TITLE I—HEALTH SECURITY FOR ALL AMERICANS—EXPANSION
PHASE (PHASE I)
Sec. 101. Expansion phase (phase I) voluntary State universal health insurance
coverage plans.
‘‘TITLE XXII—HEALTH SECURITY FOR ALL AMERICANS
‘‘PART A—EXPANSION PHASE (PHASE I) PLANS
‘‘Sec. 2201. Purpose; voluntary State plans.
‘‘Sec. 2202. Plan requirements.
‘‘Sec. 2203. Coverage requirements for expansion phase (phase I) plans.
‘‘Sec. 2204. Allotments.
‘‘Sec. 2205. Administration.
‘‘Sec. 2206. Definitions.’’.
TITLE II—HEALTH SECURITY FOR ALL AMERICANS—UNIVERSAL
PHASE (PHASE II)
Sec. 201. Universal phase (phase II) State universal health insurance coverage
plans.
‘‘PART B—UNIVERSAL PHASE (PHASE II) PLANS
‘‘Sec. 2211. Purpose; mandatory State plans.
‘‘Sec. 2212. Plan requirements.
‘‘Sec. 2213. Coverage requirements for universal phase (phase II) plans.
‘‘Sec. 2214. Requirements for employers regarding the provision of bene-
fits.
‘‘Sec. 2215. Allotments.
‘‘Sec. 2216. Administration; definitions.
Sec. 202. Consumer protections.
‘‘PART C—CONSUMER PROTECTIONS
‘‘Sec. 2221. Home care standards.
‘‘Sec. 2222. Consumer protection in the event of termination or suspension
of services.
‘‘Sec. 2223. Consumer protection through disclosure of information.
‘‘Sec. 2224. Consumer protection through notice of changes in health care
delivery.
TITLE III—PATIENT PROTECTIONS
Sec. 301. Incorporation of certain protections.
TITLE IV—HEALTH CARE QUALITY, PATIENT SAFETY, AND
WORKFORCE STANDARDS
Sec. 401. Health Care Quality, Patient Safety, and Workforce Standards Insti-
tute.
Sec. 402. Health Care Quality, Patient Safety, and Workforce Standards Advi-
sory Committee.
TITLE V—IMPROVING MEDICARE BENEFITS
Sec. 501. Full mental health and substance abuse treatment benefits parity.
TITLE VI—LONG-TERM AND HOME HEALTH CARE
Sec. 601. Studies and demonstration projects to identify model programs.
TITLE VII—MISCELLANEOUS
Sec. 701. Nonapplication of ERISA.
Sec. 702. Sense of Congress regarding offsets.
SEC. 2. FINDINGS.
Congress makes the following findings:
(1) The health of the American people is the
foundation of American strength, productivity, and
wealth.
(2) The guarantee of health care coverage and
access to quality medical care to all Americans is a
fundamental right and is essential to the general
welfare.
(3) 
38,700,000 
Americans, 
more 
than
8,500,000 of whom are children, have no health in-
surance, and that number will grow to more than
54,000,000 by 2007 even if the economy remains
strong.
(4) Health insurance coverage is unstable; less
than 1⁄2 of all adults have been in their current
health plan for 3 years.
(5) The average American will hold at least 7
jobs during their life, risking lack of health coverage
every time they change or are between jobs.
(6) In 1998, annual health care expenditures in
the United States totaled $1,150,000,000,000, or
$4,094 per person. National health expenditures are
projected to total $2,200,000,000,000 by 2008.
(7) In 1998, health care expenditures rep-
resented 13.5 percent of the gross domestic product
in the United States and grew at the rate of 5.6 per-
cent while the gross domestic product grew only at
the rate of 4.9 percent. By 2008, health care ex-
penditures are projected to reach 16.2 percent of
gross domestic product. Growth in health spending
is projected to average 1.8 percentage points above
the growth rate of the gross domestic product for
the period beginning with 1998 and ending with
2008.
(8) Although the United States spends consid-
erably more in health care per person than any other
nation, it ranks only fifteenth among countries
worldwide on an overall index designed to measure
a range of health goals according to the World
Health Organization.
(9) One of 4 adults, about 40,000,000 people,
say they have gone without needed medical care be-
cause they couldn’t afford it.
(10) Nearly 31,000,000 Americans face collec-
tion agencies annually because they owe money for
medical bills.
(11) The average American worker is paying 3
times more for family coverage than 10 years ago,
and more than 4 times more for employee-only cov-
erage.
(12) Because many individuals do not have
health insurance coverage, they may incur health
care costs which they do not fully reimburse, result-
ing in cost-shifting to others.
(13) As a consequence of the piecemeal health
care system in the United States, administrative
overhead costs approximately $1,000 per person an-
nually, while other Western industrialized nations
with universal health care systems spend approxi-
mately $200 per person annually for administrative
overhead.
(14) The United States should adopt national
goals of universal, affordable, comprehensive health
insurance coverage and should provide generous
matching grants to the States to achieve those goals
within 5 years of the date of enactment of this Act.
TITLE I—HEALTH SECURITY FOR
ALL AMERICANS—EXPANSION
PHASE (PHASE I)
SEC. 101. EXPANSION PHASE (PHASE I) VOLUNTARY STATE
UNIVERSAL HEALTH INSURANCE COVERAGE
PLANS.
The Social Security Act (42 U.S.C. 301 et seq.) is
amended by adding at the end the following:
‘‘TITLE XXII—HEALTH SECURITY
FOR ALL AMERICANS
‘‘PART A—EXPANSION PHASE (PHASE I) PLANS
‘‘SEC. 2201. PURPOSE; VOLUNTARY STATE PLANS.
‘‘(a) PURPOSE.—The purpose of this part is to pro-
vide funds to participating States to enable those States
to ensure universal health insurance coverage by estab-
lishing State administered systems targeted to State resi-
dents with a family income that does not exceed 300 per-
cent of the poverty line.
‘‘(b) EXPANSION
PHASE
(PHASE
I) PLAN
RE-
QUIRED.—A State is not eligible for a payment under sec-
tion 2205(a) unless the State has submitted to the Sec-
retary a plan that—
‘‘(1) sets forth how the State intends to use the
funds provided under this part to ensure universal,
affordable, and comprehensive health insurance cov-
erage to eligible residents of the State consistent
with the provisions of this part; and
‘‘(2) has been approved under section 2202(d).
‘‘SEC. 2202. PLAN REQUIREMENTS.
‘‘(a) IN GENERAL.—Every expansion phase (phase I)
plan shall include provisions for the following:
‘‘(1) INFORMATION ON THE LEVEL OF HEALTH
INSURANCE COVERAGE.—
‘‘(A) The level of health insurance coverage
within the State as determined under sub-
section (b).
‘‘(B) The base coverage gap for the year
involved as determined under subsection (b)(4).
‘‘(C) State efforts to provide or obtain
health insurance coverage for uncovered resi-
dents of the State, including the steps the State
is taking to identify and enroll all uncovered
residents of the State who are eligible to par-
ticipate in public or private health insurance
programs.
‘‘(2) DETAILS OF, AND TIMELINES FOR, EXPAN-
SION PHASE (PHASE I) PLAN.—
‘‘(A) USE
OF
FUNDS; COORDINATION.—
The activities that the State intends to carry
out using funds received under this part, in-
cluding how the State will coordinate efforts
under this part with existing State efforts to in-
crease the health insurance coverage of individ-
uals.
