II
Calendar No. 261
105TH CONGRESS
1ST SESSION
H. R. 497
IN THE SENATE OF THE UNITED STATES
FEBRUARY 27, 1997
Received
MARCH 12, 1997
Read twice and referred to the Committee on Governmental Affairs
NOVEMBER 6, 1997
Reported by Mr. THOMPSON, with an amendment and an amendment to the
title
[Strike out all after the enacting clause and insert the part printed in italic]
AN ACT
To repeal the Federal charter of Group Hospitalization and
Medical Services, Inc., and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. REPEAL OF FEDERAL CHARTER OF GROUP
HOSPITALIZATION AND MEDICAL SERVICES,
INC.
(a) REPEAL OF FEDERAL CHARTER.—
(1) IN GENERAL.—The Act entitled ‘‘An Act
providing for the incorporation of certain persons as
Group Hospitalization, Inc.’’, approved August 11,
1939 (53 Stat. 1412), is repealed.
(2) AUTHORIZATION TO FILE ARTICLES OF IN-
CORPORATION.—Group Hospitalization and Medical
Services, Inc. is hereby authorized to file articles of
incorporation under the District of Columbia Non-
profit Corporation Act.
(3) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall take effect upon the filing
and effectiveness of articles of incorporation of
Group Hospitalization and Medical Services, Inc.
under the District of Columbia Nonprofit Corpora-
tion Act.
(b) EFFECTS OF BECOMING A DISTRICT OF COLUM-
BIA NONPROFIT CORPORATION.—Effective upon the filing
and effectiveness of articles of incorporation of Group
Hospitalization and Medical Services, Inc. as authorized
in paragraph (2) of subsection (a), Group Hospitalization
and Medical Services, Inc.—
(1) shall be a District of Columbia nonprofit
corporation subject to the articles of incorporation;
(2) shall be deemed organized and existing
under the District of Columbia Nonprofit Corpora-
tion Act, notwithstanding any of the provisions of
section 4 of the District of Columbia Nonprofit Cor-
poration Act regarding organizations subject to any
of the provisions of the insurance laws of the Dis-
trict of Columbia;
(3) shall be legally domiciled in the District of
Columbia;
(4) shall be regulated by the Superintendent of
Insurance of the District of Columbia in accordance
with the laws and regulations of the District of Co-
lumbia;
(5) shall continue to exist; and
(6) shall continue to be authorized to transact
business—
(A) under existing certificates of authority
and licenses issued to Group Hospitalization
and Medical Services, Inc. before such filing
and effectiveness,
(B) under the name ‘‘Group Hospitaliza-
tion and Medical Services, Inc.’’, and
(C) under applicable laws and regulations.
SEC. 2. WAIVER OF CONGRESSIONAL REVIEW PERIOD.
Notwithstanding section 602(c)(1) of the District of
Columbia Self-Government and Governmental Reorganiza-
tion Act (sec. 1–233(c)(1), D.C. Code), the Hospital and
Medical Services Corporation Regulatory Act of 1996
(D.C. Act 11–505) shall take effect on the date of the
enactment of such Act or the date of the enactment of
this Act, whichever is later.
SECTION 1. CHARTER FOR GROUP HOSPITALIZATION AND
MEDICAL SERVICES, INC.
The Act entitled ‘‘An Act providing for the incorpora-
tion of certain persons as Group Hospitalization and Medi-
cal Services, Inc.’’, approved August 11, 1939, is amend-
ed—
(1) by inserting after section 9 the following new
section:
‘‘SEC. 10. The corporation may have 1 class of mem-
bers, consisting of at least 1 member and not more than
30 members, as determined appropriate by the board of
trustees. The bylaws for the corporation shall prescribe the
designation of such class as well as the rights, privileges
and qualifications of such class, which may include, but
shall not be limited to—
‘‘(1) the manner of election, appointment or re-
moval of a member of the corporation;
‘‘(2) matters on which a member of the corpora-
tion has the right to vote; and
‘‘(3) meeting, notice, quorum, voting and proxy
requirements and procedures.
If a member of the corporation is a corporation, such mem-
ber shall be a nonprofit corporation.’’;
(2) by redesignating section 10 as section 11;
and
(3) by adding at the end of section 11 (as so re-
designated) the following: ‘‘The corporation may not
be dissolved without approval by Congress.’’.
SEC. 2. CONSISTENT COVERAGE FOR INDIVIDUALS EN-
ROLLED IN A HEALTH PLAN ADMINISTERED
BY THE FEDERAL BANKING AGENCIES.
