    [Public Papers of the Presidents of the United States: William J. Clinton (1996, Book II)]
    [August 21, 1996]
    [Pages 1322-1323]
    [From the U.S. Government Publishing Office www.gpo.gov]

    [[Page 1322]]

    Statement on Signing the Health Insurance Portability and Accountability
    Act of 1996
    August 21, 1996

        I am pleased to sign into law H.R. 3103, the ``Health Insurance
    Portability and Accountability Act of 1996.'' For the first time, this
    Act will ensure the portability of health benefits when workers change
    or lose their jobs and will protect workers against discrimination by
    health plans based on their health status.
        For too long, tens of millions of Americans have been denied health
    insurance coverage because they have preexisting conditions. We have all
    heard their stories.
            --  A husband and his pregnant wife lose their insurance and
                then find they cannot buy new coverage because her pregnancy
                is considered a preexisting condition.
            --  A young woman starting out in her career cannot accept a
                promotion with another company because its health insurance
                policy won't cover her diabetes.
            --  A small business owner faithfully pays his group health
                insurance premiums for years only to learn that his coverage
                won't be renewed after one of his employees develops a heart
                condition.
        Since taking office, I have been fighting for changes that would
    stop this kind of unfairness and make health insurance more accessible
    for all people, including the most needy. I am pleased that the Congress
    has responded to my call. In passing this Act, a modest but important
    step has been taken to improve Americans' access to health care
    coverage.
        This legislation will set into motion several key reforms. First, it
    will eliminate the possibility that individuals can be denied coverage
    because they have a preexisting medical condition. Second, it will
    require insurance companies to sell coverage to small employer groups
    and to individuals who lose group coverage without regard to their
    health risk status. Finally, it will require insurers to renew the
    policies they sell to groups and individuals.
        In addition to the health insurance reforms, this legislation will
    help strengthen other aspects of our health care system.
            --  It increases the tax deductibility of health insurance
                premiums for the self-employed and their dependents from 30
                percent to 80 percent by calendar year 2006.
            --  It significantly expands Federal authority and resources to
                combat fraud and abuse in Federal health programs, such as
                Medicare, and in the private sector.
            --  It provides for the development of: (1) national standards
                for the electronic submission of health insurance claims
                that will reduce paperwork, administrative costs, and
                burdens for doctors and hospitals; and (2) privacy
                protection recommendations for health information generally,
                and, in the absence of additional legislation, regulations
                for privacy of health care claims information.
            --  It establishes consumer protection standards for certain
                long-term care insurance policies and provides tax
                clarifications to make those policies more affordable and
                available.
        Like most legislation, this Act includes compromises that are less
    than perfect. For example, it includes a provision that will allow a
    limited number of individuals covered by catastrophic health insurance
    to establish tax-advantaged medical savings accounts, or MSAs. I opposed
    an open-ended, unconstrained expansion of MSAs because of my concern
    that MSAs may create incentives for healthier people to select
    catastrophic health coverage, which experts believe would increase
    premiums for those who choose traditional, comprehensive health care
    policies. I agreed, however, to work with the Congress in crafting a
    compromise that would permit the establishment of a limited number of
    MSAs. This limited use of MSAs will be studied carefully for a period of
    4 years before deciding whether or not to expand them to the broader
    health insurance market, and the Congress will have to consider this
    issue and vote again before doing so.
        Similarly, while the bill makes some of the positive changes that I
    have proposed to strengthen our efforts to combat health care fraud and
    abuse, I am concerned that it also contains a provision that could
    weaken those efforts. I oppose the requirement that Govern-

    [[Page 1323]]

    ment officials provide advisory opinions on whether certain arrangements
    violate criminal health fraud statutes. The Attorney General and the
    Secretary of Health and Human Services are concerned that advisory
    opinions of this nature could create complexities that would burden the
    efforts to enforce laws against health care fraud and abuse. Therefore,
    I am directing the Departments of Justice and Health and Human Services
    to work closely together in implementing this provision to ensure that
    it promotes and protects Federal law enforcement activities relating to
    health care fraud.
        Finally, I want to reiterate my disappointment that the Congress
    dropped from this legislation the mental health parity provision that
    received such bipartisan support in the Senate. Individuals with mental
    illness have long suffered from discrimination in health plans that
    impose severe financial burdens on top of the illnesses they already
    face. I urge the Congress to act at the earliest opportunity to require
    parity in health insurance coverage for mental health services. I look
    forward to working with the Congress to address this critical issue.
        As I sign this legislation, I am particularly grateful to Senators
    Kassebaum and Kennedy and the many other Members of Congress who worked
    tirelessly to assure that this bill is a meaningful and important step
    toward making health care more accessible and more secure for millions
    of Americans. I pledge to continue this effort and hope that the
    Congress will work with me and so that all Americans can have health
    care security.

                                                          William J. Clinton

    The White House,

    August 21, 1996.

    Note: H.R. 3103, approved August 21, was assigned Public Law No. 104-
    191.