A bill to provide for the certification of programs to provide uninsured employees of small businesses access to health coverage, and for other purposes.

Summary: Health Care Access for Small Businesses Act of 2004 - Amends the Social Security Act to create a new title XXII to address health insurance coverage for small businesses.

Requires the Secretary of Health and Human Services, acting through the Administrator of the Health Resources and Services Administration, to award grants for the startup and operation of 50 eligible three-share (three-way health insurance premium sharing between employer, employee, and the community) pilot programs for a five-year period.

Authorizes the use of grants to establish three-share programs, provide for contributions to premiums assessed for coverage under such programs, and establish risk pools.

Requires grant applicants to: (1) be either nonprofits or local governmental entities; (2) define the program's service region; (3) have the capacity to carry out administrative functions associated with managing health plans; and (4) have demonstrated community involvement.

Requires programs to pay for the costs of services through monthly premiums, divided according to specified percentages.

Sets forth minimal coverage requirements for three-share program eligibility.

Requires the Administrator to develop a formula to determine which businesses qualify as distressed businesses for purposes of this Act.

Directs the General Accounting Office to submit a report to the Secretary and appropriate congressional committees after the grant period has ended.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Health Care Access for Small 
Businesses Act of 2004''.

SEC. 2. THREE-SHARE PROGRAMS.

    The Social Security Act (42 U.S.C. 301 et seq.) is amended by 
adding at the end the following:

               ``TITLE XXII--PROVIDING FOR THE UNINSURED

``SEC. 2201. THREE-SHARE PROGRAMS.

