Health Security Act

Health Security Act - Title I: Health Security Benefits - Provides that every resident of the U.S. (and every non-resident citizen when in the U.S.) will be eligible for covered services. Permits reciprocal and "buy-in" agreements for groups or non-resident aliens, and in some cases benefits to U.S. residents when visiting in other countries.

Entitles every eligible person to have payments made by the Board for covered services provided within the United States by a participating provider.

Provides that all necessary professional services of physicians, whenever furnished are covered, including preventive care, with two important restrictions: (1) specialist services are covered only when performed by a qualified specialist - except in emergency situations - and generally only on referral from a primary physician and (2) psychiatric services to an ambulatory patient are covered only for active preventive, diagnostic, therapeutic or rehabilitative service with respect to mental illness.

Provides that comprehensive dental services (exclusive of most orthodontia) are covered for children under age 15, with the covered age group increasing by two years each year until all those under age 25 are covered.

Provides that: (1) inpatient and outpatient hospital services, and services of a home health agency are covered without arbitrary limitation; (2) pathology and radiology services are specifically included as parts of institutional services, thus reversing the practice of Medicare; and (3) custodial care is specifically excluded in any institution, thus necessitating the two important restrictions on payments for institutional care.

Limits payment for skilled nursing home care to 120 days per spell of illness, except that this limit may be increases when the nursing home is owned or managed by a hospital and payment forr care is made through the hospital benefit to 45 consecutive days of active treatment during a spell of illness.

Provides coverage for two categories of drug use: prescribed medicines administered to inpatients or outpatients within participating hospitals; or to enrollees of comprehensive health service organizations, and drugs necessary for the treatment of specified chronic illnesses or conditions requiring long or expensive therapy.

Requires the Board and the Secretary of HEW to establish two lists of approved drugs, taking into account the safety, efficacy and cost of each drug.

Provides a broad list of approved medicines available for use in institutions and by comprehensive health service organizations and a more restricted list which is available for use outside such organized settings.

Provides the appliances benefit is similar in concept and operation to the drug benefit, subject to a limitation on aggregate cost. Asserts that the professional services of optometrists and podiatrists are covered, subject to regulations, as are diagnostic or therapeutic services furnished by independent pathology laboratories and radiology services.

States that health services furnished or paid for under a workmen's compensation law are not covered. Provides that the services of a professional practitioner are not covered if they are not covered if they are furnished in a hospital which is not a participating provider.

Requires that participating providers meet standards established in this title or by the Board. Requires, also, that they must agree to provide services without discrimination, to make no charge to the patient for any covered services, and to furnish data necessary for utilization review by professional peers, statistical studies by the Board, and verification of information for payments.

Makes professional practitioners licensed when the program begins, are eligible to practice in the State where they are licensed and requires that all newly, licensed applicants for participation meet national standards established by the Board in addition to those required by his state.

Requires that participating professional providers meet continuing education requirements established by the Board (in consultation with appropriate professional organizations).

Provides that major surgery and certain other specialty services shall be covered only when provided by a board certified or board eligible physician (except in emergency circumstances). Establishes conditions of participation for general hospitals similar to those required by Medicare. States that the two requirements not found in the Medicare program are: (1) that the hospital must not discriminate in granting staff privileges on any grounds unrelated to professional qualifications and (2) that it establish a pharmacy and drug therapeutics committee for supervision of hospital drug therapy.

Provides that psychiatric hospitals will be eligible to participate only if the Board finds that the hospital (or a distinct part of the hospital) is engaged in furnishing active diagnostic, therapeutic and rehabilitative services to mentally ill patients.

Establishes conditions of participation for skilled nursing homes similar to those established for extended care facilities under Medicare.

Describes a comprehensive health service organization which undertakes to provide an enrolled population either with complete health Security services (other than institutional services, mental health or dental services) for the maintenance of health and the care of ambulatory patients.

Provides that the organization, or professionals furnishing services may also serve non-enrollees, with payment to be made to the organization, or, at its request, to such professionals.

Permits a foundation sponsored by a city, county, or State medical or dental society, by agreement with the Board, to participate as a provider of services.

Permits the participation or community health centers or the like which, through furnishing services as comprehensive as are required by this predetermined population and may not meet some other requirements of this Act.

