Health Insurance Liability Recovery Protection Act of 2000

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Health Insurance Liability Recovery 
Protection Act of 2000''.

SEC. 2. PATIENT PROTECTION IN CASE OF THIRD PARTY RECOVERIES.

    (a) Group Health Plans.--
            (1) Public health service act amendments.--Subpart 2 of 
        part A of title XXVII of the Public Health Service Act is 
        amended by adding at the end the following new section:

``SEC. 2707. STANDARD RELATING TO PATIENT PROTECTION IN CASE OF THIRD 
              PARTY RECOVERIES.

    ``(a) Requirement.--A group health plan, and a health insurance 
issuer offering group health insurance coverage, may not recover (or 
seek to recover) from a participant or beneficiary more than the 
amounts expended by the plan or issuer on behalf of the participant or 
beneficiary in the case of amounts recovered by such a participant or 
beneficiary as a result of a settlement or judgment in a liability or 
other action.
    ``(b) Notice.--A group health plan under this part shall comply 
with the notice requirement under section 714(b) of the Employee 
Retirement Income Security Act of 1974 with respect to the requirements 
of this section as if such section applied to such plan.''.
            (2) ERISA amendments.--(A) Subpart B of part 7 of subtitle 
        B of title I of the Employee Retirement Income Security Act of 
        1974 is amended by adding at the end the following new section:

``SEC. 714. STANDARD RELATING TO PATIENT PROTECTION IN CASE OF THIRD 
              PARTY RECOVERIES.

    ``(a) Requirement.--A group health plan, and a health insurance 
issuer offering group health insurance coverage, may not recover (or 
seek to recover) from a participant or beneficiary more than the 
amounts expended by the plan or issuer on behalf of the participant or 
beneficiary in the case of amounts recovered by such a participant or 
beneficiary as a result of a settlement or judgment in a liability or 
other action.
    ``(b) Notice Under Group Health Plan.--The imposition of the 
requirement of this section shall be treated as a material modification 
in the terms of the plan described in section 102(a)(1), for purposes 
of assuring notice of such requirements under the plan; except that the 
summary description required to be provided under the last sentence of 
section 104(b)(1) with respect to such modification shall be provided 
by not later than 60 days after the first day of the first plan year in 
which such requirement apply.''.
            (B) Section 732(a) of such Act (29 U.S.C. 1191a(a)) is 
        amended by striking ``section 711'' and inserting ``sections 
        711 and 714''.
            (C) The table of contents in section 1 of such Act is 
        amended by inserting after the item relating to section 713 the 
        following new item:

``Sec. 714. Standard relating to patient protection in case of third 
                            party recoveries.''.
            (3) Internal revenue code amendments.--
                    (A) In general.--Subchapter B of chapter 100 of the 
                Internal Revenue Code of 1986 is amended--
                            (i) in the table of sections, by inserting 
                        after the item relating to section 9812 the 
                        following new item:

                              ``Sec. 9813. Standard relating to patient 
                                        protection in case of third 
                                        party recoveries.''; and
                            (ii) by inserting after section 9812 the 
                        following:

``SEC. 9813. STANDARD RELATING TO PATIENT PROTECTION IN CASE OF THIRD 
              PARTY RECOVERIES.

    ``A group health plan may not recover (or seek to recover) from a 
participant or beneficiary more than the amounts expended by the plan 
on behalf of the participant or beneficiary in the case of amounts 
recovered by such a participant or beneficiary as a result of a 
settlement or judgment in a liability or other action.''.
                    (B) Conforming amendment.--Section 4980D(d)(1) of 
                such Code is amended by striking ``section 9811'' and 
                inserting ``sections 9811 and 9813''.
    (b) Individual Health Insurance.--Part B of title XXVII of the 
Public Health Service Act is amended by inserting after section 2752 
the following new section:

``SEC. 2753. STANDARD RELATING PATIENT PROTECTION IN CASE OF THIRD 
              PARTY RECOVERIES.

    ``(a) In General.--The provisions of section 2707(a) shall apply to 
health insurance coverage offered by a health insurance issuer in the 
individual market in the same manner as they apply to health insurance 
coverage offered by a health insurance issuer in connection with a 
group health plan in the small or large group market.
    ``(b) Notice.--A health insurance issuer under this part shall 
comply with the notice requirement under section 714(b) of the Employee 
Retirement Income Security Act of 1974 with respect to the requirements 
referred to in subsection (a) as if such section applied to such issuer 
and such issuer were a group health plan.''.
    (c) Effective Dates.--
            (1) Group health plans and group health insurance 
        coverage.--Subject to paragraph (3), the amendments made by 
        subsection (a) apply with respect to group health plans for 
        plan years beginning on or after January 1, 2001.
            (2) Individual health insurance coverage.--The amendment 
        made by subsection (b) applies with respect to health insurance 
        coverage offered, sold, issued, renewed, in effect, or operated 
        in the individual market on or after such date.
            (3) Collective bargaining exception.--In the case of a 
        group health plan maintained pursuant to 1 or more collective 
        bargaining agreements between employee representatives and 1 or 
        more employers ratified before the date of enactment of this 
        Act, the amendments made subsection (a) shall not apply to plan 
        years beginning before the later of--
                    (A) the date on which the last collective 
                bargaining agreements relating to the plan terminates 
                (determined without regard to any extension thereof 
                agreed to after the date of enactment of this Act), or
                    (B) January 1, 2002.
        For purposes of subparagraph (A), any plan amendment made 
        pursuant to a collective bargaining agreement relating to the 
        plan which amends the plan solely to conform to any requirement 
        added by subsection (a) shall not be treated as a termination 
        of such collective bargaining agreement.
    (d) Coordination of Administration.--The Secretary of Labor, the 
Secretary of the Treasury, and the Secretary of Health and Human 
Services shall ensure, through the execution of an interagency 
memorandum of understanding among such Secretaries, that--
            (1) regulations, rulings, and interpretations issued by 
        such Secretaries relating to the same matter over which two or 
        more such Secretaries have responsibility under the provisions 
        of this Act (and the amendments made thereby) are administered 
        so as to have the same effect at all times; and
            (2) coordination of policies relating to enforcing the same 
        requirements through such Secretaries in order to have a 
        coordinated enforcement strategy that avoids duplication of 
        enforcement efforts and assigns priorities in enforcement.

Summary: Amends the PHSA to apply the preceding prohibition to health insurance coverage offered by an issuer in the individual market in the same manner as it is applied to group health plan coverage in the group market. Provides for coordination between the Secretaries of Labor, Treasury, and Health and Human Services with respect to administration of this Act.