Common Sense Savings Act of 2016

Summary: Common Sense Savings Act of 2016 This bill amends title XIX (Medicaid) of the Social Security Act (SSAct) to specify how a state must treat&nbsp;qualified lottery winnings and lump sum income for purposes of determining an individual's income-based eligibility for a state Medicaid program. Specifically, a state shall include such winnings or income as income received: (1) in the month in which it was received, if the amount is less than $60,000; (2) over a period of two months, if the amount is at least $60,000 but less than $70,000; (3) over a period of three months, if the amount is at least $70,000 but less than $80,000; and (4) over an additional one-month period for each increment of $10,000 received, not to exceed 120 months. Qualified lump sum income includes: (1) monetary winnings from gambling; (2) damages&nbsp;received&nbsp;in lump sums or periodic payments,&nbsp;excluding monthly payments, on account of causes of action other than those arising from personal physical injuries or sickness; and (3) income received as liquid assets from the estate of a deceased individual. In addition, the&nbsp;bill eliminates the enhanced Federal&nbsp;Medical Assistance Percentage (FMAP)&nbsp;with respect to the coverage of&nbsp;individuals who are inmates in public institutions.&nbsp;Under current law, the enhanced FMAP&nbsp;applies to coverage of individuals who are newly eligible for Medicaid under the Patient Protection and Affordable Care Act (PPACA). The bill also amends title XXI (Children's Health Insurance Program [CHIP]) of the SSAct to terminate increases to the enhanced FMAP as established by the PPACA with respect to CHIP. Under current law, federal Medicaid reimbursement to states is reduced in proportion to any impermissible state taxes collected from health care providers. The bill lowers a percentage threshold used to determine whether such taxes are impermissible.  The bill terminates the Prevention and Public Health Fund.

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Common Sense 
Savings Act of 2016''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Treatment of lottery winnings and other lump-sum income for 
                            purposes of income eligibility under 
                            Medicaid.
Sec. 3. Eliminating PPACA enhanced Medicaid FMAP for prisoners.
Sec. 4. Extending previous Medicaid threshold applied for determining 
                            acceptable provider taxes.
Sec. 5. Sunsetting PPACA increase in enhanced FMAP under CHIP.
Sec. 6. Repeal of the Prevention and Public Health Fund.

SEC. 2. TREATMENT OF LOTTERY WINNINGS AND OTHER LUMP-SUM INCOME FOR 
              PURPOSES OF INCOME ELIGIBILITY UNDER MEDICAID.