‘‘(B) TIMELINES.—Consistent with sub-
section (c), the manner in which the State will
reduce the base coverage gap for the year in-
volved, including a timetable with specified tar-
gets for reducing the base coverage gap by—
‘‘(i) 50 percent within 2 years after
the date of approval of the expansion
phase (phase I) plan; and
‘‘(ii) 100 percent within 4 years after
such date.
‘‘(3) MAINTENANCE OF EFFORT.—The manner
in which the State will ensure that—
‘‘(A) employers within the State will con-
tinue to provide not less than the level of finan-
cial support toward the health insurance pre-
miums required for coverage of their employees
as such employers provided as of the date of en-
actment of this title; and
‘‘(B) the State will continue to provide not
less than the level of State expenditures in-
curred for State-funded health programs as of
such date.
For purposes of this paragraph, any population or
service that was covered under the medicaid pro-
gram under title XIX under a waiver under section
1115 or section 1902(r)(2) shall be treated as if
such State expenditures had been based on the en-
hanced FMAP formula used under the State chil-
dren’s health insurance program under title XXI.
‘‘(4) STATE OUTREACH PROGRAMS; ACCESS.—
The manner in which, and a timetable for when, the
State will—
‘‘(A) institute outreach programs; and
‘‘(B) ensure that all eligible residents of
the State have access to the health insurance
coverage provided under this part.
‘‘(5) ASSURANCE OF COVERAGE OF ESSENTIAL
SERVICES.—An assurance that the State program
established under this part will comply with the re-
quirements of section 1867 (commonly referred to as
the ‘Emergency Medical Treatment and Active
Labor Act’).
‘‘(6) REPRESENTATION ON BOARDS AND COM-
MISSIONS.—The manner in which the State will en-
sure that all Boards and Commissions that the State
establishes to administer the plan will include,
among others, representatives of providers, con-
sumers, employers, and health worker unions.
‘‘(7) DISCLOSURE
OF
INFORMATION
TO
THE
PUBLIC.—The manner in which the State will ensure
that, with respect to entities and individuals that
provide services for which reimbursement is provided
under this part—
‘‘(A) financial arrangements between in-
surers and providers and between providers and
medical equipment suppliers are disclosed to the
public; and
‘‘(B) ownership interests and health care
worker qualifications and credentials are dis-
closed to the public.
‘‘(8) CONSUMER
PROTECTIONS.—The manner
in which the State will ensure compliance with sec-
tions 2221, 2222, 2223, and 2224.
‘‘(9) PUBLIC REVIEW.—The manner in which
the State will provide for the public review of insti-
tutional changes in services provided, markets and
regions covered, withdrawal or movement of services,
closures or downsizing, and other actions that affect
the provision of health insurance under the plan.
‘‘(10) SERVICES IN RURAL AND UNDERSERVED
AREAS; CULTURAL
COMPETENCY.—The manner in
which the State will ensure—
‘‘(A) coverage in rural and underserved
areas; and
‘‘(B) that the needs of culturally diverse
populations are met.
‘‘(11) MECHANISMS
TO
MINIMIZE
ADVERSE
RISK SELECTION.—The manner in which the State
will encourage mechanisms to minimize adverse risk
selection that provide choice of health plans and con-
trol costs.
‘‘(12) LIMITATION
ON
ADMINISTRATIVE
EX-
PENDITURES.—The manner in which the State will
ensure that all qualified plans in the State expend
at least 90 percent (or, during the first 2 years of
the plan, 85 percent) of total income received from
premiums on the provision of covered health care
benefits (excluding all costs for marketing, adver-
tising, health plan administration, profits, or capital
accumulation) to individuals.
‘‘(13) 
SELF-EMPLOYED
AND
MULTI-
EMPLOYED.—The manner in which the State will
address self-employed individuals and multiwage
earner families.
‘‘(14) REQUIREMENT TO MAINTAIN MEDICAID
BENEFITS.—The manner in which the State will en-
sure that individuals who are eligible for medical as-
sistance under title XIX and who receive benefits
under the expansion phase (phase I) plan shall re-
ceive any items or services that are not available
under the expansion phase (phase I) plan but that
are available under the State medicaid program
under title XIX through ‘wraparound coverage’
under such program.
‘‘(15) COST CONTAINMENT; RISK SELECTION.—
What cost containment strategies the State will em-
ploy and how the State will reduce adverse risk se-
lection.
‘‘(16) OTHER MATTERS.—Any other matter de-
termined appropriate by the Secretary.
‘‘(b) CURRENT LEVEL OF COVERAGE.—
‘‘(1) IN GENERAL.—The Secretary shall develop
a standardized survey approach that provides timely
and up-to-date data to determine the percentage of
the population of each State that is currently cov-
ered by a health insurance plan or program that
provides coverage that meets the requirements of
section 2203(a).
‘‘(2) BIANNUAL SURVEY.—The Secretary shall
provide for the conduct of the survey developed
under paragraph (1) not less than biannually to
make coverage determinations for purposes of para-
graph (1).
‘‘(3) USE OF ALTERNATIVE SYSTEM.—The Sec-
retary shall permit a State to utilize an alternative
population-based monitoring system to make deter-
minations with respect to coverage in the State for
purposes of paragraph (1) if the Secretary deter-
mines that such system meets or exceeds the meth-
odological standards utilized in the survey developed
under paragraph (1).
‘‘(4) BASE COVERAGE GAP.—For purposes of
subsection (a)(1)(A), the base coverage gap for a
State shall be equal to 100 percent of the eligible in-
dividuals and families in the State for the year in-
volved, less the current level of coverage for those in-
dividuals and families for such year as determined
under paragraph (1) or (3).
‘‘(c) REDUCING THE LEVEL OF UNINSURED INDIVID-
UALS.—
‘‘(1) IN GENERAL.—To be eligible to receive
funds under this part, a State shall agree to admin-
ister an expansion phase (phase I) plan with a goal
of providing health insurance coverage for 100 per-
cent of the eligible residents of the State by not later
than 4 years after the date of approval of the State’s
expansion phase (phase I) plan.
‘‘(2) PERMISSIBLE ACTIVITIES.—A State may
use amounts provided under this part for any activi-
ties consistent with this part that are appropriate to
enroll individuals in health plans and health pro-
grams to meet the targets contained in the State
plan under subsection (a)(2)(B), including through
the use of direct payments to health plans or, in the
case of a single State plan, directly to providers of
services.
‘‘(d) PROCESS
FOR SUBMISSION, APPROVAL, AND
AMENDMENT OF EXPANSION PHASE (PHASE I) PLAN.—
The provisions of section 2106 apply to an expansion
phase (phase I) plan under this part in the same manner
as they apply to a State plan under title XXI, except that
no expansion phase (phase I) plan may be effective earlier
than January 1, 2003, and all expansion phase (phase I)
plans must be submitted for approval by not later than
December 31, 2004.
‘‘SEC. 2203. COVERAGE REQUIREMENTS FOR EXPANSION
PHASE (PHASE I) PLANS.
