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SEC. 1004. REFUNDABLE CREDIT FOR COST-SHARING EX-
PENSES UNDER MEDIKIDS PROGRAM.
(a) IN GENERAL.—Subpart C of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of
1986 (relating to refundable credits) is amended by redes-
ignating section 35 as section 36 and by inserting after
section 34 the following new section:
‘‘SEC. 35. COST-SHARING EXPENSES UNDER MEDIKIDS PRO-
GRAM.
‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in-
dividual who has a MediKid (as defined in section 59B)
at any time during the taxable year, there shall be allowed
as a credit against the tax imposed by this subtitle an
amount equal to 50 percent of the amount paid by the
taxpayer during the taxable year as cost-sharing under
section 2202(b)(4) of the Social Security Act.
‘‘(b) LIMITATION BASED ON ADJUSTED GROSS IN-
COME.—The amount of the credit which would (but for
this subsection) be allowed under this section for the tax-
able year shall be reduced (but not below zero) by an
amount which bears the same ratio to such amount of
credit as the excess of the taxpayer’s adjusted gross in-
come for such taxable year over the exemption amount (as
defined in section 59B(d)) bears to such exemption
amount.’’.
(b) TECHNICAL AMENDMENTS.—
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(1) Paragraph (2) of section 1324(b) of title
31, United States Code, is amended by inserting be-
fore the period ‘‘or from section 35 of such Code’’.
(2) The table of sections for subpart C of part
IV of subchapter A of chapter 1 of such Code is
amended by striking the last item and inserting the
following new items:
‘‘Sec. 35. Cost-sharing expenses under MediKids program.
‘‘Sec. 36. Overpayments of tax.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
December 31, 2002.
SEC. 1005. REPORT ON LONG-TERM REVENUES.
Within 1 year after the date of enactment of this
title, the Secretary of the Treasury shall propose a gradual
schedule of progressive tax changes to fund the program
under title XXII of the Social Security Act, as the number
of enrollees grows in the out-years.
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Subtitle B—Children’s Health In-
surance 
Eligibility 
Expansion
and Enrollment Improvements
CHAPTER 1—ELIGIBILITY EXPANSIONS
Subchapter A—Medicaid and SCHIP
SEC. 1101. EXPANSION OF CHILDREN’S ELIGIBILITY FOR
MEDICAID AND SCHIP.
(a) EXPANSION
OF INCOME ELIGIBILITY UNDER
SCHIP.—Section 2110(c)(4) of the Social Security Act
(42 U.S.C. 42 U.S.C. 1397jj(c)(4)) is amended by striking
‘‘200’’ and inserting ‘‘300’’.
(b) MANDATORY BUY-IN COVERAGE.—
(1) MEDICAID.—Section 1902(a)(10)(A)(i) of
the 
Social 
Security 
Act 
(42 
U.S.C.
1396a(a)(10)(A)(i)) is amended—
(A) by striking ‘‘or’’ at the end of sub-
clause (VI);
(B) by striking the semicolon at the end of
subclause (VII) and insert ‘‘, or’’; and
(C) by adding at the end the following:
‘‘(VIII) who are children in fami-
lies whose income exceeds 300 percent
of the income official poverty line (as
defined by the Office of Management
and Budget, and revised annually in
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accordance with section 673(2) of the
Omnibus Budget Reconciliation Act of
1981) applicable to a family of the
size involved subject, notwithstanding
section 1916, to payment of premiums
or other cost-sharing charges (set on
a sliding scale based on income) that
the State may determine;’’.
(2) SCHIP.—Section 2107(e)(1) of such Act
(42 U.S.C. 1397gg(e)(1)) is amended by adding at
the end the following new subparagraph:
‘‘(E) Section 1902(a)(10)(A)(i)(VIII) (re-
lating to buy-in coverage for children whose
family income exceeds 300 percent of the pov-
erty line).’’.
(c) EFFECTIVE DATE.—The amendments made by
this section apply to medical assistance and child health
assistance provided on or after October 1, 2001.
SEC. 1102. OPTIONAL COVERAGE OF LEGAL IMMIGRANTS
UNDER THE MEDICAID PROGRAM AND TITLE
XXI.
(a) MEDICAID PROGRAM.—Section 1903(v) of the
Social Security Act (42 U.S.C. 1396b(v)) is amended—
(1) in paragraph (1), by striking ‘‘paragraph
(2)’’ and inserting ‘‘paragraphs (2) and (4)’’; and
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(2) by adding at the end the following:
‘‘(4)(A) A State may elect (in a plan amendment
under this title) to provide medical assistance under this
title for aliens who are lawfully residing in the United
States (including battered aliens described in section
431(c) of the Personal Responsibility and Work Oppor-
tunity Reconciliation Act of 1996) and who are otherwise
eligible for such assistance, within any of the following eli-
gibility categories:
‘‘(i) PREGNANT WOMEN.—Women during preg-
nancy (and during the 60-day period beginning on
the last day of the pregnancy).
‘‘(ii) CHILDREN.—Children (as defined under
such plan), including optional targeted low-income
children described in section 1905(u)(2)(B).
‘‘(B)(i) In the case of a State that has elected to pro-
vide medical assistance to a category of aliens under sub-
paragraph (A), no debt shall accrue under an affidavit of
support against any sponsor of such an alien on the basis
of provision of assistance to such category and the cost
of such assistance shall not be considered as an unreim-
bursed cost.
‘‘(ii) The provisions of sections 401(a), 402(b), 403,
and 421 of the Personal Responsibility and Work Oppor-
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tunity Reconciliation Act of 1996 shall not apply to a
State that makes an election under subparagraph (A).’’.
(b) TITLE XXI.—Section 2107(e)(1) of the Social
Security Act (42 U.S.C. 1397gg(e)(1)), as amended by
section 803 of the Medicare, Medicaid, and SCHIP Bene-
fits Improvement and Protection Act of 2000 (as enacted
into law by section 1(a)(6) of Public Law 106–554), is
amended by adding at the end the following:
‘‘(E) Section 1903(v)(4) (relating to op-
tional coverage of permanent resident alien chil-
dren), but only if the State has elected to apply
such section to that category of children under
title XIX.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section take effect on October 1, 2001, and apply to
medical assistance and child health assistance furnished
on or after such date.
Subchapter B—Family Opportunity Act
SEC. 1111. SHORT TITLE; AMENDMENTS TO SOCIAL SECU-
RITY ACT.
(a) SHORT TITLE.—This subchapter may be cited as
the ‘‘Family Opportunity Act of 2001’’ or the ‘‘Dylan Lee
James Act’’.
(b) AMENDMENTS TO SOCIAL SECURITY ACT.—Ex-
cept as otherwise specifically provided, whenever in this
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Act an amendment is expressed in terms of an amendment
to or repeal of a section or other provision, the reference
shall be considered to be made to that section or other
provision of the Social Security Act.
SEC. 1112. OPPORTUNITY FOR FAMILIES OF DISABLED
CHILDREN TO PURCHASE MEDICAID COV-
ERAGE FOR SUCH CHILDREN.
(a) STATE OPTION TO ALLOW FAMILIES OF DIS-
ABLED CHILDREN TO PURCHASE MEDICAID COVERAGE
FOR SUCH CHILDREN.—
(1) IN
GENERAL.—Section 1902 (42 U.S.C.
1396a), as amended by section 2(a) of the Breast
and Cervical Cancer Prevention and Treatment Act
of 2000 (Public Law 106–354; 114 Stat. 1381) and
section 702(b) of the Medicare, Medicaid, and
SCHIP Benefits Improvement and Protection Act of
2000 (as enacted into law by section 1(a)(6) of Pub-
lic Law 106–554), is amended—
(A) in subsection (a)(10)(A)(ii)—
(i) by striking ‘‘or’’ at the end of sub-
clause (XVII);
(ii) by adding ‘‘or’’ at the end of sub-
clause (XVIII); and
(iii) by adding at the end the fol-
lowing new subclause:
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‘‘(XIX) who are disabled children
described in subsection (cc)(1);’’; and
(B) by adding at the end the following new
subsection:
‘‘(cc)(1) Individuals described in this paragraph are
individuals—
‘‘(A) who have not attained 18 years of age;
‘‘(B) who would be considered disabled under
section 1614(a)(3)(C) (determined without regard to
the reference to age in that section) but for having
earnings or deemed income or resources (as deter-
mined under title XVI for children) that exceed the
requirements for receipt of supplemental security in-
come benefits; and
‘‘(C) whose family income does not exceed such
income level as the State establishes and does not
exceed—
‘‘(i) 300 percent of the income official pov-
erty line (as defined by the Office of Manage-
ment and Budget, and revised annually in ac-
cordance with section 673(2) of the Omnibus
Budget Reconciliation Act of 1981) applicable
to a family of the size involved; or
‘‘(ii) such higher percent of such poverty
line as a State may establish, except that no
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Federal financial participation shall be provided
under section 1903(a) for any medical assist-
ance provided to an individual who would not be
described in this subsection but for this
clause.’’.
(2) INTERACTION WITH EMPLOYER-SPONSORED
FAMILY
COVERAGE.—Section 1902(cc) (42 U.S.C.
