[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[S. 765 Introduced in Senate (IS)]
103d CONGRESS
1st Session
S. 765
To amend title I of the Employee Retirement Income Security Act of 1974
to improve protection of benefits under group health plans, to provide
for adequate notice of adoption of material coverage restrictions under
such plans, and to provide for effective remedies for violations of
such title with respect to such plans.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
April 2 (legislative day, March 3), 1993
Mrs. Boxer (for herself, Mr. DeConcini, and Mr. Feingold) introduced
the following bill; which was read twice and referred to the Committee
on Labor and Human Resources
_______________________________________________________________________
A BILL
To amend title I of the Employee Retirement Income Security Act of 1974
to improve protection of benefits under group health plans, to provide
for adequate notice of adoption of material coverage restrictions under
such plans, and to provide for effective remedies for violations of
such title with respect to such plans.
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 ``Health Insurance Protection Act of
1993''.
SEC. 2. PROTECTION FROM INTERFERENCE WITH RIGHTS.
Section 510 of the Employee Retirement Income Security Act of 1974
(29 U.S.C. 1140) is amended--
(1) by inserting ``(a) In General.--'' after ``Sec. 510.'';
and
(2) by adding at the end the following new subsection:
``(b) Discrimination Based on Benefit Claims Under Group Health
Plans.--
``(1) In general.--It shall be unlawful discrimination for
purposes of subsection (a) to take any action to cancel or
reduce a benefit of a participant or beneficiary under a group
health plan (by plan amendment or plan termination, change in
insured status of the plan, change of insurer under the plan,
or any other means), if--
``(A) such action is specifically related to one or
more particular diseases or medical conditions,
``(B) such participant or beneficiary is
undergoing, at the time such action is taken, a course
of treatment related to any such disease or medical
condition, and
``(C) a valid claim under the plan reasonably
related to such course of treatment has been submitted
to the plan by or on behalf of such participant or
beneficiary prior to the taking of such action.
``(2) Special rule related to plan terminations.--Paragraph
(1) shall not apply to any cancellation or reduction of a
benefit by termination of a group health plan unless the
employer replaces the plan.
``(3) Definitions.--For purposes of this subsection--
``(A) Group health plan.--The term `group health
plan' has the meaning provided in section 607(1).
``(B) Change in insured status.--The term `change
in insured status' of a plan means a change to self-
insured status or a change in the extent to which
benefits provided under the plan are provided under a
contract or policy of insurance issued by an insurer
under the plan.
``(C) Insurer.--The term `insurer' under a plan
means a person licensed by a State to engage in the
business of insurance who provides benefits under the
plan under a contract or policy of insurance issued by
such person.
``(D) Valid claim.--The term `valid claim' under a
group health plan means a claim which, at the time of
its submission by or on behalf of a participant or
beneficiary, would have entitled the participant or
beneficiary to benefits under the plan.''.
SEC. 3. NONDISCRIMINATION IN LIFETIME BENEFIT COVERAGE UNDER A GROUP
HEALTH PLAN.
(a) In General.--Part 5 of title I of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1001 et seq.) is amended by
adding at the end the following new section:
``nondiscrimination in lifetime benefit coverage under a group health
plan
``Sec. 516. (a) In General.--
``(1) Unlawful discrimination.--It shall be unlawful for a
group health plan to discriminate among diseases or medical
conditions with respect to levels of lifetime benefit coverage
provided to similarly situated participants and beneficiaries
under the plan.
``(2) Definition.--For purposes of this section, the term
`lifetime benefit coverage' provided to any participant or
beneficiary under a plan means the maximum benefit available
under the plan in the aggregate to such participant or
beneficiary.
``(b) Limitation.--Subsection (a) shall not apply with respect to
participants and their beneficiaries under a group health plan if the
requirements of paragraph (1) or (2) are met as follows:
``(1) Collective bargaining.--The requirements of this
paragraph are met if--
``(A) the participants consist of employees covered
by a collective bargaining agreement between employee
representatives and one or more employers,
``(B) there is evidence that benefits provided
under the group health plan established or maintained
pursuant to such collective bargaining agreement were
the subject of good faith bargaining between such
employee representatives and such employer or
employers, and
``(C) the discrimination consists of a lack of
uniformity based solely on--
``(i) variations in the required terms of
the collective bargaining agreement as applied
to separate geographically located facilities
of the same employer, or
``(ii) different levels of contributions to
such plan negotiated between such employee
representatives and more than 1 employer, as
set forth in applicable collective bargaining
agreements.