‘‘(a) REQUIRED SCOPE OF HEALTH INSURANCE COV-
ERAGE.—Health insurance coverage provided under this
part shall consist of at least the benefits provided under
the Federal Employees Health Benefits Program standard
Blue Cross/Blue Shield preferred provider option service
benefit plan, described in and offered under section
8903(1) of part 5, United States Code, plus mental health
and substance abuse treatment benefits parity for all indi-
viduals, and benefits for early and periodic screening and
diagnosis services (EPSDT) under section 1905(a)(4)(B)
for all individuals under 21 years of age.
‘‘(b) LIMITATIONS ON PREMIUMS AND COST-SHAR-
ING.—
‘‘(1) DESCRIPTION; GENERAL CONDITIONS.—An
expansion phase (phase I) plan shall include a de-
scription, consistent with this subsection, of the
amount (if any) of premiums, cost-sharing, or other
similar charges imposed. Any such charges shall be
imposed pursuant to a public schedule.
‘‘(2) LIMITATIONS
ON
PREMIUMS
AND
COST-
SHARING.—
‘‘(A) INDIVIDUALS AND FAMILIES WITH IN-
COME
BELOW
150
PERCENT
OF
POVERTY
LINE.—In the case of an individual or family
whose income is at or below 150 percent of the
poverty line—
‘‘(i) the State plan may not impose a
premium; and
‘‘(ii) 
the 
total 
annual 
aggregate
amount of cost-sharing imposed by a State
with respect to all individuals in a family
may not exceed 0.5 percent of the family’s
income for the year involved.
‘‘(B) INDIVIDUALS
AND
FAMILIES
WITH
INCOME BETWEEN 150 AND 300 PERCENT OF
POVERTY LINE.—In the case of an individual or
family whose income exceeds 150 percent but
does not exceed 300 percent of the poverty
line—
‘‘(i) the State plan may not impose a
premium that exceeds an amount that is
equal to—
‘‘(I) 20 percent of the average
cost of providing benefits to an indi-
vidual (or a family) under this part in
the year involved; or
‘‘(II) 3 percent of the family’s in-
come for the year involved; and
‘‘(ii) 
the 
total 
annual 
aggregate
amount of premiums and cost-sharing
(combined) imposed by a State with re-
spect to all individuals in a family may not
exceed 5 percent of the family’s income for
the year involved.
‘‘(C) INDIVIDUALS AND FAMILIES WITH IN-
COME
ABOVE
300
PERCENT
OF
POVERTY
LINE.—In the case of an individual or family
whose income exceeds 300 percent of the pov-
erty line—
‘‘(i) the State plan may not impose a
premium that exceeds 20 percent of the
average cost of providing benefits to an in-
dividual (or a family of the size involved)
under this part in the year involved; and
‘‘(ii) 
the 
total 
annual 
aggregate
amount of premiums and cost-sharing
(combined) imposed by a State with re-
spect to all individuals in a family may not
exceed 7 percent of the family’s income for
the year involved.
‘‘(D) SELF-EMPLOYED INDIVIDUALS.—The
State shall establish rules for self-employed in-
dividuals based on individual and family in-
come.
‘‘(3) COLLECTION.—The State shall establish
procedures for collecting any premiums, cost-shar-
ing, or other similar charges imposed under this
part. Such procedures shall provide for annual rec-
onciliations and adjustments.
‘‘(c) APPLICATION OF CERTAIN REQUIREMENTS.—
‘‘(1) RESTRICTION ON APPLICATION OF PRE-
EXISTING CONDITION EXCLUSIONS.—The expansion
phase (phase I) plan shall not permit the imposition
of any preexisting condition exclusion for covered
benefits under the plan.
‘‘(2) CHOICE OF PLANS.—
‘‘(A) IN GENERAL.—Except as provided in
subparagraph (B), the expansion phase (phase
I) plan shall offer eligible individuals and fami-
lies a choice of qualified plans from which to re-
ceive benefits under this part. At least 1 plan
shall be a preferred provider option plan.
‘‘(B) WAIVER.—The Secretary—
‘‘(i) may waive the requirement under
subparagraph (A) if determined appro-
priate; and
‘‘(ii) shall waive such requirement in
the case of a State that establishes a single
State plan.
‘‘SEC. 2204. ALLOTMENTS.
‘‘(a) STATE ALLOTMENTS.—
‘‘(1) IN
GENERAL.—With respect to a fiscal
year, the Secretary shall allot to each State with an
expansion phase (phase I) plan approved under this
part the amount determined under paragraph (2) for
such State for such fiscal year.
‘‘(2) DETERMINATION
OF
COST
OF
COV-
ERAGE.—The amount determined under this para-
graph is the amount equal to—
‘‘(A) the product of—
‘‘(i) the Federal participation rate for
the State as determined under subsection
(b) or, if applicable, the enhanced Federal
participation rate for the State, as deter-
mined under subsection (c);
‘‘(ii) the estimated cost for the min-
imum benefits package required to comply
under section 2203, not to exceed the sum
of—
‘‘(I) the total annual Government
and employee contributions required
for individual or self and family health
benefits coverage under the Federal
Employees Health Benefits Program
standard Blue Cross/Blue Shield pre-
ferred provider option service benefit
plan, described in and offered under
section 8903(1) of title 5, United
States Code (adjusted for age and
other factors, as the Secretary deter-
mines appropriate); and
‘‘(II) the estimated average cost-
sharing expense for an individual or
family; and
‘‘(iii) the estimated number of resi-
dents to be enrolled in the expansion phase
(phase I) plan; less
‘‘(B) the sum of—
‘‘(i) the individual or family health in-
surance contribution and cost-sharing pay-
ments to be made in accordance with sec-
tion 2203(b); and
‘‘(ii) any applicable employer contribu-
tion to such payments.
‘‘(b) FEDERAL PARTICIPATION RATE.—For purposes
of subsection (a)(2)(A)(i), the Federal participation rate
for a State shall be equal to the enhanced FMAP deter-
mined for the State under section 2105(b).
‘‘(c) ENHANCED FEDERAL PARTICIPATION RATE.—
‘‘(1) IN GENERAL.—For purposes of subsection
(a)(2)(A)(i), the enhanced Federal participation rate
for a State shall be equal to the Federal participa-
tion rate for such State under subsection (b), as ad-
justed by the Secretary based on the decrease in the
base coverage gap in the State.
‘‘(2) AMOUNT OF ADJUSTMENT AND APPLICA-
TION.—
‘‘(A) AMOUNT
OF
ADJUSTMENT.—The
Federal participation rate under subsection (b)
with respect to a State shall be increased by—
‘‘(i) 1 percentage point if the base
coverage gap of the State has decreased by
at least 50 percent within 2 years after the
date of approval of the expansion phase
(phase I) plan, as determined by the Sec-
retary; and
‘‘(ii) 3 percentage points if the base
coverage gap of the State has decreased by
100 percent within 4 years after the date
of approval of the expansion phase (phase
I) plan, as determined by the Secretary.
‘‘(B) APPLICATION.—The increase de-
scribed in—
‘‘(i) subparagraph (A)(i) shall only
apply to a State for the period beginning
with the month of the determination under
such subparagraph and ending with the
month preceding the month of the deter-
mination under subparagraph (A)(ii) (if
any), but in no event for more than 24
months; and
‘‘(ii) subparagraph (A)(ii) shall apply
to a State for any year (or portion thereof)
beginning with the month of the deter-
mination under such subparagraph.