1396a(cc)), as added by paragraph (1), is amended
by adding at the end the following new paragraph:
‘‘(2)(A) If an employer of a parent of an individual
described in paragraph (1) offers family coverage under
a group health plan (as defined in section 2791(a) of the
Public Health Service Act), the State may—
‘‘(i) require such parent to apply for, enroll in,
and pay premiums for, such coverage as a condition
of such parent’s child being or remaining eligible for
medical 
assistance 
under 
subsection
(a)(10)(A)(ii)(XIX) if the parent is determined eligi-
ble for such coverage and the employer contributes
at least 50 percent of the total cost of annual pre-
miums for such coverage; and
‘‘(ii) if such coverage is obtained—
‘‘(I) subject to paragraph (2) of section
1916(h), reduce the premium imposed by the
State under that section (if any) in an amount
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that reasonably reflects the premium contribu-
tion made by the parent for private coverage on
behalf of a child with a disability; and
‘‘(II) treat such coverage as a third party
liability under subsection (a)(25).
‘‘(B) In the case of a parent to which subparagraph
(A) applies, if the family income of such parent does not
exceed 300 percent of the income official poverty line (re-
ferred to in paragraph (1)(C)(i)), a State may provide for
payment of any portion of the annual premium for such
family coverage that the parent is required to pay. Any
payments made by the State under this subparagraph
shall be considered, for purposes of section 1903(a), to
be payments for medical assistance.’’.
(b) STATE OPTION TO IMPOSE INCOME-RELATED
PREMIUMS.—Section 
1916 
(42 
U.S.C. 
1396o) 
is
amended—
(1) in subsection (a), by striking ‘‘subsection
(g)’’ and inserting ‘‘subsections (g) and (h)’’; and
(2) by adding at the end the following new sub-
section:
‘‘(h)(1) With respect to disabled children provided
medical assistance under section 1902(a)(10)(A)(ii)(XIX),
subject to paragraph (2), a State may (in a uniform man-
ner for such children) require the families of such children
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to pay monthly premiums set on a sliding scale based on
family income.
‘‘(2) A premium requirement imposed under para-
graph (1) may only apply to the extent that—
‘‘(A) the aggregate amount of such premium
and any premium that the parent is required to pay
for family coverage under section 1902(cc)(2)(A)(i)
does not exceed 5 percent of the family’s income;
and
‘‘(B) the requirement is imposed consistent with
section 1902(cc)(2)(A)(ii)(I).
‘‘(3) A State shall not require prepayment of a pre-
mium imposed pursuant to paragraph (1) and shall not
terminate 
eligibility 
of 
a 
child 
under 
section
1902(a)(10)(A)(ii)(XIX) for medical assistance under this
title on the basis of failure to pay any such premium until
such failure continues for a period of not less than 60 days
from the date on which the premium became past due.
The State may waive payment of any such premium in
any case where the State determines that requiring such
payment would create an undue hardship.’’.
(c) CONFORMING AMENDMENT.—Section 1903(f)(4)
(42 U.S.C. 1396b(f)(4)), as amended by section 710(a)
of the Medicare, Medicaid, and SCHIP Benefits Improve-
ment and Protection Act of 2000 (as enacted into law by
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section 1(a)(6) of Public Law 106–554), is amended in
the matter preceding subparagraph (A) by inserting
‘‘1902(a)(10)(A)(ii)(XIX),’’ 
after 
‘‘1902(a)(10)(A)
(ii)(XVIII),’’.
(d) TECHNICAL AMENDMENTS.—
(1) Section 1902 (42 U.S.C. 1396a), as amend-
ed by section 702(b) of the Medicare, Medicaid, and
SCHIP Benefits Improvement and Protection Act of
2000 (as enacted into law by section 1(a)(6) of Pub-
lic Law 106–554), is amended by redesignating the
subsection (aa) added by such section as subsection
(bb).
(2) 
Section 
1902(a)(15) 
(42 
U.S.C.
1396a(a)(15)), as added by section 702(a)(2) of the
Medicare, Medicaid, and SCHIP Benefits Improve-
ment and Protection Act of 2000 (as so enacted into
law), is amended by striking ‘‘subsection (aa)’’ and
inserting ‘‘subsection (bb)’’.
(3) Section 1915(b) (42 U.S.C. 1396n(b)), as
amended by section 702(c)(2) of the Medicare, Med-
icaid, and SCHIP Benefits Improvement and Pro-
tection Act of 2000 (as so enacted into law), is
amended by striking ‘‘1902(aa)’’ and inserting
‘‘1902(bb)’’.
(e) EFFECTIVE DATE.—
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(1) IN GENERAL.—The amendments made by
subsections (a), (b), and (c) shall apply to medical
assistance for items and services furnished on or
after January 1, 2002.
(2) TECHNICAL
AMENDMENTS.—The amend-
ments made by subsection (d) shall take effect as if
included in the enactment of section 702 of the
Medicare, Medicaid, and SCHIP Benefits Improve-
ment and Protection Act of 2000 (as enacted into
law by section 1(a)(6) of Public Law 106–554).
SEC. 1113. TREATMENT OF INPATIENT PSYCHIATRIC HOS-
PITAL SERVICES FOR INDIVIDUALS UNDER
AGE 21 IN HOME OR COMMUNITY-BASED
SERVICES WAIVERS.
(a) IN
GENERAL.—Section 1915(c) (42 U.S.C.
1396n(c)) is amended—
(1) in paragraph (1)—
(A) in the first sentence, by inserting ‘‘, or
inpatient psychiatric hospital services for indi-
viduals under age 21,’’ after ‘‘intermediate care
facility for the mentally retarded’’; and
(B) in the second sentence, by inserting ‘‘,
or inpatient psychiatric hospital services for in-
dividuals under age 21’’ before the period;
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(2) in paragraph (2)(B), by striking ‘‘or serv-
ices in an intermediate care facility for the mentally
retarded’’ each place it appears and inserting ‘‘,
services in an intermediate care facility for the men-
tally retarded, or inpatient psychiatric hospital serv-
ices for individuals under age 21’’;
(3) by striking paragraph (2)(C) and inserting
the following:
‘‘(C) such individuals who are determined to be
likely to require the level of care provided in a hos-
pital, nursing facility, or intermediate care facility
for the mentally retarded, or inpatient psychiatric
hospital services for individuals under age 21, are
informed of the feasible alternatives, if available
under the waiver, at the choice of such individuals,
to the provision of inpatient hospital services, nurs-
ing facility services, services in an intermediate care
facility for the mentally retarded, or inpatient psy-
chiatric hospital services for individuals under age
21;’’; and
(4) in paragraph (7)(A)—
(A) by inserting ‘‘, or inpatient psychiatric
hospital services for individuals under age 21,’’
after ‘‘intermediate care facility for the men-
tally retarded’’; and
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(B) by inserting ‘‘, or who would require
inpatient psychiatric hospital services for indi-
viduals under age 21’’ before the period.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) apply with respect to medical assistance
provided on or after January 1, 2001.
SEC. 1114. DEMONSTRATION OF COVERAGE UNDER THE
MEDICAID PROGRAM OF CHILDREN WITH PO-
TENTIALLY SEVERE DISABILITIES.
(a) STATE APPLICATION.—A State may apply to the
Secretary of Health and Human Services (in this section
referred to as the ‘‘Secretary’’) for approval of a dem-
onstration project (in this section referred to as a ‘‘dem-
onstration project’’) under which up to a specified max-
imum number of children with a potentially severe dis-
ability (as defined in subsection (b)) are provided medical
assistance under the State medicaid plan under title XIX
of the Social Security Act (42 U.S.C. 1396 et seq.).
(b) CHILD WITH
A POTENTIALLY SEVERE DIS-
ABILITY DEFINED.—
(1) IN
GENERAL.—In this section, the term
‘‘child with a potentially severe disability’’ means,
with respect to a demonstration project, an indi-
vidual who—
(A) has not attained 21 years of age;
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(B) has a physical or mental condition,
disease, disorder (including a congenital birth
defect or a metabolic condition), injury, or de-
velopmental disability that was incurred before
the individual attained such age; and
(C) is reasonably expected, but for the re-
ceipt of medical assistance under the State
medicaid plan, to reach the level of disability
defined under section 1614(a)(3) of the Social
Security Act (42 U.S.C. 1382c(a)(3)), (deter-
mined without regard to the reference to age
in subparagraph (C) of that section).
(2) EXCEPTION.—Such term does not include
an individual who would be considered disabled
under section 1614(a)(3)(C) of the Social Security
Act (42 U.S.C. 1382c(a)(3)(C)) (determined without
regard to the reference to age in that section).
(c) APPROVAL OF DEMONSTRATION PROJECTS.—
(1) IN GENERAL.—Subject to paragraph (3),
the Secretary shall approve applications under sub-
section (a) that meet the requirements of paragraph
(2) and such additional terms and conditions as the
Secretary may require. The Secretary may waive the
requirement of section 1902(a)(1) of the Social Se-
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curity Act (42 U.S.C. 1396a(a)(1)) to allow for sub-
State demonstrations.
