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‘‘(1) ALLOWANCE OF DEDUCTION.—In the case
of an individual who is an employee within the
meaning of section 401(c)(1), there shall be allowed
as a deduction under this section an amount equal
to 100 percent of the amount paid during the tax-
able year for insurance which constitutes medical
care for the taxpayer and the taxpayer’s spouse and
dependents.’’.
(b) EFFECTIVE DATE.—The amendment made by
this section shall apply to taxable years beginning after
December 31, 2001.
SEC. 513. CREDIT FOR HEALTH INSURANCE EXPENSES OF
SMALL BUSINESSES.
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of
1986 (relating to business-related credits) is amended by
adding at the end the following:
‘‘SEC. 45E. SMALL BUSINESS HEALTH INSURANCE EX-
PENSES.
‘‘(a) GENERAL RULE.—For purposes of section 38,
in the case of a small employer, the health insurance credit
determined under this section for the taxable year is an
amount equal to the applicable percentage of the expenses
paid by the taxpayer during the taxable year for health
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insurance coverage for such year provided under a new
health plan for employees of such employer.
‘‘(b) APPLICABLE PERCENTAGE.—For purposes of
subsection (a), the applicable percentage is—
‘‘(1) in the case of insurance purchased as a
member of a qualified health benefit purchasing coa-
lition (as defined in section 9841), 30 percent, and
‘‘(2) in the case of insurance not described in
paragraph (1), 20 percent.
‘‘(c) LIMITATIONS.—
‘‘(1) PER
EMPLOYEE
DOLLAR
LIMITATION.—
The amount of expenses taken into account under
subsection (a) with respect to any employee for any
taxable year shall not exceed—
‘‘(A) $2,000 in the case of self-only cov-
erage, and
‘‘(B) $5,000 in the case of family coverage.
In the case of an employee who is covered by a new
health plan of the employer for only a portion of
such taxable year, the limitation under the preceding
sentence shall be an amount which bears the same
ratio to such limitation (determined without regard
to this sentence) as such portion bears to the entire
taxable year.
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‘‘(2) PERIOD OF COVERAGE.—Expenses may be
taken into account under subsection (a) only with
respect to coverage for the 4-year period beginning
on the date the employer establishes a new health
plan.
‘‘(d) DEFINITIONS.—For purposes of this section—
‘‘(1) HEALTH
INSURANCE
COVERAGE.—The
term ‘health insurance coverage’ has the meaning
given such term by section 9832(b)(1).
‘‘(2) NEW HEALTH PLAN.—
‘‘(A) IN GENERAL.—The term ‘new health
plan’ means any arrangement of the employer
which provides health insurance coverage to em-
ployees if—
‘‘(i) such employer (and any prede-
cessor employer) did not establish or main-
tain such arrangement (or any similar ar-
rangement) at any time during the 2 tax-
able years ending prior to the taxable year
in which the credit under this section is
first allowed, and
‘‘(ii) 
such 
arrangement 
provides
health insurance coverage to at least 70
percent of the qualified employees of such
employer.
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‘‘(B) QUALIFIED EMPLOYEE.—
‘‘(i) IN GENERAL.—The term ‘quali-
fied employee’ means any employee of an
employer if the annual rate of such em-
ployee’s compensation (as defined in sec-
tion 414(s)) exceeds $10,000.
‘‘(ii) TREATMENT
OF
CERTAIN
EM-
PLOYEES.—The term ‘employee’ shall in-
clude a leased employee within the mean-
ing of section 414(n).
‘‘(3) SMALL EMPLOYER.—The term ‘small em-
ployer’ has the meaning given to such term by sec-
tion 4980D(d)(2); except that only qualified employ-
ees shall be taken into account.
‘‘(e) SPECIAL RULES.—
‘‘(1) CERTAIN RULES MADE APPLICABLE.—For
purposes of this section, rules similar to the rules of
section 52 shall apply.
‘‘(2) AMOUNTS
PAID
UNDER
SALARY
REDUC-
TION ARRANGEMENTS.—No amount paid or incurred
pursuant to a salary reduction arrangement shall be
taken into account under subsection (a).
