II 

108TH CONGRESS 

2D SESSION S. 2222

To amend titles XIX and XXI of the Social Security Act to clarify and 

ensure that the authority granted to the Secretary of Health and Human 

Services under section 1115 of that Act is used solely to promote the 

objectives of the medicaid and State children’s health insurance programs, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

MARCH 22, 2004

Mr. BAUCUS (for himself and Mr. ROCKEFELLER) introduced the following 

bill; which was read twice and referred to the Committee on Finance 

A BILL

To amend titles XIX and XXI of the Social Security Act 

to clarify and ensure that the authority granted to the 

Secretary of Health and Human Services under section 

1115 of that Act is used solely to promote the objectives 

of the medicaid and State children’s health insurance 

programs, 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; TABLE OF CONTENTS. 

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

5 ‘‘Medicaid and CHIP Safety Net Preservation Act of 

6 2004’’. 
2

•S 2222 IS 

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

2 this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Findings; purposes; rule of construction.

Sec. 3. Clarification that section 1115 authority does not permit a cap on Federal financial participation.

Sec. 4. Clarification that section 1115 authority does not permit elimination of, 

or modification limiting, individual entitlement. 

Sec. 5. Clarification that section 1115 authority does not permit elimination or 

modification of requirements relating to EPSDT services.

Sec. 6. Clarification that section 1115 authority does not permit elimination or 

modification of requirements relating to certain safety-net services.

Sec. 7. Prohibition on use of CHIP funds for health benefits coverage for childless adults.

Sec. 8. Improvement of the process for the development and approval of medicaid and CHIP demonstration projects.

Sec. 9. Effective date.

3 SEC. 2. FINDINGS; PURPOSES; RULE OF CONSTRUCTION. 

4 (a) FINDINGS.—Congress makes the following find5 ings: 

6 (1) Certain requirements of titles XIX and XXI 

7 of the Social Security Act (42 U.S.C. 1396 et seq., 

8 1397aa et seq.) are central to the overall objectives 

9 of the medicaid and State children’s health insur10 ance programs and are not properly subject to waiv11 er, modification, or disregard under the authority of 

12 section 1115 of the Social Security Act (42 U.S.C. 

13 1315). 

14 (2) Some of the requirements of titles XIX and 

15 XXI of the Social Security Act that promote the 

16 overall objectives of the medicaid and State chil17 dren’s health insurance programs have been waived, 

18 modified, or otherwise disregarded by the Secretary 
3

•S 2222 IS 

1 of Health and Human Services under such section 

2 1115, despite the explicit requirement in that section 

3 that certain requirements of the medicaid and State 

4 children’s health insurance programs only may be 

5 waived, modified, or disregarded for the purpose of 

6 approving an experimental, pilot, or demonstration 

7 project if the waiver, modification, or disregard ‘‘is 

8 likely to assist in promoting the objectives’’ of those 

9 programs. 

10 (b) PURPOSES.—The purposes of this Act are the fol11 lowing: 

12 (1) To clarify that certain requirements of titles 

13 XIX and XXI of the Social Security Act (42 U.S.C. 

14 1396 et seq., 1397aa et seq.), which are among 

15 those critical to achieving the objectives of the med16 icaid and State children’s health insurance pro17 grams, may not be waived, modified, or otherwise 

18 disregarded by the Secretary of Health and Human 

19 Services under the authority of section 1115 of the 

20 Social Security Act (42 U.S.C. 1315). 

21 (2) To ensure that the authority granted to the 

22 Secretary of Health and Human Services under sec23 tion 1115 of the Social Security Act (42 U.S.C. 

24 1315) with respect to the medicaid and State chil25 dren’s health insurance programs for the purpose of 
4

•S 2222 IS 

1 approving experimental, pilot, or demonstration 

2 projects is not used inappropriately. 

3 (c) RULE OF CONSTRUCTION.—Nothing in this Act 

4 or the amendments made by this Act shall be construed 

5 to— 

6 (1) authorize the waiver, modification, or other 

7 disregard of any provision of title XIX or XXI of the 

8 Social Security Act (42 U.S.C. 1396 et seq., 1397aa 

9 et seq.); or 

10 (2) imply congressional approval of any dem11 onstration project affecting the medicaid program 

12 under title XIX of the Social Security Act or the 

13 State children’s health insurance program under 

14 title XXI of such Act that has been approved by the 

15 Secretary of Health and Human Services as of the 

16 date of enactment of this Act. 

