I 
109TH CONGRESS 
1ST SESSION H. R. 1322 
To amend title I of the Employee Retirement Income Security Act of 1974 
to provide emergency protection for retiree health benefits. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 15, 2005 
Mr. TIERNEY introduced the following bill; which was referred to the 
Committee on Education and the Workforce 
A BILL 
To amend title I of the Employee Retirement Income Secu-
rity Act of 1974 to provide emergency protection for 
retiree health benefits. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Emergency Retiree 
Health Benefits Protection Act of 2005’’. 
SEC. 2. FINDINGS AND PURPOSES. 
(a) FINDINGS.—The Congress finds the following: 
(1) Retired participants of group health plans 
regulated by the Employee Retirement Income Secu-
rity Act of 1974 (ERISA) have been severely
harmed by the virtually unchecked practices of spon-
sors of such plans involving the post-retirement can-
cellation or reduction of health benefits which retir-
ees counted on receiving for their lifetimes. 
(2) Such widespread post-retirement reductions 
in retiree health benefits has led to a crisis in retiree 
health care in which retirees— 
(A) have been unable to substitute indi-
vidual coverage for the group coverage they 
lost, or, in order to obtain individual coverage, 
have jeopardized their economic security in re-
tirement; 
(B) because of preexisting medical condi-
tions cannot obtain substitute coverage that 
they can afford without depleting their life sav-
ings or have been unable to obtain adequate 
medical care or medical care they had relied on 
to deal with serious illness; 
(C) have sustained catastrophic illnesses or 
injuries or otherwise experienced a marked de-
terioration in their medical conditions or health 
as a result of post-retirement changes to their 
medical benefits; 
(D) have been transferred indiscriminately 
into improperly or inadequately managed health
maintenance organizations or other managed 
care entities, resulting in the worsening rather 
than improvement of prior medical conditions; 
and 
(E) in many instances, have failed to ob-
tain adequate relief in the courts due to highly 
restrictive judicial interpretations which are in-
consistent with ERISA’s underlying protective 
purposes. 
(3) The crisis in retirees healthcare generated 
by the plan sponsor practice of post-retirement can-
cellations or reductions of previously promised re-
tiree health benefits has led to a widespread loss of 
confidence in the integrity of ERISA-regulated 
group health plans and the ability of ERISA itself 
to adequately protect retiree health benefits. 
(4) A strong and dependable private sector re-
tiree health system is necessary to the essential 
health of our Nation’s senior citizens. 
(b) PURPOSES.—The purposes of this Act are to en-
sure that the reasonable health benefit expectations of re-
tirees from ERISA-regulated group health plans are ful-
filled, to minimize the incidence of prolonged legal dis-
putes arising out of the post-retirement cancellation or re-
duction of retiree health benefits from such plans, and to
prevent further adverse effects on retiree health arising 
from such post-retirement changes. To this end, the pur-
poses of this Act also include the following: 
(1) to safeguard retired participants of group 
health plans subject to the Employee Retirement In-
come Security Act of 1974 (29 U.S.C. 1001 et seq.) 
from loss or reduction of their health benefits from 
such plans by barring plan sponsors from canceling 
or reducing such benefits after the dates such par-
ticipants retire and when they no longer are able to 
absorb such losses or reductions without experi-
encing adverse effects on their health or finances; 
(2) to establish an enforceable obligation on the 
part of sponsors of such group health plans to re-
store health benefits previously taken away from re-
tired participants of such plans to the extent such 
benefits were canceled or altered after the dates 
such participants retired and the plan sponsor would 
not sustain substantial business hardship by restor-
ing such benefits; and 
(3) to establish an Emergency Retiree Health 
Loan Guarantee Program to assist sponsors of 
group health plans subject to the obligation to re-
store retiree health benefits under this Act to obtain 
credit to assist them in discharging such obligations
by providing retiree health loan guarantees that 
would encourage the availability of such credit. 
SEC. 3. AMENDMENT OF EMPLOYEE RETIREMENT INCOME 
SECURITY ACT OF 1974 TO PROVIDE RETIREE 
HEALTH BENEFIT PROTECTIONS IN GROUP 
HEALTH PLANS. 
(a) IN GENERAL.—Subtitle B of title I of the Em-
ployee Retirement Income Security Act of 1974 is amend-
ed by adding at the end a new part 8 as follows: 
‘‘PART 8—EMERGENCY RETIREE HEALTH 
BENEFIT PROTECTIONS 
‘‘SEC. 801. PROHIBITION AGAINST POST-RETIREMENT RE-
DUCTIONS OF RETIREE HEALTH BENEFITS 
BY GROUP HEALTH PLANS. 
