114
health plans and by the medicare program under
title XVIII of the Social Security Act.
(2) APPLICATION
AND
REVISION.—The Com-
mission shall by no later than 1 year after the effec-
tive date of implementation of the Commission’s rec-
ommendation under section 212, require that the
uniform claims form developed under paragraph (1),
be utilized by all carriers offering benefits covered
under the BasiCare benefits package and under title
XVIII of the Social Security Act. The Commission
shall revise such form, as necessary, to reflect
changes in the health care insurance market.
(3) UNIFORM REPORTING STANDARDS.—In de-
veloping the claims form under paragraph (1), the
Commission in consultation with the entities de-
scribed in such paragraph, shall develop standards
for uniform reporting (while preserving individual
patient identity) concerning—
(A) the types and amounts of required
health services provided; and
(B) the costs of such facilities providing
such services.
The Commission shall periodically collect, analyze,
and disseminate information received under this
paragraph.
115
(4) UNIVERSAL
ELECTRONIC
PAYMENT
AND
BILLING CARD.—In conjunction with development of
the standard claims form under paragraph (1), the
Commission shall develop, and all private and public
health insurance programs shall be required to par-
ticipate in, a program to provide a universal health
insurance card to every individual or family which
shall be accepted by all health care providers for
purposes of payment and billing. Such cards shall be
imprinted electronically with necessary and appro-
priate information concerning coverage and billing,
and to the maximum extent practicable, with infor-
mation to assist in the management of a uniform
system of computerized patient records.
(h) LONG-TERM DISPOSITION OF MEDICAID BENE-
FITS AND PROGRAM.—
(1) IN GENERAL.—At any time following the ef-
fective date of implementation of the Commission’s
recommendation under section 212, the Commission
may submit to Congress a proposed plan for long-
term disposition of any benefits of the medicaid pro-
gram not covered under or subsumed by the
BasiCare benefits package.
(2) PROPOSED PLAN.—In preparing a proposed
plan described in paragraph (1), the Commission
116
shall consult with representatives of State medicaid
programs, and shall follow the goals and guidelines
described in section 211.
(3) CONGRESSIONAL CONSIDERATION.—Propos-
als made to Congress under this subsection shall be
considered by the Congress under the procedures for
consideration of an ‘‘approval resolution’’ as de-
scribed in subtitle D.
(4) PERIOD
FOR
RESUBMISSION
OF
PRO-
POSAL.—If the recommendation of the Commission
submitted under this subsection is not approved by
Congress in a year, the Commission shall by not
later than January 1 of each year thereafter, for a
period not to exceed 2 years (unless such rec-
ommendation is approved in a year) submit a new
recommendation to Congress subject to the guide-
lines and requirements of this title.
(i) ASSIMILATION
OF MEDICARE INTO BASICARE
SYSTEM.—
(1) IN GENERAL.—The Commission shall by no
later than January 1 of the fifth year following the
effective date of implementation of the Commission’s
recommendation under section 212, submit to the
Congress draft legislation providing for the assimila-
tion of the medicare program under title XVIII of
117
the Social Security Act into the BasiCare system.
The Commission shall include with such draft legis-
lation, an accompanying report detailing and ex-
plaining the provisions of such draft legislation.
(2) CONGRESSIONAL CONSIDERATION.—Propos-
als made to Congress under this subsection shall be
considered by Congress under the procedures for
consideration of an ‘‘approval resolution’’ as de-
scribed in subtitle D.
(3) PERIOD
FOR
RESUBMISSION
OF
PRO-
POSAL.—If the proposal of the Commission submit-
ted under this subsection is not approved by Con-
gress in a year, the Commission shall by not later
than January 1 of each year thereafter, for a period
not to exceed 2 years (unless such recommendation
is approved in a year) submit a new proposal to
Congress subject to the guidelines and requirements
of this title.
(j) ASSIMILATION
OF
OTHER
PROGRAMS
INTO
BASICARE SYSTEM.—
(1) IN GENERAL.—The Commission shall by no
later than January 1 of the fifth year following the
effective date of implementation of the Commission’s
recommendation under section 212, submit to the
118
Congress draft legislation providing for the assimila-
tion into the BasiCare system of—
(A) the veterans health care program
under chapter 17 of title 38, United States
Code,
(B) the Civilian Health and Medical Pro-
gram of the Uniformed Services (CHAMPUS),
as defined in section 1073(4) of title 10, United
States Code,
(C) the Indian health service program
under the Indian Health Care Improvement Act
(25 U.S.C. 1601 et seq.), and
(D) the Federal employees program under
chapter 89 of title 5, United States Code.
The Commission shall include with such draft legis-
lation, an accompanying report detailing and ex-
plaining the provisions of such draft legislation.
(2) CONGRESSIONAL CONSIDERATION.—Propos-
als made to Congress under this subsection shall be
considered by Congress under the procedures for
consideration of an ‘‘approval resolution’’ as de-
scribed in subtitle D.
(3) PERIOD
FOR
RESUBMISSION
OF
PRO-
POSAL.—If the proposal of the Commission submit-
ted under this subsection is not approved by Con-
119
gress in a year, the Commission shall by not later
than January 1 of each year thereafter, for a period
not to exceed 2 years (unless such recommendation
is approved in a year) submit a new proposal to
Congress subject to the guidelines and requirements
of this title.
(k) OVERSIGHT OF SUCH UNCOMPENSATED CARE AS
MAY REMAIN.—To the extent it deems necessary, and to
the extent practicable, the Commission may provide to
Congress recommendations for the establishment of na-
tional or regional compensation pools, or other mecha-
nisms, for the payment of providers who furnish BasiCare-
covered services to individuals who, through choice or in-
advertence, fail to secure BasiCare coverage as provided
in this Act.
(l) MEDICAL EDUCATION ASSISTANCE.—In conjunc-
tion with the duties assigned to it under section 212 of
this Act, and in conjunction with its proposal to assimilate
the medicare program under title XVIII of the Social Se-
curity Act into BasiCare under subsection (i) of this sec-
tion, the Commission shall consider and develop methods
to assure support for academic health centers and the pro-
vision of quality training to health professionals.
(m) CERTIFICATION.—
120
(1) IN
GENERAL.—The Commission shall re-
quire that no health benefit plan may be offered by
a carrier under section 215 or by an employer under
section 217 or 219 on or after the effective date of
implementation of the Commission’s recommenda-
tion under this title, unless the plan has been cer-
tified by the Commission (in accordance with such
procedures as the Commission establishes) as quali-
fying as a BasiCare health benefit plan. The Com-
mission shall enter into an agreement with the appli-
cable regulatory authority of each State, or such
public or private nonprofit entities as the Commis-
sion deems necessary, to provide for the administra-
tion of such certification under this subsection.
(2) LOOK-BEHIND
AUTHORITY.—If the Com-
mission determines that a health benefit plan does
not qualify on or after the effective date specified in
paragraph (1), no coverage may be provided under
the plan to individuals not enrolled as of the date of
the determination, and the plan may not be contin-
ued for plan years beginning after the date of such
determination until the Commission determines that
such plan so qualifies.
(3) NONAPPLICATION
TO
SUPPLEMENTAL
IN-
SURANCE.—The provisions described in this sub-
121
section shall apply only to coverage for benefits
equivalent to the BasiCare health benefit plan and
do not apply to other health benefits.
(n) OVERSIGHT OF PRESCRIPTION DRUGS.—
(1) IN GENERAL.—No later than January 1 of
the second year following the effective date of imple-
mentation of the Commission’s recommendations
under this title, the Commission shall submit to
Congress a report regarding the advisability of Fed-
eral regulation of the costs of prescription drugs in
order to maintain the affordability of the BasiCare
benefits package. If the Commission’s recommenda-
tion is that such regulation is needed, the Commis-
sion shall prepare and submit to Congress draft leg-
islation to carry out the terms of such regulation as
it may deem necessary.
(2) CONGRESSIONAL CONSIDERATION.—Propos-
als made to Congress under this subsection shall be
considered by Congress under the procedures for
consideration of an ‘‘approval resolution’’ as de-
scribed in subtitle D.
SEC. 214. BASICARE BENEFITS PACKAGE.
(a) CRITERIA.—In preparing the BasiCare benefits
package described in section 212(a)(1), the Commission
shall, subject to the requirements of this title, develop and
122
recommend the BasiCare benefits package as it deems ap-
propriate, adhering to the goals and guidelines described
in this subtitle. The BasiCare benefits package developed
and recommended by the Commission shall at a minimum
provide for—
(1) basic hospitalization coverage;
(2) basic outpatient services;
(3) prescription drugs (subject to reasonable
cost-sharing);
(4) protection against catastrophic out-of-pock-
et costs;
(5) coverage against extraordinary long-term
care costs; and
(6) coverage for preventive care services of sig-
nificant proven and recognized value in averting se-
rious and costly medical conditions.
(b) UNIFORMITY.—
(1) IN GENERAL.—Subject to the exceptions de-
scribed in paragraph (2), the BasiCare benefits
package recommended by the Commission shall pro-
vide for uniform national deductibles, copayments,
and benefit applications and standards.
(2) LIMITED VARIATION ALLOWED.—In order
to accommodate systems for providing health care in
a managed system, the Commission may provide for
123
variations in the structure of BasiCare cost-sharing
requirements for such systems, but only to the ex-
tent such variations do not significantly compromise
the national uniformity of a single BasiCare benefits
package.
(c) FLEXIBILITY REGARDING LONG-TERM CARE.—
(1) MODIFIED BENEFIT PLAN FOR MEDICARE
BENEFICIARIES.—The Commission may include in
its proposal under section 212 provisions for the es-
tablishment of a modified BasiCare long-term care
benefits plan for persons currently enrolled in the
medicare program under title XVIII of the Social
Security Act. If the Commission includes such a
plan, the plan shall—
(A) consist only of long-term care benefits
included in the BasiCare benefits package, and
(B) be subject to the rules and require-
ments applicable to the BasiCare health benefit
plan under this title, except as may be modified
by the Commission in its proposal to Congress
under section 212.