    ``(a) Pilot Programs.--The Secretary, acting through the 
Administrator, shall award grants under this section for the startup 
and operation of 50 eligible three-share pilot programs for a 5-year 
period.
    ``(b) Grants for Three-Share Programs.--
            ``(1) Establishment.--The Administrator may award grants to 
        eligible entities--
                    ``(A) to establish three-share programs;
                    ``(B) to provide for contributions to the premiums 
                assessed for coverage under a three-share program as 
                provided for in subsection (c)(2)(B)(iii); and
                    ``(C) to establish risk pools.
            ``(2) Three-share program plan.--Each entity desiring a 
        grant under this subsection shall develop a plan for the 
        establishment and operation of a three-share program that meets 
        the requirements of paragraphs (2) and (3) of subsection (c).
            ``(3) Application.--Each entity desiring a grant under this 
        subsection shall submit an application to the Administrator at 
        such time, in such manner and containing such information as 
        the Administrator may require, including--
                    ``(A) the three-share program plan described in 
                paragraph (2); and
                    ``(B) an assurance that the eligible entity will--
                            ``(i) determine a benefit package;
                            ``(ii) recruit businesses and employees for 
                        the three-share program;
                            ``(iii) build and manage a network of 
                        health providers or contract with an existing 
                        network or licensed insurance provider;
                            ``(iv) manage all administrative needs; and
                            ``(v) establish relationships among 
                        community, business, and provider interests.
            ``(4) Priority.--In awarding grants under this section the 
        Secretary shall give priority to an applicant--
                    ``(A) that is an existing three-share program;
                    ``(B) that is an eligible three-share program that 
                has demonstrated community support; or
                    ``(C) that is located in a State with insurance 
                laws and regulations that permit three-share program 
                expansion.
    ``(c) Grant Eligibility.--
            ``(1) In general.--The Secretary, acting through the 
        Administrator, shall promulgate regulations providing for the 
        eligibility of three-share programs for participation in the 
        pilot program under this section.
            ``(2) Three-share program requirements.--
                    ``(A) In general.--To be determined to be an 
                eligible three-share program for purposes of 
                participation in the pilot program under this section a 
                three-share program shall--
                            ``(i) be either a non-profit or local 
                        governmental entity;
                            ``(ii) define the region in which such 
                        program will provide services;
                            ``(iii) have the capacity to carry out 
                        administrative functions of managing health 
                        plans, including monthly billings, 
                        verification/enrollment of eligible employers 
                        and employees, maintenance of membership 
                        rosters, development of member materials (such 
                        as handbooks and identification cards), 
                        customer service, and claims processing; and
                            ``(iv) have demonstrated community 
                        involvement.
                    ``(B) Payment.--To be eligible under paragraph (1), 
                a three-share program shall pay the costs of services 
                provided under subparagraph (A)(ii) by charging a 
                monthly premium for each covered individual to be 
                divided as follows:
                            ``(i) Not more than 30 percent of such 
                        premium shall be paid by a qualified employee 
                        desiring coverage under the three-share 
                        program.
                            ``(ii) Not more than 30 percent of such 
                        premium shall be paid by the qualified employer 
                        of such a qualified employee.
                            ``(iii) At least 40 percent of such premium 
                        shall be paid from amounts provided under a 
                        grant under this section.
                            ``(iv) Any remaining amount shall be paid 
                        by the three-share program from other public, 
                        private, or charitable sources.
                    ``(C) Program flexibility.--A three-share program 
                may set an income eligibility guideline for enrollment 
                purposes.
            ``(3) Coverage.--
                    ``(A) In general.--To be an eligible three-share 
                program under this section, the three-share program 
                shall provide at least the following benefits:
                            ``(i) Physicians services.
                            ``(ii) In-patient hospital services.
                            ``(iii) Out-patient services.
                            ``(iv) Emergency room visits.
                            ``(v) Emergency ambulance services.
                            ``(vi) Diagnostic lab fees and x-rays.
                            ``(vii) Prescription drug benefits.
                    ``(B) Limitation.--Nothing in subparagraph (A) 
                shall be construed to require that a three-share 
                program provide coverage for services performed outside 
                the region described in paragraph (2)(A)(i).
                    ``(C) Preexisting conditions.--A program described 
                in subparagraph (A) shall not be an eligible three-
                share program under paragraph (1) if any individual can 
                be excluded from coverage under such program because of 
a preexisting health condition.
    ``(d) Grants for Existing Three-Share Programs To Meet 
Certification Requirements.--
            ``(1) In general.--The Administrator may award grants to 
        three-share programs that are operating on the date of 
        enactment of this section.
            ``(2) Application.--Each eligible entity desiring a grant 
        under this subsection shall submit an application to the 
        Administrator at such time, in such manner, and containing such 
        information as the Administrator may require.
    ``(e) Application of State Laws.--Nothing in this section shall be 
construed to preempt State law.
    ``(f) Distressed Business Formula.--
            ``(1) In general.--Not later than 60 days after the date of 
        enactment of this section, the Administrator of the Health 
        Resources and Services Administration shall develop a formula 
        to determine which businesses qualify as distressed businesses 
        for purposes of this section.
            ``(2) Effect on insurance market.--Granting eligibility to 
        a distressed business using the formula under paragraph (1) 
        shall not interfere with the insurance market. Any business 
        found to have reduced benefits to qualify as a distressed 
        business under the formula under paragraph (1) shall not be 
        eligible to be a three-share program for purposes of this 
        section.
    ``(g) Definitions.--In this section:
            ``(1) Administrator.--The term `Administrator' means the 
        Administrator of the Health Resources and Services 
        Administration.
            ``(2) Covered individual.--The term `covered individual' 
        means--
                    ``(A) a qualified employee; or
                    ``(B) a child under the age of 23 or a spouse of 
                such qualified employee who--
                            ``(i) lacks access to health care coverage 
                        through their employment or employer;
                            ``(ii) lacks access to health coverage 
                        through a family member;
                            ``(iii) is not eligible for coverage under 
                        the medicare program under title XVIII or the 
                        medicaid program under title XIX; and
                            ``(iv) does not qualify for benefits under 
                        the State Children's Health Insurance Program 
                        under title XXI.
            ``(3) Distressed business.--The term `distressed business' 
        means a business that--
                    ``(A) in light of economic hardship and rising 
                health care premiums may be forced to discontinue or 
                scale back its health care coverage; and
                    ``(B) qualifies as a distressed business according 
                to the formula under subsection (g).
            ``(4) Eligible entity.--The term `eligible entity' means an 
        entity that meets the requirements of subsection (a)(2)(A).
            ``(5) Qualified employee.--The term `qualified employee' 
        means any individual employed by a qualified employer who meets 
        certain criteria including--
                    ``(A) lacking access to health coverage through a 
                family member or common law partner;
                    ``(B) not being eligible for coverage under the 
                medicare program under title XVIII or the medicaid 
                program under title XIX; and
                    ``(C) agreeing that the share of fees described in 
                subsection (a)(2)(B)(i) shall be paid in the form of 
                payroll deductions from the wages of such individual.
            ``(6) Qualified employer.--The term `qualified employer' 
        means an employer as defined in section 3(d) of the Fair Labor 
        Standards Act of 1938 (29 U.S.C. 203(d)) who--
                    ``(A) is a small business concern as defined in 
                section 3(a) of the Small Business Act (15 U.S.C. 632);
                    ``(B) is located in the region described in 
                subsection (a)(2)(A)(i); and
                    ``(C) has not contributed to the health care 
                benefits of its employees for at least 12 months 
                consecutively or currently provides insurance but is 
                classified as a distressed business.
    ``(h) Evaluation.--Not later than 90 days after the end of the 5-
year period during which grants are available under this section, the 
General Accounting Office shall submit to the Secretary and the 
appropriate committees of Congress a report concerning--
            ``(1) the effectiveness of the programs established under 
        this section;
            ``(2) the number of individuals covered under such 
        programs;
            ``(3) any resulting best practices; and
            ``(4) the level of community involvement.
    ``(i) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section $100,000,000 for each of fiscal 
years 2005 through 2010.''.