‘‘(f) TERMINATION.—This section shall not apply to
expenses paid or incurred by an employer with respect to
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any arrangement established on or after January 1,
2010.’’.
(b) CREDIT TO BE PART OF GENERAL BUSINESS
CREDIT.—Section 38(b) of such Code (relating to current
year business credit) is amended by striking ‘‘plus’’ at the
end of paragraph (12), by striking the period at the end
of paragraph (13) and inserting ‘‘, plus’’, and by adding
at the end the following:
‘‘(14) in the case of a small employer (as de-
fined in section 45E(d)(3)), the health insurance
credit determined under section 45E(a).’’.
(c) NO CARRYBACKS.—Subsection (d) of section 39
of such Code (relating to carryback and carryforward of
unused credits) is amended by adding at the end the fol-
lowing:
‘‘(10) NO CARRYBACK OF SECTION 45E CREDIT
BEFORE EFFECTIVE DATE.—No portion of the un-
used business credit for any taxable year which is
attributable to the employee health insurance ex-
penses credit determined under section 45E may be
carried back to a taxable year ending before the date
of the enactment of section 45E.’’.
(d) DENIAL OF DOUBLE BENEFIT.—Section 280C of
such Code is amended by adding at the end the following
new subsection:
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‘‘(d) CREDIT FOR SMALL BUSINESS HEALTH INSUR-
ANCE EXPENSES.—
‘‘(1) IN GENERAL.—No deduction shall be al-
lowed for that portion of the expenses (otherwise al-
lowable as a deduction) taken into account in deter-
mining the credit under section 45E for the taxable
year which is equal to the amount of the credit de-
termined for such taxable year under section
45E(a).
‘‘(2) CONTROLLED
GROUPS.—Persons treated
as a single employer under subsection (a) or (b) of
section 52 shall be treated as 1 person for purposes
of this section.’’.
(e) CLERICAL AMENDMENT.—The table of sections
for subpart D of part IV of subchapter A of chapter 1
of such Code is amended by adding at the end the fol-
lowing:
‘‘Sec. 45E. Small business health insurance expenses.’’.
(f) EFFECTIVE DATE.—The amendments made by
this section shall apply to amounts paid or incurred in tax-
able years beginning after December 31, 2001, for ar-
rangements established after the date of the enactment
of this Act.
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SEC. 514. CERTAIN GRANTS BY PRIVATE FOUNDATIONS TO
QUALIFIED HEALTH BENEFIT PURCHASING
COALITIONS.
(a) IN GENERAL.—Section 4942 of the Internal Rev-
enue Code of 1986 (relating to taxes on failure to dis-
tribute income) is amended by adding at the end the fol-
lowing:
‘‘(k) CERTAIN QUALIFIED HEALTH BENEFIT PUR-
CHASING COALITION DISTRIBUTIONS.—
‘‘(1) IN GENERAL.—For purposes of subsection
(g), sections 170, 501, 507, 509, and 2522, and this
chapter, a qualified health benefit purchasing coali-
tion distribution by a private foundation shall be
considered to be a distribution for a charitable pur-
pose.
‘‘(2) 
QUALIFIED
HEALTH
BENEFIT
PUR-
CHASING COALITION DISTRIBUTION.—For purposes
of paragraph (1)—
‘‘(A) IN
GENERAL.—The term ‘qualified
health benefit purchasing coalition distribution’
means any amount paid or incurred by a pri-
vate foundation to or on behalf of a qualified
health benefit purchasing coalition (as defined
in section 9841) for purposes of payment or re-
imbursement of amounts paid or incurred in
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connection with the establishment and mainte-
nance of such coalition.
‘‘(B) EXCLUSIONS.—Such term shall not
include any amount used by a qualified health
benefit purchasing coalition (as so defined)—
‘‘(i) for the purchase of real property,
‘‘(ii) as payment to, or for the benefit
of, members (or employees or affiliates of
such members) of such coalition, or
‘‘(iii) for any expense paid or incurred
more than 48 months after the date of es-
tablishment of such coalition.
‘‘(3) TERMINATION.—This subsection shall not
apply—
‘‘(A) to qualified health benefit purchasing
coalition distributions paid or incurred after
December 31, 2009, and
‘‘(B) with respect to start-up costs of a co-
alition which are paid or incurred after Decem-
ber 31, 2010.’’.