(2) TERMS AND CONDITIONS OF DEMONSTRA-
TION PROJECTS.—The Secretary may not approve a
demonstration project under this section unless the
State provides assurances satisfactory to the Sec-
retary that the following conditions are or will be
met:
(A) 
INDEPENDENT
EVALUATION.—The
State provides for an independent evaluation of
the project to be conducted during fiscal year
2006.
(B) CONSULTATION
FOR
DEVELOPMENT
OF CRITERIA.—The State consults with appro-
priate pediatric health professionals in estab-
lishing the criteria for determining whether a
child has a potentially severe disability.
(C) ANNUAL REPORT.—The State submits
an annual report to the Secretary (in a uniform
form and manner established by the Secretary)
on the use of funds provided under the grant
that includes the following:
(i) Enrollment and financial statistics
on—
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(I) the total number of children
with a potentially severe disability en-
rolled in the demonstration project,
disaggregated by disability;
(II) the services provided by cat-
egory or code and the cost of each
service so categorized or coded; and
(III) the number of children en-
rolled in the demonstration project
who also receive services through pri-
vate insurance.
(ii) With respect to the report sub-
mitted for fiscal year 2006, the results of
the 
independent 
evaluation 
conducted
under subparagraph (A).
(iii) Such additional information as
the Secretary may require.
(3) LIMITATIONS ON FEDERAL FUNDING.—
(A) APPROPRIATION.—
(i) IN GENERAL.—Out of any funds in
the Treasury not otherwise appropriated,
there is appropriated to carry out this
section—
(I) $16,666,000 for each of fiscal
years 2002 and 2003; and
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(II) $16,667,000 for each of fis-
cal years 2004 through 2007.
(ii) BUDGET AUTHORITY.—Clause (i)
constitutes budget authority in advance of
appropriations Acts and represents the ob-
ligation of the Federal Government to pro-
vide for the payment of the amounts ap-
propriated under clause (i).
(B) LIMITATION
ON
PAYMENTS.—In no
case may—
(i) the aggregate amount of payments
made by the Secretary to States under this
section exceed $100,000,000;
(ii) the aggregate amount of payments
made by the Secretary to States for ad-
ministrative expenses relating to the eval-
uations and annual reports required under
subparagraphs (A) and (C) of paragraph
(2) 
exceed 
$2,000,000 
of 
such
$100,000,000; or
(iii) payments be provided by the Sec-
retary for a fiscal year after fiscal year
2010.
(C) FUNDS ALLOCATED TO STATES.—
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(i) IN GENERAL.—The Secretary shall
allocate funds to States based on their ap-
plications and the availability of funds. In
making such allocations, the Secretary
shall ensure an equitable distribution of
funds among States with large populations
and States with small populations.
(ii) AVAILABILITY.—Funds allocated
to a State under a grant made under this
section for a fiscal year shall remain avail-
able until expended.
(D) FUNDS NOT ALLOCATED TO STATES.—
Funds not allocated to States in the fiscal year
for which they are appropriated shall remain
available in succeeding fiscal years for alloca-
tion by the Secretary using the allocation for-
mula established under this section.
(E) PAYMENTS
TO
STATES.—The Sec-
retary shall pay to each State with a dem-
onstration project approved under this section,
from its allocation under subparagraph (C), an
amount for each quarter equal to the Federal
medical assistance percentage (as defined in
section 1905(b) of the Social Security Act (42
U.S.C. 1395d(b))) of expenditures in the quar-
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ter for medical assistance provided to children
with a potentially severe disability.
(d) RECOMMENDATION.—Not later than October 1,
2005, the Secretary shall submit a recommendation to the
Committee on Commerce of the House of Representatives
and the Committee on Finance of the Senate regarding
whether the demonstration project established under this
section should be continued after fiscal year 2007.
(e) STATE DEFINED.—In this section, the term
‘‘State’’ has the meaning given such term for purposes of
title XIX of the Social Security Act (42 U.S.C. 1396 et
seq.).
SEC. 1115. DEVELOPMENT AND SUPPORT OF FAMILY-TO-
FAMILY HEALTH INFORMATION CENTERS.
Section 501 (42 U.S.C. 701) is amended by adding
at the end the following new subsection:
‘‘(c)(1) In addition to amounts appropriated under
subsection (a) and retained under section 502(a)(1) for
the purpose of carrying out activities described in sub-
section (a)(2), there is appropriated to the Secretary, out
of any money in the Treasury not otherwise appropriated,
for the purpose of enabling the Secretary (through grants,
contracts, or otherwise) to provide for special projects of
regional and national significance for the development and
support of family-to-family health information centers de-
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scribed in paragraph (2), $10,000,000 for each of fiscal
years 2002 through 2007. Funds appropriated under this
paragraph shall remain available until expended.
‘‘(2) The family-to-family health information centers
described in this paragraph are centers that—
‘‘(A) assist families of children with disabilities
or special health care needs to make informed
choices about health care in order to promote good
treatment decisions, cost-effectiveness, and improved
health outcomes for such children;
‘‘(B) provide information regarding the health
care needs of, and resources available for, children
with disabilities or special health care needs;
‘‘(C) identify successful health delivery models
for such children;
‘‘(D) develop with representatives of health care
providers, managed care organizations, health care
purchasers, and appropriate State agencies a model
for collaboration between families of such children
and health professionals;
‘‘(E) provide training and guidance regarding
caring for such children;
‘‘(F) conduct outreach activities to the families
of such children, health professionals, schools, and
other appropriate entities and individuals; and
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‘‘(G) are staffed by families of children with
disabilities or special health care needs who have ex-
pertise in Federal and State public and private
health care systems and health professionals.
‘‘(3) The provisions of this title that are applicable
to the funds made available to the Secretary under section
502(a)(1) apply in the same manner to funds made avail-
able to the Secretary under paragraph (1).’’.
SEC. 1116. RESTORATION OF MEDICAID ELIGIBILITY FOR
CERTAIN SSI BENEFICIARIES.
(a) IN GENERAL.—Section 1902(a)(10)(A)(i)(II) (42
U.S.C. 1396a(a)(10)(A)(i)(II)) is amended—
(1) by inserting ‘‘(aa)’’ after ‘‘(II)’’;
(2) by striking ‘‘or who are’’ and inserting
‘‘, (bb) who are’’; and
(3) by inserting before the comma at the end
the following: ‘‘, or (cc) who are under 21 years of
age and with respect to whom supplemental security
income benefits would be paid under title XVI if
subparagraphs (A) and (B) of section 1611(c)(7)
were applied without regard to the phrase ‘the first
day of the month following’ ’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) shall apply to medical assistance for items
and services furnished on or after the first day of the first
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calendar quarter that begins after the date of enactment
of this Act.
CHAPTER 2—ENROLLMENT
IMPROVEMENTS
SEC. 1121. APPLICATION OF SIMPLIFIED TITLE XXI PROCE-
DURES UNDER THE MEDICAID PROGRAM.
(a) APPLICATION UNDER MEDICAID.—
(1) IN GENERAL.—Section 1902(l) of the Social
Security Act (42 U.S.C. 1396a(l)) is amended—
(A) in paragraph (3), by inserting ‘‘subject
to paragraph (5)’’, after ‘‘Notwithstanding sub-
section (a)(17),’’; and
(B) by adding at the end the following:
‘‘(5) With respect to determining the eligibility of in-
dividuals under 19 years of age (or such higher age as
the State has elected under paragraph (1)(D)) for medical
assistance under subsection (a)(10)(A) notwithstanding
any other provision of this title, if the State has estab-
lished a State child health plan under title XXI—
‘‘(A) the State may not apply a resource stand-
ard;
‘‘(B) the State shall use the same simplified eli-
gibility form (that in no case shall be more than 4
pages and that permits application other than in
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person) as the State uses under such State child
health plan with respect to such individuals;
‘‘(C) the State shall provide for initial eligibility
determinations and redeterminations of eligibility
using the same verification policies, forms, and fre-
quency as the State uses for such purposes under
such State child health plan with respect to such in-
dividuals;
‘‘(D) the State shall not require a face-to-face
interview for purposes of initial eligibility determina-
tions and redeterminations and shall allow for self-
declaration of initial eligibility and recertification in-
formation; and
‘‘(E) the State shall coordinate the enrollment
of children under this title and title XXI with the
enrollment of such children and their families in
other Federal means-tested public assistance pro-
grams, including child care programs, free or re-
duced price lunches or breakfasts under the Richard
B. Russell National School Lunch Act (42 U.S.C.
1751 et seq.), assistance under the special supple-
mental nutrition program for women, infants, and
children (WIC) under section 17 of the Child Nutri-
tion Act of 1966 (42 U.S.C. 1786), and benefits
under the Food Stamp Act of 1977.’’.
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(2) EFFECTIVE DATE.—The amendments made
by paragraph (1) apply to determinations of eligi-
bility made on or after the date that is 1 year after
the date of the enactment of this Act, whether or
not regulations implementing such amendments have
been issued.
