article: SECTION 1. SHORT TITLE. This Act may be cited as the ``Health Care Continuation Coverage Act of 2002''. SEC. 2. PREMIUM ASSISTANCE FOR COBRA CONTINUATION COVERAGE. (a) Establishment.-- (1) In general.--Not later than 60 days after the date of enactment of this Act, the Secretary of the Treasury, in consultation with the Secretary of Labor, shall establish a program under which premium assistance for COBRA continuation coverage shall be provided for qualified individuals under this section. (2) Qualified individuals.--For purposes of this section, a qualified individual is an individual who-- (A) establishes that the individual-- (i) on or after July 1, 2001, became entitled to elect COBRA continuation coverage; and (ii) has elected such coverage; and (B) enrolls in the premium assistance program under this section by not later than the end of such 1-year period. (b) Limitation of Period of Premium Assistance.--Premium assistance provided under this subsection shall end with respect to an individual on the earlier of-- (1) the date the individual is no longer covered under COBRA continuation coverage; or (2) 12 months after the date the individual is first enrolled in the premium assistance program established under this section. (c) Payment, and Crediting of Assistance.-- (1) Amount of assistance.--Premium assistance provided under this section shall be equal to 100 percent of the amount of the premium required for the COBRA continuation coverage. (2) Provision of assistance.--Premium assistance provided under this section shall be provided through the establishment of direct payment arrangements with the administrator of the group health plan (or other entity) that provides or administers the COBRA continuation coverage. It shall be a fiduciary duty of such administrator (or other entity) to enter into such arrangements under this section. (3) Premiums payable by qualified individual reduced by amount of assistance.--Premium assistance provided under this section shall be credited by such administrator (or other entity) against the premium otherwise owed by the individual involved for such coverage. (d) Change in COBRA Notice.-- (1) General notice.-- (A) In general.--In the case of notices provided under section 4980B(f)(6) of the Internal Revenue Code of 1986 with respect to individuals who, on or after July 1, 2001, become entitled to elect COBRA continuation coverage, such notices shall include an additional notification to the recipient of the availability of premium assistance for such coverage under this section. (B) Alternative notice.--In the case of COBRA continuation coverage to which the notice provision under section 4980B(f)(6) of the Internal Revenue Code of 1986 does not apply, the Secretary of the Treasury shall, in coordination with administrators of the group health plans (or other entities) that provide or administer the COBRA continuation coverage involved, assure provision of such notice. (C) Form.--The requirement of the additional notification under this paragraph may be met by amendment of existing notice forms or by inclusion of a separate document with the notice otherwise required. (2) Specific requirements.--Each additional notification under paragraph (1) shall include-- (A) the forms necessary for establishing eligibility under subsection (a)(2)(A) and enrollment under subsection (a)(2)(B) in connection with the coverage with respect to each covered employee or other qualified beneficiary; (B) the name, address, and telephone number necessary to contact the plan administrator and any other person maintaining relevant information in connection with the premium assistance; and (C) the following statement displayed in a prominent manner: ``You may be eligible to receive assistance with payment of 100 percent of your COBRA continuation coverage premiums for a duration of not to exceed 12 months.''. (3) Notice relating to retroactive coverage.--In the case of such notices previously transmitted before the date of the enactment of this Act in the case of an individual described in paragraph (1) who has elected (or is still eligible to elect) COBRA continuation coverage as of the date of the enactment of this Act, the administrator of the group health plan (or other entity) involved or the Secretary of the Treasury (in the case described in the paragraph (1)(B)) shall provide (within 60 days after the date of the enactment of this Act) for the additional notification required to be provided under paragraph (1). (4) Model notices.--The Secretary shall prescribe models for the additional notification required under this subsection. (f) Obligation of Funds.--This section constitutes budget authority in advance of appropriations Acts and represents the obligation of the Federal Government to provide for the payment of premium assistance under this section. (g) Prompt Issuance of Guidance.