I 

111TH CONGRESS 

1ST SESSION H. R. 3141 

To amend title XIX of the Social Security Act to provide for a DSH redistribution pool from unexpended Medicaid DSH allotments in order to 

increase Medicaid DSH allotments for low DSH States and to provide 

grants for health access networks serving the uninsured. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 9, 2009 

Mr. SULLIVAN (for himself, Mr. BOREN, Mr. LUCAS, and Mr. COLE) introduced the following bill; which was referred to the Committee on Energy 

and Commerce 

A BILL 

To amend title XIX of the Social Security Act to provide 

for a DSH redistribution pool from unexpended Medicaid 

DSH allotments in order to increase Medicaid DSH allotments for low DSH States and to provide grants for 

health access networks serving the uninsured. 

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 ‘‘Strengthening the 

5 Health Care Safety Net Act of 2009’’. 


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1 SEC. 2. APPLICATION OF UNEXPENDED MEDICAID DSH AL2 LOTMENTS FOR INCREASED ALLOTMENTS 

3 FOR LOW DSH STATES AND FOR HEALTH 

4 NETWORK ACCESS GRANTS. 

5 (a) ESTABLISHMENT OF DSH REDISTRIBUTION

6 POOL FROM UNEXPENDED MEDICAID DSH ALLOT7 MENTS.—Subsection (f) of section 1923 of the Social Se8 curity Act (42 U.S.C. 1396r–4) is amended— 

9 (1) by redesignating paragraph (7) as para10 graph (8); and 

11 (2) by inserting after paragraph (6) the fol12 lowing new paragraph: 

13 ‘‘(7) DSH REDISTRIBUTION POOL FROM POR14 TION OF UNEXPENDED DSH ALLOTMENTS TO FUND

15 INCREASE IN ALLOTMENTS FOR LOW DSH STATES

16 AND HEALTH NETWORK ACCESS GRANTS.— 

17 ‘‘(A) ESTABLISHMENT.—There is estab18 lished a DSH redistribution pool in the amount 

19 provided under this paragraph. Such amount 

20 shall be determined by the Secretary at the be21 ginning of each fiscal year and the Secretary 

22 may adjust such amount in subsequent fiscal 

23 years to take into account errors in estimates 

24 made for previous fiscal years. The amount in 

25 such pool shall be available for obligation and 

26 expenditure without fiscal year limitation. 


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1 ‘‘(B) ADDITION OF UNEXPENDED DSH AL2 LOTMENTS.—At the beginning of each fiscal 

3 year (beginning with fiscal year 2010), there 

4 shall be added to the DSH redistribution pool 

5 an amount equal to the amount by which— 

6 ‘‘(i) the total of the DSH allotments 

7 for all States for the third preceding fiscal 

8 year; exceeded 

9 ‘‘(ii) the total Federal financial par10 ticipation under this title attributable to 

11 such allotments for such fiscal year. 

12 ‘‘(C) REDUCTION FOR EXPENDITURES RE13 SULTING FROM INCREASED ALLOTMENTS FOR

14 LOW DSH STATES AND FOR HEALTH NETWORK

15 ACCESS GRANTS.—At the beginning of each fis16 cal year (beginning with fiscal year 2011), there 

17 shall be subtracted from the DSH redistribu18 tion pool an amount equal to the sum of— 

19 ‘‘(i) the aggregate increase in Federal 

20 financial participation under this title at21 tributable to the amendments made by sec22 tion 2(b) of the Strengthening the Health 

23 Care Safety Net Act of 2009 for the pre24 vious fiscal year; and 


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1 ‘‘(ii) the amount obligated on grants 

2 under subsection (k) for such previous fis3 cal year.’’. 

