II

106TH CONGRESS

2D SESSION S. 2274

To amend title XIX of the Social Security Act to provide families of disabled

children with the opportunity to purchase coverage under the medicaid

program for such children, and for other purposes.

IN THE SENATE OF THE UNITED STATES

MARCH 22, 2000

Mr. GRASSLEY (for himself, Mr. KENNEDY, Mr. JEFFORDS, Mr. HARKIN, Mr.

REED, and Mr. MOYNIHAN) introduced the following bill; which was read

twice and referred to the Committee on Finance

A BILL

To amend title XIX of the Social Security Act to provide

families of disabled children with the opportunity to purchase coverage under the medicaid program for such

children, 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,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Family Opportunity

5 Act of 2000’’.
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1 SEC. 2. OPPORTUNITY FOR FAMILIES OF DISABLED CHIL2 DREN TO PURCHASE MEDICAID COVERAGE

3 FOR SUCH CHILDREN.

4 (a) STATE OPTION TO ALLOW FAMILIES OF DIS5 ABLED CHILDREN TO PURCHASE MEDICAID COVERAGE

6 FOR SUCH CHILDREN.—

7 (1) IN GENERAL.—Section 1902 of the Social

8 Security Act (42 U.S.C. 1396a), as amended by the

9 Foster Care Independence Act of 1999 (Public Law

10 106–169; 113 Stat. 1822) and the Ticket to Work

11 and Work Incentives Improvement Act of 1999

12 (Public Law 106–170; 113 Stat. 1860), is

13 amended—

14 (A) in subsection (a)(10)(A)(ii)—

15 (i) by striking ‘‘or’’ at the end of sub16 clause (XVI);

17 (ii) by adding ‘‘or’’ at the end of sub18 clause (XVII); and

19 (iii) by adding at the end the fol20 lowing new subclause:

21 ‘‘(XVIII) who are disabled chil22 dren described in subsection (aa);’’;

23 and

24 (B) by adding at the end the following new

25 subsection:
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1 ‘‘(aa)(1) Individuals described in this subsection are

2 individuals—

3 ‘‘(A) who have not attained 21 years of age;

4 ‘‘(B) who would be considered disabled under

5 section 1614(a)(3)(C) (determined without regard to

6 the reference to age in that section) but for having

7 family income or resources (as determined under

8 title XVI for children) that exceed the requirements

9 for receipt of supplemental security income benefits;

10 and

11 ‘‘(C) whose family income (as so determined)

12 does not exceed—

13 ‘‘(i) 600 percent of the income official pov14 erty line (as defined by the Office of Manage15 ment and Budget, and revised annually in ac16 cordance with section 673(2) of the Omnibus

17 Budget Reconciliation Act of 1981) applicable

18 to a family of the size involved; or

19 ‘‘(ii) such higher percent of such poverty

20 line as a State may establish, except that no

21 Federal financial participation shall be provided

22 under section 1903(a) for any medical assist23 ance provided to an individual who would not be

24 described in this subsection but for this clause.
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1 ‘‘(2) A State shall provide the same amount, dura2 tion, and scope of medical assistance under the State plan

3 to an individual described in paragraph (1) who has at4 tained age 18 but has not attained age 21 as the State

5 provides under the State plan to an individual who has

6 not attained age 18.’’.

7 (2) INTERACTION WITH EMPLOYER-SPONSORED

8 FAMILY COVERAGE.—Section 1902(aa) of the Social

9 Security Act (42 U.S.C. 1396a(aa)), as added by

10 paragraph (1), is amended by adding at the end the

11 following new paragraph:

12 ‘‘(3)(A) If an employer of a parent or caretaker rel13 ative of an individual described in paragraph (1) offers

14 family coverage under a group health plan (as defined in

15 section 2791(a) of the Public Health Service Act), the

16 State shall—

17 ‘‘(i) require such parent or caretaker relative to

18 apply for, enroll in, and pay premiums for, such cov19 erage as a condition of such parent’s or caretaker

