I

103D CONGRESS

2D SESSION H. R. 4788

To amend title 38, United States Code, to reform and simplify criteria

for eligibility for health care provided by the Department of Veterans

Affairs, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

JULY 19, 1994

Mr. STUMP (for himself, Mr. SMITH of New Jersey, Mr. BILIRAKIS, Mr.

RIDGE, Mr. SPENCE, Mr. HUTCHINSON, Mr. EVERETT, Mr. BUYER, Mr.

QUINN, Mr. BACHUS of Alabama, Mr. LINDER, Mr. KING, and Mr.

STEARNS) introduced the following bill; which was referred to the Committee on Veterans’ Affairs

A BILL

To amend title 38, United States Code, to reform and simplify criteria for eligibility for health care provided by

the Department of Veterans Affairs, and for other purposes.

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

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Veterans’ Health Care

5 Eligibility Reform Act of 1994’’.
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1 SEC. 2. VETERANS HEALTH CARE ELIGIBILITY REFORM.

2 Chapter 17 of title 38, United States Code, is amend3 ed as follows:

4 (1) Section 1701 is amended by adding at the

5 end the following new paragraphs:

6 ‘‘(10) The term ‘continuum of health care’ in7 cludes specialized treatment and rehabilitative serv8 ices of the Department, including comprehensive

9 prevention and health screening programs and serv10 ices to treat needs of disabled veterans with spinal

11 cord dysfunction, blindness, prosthetics, and mental

12 illness.

13 ‘‘(11) The term ‘noninstitutional long-term

14 care’ includes the following services:

15 ‘‘(A) Hospital-based home care.

16 ‘‘(B) Adult day health care.

17 ‘‘(C) Fee basis care.

18 ‘‘(D) Hospice care.

19 ‘‘(E) Homemaker services.

20 ‘‘(F) Home health aid.

21 ‘‘(G) Case management services.

22 ‘‘(H) Congregate meals.

23 ‘‘(I) Home delivered meals.

24 ‘‘(J) Senior center services.

25 ‘‘(K) Shopping and transportation services.

26 ‘‘(L) Phone check services.’’.
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1 (2) Section 1710(a)(1) is amended by striking

2 out ‘‘shall furnish’’ and all that follows through

3 ‘‘which the’’ and inserting in lieu thereof ‘‘shall fur4 nish a continuum of health care (including hospital

5 care, outpatient medical services provided on an out6 patient or ambulatory basis, and noninstitutional

7 long-term care) which the’’.

8 (3) Subchapter II is amended by inserting after

9 section 1710 the following new section:

10 ‘‘§ 1710A. Institutional long-term care for certain vet11 erans

12 ‘‘(a) The Secretary shall provide institutional nursing

13 home care to any veteran who is described in subpara14 graph (A) or (D) of section 1710(a)(1), or in subpara15 graph (C) of section 1712(a)(1), of this title or who is

16 in receipt of pension from the Secretary.

17 ‘‘(b) If a veteran who is provided nursing home care

18 by reason of subsection (a) is also eligible for payment

19 for the costs of nursing home care under a State plan title

20 XIX of the Social Security Act, the Secretary shall be enti21 tled to recover from that State plan the amount that the

22 State plan would pay for that care if provided by an au23 thorized provider. For purposes of this subsection, the vet24 eran shall be deemed to have paid any deductible or
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1 copayment otherwise required as a condition of payment

2 by the State plan.’’.

3 (4) Section 1710(d) is amended by inserting

4 ‘‘1710A or’’ after ‘‘section’’.

5 (5) Subchapter III is amended by inserting

6 after section 1729 the following new section:

7 ‘‘§ 1729A. Medicare coverage and reimbursement

8 ‘‘(a) For purposes of any program administered by

9 the Secretary of Health and Human Services under title

10 XVIII of the Social Security Act, a Department facility

11 shall be deemed to be a Medicare provider.

12 ‘‘(b)(1) A VA medical center (or group of medical

13 centers) shall be considered to be a Medicare HMO.

14 ‘‘(2) For purposes of this section, the term ‘Medicare

15 HMO’ means an eligible organization under section 1876

16 of the Social Security Act.

17 ‘‘(c) In the case of care for a non-service-connected

18 disability that is provided to a veteran who is eligible for

19 benefits under the Medicare program under title XVIII of

20 the Social Security Act, the Secretary of Health and

21 Human Services shall reimburse a Department health-care

22 facility providing services as a Medicare provider or Medi23 care HMO in the same amounts and under the same terms

24 and conditions as that Secretary reimburses other Medi25 care providers or Medicare HMOs, respectively. The Sec-
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1 retary of Health and Human Services shall include with

2 each such reimbursement a Medicare explanation of bene3 fits.