17 SEC. 3. CLARIFICATION THAT SECTION 1115 AUTHORITY 

18 DOES NOT PERMIT A CAP ON FEDERAL FI19 NANCIAL PARTICIPATION. 

20 Title XIX of the Social Security Act is amended by 

21 inserting after section 1925 the following: 

22 ‘‘CLARIFICATIONS OF AUTHORITY UNDER SECTION 1115

23 ‘‘SEC. 1926. (a) CLARIFICATION THAT SECTION

24 1115 AUTHORITY DOES NOT PERMIT A CAP ON FEDERAL

25 FINANCIAL PARTICIPATION.—The Secretary may not im26 pose or approve under the authority of section 1115 a cap, 
5

•S 2222 IS 

1 limitation, or other restriction on payment under section 

2 1903(a) to a State for amounts expended as medical as3 sistance in accordance with the requirements of this 

4 title.’’. 

5 SEC. 4. CLARIFICATION THAT SECTION 1115 AUTHORITY 

6 DOES NOT PERMIT ELIMINATION OF, OR 

7 MODIFICATION LIMITING, INDIVIDUAL ENTI8 TLEMENT. 

9 Section 1926 of the Social Security Act, as added by 

10 section 3, is amended by adding at the end the following: 

11 ‘‘(b) CLARIFICATION THAT SECTION 1115 AUTHOR12 ITY DOES NOT PERMIT ELIMINATION OF, OR MODIFICA13 TION LIMITING, INDIVIDUAL ENTITLEMENT.—The Sec14 retary may not approve or impose under the authority of 

15 section 1115 an elimination of, or modification limiting, 

16 the entitlement (established under section 1902(a), 

17 1905(a), or otherwise) of an individual to receive any med18 ical assistance for which Federal financial participation is 

19 claimed under this title.’’. 
6

•S 2222 IS 

1 SEC. 5. CLARIFICATION THAT SECTION 1115 AUTHORITY 

2 DOES NOT PERMIT ELIMINATION OR MODI3 FICATION OF REQUIREMENTS RELATING TO 

4 EPSDT SERVICES. 

5 Section 1926 of the Social Security Act, as added by 

6 section 3 and amended by section 4, is amended by adding 

7 at the end the following:

8 ‘‘(c) CLARIFICATION THAT SECTION 1115 AUTHOR9 ITY DOES NOT PERMIT ELIMINATION OR MODIFICATION

10 OF REQUIREMENTS RELATING TO EPSDT SERVICES.—

11 The Secretary may not impose or approve under the au12 thority of section 1115 an elimination or modification of 

13 the amount, duration, or scope of the services described 

14 in section 1905(a)(4)(B) (relating to early and periodic 

15 screening, diagnostic, and treatment services (as defined 

16 in section 1905(r))) or of the requirements of subpara17 graphs (A) through (C) of section 1902(a)(43).’’. 

18 SEC. 6. CLARIFICATION THAT SECTION 1115 AUTHORITY 

19 DOES NOT PERMIT ELIMINATION OR MODI20 FICATION OF REQUIREMENTS RELATING TO 

21 CERTAIN SAFETY-NET SERVICES. 

22 Section 1926 of the Social Security Act, as added by 

23 section 3 and amended by sections 4 and 5, is amended 

24 by adding at the end the following: 

25 ‘‘(d) CLARIFICATION THAT SECTION 1115 AUTHOR26 ITY DOES NOT PERMIT ELIMINATION OR MODIFICATION
7

•S 2222 IS 

1 OF REQUIREMENTS RELATING TO CERTAIN SAFETY-NET

2 SERVICES.—The Secretary may not impose or approve 

3 under the authority of section 1115 an elimination or 

4 modification of the amount, duration, or scope of the serv5 ices described in subparagraphs (B) and (C) of section 

6 1905(a)(2) (relating to services provided by a rural health 

7 clinic (as defined in section 1905(l)(1)) and services pro8 vided by a federally-qualified health center (as defined in 

9 section 1905(l)(2))) or of the requirements of section 

10 1902(bb) (relating to payment for such services).’’. 

11 SEC. 7. PROHIBITION ON USE OF CHIP FUNDS FOR HEALTH 

12 BENEFITS COVERAGE FOR CHILDLESS 

13 ADULTS. 

14 (a) IN GENERAL.—Section 2107 of the Social Secu15 rity Act (42 U.S.C. 1397gg) is amended by adding at the 

16 end the following:’’ 

17 ‘‘(f) LIMITATION OF WAIVER AUTHORITY.—Notwith18 standing subsection (e)(2)(A) and section 1115(a), on and 

19 after the date of enactment of this subsection, the Sec20 retary may not approve a waiver, experimental, pilot, or 

21 demonstration project, or an amendment to such a project, 

22 that would allow funds made available under this title to 

23 be used to provide child health assistance or other health 

24 benefits coverage to a nonpregnant childless adult. For 

25 purposes of the preceding sentence, a caretaker relative 
8

•S 2222 IS 

1 (as such term is defined for purposes of carrying out sec2 tion 1931) shall not be considered a childless adult.’’. 