‘‘(a) IN GENERAL.—Notwithstanding that a group 
health plan described in subsection (b) may contain a pro-
vision reserving the general power to amend or terminate 
the plan or a provision specifically authorizing the plan 
to make post-retirement reductions in retiree health bene-
fits, it shall be prohibited for any group health plan, 
whether through amendment or otherwise, to reduce the 
benefits provided to a retired participant or his or her ben-
eficiary under the terms of the plan if such reduction of 
benefits occurs after the date the participant retired for 
purposes of the plan and reduces benefits that were pro-
vided to the participant, or his or her beneficiary, as of 
the date the participant retired. Any group health plan 
provision which purports to authorize the reduction of 
benefits in a manner inconsistent with the foregoing prohi-
bition shall be void as against public policy. 
‘‘(b) GROUP
HEALTH
PLAN.—The term ‘group 
health plan’ shall have the same meaning as in section 
607(1). 
‘‘(c) PROHIBITED REDUCTION
OF BENEFITS.—As 
used in this section, references to a prohibited reduction 
of benefits means any group health plan amendment or 
other action which has the effect of— 
‘‘(1) canceling, decreasing or limiting the 
amount, type, level, or form of any benefit or option 
provided prior to the amendment or action; 
‘‘(2) imposing or increasing the out-of-pocket 
costs a retired participant, or his or her beneficiary, 
must pay in order to keep or obtain any benefits 
that were provided to the participant or beneficiary 
prior to the amendment or action; or 
‘‘(3) modifying the manner by which medical 
services are delivered under the plan so that after 
the amendment or action a retired participant, or 
his or her beneficiary, has less ready access to the 
delivery of any such medical services than the partic-
ipant or beneficiary had prior to the amendment or 
action. 
‘‘(d) TREATMENT OF PLAN TERMINATION.— 
‘‘(1) IN GENERAL.—Subject to paragraph (2), a 
termination of a group health plan shall be treated 
as violating the prohibition contained in this section 
if, after the termination, the plan sponsor of the ter-
minated plan fails to continue to provide to the par-
ticipants who retired prior to the termination and to 
their beneficiaries the same retiree health benefits 
that were provided prior to the termination. 
‘‘(2) WAIVER.—Paragraph (1) shall not apply 
in the case of the termination of a group health plan 
if the Secretary issues a waiver under this para-
graph in connection with such termination. The Sec-
retary shall issue such a waiver if and only if the 
plan sponsor demonstrates to the satisfaction of the 
Secretary, in accordance with regulations prescribed 
by the Secretary, that such plan sponsor will be un-
able to continue in business unless such a waiver is 
issued. 
‘‘(e) CONSENT
OR AUTHORIZATION
BY PARTICI-
PANT.—A reduction of benefits shall not be treated as pro-
hibited by this section if such reduction is consented to 
in writing by any retired participant or is authorized with
respect to the retired participant under the terms of one 
or more agreements which the Secretary finds to be collec-
tive bargaining agreements between one or more employee 
representatives who were representing such participant at 
the time of the entry into such agreement and one or more 
employers. 
‘‘SEC. 802. ADOPTION BY GROUP HEALTH PLANS OF PROVI-
SION BARRING POST-RETIREMENT REDUC-
TIONS IN RETIREE HEALTH BENEFITS. 
‘‘Every group health plan shall contain a provision 
which expressly bars the plan, or any fiduciary of the plan, 
from reducing the benefits provided under the plan to a 
retired participant, or his or her beneficiary, if such reduc-
tion affects the benefits provided to the participant or ben-
eficiary as of the date the participant retired for purposes 
of the plan and such reduction occurs after the partici-
pant’s retirement. 
‘‘SEC. 803. RESTORATION BY GROUP HEALTH PLANS OF 
BENEFITS REDUCED AFTER RETIREMENT. 
‘‘(a) IN GENERAL.—The plan sponsor of each group 
health plan shall provide, in accordance with this section, 
the option of benefit restoration to each retired participant 
that meets the following requirements: 
‘‘(1) The retired participant is entitled to ben-
efit coverage under the plan as of the date of enact-
ment of the Emergency Retiree Health Benefits Pro-
tection Act of 2005. 
‘‘(2) The amount, type, level, or form of any 
benefits or option provided to the retired participant 
under the plan as of the date the participant retired 
was reduced after the participant’s date of retire-
ment. For purposes of the preceding sentence, the 
term ‘reduced’ has the same meaning as in section 
801(c). 
‘‘(3) The retired participant has elected to re-
store benefits under the plan within the restoration 
period prescribed by subsection (c) and in accord-
ance with such procedures established by the plan 
pursuant to regulations of the Secretary. 
‘‘(b) EXCEPTION FOR CERTAIN PLANS.—In accord-
ance with regulations prescribed by the Secretary, sub-
section (a) shall not apply to any group health plan with 
less than 100 participants both on and after the date of 
enactment of the Emergency Retiree Health Benefits Pro-
tection Act of 2005. 
