II

106TH CONGRESS

1ST SESSION S. 496

To provide for the establishment of an assistance program for health

insurance consumers.

IN THE SENATE OF THE UNITED STATES

MARCH 2, 1999

Mr. REED (for himself and Mr. WYDEN) introduced the following bill; which

was read twice and referred to the Committee on Health, Education,

Labor, and Pensions

A BILL

To provide for the establishment of an assistance program

for health insurance consumers.

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 ‘‘Health Care Consumer

5 Assistance Act’’.

6 SEC. 2. GRANTS.

7 (a) IN GENERAL.—The Secretary of Health and

8 Human Services (referred to in this Act as the ‘‘Sec9 retary’’) shall award grants to States to enable such

10 States to enter into contracts for the establishment of con-
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1 sumer assistance programs designed to assist consumers

2 of health insurance in understanding their rights, respon3 sibilities and choices among health insurance products.

4 (b) ELIGIBILITY.—To be eligible to receive a grant

5 under this section a State shall prepare and submit to the

6 Secretary an application at such time, in such manner,

7 and containing such information as the Secretary may re8 quire, including a State plan that describes—

9 (1) the manner in which the State will solicit

10 proposals for, and enter into a contract with, an en11 tity eligible under section 3 to serve as the health in12 surance consumer office for the State; and

13 (2) the manner in which the State will ensure

14 that advice and assistance services for health insur15 ance consumers are coordinated through the office

16 described in paragraph (1).

17 (c) AMOUNT OF GRANT.—

18 (1) IN GENERAL.—From amounts appropriated

19 under section 5 for a fiscal year, the Secretary shall

20 award a grant to a State in an amount that bears

21 the same ratio to such amounts as the number of in22 dividuals within the State covered under a health in23 surance plan (as determined by the Secretary) bears

24 to the total number of individuals covered under a

25 health insurance plan in all States (as determined by
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1 the Secretary). Any amounts provided to a State

2 under this section that are not used by the State

3 shall be remitted to the Secretary and reallocated in

4 accordance with this paragraph.

5 (2) MINIMUM AMOUNT.—In no case shall the

6 amount provided to a State under a grant under this

7 section for a fiscal year be less than an amount

8 equal to .5 percent of the amount appropriated for

9 such fiscal year under section 5.

10 SEC. 3. ELIGIBILITY OF STATE ENTITIES.

11 To be eligible to enter into a contract with a State

12 and operate as the health insurance consumer office for

13 the State under this Act, an entity shall—

14 (1) be an independent, nonprofit entity with

15 demonstrated experience in serving the needs of

16 health care consumers (particularly low income and

17 other consumers who are most in need of consumer

18 assistance);

19 (2) prepare and submit to the State a proposal

20 containing such information as the State may re21 quire;

22 (3) demonstrate that the entity has the tech23 nical, organizational, and professional capacity to

24 operate the health insurance consumer office within

25 the State;
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1 (4) provide assurances that the entity has no

2 real or perceived conflict of interest in providing ad3 vice and assistance to consumers regarding health

4 insurance and that the entity is independent of

5 health insurance plans, companies, providers, payers,

6 and regulators of care; and

7 (5) demonstrate that, using assistance provided

8 by the State, the entity has the capacity to provide

9 assistance and advice throughout the State to public

10 and private health insurance consumers regardless

11 of the source of coverage.

12 SEC. 4. USE OF FUNDS.

13 (a) BY STATE.—A State shall use amounts received

14 under a grant under this Act to enter into a contract de15 scribed in section 2(a) to provide funds for the establish16 ment and operation of a health insurance consumer office.

17 (b) BY ENTITY.—

18 (1) IN GENERAL.—An entity that enters into a

19 contract with a State under this Act shall use

20 amounts received under the contract to establish and

21 operate a health insurance consumer office.

