In the Senate of the United States,
October 19, 2005.
Resolved, That the bill from the House of Representa-
tives (H.R. 3204) entitled ‘‘An Act to amend title XXVII of
the Public Health Service Act to extend Federal funding for
the establishment and operation of State high risk health in-
surance pools.’’, do pass with the following
AMENDMENT:
Strike out all after the enacting clause and insert:
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘State High Risk Pool
Funding Extension Act of 2005’’.
†
HR 3204 EAS
SEC. 2. EXTENSION OF FUNDING FOR OPERATION OF
STATE 
HIGH 
RISK 
HEALTH 
INSURANCE
POOLS.
Section 2745 of the Public Health Service Act (42
U.S.C. 300gg–45) is amended to read as follows:
‘‘SEC. 2745. RELIEF FOR HIGH RISK POOLS.
‘‘(a) SEED GRANTS TO STATES.—The Secretary shall
provide from the funds appropriated under subsection
(d)(1)(A) a grant of up to $1,000,000 to each State that
has not created a qualified high risk pool as of the date
of enactment of the State High Risk Pool Funding Exten-
sion Act of 2005 for the State’s costs of creation and initial
operation of such a pool.
‘‘(b) GRANTS FOR OPERATIONAL LOSSES.—
‘‘(1) IN GENERAL.—In the case of a State that
has established a qualified high risk pool that—
‘‘(A) restricts premiums charged under the
pool to no more than 200 percent of the premium
for applicable standard risk rates;
‘‘(B) offers a choice of two or more coverage
options through the pool; and
‘‘(C) has in effect a mechanism reasonably
designed to ensure continued funding of losses in-
curred by the State in connection with operation
of the pool after the end of the last fiscal year
†
HR 3204 EAS
for which a grant is provided under this para-
graph;
the Secretary shall provide, from the funds appro-
priated under paragraphs (1)(B)(i) and (2)(A) of
subsection (d) and allotted to the State under para-
graph (2), a grant for the losses incurred by the State
in connection with the operation of the pool.
‘‘(2) ALLOTMENT.—Subject to paragraph (4), the
amounts appropriated under paragraphs (1)(B)(i)
and (2)(A) of subsection (d) for a fiscal year shall be
allotted and made available to the States (or the enti-
ties that operate the high risk pool under applicable
State law) that qualify for a grant under paragraph
(1) as follows:
‘‘(A) An amount equal to 40 percent of such
appropriated amount for the fiscal year shall be
allotted in equal amounts to each qualifying
State that is one of the 50 States or the District
of Columbia and that applies for a grant under
this subsection.
‘‘(B) An amount equal to 30 percent of such
appropriated amount for the fiscal year shall be
allotted among qualifying States that apply for
such a grant so that the amount allotted to such
a State bears the same ratio to such appro-
†
HR 3204 EAS
priated amount as the number of uninsured in-
dividuals in the State bears to the total number
of uninsured individuals (as determined by the
Secretary) in all qualifying States that so apply.
‘‘(C) An amount equal to 30 percent of such
appropriated amount for the fiscal year shall be
allotted among qualifying States that apply for
such a grant so that the amount allotted to a
State bears the same ratio to such appropriated
amount as the number of individuals enrolled in
health care coverage through the qualified high
risk pool of the State bears to the total number
of individuals so enrolled through qualified high
risk pools (as determined by the Secretary) in all
qualifying States that so apply.
‘‘(3) SPECIAL RULE FOR POOLS CHARGING HIGH-
ER PREMIUMS.—In the case of a qualified high risk
pool of a State which charges premiums that exceed
150 percent of the premium for applicable standard
risks, the State shall use at least 50 percent of the
amount of the grant provided to the State to carry
out this subsection to reduce premiums for enrollees.
‘‘(4) LIMITATION FOR TERRITORIES.—In no case
shall the aggregate amount allotted and made avail-
able under paragraph (2) for a fiscal year to States
†
HR 3204 EAS
that are not the 50 States or the District of Columbia
exceed $1,000,000.
‘‘(c) BONUS GRANTS FOR SUPPLEMENTAL CONSUMER
BENEFITS.—
‘‘(1) IN GENERAL.—In the case of a State that
is one of the 50 States or the District of Columbia,
that has established a qualified high risk pool, and
that is receiving a grant under subsection (b)(1), the
Secretary shall provide, from the funds appropriated
under paragraphs (1)(B)(ii) and (2)(B) of subsection
(d) and allotted to the State under paragraph (3), a
grant to be used to provide supplemental consumer
benefits to enrollees or potential enrollees (or defined
subsets of such enrollees or potential enrollees) in
qualified high risk pools.
‘‘(2) BENEFITS.—A State shall use amounts re-
ceived under a grant under this subsection to provide
one or more of the following benefits:
‘‘(A) Low-income premium subsidies.
