Home > 106th Congressional Bills > H.R. 4040 (rh) To amend title 5, United States Code, to provide for the establishment of a program under which long-term care insurance is made available to Federal employees, members of the uniformed services, and civilian and military retirees, and for...H.R. 4040 (rh) To amend title 5, United States Code, to provide for the establishment of a program under which long-term care insurance is made available to Federal employees, members of the uniformed services, and civilian and military retirees, and for...
106th CONGRESS
2d Session
H. R. 4040
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
May 10, 2000
Recieved; read twice and referred to the Committee on Governmental
Affairs
_______________________________________________________________________
AN ACT
To amend title 5, United States Code, to provide for the establishment
of a program under which long-term care insurance is made available to
Federal employees, members of the uniformed services, and civilian and
military retirees, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Long-Term Care Security Act''.
SEC. 2. LONG-TERM CARE INSURANCE.
(a) In General.--Subpart G of part III of title 5, United States
Code, is amended by adding at the end the following:
``CHAPTER 90--LONG-TERM CARE INSURANCE
``Sec.
``9001. Definitions.
``9002. Availability of insurance.
``9003. Contracting authority.
``9004. Financing.
``9005. Preemption.
``9006. Studies, reports, and audits.
``9007. Jurisdiction of courts.
``9008. Administrative functions.
``9009. Cost accounting standards.
``Sec. 9001. Definitions
For purposes of this chapter:
``(1) Employee.--The term `employee' means--
``(A) an employee as defined by section 8901(1);
and
``(B) an individual described in section 2105(e),
but does not include an individual employed by the government
of the District of Columbia.
``(2) Annuitant.--The term `annuitant' has the meaning such
term would have under paragraph (3) of section 8901 if, for
purposes of such paragraph, the term `employee' were considered
to have the meaning given to it under paragraph (1) of this
subsection.
``(3) Member of the uniformed services.--The term `member
of the uniformed services' means a member of the uniformed
services, other than a retired member of the uniformed
services, who is--
``(A) on active duty or full-time National Guard
duty for a period of more than 30 days; and
``(B) a member of the Selected Reserve.
``(4) Retired member of the uniformed services.--The term
`retired member of the uniformed services' means a member or
former member of the uniformed services entitled to retired or
retainer pay, including a member or former member retired under
chapter 1223 of title 10 who has attained the age of 60 and who
satisfies such eligibility requirements as the Office of
Personnel Management prescribes under section 9008.
``(5) Qualified relative.--The term `qualified relative'
means each of the following:
``(A) The spouse of an individual described in
paragraph (1), (2), (3), or (4).
``(B) A parent, stepparent, or parent-in-law of an
individual described in paragraph (1) or (3).
``(C) A child (including an adopted child, a
stepchild, or, to the extent the Office of Personnel
Management by regulation provides, a foster child) of
an individual described in paragraph (1), (2), (3), or
(4), if such child is at least 18 years of age.
``(D) An individual having such other relationship
to an individual described in paragraph (1), (2), (3),
or (4) as the Office may by regulation prescribe.
``(6) Eligible individual.--The term `eligible individual'
refers to an individual described in paragraph (1), (2), (3),
(4), or (5).
``(7) Qualified carrier.--The term `qualified carrier'
means an insurance company (or consortium of insurance
companies) that is licensed to issue long-term care insurance
in all States, taking any subsidiaries of such a company into
account (and, in the case of a consortium, considering the
member companies and any subsidiaries thereof, collectively).
``(8) State.--The term `State' includes the District of
Columbia.
``(9) Qualified long-term care insurance contract.--The
term `qualified long-term care insurance contract' has the
meaning given such term by section 7702B of the Internal
Revenue Code of 1986.