‘‘(3) FULL COVERAGE.—For purposes of this
part, a State shall be deemed to have decreased its
base coverage gap by 100 percent if the Secretary
determines that—
‘‘(A) 98 percent of all eligible residents of
the State are provided health insurance cov-
erage under the expansion phase (phase I) plan;
and
‘‘(B) the remaining 2 percent of such resi-
dents are served by alternative health care de-
livery systems as demonstrated by the State.
‘‘(d) GRANTS TO INDIAN TRIBES, NATIVE HAWAIIAN
ORGANIZATIONS, 
AND
ALASKA
NATIVE
ORGANIZA-
TIONS.—
‘‘(1) IN GENERAL.—Out of funds appropriated
under subsection (e), the Secretary shall reserve an
amount, not to exceed 1 percent of the total allot-
ments determined under subsection (a) for a fiscal
year, to make grants to Indian tribes, Native Hawai-
ian organizations, and Alaska Native organizations
for development and implementation of universal
health insurance coverage plans for members of such
tribes and organizations.
‘‘(2) PLAN.—To be eligible to receive a grant
under paragraph (1), an Indian tribe, Native Hawai-
ian organization, or Alaska Native organization shall
submit a universal health insurance coverage plan to
the Secretary at such time, in such manner, and
containing such information, as the Secretary may
require.
‘‘(3) REGULATIONS.—The Secretary shall issue
regulations specifying the requirements of this part
that apply to Indian tribes, Native Hawaiian organi-
zations, and Alaska Native organizations receiving
grants under paragraph (1).
‘‘(e) APPROPRIATION.—
‘‘(1) IN GENERAL.—Out of any funds in the
Treasury not otherwise appropriated, there is appro-
priated to carry out this title such sums as may be
necessary for fiscal year 2003 and each fiscal year
thereafter.
‘‘(2) BUDGET AUTHORITY.—Paragraph (1) con-
stitutes budget authority in advance of appropria-
tions Acts and represents the obligation of the Fed-
eral Government to provide States, Indian tribes,
Native Hawaiian organizations, and Alaska Native
organizations with the allotments determined under
this section and the grants for administrative and
outreach activities under section 2205.
‘‘SEC. 2205. ADMINISTRATION.
‘‘(a) PAYMENTS.—
‘‘(1) IN GENERAL.—
‘‘(A) QUARTERLY.—Subject to subpara-
graph (B) and subsection (b), the Secretary
shall make quarterly payments to each State
with an expansion phase (phase I) plan ap-
proved under this part, from its allotment
under section 2204.
‘‘(B) FUNDING FOR ADMINISTRATION AND
OUTREACH.—
‘‘(i) AUTHORITY TO MAKE GRANTS.—
In addition to the allotments determined
under section 2204, the Secretary may
make grants to States, Indian tribes, Na-
tive Hawaiian organizations, and Alaska
Native organizations for expenditures for
administrative and outreach activities.
‘‘(ii) AMOUNTS.—
‘‘(I) 
IN
GENERAL.—A 
grant
awarded under this subparagraph
shall not exceed the applicable per-
centage (as determined under sub-
clause (II)) of the total amount allot-
ted to the State, Indian tribe, Native
Hawaiian organization, or Alaska Na-
tive organization under section 2204.
‘‘(II) 
APPLICABLE
PERCENT-
AGE.—For purposes of subclause (I),
the applicable percentage is—
‘‘(aa) 10 percent for 2004
through 2008; and
‘‘(bb) 3 percent for 2009
and each year thereafter.
‘‘(2) ADVANCE PAYMENT; RETROSPECTIVE AD-
JUSTMENT.—The Secretary may make payments
under this part for each quarter on the basis of ad-
vance estimates by the State and such other inves-
tigation as the Secretary may find necessary, and
may reduce or increase the payments as necessary to
adjust for any overpayment or underpayment for
prior quarters.
‘‘(3) FLEXIBILITY IN SUBMITTAL OF CLAIMS.—
Nothing in this subsection shall be construed as pre-
venting a State from claiming as expenditures in the
quarter expenditures that were incurred in a pre-
vious quarter.
‘‘(b) AUTHORITY FOR BLENDED RATE FOR HEALTH
SECURITY, MEDICAID, AND SCHIP FUNDS.—The Sec-
retary shall establish procedures for blending the pay-
ments that a State is entitled to receive under this title,
title XIX, and title XXI into 1 payment rate if—
‘‘(1) the State requests such a blended pay-
ment; and
‘‘(2) the Secretary finds that the State meets
maintenance of effort requirements established by
the Secretary.
‘‘(c) LIMITATIONS ON FEDERAL PAYMENTS BASED
ON COST CONTAINMENT.—
‘‘(1) DETERMINATION
OF
BASELINE.—Each
year (beginning with 2003), the Secretary shall es-
tablish a baseline projection for the national rate of
growth in private health insurance premiums for
such year.
‘‘(2) REQUIREMENT.—Beginning with fiscal
year 2004 and each fiscal year thereafter, any pay-
ment made to a State under section 2204 shall not
exceed the amount paid to the State under such sec-
tion for the preceding fiscal year, adjusted for
changes in enrollment and a premium inflation ad-
justment that is 0.5 percent below the baseline pro-
jection determined under paragraph (1) for the year,
unless the State adopts (and the Secretary approves)
cost containment strategy that will reduce the rate
of growth of spending.
‘‘(d) OTHER LIMITATIONS ON USE OF FUNDS.—
‘‘(1) IN GENERAL.—A State participating under
part A, and, effective January 1, 2007, all States
under part B, shall ensure that any payments re-
ceived by the State under section 2205 or 2116(a)
are not used by any individual or entity, including
providers or health plans that contract to provide
services herein, to finance directly or indirectly, or to
otherwise facilitate expenditures to influence health
care workers of such individual or entity with re-
spect to issues related to unionization.
‘‘(2) CONSTRUCTION.—Nothing in this sub-
section shall be construed to limit expenditures made
for the purpose of good faith collective bargaining or
pursuant to the terms of a bona fide collective bar-
gaining agreement.
‘‘(e) WAIVER
OF
FEDERAL
REQUIREMENTS.—A
State may request (and the Secretary may grant) a waiver
of any provision of Federal law that the State determines
is necessary in order to carry out an approved expansion
phase (phase I) plan under this part.
‘‘(f) REPORT.—Not later than January 1, 2004, and
each January 1 thereafter, the Secretary, in consultation
with the General Accounting Office and the Congressional
Budget Office, shall prepare and submit to the appro-
priate committees of Congress a report on the number of
States receiving payments under this part for the year for
which the report is being prepared as well as the level of
insurance coverage attained by each such State.
‘‘SEC. 2206. DEFINITIONS.
‘‘In this title:
‘‘(1) COST-SHARING.—The term ‘cost-sharing’
has the meaning given such term under the Federal
Employees Health Benefits Program standard Blue
Cross/Blue Shield preferred provider option service
benefit plan described in and offered under section
8903(1) of part 5, United States Code, and includes
deductibles, copayments, coinsurance, as such terms
are defined for purposes of such plan.
