I 
108TH CONGRESS 
1ST SESSION 
H. R. 256
To provide for premium assistance for COBRA continuation coverage for 
certain individuals and to permit States to provide temporary Medicaid 
coverage for certain uninsured employees. 
IN THE HOUSE OF REPRESENTATIVES 
JANUARY 8, 2003
Mr. BOUCHER (for himself and Mr. GOODE) introduced the following bill; 
which was referred to the Committee on Education and the Workforce, 
and in addition to the Committees on Energy and Commerce and Ways 
and Means, for a period to be subsequently determined by the Speaker, 
in each case for consideration of such provisions as fall within the juris-
diction of the committee concerned 
A BILL 
To provide for premium assistance for COBRA continuation 
coverage for certain individuals and to permit States 
to provide temporary Medicaid coverage for certain unin-
sured employees.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Health Care Coverage 
Assistance for the Unemployed Act of 2003’’.
SEC. 2. PREMIUM ASSISTANCE FOR COBRA CONTINUATION 
COVERAGE. 
(a) ESTABLISHMENT.—
(1) IN GENERAL.—Not later than 60 days after 
the date of enactment of this Act, the Secretary of 
Labor shall establish a program under which pre-
mium assistance for COBRA continuation coverage 
shall be provided for qualified individuals under this 
section. 
(2) QUALIFIED INDIVIDUALS.—For purposes of 
this section, a qualified individual is an individual 
who—
(A) establishes that the individual—
(i) on or after January 1, 2001, and 
before January 1, 2004, became entitled to 
elect COBRA continuation coverage (other 
than solely on the basis described in para-
graph (3), (4), (5), or (6) of section 603 
of the Employee Retirement Income Secu-
rity Act of 1974); and 
(ii) has elected such coverage; and 
(B) enrolls in the premium assistance pro-
gram under this section by not later than De-
cember 31, 2003. 
(b) LIMITATION OF PERIOD OF PREMIUM ASSIST-
ANCE.—Premium assistance provided under this sub-
section shall end with respect to an individual on the ear-
lier of—
(1) the date the individual is no longer covered 
under COBRA continuation coverage; or 
(2) 18 months after the date the individual is 
first enrolled in the premium assistance program es-
tablished under this section. 
(c) PAYMENT, AND CREDITING OF ASSISTANCE.—
(1) AMOUNT OF ASSISTANCE.—Premium assist-
ance provided under this section shall be equal to 75 
percent of the amount of the premium required for 
the COBRA continuation coverage. 
(2) PROVISION OF ASSISTANCE.—Premium as-
sistance provided under this section shall be pro-
vided through the establishment of direct payment 
arrangements with the administrator of the group 
health plan (or other entity) that provides or admin-
isters the COBRA continuation coverage. It shall be 
a fiduciary duty of such administrator (or other en-
tity) to enter into such arrangements under this sec-
tion. 
(3) PREMIUMS PAYABLE BY QUALIFIED INDI-
VIDUAL
REDUCED
BY
AMOUNT
OF
ASSISTANCE.—
Premium assistance provided under this section shall 
be credited by such administrator (or other entity)
against the premium otherwise owed by the indi-
vidual involved for such coverage. 
(d) CHANGE IN COBRA NOTICE.—
(1) GENERAL NOTICE.—
(A) IN GENERAL.—In the case of notices 
provided under sections 606 of the Employee 
Retirement Income Security Act of 1974, sec-
tion 2206 of the Public Health Service Act, and 
section 4980B(f)(6) of the Internal Revenue 
Code of 1986 with respect to individuals who, 
on or after January 1, 2001, and before Janu-
ary 1, 2004, become entitled to elect COBRA 
continuation coverage, such notices shall include 
an additional notification to the recipient of the 
availability of premium assistance for such cov-
erage under this section. 
(B) ALTERNATIVE NOTICE.—In the case of 
COBRA continuation coverage to which the no-
tice provisions described in subparagraph (A) 
do not apply, the Secretary of Labor shall, in 
coordination with administrators of the group 
health plans (or other entities) that provide or 
administer the COBRA continuation coverage 
involved, assure provision of such notice.
