(1) GROUP HEALTH PLANS.—Subject to para-
graph (3), the amendments made by subsection (a)
shall apply with respect to group health plans for
plan years beginning on or after January 1, 2000.
(2) 
HEALTH
INSURANCE
COVERAGE.—The
amendment made by subsection (b) shall apply with
respect to health insurance coverage offered, sold,
issued, renewed, in effect, or operated in the individ-
ual market on or after such date.
(3) COLLECTIVE BARGAINING AGREEMENTS.—
In the case of a group health plan maintained pur-
suant to 1 or more collective bargaining agreements
between employee representatives and 1 or more em-
ployers ratified before the date of enactment of this
Act, the amendments made subsection (a) shall not
apply to plan years beginning before the later of—
(A) the date on which the last collective
bargaining agreements relating to the plan ter-
minates (determined without regard to any ex-
tension thereof agreed to after the date of en-
actment of this Act), or
(B) January 1, 2000.
For purposes of subparagraph (A), any plan amend-
ment made pursuant to a collective bargaining
agreement relating to the plan which amends the
plan solely to conform to any requirement added by
subsection (a) shall not be treated as a termination
of such collective bargaining agreement.
SEC. 3. APPLICATION TO MEDICARE AND MEDICAID BENE-
FICIARIES.
(a) MEDICARE.—
(1) IN GENERAL.—Title XVIII of the Social Se-
curity Act (42 U.S.C. 1395 et seq.) is amended by
adding at the end the following:
‘‘STANDARDS RELATING TO COVERAGE OF HOSPITAL
LENGTHS OF STAY
‘‘SEC. 1897. (a) APPLICATION TO MEDICARE.—Not-
withstanding the limitation on benefits described in sec-
tion 1812, or any other limitation on benefits imposed
under this title, the provisions of section 2707 of the Pub-
lic Health Service Act shall apply to the provision of items
and services under this title.
‘‘(b) MEDICARE+CHOICE AND ELIGIBLE ORGANIZA-
TIONS.—The Secretary may not enter into a contract with
a Medicare+Choice organization under part C, or with an
eligible organization with a risk-sharing contract under
section 1876, unless the organization meets the require-
ments of section 2707 of the Public Health Service Act
with respect to individuals enrolled with the organiza-
tion.’’.
(2) MEDICARE SUPPLEMENTAL POLICIES.—
(A) IN GENERAL.—Section 1882(c) of the
Social Security Act (42 U.S.C. 1395ss(c)) is
amended—
(i) in paragraph (4), by striking
‘‘and’’ at the end;
(ii) in paragraph (5), by striking the
period and inserting ‘‘, and’’; and
(iii) by adding at the end the follow-
ing:
‘‘(6) meets the requirements of section 2707 of
the Public Health Service Act with respect to indi-
viduals enrolled under the policy.’’.
(B) CONFORMING
AMENDMENT.—Section
1882(b)(1)(B) of the Social Security Act (42
U.S.C. 1395ss(b)(1)(B)) is amended by striking
‘‘(5)’’ and inserting ‘‘(6)’’.
(3) COST SHARING.—Nothing in this subsection
or section 2707(c) of the Public Health Service Act
shall be construed as authorizing the imposition of
cost sharing with respect to the coverage or benefits
required to be provided under the amendments to
the Social Security Act made by paragraphs (1) and
(2) that is inconsistent with the cost sharing that is
otherwise permitted under title XVIII of the Social
Security Act.
(b) MEDICAID.—Title XIX of the Social Security Act
(42 U.S.C. 1396 et seq.) is amended by redesignating sec-
tion 1935 as section 1936 and by inserting after section
1934 the following:
‘‘STANDARDS RELATING TO COVERAGE OF HOSPITAL
LENGTHS OF STAY
‘‘SEC. 1935. (a) IN GENERAL.—A State plan may
not be approved under this title unless the plan requires
each health insurance issuer or other entity with a con-
tract with such plan to provide coverage or benefits to in-
dividuals eligible for medical assistance under the plan, in-
cluding a managed care entity, as defined in section
1932(a)(1)(B), to comply with the provisions of section
2707 of the Public Health Service Act with respect to such
coverage or benefits.
‘‘(b) COST SHARING.—Nothing in this section or sec-
tion 2707(c) of the Public Health Service Act shall be con-
strued as authorizing a health insurance issuer or entity
to impose cost sharing with respect to the coverage or ben-
efits required to be provided under section 2707 of the
Public Health Service Act that is inconsistent with the
cost sharing that is otherwise permitted under this title.
‘‘(c) WAIVERS PROHIBITED.—The requirement of
subsection (a) may not be waived under section 1115 or
section 1915(b) of the Social Security Act.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section apply to contract years under titles XVIII and
XIX of the Social Security Act beginning on or after Jan-
uary 1, 2000.
(d) MEDIGAP TRANSITION PROVISIONS.—
(1) IN GENERAL.—If the Secretary of Health
and Human Services identifies a State as requiring
a change to its statutes or regulations to conform its
regulatory program to the changes made by sub-
section (a)(2), the State regulatory program shall
not be considered to be out of compliance with the
requirements of section 1882 of the Social Security
Act due solely to failure to make such change until
the date specified in paragraph (4).
(2) NAIC STANDARDS.—If, within 9 months
after the date of the enactment of this Act, the Na-
tional Association of Insurance Commissioners (in
this subsection referred to as the ‘‘NAIC’’) modifies
its NAIC Model Regulation relating to section 1882
of the Social Security Act (referred to in such sec-
tion as the 1991 NAIC Model Regulation, as modi-
fied pursuant to section 171(m)(2) of the Social Se-
curity Act Amendments of 1994 (Public Law 103–
432) 
and 
as 
modified 
pursuant 
to 
section
1882(d)(3)(A)(vi)(IV) of the Social Security Act, as