22 (2) NONCOMPLIANCE.—If the State fails to

23 enter into a contract under subsection (a), the Sec24 retary shall withhold amounts to be provided to the

25 State under this Act and use such amounts to enter
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1 into the contract described in paragraph (1) for the

2 State.

3 (c) ACTIVITIES OF OFFICE.—A health insurance con4 sumer office established under this Act shall—

5 (1) provide information to health insurance con6 sumers within the State relating to choice of health

7 insurance products and the rights and responsibil8 ities of consumers and insurers under such products;

9 (2) operate toll-free telephone hotlines to re10 spond to requests for information, advice or assist11 ance concerning health insurance in a timely and ef12 ficient manner;

13 (3) produce and disseminate educational mate14 rials concerning health insurance consumer and pa15 tient rights;

16 (4) provide assistance and representation (in

17 nonlitigative settings) to individuals who desire to

18 appeal the denial, termination, or reduction of health

19 care services, or the refusal to pay for such services,

20 under a health insurance plan;

21 (5) make referrals to appropriate private and

22 public individuals or entities so that inquiries, prob23 lems, and grievances with respect to health insur24 ance can be handled promptly and efficiently; and
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1 (6) collect data concerning inquiries, problems,

2 and grievances handled by the office and periodically

3 disseminate a compilation and analysis of such infor4 mation to employers, health plans, health insurers,

5 regulatory agencies, and the general public.

6 (d) AVAILABILITY OF SERVICES.—The office shall

7 not discriminate in the provision of services regardless of

8 the source of the individual’s health insurance coverage

9 or prospective coverage, including individuals covered

10 under employer-provided insurance, self-funded plans, the

11 medicare or medicaid programs under title XVIII or XIX

12 of the Social Security Act (42 U.S.C. 1395 and 1396 et

13 seq.), or under any other Federal or State health care pro14 gram.

15 (e) SUBCONTRACTS.—An office established under

16 this section may carry out activities and provide services

17 through contracts entered into with 1 or more nonprofit

18 entities so long as the office can demonstrate that all of

19 the requirements of this Act are met by the office.

20 (f) TRAINING.—

21 (1) IN GENERAL.—An office established under

22 this section shall ensure that personnel employed by

23 the office possess the skills, expertise, and informa24 tion necessary to provide the services described in

25 subsection (c).
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1 (2) CONTRACTS.—To meet the requirement of

2 paragraph (1), an office may enter into contracts

3 with 1 or more nonprofit entities for the training

4 (both through technical and educational assistance)

5 of personnel and volunteers. To be eligible to receive

6 a contract under this paragraph, an entity shall be

7 independent of health insurance plans, companies,

8 providers, payers, and regulators of care.

9 (3) LIMITATION.—Not to exceed 7 percent of

10 the amount awarded to an entity under a contract

11 under subsection (a) for a fiscal year may be used

12 for the provision of training under this section.

13 (g) ADMINISTRATIVE COSTS.—Not to exceed 1 per14 cent of the amount of a block grant awarded to the State

15 under subsection (a) for a fiscal year may be used for ad16 ministrative expenses by the State.

17 (h) TERM.—A contract entered into under subsection

18 (a) shall be for a term of 3 years.

19 SEC. 5. FUNDING.

20 (a) AUTHORIZATION OF APPROPRIATIONS.—There

21 are authorized to be appropriated such sums as may be

22 necessary in each fiscal year to carry out this Act.

23 (b) REPORT OF SECRETARY.—Not later than 1 year

24 after the date of enactment of this Act, and annually

25 thereafter, the Secretary shall prepare and submit to the
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1 appropriate committees of Congress a report that

2 contains—

3 (1) a determination by the Secretary of whether

4 amounts appropriated to carry out this Act for the

5 fiscal year for which this report is being prepared

6 are sufficient to fully fund this Act in such fiscal

7 year; and

8 (2) with respect to a fiscal year for which the

9 Secretary determines under paragraph (1) that suf10 ficient amounts are not appropriated, the rec11 ommendations of the Secretary for fully funding this

12 Act through the use of additional funding sources.

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