(3) DEVELOPMENT
OF
UNIFORM
APPLICA-
TION.—Not later than 1 year after the date of en-
actment of this Act, the Secretary of Health and
Human Services, in consultation with States and or-
ganizations with expertise in outreach to, and enroll-
ment of, children without health insurance, shall de-
velop a uniform application that meets the require-
ments of section 1902(l)(5) of the Social Security
Act, as added by paragraph (1), and may be used
in any State.
(b) PRESUMPTIVE ELIGIBILITY.—
(1) IN GENERAL.—Section 1920A(b)(3)(A)(i) of
the 
Social 
Security 
Act 
(42 
U.S.C. 
1396r–
1a(b)(3)(A)(i)), as amended by section 708(a) of the
Medicare, Medicaid, and SCHIP Benefits Improve-
ment and Protection Act of 2000 (as enacted into
law by section 1(a)(6) of Public Law 106–554), is
amended by inserting ‘‘a child care resource and re-
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ferral agency,’’ after ‘‘a State or tribal child support
enforcement agency,’’.
(2) APPLICATION TO PRESUMPTIVE ELIGIBILITY
FOR PREGNANT WOMEN UNDER MEDICAID.—Section
1920(b) of the Social Security Act (42 U.S.C.
1396r–1(b)) is amended by adding at the end after
and below paragraph (2) the following flush sen-
tence:
‘‘The term ‘qualified provider’ includes a qualified entity
as defined in section 1920A(b)(3).’’.
(3) APPLICATION UNDER TITLE XXI.—
(A) IN GENERAL.—Section 2107(e)(1)(D)
of 
the 
Social 
Security 
Act 
(42 
U.S.C.
1397gg(e)(1)), as added by section 803 of the
Medicare, Medicaid, and SCHIP Benefits Im-
provement and Protection Act of 2000 (as en-
acted into law by section 1(a)(6) of Public Law
106–554), is amended to read as follows:
‘‘(D) Sections 1920 and 1920A (relating to
presumptive eligibility).’’.
(B) EXCEPTION FROM LIMITATION ON AD-
MINISTRATIVE EXPENSES.—Section 2105(c)(2)
of such Act (42 U.S.C. 1397ee(c)(2)) is amend-
ed by adding at the end the following:
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‘‘(C) EXCEPTION FOR PRESUMPTIVE ELI-
GIBILITY
EXPENDITURES.—The 
limitation
under subparagraph (A) on expenditures shall
not apply to expenditures attributable to the
application of section 1920 or 1920A (pursuant
to section 2107(e)(1)(D)), regardless of whether
the child is determined to be ineligible for the
program under this title or title XIX.’’.
(C) CONFORMING
ELIMINATION
OF
RE-
SOURCE TEST.—Section 2102(b)(1)(A) of such
Act (42 U.S.C. 1397bb(b)(1)(A)) is amended—
(i) by striking ‘‘and resources (includ-
ing any standards relating to spenddowns
and disposition of resources)’’; and
(ii) by adding at the end the fol-
lowing: ‘‘Effective 1 year after the date of
the enactment of the Leave No Child Be-
hind Act of 2001, such standards may not
include the application of a resource stand-
ard or test.’’.
(c) AUTOMATIC REASSESSMENT OF ELIGIBILITY FOR
TITLE XXI AND MEDICAID BENEFITS FOR CHILDREN
LOSING MEDICAID OR TITLE XXI ELIGIBILITY.—
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(1) LOSS OF MEDICAID ELIGIBILITY.—Section
1902(a) of the Social Security Act (42 U.S.C.
1396a(a)) is amended—
(A) by striking the period at the end of
paragraph (65) and inserting ‘‘; and’’; and
(B) by inserting after paragraph (65) the
following:
‘‘(66) provide, in the case of a State with a
State child health plan under title XXI, that before
medical assistance to a child (or a parent of a child)
is discontinued under this title, a determination of
whether the child (or parent) is eligible for benefits
under title XXI shall be made and, if determined to
be so eligible, the child (or parent) shall be auto-
matically enrolled in the program under such title
without the need for a new application.’’.
(2) LOSS OF TITLE XXI ELIGIBILITY.—Section
2102(b)(3) (42 U.S.C. 1397bb(b)(3)) is amended by
redesignating subparagraphs (D) and (E) as sub-
paragraphs (E) and (F), respectively, and by insert-
ing after subparagraph (C) the following:
‘‘(D) that before health assistance to a
child (or a parent of a child) is discontinued
under this title, a determination of whether the
child (or parent) is eligible for benefits under
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title XIX is made and, if determined to be so
eligible, the child (or parent) is automatically
enrolled in the program under such title with-
out the need for a new application;’’.
(3) EFFECTIVE DATE.—The amendments made
by paragraphs (1) and (2) apply to individuals who
lose eligibility under the medicaid program under
title XIX, or under a State child health insurance
plan under title XXI, respectively, of the Social Se-
curity Act on or after the date that is 60 days after
the date of the enactment of this Act.
(d) PROVISION OF MEDICAID AND SCHIP APPLICA-
TIONS AND INFORMATION UNDER THE SCHOOL LUNCH
PROGRAM.—Section 9(b)(2)(B) of the Richard B. Russell
National School Lunch Act (42 U.S.C. 1758(b)(2)(B)) is
amended—
(1) by striking ‘‘(B) Applications’’ and inserting
‘‘(B)(i) Applications’’; and
(2) by adding at the end the following:
‘‘(ii)(I) Applications for free and reduced price
lunches that are distributed pursuant to clause (i) to par-
ents or guardians of children in attendance at schools par-
ticipating in the school lunch program under this Act shall
also contain information on the availability of medical as-
sistance under title XIX of the Social Security Act (42
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U.S.C. 1396 et seq.) (commonly referred to as the ‘med-
icaid program’) and of child health assistance under title
XXI of such Act (commonly referred to as ‘SCHIP’), in-
cluding information on how to obtain an application for
assistance under such program.
‘‘(II) Information on the medicaid program and
SCHIP under subclause (I) shall be provided on a form
separate from the application form for free and reduced
price lunches under clause (i).’’.
(e) 12-MONTHS CONTINUOUS ELIGIBILITY.—
(1) MEDICAID.—Section 1902(e)(12) of the So-
cial Security Act (42 U.S.C. 1396a(e)(12)) is
amended—
(A) by striking ‘‘At the option of the State,
the plan may’’ and inserting ‘‘The plan shall’’;
(B) by striking ‘‘an age specified by the
State (not to exceed 19 years of age)’’ and in-
serting ‘‘19 years of age (or such higher age as
the 
State 
has 
elected 
under 
subsection
(l)(1)(D)) or who is eligible for medical assist-
ance as the parent of such a child’’;
(C) in subparagraph (A), by striking ‘‘a
period (not to exceed 12 months) ’’ and insert-
ing ‘‘the 12-month period beginning on the
date’’; and
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(D) in subparagraph (B), by inserting ‘‘or,
in the case of a parent of a child, the child)’’
after ‘‘the individual’’.
(2) TITLE
XXI.—Section 2101(b)(2) of such
Act (42 U.S.C. 1397aa(b)(2)) is amended by adding
at the end the following: ‘‘Such methods shall pro-
vide 12-months continuous eligibility for children
and parents under this title in the same manner as
section 1902(e)(12) provides 12-months continuous
eligibility for individuals described in such section
under title XIX.’’.
SEC. 1122. AUTOMATIC ENROLLMENT OF CHILDREN BORN
TO TITLE XXI PARENTS.
Section 2102(b)(1) of the Social Security Act (42
U.S.C. 1397bb(b)(1)) is amended by adding at the end
the following new subparagraph:
‘‘(C) AUTOMATIC
ELIGIBILITY
OF
CHIL-
DREN
BORN
TO
A
PARENT
BEING
PROVIDED
FAMILYCARE.—Such eligibility standards shall
provide for automatic coverage of a child born
to an individual who is provided assistance
under this title in the same manner as medical
assistance would be provided under section
1902(e)(4) to a child described in such sec-
tion.’’.
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CHAPTER 3—EFFECTIVE DATE
SEC. 1131. EFFECTIVE DATE.
(a) IN GENERAL.—Subject to subsection (b), the
amendments made by this subtitle take effect on the date
of enactment of this Act.
(b) EXTENSION OF EFFECTIVE DATE FOR STATE
LAW AMENDMENT.—In the case of a State plan under
title XIX or XXI of the Social Security Act which the Sec-
retary of Health and Human Services determines requires
State legislation in order for the plan to meet the addi-
tional requirements imposed by the amendments made by
this subtitle, such State plan shall not be regarded as fail-
ing to comply with such requirements solely on the basis
of its failure to meet the additional requirements before
the first day of the first calendar quarter beginning after
the close of the first regular session of the State legisla-
ture that begins after the date of enactment of this Act.
For purposes of the previous sentence, in the case of a
State that has a 2-year legislative session, each year of
the session is considered to be a separate regular session
of the State legislature.
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Subtitle C—Improving Access to
Care
CHAPTER 1—COMMISSION
SEC. 1201. COMMISSION ON CHILDREN’S ACCESS TO CARE.
(a) ESTABLISHMENT.—There is established a Com-
mission on Children’s Access to Care (in this section re-
ferred to as the ‘‘Commission’’).