(2) CONTINUITY
OF
LONG-TERM
CARE
COV-
ERAGE.—The Commission may include in its pro-
posal under section 212 such special provisions as it
124
may deem necessary to assure portability of coverage
consistent with the requirements of section 215.
(3) INTERACTION WITH OTHER PROGRAMS.—
The Commission may include such provisions as it
deems necessary to coordinate BasiCare long-term
care coverage with coverage provided under the med-
icare program under title XVIII of the Social Secu-
rity Act, and with coverage provided by the medicaid
program under title XIX of the Social Security Act,
as modified by the terms of this Act.
(d) PREFERENCE FOR COPAYMENTS IN COST-SHAR-
ING.—To the extent practicable, the Commission shall em-
ploy copayments rather than deductibles in providing for
such cost-sharing requirements as may be included in the
BasiCare benefits package under this section.
SEC. 
215. 
INSURANCE 
RESPONSIBILITIES 
UNDER
BASICARE.
(a) IN GENERAL.—In developing the legislative pro-
posal described in section 212(a)(2), the Commission shall
provide that the requirements of this section are incor-
porated as part of its recommendation for national health
care insurance reform.
(b) GENERAL REQUIREMENT.—Each carrier shall
offer the BasiCare health benefit plan as specified in this
section.
125
(c) PREEMPTION OF STATE MANDATED BENEFIT
LAWS.—To the extent that laws of any State or local gov-
ernment regulate or otherwise provide any requirement re-
lating to the benefits to be provided under contracts or
policies of insurance issued to, or under, a BasiCare health
benefit plan, such laws are preempted.
(d) NONDUPLICATION OF BASICARE.—Health bene-
fit plans may be issued for benefits other than those cov-
ered by the BasiCare benefits package described in section
214, but no health benefit plans may be offered by any
carrier in any State which duplicate, either in whole or
in part, the benefits described in the BasiCare benefits
package.
(e) NONDISCRIMINATION BASED ON HEALTH STA-
TUS.—
(1) IN
GENERAL.—BasiCare health benefit
plans offered by carriers may not deny, limit, or con-
dition the coverage under (or benefits of) the plan
based on the health status, claims experience, receipt
of health care, medical history, or lack of evidence
of insurability, of an individual.
(2) TREATMENT OF PREEXISTING CONDITION
EXCLUSIONS FOR ALL SERVICES.—BasiCare health
benefit plans provided by carriers may not exclude
or otherwise discourage coverage with respect to
126
services related to treatment of a preexisting condi-
tion.
(f) REGISTRATION WITH APPLICABLE REGULATORY
AUTHORITY.—
(1) IN GENERAL.—Each carrier shall register
with the applicable regulatory authority for each
State in which it issues or offers health benefit
plans.
(2) NO PREEMPTION OF STATE INFORMATION
REQUIREMENTS.—Nothing in paragraph (1) shall be
construed as preventing the applicable regulatory
authority from requiring, in the case of BasiCare
carriers that are not self-insurance carriers, such ad-
ditional information in conjunction with, or apart
from, the registration required under paragraph (1)
as the applicable regulatory authority may be au-
thorized to require under State law.
(g) GUARANTEED ISSUE.—
(1) IN
GENERAL.—Subject to the succeeding
provisions of this subsection, a carrier that offers a
BasiCare health benefit plan (including a reinsur-
ance plan) to groups or individuals located in a com-
munity must offer the same plan to any other group
or individual located in the community, and shall
participate in a program developed by the Commis-
127
sion for assigning high-risk groups or individuals
among all such carriers.
(2) TREATMENT OF HEALTH MAINTENANCE OR-
GANIZATIONS.—
(A) GEOGRAPHIC LIMITATIONS.—A health
maintenance organization may deny coverage
under a BasiCare health benefit plan to an in-
dividual or group whose members are located
outside the service area of the organization, but
only if such denial is applied uniformly without
regard to health status or insurability.
(B) SIZE LIMITS.—A health maintenance
organization may apply to the applicable regu-
latory authority to cease enrolling new groups
or individuals in its BasiCare health benefit
plan (or in a geographic area served by the
plan) if it can demonstrate that its financial or
administrative capacity to serve previously en-
rolled groups and individuals (and additional in-
dividuals who will be expected to enroll because
of affiliation with such previously enrolled
groups) will be impaired if it is required to en-
roll new groups or individuals.
(3) GROUNDS
FOR
REFUSAL
TO
ISSUE
OR
RENEW.—
128
(A) IN GENERAL.—A carrier may refuse to
issue or renew or terminate a BasiCare health
benefit plan under this part only for—
(i) nonpayment of premiums,
(ii) fraud or misrepresentation, and
(iii) failure to meet minimum partici-
pation rates (consistent with subparagraph
(B)).
(B) MINIMUM PARTICIPATION RATES.—A
carrier may require, with respect to an employ-
ment-related group BasiCare health benefit
plan, that a minimum percentage of full-time
employees eligible to enroll under the plan be
enrolled, so long as such percentage is enforced
uniformly for all employment groups of com-
parable size.
(h) MINIMUM PLAN PERIOD.—A carrier may not
offer, or issue a BasiCare health benefit plan with a term
of less than 12 months.
(i) GUARANTEED RENEWABILITY.—
(1) IN GENERAL.—
(A) GENERAL RULE.—Subject to the suc-
ceeding provisions of this subsection, a carrier
shall ensure that a BasiCare health benefit plan
issued to a group or individual be renewed, at
129
the option of the policyholder, unless the plan
is terminated for the reasons specified in sub-
section (h)(3) (A) or under subparagraph (B).
(B) TERMINATION OF BUSINESS.—A car-
rier need not renew a BasiCare health benefit
plan with respect to such a policyholder if the
carrier—
(i) is terminating provision of all
health insurance in the community; and
(ii) provides notice to the policyholder
covered under the plan of such termination
at least 90 days before the date of expira-
tion of the plan.
In the case of such a termination, the carrier
may not provide for issuance of any health ben-
efit plan in such community during the 5-year
period beginning on the date of termination of
such block of business.
(C) CONSTRUCTION
RESPECTING
ADDI-
TIONAL STATE DISCLOSURE REQUIREMENTS.—
Subparagraph (B)(ii) shall not be construed as
preventing the applicable regulatory authority
from specifying the information to be included
in the notice under such subparagraph or in re-
130
quiring such notice to be provided at an earlier
date.
(2) NOTICE AND SPECIFICATION OF RATES AND
ADMINISTRATIVE CHANGES.—
(A) NOTICE.—A carrier offering BasiCare
health benefit plans shall provide for notice, at
least 30 days before the date of expiration of
the health benefit plan, of the terms for renewal
of the plan. Except with respect to rates and
administrative changes, the terms of renewal
(including benefits) shall be the same as the
terms of issuance.
(B) RENEWAL RATES SAME AS ISSUANCE
RATES.—The carrier may change the terms for
such renewal, but the premium rates charged
with respect to such renewal shall be the same
as that for a new issue.
(C) RATES CANNOT CHANGE MORE OFTEN
THAN MONTHLY.—
(i) IN GENERAL.—A carrier may not
change the premium rates established with
respect to BasiCare health benefit plans
offered in a community more often than
monthly.
131
(ii) APPLICATION OF NEW RATES TO
SPECIFIC
PLANS.—With respect to a
BasiCare health benefit plan which be-
comes effective in a month, the carrier
shall ensure that the premium rate estab-
lished under clause (i) for that month shall
apply to such plan for all months during
the 12-month period beginning with that
month. In the case of a plan renewal which
is effective for a 12-month period begin-
ning with a month, the premium rate es-
tablished under clause (i) with respect to
that month shall apply to all months dur-
ing 12-month renewal period.
(3) PERIOD OF RENEWAL.—The period of re-
newal of each health benefit plan offered by a carrier
shall be for a period of not less than 12 months.
(j) COMMUNITY RATING.—
(1) IN GENERAL.—A carrier may not charge
premium rates for BasiCare health benefit plans in
excess of the average per capita cost of providing
such coverage to all individuals covered under
BasiCare policies issued by that carrier in a commu-
nity. A BasiCare health benefit plan meeting such
132
criteria will be considered ‘‘actuarially certified’’ for
purposes of this subsection.
(2) ACTUARIALLY
CERTIFIED
DEFINED.—A
BasiCare health benefit plan is considered to be ‘‘ac-
tuarially certified’’ if there is a written statement by
a member of the American Academy of Actuaries or
other individual acceptable to the applicable regu-
latory authority that a carrier is in compliance with
this section, based upon the individual’s examina-
tion, including a review of the appropriate records
and of the actuarial assumptions and methods uti-
lized by the carrier in establishing premium rates for
applicable health benefit plans.
(k) ADJUSTMENTS TO COMMUNITY RATING.—
(1) IN GENERAL.—A BasiCare health benefit
plan offered by a carrier to a group or individual
may provide for an adjustment to the average com-
munity rate based on the age of covered individuals.
Any such adjustment shall be applied by the carrier
consistently to all policyholders, and no other adjust-
ments shall be permitted.
(2) LIMITATION ON ADJUSTMENT.—
(A) IN GENERAL.—The adjustment under
paragraph (1) may not result, with respect to
BasiCare health benefit plans offered by car-
133
riers to groups and individuals in the same
community, in a premium rate for the most ex-
pensive age group exceeding the average com-
munity rate by more than the applicable per-
cent (as defined in subparagraph (B)).
(B) APPLICABLE PERCENT DEFINED.—In
subparagraph (A), the term ‘‘applicable per-
cent’’ means—
(i) for the first effective year, 50 per-
cent,
(ii) for the second effective year, 40
percent,
(iii) for the third effective year, 30
percent, and
(iv) for any subsequent year, 20 per-
cent.