‘‘(2) ELIGIBLE RESIDENTS OF A STATE.—
‘‘(A) IN
GENERAL.—The term ‘eligible
residents of a State’ means an individual or
family who—
‘‘(i) is (or consists of) a resident of
the State involved;
‘‘(ii) except as provided in subpara-
graph (B), has a family income that does
not exceed 300 percent of the poverty line;
‘‘(iii) is (or consists of) a citizen of
the United States, a legal resident alien, or
an individual otherwise residing in the
United States under the authority of Fed-
eral law; and
‘‘(iv) in the case of an individual, is
not eligible for benefits under the medicare
program under title XVIII or for medical
assistance under the medicaid program
under title XIX (other than under the ap-
plication 
of 
section
1902(a)(10)(A)(ii)(XIV)).
‘‘(B) OPTION TO PROVIDE COVERAGE FOR
INDIVIDUALS AND FAMILIES WITH HIGHER IN-
COME.—If approved by the Secretary, a State
may increase the percentage described in sub-
paragraph (A)(ii), or eliminate all income eligi-
bility criteria in order to provide coverage under
this part to more individuals and families.
‘‘(3) EXPANSION PHASE (PHASE I) PLAN.—The
term ‘expansion phase (phase I) plan’ means the
State universal health insurance coverage plan sub-
mitted under section 2201(b).
‘‘(4) HEALTH
CARE
SERVICES.—The term
‘health care services’ includes medical, surgical,
mental health, and substance abuse services, wheth-
er provided on an inpatient or outpatient basis.
‘‘(5) 
HEALTH
CARE
WORKER.—The 
term
‘health care worker’ means an individual employed
by an employer that provides—
‘‘(A) health care services; or
‘‘(B) necessary related services, including
administrative, food service, janitorial, or main-
tenance service to an entity that provides such
health care services.
‘‘(6) HEALTH PLAN.—The term ‘health plan’
includes health insurance coverage, as defined in sec-
tion 2791(b)(1) of the Public Health Service Act (42
U.S.C. 300gg–91(b)(1)) and group health plans, as
defined in section 2791(a) of such Act (42 U.S.C.
300gg91(b)(1)).
‘‘(7) MENTAL HEALTH AND SUBSTANCE ABUSE
TREATMENT BENEFITS PARITY.—
‘‘(A) IN
GENERAL.—The term ‘mental
health and substance abuse treatment benefits
parity’ means, with respect to health coverage,
that the coverage does not impose treatment
limitations or financial requirements on the cov-
erage of mental health benefits if similar re-
quirements are not imposed on coverage of
medical and surgical benefits in comparable set-
tings (including inpatient and outpatient set-
tings).
‘‘(B) 
TREATMENT
LIMITATIONS.—The
term ‘treatment limitations’ means limits on the
frequency of treatment, number of visits, or
other limits on the scope and duration of treat-
ment, as covered by a group health plan (or
health insurance coverage offered in connection
with such a plan). Such term does not include
limits on benefits or coverage based solely on
medical necessity.
‘‘(C) 
FINANCIAL
REQUIREMENTS.—The
term ‘financial requirements’ means copay-
ments, deductibles, out-of-network charges, out-
of-pocket contributions or fees, annual limits,
and lifetime aggregate limits imposed on cov-
ered individuals.
‘‘(8) POVERTY LINE.—The term ‘poverty line’
has the meaning given such term in section 673(2)
of the Community Services Block Grant Act (42
U.S.C. 9902(2)), including any revision required by
such section.
‘‘(9) PREMIUM.—The term ‘premium’ includes
any enrollment fees and other similar charges.
‘‘(10) QUALIFIED PLAN.—The term ‘qualified
plan’ means a health plan that satisfies the coverage
requirements described under section 2203 and par-
ticipates in an expansion phase (phase I) plan.’’.
TITLE 
II—HEALTH 
SECURITY
FOR 
ALL 
AMERICANS—UNI-
VERSAL PHASE (PHASE II)
SEC. 201. UNIVERSAL PHASE (PHASE II) STATE UNIVERSAL
HEALTH INSURANCE COVERAGE PLANS.
Title XXII of the Social Security Act, as added by
section 101, is amended by adding at the end the fol-
lowing:
‘‘PART B—UNIVERSAL PHASE (PHASE II) PLANS
‘‘SEC. 2211. PURPOSE; MANDATORY STATE PLANS.
‘‘(a) PURPOSE.—The purposes of this part are to—
‘‘(1) require States to establish and implement
State-administered systems to ensure universal
health insurance coverage; and
‘‘(2) provide funds to States for the establish-
ment and implementation of such systems.
‘‘(b) UNIVERSAL PHASE (PHASE II) PLAN RE-
QUIRED.—
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), not later than January 1, 2006, a State
shall submit to the Secretary a plan that sets forth
how the State intends to use the funds provided
under this part to ensure universal, affordable, and
comprehensive health insurance coverage to eligible
residents of the State consistent with the provisions
of this part.
‘‘(2) STATES WITH PHASE I PLANS.—
‘‘(A) IN GENERAL.—Not later than Janu-
ary 1, 2006, a State with a phase I State plan
shall submit an addendum to such plan that
provides assurances to the Secretary that such
plan conforms to the requirements of this part.
‘‘(B) CONVERSION TO UNIVERSAL PHASE
(PHASE II) PLAN.—If an addendum to an ex-
pansion phase (phase I) plan is approved by the
Secretary—
‘‘(i) the plan shall be automatically
converted to a universal phase (phase II)
plan; and
‘‘(ii) section 2214 and any provision
of part A that is inconsistent with this
part shall not apply to the plan.
‘‘(3) FAILURE
TO
SUBMIT
PLAN
OR
ADDEN-
DUM.—If a State fails to submit a plan as required
in paragraph (1) (or an addendum as required in
paragraph (2)), or fails to have such plan or adden-
dum approved by the Secretary, such State shall be
in violation of this part; and any residents of such
a State may bring a cause of action against the
State in Federal district court to require the State
to comply with the provisions of this part.
‘‘SEC. 2212. PLAN REQUIREMENTS.
‘‘(a) IN GENERAL.—A universal phase (phase II)
plan shall include a description, consistent with the re-
quirements of this part, of the following:
‘‘(1) DETAILS
OF
THE
UNIVERSAL
PHASE
(PHASE II) PLAN.—The activities that the State in-
tends to carry out using funds received under this
part to ensure that all eligible residents of the State
have access to the coverage provided under this part,
including how the State will coordinate efforts under
the program under this part with existing State ef-
forts to increase to 100 percent the health insurance
coverage of eligible residents of the State by Janu-
ary 1, 2008.
‘‘(2) REQUIREMENTS
FOR
EMPLOYERS.—The
manner in which the State will ensure that employ-
ers within the State will comply with the require-
ments of section 2214.
‘‘(3) PART A PROVISIONS.—The following provi-
sions apply to a universal phase (phase II) plan
under this part in the same manner as such provi-
sions apply to an expansion phase (phase I) plan
under part A:
‘‘(A) STATE
OUTREACH
PROGRAMS; AC-
CESS.—Section 2202(a)(4).