(b) MEMBERSHIP.—
(1) COMPOSITION.—The Commission shall be
composed of 11 members of whom—
(A) 3 members shall be appointed by the
President;
(B) 2 members shall be appointed by the
Majority Leader of the Senate;
(C) 2 members shall be appointed by the
Speaker of the House of Representatives;
(D) 2 members shall be appointed by the
Minority Leader of the Senate; and
(E) 2 members shall be appointed by the
Minority Leader of the House of Representa-
tives.
(2) QUALIFICATIONS.—Members of the Com-
mission shall be appointed from among representa-
tives of children’s advocacy groups and children’s
health care providers.
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(3) TIMING OF APPOINTMENTS.—Members of
the Commission shall be appointed not later than 6
months after the date of enactment of this Act.
(4) CHAIR.—
(A) IN GENERAL.—The Commission shall
select a Chair from among its members.
(B) DUTIES.—The Chair of the Commis-
sion shall be responsible for—
(i) the assignment of duties and re-
sponsibilities among staff personnel and
their continuing supervision; and
(ii) the use and expenditure of funds
available to the Commission.
(5) VACANCIES.—Any vacancy on the Commis-
sion shall be filled in the same manner as the origi-
nal incumbent was appointed.
(6) TRAVEL EXPENSES.—The members of the
Commission shall be allowed travel expenses, includ-
ing per diem in lieu of subsistence, at rates author-
ized for employees of agencies under subchapter I of
chapter 57 of title 5, United States Code, while
away from their homes or regular places of business
in the performance of services for the Commission.
(c) MEETINGS.—
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(1) INITIAL MEETING.—Not later than 30 days
after the date on which all members of the Commis-
sion have been appointed, the Commission shall hold
its first meeting.
(2) TIME.—The Commission shall meet at the
call of the Chair.
(3) QUORUM.—A majority of the members of
the Commission shall constitute a quorum, but a
lesser number of members may hold hearings.
(d) DUTIES.—
(1) IN GENERAL.—The Commission shall con-
duct annual studies of children’s access to health
care.
(2) MATTERS STUDIED.—Each year the Com-
mission shall study—
(A) the impact of payment rates under the
medicaid and the State children’s health insur-
ance programs on access to health care and
provider participation in the delivery of health
care to children;
(B) the access to health care of children
with special health care needs, particularly
those in managed care delivery systems;
(C) the access to, and delivery of, preven-
tive health care to children;
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(D) Federal and State government efforts
to collect data, report, evaluate, and monitor
children’s access to health care, including Fed-
eral and State government deficiencies in as-
sessing children’s access to health care;
(E) the needs for supplemental and ena-
bling services to improve children’s access to
health care, including translation and transpor-
tation services; and
(F) other factors that impact the ability of
families with children to gain access to health
care services.
(3) REPORTS.—
(A) IN GENERAL.—Not later than 1 year
after the date of the initial meeting of the Com-
mission, and annually thereafter, the Commis-
sion shall submit to Congress and the President
a report.
(B) CONTENTS.—Each report shall contain
the results of the study conducted for that year
and the Commission’s recommendations to im-
prove children’s—
(i) health status; and
(ii) access to health care.
(e) POWERS OF THE COMMISSION.—
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(1) HEARINGS.—The Commission may hold
hearings, sit and act at times and places, take testi-
mony, and receive evidence as the Commission con-
siders advisable to carry out this section.
(2) INFORMATION FROM FEDERAL AGENCIES.—
The Commission may secure directly from any Fed-
eral department or agency such information as the
Commission considers necessary to carry out this
section. Upon request of the Chair of the Commis-
sion, the head of such department or agency shall
furnish such information to the Commission.
(3) POSTAL SERVICES.—The Commission may
use the United States mails in the same manner and
under the same conditions as other departments and
agencies of the Federal Government.
(4) GIFTS.—The Commission may accept, use,
and dispose of gifts or donations of services or prop-
erty.
(f) STAFF AND ADMINISTRATIVE SUPPORT.—
(1) IN GENERAL.—The Chair of the Commis-
sion may, without regard to the civil service laws
and regulations, appoint and terminate an executive
director and such other additional personnel as may
be necessary to enable the Commission to perform
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its duties. The employment of an executive director
shall be subject to confirmation by the Commission.
(2) COMPENSATION.—The Chair of the Com-
mission may fix the compensation of the executive
director and other personnel without regard to chap-
ter 51 and subchapter III of chapter 53 of title 5,
United States Code, relating to classification of posi-
tions and General Schedule pay rates, except that
the rate of pay for the executive director and other
personnel may not exceed the rate payable for level
V of the Executive Schedule under section 5316 of
title 5, United States Code.
(3) DETAIL
OF
GOVERNMENT
EMPLOYEES.—
Any Federal Government employee may be detailed
to the Commission without reimbursement, and such
detail shall be without interruption or loss of civil
service status or privilege.
(4) PROCUREMENT OF TEMPORARY AND INTER-
MITTENT SERVICES.—The Chair of the Commission
may procure temporary and intermittent services
under section 3109(b) of title 5, United States Code,
at rates for individuals which do not exceed the daily
equivalent of the annual rate of basic pay prescribed
for level V of the Executive Schedule under section
5316 of title 5, United States Code.
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CHAPTER 2—CHILDREN’S HEALTH
INSURANCE ACCOUNTABILITY
SEC. 1211. SHORT TITLE.
This chapter may be cited as the ‘‘Children’s Health
Insurance Accountability Act of 2001’’.
SEC. 1212. FINDINGS.
Congress makes the following findings:
(1) Children have health and development needs
that are markedly different than those for the adult
population.
(2) Children experience complex and continuing
changes during the continuum from birth to adult-
hood in which appropriate health care is essential
for optimal development.
(3) The vast majority of work done on develop-
ment methods to assess the effectiveness of health
care services and the impact of medical care on pa-
tient outcomes and patient satisfaction has been fo-
cused on adults.
(4) Health outcome measures need to be age,
gender, and developmentally appropriate to be useful
to families and children.
(5) Costly disorders of adulthood often have
their origins in childhood, making early access to ef-
fective health services in childhood essential.
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(6) More than 200 chronic conditions, disabil-
ities and diseases affect children, including asthma,
diabetes, sickle cell anemia, spina bifida, epilepsy,
autism, cerebral palsy, congenital heart disease,
mental retardation, and cystic fibrosis. These chil-
dren need the services of specialists who have in
depth knowledge about their particular condition.
(7) Children’s patterns of illness, disability and
injury differ dramatically from adults.
SEC. 1213. AMENDMENTS TO THE PUBLIC HEALTH SERVICE
ACT.
(a) 
PATIENT
PROTECTION
STANDARDS.—Title
XXVII of the Public Health Service Act (42 U.S.C. 300gg
et seq.) is amended—
(1) by redesignating part C as part D; and
(2) by inserting after part B the following new
part:
‘‘PART C—CHILDREN’S HEALTH PROTECTION
STANDARDS
‘‘SEC. 2770. ACCESS TO CARE.
‘‘(a) ACCESS TO APPROPRIATE PRIMARY CARE PRO-
VIDERS.—
‘‘(1) IN GENERAL.—If a group health plan, or
a health insurance issuer in connection with the pro-
vision of health insurance coverage, requires or pro-
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vides for an enrollee to designate a participating pri-
mary care provider for a child of such enrollee—
‘‘(A) the plan or issuer shall permit the en-
rollee to designate a physician who specializes
in pediatrics as the child’s primary care pro-
vider; and
‘‘(B) if such an enrollee has not designated
such a provider for the child, the plan or issuer
shall consider appropriate pediatric expertise in
mandatorily assigning such an enrollee to a pri-
mary care provider.
‘‘(2) CONSTRUCTION.—Nothing in paragraph
(1) shall waive any requirements of coverage relating
to medical necessity or appropriateness with respect
to coverage of services.
‘‘(b) ACCESS TO PEDIATRIC SPECIALTY SERVICES.—
‘‘(1) REFERRAL TO SPECIALTY CARE FOR CHIL-
DREN REQUIRING TREATMENT BY SPECIALISTS.—
‘‘(A) IN GENERAL.—In the case of a child
who is covered under a group health plan, or
health insurance coverage offered by a health
insurance issuer and who has a mental or phys-
ical condition, disability, or disease of sufficient
seriousness and complexity to require diagnosis,
evaluation or treatment by a specialist, the plan
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or issuer shall make or provide for a referral
to a specialist who has extensive experience or
training, and is available and accessible to pro-
vide the treatment for such condition or dis-
ease, including the choice of a nonprimary care
physician specialist participating in the plan or
a referral to a nonparticipating provider as pro-
vided for under subparagraph (D) if such a pro-
vider is not available within the plan.
‘‘(B) SPECIALIST DEFINED.—For purposes
of this subsection, the term ‘specialist’ means,
with respect to a condition, disability, or dis-
ease, a health care practitioner, facility, or cen-
ter (such as a center of excellence) that has ex-
tensive pediatric expertise through appropriate
training or experience to provide high quality
care in treating the condition, disability or dis-
ease.