(b) QUALIFIED HEALTH BENEFIT PURCHASING CO-
ALITION.—
(1) IN GENERAL.—Chapter 100 of such Code
(relating to group health plan requirements) is
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amended by adding at the end the following new
subchapter:
‘‘Subchapter D—Qualified Health Benefit
Purchasing Coalition
‘‘Sec.
9841.
Qualified health benefit purchasing coalition.
‘‘SEC. 9841. QUALIFIED HEALTH BENEFIT PURCHASING CO-
ALITION.
‘‘(a) IN GENERAL.—A qualified health benefit pur-
chasing coalition is a private not-for-profit corporation
which—
‘‘(1) sells health insurance through State li-
censed health insurance issuers in the State in which
the employers to which such coalition is providing
insurance are located, and
‘‘(2) establishes to the Secretary, under State
certification procedures or other procedures as the
Secretary may provide by regulation, that such coali-
tion meets the requirements of this section.
‘‘(b) BOARD OF DIRECTORS.—
‘‘(1) IN GENERAL.—Each purchasing coalition
under this section shall be governed by a Board of
Directors.
‘‘(2) ELECTION.—The Secretary shall establish
procedures governing election of such Board.
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‘‘(3) MEMBERSHIP.—The Board of Directors
shall—
‘‘(A) be composed of representatives of the
members of the coalition, in equal number, in-
cluding small employers and employee rep-
resentatives of such employers, but
‘‘(B) not include other interested parties,
such as service providers, health insurers, or in-
surance agents or brokers which may have a
conflict of interest with the purposes of the coa-
lition.
‘‘(c) MEMBERSHIP OF COALITION.—
‘‘(1) IN
GENERAL.—A purchasing coalition
shall accept all small employers residing within the
area served by the coalition as members if such em-
ployers request such membership.
‘‘(2) OTHER MEMBERS.—The coalition, at the
discretion of its Board of Directors, may be open to
individuals and large employers.
‘‘(3) VOTING.—Members of a purchasing coali-
tion shall have voting rights consistent with the rules
established by the State.
‘‘(d) DUTIES OF PURCHASING COALITIONS.—Each
purchasing coalition shall—
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‘‘(1) enter into agreements with small employ-
ers (and, at the discretion of its Board, with individ-
uals and other employers) to provide health insur-
ance benefits to employees and retirees of such em-
ployers,
‘‘(2) where feasible, enter into agreements with
3 or more unaffiliated, qualified licensed health
plans, to offer benefits to members,
‘‘(3) offer to members at least 1 open enroll-
ment period of at least 30 days per calendar year,
‘‘(4) serve a significant geographical area and
market to all eligible members in that area, and
‘‘(5) carry out other functions provided for
under this section.
‘‘(e) LIMITATION ON ACTIVITIES.—A purchasing coa-
lition shall not—
‘‘(1) perform any activity (including certifi-
cation or enforcement) relating to compliance or li-
censing of health plans,
‘‘(2) assume insurance or financial risk in rela-
tion to any health plan, or
‘‘(3) perform other activities identified by the
State as being inconsistent with the performance of
its duties under this section.
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‘‘(f) ADDITIONAL REQUIREMENTS FOR PURCHASING
COALITIONS.—As provided by the Secretary in regula-
tions, a purchasing coalition shall be subject to require-
ments similar to the requirements of a group health plan
under this chapter.
‘‘(g) RELATION TO OTHER LAWS.—
‘‘(1) 
PREEMPTION
OF
STATE
FICTITIOUS
GROUP LAWS.—Requirements (commonly referred to
as fictitious group laws) relating to grouping and
similar requirements for health insurance coverage
are preempted to the extent such requirements im-
pede the establishment and operation of qualified
health benefit purchasing coalitions.
‘‘(2) ALLOWING
SAVINGS
TO
BE
PASSED
THROUGH.—Any State law that prohibits health in-
surance issuers from reducing premiums on health
insurance coverage sold through a qualified health
benefit purchasing coalition to reflect administrative
savings is preempted. This paragraph shall not be
construed to preempt State laws that impose restric-
tions on premiums based on health status, claims
history, industry, age, gender, or other underwriting
factors.
