Life Care Act

Summary: Life Care Act - Amends the Public Health Service Act to add a new title, title XXVII:  Life Care:  Public Insurance Program for Nursing Home Care.  Directs the Secretary of Health and Human Services, under such new title, to establish a voluntary insurance program for individuals 45 years of age and over to cover the nursing home stays of such individuals.  Sets forth provisions of the program concerning: (1) benefits; (2) eligibility; (3) premiums; (4) providers; and (5) reimbursement to nursing homes.  Directs the Secretary to contract with entities to act as Long-Term Care Screening Agencies which shall assess the eligibility of individuals for services under the new title.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Life Care Act''.

SEC. 2. LIFE CARE: PUBLIC INSURANCE PROGRAM FOR NURSING HOME CARE.

    (a) In General.--The Public Health Service Act (42 U.S.C. 201 et 
seq.) is amended--
            (1) by redesignating title XXVII (42 U.S.C. 300cc et seq.) 
        as title XXVIII; and
            (2) by inserting after title XXVI the following new title:

  ``TITLE XXVII--LIFE CARE: PUBLIC INSURANCE PROGRAM FOR NURSING HOME 
                                  CARE

``SEC. 2701. ESTABLISHMENT OF VOLUNTARY LONG-TERM CARE INSURANCE 
              PROGRAM.

    ``The Secretary shall establish a voluntary insurance program for 
individuals 45 years of age and over to cover the nursing home stays of 
such individuals.

``SEC. 2702. BENEFITS.

    ``(a) In General.--Subject to subsection (c), an individual who 
meets the eligibility criteria prescribed in section 2703 shall be 
eligible under the program established under this title for coverage 
for necessary services described in subsection (b) (in the amounts 
described in subsection (c)) that are provided to the individual by a 
nursing facility while the individual is an inpatient of the facility.
    ``(b) Types.--Coverage may be provided under this title for--
            ``(1) nursing care provided by or under the supervision of 
        a registered professional nurse;
            ``(2) physical, occupational, or speech therapy furnished 
        by a facility or by others under arrangements with a facility;
            ``(3) medical social services;
            ``(4) drug, biological, supply, appliance, and equipment 
        for use in the facility, that is ordinarily furnished by the 
        facility for the care and treatment of an inpatient;
            ``(5) medical service of an intern or resident-in-training 
        under an approved teaching program of a hospital with which a 
        facility has in effect a transfer agreement or other diagnostic 
        or therapeutic service provided by a hospital with which a 
        facility has in effect a transfer agreement; and
            ``(6) such other health services necessary to the health of 
        a patient as are generally provided by a nursing home facility.
    ``(c) Coverage Amount.--
            ``(1) In general.--The amount of coverage provided with 
        respect to an eligible individual for the services described in 
        subsection (b) shall, based on an election made by the 
        individual, not exceed $30,000, $60,000, or $90,000 over the 
        lifetime of the eligible individual. Such amounts shall be 
        adjusted by the Secretary to reflect increases in the Consumer 
        Price Index.
            ``(2) Asset protection.--An eligible individual shall be 
        entitled to the asset protection provided under section 2708.
    ``(d) Payment.--Amounts provided under this title with respect to 
an eligible individual for the services described in subsection (b) 
shall be paid from the general fund of the Treasury of the United 
States.

``SEC. 2703. ELIGIBILITY.