--The Secretary of the Treasury, in consultation with the Secretary of Labor, shall issue guidance under this section not later than 30 days after the date of the enactment of this Act. (h) Definitions.--In this section: (1) Administrator.--The term ``administrator'' has the meaning given such term in section 3(16) of the Employee Retirement Income Security Act of 1974. (2) COBRA continuation coverage.--The term ``COBRA continuation coverage'' means continuation coverage provided pursuant to title XXII of the Public Health Service Act, section 4980B of the Internal Revenue Code of 1986 (other than subsection (f)(1) of such section insofar as it relates to pediatric vaccines), part 6 of subtitle B of title I of the Employee Retirement Income Security Act of 1974 (other than under section 609), section 8905a of title 5, United States Code, or under a State program that provides continuation coverage comparable to such continuation coverage. (3) Group health plan.--The term ``group health plan'' has the meaning given such term in section 9832(a) of the Internal Revenue Code of 1986. (4) State.--The term ``State'' includes the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, Guam, American Samoa, and the Commonwealth of the Northern Mariana Islands. SEC. 3. TEMPORARY MEDICAID COVERAGE FOR CERTAIN UNINSURED EMPLOYEES. (a) In General.--Notwithstanding any other provision of law, with respect to any month, as a condition for the receipt of Federal financial participation under title XIX of the Social Security Act, a State shall provide, under its medicaid program under such title, medical assistance in the case of an individual-- (1) who has become totally or partially separated from employment on or after July 1, 2001; (2) who is not eligible for COBRA continuation coverage; and (3) who is uninsured; and to the individual's spouse and dependents (as defined for purposes of the Internal Revenue Code of 1986) if they also are uninsured. (b) Limitation of Period of Coverage.--Assistance under this section shall end with respect to an individual on the earlier of-- (1) the date the individual is no longer uninsured; or (2) 12 months after the date the individual is first determined to be eligible for medical assistance under this section. (c) Special Rules.--In the case of medical assistance provided under this section-- (1) the Federal medical assistance percentage under section 1905(b) of the Social Security Act shall be the enhanced FMAP (as defined in section 2105(b) of such Act); (2) a State may elect to apply alternative income, asset, and resource limitations and the provisions of section 1916(g) of such Act, except that in no case shall a State cover individuals with higher family income without covering individuals with a lower family income; (3) such medical assistance shall not be provided for periods before the date the individual becomes uninsured; (4) individuals eligible for medical assistance under this section shall be deemed to be described in the list of individuals described in the matter preceding paragraph (1) of section 1905(a) of such Act; (5) a State may elect to provide such medical assistance without regard to any limitation under sections 401(a), 402(b), 403, and 421 of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (8 U.S.C. 1611(a), 1612(b), 1613, and 1631) and no debt shall accrue under an affidavit of support against any sponsor of an individual who is an alien who is provided such assistance, and the cost of such assistance shall not be considered as an unreimbursed cost; and (6) the Secretary of Health and Human Services shall not count, for purposes of section 1108(f) of the Social Security Act, such amount of payments under this section as bears a reasonable relationship to the average national proportion of payments made under this section for the 50 States and the District of Columbia to the payments otherwise made under title XIX for such States and District. (d) Definitions.--For purposes of this subtitle: (1) Uninsured.--The term ``uninsured'' means, with respect to an individual, that the individual is not covered under-- (A) a group health plan (as defined in section 2791(a) of the Public Health Service Act), (B) health insurance coverage (as defined in section 2791(b)(1) of the Public Health Service Act), or (C) a program under title XVIII, XIX, or XXI of the Social Security Act, other than under such title XIX pursuant to this section. For purposes of this paragraph, such coverage under subparagraph (A) or (B) shall not include coverage consisting solely of coverage of excepted benefits (as defined in section 2791(c) of the Public Health Service Act). (2) COBRA continuation coverage.