I 

113TH CONGRESS 

1ST SESSION H. R. 3489 

To amend section 1341 of the Patient Protection and Affordable Care Act 

to repeal the funding mechanism for the transitional reinsurance program 

in the individual market, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

NOVEMBER 14, 2013 

Mr. TIBERI (for himself, Mr. LIPINSKI, Mr. BOUSTANY, Mr. SCHOCK, Mr. 

BRADY of Texas, Ms. JENKINS, Mr. SAM JOHNSON of Texas, Mr. 

REICHERT, Mr. GRIFFIN of Arkansas, Mr. MCINTYRE, Mr. TURNER, 

Mrs. BLACK, and Mr. MURPHY of Florida) introduced the following bill; 

which was referred to the Committee on Energy and Commerce 

A BILL 

To amend section 1341 of the Patient Protection and Affordable Care Act to repeal the funding mechanism for the 

transitional reinsurance program in the individual market, 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. FINDINGS; PURPOSE. 

4 (a) FINDINGS.—Congress makes the following find5 ings: 

6 (1) According to the most recent United States 

7 Census, employer-based health insurance is the largVerDate Mar 15 2010 22:02 Nov 19, 2013 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H3489.IH H3489

emcdonald on DSK67QTVN1PROD with BILLS
2 

•HR 3489 IH

1 est source of health insurance coverage in the 

2 United States. Of those employed, 70 percent receive 

3 employment-based health insurance. Of unemployed 

4 Americans, 30 percent receive employer-sponsored 

5 health insurance. 

6 (2) Despite the large percentages of coverage, 

7 as health care costs climb, the percentage of Ameri8 cans who receive health insurance through employers 

9 has fallen significantly over the last decade—from 

10 70 percent nationwide in 2000 to 60 percent in 

11 2011, according to a report by the Robert Wood 

12 Johnson Foundation. 

13 (3) According to recent surveys done by the Na14 tional Business Group on Health and the Kaiser 

15 Family Foundation, most companies continue to 

16 provide health insurance for employees and wish to 

17 continue doing so into the future. 

18 (4) Employers who offer insurance will not con19 tribute additional risk to the health insurance ex20 changes established in the Patient Protection and 

21 Affordable Care Act (in this Act referred to as 

22 ‘‘PPACA’’). 

23 (5) The transitional reinsurance program, es24 tablished in section 1341 of PPACA, is intended to 

25 stabilize risk in the individual health insurance marVerDate Mar 15 2010 22:02 Nov 19, 2013 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3489.IH H3489

emcdonald on DSK67QTVN1PROD with BILLS
3 

•HR 3489 IH

1 ket during the first three years of the health insur2 ance exchanges, as established by that Act. 

3 (6) PPACA also requires that the Treasury col4 lect a fee for each employer-sponsored covered life in 

5 order to pay for the transitional reinsurance pro6 gram. 

7 (7) This fee is a disincentive for employers to 

8 continue offering coverage to all employees, and does 

9 not give employers any benefits of the transitional 

10 reinsurance program. 

11 (b) PURPOSE.—It is the purpose of this Act to re12 move the current funding mechanism for the transitional 

13 reinsurance program. Employer-sponsored insurance 

14 should be supported so that Americans can sustain quality 

15 health coverage. 

16 SEC. 2. CHANGES IN FUNDING FOR TRANSITIONAL REIN17 SURANCE PROGRAM IN THE INDIVIDUAL 

18 MARKET. 

19 (a) IN GENERAL.—Section 1341(b) of the Patient 

20 Protection and Affordable Care Act (Public Law 111–148; 

21 42 U.S.C. 18061(b)) is amended— 

22 (1) in paragraph (1), by striking ‘‘under 

23 which—’’ and all that follows and inserting the fol24 lowing: ‘‘under which the applicable reinsurance en25 tity uses amounts appropriated under paragraph 


emcdonald on DSK67QTVN1PROD with BILLS
4 

•HR 3489 IH

1 (2)(B) to make reinsurance payments to health in2 surance issuers that cover high risk individuals in 

3 the individual market (excluding grandfathered 

4 health plans) for any plan year beginning in the 3- 

5 year period beginning January 1, 2014.’’; 

6 (2) in paragraph (2)(B), by striking ‘‘PAYMENT

7 AMOUNT’’ and all that follows through the end of the 

8 first sentence and inserting the following: ‘‘AUTHOR9 IZATION OF APPROPRIATIONS; PAYMENT FOR10 MULA.—There are hereby authorized to be appro11 priated, based on the best estimates of the NAIC, 

12 $10,000,000,000 for plan years beginning in 2014, 

13 $6,000,000,000 for plan years beginning in 2015, 

14 and $4,000,000,000 for plan years beginning in 

15 2016 to make reinsurance payments to health insur16 ance issuers described in paragraph (1) that insure 

17 high-risk individuals consistent with paragraph 

18 (3).’’; and 

19 (3) by striking paragraphs (3) and (4) and in20 serting the following: 

21 ‘‘(3) EXTENSION OF FUND AVAILABILITY AND

22 TREATMENT OF UNEXPENDED AMOUNTS.— 

23 ‘‘(A) EXTENSION OF FUND AVAIL24 ABILITY.—The amounts appropriated for a plan 

25 year under paragraph (2)(B) shall be allocated 


emcdonald on DSK67QTVN1PROD with BILLS
5 

•HR 3489 IH

1 among States and used in any of the plan years 

2 referred to in such paragraph based on the re3 insurance needs of the States and periods in4 volved, as determined by the Secretary. 

5 ‘‘(B) TREATMENT OF UNEXPENDED

6 AMOUNTS.—Amounts appropriated under para7 graph (2)(B) that remain unexpended as of De8 cember 31, 2016, and that are otherwise allo9 cated to a State may be used to make payments 

10 under any reinsurance program of the State in 

11 the individual market in effect in the 2-year pe12 riod beginning on January 1, 2017.’’. 

13 (b) EFFECTIVE DATE.—The amendments made by 

14 subsection (a) shall take effect as if included in the enact15 ment of section 1341 of Public Law 111–148. 

Æ 


emcdonald on DSK67QTVN1PROD with BILLS