    ``(a) In General.--An individual shall be eligible for benefits 
under this title if--
            ``(1) the individual--
                    ``(A) is a legal resident of the United States and 
                has elected coverage under subsection (c);
                    ``(B) has been determined by a Screening Agency 
                through a screening process (conducted in accordance 
                with section 2707)--
                            ``(i)(I) to require hands-on or standby 
                        assistance, supervision, or cueing (as defined 
                        in regulations) to perform three or more 
                        activities of daily living;
                            ``(II) to require hands-on or standby 
                        assistance, supervision, or cueing with at 
                        least such instrumental activity (or 
                        activities) of daily living related to 
                        cognitive or mental impairment as the Secretary 
                        specifies; or
                            ``(III) to display symptoms of one or more 
                        serious behavioral problems (that is on a list 
                        of such problems specified by the Secretary) 
                        which create a need for supervision to prevent 
                        harm to self or others; and
                            ``(ii) to require such assistance, 
                        supervision, or cueing over a period of at 
                        least 100 days; and
                    ``(C) has achieved a score, on a standard mental 
                status protocol (or protocols) appropriate for 
                measuring the individual's particular condition 
                specified by the Secretary, that indicates either 
                severe cognitive impairment or severe mental 
                impairment, or both.
            ``(2)(A) the individual has filed an application for such 
        benefits, and is in need of, benefits covered under this title;
            ``(B) the legal guardian of the individual has filed an 
        application on behalf of an individual who is in need of 
        benefits covered under this title; or
            ``(C) the representative of an individual who is 
        cognitively impaired and who is in need of benefits covered 
        under this title has filed an application on behalf of the 
        individual; and
            ``(3) receiving nursing home services in a nursing facility 
        would be in the best interest of the individual.
    ``(b) Current Individuals.--An individual who is in a hospital or 
nursing home on the date of the enrollment of the individual in the 
program established under this title shall be ineligible for coverage 
under this section until the individual's first spell of illness 
beginning after such date.
    ``(c) Election of Coverage.--
            ``(1) In general.--Subject to this subsection, an 
        individual shall have the option to purchase coverage under 
        this title when the individual is 35 years of age, 45 years of 
        age, 55 years of age, or 65 years of age.
            ``(2) Initial year.--During the 1-year period beginning on 
        the date of enactment of this title, an individual who is 45 
        years of age or older shall be eligible to purchase insurance 
        under this title, except that such an individual shall not be 
        eligible to purchase such insurance--
                    ``(A) while confined to a hospital or nursing home;
                    ``(B) within the 6-month period after the 
                individuals confinement in a nursing home; or
                    ``(C) within the 90-day period after the 
                individuals confinement in a hospital.
        Individuals described in the matter preceding subparagraph (A) 
        shall become eligible to receive benefits under this title on 
        the expiration of the 3-year period beginning on the date such 
        individuals purchase insurance under this title.
            ``(3) Extension beyond initial year.--If an individual is 
        confined to a nursing home or hospital during a period that 
        extends beyond the first year after the effective date of this 
        title, an individual shall be eligible to enroll in the program 
        established by this title during the 60-day period beginning 
        after the individual's spell of illness.
            ``(4) Subsequent years.--During years subsequent to the 1-
        year period referred to in paragraph (2), an individual shall 
        be eligible to purchase insurance under this title within 6 
        months of the 45th, 55th or 65th birthday of the individual.
            ``(5) Activation of benefits.--To receive coverage under 
        the insurance program established by this title, an individual 
        shall have purchased such coverage not later than 1 month prior 
        to admission to a nursing facility, unless the reason for the 
        need of services is a result of an accident or stroke 
        subsequent to the date that such individual enrolled for 
        coverage under this title.

``SEC. 2704. PREMIUM RATES.

    ``(a) In General.--The Secretary shall determine one premium rate 
for individuals electing to purchase coverage under this title at age 
45 (or between the ages of 45 and 54 during the initial enrollment 
period), a separate rate for those individuals who elect such coverage 
at age 55 (or between that ages of 55 and 64 during the initial 
enrollment period), and a separate rate for those individuals who elect 
such coverage at age 65 (or at age 65 and over during the initial 
enrollment period).
    ``(b) Revision.--The Secretary shall revise premium rates annually 
to increase such rates to reflect the amount of the increase in the 
cost of living adjustment with respect to benefits under title II of 
the Social Security Act.
    ``(c) Rates.--In developing premium rates under the program 
established under this title, the Secretary shall establish rates that 
are expected to cover 100 percent of the estimated costs of nursing 
home stays for those individuals enrolled in the program.
    ``(d) Waiver.--An individual electing to purchase coverage under 
this title shall not be required to pay premiums during any period in 
which such individual is receiving benefits under this title.
    ``(e) Payment.--Premiums shall be paid under this section into the 
general fund of the Treasury of the United States.

