text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Medicare/Medicaid Solvency Act''.
  
  SEC. 2. FINDINGS AND PURPOSE.
  
      (a) Findings.--The Congress finds that--
              (1) illnesses and diseases that result from the use of 
          tobacco products cost Federal Government health care programs 
          billions of dollars, including $10,200,000,000 in the medicare 
          program, $5,100,000,000 in the medicaid program, and 
          $4,700,000,000 in other Federal health programs in fiscal year 
          1993;
              (2) in April 1994, the trustees of the medicare trust funds 
          concluded that such funds may be insolvent in 2001;
              (3) such insolvency would severely affect the ability of 
          the medicare trust funds to continue to protect the health of 
          America's senior citizens; and
              (4) the medicare population has a significantly higher risk 
          of contracting illnesses and diseases that result from the use 
          of tobacco products than younger age groups.
      (b) Purpose.--The purpose of this Act is to insure the long-term 
  viability of the medicare, medicaid, and other federal health programs 
  by establishing a dedicated trust fund to reimburse the government for 
  the health care costs of individuals with diseases attributable to the 
  use of tobacco products.
  
  SEC. 3. TOBACCO PRODUCT MANUFACTURERS CONTRIBUTION TO HEALTH CARE COST 
                REIMBURSEMENT TRUST FUND.
  
      (a) In General.--The Internal Revenue Code of 1986 is amended by 
  adding at the end the following new subtitle:
  
  ``Subtitle K--Tobacco Product Manufacturers Contribution to Health Care 
                       Cost Reimbursement Trust Fund.
  
                                ``Chapter 100. Tobacco Product 
                                          Manufacturers Contribution to 
                                          Health Care Cost Reimbursement 
                                          Trust Fund.
  
    ``CHAPTER 100--TOBACCO PRODUCT MANUFACTURERS CONTRIBUTION TO HEALTH 
                    CARE COST REIMBURSEMENT TRUST FUND.
  
                                ``Sec. 9801. Establishment of Tobacco 
                                          Product Health Care Cost 
                                          Reimbursement Trust Fund.
                                ``Sec. 9802. Contributions to Trust Fund.
  
  ``SEC. 9801. ESTABLISHMENT OF TOBACCO PRODUCT HEALTH CARE COST 
                REIMBURSEMENT TRUST FUND.
  
      ``(a) Creation of Trust Fund.--There is established in the Treasury 
  of the United States a trust fund to be known as the `Tobacco Product 
  Health Care Cost Reimbursement Trust Fund' (hereafter referred to in 
  this chapter as the `Trust Fund'), consisting of such amounts as may be 
  appropriated or transferred to the Trust Fund as provided in this 
  section or section 9602(b).
      ``(b) Transfers to Trust Fund.--The Secretary shall transfer to the 
  Trust Fund an amount equivalent to contributions received in the 
  Treasury under section 9802.
      ``(c) Distribution of Amounts in Trust Fund.--
              ``(1) In general.--The amounts in the Trust Fund shall be 
          available in each fiscal year (beginning with fiscal year 
          1997), as provided by appropriation Acts, to the Secretary--
                      ``(A) to distribute to each particular Secretary 
                  responsible for the expenditure of Federal funds for 
                  that fiscal year under title XVIII or XIX of the Social 
                  Security Act or any other Federal program for the 
                  payment of health care costs of individuals with 
                  diseases attributable to the use of tobacco products, 
                  and
                      ``(B) to pay all expenses of administration 
                  incurred by the Department of the Treasury in 
                  administering this chapter and the Trust Fund.
              ``(2) Determination of distribution.--Each particular 
          Secretary described in paragraph (1)(A) shall submit to the 
          Secretary of the Treasury such documentation as the Secretary 
          requires to determine the appropriate distribution under 
          paragraph (1)(A).
              ``(3) Use of distributions.--In any case in which an 
          expenditure of Federal funds described in paragraph (1)(A) was 
          made from a trust fund, the distribution under paragraph (1)(A) 
          reimbursing such expenditure shall be made to such trust fund.
              ``(4) State medicaid expenditures.--For purposes of this 
          section, the Secretary of Health and Human Services shall 
          include in the Secretary's submission under paragraph (2) the 
          expenditure of State funds under State plans under title XIX of 
          the Social Security Act for the payment of health care costs of 
          individuals with diseases attributable to the use of tobacco 
          products, and to the extent the distribution to the Secretary 
          under paragraph (1)(A) is attributable to such expenditure, 
          shall reimburse the various States for such expenditures.
      ``(d) Administrative Rules.--For purposes of this section, the 
  rules of subchapter B of chapter 98 shall apply.
      ``(e) Tobacco Products.--For purposes of this chapter, the term 
  `tobacco products' has the meaning given such term by section 5702(c).
  