(l) APPLICATION OF STANDARDS TO REINSURANCE
POLICIES.—The requirements of this section shall apply
to all reinsurance policies sold by an entity to a carrier
offering BasiCare health benefit plans through self-in-
sured employment-related health benefit plans.
(m) APPLICATION
OF BASICARE BASE PREMIUM
RATE.—For the first year of standardization of the
BasiCare health benefit plan under this Act, premiums
charged for BasiCare health benefit plans may not exceed
134
the BasiCare base premium rate, as provided in section
216.
(n) APPLICATION
OF
ALLOWED
RATE
OF
IN-
CREASE.—
(1) IN GENERAL.—A carrier may not charge
premiums with respect to BasiCare health benefit
plans in any calendar year which exceed the greater
of—
(A) the previous year’s rate plus the an-
nual allowable percentage rate of increase for
the year as provided in section 213; or
(B) the applicable base premium rate, as
provided in section 216, plus amounts cor-
responding to the cumulative total of annual al-
lowable percentage rates of increase up to the
current year.
(2) EXCEPTION.—Notwithstanding paragraph
(1)(B), in any single calendar year a carrier may not
increase its premium with respect to a BasiCare
health benefit plan by an amount exceeding 120 per-
cent of the national annual allowable percentage rate
of increase for that year, as provided in section 213.
(o) RISK-ADJUSTMENT STRUCTURE.—In preparing
its recommendation to Congress under section 212 of this
Act, the Commission shall provide guidelines for a risk-
135
adjustment structure under which all BasiCare health
benefit plans in a State are assigned a numerical risk
index based on risk-adjustment factors developed by the
Commission and based on such index low-risk carriers are
required to pay an assessment and high-risk carriers are
designated to receive a subsidy in order to balance the risk
of doing business in such State. The Commission shall ad-
minister such a risk-adjustment structure in any State in
which the applicable regulatory authority fails to do so.
SEC. 216. BASICARE BASE PREMIUM RATE.
(a) CRITERIA.—In developing the legislative proposal
described in section 212(a)(3), the BasiCare base pre-
mium rate established and recommended by the Commis-
sion shall be based on the anticipated average cost of pro-
viding the BasiCare benefits package to an average group
of beneficiaries (as determined by the Commission in con-
sultation with the Board).
(b) LIMITED VARIATION ALLOWED.—In establishing
the BasiCare base premium rate, the Commission may
propose limited variations in such rate to accommodate
geographic variables, or other variables as described in
paragraphs (1) and (2).
(1) GEOGRAPHIC VARIABLES.—In order to ac-
commodate differences in costs in delivering health
care in different geographical areas, the Commission
136
may provide for limited geographical variations in
the BasiCare base premium rate to the extent such
variations are—
(A) based on statistically verifiable dif-
ferences in the cost of providing the BasiCare
benefits package, and
(B) not provided for geographic areas
smaller than areas that encompass at least—
(i) one or more adjacent metropolitan
statistical areas (as defined by the Com-
mission, in consultation with the Bureau of
the Census); or
(ii) the total remaining area within a
State not otherwise included in a geo-
graphic area described under clause (i).
(2) OTHER VARIABLES.—If the Commission has
provided for variation in the BasiCare benefits pack-
age under paragraph (2) of section 214(b), the Com-
mission may provide for variations in the BasiCare
base premium rate to reflect such variations in the
benefit package, to the extent such variations meet
the criteria for allowing variations under paragraph
(2) of such section. Also, to the extent that adjust-
ments to community rating of BasiCare health bene-
fit plans are permitted under section 215(k), the
137
Commission may provide for corresponding variation
in the BasiCare base premium rate to reflect such
permitted adjustments. If variations are provided for
in the BasiCare base premium rate, such variations
shall be expressed in terms of percentage variation
from a single standard national rate.
SEC. 217. EMPLOYER RESPONSIBILITIES UNDER BASICARE.
In developing the legislative proposal described in sec-
tion 212(a)(4), the Commission shall require the following:
(1) NO
DISCRIMINATION
BASED
ON
HEALTH
STATUS FOR CERTAIN SERVICES.—An employment-
related BasiCare health benefit plan may not deny,
limit, or condition coverage based on the health sta-
tus, claims experience, receipt of health care, medi-
cal history, or lack of evidence of insurability, of an
individual.
(2) TREATMENT OF PREEXISTING CONDITION
EXCLUSIONS.—An 
employment-related 
BasiCare
health benefit plan may not exclude or otherwise dis-
courage coverage with respect to services related to
treatment of a preexisting condition.
(3) TREATMENT
OF
WAITING
PERIODS.—An
employment-related BasiCare health benefit plan
may not impose waiting periods of any length.
138
(4) NO
DISCRIMINATION
BASED
ON
INCOME
LEVEL.—An employment-related BasiCare health
benefit plan shall apply equally to employees of all
income levels.
(5) EQUAL CONTRIBUTION LEVELS.—The total
amount of an employer’s contribution to the cost of
coverage under an employment-related BasiCare
health benefit plan for employees with incomes less
than 200 percent of the income official poverty line
(as described in section 232(g)(1)) shall equal or ex-
ceed such total amount for employees with incomes
greater than 200 percent of such income official pov-
erty line.
SEC. 
218. 
INDIVIDUAL 
RESPONSIBILITIES 
UNDER
BASICARE.
Subject to the provisions of subsections (h) and (i)
of section 213, in developing the legislative proposal de-
scribed in section 212(a)(5), the Commission shall require
that to be eligible for benefits under a Federal program,
an individual seeking benefits under such program shall
certify to the administrator of such program that such in-
dividual and the dependents of such individual possess
BasiCare health insurance coverage that meets the appli-
cable minimum standards under this title. Except as may
be provided by the Commission under section 214(c)(1),
139
this section shall not apply to persons eligible for enroll-
ment in—
(1) the medicare program under title XVIII of
the Social Security Act,
(2) the veterans health care program under
chapter 17 of title 38, United States Code,
(3) the Civilian Health and Medical Program of
the Uniformed Services (CHAMPUS), as defined in
section 1073(4) of title 10, United States Code,
(4) the Indian health service program under the
Indian Health Care Improvement Act (25 U.S.C.
1601 et seq.), and
(5) the Federal employees program under chap-
ter 89 of title 5, United States Code.
SEC. 219. SELF-INSURED PLAN REQUIREMENTS.
(a) IN GENERAL.—In developing the legislative pro-
posal described in section 212(a)(6), the Commission shall
require that in order to obtain certification as a BasiCare
health benefit plan as provided in section 213(m), a self-
insured health benefit plan must demonstrate to the satis-
faction of the Commission that—
(1) the benefits and conditions of such plan (in-
cluding copayments and deductibles) are substan-
tially equivalent to those of a BasiCare health bene-
fit plan as provided under this Act;
140
(2) the self-insuring entity is adhering to non-
discrimination standards substantially equivalent to
those provided for carriers in section 215 (insurance
reform requirements) and described in subsection
(b);
(3) the average per capita cost of providing
BasiCare equivalent benefits to enrollees in the self-
insured plan differs no more than 10 percent (either
above or below) from the average per capita cost of
providing BasiCare benefits package to non-self-in-
sured beneficiaries in the community (or commu-
nities) in which the self-insured group is located
(without taking into account any reductions in costs
due to health promotion activities of the employer);
and
(4) the self-insuring entity possesses adequate
financial reserves, as determined by the Commission,
to assure the immediate and long-term solvency of
the entity and the benefits of individuals receiving
coverage through such entity.
(b) STANDARDS DESCRIBED.—Standards described
in this subsection shall include (but are not limited to)
the following:
(1) NO
DISCRIMINATION
BASED
ON
HEALTH
STATUS.—No self-insured BasiCare health benefit
141
plan may deny, limit, or condition the coverage
under (or benefits of) the plan with respect to health
status, claims experience, receipt of health care,
medical history, or lack of evidence of insurability,
of an individual or group.
(2) TREATMENT
OF
PREEXISTING
CONDI-
TIONS.—No self-insured BasiCare health benefit
plan may exclude or otherwise discourage coverage
with respect to services related to treatment of a
preexisting condition.
(3) 
WAITING
PERIODS.—No 
self-insured
BasiCare health benefit plan may impose waiting pe-
riods of any length.
SEC. 220. PROVIDER RESPONSIBILITIES UNDER BASICARE.
In developing the legislative proposal described in sec-
tion 212(a)(7), the Commission shall require as a condi-
tion of participation in the BasiCare health benefit plan
by any health care provider the acceptance by such pro-
vider of any payment by BasiCare as full payment for the
service performed.
SEC. 221. DEVELOPMENT OF STANDARDS FOR MANAGED
CARE PLANS.
(a) IN GENERAL.—In preparing the legislative pro-
posal described in section 212(a)(8), the Commission, tak-
ing into account recommendations of the Managed Care
142
Advisory Committee (as described in subsection (b)), shall
develop recommended standards that carriers offering
managed care plans should meet with respect to the bene-
fits, coverage, and delivery systems provided under such
plans. Such standards shall encompass the standards by
which managed care entities operate.
(b) MANAGED CARE ADVISORY COMMITTEE.—
(1) ESTABLISHMENT.—There shall be estab-
lished a Managed Care Advisory Committee (herein-
after referred to as the ‘‘Committee’’).
(2) MEMBERSHIP.—The Committee shall be
composed of 5 members appointed by the Chair-
person of the Commission, each member represent-
ing 1 of the following areas:
(A) Health care professionals.
(B) Managed care industry.
(C) Academia (with specific expertise in
managed care plans).
(D) Business management.
(E) Organized labor.
(3) COMPENSATION.—
(A) IN GENERAL.—Members of the Com-
mittee shall serve without compensation.