4 (b) INCREASE IN DSH ALLOTMENTS FOR LOW DSH 

5 STATES; QUALIFICATION OF LOW DSH STATES BASED

6 ON FISCAL YEAR 2005 DATA.—Subsection (f)(5) of such 

7 section is amended— 

8 (1) in subparagraph (B)— 

9 (A) by striking ‘‘and’’ at the end of clause 

10 (ii); 

11 (B) in clause (iii)— 

12 (i) by striking ‘‘2009’’ and inserting 

13 ‘‘2015’’; 

14 (ii) by inserting ‘‘, subject to subpara15 graph (D),’’ after ‘‘shall be’’; and 

16 (iii) by redesignating such clause as 

17 clause (iv); and 

18 (C) by inserting after clause (ii) the fol19 lowing new clause: 

20 ‘‘(iii) each succeeding fiscal year be21 fore fiscal year 2015 shall be, subject to 

22 subparagraph (D), the DSH allotment for 

23 the State for the previous fiscal year in24 creased by 16 percent; and’’; and 


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1 (2) by adding at the end the following new sub2 paragraphs: 

3 ‘‘(C) ADDITIONAL STATES COVERED FOR

4 FISCAL YEAR 2010 AND SUBSEQUENT YEARS.— 

5 In the case of a State not described in subpara6 graph (B) in which the total expenditures under 

7 the State plan (including Federal and State 

8 shares) for disproportionate share hospital ad9 justments under this section for fiscal year 

10 2005, as reported to the Administrator of the 

11 Centers for Medicare & Medicaid Services as of 

12 August 31, 2008, is greater than 0 but less 

13 than 3 percent of the State’s total amount of 

14 expenditures under the State plan for medical 

15 assistance during the fiscal year, the DSH al16 lotment for the State with respect to— 

17 ‘‘(i) fiscal year 2010 and any suc18 ceeding fiscal year before fiscal year 2015 

19 shall be, subject to subparagraph (D), the 

20 DSH allotment for the State for the pre21 vious fiscal year increased by 16 percent; 

22 and 

23 ‘‘(ii) any subsequent fiscal year shall 

24 be, subject to subparagraph (D), the DSH 

25 allotment for the State for the previous fisVerDate Nov 24 2008 05:16 Jul 10, 2009 Jkt 079200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H3141.IH H3141

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1 cal year subject to an increase for inflation 

2 as provided in paragraph (3)(A). 

3 ‘‘(D) LIMITATION ON INCREASES TO

4 AMOUNT AVAILABLE FROM DSH REDISTRIBU5 TION POOL.—If the Secretary estimates for a 

6 fiscal year (beginning with fiscal year 2010) 

7 that— 

8 ‘‘(i) the amount of additional expendi9 tures in the fiscal year resulting from the 

10 application of an increase in DSH allot11 ments under subparagraphs (B) and (C) 

12 beginning with fiscal year 2010 of 16 per13 cent (instead of the application of an in14 crease for inflation as provided in para15 graph (3)(A)), exceeds 

16 ‘‘(ii) the amount available for obliga17 tion from the DSH redistribution pool 

18 under paragraph (7) for the fiscal year, 

19 the Secretary shall reduce the increase in the 

20 DSH allotments otherwise provided under such 

21 subparagraphs for the fiscal year in a pro-rata 

22 manner so that the amount of additional ex23 penditures in the fiscal year resulting from the 

24 application of such subparagraphs is equal to 

25 the amount described in clause (ii) for the fiscal 


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1 year. A reduction in a DSH allotment for a 

2 State under this subparagraph shall not affect 

3 the computation of the DSH allotment for the 

4 State under subparagraph (B) or (C) for the 

5 subsequent fiscal year.’’. 

6 (c) DEMONSTRATION GRANTS TO HEALTH ACCESS

7 NETWORKS.—Such section is further amended by adding 

8 at the end the following new subsection: 

9 ‘‘(k) DEMONSTRATION GRANTS TO HEALTH ACCESS

10 NETWORKS.— 

11 ‘‘(1) IN GENERAL.—From the amount of funds 

12 made available under paragraph (6)(A) of this sub13 section from funds made available under subsection 

14 (d)(7) for a fiscal year, the Secretary shall award 

15 demonstration grants under this subsection to health 

16 access networks for such fiscal year for the purpose 

17 of improving access, quality, and continuity of care 

18 for uninsured individuals through better coordina19 tion of care by the network. 

