In the Senate of the United States,

October 19, 2005.

Resolved, That the bill from the House of Representatives (H.R. 3204) entitled ‘‘An Act to amend title XXVII of

the Public Health Service Act to extend Federal funding for

the establishment and operation of State high risk health insurance pools.’’, do pass with the following

AMENDMENT:

Strike out all after the enacting clause and insert:

1 SECTION 1. SHORT TITLE.

2 This Act may be cited as the ‘‘State High Risk Pool

3 Funding Extension Act of 2005’’.
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1 SEC. 2. EXTENSION OF FUNDING FOR OPERATION OF

2 STATE HIGH RISK HEALTH INSURANCE

3 POOLS.

4 Section 2745 of the Public Health Service Act (42

5 U.S.C. 300gg–45) is amended to read as follows:

6 ‘‘SEC. 2745. RELIEF FOR HIGH RISK POOLS.

7 ‘‘(a) SEED GRANTS TO STATES.—The Secretary shall

8 provide from the funds appropriated under subsection

9 (d)(1)(A) a grant of up to $1,000,000 to each State that

10 has not created a qualified high risk pool as of the date

11 of enactment of the State High Risk Pool Funding Exten12 sion Act of 2005 for the State’s costs of creation and initial

13 operation of such a pool.

14 ‘‘(b) GRANTS FOR OPERATIONAL LOSSES.—

15 ‘‘(1) IN GENERAL.—In the case of a State that

16 has established a qualified high risk pool that—

17 ‘‘(A) restricts premiums charged under the

18 pool to no more than 200 percent of the premium

19 for applicable standard risk rates;

20 ‘‘(B) offers a choice of two or more coverage

21 options through the pool; and

22 ‘‘(C) has in effect a mechanism reasonably

23 designed to ensure continued funding of losses in24 curred by the State in connection with operation

25 of the pool after the end of the last fiscal year
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1 for which a grant is provided under this para2 graph;

3 the Secretary shall provide, from the funds appro4 priated under paragraphs (1)(B)(i) and (2)(A) of

5 subsection (d) and allotted to the State under para6 graph (2), a grant for the losses incurred by the State

7 in connection with the operation of the pool.

8 ‘‘(2) ALLOTMENT.—Subject to paragraph (4), the

9 amounts appropriated under paragraphs (1)(B)(i)

10 and (2)(A) of subsection (d) for a fiscal year shall be

11 allotted and made available to the States (or the enti12 ties that operate the high risk pool under applicable

13 State law) that qualify for a grant under paragraph

14 (1) as follows:

15 ‘‘(A) An amount equal to 40 percent of such

16 appropriated amount for the fiscal year shall be

17 allotted in equal amounts to each qualifying

18 State that is one of the 50 States or the District

19 of Columbia and that applies for a grant under

20 this subsection.

21 ‘‘(B) An amount equal to 30 percent of such

22 appropriated amount for the fiscal year shall be

23 allotted among qualifying States that apply for

24 such a grant so that the amount allotted to such

25 a State bears the same ratio to such appro-
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1 priated amount as the number of uninsured in2 dividuals in the State bears to the total number

3 of uninsured individuals (as determined by the

4 Secretary) in all qualifying States that so apply.

5 ‘‘(C) An amount equal to 30 percent of such

6 appropriated amount for the fiscal year shall be

7 allotted among qualifying States that apply for

8 such a grant so that the amount allotted to a

9 State bears the same ratio to such appropriated

10 amount as the number of individuals enrolled in

11 health care coverage through the qualified high

12 risk pool of the State bears to the total number

13 of individuals so enrolled through qualified high

14 risk pools (as determined by the Secretary) in all

15 qualifying States that so apply.

16 ‘‘(3) SPECIAL RULE FOR POOLS CHARGING HIGH17 ER PREMIUMS.—In the case of a qualified high risk

18 pool of a State which charges premiums that exceed

19 150 percent of the premium for applicable standard

20 risks, the State shall use at least 50 percent of the

21 amount of the grant provided to the State to carry

22 out this subsection to reduce premiums for enrollees.

23 ‘‘(4) LIMITATION FOR TERRITORIES.—In no case

24 shall the aggregate amount allotted and made avail25 able under paragraph (2) for a fiscal year to States
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1 that are not the 50 States or the District of Columbia

2 exceed $1,000,000.

3 ‘‘(c) BONUS GRANTS FOR SUPPLEMENTAL CONSUMER

4 BENEFITS.—

5 ‘‘(1) IN GENERAL.—In the case of a State that

6 is one of the 50 States or the District of Columbia,

7 that has established a qualified high risk pool, and

8 that is receiving a grant under subsection (b)(1), the

9 Secretary shall provide, from the funds appropriated

10 under paragraphs (1)(B)(ii) and (2)(B) of subsection

11 (d) and allotted to the State under paragraph (3), a

12 grant to be used to provide supplemental consumer

13 benefits to enrollees or potential enrollees (or defined

14 subsets of such enrollees or potential enrollees) in

15 qualified high risk pools.

16 ‘‘(2) BENEFITS.—A State shall use amounts re17 ceived under a grant under this subsection to provide

18 one or more of the following benefits:

19 ‘‘(A) Low-income premium subsidies.

