Health Benefits in Federal Contracting Act of 1998

Health Benefits in Federal Contracting Act of 1998 - Requires any employer under a Federal contract or subcontract for an amount exceeding $10,000, to provide to each of his or her employees under such contract or subcontract health benefits similar (as specified) to those provided to Federal employees. Provides exemptions with respect to: (1) employers that are small business concerns or nonprofit, tax-exempt organizations; and (2) employees who are employed for less than 17.5 hours per week, who otherwise have health benefits coverage, or who are participating in a training program of not to exceed 6 months. Requires the contract or subcontract to specify such requirement.

Prohibits an employer from avoiding the requirement by: (1) replacing an employee with one who is not eligible for health care benefits; or (2) reducing an employee's hours.

Terminates the Federal contract or subcontract of an employer who does not provide the health benefits required. Makes such employer: (1) ineligible for any Federal contract or subcontract for five years; and (2) liable to the United States in an amount equal to the unpaid benefits and an equal amount as liquidated damages. Requires the Secretary of Labor to pay to employees who were not provided such benefits the amount recovered by the United States.