20 ‘‘(2) HEALTH ACCESS NETWORK DEFINED.— 

21 ‘‘(A) IN GENERAL.—In this subsection, the 

22 term ‘health access network’ means an entity 

23 representing a collection of safety net providers, 

24 including hospitals, community health centers, 

25 public health departments, physicians, safety 


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1 net health plans, federally qualified health cen2 ters, or other recognized safety net providers, 

3 that— 

4 ‘‘(i) is organized for the purpose of re5 structuring and improving the access, qual6 ity, and continuity of care to the uninsured 

7 and underinsured; and 

8 ‘‘(ii) offers patients access to all levels 

9 of care, including primary, outpatient, spe10 cialty, certain ancillary services, and acute 

11 inpatient care, within a community or 

12 across a broad spectrum of providers 

13 across a service region or State. 

14 ‘‘(B) INCLUSION OF SECTION 330 NET15 WORKS AND PLANS.—Such term includes net16 works and plans that meet the requirements for 

17 funding under section 330(e)(1)(C) of the Pub18 lic Health Service Act (42 U.S.C. 

19 254b(e)(1)(C)). 

20 ‘‘(C) INCLUSION OF INTEGRATED HEALTH

21 CARE SYSTEMS.— 

22 ‘‘(i) IN GENERAL.—Such term also in23 cludes an integrated health care system 

24 (including a pediatric system). 


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1 ‘‘(ii) DEFINITION.—For purposes of 

2 this subparagraph, the term ‘integrated 

3 health care system (including a pediatric 

4 system)’ means a health care provider 

5 that— 

6 ‘‘(I) is organized to provide care 

7 in a coordinated fashion; and 

8 ‘‘(II) assures access to a full 

9 range of primary, specialty, and hos10 pital care, to uninsured and under-in11 sured individuals, as appropriate. 

12 ‘‘(3) APPLICATION AND PLAN REQUIREMENT.— 

13 ‘‘(A) IN GENERAL.—In order to be eligible 

14 for a grant under this subsection, a health ac15 cess network shall— 

16 ‘‘(i) submit an application, in such 

17 form and manner as the Secretary shall 

18 specify; 

19 ‘‘(ii) submit with such application a 

20 plan that meets the requirements of sub21 paragraph (B); 

22 ‘‘(iii) identify in such plan measurable 

23 performance targets for at least 3 of the 

24 goals described in subparagraph (B); and 


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1 ‘‘(iv) agree that a portion of the pay2 ment of grant funds for patient care serv3 ices after the first year for which such pay4 ment is made shall be contingent upon the 

5 health access network demonstrating suc6 cess in achieving such targets. 

7 ‘‘(B) PLAN REQUIREMENTS.—A health ac8 cess network that desires a grant under this 

9 subsection shall submit a plan to the Secretary 

10 that details how the network intends through 

11 the grant— 

12 ‘‘(i) to manage costs associated with 

13 the provision of health care services to un14 insured and underinsured individuals 

15 served by the network; 

16 ‘‘(ii) to improve access to, and the 

17 availability of, health care services provided 

18 to uninsured and underinsured individuals 

19 served by the network; 

20 ‘‘(iii) to enhance the quality and co21 ordination of health care services provided 

22 to uninsured and underinsured individuals 

23 served by the network; 


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1 ‘‘(iv) to improve the health status of 

2 uninsured and underinsured individuals 

3 served by the network; and 

4 ‘‘(v) to reduce health disparities in the 

5 population of uninsured and underinsured 

6 individuals served by the network. 

7 Nothing in this paragraph shall be construed as 

8 requiring a health access network operating in 

9 a State to operate on a statewide basis or oth10 erwise to serve all uninsured and underinsured 

11 individuals in area served. 

12 ‘‘(C) AUTHORITY TO LIMIT NUMBER OF

13 GRANTS.—In awarding grants under this sub14 section, the Secretary may limit the grants in 

15 a manner so that each grantee is able to pro16 vide patient care services to the number of un17 insured individuals specified by each network in 

18 its grant application. 

19 ‘‘(4) USE OF FUNDS.— 

20 ‘‘(A) IN GENERAL.—A health access net21 work that receives funds under a grant under 

22 this subsection shall expend an amount equal to 

23 at least 90 percent of such funds for the provi24 sion of (or payment for) direct patient care 

25 services. 


