
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 26USC9712]

 
                     TITLE 26--INTERNAL REVENUE CODE
 
                Subtitle J--Coal Industry Health Benefits
 
                CHAPTER 99--COAL INDUSTRY HEALTH BENEFITS
 
             Subchapter C--Health Benefits of Certain Miners
 
                     PART II--1992 UMWA BENEFIT PLAN
 
Sec. 9712. Establishment and coverage of 1992 UMWA Benefit Plan


(a) Creation of plan

                           (1) In general

        As soon as practicable after the enactment date, the settlors 
    shall create a separate private plan which shall be known as the 
    United Mine Workers of America 1992 Benefit Plan. For purposes of 
    this title, the 1992 UMWA Benefit Plan shall be treated as an 
    organization exempt from taxation under section 501(a). The settlors 
    shall be responsible for designing the structure, administration and 
    terms of the 1992 UMWA Benefit Plan, and for appointment and removal 
    of the members of the board of trustees. The board of trustees shall 
    initially consist of five members and shall thereafter be the number 
    set by the settlors.

                        (2) Treatment of plan

        The 1992 UMWA Benefit Plan shall be--
            (A) a plan described in section 302(c)(5) of the Labor 
        Management Relations Act, 1947 (29 U.S.C. 186(c)(5)),
            (B) an employee welfare benefit plan within the meaning of 
        section 3(1) of the Employee Retirement Income Security Act of 
        1974 (29 U.S.C. 1002(1)), and
            (C) a multiemployer plan within the meaning of section 3(37) 
        of such Act (29 U.S.C. 1002(37)).

(b) Coverage requirement

                           (1) In general

        The 1992 UMWA Benefit Plan shall only provide health benefits 
    coverage to any eligible beneficiary who is not eligible for 
    benefits under the Combined Fund and shall not provide such coverage 
    to any other individual.

                      (2) Eligible beneficiary

        For purposes of this section, the term ``eligible beneficiary'' 
    means an individual who--
            (A) but for the enactment of this chapter, would be eligible 
        to receive benefits from the 1950 UMWA Benefit Plan or the 1974 
        UMWA Benefit Plan, based upon age and service earned as of 
        February 1, 1993; or
            (B) with respect to whom coverage is required to be provided 
        under section 9711, but who does not receive such coverage from 
        the applicable last signatory operator or any related person,

    and any individual who is eligible for benefits by reason of a 
    relationship to an individual described in subparagraph (A) or (B). 
    In no event shall the 1992 UMWA Benefit Plan provide health benefits 
    coverage to any eligible beneficiary who is a coal industry retiree 
    who retired from the coal industry after September 30, 1994, or any 
    beneficiary of such individual.

(c) Health benefits

                           (1) In general

        The 1992 UMWA Benefit Plan shall provide health care benefits 
    coverage to each eligible beneficiary which is substantially the 
    same as (and subject to all the limitations of) coverage provided 
    under the 1950 UMWA Benefit Plan and the 1974 UMWA Benefit Plan as 
    of January 1, 1992.

                          (2) Managed care

        The 1992 UMWA Benefit Plan shall develop managed care and cost 
    containment rules which shall be applicable to the payment of 
    benefits under this subsection. Application of such rules shall not 
    cause the plan to be treated as failing to meet the requirements of 
    this subsection. Such rules shall preserve freedom of choice while 
    reinforcing managed care network use by allowing a point of service 
    decision as to whether a network medical provider will be used. 
    Major elements of such rules may include, but are not limited to, 
    elements described in paragraph (3).

                     (3) Major elements of rules

        Elements described in this paragraph are--
            (A) implementing formulary for drugs and subjecting the 
        prescription program to a rigorous review of appropriate use,
            (B) obtaining a unit price discount in exchange for patient 
        volume and preferred provider status with the amount of the 
        potential discount varying by geographic region,
            (C) limiting benefit payments to physicians to the allowable 
        charge under title XVIII of the Social Security Act, while 
        protecting beneficiaries from balance billing by providers,
            (D) utilizing, in the claims payment function 
        ``appropriateness of service'' protocols under title XVIII of 
        the Social Security Act if more stringent,
            (E) creating mandatory utilization review (UR) procedures, 
        but placing the responsibility to follow such procedures on the 
        physician or hospital, not the beneficiaries,
            (F) selecting the most efficient physicians and state-of-
        the-art utilization management techniques, including ambulatory 
        care techniques, for medical services delivered by the managed 
        care network, and
            (G) utilizing a managed care network provider system, as 
        practiced in the health care industry, at the time medical 
        services are needed (point-of-service) in order to receive 
        maximum benefits available under this subsection.

