II 

111TH CONGRESS 

1ST SESSION S. 1217 

To amend title XIX of the Social Security Act to improve and protect 

rehabilitative services and case management services provided under Medicaid to improve the health and welfare of the Nation’s most vulnerable 

seniors and children. 

IN THE SENATE OF THE UNITED STATES 

JUNE 9, 2009 

Ms. STABENOW (for herself, Mrs. LINCOLN, and Mr. BEGICH) 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 improve 

and protect rehabilitative services and case management 

services provided under Medicaid to improve the health 

and welfare of the Nation’s most vulnerable seniors and 

children. 

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; TABLE OF CONTENTS. 

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

5 ‘‘Medicaid Services Restoration Act of 2009’’. 

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

7 this Act is as follows: 


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Sec. 1. Short title; table of contents. 

TITLE I—REHABILITATIVE SERVICES PROTECTIONS 

Sec. 101. Inclusion of therapeutic foster care as medical assistance. 

Sec. 102. Reasonable and efficient payment methodologies for rehabilitative 

services. 

Sec. 103. Inclusion of attainment and retention of functional status in rehabilitative services. 

Sec. 104. Clarification of coverage of EPSDT services for children receiving inpatient psychiatric hospital services. 

Sec. 105. Third party liability clarification relating to diagnostic, screening, 

preventive, and rehabilitative services. 

Sec. 106. Effective date. 

TITLE II—CASE MANAGEMENT AND TARGETED CASE 

MANAGEMENT PROTECTIONS 

Sec. 201. Third party liability clarification relating to case management and 

targeted case management. 

Sec. 202. Reasonable and efficient payment methodologies for case management services. 

Sec. 203. Protecting health and safety. 

Sec. 204. Codification of Olmstead standard; protecting children. 

Sec. 205. Assuring appropriate case management. 

Sec. 206. Effective date. 

1 TITLE I—REHABILITATIVE 

2 SERVICES PROTECTIONS 

3 SEC. 101. INCLUSION OF THERAPEUTIC FOSTER CARE AS 

4 MEDICAL ASSISTANCE. 

5 Section 1905 of the Social Security Act (42 U.S.C. 

6 1396d) is amended— 

7 (1) in subsection (a)— 

8 (A) in paragraph (27), by striking ‘‘and’’ 

9 at the end; 

10 (B) by redesignating paragraph (28) as 

11 paragraph (29); and 

12 (C) by inserting after paragraph (27) the 

13 following new paragraph: 


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1 ‘‘(28) therapeutic foster care services described 

2 in subsection (y); and’’; and 

3 (2) by adding at the end the following new sub4 section: 

5 ‘‘(y)(1) For purposes of subsection (a)(28), thera6 peutic foster care services described in this subsection are 

7 services provided for children who have not attained age 

8 21, and, as a result of mental illness, other emotional or 

9 behavioral disorders, medically fragile conditions, or devel10 opmental disabilities need the level of care normally pro11 vided in an institution (including a psychiatric residential 

12 treatment facility) or nursing facility but who can be cared 

13 for in a community placement, through therapeutic foster 

14 care programs that— 

15 ‘‘(A) are licensed by the State and accredited 

16 by the Joint Commission on Accreditation of 

17 Healthcare Organizations, the Commission on Ac18 creditation of Rehabilitation Facilities, or the Coun19 cil on Accreditation; 

20 ‘‘(B) provide structured daily activities, includ21 ing the development, improvement, monitoring, and 

22 reinforcing of age-appropriate social, communication 

23 and behavioral skills, crisis intervention and crisis 

24 support services, medication monitoring, counseling, 


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1 and case management, and may furnish other inten2 sive community services; and 

3 ‘‘(C) provide foster care parents with special4 ized training and consultation in the management of 

5 children with mental illness, other emotional or be6 havioral disorders, medically fragile conditions, or 

7 developmental disabilities, and specific additional 

8 training on the needs of each child provided such 

9 services. 