``SEC. 2705. QUALIFIED SERVICE PROVIDERS.

    ``(a) In General.--To be considered as a covered nursing home 
service under this title, such service must have been provided by a 
qualified service provider.
    ``(b) Types.--A provider shall be considered a qualified service 
provider under this title if the provider is a nursing facility that is 
certified by the State and meets the requirements of this title and any 
other standards established by the Secretary by regulation for the safe 
and efficient provision of services covered under this title.

``SEC. 2706. REIMBURSEMENT.

    ``(a) Amount.--Monthly reimbursement for nursing facility services 
under this title shall equal 65 percent of the amount the Secretary 
determines to be reasonable and appropriate to cover the cost of care 
provided under this title, taking into account the average cost of 
providing appropriate care in the most efficient manner.
    ``(b) Prospective Payment.--To the extent feasible, the Secretary 
shall establish a prospective payment mechanism for payment for nursing 
home services under this title that takes into account the expected 
resource utilization of individual patients based on their degree of 
disability and other factors determining service requirements.
    ``(c) Room and Board Payment.--An individual receiving benefits 
under this program shall be responsible for the payment of an amount 
for room and board that is equal to--
            ``(1) with respect to the initial 6 months of confinement 
        to a nursing facility, 20 percent of the average per diem rate 
        paid by the Secretary to nursing facilities receiving 
        reimbursement under this title; and
            ``(2) with respect to subsequent periods of confinement, 35 
        percent of the average per diem rate paid by the Secretary to 
        nursing facilities receiving reimbursement under this title.
    ``(d) Priority Payers.--Notwithstanding any other provision of this 
title, reimbursement for nursing facility services provided under this 
title to an individual shall, to the extent available, be made under 
the Medicare program, under Department of Veterans Affairs' programs, 
or under private insurance policies prior to reimbursement under this 
title.

``SEC. 2707. LONG-TERM CARE SCREENING AGENCY.

    ``(a) Establishment.--The Secretary shall contract with entities to 
act as Long-Term Care Screening Agencies (hereafter referred to in this 
title as the `Screening Agency') for each designated area of a State. 
It shall be the responsibility of such agency to assess the eligibility 
of individuals residing in the geographic jurisdiction of the Agency, 
for services provided under this title according to the requirements of 
this title and regulations prescribed by the Secretary. In entering 
into such contracts, the Secretary shall give preference to State 
governmental entities.
    ``(b) Eligibility.--The Screening Agency shall determine the 
eligibility of an individual under this title based on the results of a 
preliminary telephone interview or written questionnaire (completed by 
the applicant, by the caregiver of the applicant, or by the legal 
guardian or representative of the applicant) that shall be validated 
through the use of a screening tool administered in person to each 
applicant determined eligible through initial telephone or written 
questionnaire interviews not later than 15 days from the date on which 
such individual initially applied for services under this title.
    ``(c) Questionnaires and Screening Tools.--
            ``(1) In general.--The Secretary shall establish a 
        telephone or written questionnaire and a screening tool to be 
        used by the Screening Agency to determine the eligibility of an 
        individual for services under this title consistent with 
        requirements of this title and the standards established by the 
        Secretary by regulation.
            ``(2) Questionnaires.--The questionnaire shall include 
        questions about the functional impairment, mental status, and 
        living arrangement of an individual and other criteria that the 
        Secretary shall prescribe by regulation.
            ``(3) Screening tools.--The screening tool should measure 
        functional impairment caused by physical or cognitive 
        conditions as well as information concerning cognition 
        disability, behavioral problems (such as wandering or abusive 
        and aggressive behavior), the living arrangement of an 
        individual, availability of caregivers, and any other criteria 
        that the Secretary shall prescribe by regulation. The screening 
        tool shall be administered in person.
    ``(d) Notification.--Not later than 15 days after the date on which 
an individual initially applied for services under this title (by 
telephone or written questionnaire), the Screening Agency shall notify 
such individual that such individual is not eligible for benefits, or 
that such individuals must schedule an in-person screening to determine 
final eligibility for benefits under this title. The Screening Agency 
shall notify such individual of its final decision not later than 2 
working days after the in-person screening.
    ``(e) In-Person Screening.--An individual (or the legal guardian or 
representative of such individual) whose application for benefits under 
this title is denied on the basis of information provided through a 
telephone or written questionnaire, shall be notified of such 
individual's right to an in-person screening by a nurse or appropriate 
health care professionals.
    ``(f) Appeals.--The Secretary shall establish a mechanism for 
hearings and appeals in cases in which individuals contest the 
eligibility findings of the Screening Agency.