‘‘(B) ASSURANCE OF COVERAGE OF ESSEN-
TIAL SERVICES.—Section 2202(a)(5).
‘‘(C) REPRESENTATION ON BOARDS AND
COMMISSIONS.—Section 2202(a)(6).
‘‘(D) DISCLOSURE
OF
INFORMATION
TO
THE PUBLIC.—Section 2202(a)(7).
‘‘(E) CONSUMER PROTECTIONS AND WORK-
FORCE STANDARDS.—Section 2202(a)(8).
‘‘(F) 
PUBLIC
REVIEW.—Section
2202(a)(9).
‘‘(G) SERVICES
IN
RURAL
AND
UNDER-
SERVED AREAS; CULTURAL COMPETENCY.—Sec-
tion 2202(a)(10).
‘‘(H) 
PURCHASING
POOLS.—Section
2202(a)(11).
‘‘(I) LIMITATION ON ADMINISTRATIVE EX-
PENDITURES.—Section 2202(a)(12).
‘‘(J) 
SELF-EMPLOYED
AND
MULTI-
EMPLOYED.—Section 2202(a)(13).
‘‘(K) 
MEDICAID
WRAPAROUND
COV-
ERAGE.—Section 2202(a)(14).
‘‘(4) OTHER MATTERS.—Any other matter de-
termined appropriate by the Secretary.
‘‘(b) PERMISSIBLE ACTIVITIES.—A State may use
amounts provided under this part for any activities con-
sistent with this part that are appropriate to enroll indi-
viduals in health plans to ensure that all eligible residents
of the State are provided coverage under this part, includ-
ing through the use of direct payments to health plans
or providers of services.
‘‘(c) COST CONTAINMENT; COMPETITIVE BIDDING.—
Notwithstanding subsection (b), State purchasing pools
shall solicit bids from health plans at least annually.
‘‘(d) PROCESS
FOR SUBMISSION, APPROVAL, AND
AMENDMENT OF UNIVERSAL PHASE (PHASE II) PLAN.—
Section 2106 applies to a universal phase (phase II) plan
under this part in the same manner as such section applies
to a State plan under title XXI, except that no universal
phase (phase II) plan may be effective earlier than Janu-
ary 1, 2007, and all such plans must be submitted for
approval by not later than January 1, 2006.
‘‘SEC. 2213. COVERAGE REQUIREMENTS FOR UNIVERSAL
PHASE (PHASE II) PLANS.
‘‘(a) REQUIRED SCOPE OF HEALTH INSURANCE COV-
ERAGE.—Section 2203(a) applies to a universal phase
(phase II) plan under this part.
‘‘(b) UNIVERSAL COVERAGE.—All States shall ensure
that by January 1, 2008, 100 percent of eligible residents
of the State have health insurance coverage that meets
the requirements of section 2203(a).
‘‘(c) LIMITATIONS ON PREMIUMS AND COST-SHAR-
ING.—Section 2203(b) applies to a universal phase (phase
II) plan under this part.
‘‘(d) APPLICATION OF CERTAIN REQUIREMENTS.—
Section 2203(c) applies to a universal phase (phase II)
plan under this part.
‘‘SEC. 2214. REQUIREMENTS FOR EMPLOYERS REGARDING
THE PROVISION OF BENEFITS.
‘‘(a) 
REQUIREMENTS.—Subject 
to 
subsection
(c)(2)(B), an employer in a State shall comply with the
following requirements:
‘‘(1) EMPLOYERS
WITH
LESS
THAN
500
EM-
PLOYEES.—
‘‘(A) IN GENERAL.—An employer with less
than 500 employees shall enroll each employee
in a State-designated purchasing pool.
‘‘(B) CONTRIBUTIONS.—
‘‘(i) IN
GENERAL.—Notwithstanding
subparagraph (A) and subject to clause
(ii), the employer shall make a contribution
on behalf of each employee for health in-
surance coverage that is equal to at least
80 percent of the total premiums for such
coverage for employees and their families if
the employee elects dependent coverage.
‘‘(ii) LIMITATION.—An employer shall
not be liable under subparagraph (B) for
more than 10 percent of each employee’s
annual wages.
‘‘(2) EMPLOYERS WITH AT LEAST 500 EMPLOY-
EES.—
‘‘(A) IN GENERAL.—An employer with at
least 500 employees, a majority of whose wages
fall below an amount equal to 300 percent of
the poverty line applicable to a family of the
size involved, shall comply with the require-
ments applicable to an employer under para-
graph (1).
‘‘(B) OTHER EMPLOYERS.—
‘‘(i) IN GENERAL.—An employer with
at least 500 employees that is not de-
scribed in subparagraph (A) shall, at the
option of the employer, either—
‘‘(I) comply with the require-
ments applicable to an employer
under paragraph (1); or
‘‘(II) provide health insurance
coverage to all employees and their
families (if the employee elects de-
pendent coverage) that meets the re-
quirements of section 2213 and the
employer contribution required under
paragraph (1)(B).
‘‘(ii) ADDITIONAL
EMPLOYER
CON-
TRIBUTION.—An employer that elects to
comply with clause (i)(I) shall contribute
an additional 1 percent of payroll into the
State-designated purchasing pool in which
it participates.
‘‘(3) RULE
OF
CONSTRUCTION.—Nothing in
this title shall be construed as prohibiting a labor or-
ganization from collectively bargaining for an em-
ployer contribution that is greater than the contribu-
tion that is required under paragraph (1)(B) or, as
applicable, for health insurance benefits that are
greater than the coverage required under paragraph
section 2203(a).
‘‘(4) PART-TIME
EMPLOYEES.—An employer
shall be responsible for meeting the requirements
under this subsection for all employees of the em-
ployer.
‘‘(5) MULTIEMPLOYER FAMILIES.—In the case
of a family with more than 1 employer, the employ-
ers of individuals within the family shall apportion
their contributions in accordance with rules estab-
lished by the State.
‘‘(b) NONAPPLICABILITY.—This section shall not
apply—
‘‘(1) to any State that establishes a single
payor system; or
‘‘(2) to any State that established a universal
phase (phase II) plan through an approved adden-
dum to an expansion phase (phase I) plan.
‘‘(c) PRIVATE CAUSE OF ACTION.—
‘‘(1) LIABILITY.—An employer that fails to
comply with the requirements of subsection (a) or
otherwise takes adverse action against an employee
for the purpose of interfering with the attainment of
any right to which the employee may be entitled to
under this title, shall be liable to the employee af-
fected.
‘‘(2) AMOUNT.—The amount of the liability de-
scribed in paragraph (1) shall be an amount equal
to—
‘‘(A) the contributions that otherwise
would have been made by the employer on be-
half of the employee under this section;
‘‘(B) an additional amount as liquidated
damages; and
‘‘(C) consequential damages for reasonably
foreseeable injuries resulting from such action.
‘‘(3) JURISDICTION; EQUITABLE RELIEF.—
‘‘(A) JURISDICTION.—An action under this
subsection may be maintained against any em-
ployer in any Federal or State court of com-
petent jurisdiction by any 1 or more employees.
‘‘(B) EQUITABLE RELIEF.—In addition to
the damages described in paragraph (2), a
court may enjoin any act or practice that vio-
lates this title.