4 ‘‘(d) In the case of a veteran whose eligibility for hos5 pital care from the Department is by reason of section

6 1710(a)(2) of this title, the Secretary shall, when provid7 ing care to the veteran for which the Secretary receives

8 reimbursement under this section, require the veteran to

9 pay to the Department any applicable deductible or

10 copayment that is not covered by Medicare.’’.

11 SEC. 3. PLAN FOR ENTITLEMENT TO INSTITUTIONAL NURS12 ING HOME CARE FOR OTHER VETERANS.

13 (a) ESTABLISHMENT OF PLAN.—The Secretary of

14 Veterans Affairs shall develop a plan to implement (over

15 a specified period of years) the provision of institutional

16 long-term care for any veteran described in subsection (b).

17 The plan may provide for the provision of institutional

18 long-term care through facilities of the Department of

19 Veterans Affairs or through a long-term care insurance

20 contract, or a combination thereof. In specifying benefits,

21 or a proposed range of benefits, under the plan, the Sec22 retary shall consider a representative range of the dif23 ferent types of health benefits provisions (which include

24 cost-sharing) typically offered as long-term institutional
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1 care coverage in the small employer health coverage mar2 ket.

3 (b) COVERED VETERANS.—The plan shall propose to

4 cover any veteran not covered by section 1710A of title

5 38, United States Code, as added by section 2, who—

6 (1) has a service-connected disability rated at

7 less than 50 percent;

8 (2) has an annual income (as determined under

9 section 1503 of such title) that does not exceed three

10 times the maximum annual rate of pension that

11 would be applicable to the veteran if the veteran

12 were eligible for pension under section 1521(d) of

13 such title;

14 (3) has a catastrophic nonservice-connected dis15 ability (as defined by the Secretary); or

16 (4) requires institutional long-term care as a

17 follow up to inpatient care, as authorized under sec18 tion 1720 of this title.

19 (c) PREMIUMS AND COPAYMENTS.—The plan shall

20 include the establishment of a schedule of premiums and

21 copayments for care provided through Department of Vet22 erans Affairs institutional care programs in effect on the

23 day before the date of the enactment of this Act. The plan

24 shall specify a range of premiums and copayments that

25 would apply based upon different combinations of levels
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1 of payments by the Government, copayments, and pre2 miums, as specified in the plan.

3 (d) LONG-TERM CARE INSURANCE CONTRACT.—For

4 purposes of this section, the term ‘long-term care insur5 ance contract’ means any insurance contract issued if—

6 (1) the only insurance protection provided

7 under the contract is coverage of institutional long8 term care services (as specified in the contract) and

9 benefits incidental to such coverage,

10 (2) the maximum benefit under the policy for

11 expenses incurred for any day does not exceed $200,

12 (3) the contract does not cover expenses in13 curred for services or items to the extent that such

14 expenses are reimbursable under title XVIII of the

15 Social Security Act or would be so reimbursable but

16 for the application of a deductible or coinsurance

17 amount,

18 (4) the contract is guaranteed renewable,

19 (5) the contract does not have any cash surren20 der value, and

21 (6) all refunds of premiums, and all policy22 holder dividends or similar amounts, under the con23 tract are to be applied as a reduction in future pre24 miums or to increase future benefits.
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1 (e) REPORT TO CONGRESS.—Not later than Septem2 ber 30, 1996, the Secretary shall submit to Congress a

3 report on the plan. The report shall include—

4 (1) a cost analysis, including a range of pre5 miums and copayments and Government cost-shar6 ing;

7 (2) a discussion of the cost of establishing a

8 long-term care insurance program for veterans de9 scribed in subsection (b) using contract authority (if

10 such contract authority is provided by law); and

11 (3) a draft of legislation to make any necessary

12 changes in law to enable the Department to imple13 ment the plan.

14 SEC. 4. ENROLLMENT SYSTEM FOR OTHER PERSONS.

15 (a) IN GENERAL.—(1) Title 38, United States Code,

16 is amended by inserting after chapter 17 the following new

17 chapter:

18 ‘‘CHAPTER 18—VA GROUP HEALTH PLAN

‘‘Sec.

‘‘1801. Definitions.

‘‘1802. VA Group Health Plan.

‘‘1803. Enrollment.

‘‘1804. Limitation on preexisting conditions.

‘‘1805. Plan to be self supporting.

‘‘1806. Annual report.

19 ‘‘§ 1801. Definitions

20 ‘‘For purposes of this chapter:
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1 ‘‘(1) The term ‘eligible veteran’ means any vet2 eran other than a veteran eligible for health care

3 under section 1710(a)(1) of this title.

