[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.