20 relative’s child being or remaining eligible for med21 ical assistance under subsection

22 (a)(10)(A)(ii)(XVIII) if the parent or caretaker rel23 ative is determined eligible for such coverage and the

24 employer contributes more than 40 percent of the
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1 total cost of annual premiums for such coverage;

2 and

3 ‘‘(ii) if such coverage is obtained—

4 ‘‘(I) subject to paragraph (2) of section

5 1916(h), reduce the premium imposed by the

6 State under that section (if any) in an amount

7 that is based on the amount of the parent or

8 caretaker relative’s contribution for such cov9 erage, the actuarial value of the medical assist10 ance provided to such parent or caretaker rel11 ative’s child, or both; and

12 ‘‘(II) treat such coverage as a third party

13 liability under subsection (a)(25).

14 ‘‘(B) In the case of a parent or caretaker relative to

15 which subparagraph (A) applies—

16 ‘‘(i) if the family income (as so determined) of

17 such parent or caretaker relative does not exceed

18 300 percent of the income official poverty line (as so

19 defined), a State may provide for payment of any

20 portion of the premium for such family coverage

21 that the parent or caretaker relative is required to

22 pay for a period not to exceed 12 months; and

23 ‘‘(ii) any payments made by the State under

24 clause (i) shall be considered, for purposes of section

25 1903(a), to be payments for medical assistance.’’.
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1 (b) STATE OPTION TO IMPOSE INCOME-RELATED

2 PREMIUMS.—Section 1916 of the Social Security Act (42

3 U.S.C. 1396o), as amended by the Ticket to Work and

4 Work Incentives Improvement Act of 1999 (Public Law

5 106–170; 113 Stat. 1860), is amended—

6 (1) in subsection (a), by striking ‘‘subsection

7 (g)’’ and inserting ‘‘subsections (g) and (h)’’; and

8 (2) by adding at the end the following new sub9 section:

10 ‘‘(h)(1) With respect to disabled children provided

11 medical assistance under section

12 1902(a)(10)(A)(ii)(XVIII), subject to paragraph (2), a

13 State may (in a uniform manner for such children) require

14 the families of such children to pay monthly premiums set

15 on a sliding scale based on family income (as determined

16 under title XVI for children).

17 ‘‘(2) A premium requirement imposed under para18 graph (1) may only apply to the extent that—

19 ‘‘(A) the aggregate amount of such premium

20 and any premium that the parent or caretaker rel21 ative is required to pay for family coverage under

22 section 1902(aa)(3)(A)(i) does not exceed 7.5 per23 cent (5 percent, in the case of a family described in

24 section 1902(aa)(3)(B)(i)) of the family’s income;

25 and
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1 ‘‘(B) the requirement is imposed consistent with

2 section 1902(aa)(3)(A)(ii)(I).

3 ‘‘(3) A State shall not require prepayment of a pre4 mium imposed pursuant to paragraph (1) and shall not

5 terminate eligibility of a child under section

6 1902(a)(10)(A)(ii)(XVIII) for medical assistance under

7 this title on the basis of failure to pay any such premium

8 until such failure continues for a period of not less than

9 60 days from the date on which the premium became past

10 due. The State may waive payment of any such premium

11 in any case where the State determines that requiring

12 such payment would create an undue hardship.’’.

13 (c) INCREASED FEDERAL FINANCIAL ASSISTANCE

14 FOR ADMINISTRATIVE COSTS.—Section 1903(a)(7) of the

15 Social Security Act (42 U.S.C. 1396b(a)(7)) is amended—

16 (1) by inserting ‘‘(A)’’ after ‘‘(7)’’;

17 (2) by striking the period and inserting ‘‘,

18 and’’; and

19 (3) by adding at the end the following new sub20 clause:

21 ‘‘(B)(i) 90 percent of the sums expended during

22 such a quarter within the twelve-quarter period be23 ginning with the first quarter in which a payment is

24 made to the State pursuant to this subparagraph,

25 and
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1 ‘‘(ii) 75 percent of the sums expended during

2 each succeeding calendar quarter,

3 with respect to administrative costs incurred during

4 such quarter (as found necessary by the Secretary)

5 for providing medical assistance to disabled children

6 under section 1902(a)(10)(A)(ii)(XVIII).’’.

