this estimate are Kirstin Nelson
(for federal costs); Lisa Ramirez-Branum (for the impact on
state, local, and tribal governments); and Patrick Bernhardt
(for the private-sector impact). This estimate was approved by
Keith J. Fontenot, Deputy Assistant Director for Health and
Human Services, Budget Analysis Division.
Federal Mandates Statement
The Committee adopts as its own the estimate of Federal
mandates regarding H.R. 6908 prepared by the Director of the
Congressional Budget Office pursuant to section 423 of the
Unfunded Mandates Reform Act.
Advisory Committee Statement
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act would be created by H.R.
6908.
Constitutional Authority Statement
Pursuant to clause 3(d)(1) of rule XIII of the Rules of the
House of Representatives, the Committee finds that the
Constitutional authority for H.R. 6908 is provided in Article
I, section 8, clause 3, which grants Congress the power to
regulate commerce with foreign nations, among the several
States, and with the Indian Tribes.
Applicability to Legislative Branch
The Committee finds that H.R. 6908 does not relate to the
terms and conditions of employment or access to public services
or accommodations within the meaning of section 102(b)(3) of
the Congressional Accountability Act of 1995.
Section-by-Section Analysis of the Legislation
Section 1. Short title
Section 1 establishes the short title of H.R. 6908 as the
Health Insurance Source of Injury Clarification Act of 2008.
Section 2. Disclosure requirements
Section 2(a) amends the Employee Retirement Income Security
Act of 1974. This provision is not within the jurisdiction of
the Committee.
Section 2(b) amends the Public Health Service Act relating
to the group market. It amends section 2702 (relating to
prohibiting discrimination against individual participants and
beneficiaries based on health status) in subsection (a)(2)(B)
to provide that paragraph (1) of subsection (a) shall not be
construed to prevent a plan or coverage from establishing
limitations or restrictions on the amount, level, extent, or
nature of the benefits or coverage for similarly situated
individuals enrolled in the plan or coverage so long as:
Such limitations and restrictions are
explicit and clear;
Such limitations and restrictions have been
disclosed to the plan sponsor of the group health plan
in advance of the point of sale to the group health
plan;
The plan sponsor and issuer make available
to participants and beneficiaries in an easily
understandable manner a description of the limitations
and restrictions in advance of the point of their
enrollment under the plan; and
The plan sponsor and issuer make available
to participants and beneficiaries in an easily
understandable manner a description of the limitations
and restrictions upon their enrollment.
Section 2(c) amends the Internal Revenue Code of 1986. This
provision is not within the jurisdiction of the Committee.
Section 2(d) makes these changes applicable with respect to
plan years beginning 1 year after the date of enactment.
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 (new matter is
printed in italic and existing law in which no change is
proposed is shown in roman):
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974
* * * * * * *
TITLE I--PROTECTION OF EMPLOYEE BENEFIT RIGHTS
* * * * * * *
Subtitle B--Regulatory Provisions
* * * * * * *
Part 7--Group Health Plan Requirements
Subpart A--Requirements Relating to Portability, Access, and
Renewability
* * * * * * *
SEC. 702. PROHIBITING DISCRIMINATION AGAINST INDIVIDUAL PARTICIPANTS
AND BENEFICIARIES BASED ON HEALTH STATUS.
(a) In Eligibility To Enroll.--
(1) * * *
(2) No application to benefits or exclusions.--To the
extent consistent with section 701, paragraph (1) shall
not be construed--
(A) * * *
(B) to prevent such a plan or coverage from
establishing limitations or restrictions on the
amount, level, extent, or nature of the
benefits or coverage for similarly situated
individuals enrolled in the plan or coverage so
long as--
(i) such limitations and restrictions
are explicit and clear;
(ii) in the case of such limitations
and restrictions in health insurance
coverage offered in connection with the
group health plan, such limitations and
restrictions have been disclosed to the
plan sponsor in advance of the point of
sale to the plan;
(iii) the plan sponsor and the issuer
of the health insurance coverage make
available, to participants and
beneficiaries in the plan in advance of
the point of their enrollment under the
plan, a description of such limitations
and restrictions in a form that is
easily understandable by such
participants and beneficiaries; and
(iv) the plan sponsor and the issuer
of the coverage provide such
description to participants and
beneficiaries upon their enrollment
under the plan.
* * * * * * *
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PUBLIC HEALTH SERVICE ACT
* * * * * * *
TITLE XXVII--REQUIREMENTS RELATING TO HEALTH INSURANCE COVERAGE
Part A--Group Market Reforms
Subpart 1--Portability, Access, and Renewability Requirements
* * * * * * *
SEC. 2702. PROHIBITING DISCRIMINATION AGAINST INDIVIDUAL PARTICIPANTS
AND BENEFICIARIES BASED ON HEALTH STATUS.
(a) In Eligibility To Enroll.--
(1) * * *
(2) No application to benefits or exclusions.--To the
extent consistent with section 701, paragraph (1) shall
not be construed--
(A) * * *
(B) to prevent such a plan or coverage from
establishing limitations or restrictions on the
amount, level, extent, or nature of the
benefits or coverage for similarly situated
individuals enrolled in the plan or coverage so
long as--
(i) such limitations and restrictions
are explicit and clear;
(ii) in the case of such limitations
and restrictions in health insurance
coverage offered in connection with the
group health plan, such limitations and
restrictions have been disclosed to the
plan sponsor in advance of the point of
sale to the plan;
(iii) the plan sponsor and the issuer
of the group health insurance coverage
make available, to participants and
beneficiaries in the plan in advance of
the point of their enrollment under the
plan, a description of such limitations
and restrictions in a form that is
easily understandable by such
participants and beneficiaries; and
(iv) the plan sponsor and the issuer
of the coverage provides such
description to participants and
beneficiaries upon their enrollment
under the plan.
* * * * * * *
----------
INTERNAL REVENUE CODE OF 1986
* * * * * * *
Subtitle K--Group Health Plan Requirements
* * * * * * *
CHAPTER 100--GROUP HEALTH PLAN REQUIREMENTS
* * * * * * *
Subchapter A--Requirements Relating to Portability, Access, and
Renewability
* * * * * * *
SEC. 9802. PROHIBITING DISCRIMINATION AGAINST INDIVIDUAL PARTICIPANTS
AND BENEFICIARIES BASED ON HEALTH STATUS.
(a) In Eligibility To Enroll.--
(1) * * *
(2) No application to benefits or exclusions.--To the
extent consistent with section 9801, paragraph (1)
shall not be construed--
(A) * * *
(B) to prevent such a plan from establishing
limitations or restrictions on the amount,
level, extent, or nature of the benefits or
coverage for similarly situated individuals
enrolled in the plan or coverage so long as--
(i) such limitations and restrictions
are explicit and clear;
(ii) the group health plan makes
available, to participants and
beneficiaries in the plan in advance of
the point of their enrollment under the
plan, a description of such limitations
and restrictions in a form that is
easily understandable by such
participants and beneficiaries; and
(iii) the plan provides such
description to participants and
beneficiaries upon their enrollment
under the plan.
* * * * * * *