--The term ``COBRA continuation coverage'' means coverage under a group health plan provided by an employer pursuant to title XXII of the Public Health Service Act, section 4980B of the Internal Revenue Code of 1986, part 6 of subtitle B of title I of the Employee Retirement Income Security Act of 1974, or section 8905a of title 5, United States Code. (3) State.--The term ``State'' has the meaning given such term for purposes of title XIX of the Social Security Act. (e) Effective Date.--This section shall take effect upon its enactment, whether or not regulations implementing this section are issued. SEC. 4. TEMPORARY COVERAGE FOR UNSUBSIDIZED PORTION OF COBRA CONTINUATION PREMIUMS. (a) In General.--Notwithstanding any other provision of law, with respect to COBRA continuation coverage provided for any month, as a condition of receipt of Federal financial participation under title XIX of the Social Security Act, a State shall provide payment of the unsubsidized portion of the premium for COBRA continuation coverage in the case of any individual-- (1) who has become totally or partially separated from employment on or after July 1, 2001; and (2) who is eligible for, and has elected coverage under, COBRA continuation coverage; and to the individual's spouse and dependents (as defined for purposes of the Internal Revenue Code of 1986) if they also are eligible for such coverage and are otherwise uninsured. (b) Limitation of Period of Coverage.--Premium assistance under this section shall end with respect to an individual on the earlier of-- (1) the date the individual is no longer covered under COBRA continuation coverage; or (2) 12 months after the date the individual is first determined to be eligible for premium assistance under this section. (c) Financial Payment to States.--A State providing premium assistance under this section shall be entitled to payment under section 1903(a) of the Social Security Act with respect to such assistance (and administrative expenses relating to such assistance) in the same manner as such State is entitled to payment with respect to medical assistance (and such administrative expenses) under such section, except that, for purposes of this subsection, any reference to the Federal medical assistance percentage shall be deemed a reference to the enhanced FMAP (as defined in section 2105(b) of such Act). The provisions of subsections (c)(5) and (c)(6) of section 3 shall apply with respect to this section in the same manner as it applies under such section. (d) Unsubsidized Portion of Premium for COBRA Continuation Coverage.--For purposes of this section, the term `unsubsidized portion of premium for COBRA continuation coverage' means that portion of the premium for COBRA continuation coverage for which there is no financial assistance available under section 2. (e) Effective Date.--This section shall take effect upon its enactment, whether or not regulations implementing this section are issued. SEC. 5. AMENDMENT TO THE FOOD STAMP ACT OF 1977. (a) Amendment.--Section 5(d) of the Food Stamp Act of 1977 (7 U.S.C. 2014(d)) is amended-- (1) by striking ``and (15)'' and inserting ``(15)'', and (2) by inserting before the period at the end the following: ``, and (16) compensation under the State's unemployment compensation law (including amounts payable pursuant to an agreement under a Federal unemployment compensation law)''. (b) Application of Amendment.--The amendment made by subsection (a) shall not apply with respect to certification periods that begin before the date of the enactment of this Act.
summary: Health Care Continuation Coverage Act of 2002 - Directs the Secretary of the Treasury to establish a program to provide premium assistance for qualified individuals for Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) continuation coverage under the Public Health Service Act, the Internal Revenue Code, and the Employee Retirement Income Security Act of 1974 (ERISA).Requires States to provide temporary Medicaid coverage, under title XIX (Medicaid) of the Social Security Act, for individuals who: (1) have become totally or partially separated from employment on or after July 1, 2001; (2) are not eligible for COBRA continuation coverage; and (3) are not covered under a group health plan, health insurance, Medicare, or Medicaid. Includes coverage of such individuals' spouses and dependents who are also uninsured.Requires States, under Medicaid, to pay the unsubsidized portion of COBRA continuation benefits for individuals who: (1) have become totally or partially separated from employment on or after July 1, 2001; and (2) are eligible for COBRA continuation coverage. Includes coverage of such individuals' spouses and dependents who are also eligible and otherwise uninsured.Amends the Food Stamp Act of 1977 to exclude unemployment compensation in determining eligibility and benefits under such Act.