‘‘(C) REFERRALS TO PARTICIPATING PRO-
VIDERS.—A plan or issuer is not required under
subparagraph (A) to provide for a referral to a
specialist that is not a participating provider,
unless the plan or issuer does not have an ap-
propriate specialist that is available and acces-
sible to treat the enrollee’s condition and that
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is a participating provider with respect to such
treatment.
‘‘(D) TREATMENT OF NONPARTICIPATING
PROVIDERS.—If a plan or issuer refers a child
enrollee to a nonparticipating specialist, services
provided pursuant to the referral shall be pro-
vided at no additional cost to the enrollee be-
yond what the enrollee would otherwise pay for
services received by such a specialist that is a
participating provider.
‘‘(E) SPECIALISTS AS PRIMARY CARE PRO-
VIDERS.—A plan or issuer shall have in place a
procedure under which a child who is covered
under health insurance coverage provided by
the plan or issuer who has a condition or dis-
ease that requires specialized medical care over
a prolonged period of time shall receive a refer-
ral to a pediatric specialist affiliated with the
plan, or if not available within the plan, to a
nonparticipating provider for such condition
and such specialist may be responsible for and
capable of providing and coordinating the
child’s primary and specialty care.
‘‘(2) STANDING REFERRALS.—
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‘‘(A) IN GENERAL.—A group health plan,
or health insurance issuer in connection with
the provision of health insurance coverage of a
child, shall have a procedure by which a child
who has a condition, disability, or disease that
requires ongoing care from a specialist may re-
quest and obtain a standing referral to such
specialist for treatment of such condition. If the
primary care provider in consultation with the
medical director of the plan or issuer and the
specialist (if any), determines that such a
standing referral is appropriate, the plan or
issuer shall authorize such a referral to such a
specialist. Such standing referral shall be con-
sistent with a treatment plan.
‘‘(B) TREATMENT PLANS.—A group health
plan, or health insurance issuer, with the par-
ticipation of the family and the health care pro-
viders of the child, shall develop a treatment
plan for a child who requires ongoing care that
covers a specified period of time (but in no
event less than a 6-month period). Services pro-
vided for under the treatment plan shall not re-
quire additional approvals or referrals through
a gatekeeper.
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‘‘(C) TERMS
OF
REFERRAL.—The provi-
sions of subparagraph (C) and (D) of para-
graph (1) shall apply with respect to referrals
under subparagraph (A) in the same manner as
they apply to referrals under paragraph (1)(A).
‘‘(c) ADEQUACY OF ACCESS.—For purposes of sub-
sections (a) and (b), a group health plan or health insur-
ance issuer in connection with health insurance coverage
shall ensure that a sufficient number, distribution, and va-
riety of qualified participating health care providers are
available so as to ensure that all covered health care serv-
ices, including specialty services, are available and acces-
sible to all enrollees in a timely manner.
‘‘(d) COVERAGE OF EMERGENCY SERVICES.—
‘‘(1) IN GENERAL.—If a group health plan, or
health insurance coverage offered by a health insur-
ance issuer, provides any benefits for children with
respect to emergency services (as defined in para-
graph (2)(A)), the plan or issuer shall cover emer-
gency 
services 
furnished 
under 
the 
plan 
or
coverage—
‘‘(A) without the need for any prior au-
thorization determination;
‘‘(B) whether or not the physician or pro-
vider furnishing such services is a participating
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physician or provider with respect to such serv-
ices; and
‘‘(C) without regard to any other term or
condition of such coverage (other than exclusion
of benefits, or an affiliation or waiting period,
permitted under section 2701).
‘‘(2) DEFINITIONS.—In this subsection:
‘‘(A) EMERGENCY
MEDICAL
CONDITION
BASED ON PRUDENT LAYPERSON STANDARD.—
The term ‘emergency medical condition’ means
a medical condition manifesting itself by acute
symptoms of sufficient severity (including se-
vere pain) such that a prudent layperson, who
possesses an average knowledge of health and
medicine, could reasonably expect the absence
of immediate medical attention to result in a
condition described in clause (i), (ii), or (iii) of
section 1867(e)(1)(A) of the Social Security
Act.
‘‘(B) EMERGENCY
SERVICES.—The term
‘emergency services’ means—
‘‘(i) a medical screening examination
(as required under section 1867 of the So-
cial Security Act) that is within the capa-
bility of the emergency department of a
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hospital, including ancillary services rou-
tinely available to the emergency depart-
ment to evaluate an emergency medical
condition (as defined in subparagraph
(A)); and
‘‘(ii) within the capabilities of the
staff and facilities available at the hospital,
such further medical examination and
treatment as are required under section
1867 of such Act to stabilize the patient.
‘‘(3) 
REIMBURSEMENT
FOR
MAINTENANCE
CARE
AND
POST-STABILIZATION
CARE.—A group
health plan, and health insurance issuer offering
health insurance coverage, shall provide, in covering
services other than emergency services, for reim-
bursement with respect to services which are other-
wise covered and which are provided to an enrollee
other than through the plan or issuer if the services
are maintenance care or post-stabilization care cov-
ered under the guidelines established under section
1852(d) of the Social Security Act (relating to pro-
moting efficient and timely coordination of appro-
priate maintenance and post-stabilization care of an
enrollee after an enrollee has been determined to be
stable).
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‘‘(e) PROHIBITION
ON FINANCIAL BARRIERS.—A
health insurance issuer in connection with the provision
of health insurance coverage may not impose any cost
sharing for pediatric specialty services provided under
such coverage to enrollee children in amounts that exceed
the cost-sharing required for other specialty care under
such coverage.
‘‘(f) CHILDREN
WITH
SPECIAL
HEALTH
CARE
NEEDS.—A health insurance issuer in connection with the
provision of health insurance coverage shall ensure that
such coverage provides special consideration for the provi-
sion of services to enrollee children with special health care
needs. Appropriate procedures shall be implemented to
provide care for children with special health care needs.
The development of such procedures shall include partici-
pation by the families of such children.
‘‘(g) DEFINITIONS.—In this part:
‘‘(1) CHILD.—The term ‘child’ means an indi-
vidual who is under 19 years of age.
‘‘(2) CHILDREN WITH SPECIAL HEALTH CARE
NEEDS.—The term ‘children with special health care
needs’ means those children who have or are at ele-
vated risk for chronic physical, developmental, be-
havioral or emotional conditions and who also re-
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quire health and related services of a type and
amount not usually required by children.
‘‘SEC. 2771. CONTINUITY OF CARE.
‘‘(a) IN GENERAL.—If a contract between a health
insurance issuer, in connection with the provision of health
insurance coverage, and a health care provider is termi-
nated (other than by the issuer for failure to meet applica-
ble quality standards or for fraud) and an enrollee is un-
dergoing a course of treatment from the provider at the
time of such termination, the issuer shall—
‘‘(1) notify the enrollee of such termination,
and
‘‘(2) subject to subsection (c), permit the en-
rollee to continue the course of treatment with the
provider during a transitional period (provided under
subsection (b)).
‘‘(b) TRANSITIONAL PERIOD.—
‘‘(1) IN GENERAL.—Except as provided in para-
graphs (2) through (4), the transitional period under
this subsection shall extend for at least—
‘‘(A) 60 days from the date of the notice
to the enrollee of the provider’s termination in
the case of a primary care provider, or
‘‘(B) 120 days from such date in the case
of another provider.
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‘‘(2) INSTITUTIONAL
CARE.—The transitional
period under this subsection for institutional or in-
patient care from a provider shall extend until the
discharge or termination of the period of institu-
tionalization and shall include reasonable follow-up
care related to the institutionalization and shall also
include institutional care scheduled prior to the date
of termination of the provider status.
‘‘(3) PREGNANCY.—If—
‘‘(A) an enrollee has entered the second
trimester of pregnancy at the time of a pro-
vider’s termination of participation, and
‘‘(B) the provider was treating the preg-
nancy before date of the termination,
the transitional period under this subsection with re-
spect to provider’s treatment of the pregnancy shall
extend through the provision of post-partum care di-
rectly related to the delivery.
‘‘(4) TERMINAL ILLNESS.—
‘‘(A) IN GENERAL.—If—
‘‘(i) an enrollee was determined to be
terminally ill (as defined in subparagraph
(B)) at the time of a provider’s termi-
nation of participation, and
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‘‘(ii) the provider was treating the ter-
minal illness before the date of termi-
nation,
the transitional period under this subsection
shall extend for the remainder of the enrollee’s
life for care directly related to the treatment of
the terminal illness.
‘‘(B) DEFINITION.—In subparagraph (A),
an enrollee is considered to be ‘terminally ill’ if
the enrollee has a medical prognosis that the
enrollee’s life expectancy is 6 months or less.
‘‘(c) PERMISSIBLE TERMS
AND CONDITIONS.—An
issuer may condition coverage of continued treatment by
a provider under subsection (a)(2) upon the provider
agreeing to the following terms and conditions:
‘‘(1) The provider agrees to continue to accept
reimbursement from the issuer at the rates applica-
ble prior to the start of the transitional period as
payment in full.
‘‘(2) The provider agrees to adhere to the
issuer’s quality assurance standards and to provide
to the issuer necessary medical information related
to the care provided.