‘‘(c) RESTORATION PERIOD.—The term ‘restoration 
period’ means the period which— 
‘‘(1) begins not later than 1 year after the date 
of enactment of the Emergency Retiree Health Ben-
efits Protection Act of 2005;
‘‘(2) ends before 2 years from such date, unless 
extended by the Secretary pursuant to section 
804(g); and 
‘‘(3) is of no less than 60 days duration. 
‘‘(d) NOTICE REQUIREMENTS CONCERNING RES-
TORATION OF BENEFITS.—In accordance with regulations 
prescribed by the Secretary, each group health plan sub-
ject to the requirements of subsection (a) shall, within no 
less than 30 days prior to the commencement of the plan’s 
restoration of benefits period, provide written notice to 
each retired participant of the plan who meets the require-
ments of subsection (a) of the following: 
‘‘(1) A description of all benefits the retired 
participant is entitled to have restored. 
‘‘(2) The administrative procedure established 
under the plan which may be used to submit a claim 
for the restoration of any benefits. 
‘‘(3) An itemization of the value of each benefit 
the retired participant is entitled to have restored, 
as determined in accordance with regulations of the 
Secretary, and the total value of all such benefits. 
‘‘(4) A description of any post-retirement in-
creases in retiree health benefits the retired partici-
pant received which the plan sponsor could rescind
if the retired participant asserts a claim for the res-
toration of benefits. 
‘‘(5) An itemization of the value of each retiree 
health benefit the plan sponsor could rescind, as de-
termined in accordance with regulations of the Sec-
retary, and the total value of all such benefits. 
‘‘(6) If the plan sponsor has filed an application 
for a substantial business hardship exemption under 
section 804, the date such application was filed, the 
date notice of such application was given to retired 
participants entitled to submit a claim for the res-
toration of benefits, and the status of such applica-
tion as of the date of the notice sent pursuant to 
this subsection. 
‘‘(7) Such other information in such form and 
detail as may be prescribed by the Secretary to carry 
out the purposes of this part. 
‘‘(e) DEADLINE FOR RESTORATION OF BENEFITS.— 
Regardless of any extension that may be granted by the 
Secretary pursuant to section 804(g), all benefits required 
to be restored under this section shall be restored within 
no more than 3 years from the date of enactment of the 
Emergency Retiree Health Benefits Protection Act of 
2005, or the date the plan sponsor files an application for 
an exemption under section 804, whichever comes last.
‘‘SEC. 804. EXEMPTION FROM RESTORATION OF BENEFITS 
REQUIREMENTS. 
‘‘(a) APPLICATION
FOR
EXEMPTION.—Any plan 
sponsor of a group health plan that would sustain substan-
tial business hardship if required to fulfill, in whole or in 
part, the restoration of benefits requirements contained in 
section 803, may file an application for an exemption with 
the Secretary from any or all of such requirements. 
‘‘(b) AUTHORITY FOR WAIVER OR VARIANCE.—In re-
sponse to an application filed by a plan sponsor pursuant 
to subsection (a), the Secretary may waive or vary the re-
quirements of section 803 with respect to any or all of 
such requirements, including postponing for reasonable 
periods of time the obligation of the plan sponsor to re-
store reduced benefits, if the Secretary finds that compli-
ance by the plan sponsor with the requirements of section 
803 would— 
‘‘(1) be adverse to the interests of plan partici-
pants in the aggregate; 
‘‘(2) not be administratively feasible; and 
‘‘(3) cause substantial business hardship to the 
plan sponsor. 
‘‘(c) FACTORS TAKEN INTO ACCOUNT.—For pur-
poses of this section, the factors to be taken into account 
in determining substantial business hardship shall include 
(but shall not be limited to) whether—
‘‘(1) the plan sponsor is operating at an eco-
nomic loss; 
‘‘(2) compliance with the restoration of benefits 
requirements would necessitate substantial future re-
ductions in health benefits provided to participants 
under the plan or cause a substantial decline in em-
ployment with the plan sponsor; 
‘‘(3) it is reasonable to expect that the plan will 
be continued only if a waiver or appropriate variance 
is granted; and 
‘‘(4) the provisions of the Retiree Health Loan 
Guarantee Program established under section 805 
are unavailable to the plan sponsor submitting the 
application, or, if available, still would not provide a 
sufficient basis for denying a waiver or variance. 
‘‘(d) REQUIREMENT OF SATISFACTORY EVIDENCE.— 
‘‘(1) IN GENERAL.—The Secretary shall, before 
granting a waiver or variance under this section, re-
quire each applicant to provide evidence satisfactory 
to the Secretary that the applicant has provided 
timely written notice of the filing of an application 
for such waiver or variance to each retired partici-
pant entitled to submit a claim for the restoration 
of benefits under the applicant’s plan.