20 ‘‘(B) A reduction in premium trends, actual

21 premiums, or other cost-sharing requirements.

22 ‘‘(C) An expansion or broadening of the

23 pool of individuals eligible for coverage, such as

24 through eliminating waiting lists, increasing en-
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1 rollment caps, or providing flexibility in enroll2 ment rules.

3 ‘‘(D) Less stringent rules, or additional

4 waiver authority, with respect to coverage of pre5 existing conditions.

6 ‘‘(E) Increased benefits.

7 ‘‘(F) The establishment of disease manage8 ment programs.

9 ‘‘(3) ALLOTMENT; LIMITATION.—The Secretary

10 shall allot funds appropriated under paragraphs

11 (1)(B)(ii) and (2)(B) of subsection (d) among States

12 qualifying for a grant under paragraph (1) in a

13 manner specified by the Secretary, but in no case

14 shall the amount so allotted to a State for a fiscal

15 year exceed 10 percent of the funds so appropriated

16 for the fiscal year.

17 ‘‘(4) RULE OF CONSTRUCTION.—Nothing in this

18 subsection shall be construed to prohibit a State that,

19 on the date of the enactment of the State High Risk

20 Pool Funding Extension Act of 2005, is in the process

21 of implementing a program to provide benefits of the

22 type described in paragraph (2), from being eligible

23 for a grant under this subsection.

24 ‘‘(d) FUNDING.—
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1 ‘‘(1) APPROPRIATION FOR FISCAL YEAR 2006.—

2 There are authorized to be appropriated and there are

3 appropriated for fiscal year 2006—

4 ‘‘(A) $15,000,000 to carry out subsection

5 (a); and

6 ‘‘(B) $75,000,000, of which, subject to para7 graph (4)—

8 ‘‘(i) two-thirds of the amount appro9 priated shall be made available for allot10 ments under subsection (b)(2); and

11 ‘‘(ii) one-third of the amount appro12 priated shall be made available for allot13 ments under subsection (c)(3).

14 ‘‘(2) AUTHORIZATION OF APPROPRIATIONS FOR

15 FISCAL YEARS 2007 THROUGH 2010.—There are au16 thorized to be appropriated $75,000,000 for each of

17 fiscal years 2007 through 2010, of which, subject to

18 paragraph (4)—

19 ‘‘(A) two-thirds of the amount appropriated

20 for a fiscal year shall be made available for al21 lotments under subsection (b)(2); and

22 ‘‘(B) one-third of the amount appropriated

23 for a fiscal year shall be made available for al24 lotments under subsection (c)(3).
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1 ‘‘(3) AVAILABILITY.—Funds appropriated for

2 purposes of carrying out this section for a fiscal year

3 shall remain available for obligation through the end

4 of the following fiscal year.

5 ‘‘(4) REALLOTMENT.—If, on June 30 of each fis6 cal year for which funds are appropriated under

7 paragraph (1)(B) or (2), the Secretary determines

8 that all the amounts so appropriated are not allotted

9 or otherwise made available to States, such remaining

10 amounts shall be allotted and made available under

11 subsection (b) among States receiving grants under

12 subsection (b) for the fiscal year based upon the allot13 ment formula specified in such subsection.

14 ‘‘(5) NO ENTITLEMENT.—Nothing in this section

15 shall be construed as providing a State with an enti16 tlement to a grant under this section.

17 ‘‘(e) APPLICATIONS.—To be eligible for a grant under

18 this section, a State shall submit to the Secretary an appli19 cation at such time, in such manner, and containing such

20 information as the Secretary may require.

21 ‘‘(f) ANNUAL REPORT.—The Secretary shall submit to

22 Congress an annual report on grants provided under this

23 section. Each such report shall include information on the

24 distribution of such grants among States and the use of

25 grant funds by States.
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1 ‘‘(g) DEFINITIONS.—In this section:

2 ‘‘(1) QUALIFIED HIGH RISK POOL.—

3 ‘‘(A) IN GENERAL.—The term ‘qualified

4 high risk pool’ has the meaning given such term

5 in section 2744(c)(2), except that a State may

6 elect to meet the requirement of subparagraph

7 (A) of such section (insofar as it requires the

8 provision of coverage to all eligible individuals)

9 through providing for the enrollment of eligible

10 individuals through an acceptable alternative

11 mechanism (as defined for purposes of section

12 2744) that includes a high risk pool as a compo13 nent.

14 ‘‘(2) STANDARD RISK RATE.—The term ‘standard

15 risk rate’ means a rate—

16 ‘‘(A) determined under the State high risk

17 pool by considering the premium rates charged

18 by other health insurers offering health insurance

19 coverage to individuals in the insurance market

20 served;

21 ‘‘(B) that is established using reasonable ac22 tuarial techniques; and

23 ‘‘(C) that reflects anticipated claims experi24 ence and expenses for the coverage involved.
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1 ‘‘(3) STATE.—The term ‘State’ means any of the

2 50 States and the District of Columbia and includes

3 Puerto Rico, the Virgin Islands, Guam, American

4 Samoa, and the Northern Mariana Islands.’’.

Attest:

Secretary.
109TH CONGRESS

1ST SESSION H. R. 3204

AMENDMENT