10 ‘‘(2) In making coverage determinations under para11 graph (1), a State may employ medical necessity criteria 

12 that are similar to the medical necessity criteria applied 

13 to coverage determinations for other services and supports 

14 under this title.’’. 

15 SEC. 102. REASONABLE AND EFFICIENT PAYMENT METH16 ODOLOGIES FOR REHABILITATIVE SERVICES. 

17 Section 1905(a)(13) of the Social Security Act (42 

18 U.S.C. 1396d(a)(13)), as amended by section 103, is 

19 amended by inserting ‘‘(and which reimbursement for, in 

20 the case of rehabilitative services, may be made through 

21 the establishment of reasonable and efficient payment 

22 methodologies, including fee-for-service payments, case 

23 rates, daily rates, or other forms of capitated payment’’ 

24 after ‘‘status’’. 


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1 SEC. 103. INCLUSION OF ATTAINMENT AND RETENTION OF 

2 FUNCTIONAL STATUS IN REHABILITATIVE 

3 SERVICES. 

4 Section 1905(a)(13) of the Social Security Act (42 

5 U.S.C. 1396d(a)(13)) is amended by striking ‘‘and res6 toration of an individual to the best possible functional 

7 level’’ and inserting ‘‘, restoration of an individual to the 

8 best possible functional level, or attainment or retention 

9 of the individual’s best possible functional status’’. 

10 SEC. 104. CLARIFICATION OF COVERAGE OF EPSDT SERV11 ICES FOR CHILDREN RECEIVING INPATIENT 

12 PSYCHIATRIC HOSPITAL SERVICES. 

13 Section 1905(h)(1) of the Social Security Act (42 

14 U.S.C. 1396d(h)(1)) is amended— 

15 (1) in subparagraph (B), by striking ‘‘and’’ at 

16 the end; 

17 (2) in subparagraph (C), by adding ‘‘and’’ after 

18 the semicolon; and 

19 (3) by inserting after subparagraph (C), the fol20 lowing new subparagraph: 

21 ‘‘(D) services described in subsection (r) which 

22 are provided on an inpatient or outpatient basis to 

23 an individual receiving inpatient services described in 

24 subparagraph (A), (B), or (C).’’. 


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1 SEC. 105. THIRD PARTY LIABILITY CLARIFICATION RELAT2 ING TO DIAGNOSTIC, SCREENING, PREVEN3 TIVE, AND REHABILITATIVE SERVICES. 

4 Section 1903(c) of the Social Security Act (42 U.S.C. 

5 1396b(c)) is amended— 

6 (1) by inserting ‘‘(1)’’ after ‘‘(c)’’; and 

7 (2) by adding at the end the following new 

8 paragraph: 

9 ‘‘(2) Nothing in this title shall be construed as pro10 hibiting or restricting, or authorizing the Secretary to pro11 hibit or restrict, payment under subsection (a) for medical 

12 assistance for services provided under section 1905(a)(13) 

13 to eligible individuals furnished by qualified providers 

14 under non-medical programs, provided, however, a State 

15 or local agency administering such plan shall comply with 

16 section 1902(a)(25).’’. 

17 SEC. 106. EFFECTIVE DATE. 

18 The amendments made by this title shall take effect 

19 as if enacted on July 1, 2008. 


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1 TITLE II—CASE MANAGEMENT 

2 AND TARGETED CASE MAN3 AGEMENT PROTECTIONS 

4 SEC. 201. THIRD PARTY LIABILITY CLARIFICATION RELAT5 ING TO CASE MANAGEMENT AND TARGETED 

6 CASE MANAGEMENT. 

7 Section 1903(c) of the Social Security Act (42 U.S.C. 

8 1396b(c)), as amended by section 105, is amended by add9 ing at the end the following new paragraph: 

10 ‘‘(3) Nothing in this title shall be construed as pro11 hibiting or restricting, or authorizing the Secretary to pro12 hibit or restrict payment under subsection (a) for medical 

13 assistance for services provided under section 1915(g) to 

14 eligible individuals furnished by qualified providers under 

15 non-medical programs, provided, however, a State or local 

16 agency administering such plan shall comply with section 

17 1902(a)(25).’’. 

