I

104TH CONGRESS

2D SESSION H. R. 3092

To amend the Internal Revenue Code of 1986 to encourage State unemployment insurance laws to establish a system under which workers may

purchase insurance to cover the costs of health insurance during periods

of unemployment.

IN THE HOUSE OF REPRESENTATIVES

MARCH 14, 1996

Mr. FRANKS of Connecticut introduced the following bill; which was referred

to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to encourage

State unemployment insurance laws to establish a system

under which workers may purchase insurance to cover

the costs of health insurance during periods of

unemployment.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 That (a) subsection (a) of section 3304 of the Internal

4 Revenue Code of 1986 (relating to approval of State un5 employment compensation laws) is amended by striking

6 ‘‘and’’ at the end of paragraph (17), by redesignating
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1 paragraph (18) as paragraph (19), and by inserting after

2 paragraph (17) the following new paragraph:

3 ‘‘(18) optional health insurance continuation

4 benefits shall be available as required by subsection

5 (g); and’’

6 (b) Section 3304 of such Code is amended by adding

7 at the end thereof the following new subsection:

8 ‘‘(g) OPTIONAL HEALTH INSURANCE CONTINUATION

9 BENEFITS.—

10 ‘‘(1) IN GENERAL.—For purposes of subsection

11 (a)(18), a State law meets the requirements of this

12 subsection if—

13 ‘‘(A) the State law establishes a program

14 under which individuals performing services

15 covered under such State law may elect to pur16 chase health insurance continuation benefits by

17 having premiums deducted by their employer

18 from their wages,

19 ‘‘(B) such program offers several options

20 as to the period for which such benefits are

21 available and as to the level of such benefits,

22 ‘‘(C) such program specifies the periodic

23 premium to be deducted for each of such op24 tions and the maximum total premium payable

25 for any such option, and
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1 ‘‘(D) any premiums collected pursuant to

2 such program are to be deposited in a special

3 fund established under such State law which is

4 to be used solely for purposes of providing

5 health insurance continuation benefits (exclu6 sive of costs of administration).

7 ‘‘(2) HEALTH INSURANCE CONTINUATION BEN8 EFITS.—For purposes of this subsection, the term

9 ‘health insurance continuation benefits’ means pay10 ments to or on behalf of an individual who is receiv11 ing compensation under the State law to assist in

12 covering the cost of health insurance for such indi13 vidual and his spouse and dependents.

14 ‘‘(3) ADMINISTRATIVE FUNDS MADE AVAIL15 ABLE.—For purposes of title III of the Social Secu16 rity Act, the costs of administering the program re17 ferred to in paragraph (1) shall be treated as costs

18 of administering the State unemployment compensa19 tion law.’’.

20 (c)(1) Except as provided by paragraph (2), the

21 amendments made by this section shall take effect on No22 vember 1, 1996.

23 (2) In the case of any State the legislature of which

24 has not been in session for at least 30 calendar days

25 (whether or not successive) between the date of the enact-
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1 ment of this Act and November 1, 1996, the amendments

2 made by this section shall take effect 30 calendar days

3 after the first day on which such legislature is in session

4 on or after November 1, 1996.

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