‘‘(3) The provider agrees otherwise to adhere to
the issuer’s policies and procedures, including proce-
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dures regarding referrals and obtaining prior au-
thorization and providing services pursuant to a
treatment plan approved by the issuer.
‘‘SEC. 2772. CONTINUOUS QUALITY IMPROVEMENT.
‘‘(a) IN GENERAL.—A health insurance issuer that
offers health insurance coverage for children shall estab-
lish and maintain an ongoing, internal quality assurance
program that at a minimum meets the requirements of
subsection (b).
‘‘(b) REQUIREMENTS.—The internal quality assur-
ance program of an issuer under subsection (a) shall—
‘‘(1) establish and measure a set of health care,
functional assessments, structure, processes and out-
comes, and quality indicators that are unique to chil-
dren and based on nationally accepted standards or
guidelines of care;
‘‘(2) maintain written protocols consistent with
recognized clinical guidelines or current consensus
on the pediatric field, to be used for purposes of in-
ternal utilization review, with periodic updating and
evaluation by pediatric specialists to determine effec-
tiveness in controlling utilization;
‘‘(3) provide for peer review by health care pro-
fessionals of the structure, processes, and outcomes
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related to the provision of health services, including
pediatric review of pediatric cases;
‘‘(4) include in member satisfaction surveys,
questions on child and family satisfaction and expe-
rience of care, including care to children with special
needs;
‘‘(5) monitor and evaluate the continuity of
care with respect to children;
‘‘(6) include pediatric measures that are di-
rected at meeting the needs of at-risk children and
children with chronic conditions, disabilities and se-
vere illnesses;
‘‘(7) maintain written guidelines to ensure the
availability of medications appropriate to children;
‘‘(8) use focused studies of care received by
children with certain types of chronic conditions and
disabilities and focused studies of specialized services
used by children with chronic conditions and disabil-
ities;
‘‘(9) monitor access to pediatric specialty serv-
ices; and
‘‘(10) monitor child health care professional
satisfaction.
‘‘(c) UTILIZATION REVIEW ACTIVITIES.—
‘‘(1) COMPLIANCE WITH REQUIREMENTS.—
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‘‘(A) IN
GENERAL.—A health insurance
issuer that offers health insurance coverage for
children shall conduct utilization review activi-
ties in connection with the provision of such
coverage only in accordance with a utilization
review program that meets at a minimum the
requirements of this subsection.
‘‘(B) DEFINITIONS.—In this subsection:
‘‘(i) CLINICAL
PEERS.—The term
‘clinical peer’ means, with respect to a re-
view, a physician or other health care pro-
fessional who holds a non-restricted license
in a State and in the same or similar spe-
cialty as typically manages the pediatric
medical condition, procedure, or treatment
under review.
‘‘(ii) HEALTH CARE PROFESSIONAL.—
The term ‘health care professional’ means
a physician or other health care practi-
tioner licensed or certified under State law
to provide health care services and who is
operating within the scope of such licen-
sure or certification.
‘‘(iii) 
UTILIZATION
REVIEW.—The
terms ‘utilization review’ and ‘utilization
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review activities’ mean procedures used to
monitor or evaluate the clinical necessity,
appropriateness, efficacy, or efficiency of
health care services, procedures or settings
for children, and includes prospective re-
view, concurrent review, second opinions,
case management, discharge planning, or
retrospective review specific to children.
‘‘(2) WRITTEN POLICIES AND CRITERIA.—
‘‘(A) WRITTEN
POLICIES.—A utilization
review program shall be conducted consistent
with written policies and procedures that govern
all aspects of the program.
‘‘(B) USE OF WRITTEN CRITERIA.—A utili-
zation review program shall utilize written clin-
ical review criteria specific to children and de-
veloped pursuant to the program with the input
of appropriate physicians, including pediatri-
cians, nonprimary care pediatric specialists, and
other child health professionals.
‘‘(C) ADMINISTRATION BY HEALTH CARE
PROFESSIONALS.—A utilization review program
shall be administered by qualified health care
professionals, including health care profes-
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sionals with pediatric expertise who shall over-
see review decisions.
‘‘(3) USE OF QUALIFIED, INDEPENDENT PER-
SONNEL.—
‘‘(A) IN
GENERAL.—A utilization review
program shall provide for the conduct of utiliza-
tion review activities only through personnel
who are qualified and, to the extent required,
who have received appropriate pediatric or child
health training in the conduct of such activities
under the program.
‘‘(B) PEER REVIEW OF ADVERSE CLINICAL
DETERMINATIONS.—A utilization review pro-
gram shall provide that clinical peers shall
evaluate the clinical appropriateness of adverse
clinical determinations and divergent clinical
options.
‘‘SEC. 2773. APPEALS AND GRIEVANCE MECHANISMS FOR
CHILDREN.
‘‘(a) INTERNAL APPEALS PROCESS.—A health insur-
ance issuer in connection with the provision of health in-
surance coverage for children shall establish and maintain
a system to provide for the resolution of complaints and
appeals regarding all aspects of such coverage. Such a sys-
tem shall include an expedited procedure for appeals on
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behalf of a child enrollee in situations in which the time
frame of a standard appeal would jeopardize the life,
health, or development of the child.
‘‘(b) EXTERNAL APPEALS PROCESS.—A health in-
surance issuer in connection with the provision of health
insurance coverage for children shall provide for an inde-
pendent external review process that meets the following
requirements:
‘‘(1) External appeal activities shall be con-
ducted through clinical peers, a physician or other
health care professional who is appropriately
credentialed in pediatrics with the same or similar
specialty and typically manages the condition, proce-
dure, or treatment under review or appeal.
‘‘(2) External appeal activities shall be con-
ducted through an entity that has sufficient pedi-
atric expertise, including subspecialty expertise, and
staffing to conduct external appeal activities on a
timely basis.
‘‘(3) Such a review process shall include an ex-
pedited procedure for appeals on behalf of a child
enrollee in which the time frame of a standard ap-
peal would jeopardize the life, health, or development
of the child.
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‘‘SEC. 2774. ACCOUNTABILITY THROUGH DISTRIBUTION OF
INFORMATION.
‘‘(a) IN GENERAL.—A health insurance issuer in con-
nection with the provision of health insurance coverage for
children shall submit to enrollees (and prospective enroll-
ees), and make available to the public, in writing the
health-related information described in subsection (b).
‘‘(b) INFORMATION.—The information to be provided
under subsection (a) shall include a report of measures
of structures, processes, and outcomes regarding each
health insurance product offered to participants and de-
pendents in a manner that is separate for both the adult
and child enrollees, using measures that are specific to
each group.’’.
(b) APPLICATION TO GROUP HEALTH INSURANCE
COVERAGE.—
(1) IN GENERAL.—Subpart 2 of part A of title
XXVII of the Public Health Service Act (42 U.S.C.
300gg-4 et seq.) is amended by adding at the end
the following new section:
‘‘SEC. 2707. CHILDREN’S HEALTH ACCOUNTABILITY STAND-
ARDS.
‘‘(a) IN GENERAL.—Each health insurance issuer
shall comply with children’s health accountability require-
ment under part C with respect to group health insurance
coverage it offers.
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‘‘(b) ASSURING COORDINATION.—The Secretary of
Health and Human Services and the Secretary of Labor
shall ensure, through the execution of an interagency
memorandum of understanding between such Secretaries,
that—
‘‘(1) regulations, rulings, and interpretations
issued by such Secretaries relating to the same mat-
ter over which such Secretaries have responsibility
under part C (and this section) and section 714 of
the Employee Retirement Income Security Act of
1974 are administered so as to have the same effect
at all times; and
‘‘(2) coordination of policies relating to enforc-
ing the same requirements through such Secretaries
in order to have a coordinated enforcement strategy
that avoids duplication of enforcement efforts and
assigns priorities in enforcement.’’.
(2) CONFORMING AMENDMENT.—Section 2792
of the Public Health Service Act (42 U.S.C. 300gg–
92) is amended by inserting ‘‘and section 2707(b)’’
after ‘‘of 1996’’.
(c) APPLICATION TO INDIVIDUAL HEALTH INSUR-
ANCE COVERAGE.—Part B of title XXVII of the Public
Health Service Act (42 U.S.C. 300gg-41 et seq.) is amend-
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ed by inserting after section 2752 the following new sec-
tion:
‘‘SEC. 2753. CHILDREN’S HEALTH ACCOUNTABILITY STAND-
ARDS.
‘‘Each health insurance issuer shall comply with chil-
dren’s health accountability requirements under part C
with respect to individual health insurance coverage it of-
fers.’’.
(d) MODIFICATION OF PREEMPTION STANDARDS.—
(1) GROUP HEALTH INSURANCE COVERAGE.—
Section 2723 of the Public Health Service Act (42
U.S.C. 300gg–23) is amended—
(A) in subsection (a)(1), by striking ‘‘sub-
section (b)’’ and inserting ‘‘subsections (b) and
(c)’’;
(B) by redesignating subsections (c) and
(d) as subsections (d) and (e), respectively; and
(C) by inserting after subsection (b) the
following new subsection:
‘‘(c) SPECIAL RULES
IN CASE
OF CHILDREN’S
HEALTH ACCOUNTABILITY REQUIREMENTS.—Subject to
subsection (a)(2), the provisions of section 2707 and part
C, and part D insofar as it applies to section 2707 or part
C, shall not prevent a State from establishing require-
ments relating to the subject matter of such provisions
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so long as such requirements are at least as stringent on
health insurance issuers as the requirements imposed
under such provisions.’’.