18 SEC. 202. REASONABLE AND EFFICIENT PAYMENT METH19 ODOLOGIES FOR CASE MANAGEMENT SERV20 ICES. 

21 Section 1915(g)(4) of the Social Security Act (42 

22 U.S.C. 1396n(g)(4)) is amended by adding at the end the 

23 following new subparagraph: 

24 ‘‘(C) Reimbursement for case management and tar25 geted case management services may be made through the 


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1 establishment of reasonable and efficient payment meth2 odologies including fee-for-service payments, case rates, 

3 daily rates, or other forms of capitated payment.’’. 

4 SEC. 203. PROTECTING HEALTH AND SAFETY. 

5 Section 1915(c)(4) of the Social Security Act (42 

6 U.S.C. 1396n(c)(4)) is amended by adding after the sec7 ond sentence the following new sentence: ‘‘For the purpose 

8 of developing and monitoring the implementation of the 

9 written plan of care required under paragraph (1), and 

10 to assure the health and welfare of individuals, the State 

11 may require case management services for each bene12 ficiary and may limit the case managers available with re13 spect to case management services for eligible individuals 

14 in order to ensure that the case managers for such individ15 uals are capable of ensuring that such individuals receive 

16 needed services.’’. 

17 SEC. 204. CODIFICATION OF OLMSTEAD STANDARD; PRO18 TECTING CHILDREN. 

19 Section 1915(g)(2)(A) of the Social Security Act (42 

20 U.S.C. 1396n(g)(2)(A)) is amended— 

21 (1) in clause (i), by striking ‘‘services which 

22 will’’ and all that follows through the period and in23 serting ‘‘services furnished to assist individuals, eli24 gible under the State plan who reside in a commu25 nity setting or are transitioning to a community setVerDate Nov 24 2008 02:30 Jun 10, 2009 Jkt 079200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S1217.IS S1217

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1 ting, in gaining access to needed medical, social, 

2 educational, and other services. Such services may 

3 be offered by staff of non-medical programs or those 

4 who contract with non-medical programs, so long as 

5 such individuals are qualified providers under the 

6 State plan under this title and the case management 

7 services are distinct from the direct services of the 

8 non-medical program.’’; 

9 (2) by redesignating clause (ii) as clause (iii); 

10 and 

11 (3) by inserting after clause (i) (as amended by 

12 paragraph (1)), the following new clause: 

13 ‘‘(ii) For purposes of providing case manage14 ment services, individuals (other than individuals 

15 who have attained age 22 but not attained age 65 

16 and are patients in an institution for mental dis17 eases or individuals who are inmates of public insti18 tutions) may be considered to be transitioning to a 

19 community setting for up to the last 180 days of an 

20 institutional stay.’’. 

21 SEC. 205. ASSURING APPROPRIATE CASE MANAGEMENT. 

22 Section 1915(g)(4) of the Social Security Act (42 

23 U.S.C. 1396n(g)(4)), as amended by section 202, is 

24 amended by adding at the end the following: 


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1 ‘‘(D) Nothing in this subsection shall be construed 

2 as prohibiting a State from providing case management 

3 or targeted case management services, as defined in sub4 paragraphs (A) and (B), respectively, of paragraph (2), 

5 through multiple case managers to any individual who 

6 qualifies for medical assistance under the State plan, or 

7 to specific classes of individuals, or to individuals who re8 side in specified areas, selected by the State pursuant to 

9 this subsection.’’. 

10 SEC. 206. EFFECTIVE DATE. 

11 The amendments made by this title shall take effect 

12 as if enacted on December 4, 2007. 

Æ 


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