(B) EXPENSES, 
ETC., 
REIMBURSED.—
While away from their homes or regular places
143
of business on the business of the Committee,
the members may be allowed travel expenses,
including per diem in lieu of subsistence, as au-
thorized by section 5703 of title 5, United
States Code, for persons employed intermit-
tently in Government service.
(C) APPLICATION OF ACT.—The provisions
of the Federal Advisory Committee Act (5
U.S.C. App.) shall not apply with respect to the
Committee.
(D) SUPPORT.—The Commission shall
supply such necessary office facilities, office
supplies, support services, and related expenses
as necessary to carry out the functions of the
Committee.
SEC. 222. PREEMPTION OF PROVISIONS RELATING TO MAN-
AGED CARE.
In developing the legislative proposal described in sec-
tion 212(a)(8), the Commission shall provide that in the
case of a managed care plan meeting the recommended
standards under section 221 that is offered by a carrier,
the following provisions of law are preempted and may not
be enforced against the managed care plan with respect
to a carrier offering such plan:
144
(1) RESTRICTIONS ON REIMBURSEMENT RATES
OR
SELECTIVE
CONTRACTING.—Any law that re-
stricts the ability of the carrier to negotiate reim-
bursement rates with health care providers or to
contract selectively with one provider or a limited
number of providers.
(2) RESTRICTIONS
ON
DIFFERENTIAL
FINAN-
CIAL INCENTIVES.—Any law that limits the financial
incentives that the managed care plan may require
a beneficiary to pay when a non-plan provider is
used on a non-emergency basis.
(3) RESTRICTIONS
ON
UTILIZATION
REVIEW
METHODS.—
(A) IN GENERAL.—Any law that—
(i) prohibits utilization review of any
or all treatments and conditions;
(ii) requires that such review be made
by a resident of the State in which the
treatment is to be offered or by an individ-
ual licensed in such State, or by a physi-
cian in any particular specialty or with any
board certified specialty of the same medi-
cal specialty as the provider whose services
are being rendered;
145
(iii) requires the use of specified
standards of health care practice in such
review or requires the disclosure of the
specific criteria used in such review;
(iv) requires payments to providers for
the expenses of responding to utilization
review requests; or
(v) imposes liability for delays in per-
forming such review.
(B) CONSTRUCTION.—Nothing in subpara-
graph (A)(ii) shall be construed as prohibiting
a State from requiring that utilization review be
conducted by a licensed health care profes-
sional, or requiring that any appeal from such
a review be made by a licensed physician or by
a licensed physician in any particular specialty
or with any board certified specialty of the
same medical specialty as the provider whose
services are being rendered.
(4) RESTRICTIONS
ON
BENEFITS.—Any law
that mandates benefits under the managed care plan
that are greater than the benefits recommended
under the standards developed under section 221.
146
(5) ERISA.—Any provision of the Employee
Retirement Income Security Act to the extent incon-
sistent with the managed care plan.
Subtitle C—Low-Income Assistance
SEC. 231. TRANSFER FROM MEDICAID TO BASICARE.
(a) IN GENERAL.—In developing the legislative pro-
posal described in section 212(a)(9)(A), the Commission
shall provide for the orderly termination of medicaid pro-
gram coverage under title XIX of the Social Security Act,
to the extent that such coverage duplicates the BasiCare
benefits package.
(b) TRANSFER
OF COVERED INDIVIDUALS FROM
MEDICAID TO BASICARE.—Such proposal shall require
each State—
(1) to notify medicaid beneficiaries of the im-
pending transfer of coverage of such beneficiaries to
the BasiCare program not later than 1 year prior to
the date of transfer from medicaid to the BasiCare
program; and
(2) to provide such information and assistance
as may be necessary to assure the enrollment of all
medicaid beneficiaries in BasiCare health benefit
plans upon the establishment of such plans.
147
(c) PROVISIONAL TREATMENT OF MEDICAID BENE-
FITS NOT COVERED BY BASICARE.—Such proposal shall
require—
(1) that for a period of 5 years following the
termination of medicaid benefits that duplicate the
BasiCare benefits package, the medicaid program
shall continue to operate with respect to the provi-
sion of any existing benefits which are not covered
under the BasiCare benefits package; and
(2) Federal rules and regulations regarding the
medicaid program shall remain in effect during a
transition period subject to such adjustments
deemed necessary by the Commission to carry out
the medicaid-to-BasiCare transfer described in this
section.
(d) FINAL DISPOSITION OF MEDICAID BENEFITS.—
Upon expiration of the 5-year transition period described
in subsection (c)(1), Federal funding for any existing med-
icaid benefits which are not covered under the BasiCare
benefits package shall be discontinued, unless Congress
has approved a plan for alternate disposition of such bene-
fits, as provided in section 213.
148
SEC. 232. LOW-INCOME ASSISTANCE WITH COSTS OF
BASICARE INSURANCE.
(a) IN GENERAL.—In developing the legislative pro-
posal described in section 212(a)(9)(B), the Commission
shall provide for a BasiCare public assistance program
(hereafter in this section referred to as ‘‘BasiCare Assist’’)
which, at a minimum, meets the requirements of the fol-
lowing subsections of this section.
(b) ASSISTANCE FOR UNDER-POVERTY FAMILIES.—
In the case of an individual who is a member of an under-
poverty family, BasiCare Assist shall provide for payment
of—
(1) premiums charged the individual for cov-
erage under a BasiCare health benefit plan in which
the individual is enrolled; and
(2) deductibles and other cost-sharing imposed
on the individual under such plan, other than a per
service copayment, not to exceed $5 per service, as
determined by the Commission.
(c) ASSISTANCE FOR NEAR-POVERTY FAMILIES.—
(1) IN GENERAL.—In the case of an individual
who is a member of a near-poverty family, BasiCare
Assist shall provide for payment of the applicable
percentage of any premiums, deductibles, and other
cost-sharing charged the individual for coverage
149
under a BasiCare health benefit plan in which the
individual is enrolled.
(2) APPLICABLE PERCENTAGE.—For purposes
of paragraph (1), the term ‘‘applicable percentage’’
means 100 percent reduced (but not below zero per-
cent) by 10 percentage points for each 10 percent-
age point bracket (or portion thereof) such family’s
income equals or exceeds 100 percent of the income
official poverty line (as defined by the Office of Man-
agement and Budget, and revised annually in ac-
cordance with section 673(2) of the Omnibus Budget
Reconciliation Act of 1981) applicable to a family of
the size involved.
(d) ADJUSTMENT OF ASSISTANCE.—The Commission
shall provide for appropriate adjustments to any assist-
ance under this section to reflect partial family coverage
under an employment-related BasiCare health benefit
plan.
(e) APPLICATION FOR ASSISTANCE.—BasiCare Assist
shall use a standard Federal application which shall be
as simple in form as possible and understandable to the
average individual, and shall require attachment of such
documentation as deemed necessary by the Commission in
order to ensure eligibility for assistance. Such application
shall be available to any individual or family, may be filed
150
at any time, and as provided in subsection (f), may initiate
coverage under a BasiCare health benefit plan. The Com-
mission shall use, as deemed practicable by the Commis-
sion, any existing forms employed for Federal income tax
filings as an application for BasiCare Assist.
(f) ENROLLMENT AT POINT OF APPLICATION.—To
the extent practicable, the Commission shall provide for
the option of enrollment in a BasiCare health benefit plan
as part of the application and approval process for assist-
ance under this section. In providing for such an option,
the Commission may require carriers of BasiCare health
benefit plans to provide such information and assistance
as may be necessary.
(g) PAYMENT OF PREMIUMS, DEDUCTIBLES, AND
OTHER COST-SHARING.—BasiCare Assist shall provide to
an individual a voucher for the applicable percentage of
BasiCare premiums, deductibles, and other cost-sharing
for which such individual qualifies under subsection (b)
or (c). Such voucher shall be remitted by the individual
to the carrier of BasiCare health benefit plans (or, in the
case of an employment-related BasiCare health benefit
plan, to the individual’s employer) for payment by
BasiCare Assist. Such carrier shall make proper adjust-
ments in billing statements to reflect such individual’s re-
151
maining premium obligations, deductibles, and other cost-
sharing (if any).
(h) DOCUMENTATION OF ELIGIBILITY.—
(1) REQUIREMENT
FOR
FILING
OF
INCOME
STATEMENT.—In the case of a family which is re-
ceiving assistance under BasiCare Assist for any
month in a year, a member of the family shall file
a statement with the Commission, at such intervals
during such year as the Commission deems nec-
essary, and by not later than April 15 of the follow-
ing year. Such a statement shall provide information
necessary to determine the family income and the
number of family members in the family during the
year.
(2) RECONCILIATION OF ASSISTANCE BASED ON
ACTUAL INCOME.—Based on and using the income
reported in the statement filed under paragraph (1)
with respect to a family, the Commission shall com-
pute the amount of assistance that should have been
provided under BasiCare Assist with respect to the
family in the year involved and make proper adjust-
ments in future assistance. If the amount of such
assistance computed is—
(A) greater than the amount of assistance
provided, the Commission shall provide for pay-
152
ment to the family involved of an amount equal
to the amount of the deficit, or
(B) less than the amount of assistance
provided, the Commission shall require the fam-
ily to pay to the Federal Government (to the
credit of BasiCare Assist) an amount equal to
the amount of the excess payment.
(3) 
DISQUALIFICATION
FOR
FAILURE
TO
FILE.—In the case of any family that is required to
file an information statement under paragraph (1)
for a year and that fails to file such a statement by
the deadline specified by the Commission, no mem-
ber of the family shall be eligible for assistance
under this section after such deadline. The Commis-
sion shall waive the application of this paragraph if
the family establishes, to the satisfaction of the
Commission, good cause for the failure to file the
statement on a timely basis.
