Federal Tort Claims Act Malpractice Coverage for Health Centers Extension Act of 1995

SECTION. 1. SHORT TITLE; FINDINGS; REFERENCE.

    (a) Short Title.--This Act may be cited as the ``Federal Tort 
Claims Act Malpractice Coverage for Health Centers Extension Act of 
1995''.
    (b) Reference.--Except as otherwise expressly provided, whenever in 
this Act an amendment or repeal is expressed in terms of an amendment 
to, or repeal of, a section or other provision, the reference shall be 
considered to be made to a section or other provision of the Public 
Health Service Act.

SEC. 2. PERMANENT EXTENSION OF PROGRAM.

    (a) In General.--Section 224(g) (42 U.S.C. 233 (g)) is amended by 
striking the last sentence of paragraph (3).
    (b) Conforming Amendments.--
            (1) Section 224(k)(1)(A) (42 U.S.C. 233(k)(1)(A)) is 
        amended by striking ``each of the fiscal years 1993, 1994, and 
        1995'' and inserting ``each fiscal year''.
            (2) Section 224(k)(2) (42 U.S.C. 233(k)(2)) is amended by 
        striking ``each of the fiscal years 1993, 1994, and 1995'' and 
        inserting ``each fiscal year''.

SEC. 3. CLARIFICATION OF COVERAGE.

    Section 224(g)(1) (42 U.S.C. 233(g)(1)) is amended--
            (1) in the first sentence, by striking ``officer, employee, 
        or contractor'' and inserting ``officer, governing board 
        member, or employee of such an entity, and any contractor''; 
        and
            (2) in the second sentence, by inserting after ``officer,'' 
        the following ``governing board member,''.

SEC. 4. COVERAGE FOR SERVICES FURNISHED TO INDIVIDUALS OTHER THAN 
              CENTER PATIENTS.

    Section 224(g) (42 U.S.C. 233(g)) is amended--
            (1) by redesignating paragraph (1) as paragraph (1)(A); and
            (2) by adding at the end thereof the following:
    ``(B) The deeming of any entity or officer, governing board member, 
employee, or contractor of the entity to be an employee of the Public 
Health Service under subparagraph (A) shall apply with respect to 
services provided--
            ``(i) to all patients of the entity, and
            ``(ii) subject to subparagraph (C), to individuals who are 
        not patients of the entity.
    ``(C) Subparagraph (B)(ii) applies to services provided to 
individuals who are not patients of an entity if the Secretary 
determines, after reviewing an application submitted under subparagraph 
(D), that the provision of the services to such individuals--
            ``(i) benefits patients of the entity and general 
        populations that could be served by the entity through 
        community-wide intervention efforts within the communities 
        served by such entity;
            ``(ii) facilitates the provision of services to patients of 
        the entity; or
            ``(iii) are otherwise required under an employment contract 
        (or similar arrangement) between the entity and an officer, 
        governing board member, employee, or contractor of the 
        entity.''.

SEC. 5. APPLICATION PROCESS.

