SECTION 1. REPEAL OF INCENTIVE PAYMENTS FOR REDUC-
TION IN NUMBER OF GRADUATE MEDICAL
EDUCATION RESIDENTS.
(a) IN GENERAL.—Paragraph (6) of section 1886(h)
of the Social Security Act (42 U.S.C. 1395ww(h)), as
added by section 4626(a) of the Balanced Budget Act of
1997 (Public Law 105–33), is repealed.
(b) APPLICATION TO NEW YORK DEMONSTRATION
PROJECT; ELIMINATION
OF ANY PAYMENT AUTHOR-
ITY.—Section 4626 of the Balanced Budget Act of 1997
is amended—
(1) by amending subsection (b) to read as fol-
lows:
‘‘(b) ELIMINATION OF PAYMENT AUTHORITY.—
‘‘(1) The Secretary of Health and Human Serv-
ices is not authorized to approve or provide any pay-
ments for any demonstration project described in
paragraph (2) for any residency training year begin-
ning on or after July 1, 1998.
‘‘(2) A demonstration project described in this
paragraph is a project that primarily provides for
additional payments under title XVIII of the Social
Security Act in connection with a reduction in the
number of residents in a medical residency training
program.’’; and
(2) by striking subsection (c).
SEC. 2. PAYMENT OFFSETS.
(a) NO RETROACTIVE APPLICATION OF ESRD SEC-
ONDARY PAYER INTERPRETATION.—Notwithstanding any
other provision of law, the April 1995 interpretation of
section 1862(b)(1)(C) of the Social Security Act (42
U.S.C. 1395y(b)(1)(C)) issued by the Health Care Fi-
nancing Administration shall not apply retroactively to a
group health plan that paid benefits primary to title XVIII
of such Act (42 U.S.C. 1395 et seq.) (but would have paid
benefits secondary to such title in the absence of such sec-
tion) on or after August 10, 1993, and before April 24,
1995, on behalf of an individual who, during such pe-
riod—
(1) was entitled to benefits under such title
under subsection (a) or (b) of section 226 of such
Act (42 U.S.C. 426); and
(2) subsequently became entitled or eligible for
benefits under such title under section 226A of such
Act (42 U.S.C. 426–1).
(b) EXTENDING COBRA CONTINUATION COVERAGE
FOR END STAGE RENAL DISEASE MEDICARE BENE-
FICIARIES FOR 36 Months.—
(1) AMENDMENTS TO THE INTERNAL REVENUE
CODE OF 1986.—Section 4980B(f)(2)(B)(iv) of the
Internal Revenue Code of 1986 is amended—
(A) by striking ‘‘or’’ at the end of sub-
clause (I),
(B) in subclause (II), by inserting ‘‘other
than under section 226A of such Act’’ after
‘‘Social Security Act’’,
(C) by striking the period at the end of
subclause (II) and inserting ‘‘, or’’, and
(D) by adding at the end the following:
‘‘(III) in the case of a qualified
beneficiary other than a qualified ben-
eficiary 
described 
in 
subsection
(g)(1)(D) entitled to benefits under
title XVIII of the Social Security Act
under section 226A of such Act for a
period of 36 months.’’.
(2) 
AMENDMENTS
TO
ERISA.—Section
602(2)(D) of the Employee Retirement Income Se-
curity Act of 1974 (29 U.S.C. 1162(2)(D)) is
amended—
(A) by striking ‘‘or’’ at the end of clause
(i),
(B) in clause (ii), by inserting ‘‘other than
under section 226A of such Act’’ after ‘‘Social
Security Act’’,
(C) by striking the period at the end of
clause (ii) and inserting ‘‘, or’’, and
(D) by adding at the end the following:
‘‘(iii) in the case of a qualified bene-
ficiary other than a qualified beneficiary
described in section 607(3)(C) entitled to
benefits under title XVIII of the Social Se-
curity Act under section 226A of such Act
for a period of 36 months.’’.
(3) AMENDMENTS
TO
THE
PUBLIC
HEALTH
SERVICE
ACT.—Section 2202(2)(D) of the Public
Health Service Act (42 U.S.C. 300bb–2(2)(D)) is
amended—
(A) by striking ‘‘or’’ at the end of clause
(i),
(B) in clause (ii), by inserting ‘‘other than
under section 226A of such Act’’ after ‘‘Social
Security Act’’,
(C) by striking the period at the end of
clause (ii) and inserting ‘‘, or’’, and
(D) by adding at the end the following:
‘‘(iii) in the case of a qualified bene-
ficiary entitled to benefits under title
XVIII of the Social Security Act under
section 226A of such Act for a period of
36 months.’’.
(4) EFFECTIVE DATE.—The amendments made
by this subsection shall apply to individuals who be-
come eligible for benefits under title XVIII of the
Social Security Act under section 226A of such Act
on and after the date of the enactment of this Act.
(c) EXTENSION OF MEDICARE ESRD SECONDARY
PAYER PERIOD TO 36 MONTHS.—The last sentence of
section 1862(b)(1)(C) of the Social Security Act (42
U.S.C. 1395y(b)(1)(C)), as added by section 4631(b)(2)
of the Balanced Budget Act of 1997 (Public Law 105–
33), is amended by striking ‘‘30-month’’ and inserting
‘‘36-month’’.
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