(4) PENALTIES FOR FALSE INFORMATION.—
(A) INTEREST FOR UNDERSTATEMENTS.—
Each individual who knowingly understates in-
come reported in an application for assistance
under BasiCare Assist or any statement de-
scribed in paragraph (1), or otherwise makes a
material misrepresentation of information in
153
such an application or statement shall be liable
to the Federal Government for excess payments
made based on such understatement or mis-
representation, and for interest on such excess
payments at a rate specified by the Commis-
sion.
(B) 
PENALTIES
FOR
MISREPRESEN-
TATION.—Each individual who knowingly mis-
represents material information in an applica-
tion for assistance under BasiCare Assist or
any statement described in paragraph (1) shall
be liable to the Federal Government for $1,000
or, if greater, 3 times the excess payments
made based on such misrepresentation.
(5) NOTICE OF REQUIREMENT.—The Commis-
sion shall provide for written notice, in March of
each year, of the requirement of paragraph (1) to
each 
family 
which 
received 
assistance 
under
BasiCare Assist in any month during the preceding
year and to which such requirement applies.
(6) TRANSMITTAL OF INFORMATION.—The Sec-
retary of the Treasury shall transmit annually to the
Commission such information relating to the total
income of individuals and families for the taxable
year ending in the previous year as may be nec-
154
essary to verify the reconciliation of assistance under
BasiCare Assist.
(i) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section—
(1) 
UNDER-POVERTY
FAMILY.—The 
term
‘‘under-poverty family’’ means a family whose in-
come is less than 100 percent of the income official
poverty line (as defined by the Office of Manage-
ment and Budget, and revised annually in accord-
ance with section 673(2) of the Omnibus Budget
Reconciliation Act of 1981) applicable to a family of
the size involved.
(2) NEAR-POVERTY FAMILY.—The term ‘‘near-
poverty family’’ means a family whose income equals
or exceeds 100 percent of the income official poverty
line (as described in paragraph (1)), but is less than
200 percent of such income official poverty line.
(3) DETERMINATIONS OF INCOME.—
(A) IN
GENERAL.—The term ‘‘income’’
means—
(i) adjusted gross income (as defined
in section 62(a) of the Internal Revenue
Code of 1986), determined without the ap-
plication of paragraphs (6) and (7) of such
155
section and without the application of sec-
tion 162(l) of such Code, plus
(ii) the amount of social security ben-
efits (described in section 86(d) of such
Code) which is not includable in gross in-
come under section 86 of such Code.
(B) FAMILY INCOME.—The term ‘‘family
income’’ means, with respect to an individual,
the sum of the income for the individual and all
the other family members.
(C) FAMILY SIZE.—The family size to be
applied under this section, with respect to fam-
ily income, is the number of individuals in-
cluded in the family for purposes of coverage of
a BasiCare health benefit plan.
(D) TIMING OF DETERMINATION.—Income
shall be determined in accordance with one of
the following methods, at the option of the ap-
plicant, for coverage under this section:
(i) Multiplying by a factor of 4 the
family income of the applicant for the 3-
month period immediately preceding the
month in which the application for assist-
ance under BasiCare is made.
156
(ii) Determining the family income of
the applicant for the month in which the
application for such assistance is made.
(j) EFFECTIVE DATE.—The provisions of this section
shall take effect on the effective date of the legislation de-
scribed in section 212(a) or 213(a) of this Act.
Subtitle D—Congressional Consid-
eration 
of 
Commission 
Rec-
ommendation
SEC. 241. RULES GOVERNING CONGRESSIONAL CONSIDER-
ATION.
(a) RULES OF HOUSE OF REPRESENTATIVES AND
SENATE.—This section is enacted by the Congress—
(1) as an exercise of the rulemaking power of
the House of Representatives and the Senate, re-
spectively, and as such is deemed a part of the rules
of each House, respectively, but applicable only with
respect to the procedure to be followed in that
House in the case of approval resolutions described
in subsection (b), and supersedes other rules only to
the extent that such rules are inconsistent therewith;
and
(2) with full recognition of the constitutional
right of either House to change the rules (so far as
relating to the procedure of that House) at any time,
157
in the same manner and to the same extent as in
the case of any other rule of that House.
(b) TERMS OF THE RESOLUTION.—For purposes of
section 212(b), the term ‘‘approval resolution’’ means only
a joint resolution of the two Houses of the Congress, pro-
viding in—
(1) the matter after the resolving clause of
which is as follows: ‘‘That the Congress approves the
recommendations of the Commission on National
Health Care Access and Reform as submitted by the
Commission on llllllllllllll’’,
the blank space being filled in with the appropriate
date; and
(2) the title of which is as follows: ‘‘Joint Reso-
lution approving the recommendation of the Com-
mission on National Health Care Access and Re-
form’’.
(c) INTRODUCTION AND REFERRAL.—On the day on
which the recommendation of the Commission is transmit-
ted to the House of Representatives and the Senate, an
approval resolution with respect to such recommendation
shall be introduced (by request) in the House of Rep-
resentatives by the Majority Leader of the House, for him-
self and the Minority Leader of the House, or by Members
of the House designated by the Majority Leader of the
159
(1) IN GENERAL.—Except as provided in para-
graph (2), if the committee or committees of either
House to which an approval resolution has been re-
ferred have not reported it at the close of the 45th
day after its introduction, such committee or com-
mittees shall be automatically discharged from fur-
ther consideration of the approval resolution and it
shall be placed on the appropriation calendar. A vote
on final passage of the approval resolution shall be
taken in each House on or before the close of the
45th day after the approval resolution is reported by
the committees or committee of that House to which
it was referred, or after such committee or commit-
tees have been discharged from further consideration
of the approval resolution. If prior to the passage by
one House of an approval resolution of that House,
that House receives the same approval resolution
from the other House then—
(A) the procedure in that House shall be
the same as if no approval resolution had been
received from the other House; but
(B) the vote on final passage shall be on
the approval resolution of the other House.
(2) COMPUTATION OF DAYS.—For purposes of
paragraph (1), in computing a number of days in ei-
160
ther House, there shall be excluded any day on
which the House is not in session.
(f) FLOOR CONSIDERATION IN THE HOUSE OF REP-
RESENTATIVES.—
(1) MOTION TO PROCEED.—A motion in the
House of Representatives to proceed to the consider-
ation of an approval resolution shall be highly privi-
leged and not debatable. An amendment to the mo-
tion shall not be in order, nor shall it be in order
to move to reconsider the vote by which the motion
is agreed to or disagreed to.
(2) DEBATE.—Debate in the House of Rep-
resentatives on an approval resolution shall be lim-
ited to not more than 20 hours, which shall be di-
vided equally between those favoring and those op-
posing the bill or resolution. A motion further to
limit debate shall not be debatable. It shall not be
in order to move to recommit an approval resolution
or to move to reconsider the vote by which an ap-
proval resolution is agreed to or disagreed to.
(3) MOTION TO POSTPONE.—Motions to post-
pone, made in the House of Representatives with re-
spect to the consideration of an approval resolution,
and motions to proceed to the consideration of other
business, shall be decided without debate.
161
(4) APPEALS.—All appeals from the decisions
of the Chair relating to the application of the Rules
of the House of Representatives to the procedure re-
lating to an approval resolution shall be decided
without debate.
(5) GENERAL RULES APPLY.—Except to the ex-
tent specifically provided in the preceding provisions
of this subsection, consideration of an approval reso-
lution shall be governed by the Rules of the House
of Representatives applicable to other bills and reso-
lutions in similar circumstances.
(g) FLOOR CONSIDERATION IN THE SENATE.—
(1) MOTION TO PROCEED.—A motion in the
Senate to proceed to the consideration of an ap-
proval resolution shall be privileged and not debat-
able. An amendment to the motion shall not be in
order, nor shall it be in order to move to reconsider
the vote by which the motion is agreed to or dis-
agreed to.
(2) GENERAL DEBATE.—Debate in the Senate
on an approval resolution, and all debatable motions
and appeals in connection therewith, shall be limited
to not more than 20 hours. The time shall be equally
divided between, and controlled by, the Majority
Leader and the Minority Leader or their designees.
162
(3) DEBATE OF MOTIONS AND APPEALS.—De-
bate in the Senate on any debatable motion or ap-
peal in connection with an approval resolution shall
be limited to not more than 1 hour, to be equally di-
vided between, and controlled by, the mover and the
manager of the approval resolution, except that in
the event the manager of the approval resolution is
in favor of any such motion or appeal, the time in
opposition thereto, shall be controlled by the Minor-
ity Leader or his designee. Such leaders, or either of
them, may, from time under their control on the
passage of an approval resolution, allot additional
time to any Senator during the consideration of any
debatable motion or appeal.
(4) OTHER MOTIONS.—A motion in the Senate
to further limit debate is not debatable. A motion to
recommit an approval resolution is not in order.
(h) POINT OF ORDER REQUIRING SUPERMAJORITY
FOR MODIFICATIONS TO RECOMMENDATION ONCE AP-
PROVED.—
(1) IN GENERAL.—It shall not be in order in
the House of Representatives or the Senate to con-
sider any amendment to the provisions of the
BasiCare Health Access and Reform Act except as
provided in paragraph (2).
163
(2) WAIVER.—The point of order described in
paragraph (1) may be waived or suspended in the
House of Representatives or the Senate only, by the
affirmative vote of three-fifths of the Members duly
chosen and sworn.
Subtitle E—Enforcement
Provisions
SEC. 251. ENFORCEMENT PROVISIONS FOR CARRIERS, PRO-
VIDERS, AND EMPLOYERS.
(a) IN GENERAL.—Chapter 47 of the Internal Reve-
nue Code of 1986 (relating to excise taxes on qualified
pension, etc. plans) is amended by striking section 5000
and section 5000A (as added by section 106) and inserting
the following new sections:
‘‘SEC. 5000. FAILURE OF CARRIERS WITH RESPECT TO
BASICARE INSURANCE.