‘‘(4) ATTORNEY’S FEES.—If a plaintiff or plain-
tiffs prevail in an action brought under this sub-
section, the court shall, in addition to any judgment
awarded to the plaintiff or plaintiffs, award the rea-
sonable attorney’s fees and costs associated with the
bringing of the action.
‘‘SEC. 2215. ALLOTMENTS.
‘‘(a) STATE ALLOTMENTS.—Subsections (a) and (b)
of section 2204 apply to a universal phase (phase II) plan
under this part in the same manner as such subsections
apply to an expansion phase (phase I) plan under part
A.
‘‘(b) SPECIAL RULE FOR EXPANSION PHASE (PHASE
I) PLANS.—A State that operated an expansion phase
(phase I) plan and converted such plan to a universal
phase (phase II) plan pursuant to section 2211(b)(2)(B)
shall continue to be eligible for the enhanced Federal par-
ticipation rate determined under section 2204(c).
‘‘(c) GRANTS TO INDIAN TRIBES, NATIVE HAWAIIAN
ORGANIZATIONS, 
AND
ALASKA
NATIVE
ORGANIZA-
TIONS.—Section 2204(d) applies to a universal phase
(phase II) plan under this part.
‘‘(d) APPROPRIATION.—
‘‘(1) IN GENERAL.—Out of any funds in the
Treasury not otherwise appropriated, there is appro-
priated to carry out this title such sums as may be
necessary for fiscal year 2007 and each fiscal year
thereafter.
‘‘(2) BUDGET AUTHORITY.—Paragraph (1) con-
stitutes budget authority in advance of appropria-
tions Acts and represents the obligation of the Fed-
eral Government to provide States, Indian tribes,
Native Hawaiian organizations, and Alaska Native
organizations with the allotments determined under
this section and the grants for administrative and
outreach activities under section 2205(a)(1)(B) (as
applied to this part under section 2216(a)).
‘‘SEC. 2216. ADMINISTRATION; DEFINITIONS.
‘‘(a) ADMINISTRATION.—The provisions of section
2205 (other than subsection (c) of such section) apply to
a universal phase (phase II) plan under this part in the
same manner as such provisions apply to an expansion
phase (phase I) plan under part A.
‘‘(b) DEFINITIONS.—
‘‘(1) APPLICATION OF SECTION 2206.—The defi-
nitions set forth in section 2206 apply to a universal
phase (phase II) plan under this part in the same
manner as such provisions apply to an expansion
phase (phase I) plan under part A except that for
purposes of this part, the definition of ‘eligible resi-
dents of a State’ set forth in section 2206(2) shall
be applied without regard to subparagraphs (A)(ii)
and (B).
‘‘(2) UNIVERSAL PHASE (PHASE II) PLAN.—In
this title, the term ‘universal phase (phase II) plan’
means the State universal health insurance coverage
plan submitted under section 2211(b).’’.
SEC. 202. CONSUMER PROTECTIONS.
Title XXII of the Social Security Act, as amended
by section 201, is amended by adding at the end the fol-
lowing:
‘‘PART C—CONSUMER PROTECTIONS
‘‘SEC. 2221. HOME CARE STANDARDS.
‘‘In order to ensure that home care services are pro-
vided in a consumer-directed manner, a State partici-
pating under part A, and, effective January 1, 2007, all
States under part B, shall satisfy the Secretary that any
health plan that provides home care services under this
title creates, or contracts with, a viable entity other than
the consumer or individual provider to provide effective
billing, payments for services, tax withholding, unemploy-
ment insurance, and workers compensation coverage, and
to serve as the statutory employer of the home care pro-
vider. Recipients of such services shall retain the right to
independently select, hire, terminate, and direct the work
of the home care provider.
‘‘SEC. 2222. CONSUMER PROTECTION IN THE EVENT OF
TERMINATION OR SUSPENSION OF SERVICES.
‘‘A State participating under part A, and, effective
January 1, 2007, all States under part B, shall satisfy
the Secretary that any health plan providing services
under this title shall ensure that enrollees will receive con-
tinued health services in the event that the plan’s health
care services are terminated or suspended, including as
the result of the plan filing for bankruptcy relief under
title 11, United States Code, or the failure of the plan
to provide payments to providers, lockouts, work stop-
pages, or other labor management problems.
‘‘SEC. 2223. CONSUMER PROTECTION THROUGH DISCLO-
SURE OF INFORMATION.
‘‘(a) IN GENERAL.—A State participating under part
A, and, effective January 1, 2007, all States under part
B, shall satisfy the Secretary that any health care provider
that provides services to individuals under this title shall
provide to the State information regarding the identity,
employment location, and qualifications of health care
workers providing services under—
‘‘(1) the licensure of the provider; or
‘‘(2) a contract between the provider and a
health plan or the State.
‘‘(b) AVAILABILITY TO PUBLIC.—A health care pro-
vider shall make the information described in subsection
(a) available to the public.
‘‘SEC. 2224. CONSUMER PROTECTION THROUGH NOTICE OF
CHANGES IN HEALTH CARE DELIVERY.
‘‘A State participating under part A, and, effective
January 1, 2007, all States under part B, shall describe
how the State will provide, at a minimum, the following
protections:
‘‘(1) Adequate advance notice to the public, the
affected health care workers, and labor organizations
representing such workers, of a pending—
‘‘(A) facility or operating unit closure;
‘‘(B) sale, merger, or consolidation of a fa-
cility or operating unit;
‘‘(C) transfer of work from 1 facility or en-
tity to another facility or entity; or
‘‘(D) reduction of services.
‘‘(2) A right of first refusal for similar vacant
positions with—
‘‘(A) the resulting entity, in the case of a
health care worker whose position was elimi-
nated following a merger of the worker’s origi-
nal employer with a new entity; or
‘‘(B) the contractor, in the case of a health
care worker whose position was eliminated fol-
lowing the contracting out of the work the
worker formerly performed.’’.
TITLE III—PATIENT
PROTECTIONS
SEC. 301. INCORPORATION OF CERTAIN PROTECTIONS.
(a) INCORPORATION.—The provisions of the following
bills are hereby enacted into law:
(1) S. 1052 of the 107th Congress, as passed
by the Senate on June 29, 2001.
(2) H.R. 2340 of the 107th Congress, as intro-
duced on June 27, 2001.
(b) PUBLICATION.—In publishing this Act in slip
form and in the United States Statutes at Large pursuant
to section 112, of title 1, United States Code, the Archivist
of the United States shall include after the date of ap-
proval at the end appendixes setting forth the texts of the
bills referred to in subsection (a) of this section.
TITLE IV—HEALTH CARE QUAL-
ITY, PATIENT SAFETY, AND
WORKFORCE STANDARDS
SEC. 401. HEALTH CARE QUALITY, PATIENT SAFETY, AND
WORKFORCE STANDARDS INSTITUTE.
(a) ESTABLISHMENT.—
(1) INSTITUTE.—There is established within
the Agency for Healthcare Research and Quality, an
institute to be known as the Health Care Quality,
Patient Safety, and Workforce Standards Institute
(in this section referred to as the ‘‘Institute’’).
(2) DIRECTOR.—The Secretary of Health and
Human Services shall appoint a director of the Insti-
tute. The director shall administer the Institute and
carry out the duties of the director under this sec-
tion subject to the authority, direction, and control
of the Secretary.