4 ‘‘(2) The term ‘VA enrollee’ means an individ5 ual enrolled in the VA Group Health Plan.

6 ‘‘§ 1802. VA Group Health Plan

7 ‘‘(a) The Secretary shall administer a program of

8 health insurance under this chapter to be known as the

9 VA Group Health Plan. The Secretary may provide such

10 insurance directly or may contract with an insurance pro11 vider in the private sector for the provision of such insur12 ance. The plan may be established as a single, nation-wide

13 plan or as a composite of regional health insurance plans.

14 ‘‘(b) The Secretary shall establish and carry out the

15 VA Group Health Plan as a managed-care plan and so

16 that it meets the following requirements:

17 ‘‘(1) The plan shall be designed to be self-sus18 taining through required premiums, copayments,

19 deductibles, and other charges, and without appro20 priated funds.

21 ‘‘(2) The plan shall provide such benefits as the

22 Secretary determines.

23 ‘‘(c) The Secretary may award contracts under this

24 section for the operation of the VA Group plan.
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1 ‘‘(d) The Secretary may provide treatment in Depart2 ment facilities for any enrollee, if cost effective.

3 ‘‘§ 1803. Enrollment

4 ‘‘(a) The following individuals are eligible to enroll

5 in the VA Group Health Plan:

6 ‘‘(1) Any eligible veteran.

7 ‘‘(2) The spouse or child of any veteran.

8 ‘‘(b)(1) The Secretary of Veterans Affairs shall estab9 lish an enrollment (and disenrollment) process for the VA

10 Group Health Plan in accordance with this subsection.

11 Such process shall be established in consultation with vet12 erans and other individuals to be served by the plan.

13 ‘‘(2) For each eligible veteran, when the veteran first

14 becomes eligible to enroll in the VA Group Health Plan,

15 there shall be an initial enrollment period (of not less than

16 30 days) during which the veteran may enroll in the plan.

17 ‘‘(3) The Secretary shall establish an annual period,

18 of not less than 30 days, during which eligible veterans

19 may enroll in the VA Group Health Plan.

20 ‘‘(4) If a veteran enrolls in the VA Group Health

21 Plan, the veteran may at the same time enroll, as a family

22 enrollment, the veteran’s spouse and children in the plan.

23 ‘‘(5) In the case of individuals who through marriage,

24 divorce, birth or adoption of a child, or similar cir25 cumstances, experience a change in family composition,
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1 the Secretary shall provide for a special enrollment period

2 in which the individual is permitted to change the individ3 ual or family basis of coverage. The circumstances under

4 which such special enrollment periods are required and the

5 duration of such periods shall be specified by the Sec6 retary.

7 ‘‘(6) The Secretary shall provide for a special transi8 tional enrollment period during which eligible individuals

9 may first enroll.

10 ‘‘(c) Enrollment of the spouse (including a child of

11 the spouse) and any dependent child of an eligible veteran

12 shall be considered to be timely if a request for enrollment

13 is made either—

14 ‘‘(1) within 30 days of the date of the marriage

15 or of the date of the birth or adoption of a child,

16 if family coverage is available as of such date, or

17 ‘‘(2) within 30 days of the date family coverage

18 is first made available.

19 ‘‘(d) Family coverage shall become effective not later

20 than the first day of the first month beginning after the

21 date of the marriage or the date of birth or adoption of

22 the child (as the case may be).

23 ‘‘(e) The Secretary may terminate coverage for

24 nonpayment of premiums.
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1 ‘‘(f) Coverage of a spouse under a policy under this

2 chapter may not be canceled by reason of the death of

3 the veteran unless the surviving spouse remarries.

4 ‘‘§ 1804. Limitation on preexisting conditions

5 ‘‘(a) The VA Group Health Plan may not impose

6 (and an insurer under that plan may not require the Sec7 retary impose through a waiting period for coverage under

8 the plan or similar requirement) a limitation or exclusion

9 of benefits relating to treatment of a condition based on

10 the fact that the condition preexisted the effective date

11 of the plan with respect to an individual if—

12 ‘‘(1) the condition relates to a condition that

13 was not diagnosed or treated within three months

14 before the date of coverage under the plan;

15 ‘‘(2) the limitation or exclusion extends over

16 more than six months after the date of coverage

17 under the plan;

18 ‘‘(3) the limitation or exclusion applies to an in19 dividual who, as of the date of birth, was covered

20 under the plan; or

21 ‘‘(4) the limitation or exclusion relates to preg22 nancy.