7 (d) CONFORMING AMENDMENT.—Section 1903(f)(4)

8 of the Social Security Act (42 U.S.C. 1396b(f)(4)) is

9 amended in the matter preceding subparagraph (A) by in10 serting ‘‘1902(a)(10)(A)(ii)(XVIII)’’ before ‘‘1905(p)(1)’’.

11 (e) EFFECTIVE DATE.—The amendments made by

12 this section shall apply to medical assistance for items and

13 services furnished on or after October 1, 2000.

14 SEC. 3. TREATMENT OF INPATIENT PSYCHIATRIC HOS15 PITAL SERVICES FOR INDIVIDUALS UNDER

16 AGE 21 IN HOME OR COMMUNITY-BASED

17 SERVICES WAIVERS.

18 (a) IN GENERAL.—Section 1915(c) of the Social Se19 curity Act (42 U.S.C. 1396n(c)) is amended—

20 (1) in paragraph (1)—

21 (A) in the first sentence, by inserting ‘‘, or

22 inpatient psychiatric hospital services for indi23 viduals under age 21,’’ after ‘‘intermediate care

24 facility for the mentally retarded’’; and
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1 (B) in the second sentence, by inserting ‘‘,

2 or inpatient psychiatric hospital services for in3 dividuals under age 21’’ before the period;

4 (2) in paragraph (2)(B), by striking ‘‘or serv5 ices in an intermediate care facility for the mentally

6 retarded’’ each place it appears and inserting ‘‘,

7 services in an intermediate care facility for the men8 tally retarded, or inpatient psychiatric hospital serv9 ices for individuals under age 21’’;

10 (3) by striking paragraph (2)(C) and inserting

11 the following:

12 ‘‘(C) such individuals who are determined to be

13 likely to require the level of care provided in a hos14 pital, nursing facility, or intermediate care facility

15 for the mentally retarded, or inpatient psychiatric

16 hospital services for individuals under age 21, are

17 informed of the feasible alternatives, if available

18 under the waiver, at the choice of such individuals,

19 to the provision of inpatient hospital services, nurs20 ing facility services, services in an intermediate care

21 facility for the mentally retarded, or inpatient psy22 chiatric hospital services for individuals under age

23 21;’’; and

24 (4) in paragraph (7)(A)—
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1 (A) by inserting ‘‘, or inpatient psychiatric

2 hospital services for individuals under age 21,’’

3 after ‘‘intermediate care facility for the men4 tally retarded’’; and

5 (B) by inserting ‘‘, or who would require

6 inpatient psychiatric hospital services for indi7 viduals under age 21’’ before the period.

8 (b) EFFECTIVE DATE.—The amendments made by

9 subsection (a) apply with respect to medical assistance

10 provided on or after October 1, 2000.

11 SEC. 4. DEMONSTRATION OF COVERAGE UNDER THE MED12 ICAID PROGRAM OF CHILDREN WITH POTEN13 TIALLY SEVERE DISABILITIES.

14 (a) STATE APPLICATION.—A State may apply to the

15 Secretary of Health and Human Services (in this section

16 referred to as the ‘‘Secretary’’) for approval of a dem17 onstration project (in this section referred to as a ‘‘dem18 onstration project’’) under which up to a specified max19 imum number of children with a potentially severe dis20 ability (as defined in subsection (b)) are provided medical

21 assistance under the State medicaid plan under title XIX

22 of the Social Security Act (42 U.S.C. 1396 et seq.).