    (a) In General.--Section 1902 of the Social Security Act (42 U.S.C. 
1396a) is amended--
            (1) in subsection (a)(17), by striking ``(e)(14), (e)(14)'' 
        and inserting ``(e)(14), (e)(15)''; and
            (2) in subsection (e)--
                    (A) in paragraph (14) (relating to modified 
                adjusted gross income), by adding at the end the 
                following new subparagraph:
                    ``(J) Treatment of certain lottery winnings and 
                income received as a lump sum.--
                            ``(i) In general.--In the case of an 
                        individual who is the recipient of qualified 
                        lottery winnings (pursuant to lotteries 
                        occurring on or after January 1, 2018) or 
                        qualified lump sum income (received on or after 
                        such date) and whose eligibility for medical 
                        assistance is determined based on the 
                        application of modified adjusted gross income 
                        under subparagraph (A), a State shall, in 
                        determining such eligibility, include such 
                        winnings or income (as applicable) as income 
                        received--
                                    ``(I) in the month in which such 
                                winnings or income (as applicable) is 
                                received if the amount of such winnings 
                                or income is less than $60,000;
                                    ``(II) over a period of 2 months if 
                                the amount of such winnings or income 
                                (as applicable) is greater than or 
                                equal to $60,000 but less than $70,000;
                                    ``(III) over a period of 3 months 
                                if the amount of such winnings or 
                                income (as applicable) is greater than 
                                or equal to $70,000 but less than 
                                $80,000; and
                                    ``(IV) over a period of 3 months 
                                plus 1 additional month for each 
                                increment of $10,000 of such winnings 
                                or income (as applicable) received, not 
                                to exceed a period of 120 months (for 
                                winnings or income of $1,240,000 or 
                                more), if the amount of such winnings 
                                or income is greater than or equal to 
                                $80,000.
                            ``(ii) Counting in equal installments.--For 
                        purposes of subclauses (II), (III), and (IV) of 
                        clause (i), winnings or income to which such 
                        subclause applies shall be counted in equal 
                        monthly installments over the period of months 
                        specified under such subclause.
                            ``(iii) Qualified lottery winnings 
                        defined.--In this subparagraph, the term 
                        `qualified lottery winnings' means winnings 
                        from a sweepstakes, lottery, or pool described 
                        in paragraph (3) of section 4402 of the 
                        Internal Revenue Code of 1986 or a lottery 
                        operated by a multistate or multijurisdictional 
                        lottery association, including amounts awarded 
                        as a lump sum payment.
                            ``(iv) Qualified lump sum income defined.--
                        In this subparagraph, the term `qualified lump 
                        sum income' means income that is received as a 
                        lump sum from one of the following sources:
                                    ``(I) Monetary winnings from 
                                gambling (as defined by the Secretary 
                                and including gambling activities 
                                described in section 1955(b)(4) of 
                                title 18, United States Code).
                                    ``(II) Damages received, whether by 
                                suit or agreement and whether as lump 
                                sums or as periodic payments (other 
                                than monthly payments), on account of 
                                causes of action other than causes of 
                                action arising from personal physical 
                                injuries or physical sickness.
                                    ``(III) Income received as liquid 
                                assets from the estate (as defined in 
                                section 1917(b)(4)) of a deceased 
                                individual.''; and
                    (B) by striking ``(14) Exclusion'' and inserting 
                ``(15) Exclusion''.
    (b) Rule of Construction.--Nothing in the amendment made by 
subsection (a)(2)(A) shall be construed as preventing a State from 
intercepting the State lottery winnings awarded to an individual in the 
State to recover amounts paid by the State under the State Medicaid 
plan under title XIX of the Social Security Act for medical assistance 
furnished to the individual.

SEC. 3. ELIMINATING PPACA ENHANCED MEDICAID FMAP FOR PRISONERS.

    Section 1905 of the Social Security Act (42 U.S.C. 1396d) is 
amended--
            (1) in subsection (y)(2)(A), by adding at the end the 
        following: ``For items and services furnished on or after 
        January 1, 2017, such term does not include an individual 
        during the period in which the individual is an inmate in a 
        public institution and is a patient in a medical 
        institution.''; and
            (2) in subsection (z)(2)(A), by adding at the end the 
        following: ``For calendar quarters beginning on or after 
        January 1, 2017, the preceding sentence shall not apply with 
        respect to medical assistance for individuals who are inmates 
        in a public institution and patients in a medical 
        institution.''.

SEC. 4. EXTENDING PREVIOUS MEDICAID THRESHOLD APPLIED FOR DETERMINING 
              ACCEPTABLE PROVIDER TAXES.

    Section 1903(w)(4)(C)(ii) of the Social Security Act (42 U.S.C. 
1396b(w)(4)(C)(ii)) is amended by inserting after ``October 1, 2011,'' 
the following: ``and for portions of fiscal years occurring on or after 
January 1, 2017''.

SEC. 5. SUNSETTING PPACA INCREASE IN ENHANCED FMAP UNDER CHIP.

    (a) In General.--The second sentence of section 2105(b) of the 
Social Security Act (42 U.S.C. 1397ee(b)) is amended by striking 
``September 30, 2019'' and inserting ``March 31, 2016''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply with respect to items and services furnished after March 31, 
2016, without regard to whether this Act is enacted after such date.

SEC. 6. REPEAL OF THE PREVENTION AND PUBLIC HEALTH FUND.

    (a) In General.--Section 4002 of the Patient Protection and 
Affordable Care Act (42 U.S.C. 300u-11) is repealed.
    (b) Rescission of Unobligated Funds.--Of the funds made available 
by such section 4002, the unobligated balance is rescinded.