(b) MISSION.—The mission of the Institute is to—
(1) demonstrate how patient safety issues and
workplace conditions are linked to quality patient
care and the reduction of the incidence of medical
errors; and
(2) reduce the incidence of medical errors and
improve patient safety and quality of care.
(c) DUTIES.—In carrying out the mission of the In-
stitute, the director of the Institute shall—
(1) work closely with the director of the Agency
for Healthcare Research and Quality to ensure that
issues related to workplace conditions are reflected
in the activities conducted by such agency in order
to reduce the incidence of medical errors and im-
prove patient safety and quality of care, including—
(A) the establishment of national goals;
(B) the development and implementation
of a research agenda;
(C) the development and promotion of best
practices;
(D) the development of performance and
staffing standards in consultation with the
Health Care Financing Administration and
other Federal agencies, as appropriate; and
(E) the development and dissemination of
information, educational and training materials,
and other criteria as it relates to the delivery of
quality care;
(2) provide recommendations to the Secretary
of Health and Human Services and other Federal
agencies with responsibility for health care quality
and the development of standards that impact on
the delivery of quality patient care on standards re-
lated to workplace conditions and patient safety;
(3) support the activities of the Health Care Fi-
nancing Administration related to the development
of new or revised conditions of participation under
the medicare and medicaid programs and subsequent
rulemaking on issues related to workplace condi-
tions, medical errors, and patient safety and quality
of care; and
(4) conduct other activities determined appro-
priate by the director of the Institute.
(d) WORKPLACE CONDITIONS.—For purposes of this
section, the term ‘‘workplace conditions’’ shall include
issues related to—
(1) health care worker staffing;
(2) hours of work;
(3) confidentiality and whistleblower protec-
tions;
(4) employee participation in decisionmaking
roles that contribute to improved quality of care and
the reduction of the incidence of medical errors;
(5) workforce training; and
(6) the impact of health care delivery restruc-
turing on communities and health care workers.
(e) DEFINITION OF HEALTH CARE WORKER.—
(1) IN
GENERAL.—In this section, the term
‘‘health care worker’’ means an individual employed
by an employer that provides—
(A) health care services; or
(B) necessary related services, including
administrative, food service, janitorial, or main-
tenance service to an entity that provides such
health care services.
(2) HEALTH
CARE
SERVICES.—In paragraph
(1), the term ‘‘health care services’’ includes med-
ical, surgical, mental health, and substance abuse
services, whether provided on an in-patient or out-
patient basis.
(f) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated to the Institute such
sums as may be necessary to carry out the purposes of
this section.
SEC. 402. HEALTH CARE QUALITY, PATIENT SAFETY, AND
WORKFORCE STANDARDS ADVISORY COM-
MITTEE.
(a) ESTABLISHMENT OF COMMITTEE.—There is es-
tablished a Health Care Quality, Patient Safety, and
Workforce Standards Committee (in this section referred
to as the ‘‘Committee’’).
(b) FUNCTIONS OF COMMITTEE.—
(1) ADVICE
TO
INSTITUTE.—The Committee
shall provide advice to the Director of the Health
Care Quality, Patient Safety, and Workforce Stand-
ards Institute established under section 401 on
issues related to the duties of the Director.
(2) INITIAL REPORT.—Not later than December
31, 2003, the Committee shall submit an initial re-
port to the Secretary that contains—
(A) recommendations regarding minimal
workforce standards that are critical for im-
proved health care quality and patient safety;
and
(B) recommendations regarding additional
ways to reduce the incidence of medical errors
and to improve patient safety and quality of
care.
(3) FINAL REPORT.—Not later than December
31, 2004, the Committee shall submit a final report
to the Secretary of Health and Human Services re-
garding the recommendations contained in the initial
report required under paragraph (2), including any
modifications of such recommendations.
(c) STRUCTURE AND MEMBERSHIP OF THE COM-
MITTEE.—
(1) STRUCTURE.—The Committee shall be com-
posed of the Director of the Health Care Quality,
Patient Safety, and Workforce Standards Institute
established under section 401 and 15 additional
members who shall be appointed by the Secretary of
Health and Human Services.
(2) MEMBERSHIP.—
(A) IN
GENERAL.—The members of the
Committee shall be chosen on the basis of their
integrity, impartiality, and good judgment, and
shall be individuals who are, by reason of their
education, experience, and attainments, excep-
tionally qualified to perform the duties of mem-
bers of the Committee.
(B) SPECIFIC MEMBERS.—In making ap-
pointments under paragraph (1), the Secretary
of Health and Human Services shall ensure
that the following groups are represented:
(i) Health care providers and health
care workers, including labor unions rep-
resenting health care workers.
(ii) Consumer organizations.
(iii) Health care institutions.
(iv) Health education organizations.
(d) CHAIRMAN.—The Director of the Health Care
Quality, Patient Safety, and Workforce Standards Insti-
tute established under section 401 shall chair the Com-
mittee.
TITLE V—IMPROVING MEDICARE
BENEFITS
SEC. 501. FULL MENTAL HEALTH AND SUBSTANCE ABUSE
TREATMENT BENEFITS PARITY.
Notwithstanding any provision of title XVIII of the
Social Security Act (42 U.S.C. 1395 et seq.), beginning
January 1, 2003, each individual who is entitled to bene-
fits under part A or enrolled under part B of the medicare
program, 
including 
an 
individual 
enrolled 
in 
a
Medicare+Choice plan offered by a Medicare+Choice or-
ganization under part C of such program, shall be pro-
vided full mental health and substance abuse treatment
parity under the medicare program established under such
title of such Act consistent with title XXII of the Social
Security Act (as added by this Act).
TITLE VI—LONG-TERM AND
HOME HEALTH CARE
SEC. 601. STUDIES AND DEMONSTRATION PROJECTS TO
IDENTIFY MODEL PROGRAMS.
The Secretary of Health and Human Services shall—
(1) conduct studies and demonstration projects,
through grant, contract, or interagency agreement,
that are designed to identify model programs for the
provision of long-term and home health care serv-
ices;
(2) report regularly to Congress on the results
of such studies and demonstration projects; and
(3) include in such report any recommendations
for legislation to expand or continue such studies
and projects.
TITLE VII—MISCELLANEOUS
SEC. 701. NONAPPLICATION OF ERISA.
The provisions of section 514 of the Employee Retire-
ment Income Security Act of 1974 (29 U.S.C. 1144) shall
not apply with respect to health benefits provided under
a group health plan (as defined in section 733(a) of that
Act (29 U.S.C. 1191b(a))) qualified to offer such benefits
under an expansion phase (phase I) plan under title XXII
of the Social Security Act (as added by this Act) or under
a universal phase (phase II) plan under such title.
SEC. 702. SENSE OF CONGRESS REGARDING OFFSETS.
It is the sense of Congress that any sums necessary
for the implementation of this Act, and the amendments
made by this Act, should be offset by—
(1) general revenues available as a result of an
on-budget surplus for a fiscal year;
(2) direct savings in health care expenditures
resulting from the implementation of this Act; and
(3) reductions in unnecessary Federal tax bene-
fits available only to individuals and large corpora-
tions that are in the maximum tax brackets.
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