    (a) Application Requirement.--Section 224(g)(1) (42 U.S.C. 
233(g)(1)) (as amended by section 4) is further amended--
            (1) in subparagraph (A), by inserting ``and subject to the 
        approval by the Secretary of an application under subparagraph 
        (D)'' after ``For purposes of this section''; and
            (2) by adding at the end thereof the following new 
        subparagraphs:
    ``(D) The Secretary may not deem an entity or an officer, governing 
board member, employee, or contractor of the entity to be an employee 
of the Public Health Service under subparagraph (A), and may not apply 
such deeming to services described in subparagraph (B)(ii), unless the 
entity has submitted an application for such deeming to the Secretary 
in such form and such manner as the Secretary shall prescribe. The 
application shall contain detailed information, along with supporting 
documentation, to verify that the entity, and the officer, governing 
board member, employee, or contractor of the entity, as the case may 
be, meets the requirements of subparagraphs (B) and (C) of this 
paragraph and that the entity meets the requirements of paragraphs (1) 
through (4) of subsection (h).
    ``(E) The Secretary shall make a determination of whether an entity 
or an officer, governing board member, employee, or contractor of the 
entity is deemed to be an employee of the Public Health Service for 
purposes of this section within 30 days after the receipt of an 
application under subparagraph (D). The determination of the Secretary 
that an entity or an officer, governing board member, employee, or 
contractor of the entity is deemed to be an employee of the Public 
Health Service for purposes of this section shall apply for the period 
specified by the Secretary under subparagraph (A).
    ``(F) Once the Secretary makes a determination that an entity or an 
officer, governing board member, employee, or contractor of an entity 
is deemed to be an employee of the Public Health Service for purposes 
of this section, the determination shall be final and binding upon the 
Secretary and the Attorney General and other parties to any civil 
action or proceeding. Except as provided in subsection (i), the 
Secretary and the Attorney General may not determine that the provision 
of services which are the subject of such a determination are not 
covered under this section.''.
    (b) Approval Process.--Section 224(h) (42 U.S.C. 233(h)) is 
amended--
            (1) by striking the matter preceding paragraph (1) and 
        inserting the following: ``The Secretary may not approve an 
        application under subsection (g)(1)(D) unless the Secretary 
        determines that the entity--''; and
            (2) by striking ``has fully cooperated'' in paragraph (4) 
        and inserting ``will fully cooperate''.

SEC. 6. TIMELY RESPONSE TO FILING OF ACTION OR PROCEEDING.

    Section 224 (42 U.S.C. 233) is amended by adding at the end thereof 
the following new subsection:
    ``(l)(1) If a civil action or proceeding is filed in a State court 
against any entity described in subsection (g)(4) or any officer, 
governing board member, employee, or any contractor of such an entity 
for damages described in subsection (a), the Attorney General, within 
15 days after being notified of such filing, shall make an appearance 
in such court and advise such court as to whether the Secretary has 
determined under subsections (g) and (h), that such entity, officer, 
governing board member, employee, or contractor of the entity is deemed 
to be an employee of the Public Health Service for purposes of this 
section with respect to the actions or omissions that are the subject 
of such civil action or proceeding. Such advice shall be deemed to 
satisfy the provisions of subsection (c) that the Attorney General 
certify that an entity, officer, governing board member, employee, or 
contractor of the entity was acting within the scope of their 
employment or responsibility.
    ``(2) If the Attorney General fails to appear in a State court 
within the time period prescribed under paragraph (1), upon petition of 
any entity or officer, governing board member, employee, or contractor 
of the entity named, the civil action or proceeding shall be removed to 
the appropriate United States district court. The civil action or 
proceeding shall be stayed in such court until such court conducts a 
hearing, and makes a determination, as to the appropriate forum or 
procedure for the assertion of the claim for damages described in 
subsection (a) and issues an order consistent with such 
determination.''.

SEC. 7. APPLICATION OF COVERAGE TO MANAGED CARE PLANS.

    Section 224 (42 U.S.C. 233) (as amended by section 6) is further 
amended by adding at the end the following new subsection:
    ``(m)(1) An entity described in subsection (g)(4) or an officer, 
governing board member, employee, or contractor of such an entity 
shall, for purposes of this section, be deemed to be an employee of the 
Public Health Service with respect to services provided to individuals 
who are enrollees of a managed care plan if the entity contracts with 
such managed care plan for the provision of services.
    ``(2) Each managed care plan which enters into a contract with an 
entity described in subsection (g)(4) shall deem the entity and any 
officer, governing board member, employee, or contractor of the entity 
as meeting whatever malpractice coverage requirements such plan may 
require of contracting providers for a calendar year if such entity or 
officer, governing board member, employee, or contractor of the entity 
has been deemed to be an employee of the Public Health Service for 
purposes of this section for such calendar year. Any plan which is 
found by the Secretary on the record, after notice and an opportunity 
for a full and fair hearing, to have violated this subsection shall, 
upon such finding cease, for a period to be determined by the 
Secretary, to receive and to be eligible to receive any Federal funds 
under title XVIII or XIX of the Social Security Act.
    ``(3) For purposes of this subsection, the term `managed care plan' 
shall mean health maintenance organizations and similar entities that 
contract at-risk with payors for the provision of health services to 
plan enrollees and which contract with providers (such as entities 
described in subsection (g)(4)) for the delivery of such services to 
plan enrollees.''.