‘‘(B) A reduction in premium trends, actual
premiums, or other cost-sharing requirements.
‘‘(C) An expansion or broadening of the
pool of individuals eligible for coverage, such as
through eliminating waiting lists, increasing en-
†
HR 3204 EAS
rollment caps, or providing flexibility in enroll-
ment rules.
‘‘(D) Less stringent rules, or additional
waiver authority, with respect to coverage of pre-
existing conditions.
‘‘(E) Increased benefits.
‘‘(F) The establishment of disease manage-
ment programs.
‘‘(3) ALLOTMENT; LIMITATION.—The Secretary
shall allot funds appropriated under paragraphs
(1)(B)(ii) and (2)(B) of subsection (d) among States
qualifying for a grant under paragraph (1) in a
manner specified by the Secretary, but in no case
shall the amount so allotted to a State for a fiscal
year exceed 10 percent of the funds so appropriated
for the fiscal year.
‘‘(4) RULE OF CONSTRUCTION.—Nothing in this
subsection shall be construed to prohibit a State that,
on the date of the enactment of the State High Risk
Pool Funding Extension Act of 2005, is in the process
of implementing a program to provide benefits of the
type described in paragraph (2), from being eligible
for a grant under this subsection.
‘‘(d) FUNDING.—
†
HR 3204 EAS
‘‘(1) APPROPRIATION FOR FISCAL YEAR 2006.—
There are authorized to be appropriated and there are
appropriated for fiscal year 2006—
‘‘(A) $15,000,000 to carry out subsection
(a); and
‘‘(B) $75,000,000, of which, subject to para-
graph (4)—
‘‘(i) two-thirds of the amount appro-
priated shall be made available for allot-
ments under subsection (b)(2); and
‘‘(ii) one-third of the amount appro-
priated shall be made available for allot-
ments under subsection (c)(3).
‘‘(2) AUTHORIZATION OF APPROPRIATIONS FOR
FISCAL YEARS 2007 THROUGH 2010.—There are au-
thorized to be appropriated $75,000,000 for each of
fiscal years 2007 through 2010, of which, subject to
paragraph (4)—
‘‘(A) two-thirds of the amount appropriated
for a fiscal year shall be made available for al-
lotments under subsection (b)(2); and
‘‘(B) one-third of the amount appropriated
for a fiscal year shall be made available for al-
lotments under subsection (c)(3).
†
HR 3204 EAS
‘‘(3) AVAILABILITY.—Funds appropriated for
purposes of carrying out this section for a fiscal year
shall remain available for obligation through the end
of the following fiscal year.
‘‘(4) REALLOTMENT.—If, on June 30 of each fis-
cal year for which funds are appropriated under
paragraph (1)(B) or (2), the Secretary determines
that all the amounts so appropriated are not allotted
or otherwise made available to States, such remaining
amounts shall be allotted and made available under
subsection (b) among States receiving grants under
subsection (b) for the fiscal year based upon the allot-
ment formula specified in such subsection.
‘‘(5) NO ENTITLEMENT.—Nothing in this section
shall be construed as providing a State with an enti-
tlement to a grant under this section.
‘‘(e) APPLICATIONS.—To be eligible for a grant under
this section, a State shall submit to the Secretary an appli-
cation at such time, in such manner, and containing such
information as the Secretary may require.
‘‘(f) ANNUAL REPORT.—The Secretary shall submit to
Congress an annual report on grants provided under this
section. Each such report shall include information on the
distribution of such grants among States and the use of
grant funds by States.
†
HR 3204 EAS
‘‘(g) DEFINITIONS.—In this section:
‘‘(1) QUALIFIED HIGH RISK POOL.—
‘‘(A) IN
GENERAL.—The term ‘qualified
high risk pool’ has the meaning given such term
in section 2744(c)(2), except that a State may
elect to meet the requirement of subparagraph
(A) of such section (insofar as it requires the
provision of coverage to all eligible individuals)
through providing for the enrollment of eligible
individuals through an acceptable alternative
mechanism (as defined for purposes of section
2744) that includes a high risk pool as a compo-
nent.
‘‘(2) STANDARD RISK RATE.—The term ‘standard
risk rate’ means a rate—
‘‘(A) determined under the State high risk
pool by considering the premium rates charged
by other health insurers offering health insurance
coverage to individuals in the insurance market
served;
‘‘(B) that is established using reasonable ac-
tuarial techniques; and
‘‘(C) that reflects anticipated claims experi-
ence and expenses for the coverage involved.
†
HR 3204 EAS
‘‘(3) STATE.—The term ‘State’ means any of the
50 States and the District of Columbia and includes
Puerto Rico, the Virgin Islands, Guam, American
Samoa, and the Northern Mariana Islands.’’.
Attest:
Secretary.