``(2) Exemption procedure.--The requirements of this
paragraph are met if the sponsor of such group health plan
demonstrates to the Secretary by a preponderance of the
evidence that such sponsor will be unable to continue such plan
unless granted relief from the applicable requirements of
subsection (a), pursuant to an exemption procedure which--
``(A) shall be established by the Secretary by
regulation for purposes of this subsection, and
``(B) shall be subject to standards and procedures
similar to those applicable under section 408(a) with
respect to exemptions granted under such section.''.
(b) Clerical Amendment.--The table of contents in section 1 of such
Act is amended by inserting after the item relating to section 514 the
following new items:
``Sec. 515. Delinquent contributions.
``Sec. 516. Nondiscrimination in lifetime benefit coverage under a
group health plan.''.
SEC. 4. REPORTING AND DISCLOSURE REQUIREMENTS.
(a) Notice of Modifications and Changes.--Section 104(b)(1) of the
Employee Retirement Income Security Act of 1974 (29 U.S.C. 1024(b)(1))
is amended by adding at the end the following: ``In the case of a group
health plan (as defined in section 607(1)), the adoption of any
material coverage restriction which constitutes a modification
described in section 102(a)(1) or which is represented by any change in
the information required under section 102(b), may not take effect
until 60 days after such a summary description of such modification or
change is furnished to each participant and to each spouse of a
participant who is a beneficiary under the plan in language calculated
to be easily understood by the typical participant or beneficiary. For
purposes of the preceding sentence, the term `material coverage
restriction' means any change in the terms of a group health plan that
results in elimination of, or increased restrictions on, any form of
benefit coverage which was provided by the plan prior to the change,
including the establishment of, or increases in the amount of,
deductibles or coinsurance payments required of participants and
beneficiaries under the plan, except that the Secretary may by
regulation exclude from such term any such change of a type which the
Secretary finds to be de minimis.''.
(b) Special Requirements for Self-Insured Plans.--Section 102(b) of
such Act (29 U.S.C. 1022(b)) is amended--
(1) by inserting ``(1)'' after ``(b)''; and
(2) by adding at the end the following new paragraph:
``(2)(A) In the case of a self-insured group health plan, in
addition to the information required under paragraph (1), the plan
description and summary plan description shall contain a statement--
``(i) indicating that the plan is a self-insured group
health plan and is not a policy of insurance,
``(ii) identifying the person who is responsible for claim
determinations and processing, and
``(iii) indicating that the plan is not subject to State
guarantee fund protection and that, if the plan does not pay
all benefits for which participants or beneficiaries are
eligible under the plan, responsibility for payment for medical
care may to some extent remain with the participant or
beneficiary.
``(B) For purposes of this paragraph--
``(i) the term `group health plan' has the meaning provided
in section 607(1); and
``(ii) a group health plan is `self-insured' unless all
benefits provided under the plan are provided under a contract
or policy of insurance issued by a person licensed by a State
to engage in the business of insurance.''.
SEC. 5. LEGAL RELIEF FROM DAMAGES FOR INTERFERENCE WITH RIGHTS UNDER
PLAN.
(a) Damages.--Section 502(c) of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1132(c)) is amended by adding at the
end the following new paragraph:
``(4)(A) Any person who violates section 510 or 516 with respect to
any participant or beneficiary under a group health plan shall be
liable to such participant or beneficiary for actual and consequential
damages. Subject to subparagraph (B), damages for such violation shall
not include punitive damages.
``(B) In any case in which the violation constitutes willful,
fraudulent, or malicious conduct, bad faith, or gross negligence, each
person liable under subparagraph (A) may, in the court's discretion, be
liable to such participant or beneficiary for punitive damages in an
amount up to 200 percent of the amount of actual damages awarded, but
not less than $50,000. Any such punitive damages shall be in addition
to any actual damages under subparagraph (A).
``(C) For purposes of this paragraph, the term `group health plan'
has the meaning provided in section 607(1).''.
(b) Attorney's Fees.--Section 502(g) of such Act (29 U.S.C.
1132(g)) is amended by adding at the end the following new paragraph:
``(3) In any action for damages under subsection (c)(4) in which
the plaintiff prevails or substantially prevails, the court shall award
the plaintiff reasonable attorney's fees and other costs of the action,
including reasonable expert witness fees and costs, to be paid by the
defendant. Fees awarded under this paragraph shall be at generally
prevailing hourly rates.''.
SEC. 6. EFFECTIVE DATE.
The amendments made by this Act shall apply with respect to changes
in group health plan coverage adopted on or after the date of the
enactment of this Act.
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