``(10) Appropriate secretary.--The term `appropriate
Secretary' means--
``(A) except as otherwise provided in this
paragraph, the Secretary of Defense;
``(B) with respect to the Coast Guard when it is
not operating as a service of the Navy, the Secretary
of Transportation;
``(C) with respect to the commissioned corps of the
National Oceanic and Atmospheric Administration, the
Secretary of Commerce; and
``(D) with respect to the commissioned corps of the
Public Health Service, the Secretary of Health and
Human Services.
``Sec. 9002. Availability of insurance
``(a) In General.--The Office of Personnel Management shall
establish and, in consultation with the appropriate Secretaries,
administer a program through which an individual described in paragraph
(1), (2), (3), (4), or (5) of section 9001 may obtain long-term care
insurance coverage under this chapter for such individual.
``(b) General Requirements.--Long-term care insurance may not be
offered under this chapter unless--
``(1) the only coverage provided is under qualified long-
term care insurance contracts; and
``(2) each insurance contract under which any such coverage
is provided is issued by a qualified carrier.
``(c) Documentation Requirement.--As a condition for obtaining
long-term care insurance coverage under this chapter based on one's
status as a qualified relative, an applicant shall provide
documentation to demonstrate the relationship, as prescribed by the
Office.
``(d) Underwriting Standards.--
``(1) Disqualifying condition.--Nothing in this chapter
shall be considered to require that long-term care insurance
coverage be made available in the case of any individual who
would be eligible for benefits immediately.
``(2) Spousal parity.--For the purpose of underwriting
standards, a spouse of an individual described in paragraph
(1), (2), (3), or (4) of section 9001 shall, as nearly as
practicable, be treated like that individual.
``(3) Guaranteed issue.--Nothing in this chapter shall be
considered to require that long-term care insurance coverage be
guaranteed to an eligible individual.
``(4) Requirement that contract be fully insured.--In
addition to the requirements otherwise applicable under section
9001(9), in order to be considered a qualified long-term care
insurance contract for purposes of this chapter, a contract
must be fully insured, whether through reinsurance with other
companies or otherwise.
``(5) Higher standards allowable.--Nothing in this chapter
shall, in the case of an individual applying for long-term care
insurance coverage under this chapter after the expiration of
such individual's first opportunity to enroll, preclude the
application of underwriting standards more stringent than those
that would have applied if that opportunity had not yet
expired.
``(e) Guaranteed Renewability.--The benefits and coverage made
available to eligible individuals under any insurance contract under
this chapter shall be guaranteed renewable (as defined by section 7A(2)
of the model regulations described in section 7702B(g)(2) of the
Internal Revenue Code of 1986), including the right to have insurance
remain in effect so long as premiums continue to be timely made.
However, the authority to revise premiums under this chapter shall be
available only on a class basis and only to the extent otherwise
allowable under section 9003(b).
``Sec. 9003. Contracting authority
``(a) In General.--The Office of Personnel Management shall,
without regard to section 5 of title 41 or any other statute requiring
competitive bidding, contract with one or more qualified carriers for a
policy or policies of long-term care insurance. The Office shall ensure
that each resulting contract (hereafter in this chapter referred to as
a `master contract') is awarded on the basis of contractor
qualifications, price, and reasonable competition.
``(b) Terms and Conditions.--
``(1) In general.--Each master contract under this chapter
shall contain--
``(A) a detailed statement of the benefits offered
(including any maximums, limitations, exclusions, and
other definitions of benefits);
``(B) the premiums charged (including any
limitations or other conditions on their subsequent
adjustment);
``(C) the terms of the enrollment period; and
``(D) such other terms and conditions as may be
mutually agreed to by the Office and the carrier
involved, consistent with the requirements of this
chapter.
``(2) Premiums.--Premiums charged under each master
contract entered into under this section shall reasonably and
equitably reflect the cost of the benefits provided, as
determined by the Office. The premiums shall not be adjusted
during the term of the contract unless mutually agreed to by
the Office and the carrier.
``(3) Nonrenewability.--Master contracts under this chapter
may not be made automatically renewable.