  ``SEC. 9802. CONTRIBUTIONS TO TRUST FUND.
  
      ``(a) Annual Premiums.--Each manufacturer of tobacco products shall 
  pay to the Trust Fund, an annual contribution equal to the product of 
  the amount determined under subsection (b) for each fiscal year 
  (beginning with fiscal year 1997) and the manufacturer's market share 
  percentage determined under subsection (c) for the calendar year 
  preceding such fiscal year.
      ``(b) Determination of Funding Levels.--
              ``(1) In general.--Not later than the date the President is 
          required to submit the budget of the United States for a fiscal 
          year to Congress, the Director of the Centers for Disease 
          Control and Prevention, after consultation with the Directors 
          of the National Institutes of Health, the National Cancer 
          Institute, and the National Heart, Lung, and Blood Institute, 
          shall make an estimate of--
                      ``(A) the amount of Federal expenditures for that 
                  fiscal year under titles XVIII and XIX of the Social 
                  Security Act and other Federal programs, and
                      ``(B) the amount of State expenditures for that 
                  fiscal year under State plans under title XIX of the 
                  Social Security Act,
          for payment of health care costs of individuals with diseases 
          attributable to the use of tobacco products.
              ``(2) Disclosure of estimate methodology.--The Director of 
          the Centers for Disease Control and Prevention shall publish in 
          the Federal Register all relevant documentation considered and 
          the methodology used in making the estimate described in 
          paragraph (1).
              ``(3) Report in budget.--The President shall include the 
          estimate described in paragraph (1) in the budget for the 
          fiscal year.
      ``(c) Market Share Percentage.--
              ``(1) In general.--Not later than July 1, the Secretary 
          shall determine and publish the market share percentage for the 
          preceding calendar year for each manufacturer of tobacco 
          products by determining such manufacturer's percentage share of 
          the total amount of tobacco products sold in the United States 
          during such calendar year.
              ``(2) Information.--Not later than April 1, each 
          manufacturer of tobacco products shall furnish to the Secretary 
          such information as the Secretary may require to determine any 
          market share percentage under this subsection for the preceding 
          calendar year.
      ``(d) Payment of Contributions.--The annual contribution under 
  subsection (a) for any fiscal year shall be payable in 12 monthly 
  installments, due on the twenty-fifth day of each calendar month in the 
  fiscal year.
      ``(e) Enforcement.--For penalties and other general and 
  administrative provisions applicable to this section, see subtitle F.
      ``(f) Manufacturer of Tobacco Products.--For purposes of this 
  section, the term `manufacturer of tobacco products' has the meaning 
  given such term by section 5702(d).''
      (b) Effective Date.--The amendments made by this section shall take 
  effect on the date of the enactment of this Act.
target: Medicare/Medicaid Solvency Act - Amends the Internal Revenue Code to establish in the Treasury the Tobacco Product Health Care Cost Reimbursement Trust Fund.  Directs the Secretary of the Treasury to:  (1) distribute amounts in the Fund to each Secretary responsible for the expenditure of Federal funds for that fiscal year (beginning with FY 1997) under titles XXVIII (Medicare) and XIX (Medicaid) of the Social Security Act or any other Federal program for the payment of health care costs for individuals with diseases attributable to the use of tobacco products; and (2) pay administrative expenses of the Fund. 
  Requires each manufacturer of tobacco products to pay to the Fund an annual contribution based on the total amount of tobacco-related Federal health care costs in proportion to that manufacturer's share of the tobacco market.
feat_title: Medicare/Medicaid Solvency Act