‘‘(3) NO WAIVER OF HIPAA REQUIREMENTS.—
Nothing in this section shall be construed to change
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the obligation of health insurance issuers to comply
with the requirements of title XXVII of the Public
Health Service Act with respect to health insurance
coverage offered to small employers in the small
group market through a qualified health benefit pur-
chasing coalition.
‘‘(h) DEFINITION OF SMALL EMPLOYER.—For pur-
poses of this section—
‘‘(1) IN GENERAL.—The term ‘small employer’
means, with respect to any calendar year, any em-
ployer if such employer employed an average of at
least 2 and not more than 50 qualified employees on
business days during either of the 2 preceding cal-
endar years. For purposes of the preceding sentence,
a preceding calendar year may be taken into account
only if the employer was in existence throughout
such year.
‘‘(2) EMPLOYERS NOT IN EXISTENCE IN PRE-
CEDING YEAR.—In the case of an employer which
was not in existence throughout the 1st preceding
calendar year, the determination under paragraph
(1) shall be based on the average number of quali-
fied employees that it is reasonably expected such
employer will employ on business days in the current
calendar year.’’.
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(2) CONFORMING AMENDMENT.—The table of
subchapters for chapter 100 of such Code is amend-
ed by adding at the end the following item:
‘‘Subchapter D. Qualified health benefit purchasing coalition.’’.
(c) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to taxable years beginning after
December 31, 2001.
SEC. 515. STATE GRANT PROGRAM FOR MARKET INNOVA-
TION.
(a) IN GENERAL.—The Secretary of Health and
Human Services (in this section referred to as the ‘‘Sec-
retary’’) shall establish a program (in this section referred
to as the ‘‘program’’) to award demonstration grants
under this section to States to allow States to demonstrate
the effectiveness of innovative ways to increase access to
health insurance through market reforms and other inno-
vative means. Such innovative means may include (and are
not limited to) any of the following:
(1) Alternative group purchasing or pooling ar-
rangements, such as purchasing cooperatives for
small businesses, reinsurance pools, or high risk
pools.
(2) Individual or small group market reforms.
(3) Consumer education and outreach.
(4) Subsidies to individuals, employers, or both,
in obtaining health insurance.
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(b) SCOPE; DURATION.—The program shall be lim-
ited to not more than 10 States and to a total period of
5 years, beginning on the date the first demonstration
grant is made.
(c) CONDITIONS FOR DEMONSTRATION GRANTS.—
(1) IN GENERAL.—The Secretary may not pro-
vide for a demonstration grant to a State under the
program unless the Secretary finds that under the
proposed demonstration grant—
(A) the State will provide for demonstrated
increase of access for some portion of the exist-
ing uninsured population through a market in-
novation (other than merely through a financial
expansion of a program initiated before the
date of the enactment of this Act);
(B) the State will comply with applicable
Federal laws;
(C) the State will not discriminate among
participants on the basis of any health status-
related factor (as defined in section 2791(d)(9)
of the Public Health Service Act), except to the
extent a State wishes to focus on populations
that otherwise would not obtain health insur-
ance because of such factors; and
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(D) the State will provide for such evalua-
tion, in coordination with the evaluation re-
quired under subsection (d), as the Secretary
may specify.
(2) APPLICATION.—The Secretary shall not
provide a demonstration grant under the program to
a State unless—
(A) the State submits to the Secretary
such an application, in such a form and man-
ner, as the Secretary specifies;
(B) the application includes information
regarding how the demonstration grant will ad-
dress issues such as governance, targeted popu-
lation, expected cost, and the continuation after
the completion of the demonstration grant pe-
riod; and
(C) the Secretary determines that the dem-
onstration grant will be used consistent with
this section.
(3) FOCUS.—A demonstration grant proposal
under section need not cover all uninsured individ-
uals in a State or all health care benefits with re-
spect to such individuals.