``(c) Payment of Required Benefits; Dispute Resolution.--
``(1) In general.--Each master contract under this chapter
shall require the carrier to agree--
``(A) to provide payments or benefits to an
eligible individual if such individual is entitled
thereto under the terms of the contract; and
``(B) with respect to disputes regarding claims for
payments or benefits under the terms of the contract--
``(i) to establish internal procedures
designed to expeditiously resolve such
disputes; and
``(ii) to establish, for disputes not
resolved through procedures under clause (i),
procedures for one or more alternative means of
dispute resolution involving independent third-
party review under appropriate circumstances by
entities mutually acceptable to the Office and
the carrier.
``(2) Eligibility.--A carrier's determination as to whether
or not a particular individual is eligible to obtain long-term
care insurance coverage under this chapter shall be subject to
review only to the extent and in the manner provided in the
applicable master contract.
``(3) Other claims.--For purposes of applying the Contract
Disputes Act of 1978 to disputes arising under this chapter
between a carrier and the Office--
``(A) the agency board having jurisdiction to
decide an appeal relative to such a dispute shall be
such board of contract appeals as the Director of the
Office of Personnel Management shall specify in writing
(after appropriate arrangements, as described in
section 8(c) of such Act); and
``(B) the district courts of the United States
shall have original jurisdiction, concurrent with the
United States Court of Federal Claims, of any action
described in section 10(a)(1) of such Act relative to
such a dispute.
``(4) Rule of construction.--Nothing in this chapter shall
be considered to grant authority for the Office or a third-
party reviewer to change the terms of any contract under this
chapter.
``(d) Duration.--
``(1) In general.--Each master contract under this chapter
shall be for a term of 7 years, unless terminated earlier by
the Office in accordance with the terms of such contract.
However, the rights and responsibilities of the enrolled
individual, the insurer, and the Office (or duly designated
third-party administrator) under such contract shall continue
with respect to such individual until the termination of
coverage of the enrolled individual or the effective date of a
successor contract thereto.
``(2) Exception.--
``(A) Shorter duration.--In the case of a master
contract entered into before the end of the period
described in subparagraph (B), paragraph (1) shall be
applied by substituting `ending on the last day of the
7-year period described in paragraph (2)(B)' for `of 7
years'.
``(B) Definition.--The period described in this
subparagraph is the 7-year period beginning on the
earliest date as of which any long-term care insurance
coverage under this chapter becomes effective.
``(3) Congressional notification.--No later than 180 days
after receiving the second report required under section
9006(c), the President (or his designee) shall submit to the
Committees on Government Reform and on Armed Services of the
House of Representatives and the Committees on Governmental
Affairs and on Armed Services of the Senate, a written
recommendation as to whether the program under this chapter
should be continued without modification, terminated, or
restructured. During the 180-day period following the date on
which the President (or his designee) submits the
recommendation required under the preceding sentence, the
Office of Personnel Management may not take any steps to rebid
or otherwise contract for any coverage to be available at any
time following the expiration of the 7-year period described in
paragraph (2)(B).
``(4) Full portability.--Each master contract under this
chapter shall include such provisions as may be necessary to
ensure that, once an individual becomes duly enrolled, long-
term care insurance coverage obtained by such individual
pursuant to that enrollment shall not be terminated due to any
change in status (such as separation from Government service or
the uniformed services) or ceasing to meet the requirements for
being considered a qualified relative (whether as a result of
dissolution of marriage or otherwise).
``Sec. 9004. Financing
``(a) In General.--Each eligible individual obtaining long-term
care insurance coverage under this chapter shall be responsible for 100
percent of the premiums for such coverage.
``(b) Withholdings.--
``(1) In general.--The amount necessary to pay the premiums
for enrollment may--
``(A) in the case of an employee, be withheld from
the pay of such employee;
``(B) in the case of an annuitant, be withheld from
the annuity of such annuitant;
``(C) in the case of a member of the uniformed
services described in section 9001(3), be withheld from
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