                    (4) Last signatory operators

        The board of trustees of the 1992 UMWA Benefit Plan shall permit 
    any last signatory operator required to maintain an individual 
    employer plan under section 9711 to utilize the managed care and 
    cost containment rules and programs developed under this subsection 
    if the operator elects to do so.

                      (5) Standards of quality

        Any managed care system or cost containment adopted by the board 
    of trustees of the 1992 UMWA Benefit Plan or by a last signatory 
    operator may not be implemented unless it is approved by, and meets 
    the standards of quality adopted by, a medical peer review panel, 
    which has been established--
            (A) by the settlors, or
            (B) by the United Mine Workers of America and a last 
        signatory operator or group of operators.

    Standards of quality shall include accessibility to medical care, 
    taking into account that accessibility requirements may differ 
    depending on the nature of the medical need.

(d) Guarantee of benefits

                           (1) In general

        All 1988 last signatory operators shall be responsible for 
    financing the benefits described in subsection (c), in accordance 
    with contribution requirements established in the 1992 UMWA Benefit 
    Plan. Such contribution requirements, which shall be applied 
    uniformly to each 1988 last signatory operator, on the basis of the 
    number of eligible and potentially eligible beneficiaries 
    attributable to each operator, shall include:
            (A) the payment of an annual prefunding premium for all 
        eligible and potentially eligible beneficiaries attributable to 
        a 1988 last signatory operator,
            (B) the payment of a monthly per beneficiary premium by each 
        1988 last signatory operator for each eligible beneficiary of 
        such operator who is described in subsection (b)(2) and who is 
        receiving benefits under the 1992 UMWA Benefit Plan, and
            (C) the provision of security (in the form of a bond, letter 
        of credit or cash escrow) in an amount equal to a portion of the 
        projected future cost to the 1992 UMWA Benefit Plan of providing 
        health benefits for eligible and potentially eligible 
        beneficiaries attributable to the 1988 last signatory operator. 
        If a 1988 last signatory operator is unable to provide the 
        security required, the 1992 UMWA Benefit Plan shall require the 
        operator to pay an annual prefunding premium that is greater 
        than the premium otherwise applicable.

                           (2) Adjustments

        The 1992 UMWA Benefit Plan shall provide for--
            (A) annual adjustments of the per beneficiary premium to 
        cover changes in the cost of providing benefits to eligible 
        beneficiaries, and
            (B) adjustments as necessary to the annual prefunding 
        premium to reflect changes in the cost of providing benefits to 
        eligible beneficiaries for whom per beneficiary premiums are not 
        paid.

                      (3) Additional liability

        Any last signatory operator who is not a 1988 last signatory 
    operator shall pay the monthly per beneficiary premium under 
    paragraph (1)(B) for each eligible beneficiary described in such 
    paragraph attributable to that operator.

                   (4) Joint and several liability

        A 1988 last signatory operator or last signatory operator 
    described in paragraph (3), and any related person to any such 
    operator, shall be jointly and severally liable with such operator 
    for any amount required to be paid by such operator under this 
    section.

                          (5) Deductibility

        Any premium required by this section shall be deductible without 
    regard to any limitation on deductibility based on the prefunding of 
    health benefits.

                  (6) 1988 last signatory operator

        For purposes of this section, the term ``1988 last signatory 
    operator'' means a last signatory operator which is a 1988 agreement 
    operator.

(Added Pub. L. 102-486, title XIX, Sec. 19143(a), Oct. 24, 1992, 106 
Stat. 3053.)

                       References in Text

    The Social Security Act, referred to in subsec. (c)(3)(C), (D), is 
act Aug. 14, 1935, ch. 531, 49 Stat. 620, as amended. Title XVIII of the 
Act is classified generally to subchapter XVIII (Sec. 1395 et seq.) of 
chapter 7 of Title 42, The Public Health and Welfare. For complete 
classification of this Act to the Code, see section 1305 of Title 42 and 
Tables.

                  Section Referred to in Other Sections

    This section is referred to in sections 9701, 9711 of this title.