SEC. 8. COVERAGE FOR PART-TIME PROVIDERS UNDER CONTRACTS.

    Subparagraph (B) of section 224(g)(5) (42 U.S.C. 233 (g)(5)(B)) is 
amended to read as follows:
            ``(B) in the case of an individual who normally performs an 
        average of less than 32\1/2\ hours of services per week for the 
        entity for the period of the contract, the individual is a 
        licensed or certified provider of services in the fields of 
        family practice, general internal medicine, general pediatrics, 
        or obstetrics and gynecology.''.

SEC. 9. DUE PROCESS FOR LOSS OF COVERAGE.

    Section 224(i)(1) (42 U.S.C. 233(i)(1)) is amended by striking 
``may determine, after notice and opportunity for a hearing'' and 
inserting ``may on the record determine, after notice and opportunity 
for a full and fair hearing''.

SEC. 10. REPORT ON RISK EXPOSURE OF COVERED ENTITIES.

    (a) In General.--Not later than December 31, 1997, the General 
Accounting Office shall submit to the Congress a report on the medical 
malpractice liability claims experience of entities that have been 
deemed to be employees for purposes of section 224 of the Public Health 
Service Act and the risk exposure associated with such entities.
    (b) Contents of Report.--The report required under subsection (a) 
shall include an analysis by the General Accounting Office comparing--
            (1) the estimate of the General Accounting Office of the 
        aggregate amounts that entities described in subsection (a) 
        (together with the officers, governing board members, 
        employees, and contractors of such entities who have been 
        deemed to be employees for purposes of section 224 of the 
        Public Health Service Act) would have paid to obtain medical 
        malpractice liability insurance coverage if such section 224 
        were not in effect; with
            (2) the aggregate amounts by which the grants received by 
        such entities under such section 224 were reduced pursuant to 
        subsection (k)(2) of such section 224.
    (c) Consultation.--In preparing the report under subsection (a), 
the General Accounting Office shall consult with public and private 
entities with expertise on the matters with which the report is 
concerned.

SEC. 11. AMOUNT OF RESERVE FUND.

    Section 224(k)(2) (42 U.S.C. 233(k)(2)) is amended by striking 
``$30,000,000'' and inserting ``$10,000,000''.

Summary: Federal Tort Claims Act Malpractice Coverage for Health Centers Extension Act of 1995 - Amends the Public Health Service Act to remove provisions ending, on a specified date, the application of provisions: (1) deeming health care practitioner officers, employees, or contractors of certain entities to be employees of the Public Health Service (PHS). And (2) making a malpractice action against the United States the sole remedy against such practitioners. Adds governing board members to the list of practitioners deemed to be PHS employees. Allows the practitioners to be considered PHS employees while treating individuals who are not patients of such an entity if the Secretary of Health and Human Services determines, after reviewing the application, that the provision of the services to such individuals: (1) benefits patients of, and general populations that could be served by, the entity through community-wide intervention efforts within the communities served by such entity, (2) facilitates the provision of services to such patients. Or (3) are otherwise required under an employment contract or similar arrangement between the entity and an officer, governing board member, employee, or contractor of the entity. Sets forth an application process. Directs the Attorney General to appear in State court actions to advise the court whether an officer, governing board member, employee, or contractor has been deemed to be an employee of the Public Health Service. Provides for the application of coverage to managed care plans. Revises the requirements: (1) to be considered a contractor of such an entity. And (2) of due process regarding exclusion of specific individuals from coverage. Directs the General Accounting Office to submit to the Congress a report on the medical malpractice liability claims experience of entities that have been deemed to be employees and the risk exposure associated with such entities. Reduces the maximum limit on the fund set up to cover annual estimated claims.