(d) EVALUATION.—The Secretary shall enter into a
contract with an appropriate entity outside the Depart-
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ment of Health and Human Services to conduct an overall
evaluation of the program at the end of the program pe-
riod. Such evaluation shall include an analysis of improve-
ments in access, costs, quality of care, or choice of cov-
erage, under different demonstration grants.
(e) OPTION TO PROVIDE FOR INITIAL PLANNING
GRANTS.—Notwithstanding the previous provisions of this
section, under the program the Secretary may provide for
a portion of the amounts appropriated under subsection
(f) (not to exceed $5,000,000) to be made available to any
State for initial planning grants to permit States to de-
velop demonstration grant proposals under the previous
provisions of this section.
(f) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated $100,000,000 for each
fiscal year to carry out this section. Amounts appropriated
under this subsection shall remain available until ex-
pended.
(g) STATE DEFINED.—For purposes of this section,
the term ‘‘State’’ has the meaning given such term for
purposes of title XIX of the Social Security Act.
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TITLE 
VI—EFFECTIVE 
DATES;
COORDINATION 
IN 
IMPLE-
MENTATION
SEC. 601. EFFECTIVE DATES.
(a) GROUP HEALTH COVERAGE.—
(1) IN
GENERAL.—Subject to paragraph (2)
and subsection (d), the amendments made by sec-
tions 201(a), 401, 403, 501, and 502 (and title I in-
sofar as it relates to such sections) shall apply with
respect to group health plans, and health insurance
coverage offered in connection with group health
plans, for plan years beginning on or after October
1, 2002 (in this section referred to as the ‘‘general
effective date’’).
(2) TREATMENT OF COLLECTIVE BARGAINING
AGREEMENTS.—In the case of a group health plan
maintained pursuant to one or more collective bar-
gaining agreements between employee representa-
tives and one or more employers ratified before the
date of the enactment of this Act, the amendments
made by sections 201(a), 401, 403, 501, and 502
(and title I insofar as it relates to such sections)
shall not apply to plan years beginning before the
later of—
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(A) the date on which the last collective
bargaining agreements relating to the plan ter-
minates (excluding any extension thereof agreed
to after the date of the enactment of this Act);
or
(B) the general effective date,
but shall apply not later than 1 year after the gen-
eral effective date. For purposes of subparagraph
(A), any plan amendment made pursuant to a collec-
tive bargaining agreement relating to the plan which
amends the plan solely to conform to any require-
ment added by this Act shall not be treated as a ter-
mination of such collective bargaining agreement.
(b) INDIVIDUAL HEALTH INSURANCE COVERAGE.—
Subject to subsection (d), the amendments made by sec-
tion 202 shall apply with respect to individual health in-
surance coverage offered, sold, issued, renewed, in effect,
or operated in the individual market on or after the gen-
eral effective date.
(c) TREATMENT OF RELIGIOUS NONMEDICAL PRO-
VIDERS.—
(1) IN GENERAL.—Nothing in this Act (or the
amendments made thereby) shall be construed to—
(A) restrict or limit the right of group
health plans, and of health insurance issuers of-
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fering health insurance coverage, to include as
providers religious nonmedical providers;
(B) require such plans or issuers to—
(i) utilize medically based eligibility
standards or criteria in deciding provider
status of religious nonmedical providers;
(ii) use medical professionals or cri-
teria to decide patient access to religious
nonmedical providers;
(iii) utilize medical professionals or
criteria in making decisions in internal or
external appeals regarding coverage for
care by religious nonmedical providers; or
(iv) compel a participant or bene-
ficiary to undergo a medical examination
or test as a condition of receiving health
insurance coverage for treatment by a reli-
gious nonmedical provider; or
(C) require such plans or issuers to ex-
clude religious nonmedical providers because
they do not provide medical or other required
data, if such data is inconsistent with the reli-
gious nonmedical treatment or nursing care
provided by the provider.
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(2) RELIGIOUS NONMEDICAL PROVIDER.—For
purposes of this subsection, the term ‘‘religious non-
medical provider’’ means a provider who provides no
medical care but who provides only religious non-
medical treatment or religious nonmedical nursing
care.