‘‘(a) GENERAL RULE.—In the case of any carrier of-
fering any health benefit plan, there is hereby imposed a
tax on such carrier if such plan fails to qualify as a
Basicare health benefit plan.
‘‘(b) AMOUNT OF TAX.—
‘‘(1) IN GENERAL.—The amount of tax imposed
by subsection (a) by reason of 1 or more failures
during a taxable year shall be equal to 50 percent
of the gross premiums received during such taxable
164
year with respect to all health benefit plans issued
by the carrier on whom such tax is imposed.
‘‘(2) GROSS PREMIUMS.—For purposes of para-
graph (1), gross premiums shall include any consid-
eration received with respect to any health benefit
contract.
‘‘(3) CONTROLLED GROUPS.—For purposes of
paragraph (1)—
‘‘(A) CONTROLLED
GROUP
OF
CORPORA-
TIONS.—All corporations which are members of
the same controlled group of corporations shall
be treated as 1 carrier. For purposes of the pre-
ceding sentence, the term ‘controlled group of
corporations’ has the meaning given to such
term by section 1563(a), except that—
‘‘(i) ‘more than 50 percent’ shall be
substituted for ‘at least 80 percent’ each
place it appears in section 1563(a)(1), and
‘‘(ii) the determination shall be made
without regard to subsections (a)(4) and
(e)(3)(C) of section 1563.
‘‘(B) PARTNERSHIPS, PROPRIETORSHIPS,
ETC., WHICH ARE UNDER COMMON CONTROL.—
Under regulations prescribed by the Secretary,
all trades or businesses (whether or not incor-
165
porated) which are under common control shall
be treated as 1 carrier. The regulations pre-
scribed under this subparagraph shall be based
on principles similar to the principles which
apply in the case of subparagraph (A).
‘‘(c) LIMITATION ON TAX.—
‘‘(1) TAX NOT TO APPLY WHERE FAILURE NOT
DISCOVERED
EXERCISING
REASONABLE
DILI-
GENCE.—No tax shall be imposed by subsection (a)
with respect to any failure for which it is established
to the satisfaction of the Secretary that the carrier
on whom the tax is imposed did not know, and exer-
cising reasonable diligence would not have known,
that such failure existed.
‘‘(2) TAX
NOT
TO
APPLY
WHERE
FAILURES
CORRECTED WITHIN 30 DAYS.—No tax shall be im-
posed by subsection (a) with respect to any failure
if—
‘‘(A) such failure was due to reasonable
cause and not to willful neglect, and
‘‘(B) such failure is corrected during the
30-day period beginning on the 1st date any of
the carriers on whom the tax is imposed knew,
or exercising reasonable diligence would have
known, that such failure existed.
166
‘‘(3) WAIVER BY SECRETARY.—In the case of a
failure which is due to reasonable cause and not to
willful neglect, the Secretary may waive part or all
of the tax imposed by subsection (a) to the extent
that the payment of such tax would be excessive rel-
ative to the failure involved.
‘‘(d) COMPLIANCE DETERMINATION.—
‘‘(1) IN GENERAL.—The Commission on Na-
tional Health Care Access and Reform (hereafter in
this subsection referred to as the ‘Commission’ shall
determine whether any health benefit plan qualifies
as a BasiCare health benefit plan.
‘‘(2) STATE AGREEMENTS.—
‘‘(A) IN GENERAL.—The Commission may,
in its discretion, enter into an agreement with
any State to provide for the State to make the
initial determination described in paragraph
(1).
‘‘(B) STANDARDS.—An agreement may be
entered into under subparagraph (A) only if—
‘‘(i) the chief executive officer of the
State requests such agreement be entered
into,
‘‘(ii) the Commission determines that
the State agreement will apply to substan-
167
tially all health benefit plans issued in such
State, and
‘‘(iii) the Commission determines that
the application of the State agreement will
carry out the purposes of this section.
‘‘(3) TERMINATION.—The Commission shall
terminate any agreement if the Commission deter-
mines that the application of the State agreement
ceases to carry out the purposes of this section.
‘‘(e) DEFINITIONS.—For purposes of this section the
terms ‘health benefit plan’, ‘BasiCare health benefit plan’,
and ‘carrier’ shall have the same meanings given such
terms under section 271 of the BasiCare Health Access
and Cost Control Act.
‘‘SEC. 5000A. FAILURE OF PROVIDERS WITH RESPECT TO
BASICARE INSURANCE.
‘‘(a) GENERAL RULE.—There is hereby imposed a
tax on the failure of any person who provides any service
under a BasiCare health benefit plan to comply with the
requirements of section 220 of the BasiCare Health Ac-
cess and Cost Control Act.
‘‘(b) AMOUNT OF TAX.—
‘‘(1) IN GENERAL.—The amount of tax imposed
by subsection (a) by reason of 1 or more failures
during a taxable year shall be equal to 50 percent
168
of the gross income received during such taxable
year with respect to all services provided by the per-
son on whom such tax is imposed.
‘‘(2) CONTROLLED GROUPS.—For purposes of
paragraph (1)—
‘‘(A) CONTROLLED
GROUP
OF
CORPORA-
TIONS.—All corporations which are members of
the same controlled group of corporations shall
be treated as 1 person. For purposes of the pre-
ceding sentence, the term ‘controlled group of
corporations’ has the meaning given to such
term by section 1563(a), except that—
‘‘(i) ‘more than 50 percent’ shall be
substituted for ‘at least 80 percent’ each
place it appears in section 1563(a)(1), and
‘‘(ii) the determination shall be made
without regard to subsections (a)(4) and
(e)(3)(C) of section 1563.
‘‘(B) PARTNERSHIPS, PROPRIETORSHIPS,
ETC., WHICH ARE UNDER COMMON CONTROL.—
Under regulations prescribed by the Secretary,
all trades or business (whether or not incor-
porated) which are under common control shall
be treated as 1 person. The regulations pre-
scribed under this subparagraph shall be based
169
on principles similar to the principles which
apply in the case of subparagraph (A).
‘‘(c) LIMITATION ON TAX.—
‘‘(1) TAX NOT TO APPLY WHERE FAILURE NOT
DISCOVERED
EXERCISING
REASONABLE
DILI-
GENCE.—No tax shall be imposed by subsection (a)
with respect to any failure for which it is established
to the satisfaction of the Secretary that the person
on whom the tax is imposed did not know, and exer-
cising reasonable diligence would not have known,
that such failure existed.
‘‘(2) TAX
NOT
TO
APPLY
WHERE
FAILURES
CORRECTED WITHIN 30 DAYS.—No tax shall be im-
posed by subsection (a) with respect to any failure
if—
‘‘(A) such failure was due to reasonable
cause and not to willful neglect, and
‘‘(B) such failure is corrected during the
30-day period beginning on the 1st date any of
the persons on whom the tax is imposed knew,
or exercising reasonable diligence would have
known, that such failure existed.
‘‘(3) WAIVER BY SECRETARY.—In the case of a
failure which is due to reasonable cause and not to
willful neglect, the Secretary may waive part or all
170
of the tax imposed by subsection (a) to the extent
that the payment of such tax would be excessive rel-
ative to the failure involved.
‘‘(d) COMPLIANCE DETERMINATION.—
‘‘(1) IN GENERAL.—The Commission on Na-
tional Health Care Access and Reform (hereafter in
this subsection referred to as the ‘Commission’ shall
determine compliance with the requirements of sec-
tion 220 of the BasiCare Health Access and Cost
Control Act.
‘‘(2) STATE AGREEMENTS.—
‘‘(A) IN GENERAL.—The Commission may,
in its discretion, enter into an agreement with
any State to provide for the State to make the
initial determination described in paragraph
(1).
‘‘(B) STANDARDS.—An agreement may be
entered into under subparagraph (A) only if—
‘‘(i) the chief executive officer of the
State requests such agreement be entered
into,
‘‘(ii) the Commission determines that
the State agreement will apply to substan-
tially all providers of services under health
benefit plans issued in such State, and
171
‘‘(iii) the Commission determines that
the application of the State agreement will
carry out the purposes of this section.
‘‘(3) TERMINATION.—The Commission shall
terminate any agreement if the Commission deter-
mines that the application of the State agreement
ceases to carry out the purposes of this section.
‘‘(e) DEFINITIONS.—For purposes of this section the
terms ‘health benefit plan’ and ‘BasiCare health benefit
plan’ shall have the same meanings given such terms
under section 271 of the BasiCare Health Access and Cost
Control Act.
‘‘SEC. 5000B. FAILURE OF EMPLOYERS WITH RESPECT TO
BASICARE INSURANCE.
‘‘(a) GENERAL RULE.—There is hereby imposed a
tax on the failure of any person to comply with the re-
quirements of sections 217 and 219 of the BasiCare
Health Access and Cost Control Act with respect to any
full-time employee of the person.
‘‘(b) AMOUNT OF TAX.—
‘‘(1) IN GENERAL.—The amount of the tax im-
posed by subsection (a) on any failure with respect
to a full-time employee shall be $50 for each day in
the noncompliance period with respect to such fail-
ure.
172
‘‘(2) NONCOMPLIANCE PERIOD.—For purposes
of this section, the term ‘noncompliance period’
means, with respect to any failure, the period—
‘‘(A) beginning on the date such failure
first occurs, and
‘‘(B) ending on the date such failure is
corrected.
‘‘(3) CORRECTION.—A failure of a person to
comply with the requirements of sections 217 and
219 of the BasiCare Health Access and Cost Control
Act with respect to any full-time employee of the
person shall be treated as corrected if—
‘‘(A) such failure is retroactively undone to
the extent possible, and
‘‘(B) the employee is placed in a financial
position which is as good as such employee
would have been in had such failure not oc-
curred.
