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# Legislative Bulletin.................................................May 1, 2008

**Contents:**

**H.R. 493**---Genetic Information Non-Discrimination Act (as amended)

H.R. 493---Genetic Information Non-Discrimination Act of 2007

*(Slaughter, D-NY)*

**[Order of Business]{.underline}**: The Senate amendments to the bill
are reportedly scheduled to be considered on Thursday, May 1, 2008,
subject to a closed rule that provides for one hour of general debate on
the Senate amendments and waives all points of order against the
amendments (except those arising under PAYGO).

**[Summary]{.underline}**: H.R. 493 would prohibit the use of genetic
information by employers in employment decisions and by health insurers
and health plans in making enrollment determinations and setting
insurance premiums. The specific provisions of the bill as amended by
the Senate are summarized below.

-   Amends the Employee Retirement Income Security Act (ERISA), the
    Public Health Service Act, and the Internal Revenue Code to prohibit
    a group health plan, and a health insurance issuer offering group
    health insurance coverage in connection with a group health plan,
    from the following:

    -   Adjusting premium or contribution amounts for the group covered
        under the plan on the basis of genetic information;

    -   Requiring an individual or a family member to undergo a genetic
        test;

    -   Requesting, requiring, or purchasing genetic information for
        underwriting purposes; and

    -   Requesting, requiring, or purchasing genetic information with
        respect to any individual prior to that individual's enrollment
        under the plan or coverage in connection with their enrollment.

> The bill allows for certain research exceptions to the above
> prohibitions.

-   Defines an individual or a family member for purposes of this Act
    as:

    -   The fetus inside of a pregnant mother; and

    -   Any embryo legally held by the individual or family member (with
        respect to assisted reproductive technology).

-   Defines genetic test as: "an analysis of human DNA, RNA,
    chromosomes, proteins, or metabolites, that detects genotypes,
    mutations, or chromosomal changes." The definition does not include
    the following:

    -   "An analysis of proteins or metabolites that does not detect
        genotypes, mutations, or chromosomal changes; or

    -   "An analysis of proteins or metabolites that is directly related
        to a manifested disease, disorder, or pathological condition
        that could reasonably be detected by a health care professional
        with appropriate training and expertise in the field of medicine
        involved."

-   Imposes a penalty against any plan sponsor or group health plan for
    failure to meet requirements with respect to genetic information in
    connection with their health plan. The penalty would be \$100 each
    day in noncompliance with respect to each participant to whom such
    failure relates. Under certain circumstances, the penalty could not
    be less than \$15,000 per participant. In addition, the Secretary
    could waive the penalty under certain circumstances.

-   Prohibits a health insurance issuer in the individual market from
    doing the following:

    -   Establishing rules for the eligibility of any individual to
        enroll in individual health insurance coverage based on genetic
        information;

    -   Adjusting premium or contribution amounts for an individual on
        the basis of genetic information concerning the individual or a
        family member;

    -   Imposing any preexisting condition exclusion based on the basis
        of genetic information, with respect to their coverage;

    -   Requesting or requiring an individual or family member to
        undergo a genetic test;

    -   Requesting, requiring or purchasing genetic information for
        underwriting purposes; and

    -   Collecting genetic information with respect to any individual
        prior to the individual's enrollment under the plan.

-   Prohibits an issuer of a Medicare supplemental policy from the
    following:

    -   Denying or conditioning the issuance of a policy and from
        discriminating in the pricing of the policy of an individual on
        the basis of genetic information;

    -   Requesting or requiring individuals to undergo genetic tests;
        and

    -   Requesting, requiring, or purchasing genetic information during
        underwriting.

-   Directs the National Association of Insurance Commissioners (NAIC)
    to modify its NAIC model regulations to mirror the above
    prohibitions required by this Act.

-   Directs the Secretary of Health and Human Services to revise the
    Health Insurance Portability and Accountability Act (HIPAA) private
    regulations to be consistent with provisions in this Act, affecting
    the use of genetic information.

-   Prohibits employers, employment agencies, and labor organizations
    from the following:

    -   Refusing to hire an employee or discriminating against an
        employee because of genetic information related to that
        individual;

    -   Limiting, segregating or classifying employees in any way that
        would deprive or adversely affect the status of the employee due
        to their genetic information; and

    -   Requiring or purchasing genetic information, except in certain
        circumstances.

-   Requires employers, employment agencies, and labor organizations to
    maintain any genetic information about employees or members as
    confidential, subject to certain exceptions.

-   Provides for remedies with the Equal Employment Opportunity
    Commission (EEOC) against employers who engage in discriminatory
    employment practices with respect to their employees' genetic
    information.

**[Additional Background on Senate Amendments]{.underline}**: On March
4, 2008, 11 Senators, led by Sen. Tom Coburn (R-OK), sent a letter to
Majority Leader Reid and Senate HELP Committee Chairman Kennedy
outlining remaining conservative concerns regarding passage of the
Genetic Information Non-Discrimination Act (GINA). A summary of those
concerns, along with the ways in which the compromise language addressed
the issues raised in the March 4 letter, follows below.