``SEC. 2708. RELATION TO TITLE XIX OF THE SOCIAL SECURITY ACT; ASSET 
              PROTECTION.

    ``Notwithstanding any other provision of law, the assets an 
eligible individual may retain and continue to be determined eligible 
for nursing facility benefits under State Medicaid programs (in 
accordance with section 1902(a)(10)) shall be increased by the amount 
of coverage ($30,000, $60,000, or $90,000) elected under section 2702.

``SEC. 2709. RELATION TO PRIVATE INSURANCE.

    ``(a) In General.--Except as provided in subsection (b), an insurer 
may not offer a health insurance policy to an individual covered under 
this title if the coverage under such policy duplicates the coverage 
provided under this title.
    ``(b) Development of Standard Packages.--The Secretary shall 
develop standard health insurance benefits packages that insurers may 
offer to individuals receiving benefits under this title. Such packages 
shall provide coverage for benefits that compliment, but do not 
duplicate, those covered under this title.

``SEC. 2710. DEFINITIONS.

    ``As used in this title:
            ``(1) Activity of daily living.--The term `activity of 
        daily living' includes:
                    ``(A) Bathing.--Getting water and cleansing the 
                whole body, including turning on the water for a bath, 
                shower, or sponge bath, getting to, in, and out of a 
                tub or shower, and washing and drying oneself;
                    ``(B) Dressing.--Getting clothes from closets and 
                drawers and then getting dressed, including putting on 
                braces or other devices and fastening buttons, zippers, 
                snaps, or other closures, selecting appropriate attire, 
                and dressing in the proper order;
                    ``(C) Toileting.--Going to a bathroom for bowel and 
                bladder function, transferring on and off the toilet, 
                cleaning after elimination, and arranging clothes;
                    ``(D) Transferring.--Moving in and out of bed and 
                in and out of a chair or wheelchair; or
                    ``(E) Eating.--Transferring food from a plate or 
                its equivalent into the body, including cutting food so 
                as to make possible safe ingestion.
            ``(2) Nursing facility.--The term `nursing facility' 
        means--
                    ``(A) a skilled nursing facility (as defined in 
                section 1819(a) of the Social Security Act); or
                    ``(B) a facility that is a nursing facility (as 
                defined in section 1919(a) of such Act) which meets the 
                requirements of section 1819(b)(4)(C) of such Act 
                (relating to nursing care).
            ``(3) Spell of illness.--The term `spell of illness' means 
        a period of consecutive days beginning with the first day on 
        which an individual is furnished services as an inpatient in a 
        hospital or nursing facility and ending with the close of the 
        first 6 consecutive months thereafter during which the 
        individual is no longer an inpatient of a nursing facility, or 
        90 days after the individual is no longer an inpatient in a 
        hospital.''.
    (b) Conforming Amendments.--
            (1) Sections 2701 through 2714 of the Public Health Service 
        Act (42 U.S.C. 300cc through 300cc-15) are redesignated as 
        sections 2801 through 2814, respectively.
            (2) Sections 465(f) and 497 of such Act (42 U.S.C. 286(f) 
        and 289(f)) are amended by striking out ``2701'' each place 
        that such appears and inserting in lieu thereof ``2801''.