(d) TRANSITION FOR NOTICE REQUIREMENT.—The
disclosure of information required under section 121 of
this Act shall first be provided pursuant to—
(1) subsection (a) with respect to a group
health plan that is maintained as of the general ef-
fective date, not later than 30 days before the begin-
ning of the first plan year to which title I applies
in connection with the plan under such subsection;
or
(2) subsection (b) with respect to a individual
health insurance coverage that is in effect as of the
general effective date, not later than 30 days before
the first date as of which title I applies to the cov-
erage under such subsection.
SEC. 602. COORDINATION IN IMPLEMENTATION.
The Secretary of Labor and the Secretary of Health
and Human Services shall ensure, through the execution
of an interagency memorandum of understanding among
such Secretaries, that—
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(1) regulations, rulings, and interpretations
issued by such Secretaries relating to the same mat-
ter over which such Secretaries have responsibility
under the provisions of this Act (and the amend-
ments made thereby) are administered so as to have
the same effect at all times; and
(2) coordination of policies relating to enforcing
the same requirements through such Secretaries in
order to have a coordinated enforcement strategy
that avoids duplication of enforcement efforts and
assigns priorities in enforcement.
SEC. 603. SEVERABILITY.
(a) IN GENERAL.—Except as provided in subsections
(b) and (c), if any provision of this Act, an amendment
made by this Act, or the application of such provision or
amendment to any person or circumstance is held to be
unconstitutional, the remainder of this Act, the amend-
ments made by this Act, and the application of the provi-
sions of such to any person or circumstance shall not be
affected thereby.
(b) DEPENDENCE OF REMEDIES ON APPEALS.—If
any provision of section 503A, 503B, or 503C of the Em-
ployee Retirement Income Security Act of 1974 (as in-
serted by section 131) or the application of either such
section to any person or circumstance is held to be uncon-
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stitutional, section 502(n) of such Act (as inserted by sec-
tion 402) shall be deemed to be null and void and shall
be given no force or effect.
(c) REMEDIES.—If any provision of section 502(n)
of the Employee Retirement Income Security Act of 1974
(as inserted by section 402), or the application of such
section to any person or circumstance, is held to be uncon-
stitutional, the remainder of such section shall be deemed
to be null and void and shall be given no force or effect.
TITLE VII—MISCELLANEOUS
PROVISIONS
SEC. 701. NO IMPACT ON SOCIAL SECURITY TRUST FUNDS.
(a) IN GENERAL.—Nothing in this Act (or an amend-
ment made by this Act) shall be construed to alter or
amend the Social Security Act (or any regulation promul-
gated under that Act).
(b) TRANSFERS.—
(1) ESTIMATE OF SECRETARY.—The Secretary
of the Treasury shall annually estimate the impact
that the enactment of this Act has on the income
and balances of the trust funds established under
section 201 of the Social Security Act (42 U.S.C.
401).
(2) TRANSFER
OF
FUNDS.—If, under para-
graph (1), the Secretary of the Treasury estimates
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that the enactment of this Act has a negative impact
on the income and balances of the trust funds estab-
lished under section 201 of the Social Security Act
(42 U.S.C. 401), the Secretary shall transfer, not
less frequently than quarterly, from the general reve-
nues of the Federal Government an amount suffi-
cient so as to ensure that the income and balances
of such trust funds are not reduced as a result of
the enactment of such Act.
SEC. 702. CUSTOMS USER FEES.
Section 13031(j)(3) of the Consolidated Omnibus
Budget Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3))
is amended by striking ‘‘2003’’ and inserting ‘‘2011, ex-
cept that fees may not be charged under paragraphs (9)
and (10) of such subsection after March 31, 2006’’.
SEC. 703. FISCAL YEAR 2002 MEDICARE PAYMENTS.
Notwithstanding any other provision of law, any let-
ter of credit under part B of title XVIII of the Social Se-
curity Act (42 U.S.C. 1395j et seq.) that would otherwise
be sent to the Treasury or the Federal Reserve Board on
September 30, 2002, by a carrier with a contract under
section 1842 of that Act (42 U.S.C. 1395u) shall be sent
on October 1, 2002.
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SEC. 704. SENSE OF THE SENATE WITH RESPECT TO PAR-
TICIPATION IN CLINICAL TRIALS AND AC-
CESS TO SPECIALTY CARE.
