To amend title XXVII of the Public Health Service Act to permit the exception from the guaranteed issue requirement for coverage offered only through associations to be applied separately to parts of the small group market based upon size of employers.

Amends the Public Health Service Act to permit a health insurance issuer to elect to apply the bona fide association exception to the guaranteed issue requirement separately for different groups of employers within the small group market for programs in existence before June 30, 1997, if such programs are based upon an employer's number of employees.