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1 ‘‘(B) RULE OF CONSTRUCTION REGARDING

2 DIRECT PATIENT CARE SERVICES.—For pur3 poses of subparagraph (A), the term ‘direct pa4 tient care services’ means, with respect to a 

5 health access network, services, such as spe6 cialty medical care and diagnostic services, that 

7 are not available or are insufficiently available 

8 through the network’s providers other than 

9 under a grant under this subsection. 

10 ‘‘(C) PREFERENCE FOR SERVICES

11 THROUGH SAFETY NET PROVIDERS.—In pur12 chasing direct patient care services for unin13 sured and underinsured individuals under a 

14 grant under this subsection, health access net15 works shall, to the maximum extent feasible, 

16 endeavor to purchase such services from safety 

17 net providers. 

18 ‘‘(5) SUPPLEMENT, NOT SUPPLANT.—Funds 

19 paid to a health access network under a grant under 

20 this subsection shall supplement and not supplant, 

21 other Federal or State payments that are made to 

22 the network to support the provision of health care 

23 services to low-income or uninsured patients. 

24 ‘‘(6) FUNDING.— 


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1 ‘‘(A) AVAILABILITY OF FUNDS FROM DSH

2 REDISTRIBUTION POOL.—To carry out this sub3 section there is hereby made available for each 

4 fiscal year (beginning with fiscal year 2010 and 

5 ending with fiscal year 2014) and appropriated 

6 from the DSH redistribution pool established 

7 under subsection (d)(7), an amount equal to— 

8 ‘‘(i) the amount available for obliga9 tion from such pool in such fiscal year, re10 duced by 

11 ‘‘(ii) the Secretary’s estimate of the 

12 aggregate increase in Federal financial 

13 participation under this title for the fiscal 

14 year that will be attributable to the amend15 ments made by section 2(b) of the 

16 Strengthening the Health Care Safety Net 

17 Act of 2009. 

18 ‘‘(B) TREATMENT OF GRANT FUNDS.— 

19 Payments to a health access network under a 

20 grant under this subsection shall not be treated 

21 as a disproportionate share hospital payment 

22 adjustments under this section and shall not be 

23 counted against the DSH allotment for any 

24 State. 


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1 ‘‘(C) NO STATE MATCHING REQUIRED.— 

2 Nothing in this subsection shall be construed as 

3 requiring a State to provide for any State 

4 matching funds to receive funds under this sub5 section. 

6 ‘‘(D) AVAILABILITY.—The amount of any 

7 grant to a health access network under this 

8 subsection shall remain available for expendi9 ture under the grant through the end of the 

10 third fiscal year after the fiscal year in which 

11 the grant is made.’’. 

12 (d) CONFORMING DATE OF APPLICATION OF DSH 

13 HOSPITAL REQUIREMENT TO AVAILABILITY OF FUNDING

14 FOR LOW DSH STATES.—Subsection (d)(2)(A)(ii) of such 

15 section is amended by inserting before the period at the 

16 end the following: ‘‘(or, in the case of a low DSH State 

17 described in subparagraph (B) or (C) of subsection (f)(5), 

18 the date of the enactment of the Strengthening the Safety 

19 Net Act of 2009)’’. 

20 (e) REPORTING USING UNIFIED REPORTING DOCU21 MENT.—Not later than 60 days after the date of the en22 actment of this Act, the Secretary of Health and Human 

23 Services shall develop a unified reporting document for all 

24 disproportionate share hospital (DSH) allocations and ex25 penditures under section 1923 of the Social Security Act. 


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1 Beginning in fiscal year 2010 each State receiving a DSH 

2 allocation under such section shall be required by the Sec3 retary to report all expenditures against the allocation 

4 using such unified reporting document. This requirement 

5 shall apply to States regardless of whether the DSH ex6 penditures occur through a waiver. 

7 (f) EFFECTIVE DATE.—The amendments made by 

8 this section shall apply beginning with fiscal year 2010. 

Æ 


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