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[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1747 Received in Senate (RDS)]

  1st Session
                                H. R. 1747

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                           December 13, 1995

                                Received

_______________________________________________________________________

                                 AN ACT

 
   To amend the Public Health Service Act to permanently extend and 
    clarify malpractice coverage for health centers, and for other 
                               purposes.

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

SECTION 1. SHORT TITLE; REFERENCES.

    (a) Short Title.--This Act may be cited as the ``Federally 
Supported Health Centers Assistance Act of 1995''.
    (b) References.--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)(3) (42 U.S.C. 233(g)(3)) is amended 
by striking the last sentence.
    (b) Conforming Amendments.--Section 224(k) (42 U.S.C. 233(k)) is 
amended--
            (1) in paragraph (1)(A)--
                    (A) by striking ``For each of the fiscal years 
                1993, 1994, and 1995'' and inserting ``For each fiscal 
                year''; and
                    (B) by striking ``(except'' and all that follows 
                through ``thereafter)''; and
            (2) in paragraph (2), by striking ``for each of the fiscal 
        years 1993, 1994, and 1995'' and inserting ``for each fiscal 
        year''.

SEC. 3. CLARIFICATION OF COVERAGE.

    Section 224 (42 U.S.C. 233) is amended--
            (1) in subsection (g)(1), by striking ``an entity described 
        in paragraph (4)'' in the first sentence and all that follows 
        through ``contractor'' in the second sentence and inserting the 
        following: ``an entity described in paragraph (4), and any 
        officer, governing board member, or employee of such an entity, 
        and any contractor of such an entity who is a physician or 
        other licensed or certified health care practitioner (subject 
        to paragraph (5)), shall be deemed to be an employee of the 
        Public Health Service for a calendar year that begins during a 
        fiscal year for which a transfer was made under subsection 
        (k)(3) (subject to paragraph (3)). The remedy against the 
        United States for an entity described in paragraph (4) and any 
        officer, governing board member, employee, or contractor''; and
            (2) in subsection (k)(3), by inserting ``governing board 
        member,'' after ``officer,''.

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

    Section 224(g)(1) (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 for purposes of this section 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 after ``For purposes 
        of this section'' the following: ``and subject to the approval 
        by the Secretary of an application under subparagraph (D)''; 
        and
            (2) by adding at the end thereof the following:
    ``(D) The Secretary may not under subparagraph (A) deem an entity 
or an officer, governing board member, employee, or contractor of the 
entity to be an employee of the Public Health Service for purposes of 
this section, 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.
    ``(G) In the case of an entity described in paragraph (4) that has 
not submitted an application under subparagraph (D):
            ``(i) The Secretary may not consider the entity in making 
        estimates under subsection (k)(1).
            ``(ii) This section does not affect any authority of the 
        entity to purchase medical malpractice liability insurance 
        coverage with Federal funds provided to the entity under 
        section 329, 330, 340, or 340A.
    ``(H) In the case of an entity described in paragraph (4) for which 
an application under subparagraph (D) is in effect, the entity may, 
through notifying the Secretary in writing, elect to terminate the 
applicability of this subsection to the entity. With respect to such 
election by the entity:
            ``(i) The election is effective upon the expiration of the 
        30-day period beginning on the date on which the entity submits 
        such notification.
            ``(ii) Upon taking effect, the election terminates the 
        applicability of this subsection to the entity and each 
        officer, governing board member, employee, and contractor of 
        the entity.
            ``(iii) Upon the effective date for the election, clauses 
        (i) and (ii) of subparagraph (G) apply to the entity to the 
        same extent and in the same manner as such clauses apply to an 
        entity that has not submitted an application under subparagraph 
        (D).
            ``(iv) If after making the election the entity submits an 
        application under subparagraph (D), the election does not 
        preclude the Secretary from approving the application (and 
        thereby restoring the applicability of this subsection to the 
        entity and each officer, governing board member, employee, and 
        contractor of the entity, subject to the provisions of this 
        subsection and the subsequent provisions of this section.''.
    (b) Approval Process.--Section 224(h) (42 U.S.C. 233(h)) is 
amended--
            (1) in the matter preceding paragraph (1), by striking 
        ``Notwithstanding'' and all that follows through ``entity--'' 
        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''.
    (c) Delayed Applicability for Current Participants.--If, on the day 
before the date of the enactment of this Act, an entity was deemed to 
be an employee of the Public Health Service for purposes of section 
224(g) of the Public Health Service Act, the condition under paragraph 
(1)(D) of such section (as added by subsection (a) of this section) 
that an application be approved with respect to the entity does not 
apply until the expiration of the 180-day period beginning on such 
date.