For purposes of applying subparagraph (B), the em-
ployee shall be treated as if the employee had elected
the most favorable coverage in light of the expenses
incurred since the failure first occurred.
‘‘(c) LIMITATIONS ON AMOUNT OF TAX.—
‘‘(1) TAX NOT TO APPLY WHERE FAILURE NOT
DISCOVERED
EXERCISING
REASONABLE
DILI-
173
GENCE.—No tax shall be imposed by subsection (a)
on any failure during any period for which it is es-
tablished to the satisfaction of the Secretary that
none of the persons referred to in subsection (d)
knew, or exercising reasonable diligence would have
known, that such failure existed.
‘‘(2) TAX NOT TO APPLY TO FAILURES COR-
RECTED WITHIN 30 DAYS.—No tax shall be imposed
by subsection (a) on any failure if—
‘‘(A) such failure was due to reasonable
cause and not to willful neglect, and
‘‘(B) such failure is corrected during the
30-day period beginning on the first date any of
the persons referred to in subsection (d) knew,
or exercising reasonable diligence would have
known, that such failure existed.
‘‘(3) WAIVER BY SECRETARY.—In the case of a
failure which is due to reasonable cause and not to
willful neglect, the Secretary may waive part or all
of the tax imposed by subsection (a) to the extent
that the payment of such tax would be excessive rel-
ative to the failure involved.
‘‘(d) LIABILITY FOR TAX.—
174
‘‘(1) IN GENERAL.—Except as otherwise pro-
vided in this subsection, the following shall be liable
for the tax imposed by subsection (a) on a failure:
‘‘(A) In the case of a BasiCare health ben-
efit plan other than a multiemployer plan, the
employer.
‘‘(B) In the case of a multiemployer plan,
the plan.
‘‘(C) Each person who is responsible (other
than in a capacity as an employee) for admin-
istering 
or 
providing 
benefits 
under 
the
BasiCare health benefit plan and whose act or
failure to act caused (in whole or in part) the
failure.
‘‘(2) SPECIAL RULES FOR PERSONS DESCRIBED
IN PARAGRAPH (1)(C).—A person described in sub-
paragraph (C) (and not in subparagraphs (A) and
(B)) of paragraph (1) shall be liable for the tax im-
posed by subsection (a) on any failure only if such
person assumed (under a legally enforceable written
agreement) responsibility for the performance of the
act to which the failure relates.
‘‘(e) DEFINITIONS.—For purposes of this section, the
terms ‘BasiCare health benefit plan’ and ‘full-time em-
ployee’ shall have the same meanings given such terms
175
under section 271 of the BasiCare Health Access and Cost
Control Act.’’.
(b) CLERICAL AMENDMENTS.—The table of sections
for such chapter 47 is amended by adding at the end
thereof the following new items:
‘‘Sec. 5000. Failure of carriers with respect to BasiCare insur-
ance.
‘‘Sec. 5000A. Failure of providers with respect to BasiCare insur-
ance.
‘‘Sec. 5000B. Failure of employers with respect to BasiCare in-
surance.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall take effect on the effective date of the
legislation described in section 212(a) or 213(a) of this
Act.
SEC. 252. ENFORCEMENT PROVISION FOR INDIVIDUALS.
(a) IN GENERAL.—Subsection (d) of section 151 of
the Internal Revenue Code of 1986 (relating to allowance
of deductions for personal exemptions) is amended by add-
ing at the end thereof the following new paragraph:
‘‘(5) EXEMPTION
AMOUNT
DISALLOWED
FOR
UNINSURED INDIVIDUALS.—The exemption amount
for any individual for such individual’s taxable year
shall be zero, unless the policy number of the
BasiCare health benefit plan (as defined in section
271 of the BasiCare Health Access and Cost Control
Act) for such individual is included in the return
176
claiming such exemption amount for such individ-
ual.’’.
(b) EFFECTIVE DATE.—The amendment made by
this section shall take effect on the effective date of the
legislation described in section 212(a) or 213(a) of this
Act.
Subtitle F—Financial Provisions
SEC. 261. BASICARE TRUST FUND.
(a) TRUST FUND ESTABLISHED.—There is hereby
created on the books of the Treasury of the United States
a trust fund to be known as the BasiCare Trust Fund
(hereafter in this section referred to as the ‘‘Trust
Fund’’). The Trust Fund shall consist of such gifts and
bequests as may be made and such amounts as may be
deposited in, appropriated to, or credited to such Trust
Fund as provided in this section.
(b) TRANSFER OF AMOUNTS EQUIVALENT TO CER-
TAIN TAXES.—
(1) IN
GENERAL.—There are hereby appro-
priated to the Trust Fund amounts equivalent to
100 percent of—
(A) 1 percent of the wages (as defined in
section 3121 of the Internal Revenue Code of
1986) paid on or after the first day of the cal-
endar year following the date of the enactment
177
of this Act, and reported to the Secretary of the
Treasury or the Secretary’s delegate pursuant
to subtitle F of the Internal Revenue Code of
1986, and
(B) 1 percent of the amount of self-em-
ployment income (as defined in section 1402 of
the Internal Revenue Code of 1986) reported to
the Secretary of the Treasury or the Secretary’s
delegate on tax returns under subtitle F of the
Internal Revenue Code of 1986 for any taxable
year beginning on or after the first day of the
calendar year following the date of the enact-
ment of this Act.
(2) PENALTIES.—There are hereby appro-
priated to the Trust Fund amounts equivalent to
100 percent of the taxes imposed under sections
5000, 5000A, and 5000B of the Internal Revenue
Code of 1986.
(3) ADDITIONAL REVENUES.—There are hereby
appropriated to the Trust Fund amounts equivalent
to the additional revenues received in the Treasury
as the result of the amendments made by section
262 of this Act.
(4) TRANSFERS
BASED
ON
ESTIMATES.—The
amounts appropriated by paragraphs (1), (2), and
178
(3) shall be transferred from time to time (not less
frequently than monthly) from the general fund in
the Treasury to the Trust Fund, such amounts to be
determined on the basis of estimates by the Sec-
retary of the Treasury of the taxes, specified in such
subparagraphs, paid to or deposited into the Treas-
ury; and proper adjustments shall be made in
amounts subsequently transferred to the extent prior
estimates were in excess of or were less than the
taxes specified in such subparagraphs.
(c) TRANSFER OF ADDITIONAL FUNDS.—
(1) STATE SHARE OF MEDICAID FUNDING.—
(A) IN GENERAL.—On a fiscal year basis,
each State shall remit to the Trust Fund the
State’s medicaid share for that fiscal year.
(B) STATE’S MEDICAID SHARE.—
(i) IN GENERAL.—With respect to any
fiscal year beginning after the applicable
effective date of the legislation described in
section 212(a) or 213(a) of this Act, a
State’s medicaid share shall equal the
amount such State expended under title
XIX of the Social Security Act for the fis-
cal year preceding such applicable effective
date for benefits equal to the BasiCare
179
benefits package, as determined by the
Commission, in consultation with the Sec-
retary of Health and Human Services and
State medicaid authorities. Such amount
shall be adjusted each fiscal year by the in-
crease in the Consumer Price Index (as de-
termined by the Department of Labor) for
the previous fiscal year.
(ii) AMOUNT UPON COMPLETE ASSIMI-
LATION OF MEDICAID.—The amount other-
wise determined under clause (i) for the
fiscal year beginning after the applicable
effective date of the legislation described in
section 213(h) of this Act shall be in-
creased by the amount such State ex-
pended under title XIX of the Social Secu-
rity Act for the fiscal year preceding such
applicable effective date.
(C) COMPLIANCE.—The requirements of
this paragraph shall be subject to the provisions
of section 1904 of the Social Security Act.
(2) FEDERAL SHARE OF MEDICAID FUNDING.—
There are hereby appropriated for each fiscal year
described in paragraph (1) the comparable Federal
share expended under title XIX of the Social Secu-
180
rity Act for such fiscal year, as adjusted under para-
graph (1)(B)(i).
(3) MEDICARE FUNDS.—All amounts, not oth-
erwise obligated, that remain in the Federal Hos-
pital Insurance Trust Fund and the Federal Supple-
mental Medical Insurance Trust Fund on the appli-
cable effective date of the legislation described in
section 213(i) of this Act shall be transferred to the
Trust Fund.
(4) ADDITIONAL FEDERAL FUNDS.—There are
hereby appropriated to the Trust Fund for each fis-
cal year beginning after the applicable effective date
of the legislation described in 213(j) of this Act,
amounts equal to the amounts appropriated with re-
spect to—
(A) the veterans health care program
under chapter 17 of title 38, United States
Code,
(B) the Civilian Health and Medical Pro-
gram of the Uniformed Services (CHAMPUS),
as defined in section 1073(4) of title 10, United
States Code,
(C) the Indian health service program
under the Indian Health Care Improvement Act
(25 U.S.C. 1601 et seq.), and
181
(D) the Federal employees program under
chapter 89 of title 5, United States Code,
as in effect on the day before such applicable effec-
tive date, as adjusted under paragraph (1)(B)(i).
(5) APPROPRIATION OF ADDITIONAL SUMS.—
There are hereby authorized to be appropriated to
the Trust Fund such additional sums as may be re-
quired to make expenditures referred to in sub-
section (e).
(e) EXPENDITURES.—
(1) LOW-INCOME ASSISTANCE.—There are here-
by authorized and appropriated such sums as are
necessary in each fiscal year for the expenses of the
program described in section 241.
(2) ADMINISTRATIVE
EXPENSES.—There are
hereby appropriated such sums as are authorized
under section 203 for the administrative and other
expenses of the Commission for each fiscal year.
(3) TITLE I EXPENDITURES.—Amounts in the
Trust Fund shall be available, as provided in appro-
priation Acts, for authorized expenditures described
in—
(A) sections 330A(h) and 330B(h) of the
Public Health Service Act, as added by sections
111 and 112 of this Act, and
182
(B) sections 150 and 151(g) of this Act.