(C) FORM.—The requirement of the addi-
tional notification under this paragraph may be 
met by amendment of existing notice forms or 
by inclusion of a separate document with the 
notice otherwise required. 
(2) SPECIFIC REQUIREMENTS.—Each additional 
notification under paragraph (1) shall include—
(A) the forms necessary for establishing 
eligibility under subsection (a)(2)(A) and enroll-
ment under subsection (a)(2)(B) in connection 
with the coverage with respect to each covered 
employee or other qualified beneficiary; 
(B) the name, address, and telephone num-
ber necessary to contact the plan administrator 
and any other person maintaining relevant in-
formation in connection with the premium as-
sistance; and 
(C) the following statement displayed in a 
prominent manner: 
‘‘You may be eligible to receive assistance with pay-
ment of 75 percent of your COBRA continuation coverage 
premiums for a duration of not to exceed 18 months.’’. 
(3) NOTICE RELATING TO RETROACTIVE COV-
ERAGE.—In the case of such notices previously 
transmitted before the date of the enactment of this
Act in the case of an individual described in para-
graph (1) who has elected (or is still eligible to elect) 
COBRA continuation coverage as of the date of the 
enactment of this Act, the administrator of the 
group health plan (or other entity) involved or the 
Secretary of Labor (in the case described in the 
paragraph (1)(B)) shall provide (within 60 days 
after the date of the enactment of this Act) for the 
additional notification required to be provided under 
paragraph (1). 
(4) MODEL NOTICES.—The Secretary of Labor 
shall prescribe models for the additional notification 
required under this subsection. 
(e) OBLIGATION
OF
FUNDS.—This section con-
stitutes budget authority in advance of appropriations 
Acts and represents the obligation of the Federal Govern-
ment to provide for the payment of premium assistance 
under this section. 
(f) PROMPT ISSUANCE
OF GUIDANCE.—The Sec-
retary of Labor shall issue guidance under this section not 
later than 30 days after the date of the enactment of this 
Act. 
(g) DEFINITIONS.—In this Act: 
(1) ADMINISTRATOR.—The term ‘‘adminis-
trator’’ has the meaning given such term in section
SEC. 3. OPTIONAL TEMPORARY MEDICAID COVERAGE FOR 
UNINSURED ELIGIBLE EMPLOYEES. 
(a) IN GENERAL.—Notwithstanding any other provi-
sion of law, a State may elect to provide, under its med-
icaid program under title XIX of the Social Security Act, 
medical assistance in the case of an individual who is eligi-
ble for unemployment benefits, who is not eligible for 
COBRA continuation coverage, and who is uninsured. For 
purposes of this section, an individual is considered to be 
uninsured if the individual is not covered under a group 
health plan, health insurance coverage, or under such pro-
gram or a program under title XVIII or XXI of such Act. 
(b) LIMITATION TO 18 MONTHS OF COVERAGE.—As-
sistance under this section shall end with respect to an 
individual on the earlier of—
(1) the date the individual is no longer unin-
sured; or 
(2) 18 months after the date the individual is 
first determined to be eligible for medical assistance 
under this section. 
(c) SPECIAL RULES.—In the case of medical assist-
ance provided under this section—
(1) the Federal medical assistance percentage 
under section 1905(b) of the Social Security Act 
shall be 100 percent;
(2) a State may elect to disregard any income, 
asset, or resource limitation imposed under the State 
medicaid plan or under title XIX of such Act, ex-
cept, notwithstanding any other provision of law, a 
State shall condition eligibility for assistance under 
this section upon the payment of a monthly premium 
approximating 25 percent of the average cost of pro-
viding the assistance under this section; 
(3) such medical assistance shall not be pro-
vided for periods before the date the individual is de-
termined eligible for such assistance; 
(4) a State may elect to make eligible for such 
assistance a dependent spouse or children of an indi-
vidual eligible for medical assistance under sub-
section (a), if such spouse or children are uninsured; 
and 
(5) individuals eligible for medical assistance 
under this section shall be deemed to be described 
in the list of individuals described in the matter pre-
ceding paragraph (1) of section 1905(a) of such Act.
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