(a) FINDINGS.—The Senate finds the following:
(1) Breast cancer is the most common form of
cancer among women, excluding skin cancers.
(2) During 2001, 182,800 new cases of female
invasive breast cancer will be diagnosed, and 40,800
women will die from the disease.
(3) In addition, 1,400 male breast cancer cases
are projected to be diagnosed, and 400 men will die
from the disease.
(4) Breast cancer is the second leading cause of
cancer death among all women and the leading
cause of cancer death among women between ages
40 and 55.
(5) This year 8,600 children are expected to be
diagnosed with cancer.
(6) 1,500 children are expected to die from can-
cer this year.
(7) There are approximately 333,000 people di-
agnosed with multiple sclerosis in the United States
and 200 more cases are diagnosed each week.
(8) Parkinson’s disease is a progressive disorder
of the central nervous system affecting 1,000,000 in
the United States.
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(9) An estimated 198,100 men will be diag-
nosed with prostate cancer this year.
(10) 31,500 men will die from prostate cancer
this year. It is the second leading cause of cancer in
men.
(11) While information obtained from clinical
trials is essential to finding cures for diseases, it is
still research which carries the risk of fatal results.
Future efforts should be taken to protect the health
and safety of adults and children who enroll in clin-
ical trials.
(12) While employers and health plans should
be responsible for covering the routine costs associ-
ated with federally approved or funded clinical trials,
such employers and health plans should not be held
legally responsible for the design, implementation, or
outcome of such clinical trials, consistent with any
applicable State or Federal liability statutes.
(b) SENSE OF THE SENATE.—It is the sense of the
Senate that—
(1) men and women battling life-threatening,
deadly diseases, including advanced breast or ovar-
ian cancer, should have the opportunity to partici-
pate in a federally approved or funded clinical trial
recommended by their physician;
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(2) an individual should have the opportunity to
participate in a federally approved or funded clinical
trial recommended by their physician if—
(A) that individual—
(i) has a life-threatening or serious ill-
ness for which no standard treatment is ef-
fective;
(ii) is eligible to participate in a feder-
ally approved or funded clinical trial ac-
cording to the trial protocol with respect to
treatment of the illness;
(B) that individual’s participation in the
trial offers meaningful potential for significant
clinical benefit for the individual; and
(C) either—
(i) the referring physician is a partici-
pating health care professional and has
concluded that the individual’s participa-
tion in the trial would be appropriate,
based upon the individual meeting the con-
ditions described in subparagraph (A); or
(ii) the participant, beneficiary, or en-
rollee provides medical and scientific infor-
mation establishing that the individual’s
participation in the trial would be appro-
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priate, based upon the individual meeting
the conditions described in subparagraph
(A);
(3) a child with a life-threatening illness, in-
cluding cancer, should be allowed to participate in a
federally approved or funded clinical trial if that
participation meets the requirements of paragraph
(2);
(4) a child with a rare cancer should be allowed
to go to a cancer center capable of providing high
quality care for that disease; and
(5) a health maintenance organization’s deci-
sion that an in-network physician without the nec-
essary expertise can provide care for a seriously ill
patient, including a woman battling cancer, should
be appealable to an independent, impartial body, and
that this same right should be available to all Ameri-
cans in need of access to high quality specialty care.
SEC. 705. SENSE OF THE SENATE REGARDING FAIR REVIEW
PROCESS.
(a) FINDINGS.—The Senate finds the following:
(1) A fair, timely, impartial independent exter-
nal appeals process is essential to any meaningful
program of patient protection.
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(2) The independence and objectivity of the re-
view organization and review process must be en-
sured.
(3) It is incompatible with a fair and inde-
pendent appeals process to allow a health mainte-
nance organization to select the review organization
that is entrusted with providing a neutral and unbi-
ased medical review.
(4) The American Arbitration Association and
arbitration standards adopted under chapter 44 of
title 28, United States Code (28 U.S.C. 651 et seq.)
both prohibit, as inherently unfair, the right of one
party to a dispute to choose the judge in that dis-
pute.