(e) INVESTMENT OF TRUST FUND.—
(1) IN GENERAL.—It shall be the duty of the
Secretary of the Treasury to invest such portion of
the Trust Fund as is not, in the Secretary’s judg-
ment, required to meet current withdrawals. Such
investments may be made only in interest-bearing
obligations of the United States or in obligations
guaranteed as to both principal and interest by the
United States. For such purpose, such obligations
may be acquired—
(A) on original issue at the issue price, or
(B) by purchase of outstanding obligations
at the market price.
The purposes for which obligations of the United
States may be issued under chapter 31 of title 31,
of the United States Code, are hereby extended to
authorize the issuance at par of special obligations
exclusively to the Trust Fund. Such special obliga-
tions shall bear interest at a rate equal to the aver-
age rate of interest, computed as to the end of the
calendar month next preceding the date of such
issue, borne by all marketable interest-bearing obli-
gations of the United States then forming a part of
the Public Debt; except that where such average rate
183
is not a multiple of one-eighth of 1 percent, the rate
of interest of such special obligations shall be the
multiple of one-eighth of 1 percent next lower than
such average rate. Such special obligations shall be
issued only if the Secretary of the Treasury deter-
mines that the purchase of other interest-bearing ob-
ligations of the United States, or of obligations
guaranteed as to both principal and interest by the
United States on original issue or at the market
price, is not in the public interest.
(2) SALE OF OBLIGATION.—Any obligation ac-
quired by the Trust Fund (except special obligations
issued exclusively to the Trust Fund) may be sold by
the Secretary of the Treasury at the market price,
and such special obligations may be redeemed at par
plus accrued interest.
(3) CREDITS TO TRUST FUND.—The interest
on, and the proceeds from the sale or redemption of,
any obligations held in the Trust Fund shall be
credited to and form a part of the Trust Fund.
(f) REPORT TO CONGRESS.—It shall be the duty of
the Secretary of the Treasury to hold the Trust Fund,
and (after consultation with the Commission) to report to
the Congress each year on the financial condition and the
results of the operations of the Trust Fund during the
184
preceding fiscal year and on its expected condition and op-
erations during the next fiscal year. Such report shall be
printed as both a House and Senate document of the ses-
sion of the Congress to which the report is made.
(g) CONFORMING AMENDMENT.—Paragraph (4) of
section 201(a) of the Social Security Act (42 U.S.C.
401(a)) is amended by inserting ‘‘and section 261(1)(1)
of the BasiCare Health Access and Cost Control Act’’ be-
fore the end period.
SEC. 262. TAX TREATMENT OF COSTS OF BASICARE INSUR-
ANCE.
(a) TAX EXCLUSIONS
FOR EMPLOYER-PROVIDED
HEALTH INSURANCE.—Section 106 of the Internal Reve-
nue Code of 1986 (relating to contributions by employer
to accident and health plans) is amended by striking ‘‘an
accident or health plan’’ and inserting ‘‘a BasiCare health
benefit plan (as defined in section 271(1) of the BasiCare
Health Access and Cost Control Act)’’.
(b) BUSINESS EXPENSE DEDUCTION FOR HEALTH
INSURANCE.—Section 162 of the Internal Revenue Code
of 1986 (relating to trade or business expenses) is amend-
ed by redesignating subsection (m) as subsection (n) and
by inserting after subsection (l) the following new sub-
section:
185
‘‘(m) GROUP HEALTH PLANS.—The expenses paid or
incurred by an employer for a group health plan shall not
be allowed as a deduction under this section unless the
plan qualifies as a BasiCare health benefit plan (as de-
fined in section 271(1) of the BasiCare Health Access and
Cost Control Act).’’.
(c) RULES RELATING TO DEDUCTIONS FOR INDIVID-
UALS.—
(1) DEDUCTION LIMITED TO BASICARE.—Sub-
paragraph (C) of section 213(d)(1) of such Code
(defining medical care) is amended by striking ‘‘for
insurance’’ and inserting ‘‘for a BasiCare health
benefit plan (as defined in section 271(1) of the
BasiCare Health Access and Cost Control Act).’’.
(2) FULL DEDUCTION ALLOWED.—Section 213
of such Code (relating to medical, dental, etc., ex-
penses) is amended by adding at the end the follow-
ing new subsection:
‘‘(g) SPECIAL RULES FOR BASICARE PREMIUM EX-
PENSES.—
‘‘(1) IN GENERAL.—The deduction under sub-
section (a) shall be determined without regard to the
limitation based on adjusted gross income with re-
spect to amounts paid for premiums for coverage
under a Basicare health benefit plan (as defined in
186
section 271(1) of the BasiCare Health Access and
Cost Control Act).
‘‘(2) LIMIT.—The amount allowed as a deduc-
tion under paragraph (1) with respect to the cost of
providing coverage for any individual shall be re-
duced by the aggregate amount of payments to, or
on behalf of, such individual by—
‘‘(A) BasiCare Assist under section 232 of
the BasiCare Health Access and Cost Control
Act, and
‘‘(B) all other entities (including any em-
ployer or governmental agency),
for coverage of such individual under a BasiCare
health benefit plan (as so defined).’’
(3) DEDUCTION ALLOWED AGAINST GROSS IN-
COME.—Section 62(a) of such Code (defining ad-
justed gross income) is amended by inserting after
paragraph (14) the following new paragraph:
‘‘(15) DEDUCTION FOR BASICARE PREMIUMS.—
The deduction allowed under section 213(g).’’
(d) EFFECTIVE DATE.—The amendments made by
this section shall apply with respect to any taxable year
beginning after the applicable effective date of the legisla-
tion described in section 212(a) or 213(a) of this Act.
187
Subtitle G—Definitions
SEC. 271. DEFINITIONS.
For purposes of this title:
(1) BASICARE
HEALTH
BENEFIT
PLAN.—The
term ‘‘BasiCare health benefit plan’’ means a health
benefit plan which—
(A) offers the BasiCare benefits package
described in section 214;
(B) applies the BasiCare base premium
rate described in section 216; and
(C) meets the requirements of this title.
(2) HEALTH BENEFIT PLAN AND OTHER DEFI-
NITIONS RELATING TO HEALTH PLANS.—For pur-
poses of this section:
(A) HEALTH BENEFIT PLAN.—
(i) IN GENERAL.—The term ‘‘health
benefit plan’’ means any hospital or medi-
cal expense incurred policy or certificate,
hospital or medical service plan contract,
health maintenance subscriber contract,
other employee welfare plan (as defined in
the Employee Retirement Income Security
Act of 1964), or any other health insur-
ance arrangement, and includes an employ-
188
ment-related reinsurance plan (as defined
in paragraph (3)).
(ii) EXCLUSIONS.—The term ‘health
benefit plan’ does not include—
(I) accident-only, credit, dental,
or disability income insurance,
(II) coverage issued as a supple-
ment to liability insurance,
(III) worker’s compensation or
similar insurance, or
(IV) automobile medical-payment
insurance;
that is offered by a carrier.
(B) REINSURANCE PLAN.—The term ‘‘re-
insurance plan’’ means any reinsurance or simi-
lar mechanism that underwrites a portion of the
risk for a health benefit plan.
(C) 
SELF-INSURED
HEALTH
BENEFIT
PLAN.—The term ‘‘self-insured health benefit
plan’’ means a health benefit plan in which an
employment-related group assumes the under-
writing risk for the plan (whether or not there
is any reinsurance or similar mechanism to un-
derwrite a portion of that risk).
189
(3) CARRIER; HEALTH MAINTENANCE ORGANI-
ZATION; AND
OTHER
DEFINITIONS
RELATING
TO
CARRIERS.—For purposes of this title:
(A) CARRIER.—The term ‘‘carrier’’ means
any person that offers a health benefit plan,
whether through insurance or otherwise, includ-
ing a licensed insurance company, a prepaid
hospital or medical service plan, a health main-
tenance organization, a self-insurer carrier, a
reinsurance carrier, and a multiple small em-
ployer welfare arrangement (a combination of
small employers associated for the purpose of
providing health benefit plan coverage for their
employees).
(B) HEALTH
MAINTENANCE
ORGANIZA-
TION.—The term ‘‘health maintenance organi-
zation’’ has the meaning given the term ‘eligible
organization’ in section 1876(b) of the Social
Security Act, as in effect on the date of enact-
ment of this Act.
(C) REINSURANCE
CARRIER.—The term
‘‘reinsurance carrier’’ means the entity assum-
ing responsibility for underwriting under an
employment-related reinsurance plan, but does
190
not include a carrier insofar as it directly offers
a health benefit plan.
(D) SELF-INSURER
CARRIER.—The term
‘‘self-insurer carrier’’ means a carrier that is
not a licensed insurance company, a prepaid
hospital or medical service plan, or a health
maintenance organization, that offers a health
benefit plan directly with respect to an employ-
ment-related group.
(4) GENERAL DEFINITIONS.—For purposes of
this title:
(A) APPLICABLE
REGULATORY
AUTHOR-
ITY.—The term ‘‘applicable regulatory author-
ity’’ means, with respect to a health benefit
plan offered in a State, the State commissioner
or superintendent of insurance or other State
authority responsible for regulation of health in-
surance.
(B) COMMUNITY.—The term ‘‘community’’
means a geographic area that encompasses at
least—
(i) one or more adjacent metropolitan
statistical areas (as defined by the Com-
mission, in consultation with the Bureau of
the Census); or
191
(ii) the total remaining area within a
State not otherwise included in a geo-
graphic area described under clause (i).
(C) FULL-TIME
EMPLOYEE.—The term
‘‘full-time employee’’ means, with respect to an
employer, an employee who normally performs
on a monthly basis at least 30 hours of service
per week for such employer.
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