3 (b) CONFORMING AMENDMENTS.—Section 

4 2105(c)(1) of such Act (42 U.S.C. 1397ee(c)(1)) is 

5 amended—

6 (1) by inserting ‘‘and may not include coverage 

7 of a nonpregnant childless adult’’ after ‘‘section 

8 2101)’’; and 

9 (2) by adding at the end the following: ‘‘For 

10 purposes of the preceding sentence, a caretaker rel11 ative (as such term is defined for purposes of car12 rying out section 1931) shall not be considered a 

13 childless adult.’’. 

14 SEC. 8. IMPROVEMENT OF THE PROCESS FOR THE DEVEL15 OPMENT AND APPROVAL OF MEDICAID AND 

16 CHIP DEMONSTRATION PROJECTS. 

17 Section 1115 of the Social Security Act (42 U.S.C. 

18 1315) is amended by inserting after subsection (c) the fol19 lowing: 

20 ‘‘(d) In the case of any experimental, pilot, or dem21 onstration project under subsection (a) to assist in pro22 moting the objectives of title XIX or XXI in a State that 

23 would result in a substantive change in eligibility, enroll24 ment, benefits, financing, or cost-sharing (to the extent 

25 permitted under section 1916(f)) with respect to a State 
9

•S 2222 IS 

1 program under title XIX or XXI (in this subsection re2 ferred to as a ‘demonstration project’) the following shall 

3 apply: 

4 ‘‘(1) The Secretary may not approve a proposal 

5 for a demonstration project, or for an amendment of 

6 a demonstration project, submitted by a State on or 

7 after the date of enactment of this subsection, unless 

8 the State requesting approval certifies that the State 

9 provided reasonable public notice and a reasonable 

10 opportunity for receipt and consideration of public 

11 comment on the proposal prior to submission of the 

12 proposal to the Secretary. Such notice shall in13 clude—

14 ‘‘(A) the proposal; 

15 ‘‘(B) the methodologies underlying the pro16 posal; 

17 ‘‘(C) the justifications for the proposal; 

18 ‘‘(D) the State’s projections regarding the 

19 likely effect and impact of the proposal on indi20 viduals eligible for assistance and providers or 

21 suppliers of items or services under title XIX or 

22 XXI (including under any demonstration 

23 project conducted in conjunction with either of 

24 those titles); and 
10

•S 2222 IS 

1 ‘‘(E) the State’s assumptions on which the 

2 projections described in subparagraph (D) are 

3 based. 

4 ‘‘(2) With respect to any proposal for a dem5 onstration project, or for an amendment or exten6 sion of a demonstration project, which has not been

7 approved or disapproved by the Secretary as of the 

8 date of enactment of this subsection, the Secretary 

9 shall—

10 ‘‘(A) provide public notice in the Federal 

11 Register and on the Internet website of the 

12 Centers for Medicare & Medicaid Services of 

13 the proposal, any revisions of the proposal, and 

14 any conditions for the financing or approval of 

15 the proposal; 

16 ‘‘(B) provide adequate opportunity for 

17 public comment on the proposal, any revisions 

18 of the proposal, and any such conditions; 

19 ‘‘(C) approve such proposal, any revisions 

20 of the proposal, and any such conditions only if, 

21 after consideration of the public comments re22 ceived, the Secretary determines that the pro23 posal, any revisions of the proposal, and any 

24 such conditions are likely to assist in promoting 
11

•S 2222 IS 

1 the objectives of title XIX or XXI and identifies 

2 in writing the basis for such determination; and 

3 ‘‘(D) publish on such website all docu4 mentation relating to the proposal (including 

5 the written determination required under sub6 paragraph (C)), any revisions of the proposal, 

7 and any such conditions, including if the pro8 posal, any revisions of the proposal, and any 

9 such conditions are approved—

10 ‘‘(i) the final terms and conditions for 

11 the demonstration project; and 

12 ‘‘(ii) a list identifying each provision 

13 of title XIX or XXI, and each regulation 

14 relating to either such title, with which 

15 compliance is waived, modified, or other16 wise disregarded or for which costs that 

17 would otherwise not be permitted under 

18 such title will be allowed.’’. 

19 SEC. 9. EFFECTIVE DATE. 

20 (a) IN GENERAL.—Except as provided in subsection 

21 (b), the amendments made by sections 3 through 6 shall 

22 apply to the approval on or after the date of enactment 

23 of this Act of—
12

•S 2222 IS 

1 (1) a waiver, experimental, pilot, or demonstra2 tion project under section 1115 of the Social Secu3 rity Act (42 U.S.C. 1315); and 

4 (2) an amendment or extension of such a 

5 project. 

6 (b) EXCEPTION.—The amendment made by section 

7 5 shall not apply with respect to any extension of approval 

8 of a waiver, experimental, pilot, or demonstration project 

9 with respect to title XIX of the Social Security Act that 

10 was first approved before 1994 and that provides a com11 prehensive and preventive child health program under 

12 such project that includes screening, diagnosis, and treat13 ment of children who have not attained age 21.

Æ