23 (b) CHILD WITH A POTENTIALLY SEVERE DIS24 ABILITY DEFINED.—
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1 (1) IN GENERAL.—In this section, the term

2 ‘‘child with a potentially severe disability’’ means,

3 with respect to a demonstration project, an indi4 vidual who—

5 (A) has not attained 21 years of age;

6 (B) has a physical or mental condition,

7 disease, disorder (including a congenital birth

8 defect), injury, or developmental disability that

9 was incurred before the individual attained such

10 age; and

11 (C) is reasonably expected, but for the re12 ceipt of medical assistance under the State

13 medicaid plan, to reach the level of disability

14 defined under section 1614(a)(3) of the Social

15 Security Act (42 U.S.C. 1382c(a)(3)), (deter16 mined without regard to the reference to age in

17 subparagraph (C) of that section).

18 (2) EXCEPTION.—Such term does not include

19 an individual who would be considered disabled

20 under section 1614(a)(3)(C) of the Social Security

21 Act (42 U.S.C. 1382c(a)(3)(C)) (determined without

22 regard to the reference to age in that section).

23 (c) APPROVAL OF DEMONSTRATION PROJECTS.—

24 (1) IN GENERAL.—Subject to paragraph (3),

25 the Secretary shall approve applications under sub-
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1 section (a) that meet the requirements of paragraph

2 (2) and such additional terms and conditions as the

3 Secretary may require. The Secretary may waive the

4 requirement of section 1902(a)(1) of the Social Se5 curity Act (42 U.S.C. 1396a(a)(1)) to allow for sub6 State demonstrations.

7 (2) TERMS AND CONDITIONS OF DEMONSTRA8 TION PROJECTS.—The Secretary may not approve a

9 demonstration project under this section unless the

10 State provides assurances satisfactory to the Sec11 retary that the following conditions are or will be

12 met:

13 (A) INDEPENDENT EVALUATION.—The

14 State provides for an independent evaluation of

15 the project to be conducted during fiscal year

16 2005.

17 (B) CONSULTATION FOR DEVELOPMENT

18 OF CRITERIA.—The State consults with appro19 priate pediatric health professionals in estab20 lishing the criteria for determining whether a

21 child has a potentially severe disability.

22 (C) ANNUAL REPORT.—The State submits

23 an annual report to the Secretary (in a uniform

24 form and manner established by the Secretary)
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1 on the use of funds provided under the grant

2 that includes the following:

3 (i) Enrollment and financial statistics

4 on—

5 (I) the total number of children

6 with a potentially severe disability en7 rolled in the demonstration project,

8 disaggregated by disability;

9 (II) the services provided by cat10 egory or code and the cost of each

11 service so categorized or coded; and

12 (III) the number of children en13 rolled in the demonstration project

14 who also receive services through pri15 vate insurance.

16 (ii) With respect to the report sub17 mitted for fiscal year 2005, the results of

18 the independent evaluation conducted

19 under subparagraph (A).

20 (iii) Such additional information as

21 the Secretary may require.

22 (3) LIMITATIONS ON FEDERAL FUNDING.—

23 (A) APPROPRIATION.—

24 (i) IN GENERAL.—Out of any funds in

25 the Treasury not otherwise appropriated,
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1 there is appropriated to carry out this sec2 tion $50,000,000 for each of fiscal years

3 2001 through 2006.

4 (ii) BUDGET AUTHORITY.—Clause (i)

5 constitutes budget authority in advance of

6 appropriations Acts and represents the ob7 ligation of the Federal Government to pro8 vide for the payment of the amounts ap9 propriated under clause (i).

10 (B) LIMITATION ON PAYMENTS.—In no

11 case may—

12 (i) the aggregate amount of payments

13 made by the Secretary to States under this

14 section exceed $300,000,000;

15 (ii) the aggregate amount of payments

16 made by the Secretary to States for ad17 ministrative expenses relating to the eval18 uations and annual reports required under

19 subparagraphs (B) and (D) of paragraph

20 (2) exceed $6,000,000 of such

21 $300,000,000; or

22 (iii) payments be provided by the Sec23 retary for a fiscal year after fiscal year

24 2009.