(a) ENROLLMENT IN CHAPTER 89 PLAN.—For pur-
poses of chapter 89 of title 5, United States Code, any pe-
riod of enrollment shall be deemed to be a period of enroll-
ment in a health benefits plan under chapter 89 of such
title, if such enrollment is—
(1) in a health benefits plan administered by the
Federal Deposit Insurance Corporation before the ter-
mination of such plan on January 3, 1998; or
(2) subject to subsection (c), in a health benefits
plan (not under chapter 89 of such title) with respect
to which the eligibility of any employees or retired
employees of the Board of Governors of the Federal
Reserve System terminates on January 3, 1998.
(b) ENROLLMENT; CONTINUED COVERAGE.—
(1) ENROLLMENT.—Subject to subsection (c),
any individual who, on January 3, 1998, is enrolled
in a health benefits plan described in paragraph (1)
or (2) of subsection (a) may enroll in an approved
health benefits plan under chapter 89 of title 5, Unit-
ed States Code, either as an individual or for self and
family, if, after taking into account the provisions of
subsection (a), such individual—
(A) meets the requirements of that chapter
89 for eligibility to become so enrolled as an em-
ployee, annuitant, or former spouse (within the
meaning of that chapter); or
(B) would meet the requirements of that
chapter 89 if, to the extent such requirements in-
volve either retirement system under such title 5,
such individual satisfies similar requirements or
provisions of the Retirement Plan for Employees
of the Federal Reserve System.
(2) 
DETERMINATIONS.—Any 
determination
under paragraph (1)(B) shall be made under guide-
lines established by the Office of Personnel Manage-
ment in consultation with the Board of Governors of
the Federal Reserve System.
(3) CONTINUED
COVERAGE.—Subject to sub-
section (c), any individual who, on January 3, 1998,
is entitled to continued coverage under a health bene-
fits plan described in paragraph (1) or (2) of sub-
section (a) shall be deemed to be entitled to continued
coverage under section 8905a of title 5, United States
Code, but only for the same remaining period as
would have been allowable under the health benefits
plan in which such individual was enrolled on Janu-
ary 3, 1998, if—
(A) the individual had remained enrolled in
that plan; and
(B) that plan did not terminate, or the eli-
gibility of such individual with respect to that
plan did not terminate, as described in sub-
section (a).
(4) COMPARABLE TREATMENT.—Subject to sub-
section (c), any individual (other than an individual
under paragraph (3)) who, on January 3, 1998, is
covered under a health benefits plan described in
paragraph (1) or (2) of subsection (a) as an unmar-
ried dependent child, but who does not then qualify
for coverage under chapter 89 of title 5, United States
Code, as a family member (within the meaning of
that chapter) shall be deemed to be entitled to contin-
ued coverage under section 8905a of that title, to the
same extent and in the same manner as if such indi-
vidual had, on January 3, 1998, ceased to meet the
requirements for being considered an unmarried de-
pendent child of an enrollee under such chapter.
(5) EFFECTIVE DATE.—Coverage under chapter
89 of title 5, United States Code, pursuant to an en-
rollment under this section shall become effective on
January 4, 1998.
(c) ELIGIBILITY FOR FEHBP LIMITED TO INDIVID-
UALS
LOSING
ELIGIBILITY
UNDER
FORMER
HEALTH
PLAN.—Nothing in subsection (a)(2) or any paragraph of
subsection (b) (to the extent that paragraph (2) relates to
the plan described in subsection (a)(2)) shall be considered
to apply with respect to any individual whose eligibility
for coverage under the plan does not involuntarily termi-
nate on January 3, 1998.
(d) TRANSFERS TO THE EMPLOYEES HEALTH BENE-
FITS FUND.—The Federal Deposit Insurance Corporation
and the Board of Governors of the Federal Reserve System
shall transfer to the Employees Health Benefits Fund,
under section 8909 of title 5, United States Code, amounts
determined by the Director of the Office of Personnel Man-
agement, after consultation with the Federal Deposit Insur-
ance Corporation and the Board of Governors of the Federal
Reserve System, to be necessary to reimburse the Fund for
the cost of providing benefits under this section not other-
wise paid for by the individuals covered by this section.
The amounts so transferred shall be held in the Fund and
used by the Office of Personnel Management in addition
to amounts available under section 8906(g)(1) of title 5,
United States Code.
(e) ADMINISTRATION AND REGULATIONS.—The Office
of Personnel Management—
(1) shall administer the provisions of this section
to provide for—
(A) a period of notice and open enrollment
for individuals affected by this section; and
(B) no lapse of health coverage for individ-
uals who enroll in a health benefits plan under
chapter 89 of title 5, United States Code, in ac-
cordance with this section; and
(2) may prescribe regulations to implement this
section.
Amend the title so as to read: ‘‘An Act to amend the
Federal charter for Group Hospitalization and Medical
Services, Inc., and for other purposes.’’.
Passed the House of Representatives February 26,
1997.
Attest:
ROBIN H. CARLE,
Clerk.