Authorizes the Board to deal separately with the primary care portion of a system of comprehensive care where it is necessary to rely on arrangements with other providers, rather than on a unified structure, to round out the other elements of the system.

Permits the Board to contract directly with public or other nonprofit mental health centers and mental health day care services. Permits the Board to contract with nonprofit health prepayment or insurance organizations which provide substantially comprehensive services to ambulatory patients, on terms similar to those specified for professional foundations.

Specifies the broad and general conditions under which independent pathology laboratories, independent radiological services, providers of drugs, devices, appliances, equipment, or ambulance services may qualify as providers under Health Security.

Requires that a participating skilled nursing home to have in effect an agreement with at least one participating hospital for the transfer of patients and medical and other information as medically appropriate.

Requires the Board in fixing, for institutional and other providers, standards beyond those specified in the statute, to take into consideration criteria established or recommended by appropriate professional organizations.

Excludes the institutions of the Department of Defense and the Veterans Administration, and institutions of the Department of Health, Education, and Welfare serving merchant seamen or Indians or Alaskan natives, from serving as participating providers, as is also any employee of these institutions when he is acting as an employee.

Provides reimbursement for any services furnished (in emergencies, for example) by these institutions or agencies to eligible persons who are not a part of their normal clientele.

Overrides, for purposes of the Health Security program, State laws of several kinds which inhibit the utilization or the mobility of health personnel, cloud the legality of so-called "corporate practice" of health professions, or restrict the creation of group practice organizations.

Permits a physician, dentist, optometrist, or podiatrist, licensed in one State and meeting the national standards, to furnish Health Security benefits in any other state, the scope of his permissible practice being goverened by the law of the State in which he is practicing.

Grants a similar authority to other health professional and nonprofessional personnel.

Establishes the Health Security Trust Fund, to receive the net assets of existing (Medicare) funds taken over by the Health Security program, the yield of the Health Security taxes, and the Government's contribution from general revenues amounting to 100 percent of the yield form these taxes.

Provides that three separate accounts shall be established in the Health Security Trust Fund: a Health Service Account, a Health Resources Development Account, and an Administration Account.

Provides that in each of the first two years of program operation, 2 percent of the Trust Fund shall be set aside for the Health Resources Development Fund; and the allocation shall increase by 1 percent at two-year intervals to 5 percent within the next 6 years.

Provides for allocation of the Health Services account among the regions of the country.

Provides that the allocation to each region shall be based on the aggregate sum expended during the most recent 12-month period for covered services (with appropriate modification for estimated changes in the consumer price index, the expected number of eligible beneficiaries, estimated change in the number of participating providers).

Provides that the Board will divide the allocation to each region into funds available to pay; institutional services; physician services; dental services; furnishing of drugs; furnishing of devices, appliances, equipment; and miscellaneous services.

Provides that payments for covered services provided to eligible persons by participating providers will be made from the Health Service Account in the Trust Fund.

Describes the method to be used in applying, as between practitioners electing the various methods of payment, the monies available in each health service area for payment to each category or professional providers.

Authorizes the Board to experiment with other methods of reimbursement so long as the experimental method does not increase the cost of service or lead to overutilization or underutilization of services.

Provides that skilled nursing homes and home health agencies will be paid in the same manner as a general hospital (on an approved annual budget basis).

Provides that a comprehensive health service organization will be paid for other than hospital or skilled nursing home services, on the basis of a fixed capitation rate multiplied by the number of eligible enrollees.

Contains a series of provisions to assist in the recruitment, education, and training of health personnel.

Authorizes special improvement grants: (1) to any public or other nonprofit health agency or institution to establish improved coordination and linkages with other providers of services and (2) to organizations providing comprehensive ambulatory care, ot improve their utilization review, budget, statistical, or records and information retrieval systems, to acquire equipment needed for those purposes, or to acquire equipment useful for mass screening or for other diagnostic or therapeutic purposes.

Sets forth the responsibilities and duties of the Secretary of HEW and the Board with regard to this title.

Creates an administrative structure within the Department of Health, Education, and Welfare with exclusive responsibility for administration of the Health Security program.

Establishes a five-member full-time Health Security Board serving under the Secretary of Health, Education, and Welfare.

Provides that the members shall be appointed by the President with advice and consent of the Senate, for five-year overlapping terms.