25 (C) FUNDS ALLOCATED TO STATES.—
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1 (i) IN GENERAL.—The Secretary shall

2 allocate funds to States based on their ap3 plications and the availability of funds. In

4 making such allocations, the Secretary

5 shall ensure an equitable distribution of

6 funds among States with large populations

7 and States with small populations.

8 (ii) AVAILABILITY.—Funds allocated

9 to a State under a grant made under this

10 section for a fiscal year shall remain avail11 able until expended.

12 (D) FUNDS NOT ALLOCATED TO STATES.—

13 Funds not allocated to States in the fiscal year

14 for which they are appropriated shall remain

15 available in succeeding fiscal years for alloca16 tion by the Secretary using the allocation for17 mula established under this section.

18 (E) PAYMENTS TO STATES.—The Sec19 retary shall pay to each State with a dem20 onstration project approved under this section,

21 from its allocation under subparagraph (C), an

22 amount for each quarter equal to the Federal

23 medical assistance percentage (as defined in

24 section 1905(b) of the Social Security Act (42

25 U.S.C. 1395d(b))) of expenditures in the quar-
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1 ter for medical assistance provided to children

2 with a potentially severe disability.

3 (d) RECOMMENDATION.—Not later than October 1,

4 2004, the Secretary shall submit a recommendation to the

5 Committee on Commerce of the House of Representatives

6 and the Committee on Finance of the Senate regarding

7 whether the demonstration project established under this

8 section should be continued after fiscal year 2006.

9 (e) STATE DEFINED.—In this section, the term

10 ‘‘State’’ has the meaning given such term for purposes of

11 title XIX of the Social Security Act (42 U.S.C. 1396 et

12 seq.).

13 SEC. 5. DEVELOPMENT AND SUPPORT OF FAMILY-TO-FAM14 ILY HEALTH INFORMATION CENTERS.

15 Section 501 of the Social Security Act (42 U.S.C.

16 701) is amended by adding at the end the following new

17 subsection:

18 ‘‘(c)(1)(A) In addition to amounts appropriated

19 under subsection (a) and retained under section 502(a)(1)

20 for the purpose of carrying out activities described in sub21 section (a)(2), there is appropriated to the Secretary, out

22 of any money in the Treasury not otherwise appropriated,

23 for the purpose of enabling the Secretary (through grants,

24 contracts, or otherwise) to provide for special projects of

25 regional and national significance for the development and
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1 support of family-to-family health information centers de2 scribed in paragraph (2), $10,000,000 for each of fiscal

3 years 2001 through 2006.

4 ‘‘(B) Funds appropriated under subparagraph (A)

5 shall remain available until expended.

6 ‘‘(2) The family-to-family health information centers

7 described in this paragraph are centers that—

8 ‘‘(A) assist families of children with disabilities

9 or special health care needs to make informed

10 choices about health care in order to promote good

11 treatment decisions, cost-effectiveness, and improved

12 health outcomes for such children;

13 ‘‘(B) provide information regarding the health

14 care needs of, and resources available for, children

15 with disabilities or special health care needs;

16 ‘‘(C) identify successful health delivery models

17 for such children;

18 ‘‘(D) develop with representatives of health care

19 providers, managed care organizations, health care

20 purchasers, and appropriate State agencies a model

21 for collaboration between families of such children

22 and health professionals;

23 ‘‘(E) provide training and guidance regarding

24 caring for such children;
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1 ‘‘(F) conduct outreach activities to the families

2 of such children, health professionals, schools, and

3 other appropriate entities and individuals; and

4 ‘‘(G) are staffed by families of children with

5 disabilities or special health care needs who have ex6 pertise in Federal and State public and private

7 health care systems and health professionals.

8 ‘‘(3) The provisions of this title that are applicable

9 to the funds made available to the Secretary under section

10 502(a)(1) apply in the same manner to funds made avail11 able to the Secretary under paragraph (1).’’.

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