23 In the case of an individual who is eligible for coverage

24 under a plan but for a waiting period imposed by the em25 ployer, in applying paragraphs (1) and (2), the individual
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1 shall be treated as having been covered under the plan

2 as of the earliest date of the beginning of the waiting pe3 riod.

4 ‘‘(b)(1) The Secretary, for purposes of the VA Group

5 Health Plan, shall waive any period applicable to a pre6 existing condition for similar benefits with respect to an

7 individual to the extent that the individual, before the date

8 of such individual’s enrollment in such plan, was covered

9 for the condition under any other health plan that was

10 in effect before such date.

11 ‘‘(2) Paragraph (1) shall no longer apply if there is

12 a continuous period of more than 60 days (or, in the case

13 of an individual who loses coverage under a group health

14 plan due to termination of employment, six months) on

15 which the individual was not covered under a group health

16 plan.

17 ‘‘(3) In applying paragraph (2), any waiting period

18 imposed by an employer before an employee is eligible to

19 be covered under a plan shall be treated as a period in

20 which the employee was covered under a group health

21 plan.

22 ‘‘§ 1805. Plan to be self supporting

23 ‘‘The Secretary shall administer the VA Group

24 Health Plan so as to ensure that no appropriated funds

25 are required for the operation of the plan (other than as
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1 necessary for startup and transition costs). The Secretary

2 shall establish such premiums, copayments, and other

3 charges for the plan as necessary.

4 ‘‘§ 1806. Annual report

5 ‘‘(a) The Secretary shall submit to Congress an an6 nual report on the VA Group Health Plan. The report

7 shall provide information on prices, health outcomes, and

8 enrollee satisfaction under the plan and any other infor9 mation the Secretary considers appropriate concerning the

10 quality of the plan, including a breakdown of the portion

11 of premiums under the plan that are attributable to the

12 overhead operations of the plan.

13 ‘‘(b) The report shall be submitted each year before

14 the annual general enrollment period. The Secretary shall

15 make such report available to other interested persons.’’.

16 (2) The table of chapters at the beginning of part

17 II of title 38, United States Code, is amended by inserting

18 after the item relating to chapter 17 the following new

19 item:

‘‘18. VA Group Health Plan ..................................................................... 1801.’’.

20 (b) INITIAL REPORT.—The initial report of the Sec21 retary of Veterans Affairs under section 1806 of title 38,

22 United States Code, as added by subsection (a), shall be

23 submitted no later than September 30, 1995. The report

24 shall include a cost analysis for the plan and a range of
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1 premiums and copayments that may be implemented

2 under the plan.

3 SEC. 5. MANAGED CARE SYSTEM OF HEALTH DELIVERY.

4 (a) Chapter 73 of title 38, United States Code, is

5 amended by inserting after section 7306 the following new

6 sections:

7 ‘‘§ 7307. Managed care

8 ‘‘(a) The Secretary shall administer the health pro9 grams of the Veterans Health Administration through use

10 of the model of medical practice known as ‘managed care’.

11 ‘‘(b) In implementing a managed care system, the

12 Under Secretary shall, to the extent possible—

13 ‘‘(1) shift the focus of care provided by the Vet14 erans Health Administration to primary care;

15 ‘‘(2) establish enhanced quality assurance

16 mechanisms; and

17 ‘‘(3) establish utilization review procedures to

18 prevent inefficient practices.

19 ‘‘§ 7308. Veterans Service Areas

20 ‘‘The Secretary shall organize the health care delivery

21 services and resources of the Veterans Health Administra22 tion into geographic regions to be known as Veterans Serv23 ice Areas.’’.
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1 (b) The table of sections at the beginning of such

2 chapter is amended by inserting after the item relating

3 to section 7306 the following new items:

‘‘7307. Managed care.

‘‘7308. Veterans Service Areas.’’.

4 (c) If, as of the date of the enactment of this Act,

5 the position of Under Secretary for Health of the Depart6 ment of Veterans Affairs is vacant, the provisions of sec7 tion 7308 of title 38, United States Code, as added by

8 subsection (a), shall not take effect until an individual is

9 appointed to that position.

10 SEC. 6. AUTHORIZATION OF APPROPRIATIONS.

11 There are authorized to be appropriated to the Sec12 retary of Veterans Affairs for each of fiscal years 1995

13 through 1999 (in constant fiscal year 1995 dollars)—

14 (1) $200,000,000 to acquire medical equipment

15 to relieve the existing medical equipment backlog in

16 Department of Veterans Affairs medical facilities;

17 and

18 (2) $500,000,000 for improvements of infra19 structure, patient care amenities, primary care serv20 ices, and personnel and for medical facility construc21 tion projects (subject to section 8104 of title 38,

22 United States Code).

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