(b) SENSE OF THE SENATE.—It is the sense of the
Senate that—
(1) every patient who is denied care by a health
maintenance organization or other health insurance
company should be entitled to a fair, speedy, impar-
tial appeal to a review organization that has not
been selected by the health plan;
(2) the States should be empowered to maintain
and develop the appropriate process for selection of
the independent external review entity;
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(3) a child battling a rare cancer whose health
maintenance organization has denied a covered
treatment recommended by its physician should be
entitled to a fair and impartial external appeal to a
review organization that has not been chosen by the
organization or plan that has denied the care; and
(4) patient protection legislation should not pre-
empt existing State laws in States where there al-
ready are strong laws in place regarding the selec-
tion of independent review organizations.
SEC. 706. ANNUAL REVIEW.
(a) IN GENERAL.—Not later than 24 months after
the general effective date referred to in section 601(a)(1),
and annually thereafter for each of the succeeding 4 cal-
endar years (or until a repeal is effective under subsection
(b)), the Secretary of Health and Human Services shall
request that the Institute of Medicine of the National
Academy of Sciences prepare and submit to the appro-
priate committees of Congress a report concerning the im-
pact of this Act, and the amendments made by this Act,
on the number of individuals in the United States with
health insurance coverage.
(b) LIMITATION
WITH
RESPECT
TO
CERTAIN
PLANS.—If the Secretary, in any report submitted under
subsection (a), determines that more than 1,000,000 indi-
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viduals in the United States have lost their health insur-
ance coverage as a result of the enactment of this Act,
as compared to the number of individuals with health in-
surance coverage in the 12-month period preceding the
date of the enactment of this Act, section 402 of this Act
shall be repealed effective on the date that is 12 month
after the date on which the report is submitted, and the
submission of any further reports under subsection (a)
shall not be required.
(c) FUNDING.—From funds appropriated to the De-
partment of Health and Human Services for fiscal years
2003 and 2004, the Secretary of Health and Human Serv-
ices shall provide for such funding as the Secretary deter-
mines necessary for the conduct of the study of the Na-
tional Academy of Sciences under this section.
SEC. 707. DEFINITION OF BORN-ALIVE INFANT.
(a) IN GENERAL.—Chapter 1 of title 1, United
States Code, is amended by adding at the end the fol-
lowing:
‘‘§ 8. ‘Person’, ‘human being’, ‘child’, and ‘individual’
as including born-alive infant
‘‘(a) In determining the meaning of any Act of Con-
gress, or of any ruling, regulation, or interpretation of the
various administrative bureaus and agencies of the United
States, the words ‘person’, ‘human being’, ‘child’, and ‘in-
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dividual’, shall include every infant member of the species
homo sapiens who is born alive at any stage of develop-
ment.
‘‘(b) As used in this section, the term ‘born alive’,
with respect to a member of the species homo sapiens,
means the complete expulsion or extraction from his or
her mother of that member, at any stage of development,
who after such expulsion or extraction breathes or has a
beating heart, pulsation of the umbilical cord, or definite
movement of voluntary muscles, regardless of whether the
umbilical cord has been cut, and regardless of whether the
expulsion or extraction occurs as a result of natural or
induced labor, caesarean section, or induced abortion.
‘‘(c) Nothing in this section shall be construed to af-
firm, deny, expand, or contract any legal status or legal
right applicable to any member of the species homo sapi-
ens at any point prior to being born alive as defined in
this section.’’.
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(b) CLERICAL AMENDMENT.—The table of sections
at the beginning of chapter 1 of title 1, United States
Code, is amended by adding at the end the following new
item:
‘‘8. ‘Person’, ‘human being’, ‘child’, and ‘individual’ as including born-alive in-
fant.’’.
Passed the House of Representatives August 2,
2001.
Attest:
JEFF TRANDAHL,
Clerk.
Calendar No. 150
107TH CONGRESS
1ST SESSION
H. R. 2563
AN ACT
To amend the Public Health Service Act, the Em-
ployee Retirement Income Security Act of 1974,
and the Internal Revenue Code of 1986 to pro-
tect consumers in managed care plans and other
health coverage.
SEPTEMBER 5, 2001
Received and read the first time
SEPTEMBER 6, 2001
Read the second time and placed on the calendar