Creates the position of an Executive Director, appointed by the Board with the approval of the Secretary. Provides that the Executive Director will serve as secretary to the Board and shall perform such duties in administration of the program as the Board assigns to him.

Provides that the program will be administered through the regional offices of the Department of Health, Education, and Welfare. Requires the establishment of sub-regional (service area) offices.

Establishes a National Health Security Advisory Council, with the Chairman of the Board serving as the Council's Chairman and 20 additional members not in the employ of the Federal Government.

Authorizes the Advisory Council to appoint professional or technical committees to assist in the Board on matters of general policy in the administration of the program, the formulation of regulations and the allocation of funds for services.

Charges the Board with responsibility for informing the public and providers about the administration and operation of the Health Security program.

Requires the Board to make a continuing study and evaluation of the program, including adequacy, quality and costs of services. Authorizes the Board directly or by contract to make detailed statistical and other studies on a national, regional, or local basis of any aspect of the title, to develop and test incentive systems for improving quality of care, methods of peer review of drug utilization and of other service performances, systems of information retrieval, budget programs, instrumentation for multiphasic screening or patient services, reimbursement systems for drugs, and other studies which it considers would improve the quality of services of administration of the program.

Grants authority ot the Board, in accordance with regulations, to make determinations of who are participating providers of service, determinations of eligibility, of whether services are covered, and the amount to be paid to providers.

Title II: Health Security Taxes - Converts the existing Medicare hospital insurance payroll taxes into Health Security taxes, and raises the rates to 1 percent on employees and 3.5 percent on employers. Raises the wage base for the employee tax from the present $7,800 to $15,000 with subsequent further increase if wage levels rise. Eliminates the wage ceiling from the employer tax, and broadens the definitions of covered employment to include foreign agricultural workers, employees of the U.S. and its instrumentalities (other than members of the armed forces and the President, Vice-President, and Members of Congress), employees of charitable ans similar organizations, railroad employees, and (for the employee tax only) employees of States and their political subdivisions and instrumentalities. Provides the mechanism for increasing the wage base, by $600 intervals, in proportion to future increases in average wage levels.

Excludes from the gross income of employees, for income tax purposes, payment by their employers of part or all of the Health Security taxes on the employees. Spells out the precise effective dates of the new payroll tax provisions. Converts the existing Medicare self-employment tax, and raises the rate to 2.5 percent, and raises the maximum taxable self-employment income from $7,800 to $15,000 (with the same upward adjustment as in the employee tax for subsequent rises in average wage levels). Adds a new 1 percent Health Security tax on unearned income (unless such income is less than $400 a year), subject to the same maximum on taxable income as is applicable to the employee and self-employment taxes. Requires that after the effective date of benefits, no State shall be required to furnish any service covered under Health Security as a part of its State plan for participation under Medicaid, and that the Federal government will have no responsibility to reimburse any State for the cost of providing a service which is covered under Health Security.

Provides that funds available under the Vocational Rehabilitation Act or the Maternal and Child Health title of the Social Security Act shall not be used to pay for personal health services after the effective date of benefits, except (to the extent prescribed in regulations by the Secretary of HEW) to pay for service which are more extensive than those covered under Health Security.

Title III: Repeal or Amendments of Other Act - Makes various conforming amendments to the medicare, medicaid, vocational rehabilitation, and Federal employees health benefits statutes to bring it into conformity with this Act.

Title IV: Studies Related to Health Security - Authorizes the Secretary of Health, Education, and Welfare in consultation with the Secretary of the State and the Secretary of the Treasury ot study the coverage of health services for U.S. residents in other countries. Sets forth Congressional findings concerning the shortage of appropriate services and facilities for the long-term care of the aged or chronically sick. Directs the Secretary to make a comprehensive study of the need for additional social, homemaker and other services for the most equitable and appropriate means of financing such services. Directs the Secretary of HEW to study the feasibility and desirability of coordinating the federal health benefit programs for merchant seamen, and Indians and Alaskan natives with the health security benefit program.

Requires the Secretary and Administrator to consult with representatives of the affected beneficiary groups and include a summary of their views in the reports to Congress. Sets forth Congressional findings concerning medical malpractice, and the methods of determining liability and assessing damages, are unsatisfactory. Directs the Secretary to make a comprehensive study of the problem, including the most appropriate criterion of compensable injury, means of adjudication, and means of financing the payment of compensation.