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 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 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. 223) (as amended by section 6) is amended by 
adding at the end thereof the following subsection:
    ``(m)(1) An entity or officer, governing board member, employee, or 
contractor of an entity described in subsection (g)(1) 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 titles 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 or 
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.

    Section 224(g)(5)(B) (42 U.S.C. 223(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. AMOUNT OF RESERVE FUND.

    Section 224(k)(2) (42 U.S.C. 223(k)(2)) is amended by striking 
``$30,000,000'' and inserting ``$10,000,000''.

SEC. 11. REPORT ON RISK EXPOSURE OF COVERED ENTITIES.

    Section 224 (as amended by section 7) is amended by adding at the 
end thereof the following subsection:
    ``(n)(1) Not later than one year after the date of the enactment of 
the Federally Supported Health Centers Assistance Act of 1995, the 
Comptroller General of the United States shall submit to the Congress a 
report on the following:
            ``(A) The medical malpractice liability claims experience 
        of entities that have been deemed to be employees for purposes 
        of this section.
            ``(B) The risk exposure of such entities.
            ``(C) The value of private sector risk-management services, 
        and the value of risk-management services and procedures 
        required as a condition of receiving a grant under section 329, 
        330, 340, or 340A.
            ``(D) A comparison of the costs and the benefits to 
        taxpayers of maintaining medical malpractice liability coverage 
        for such entities pursuant to this section, taking into 
        account--
                    ``(i) a comparison of the costs of premiums paid by 
                such entities for private medical malpractice liability 
                insurance with the cost of coverage pursuant to this 
                section; and
                    ``(ii) an analysis of whether the cost of premiums 
                for private medical malpractice liability insurance 
                coverage is consistent with the liability claims 
                experience of such entities.
    ``(2) The report under paragraph (1) shall include the following:
            ``(A) A comparison of--
                    ``(i) an estimate of the aggregate amounts that 
                such entities (together with the officers, governing 
                board members, employees, and contractors of such 
                entities who have been deemed to be employees for 
                purposes of this section) would have directly or 
                indirectly paid in premiums to obtain medical 
                malpractice liability insurance coverage if this 
                section were not in effect; with
                    ``(ii) the aggregate amounts by which the grants 
                received by such entities under this Act were reduced 
                pursuant to subsection (k)(2).
            ``(B) A comparison of--
                    ``(i) an estimate of the amount of privately 
                offered such insurance that such entities (together 
                with the officers, governing board members, employees, 
                and contractors of such entities who have been deemed 
                to be employees for purposes of this section) purchased 
                during the three-year period beginning on January 1, 
                1993; with
                    ``(ii) an estimate of the amount of such insurance 
                that such entities (together with the officers, 
                governing board members, employees, and contractors of 
                such entities who have been deemed to be employees for 
                purposes of this section) will purchase after the date 
                of the enactment of the Federally Supported Health 
                Centers Assistance Act of 1995.
            ``(C) An estimate of the medical malpractice liability loss 
        history of such entities for the 10-year period preceding 
        October 1, 1996, including but not limited to the following:
                    ``(i) Claims that have been paid and that are 
                estimated to be paid, and legal expenses to handle such 
                claims that have been paid and that are estimated to be 
                paid, by the Federal Government pursuant to deeming 
                entities as employees for purposes of this section.
                    ``(ii) Claims that have been paid and that are 
                estimated to be paid, and legal expenses to handle such 
                claims that have been paid and that are estimated to be 
                paid, by private medical malpractice liability 
                insurance.
          ``(D) An analysis of whether the cost of premiums for private 
        medical malpractice liability insurance coverage is consistent 
        with the liability claims experience of entities that have been 
        deemed as employees for purposes of this section.
    ``(3) In preparing the report under paragraph (1), the Comptroller 
General of the United States shall consult with public and private 
entities with expertise on the matters with which the report is 
concerned.''.

            Passed the House of Representatives December 12, 1995.

            Attest:

                                                ROBIN H. CARLE,

                                                                 Clerk.
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