-   Title I imposes requirements on health plans regarding insurance
    coverage, while Title II imposes requirements on employers regarding
    employment and related hiring decisions. Earlier drafts of the bill
    did not include language clarifying that group health insurance plan
    sponsors may not be subjected to the more expansive remedies
    provided by Title II, which provides for rulemaking by the Equal
    Employment Opportunity Commission (EEOC), and remedies before the
    same body and, ultimately, federal courts. This "firewall" provision
    was incorporated into the Senate agreement, which should ensure that
    the broader remedies available in Title II will be used only against
    employers who violate their employees' civil rights, not for
    employees seeking to litigate group health plan disputes.

-   The Senate agreement maintained language in the original
    House-passed bill ensuring that entities covered under the Health
    Insurance Portability and Accountability Act (HIPAA) privacy
    regulations can continue to communicate medical and genetic
    information consistent with the HIPAA statute without facing a
    separate and potentially conflicting regulatory regime under GINA.

-   The Senate agreement also includes clear language excluding
    "manifested" diseases from GINA's provisions. In general, health
    plans can receive information about whether an individual has a
    manifested disease, and these facts can be used during the
    underwriting process for individual and small group coverage in some
    states. By maintaining current law clarity, the agreement's language
    would maintain long-established underwriting processes for
    already-occurring health conditions---while providing protections
    for genetic information for diseases not yet manifest in patients.

-   Lastly, as a result of efforts by the Congressional Pro-Life Caucus,
    the Senate agreement maintained language in the House-passed bill
    extending GINA protections to any fetus carried by pregnant women or
    any embryos held by individuals or family members. Maintaining this
    language ensures that families will not have an economic incentive
    to abort their unborn children, fearing that they could be
    discriminated against due to results from prenatal testing. Groups
    such as Family Research Council and the National Conference of
    Catholic Bishops have endorsed the compromise Senate language for
    this reason.

To the extent that concerns still remain regarding the GINA language,
they revolve primarily around the strength of the "firewall" language,
and the lack of a general-purpose "business necessity" exemption for
companies that may find a legitimate need to utilize genetic information
for a reason not expressly authorized within the statute. Some business
groups also question whether and to what extent genetic
non-discrimination legislation is necessary, particularly as insurers
are currently prohibited from such discrimination. Nevertheless, the
significant progress made on the concerns outlined by Sen. Coburn and
his colleagues outweighed any lingering concerns, leading the Senate to
approve the bill by a 95-0 vote.

**[Legislative History]{.underline}**: H.R. 493 was introduced on
January 16, 2007, and referred to the House Committees on Education and
Labor, Energy and Commerce, and Ways and Means. The Education and Labor
Committee held a mark-up and reported the bill, as amended, by voice
vote on February 14, 2007. The Energy and Commerce Committee held a
mark-up and reported the bill, as amended, on March 23, 2007. The Ways
and Means Committee held a mark-up and reported the bill, as amended, by
voice vote on March 21, 2007. The bill was passed on April 25, 2007, by
a vote of 420-3. On April 24, 2008, the Senate passed the bill with an
amendment by a 95-0 vote.

**[Cost to Taxpayers]{.underline}**: According to CBO, enacting H.R. 493
"would increase the number of individuals who obtain health insurance by
about 600 people per year, nearly all of whom would obtain insurance in
the individual market. The bill would affect federal revenues because
the premiums paid by some of those newly insured individuals would be
tax-deductible." As such, CBO estimates that the bill would reduce
revenues by less than \$500,000 in each year from 2008 through 2017, by
\$1 million over the 2008-2012 period, and by \$2 million over the 2008
through 2017 period.

In addition, CBO states that "the bill's requirements would apply to
Medicare supplemental insurance, which would affect direct spending for
Medicare." However, CBO estimates that the bill would have no
significant effect on direct spending. Finally, CBO estimates that H.R.
493 would result in discretionary costs of less than \$500,000 in FY
2008, and \$2 million over the FY 2008 through FY 2017 period.

**[Does the Bill Expand the Size and Scope of the Federal
Government?]{.underline}**: Yes, the bill grants authority to the
Secretaries of Health and Human Services, Labor, and Treasury to
promulgate regulations and engage in enforcement activities with respect
to the Title I provisions relating to health insurance coverage.

**[Does the Bill Contain Any New State-Government, Local-Government, or
Private-Sector Mandates?]{.underline}**: Yes. According to CBO, the bill
would "preempt some state laws that establish confidentiality standards
for genetic information, and would restrict how state and local
governments use such information in employment practices and in the
provision of health care to employees." In addition, CBO explains that
the bill "contains private-sector mandates on health insurers, health
plans, employers, labor unions, and other organizations." In both cases,
however, CBO does not believe that the cost of the mandates would exceed
thresholds established in the Unfunded Mandates Reform Act (\$66 million
and \$131 million in 2007, respectively, adjusted for inflation).

**RSC Staff Contact**: Chris Jacobs;
<christopher.jacobs@mail.house.gov>; (202) 226-8585.