114TH CONGRESS 

2D SESSION H. R. 670 

AN ACT 

To amend title XIX of the Social Security Act to extend 

the Medicaid rules regarding supplemental needs trusts 

for Medicaid beneficiaries to trusts established by those 

beneficiaries, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 
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1 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

2 (a) SHORT TITLE.—This Act may be cited as the 

3 ‘‘Special Needs Trust Fairness and Medicaid Improve4 ment Act’’. 

5 (b) TABLE OF CONTENTS.—The table of contents of 

6 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Fairness in Medicaid supplemental needs trusts. 

Sec. 3. Medicaid coverage of tobacco cessation services for mothers of 

newborns. 

Sec. 4. Eliminating Federal financial participation with respect to expenditures 

under Medicaid for agents used for cosmetic purposes or hair 

growth. 

Sec. 5. Medicaid Improvement Fund. 

7 SEC. 2. FAIRNESS IN MEDICAID SUPPLEMENTAL NEEDS 

8 TRUSTS. 

9 (a) IN GENERAL.—Section 1917(d)(4)(A) of the So10 cial Security Act (42 U.S.C. 1396p(d)(4)(A)) is amended 

11 by inserting ‘‘the individual,’’ after ‘‘for the benefit of such 

12 individual by’’. 

13 (b) EFFECTIVE DATE.—The amendment made by 

14 subsection (a) shall apply to trusts established on or after 

15 the date of the enactment of this Act. 

16 SEC. 3. MEDICAID COVERAGE OF TOBACCO CESSATION 

17 SERVICES FOR MOTHERS OF NEWBORNS. 

18 (a) IN GENERAL.—Section 1905(bb) of the Social Se19 curity Act (42 U.S.C. 1396d(bb)) is amended by adding 

20 at the end the following new paragraph: 

21 ‘‘(4) A woman shall continue to be treated as de22 scribed in this subsection as a pregnant woman through 
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1 the end of the 1-year period beginning on the date of the 

2 birth of a child of the woman.’’. 

3 (b) CONFORMING AMENDMENTS.— 

4 (1) Subsections (a)(2)(B) and (b)(2)(B) of sec5 tion 1916 of the Social Security Act (42 U.S.C. 

6 1396o) are each amended by inserting ‘‘(and women 

7 described in section 1905(bb) as pregnant women 

8 pursuant to paragraph (4) of such section)’’ after 

9 ‘‘tobacco cessation by pregnant women’’. 

10 (2) Section 1927(d)(2)(F) of the Social Secu11 rity Act (42 U.S.C. 1396r–8(d)(2)(F)) is amended 

12 by inserting ‘‘(and women described in section 

13 1905(bb) as pregnant women pursuant to paragraph 

14 (4) of such section)’’ after ‘‘pregnant women’’. 

15 (c) EFFECTIVE DATE.— 

16 (1) IN GENERAL.—Subject to paragraph (2), 

17 the amendments made by this section shall apply 

18 with respect to items and services furnished on or 

19 after the date that is 2 years after the date of the 

20 enactment of this Act. 

21 (2) EXCEPTION FOR STATE LEGISLATION.—In 

22 the case of a State plan under title XIX of the So23 cial Security Act, which the Secretary of Health and 

24 Human Services determines requires State legisla25 tion in order for the plan to meet any requirement 
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1 imposed by amendments made by this section, the 

2 plan shall not be regarded as failing to comply with 

3 the requirements of such title solely on the basis of 

4 its failure to meet such an additional requirement 

5 before the first day of the first calendar quarter be6 ginning after the close of the first regular session of 

7 the State legislature that begins after the effective 

8 date specified in paragraph (1). For purposes of the 

9 previous sentence, in the case of a State that has a 

10 2-year legislative session, each year of the session 

11 shall be considered to be a separate regular session 

12 of the State legislature. 

13 (d) REPORT.—Not later than 2 years after the date 

14 of the enactment of this Act, the Inspector General of the 

15 Department of Health and Human Services shall submit 

16 to Congress a report that assesses the use of the tobacco 

17 cessation service benefit under the Medicaid program. 

18 Such report shall include an assessment of— 

19 (1) the extent that States are encouraging the 

20 use of such benefit, such as through promotion of 

21 beneficiary and provider awareness of such benefit; 

22 and 

23 (2) gaps in the delivery of such benefit. 
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1 SEC. 4. ELIMINATING FEDERAL FINANCIAL PARTICIPATION 

2 WITH RESPECT TO EXPENDITURES UNDER 

3 MEDICAID FOR AGENTS USED FOR COSMETIC 

4 PURPOSES OR HAIR GROWTH. 

5 (a) IN GENERAL.—Section 1903(i)(21) of the Social 

6 Security Act (42 U.S.C. 1396b(i)(21)) is amended by in7 serting ‘‘section 1927(d)(2)(C) (relating to drugs when 

8 used for cosmetic purposes or hair growth), except where 

9 medically necessary, and’’ after ‘‘drugs described in’’. 

10 (b) EFFECTIVE DATE.—The amendment made by 

11 subsection (a) shall apply with respect to calendar quar12 ters beginning on or after the date of the enactment of 

13 this Act. 

14 SEC. 5. MEDICAID IMPROVEMENT FUND. 

15 Section 1941(b) of the Social Security Act (42 U.S.C. 

16 1396w–1(b)) is amended— 

17 (1) in paragraph (2)— 

18 (A) by striking ‘‘under paragraph (1)’’ and 

19 inserting ‘‘under this subsection’’; and 

20 (B) by redesignating such paragraph as 

21 paragraph (3); and 

22 (2) by inserting after paragraph (1) the fol23 lowing new paragraph: 

24 ‘‘(2) ADDITIONAL FUNDING.—In addition to 

25 any funds otherwise made available to the Fund, 
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1 there shall be available to the Fund, for expendi2 tures from the Fund— 

3 ‘‘(A) for fiscal year 2021, $10,000,000, to 

4 remain available until expended; and 

5 ‘‘(B) for fiscal year 2022, $14,000,000, to 

6 remain available until expended.’’. 

Passed the House of Representatives September 20, 

2016. 

Attest: 

Clerk. 

114TH CONGRESS 

2D SESSION H. R. 670 

AN ACT 

To amend title XIX of the Social Security Act to 

other purposes. trusts established by those beneficiaries, and for mental needs trusts for Medicaid beneficiaries to extend the Medicaid rules regarding supple-