(2) INDIVIDUAL
HEALTH
INSURANCE
COV-
ERAGE.—Section 2762 of the Public Health Service
Act (42 U.S.C. 300gg–62), as added by section
605(b)(3)(B) of Public Law 104–204, is amended—
(A) in subsection (a), by striking ‘‘sub-
section (b), nothing in this part’’ and inserting
‘‘subsections (b) and (c)’’, and
(B) by adding at the end the following new
subsection:
‘‘(c) SPECIAL RULES
IN CASE
OF CHILDREN’S
HEALTH ACCOUNTABILITY REQUIREMENTS.—Subject to
subsection (b), the provisions of section 2753 and part C,
and part D insofar as it applies to section 2753 or part
C, shall not prevent a State from establishing require-
ments relating to the subject matter of such provisions
so long as such requirements are at least as stringent on
health insurance issuers as the requirements imposed
under such section.’’.
SEC. 1214. AMENDMENTS TO THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974.
(a) IN GENERAL.—Subpart B of part 7 of subtitle
B of title I of the Employee Retirement Income Security
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Act of 1974 (29 U.S.C. 1185 et seq.) is amended by add-
ing at the end the following:
‘‘SEC. 714. CHILDREN’S HEALTH ACCOUNTABILITY STAND-
ARDS.
‘‘(a) IN GENERAL.—Subject to subsection (b), the
provisions of part C of title XXVII of the Public Health
Service Act shall apply under this subpart and part to a
group health plan (and group health insurance coverage
offered in connection with a group health plan) as if such
part were incorporated in this section.
‘‘(b) APPLICATION.—In applying subsection (a)
under this subpart and part, any reference in such part
C—
‘‘(1) to health insurance coverage is deemed to
be a reference only to group health insurance cov-
erage offered in connection with a group health plan
and to also be a reference to coverage under a group
health plan;
‘‘(2) to a health insurance issuer is deemed to
be a reference only to such an issuer in relation to
group health insurance coverage or, with respect to
a group health plan, to the plan;
‘‘(3) to the Secretary is deemed to be a ref-
erence to the Secretary of Labor;
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‘‘(4) to an applicable State authority is deemed
to be a reference to the Secretary of Labor; and
‘‘(5) to an enrollee with respect to health insur-
ance coverage is deemed to include a reference to a
participant or beneficiary with respect to a group
health plan.’’.
(b) MODIFICATION OF PREEMPTION STANDARDS.—
Section 731 of the Employee Retirement Income Security
Act of 1974 (42 U.S.C. 1191) is amended—
(1) in subsection (a)(1), by striking ‘‘subsection
(b)’’ and inserting ‘‘subsections (b) and (c)’’;
(2) by redesignating subsections (c) and (d) as
subsections (d) and (e), respectively; and
(3) by inserting after subsection (b) the fol-
lowing new subsection:
‘‘(c) SPECIAL RULES
IN CASE
OF PATIENT AC-
COUNTABILITY REQUIREMENTS.—Subject to subsection
(a)(2), the provisions of section 714, shall not prevent a
State from establishing requirements relating to the sub-
ject matter of such provisions so long as such require-
ments are at least as stringent on group health plans and
health insurance issuers in connection with group health
insurance coverage as the requirements imposed under
such provisions.’’.
(c) CONFORMING AMENDMENTS.—
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(1) Section 732(a) of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1185(a)) is
amended by striking ‘‘section 711’’ and inserting
‘‘sections 711 and 714’’.
(2) The table of contents in section 1 of the
Employee Retirement Income Security Act of 1974
is amended by inserting after the item relating to
section 713 the following new item:
‘‘Sec. 714. Children’s health accountability standards.’’.
SEC. 1215. STUDIES.
(a) BY SECRETARY.—Not later than 1 year after the
date of enactment of this Act, the Secretary of Health and
Human Services shall conduct a study, and prepare and
submit to Congress a report, concerning—
(1) the unique characteristics of patterns of ill-
ness, disability, and injury in children;
(2) the development of measures of quality of
care and outcomes related to the health care of chil-
dren; and
(3) the access of children to primary mental
health services and the coordination of managed be-
havioral health services.
(b) BY GAO.—
(1) MANAGED CARE.—Not later than 1 year
after the date of enactment of this Act, the General
Accounting Office shall conduct a study, and pre-
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pare and submit to the Committee on Health, Edu-
cation, Labor, and Pensions of the Senate and the
Committee on Energy and Commerce of the House
of Representatives a report, concerning—
(A) an assessment of the structure and
performance of non-governmental health plans,
medicaid managed care organizations, plans
under title XIX of the Social Security Act (42
U.S.C. 1396 et seq.), and the program under
title XXI of the Social Security Act (42 U.S.C.
1397aa et seq.) serving the needs of children
with special health care needs;
(B) an assessment of the structure and
performance of non-governmental plans in serv-
ing the needs of children as compared to med-
icaid managed care organizations under title
XIX of the Social Security Act (42 U.S.C. 1396
et seq.); and
(C) the emphasis that private managed
care health plans place on primary care and the
control of services as it relates to care and serv-
ices provided to children with special health
care needs.
(2) PLAN SURVEY.—Not later than 1 year after
the date of enactment of this Act, the General Ac-
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counting Office shall prepare and submit to the
Committee on Health, Education, Labor, and Pen-
sions of the Senate and the Committee on Energy
and Commerce of the House of Representatives a re-
port that contains a survey of health plan activities
that address the unique health needs of adolescents,
including quality measures for adolescents and inno-
vative practice arrangement.
CHAPTER 3—EPSDT
SEC. 1221. COLLECTION OF DATA REGARDING THE DELIV-
ERY OF EPSDT SERVICES.
Section 1902(a)(43) of the Social Security Act (42
U.S.C. 1396a(a)(43)) is amended—
(1) in subparagraph (C), by striking ‘‘and’’ at
the end;
(2) in subparagraph (D)(iv), by striking the
semicolon and inserting ‘‘, and’’; and
(3) by inserting after subparagraph (D)(iv), the
following new subparagraph:
‘‘(E) beginning with fiscal year 2003, re-
porting to the Secretary (in a uniform form and
manner established by the Secretary that does
not identify individual patients and that allows
for the comparison of data within and among
States) the following information relating to
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early and periodic screening, diagnostic, and
treatment services provided to each child en-
rolled under the plan during each fiscal year:
‘‘(i) as of the date of enrollment of
the child, the child’s—
‘‘(I) age, State of residence, gen-
der, and race/ethnicity,
‘‘(II) the basis for eligibility for
medical assistance,
‘‘(III) immunization history,
‘‘(IV) blood-lead level,
‘‘(V) weight and height percentile
compared to the widely accepted
standard percentiles for the child’s
age,
‘‘(VI) general health and any
chronic conditions or disabilities, and
‘‘(VII) the primary service deliv-
ery arrangement (such as fee-for-serv-
ice, managed care, preferred provider
organization, or other provider prac-
tice arrangement); and
‘‘(ii) throughout the fiscal year (at
such intervals as the Secretary shall speci-
fy)—
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‘‘(I) the number of medical
screenings the child received and a
specific description of the services per-
formed as part of such screenings
(such as the weighing and measuring
of the child and the administering of
a blood-lead level test),
‘‘(II) the number of screenings
the child received for vision and hear-
ing problems,
‘‘(III) the number of dental
screenings the child received,
‘‘(IV) 
information 
regarding
whether a condition was discovered
from any of such screenings, whether
the child was referred for, and re-
ceived, further treatment, and if so,
the number of visits, and the treat-
ments received, and
‘‘(V) the actual or estimated
costs of each of such screenings and
treatments,
‘‘(VI) 
information 
regarding
whether such screenings and treat-
ments are more comprehensive that
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similar screenings and treatments pro-
vided to adult individuals enrolled in
the plan, and
‘‘(VII) the service delivery ar-
rangement for such screening and
treatment provided;’’.
Subtitle D—Reducing Public
Health Risks
CHAPTER 1—ASTHMA TREATMENTS
SEC. 1301. FINDINGS.
Congress finds that—
(1)(A) asthma is 1 of the most common and
deadly diseases in the United States, affecting an es-
timated 14,000,000 to 15,000,000 individuals in the
United States, including almost 5,000,000 children;
(B) asthma is the most common chronic illness
in children, affecting an estimated 7 percent of chil-
dren in the United States;
(C) although asthma can occur at any age,
about 80 percent of the children who develop asthma
do so before starting school;
(D) asthma is the single greatest cause of
school absenteeism, with 10,100,000 days missed
from school per year in the United States; and
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(E) according to a 1995 National Institutes of
Health workshop report, the cost of lost productivity
from missed school days for parents of children with
asthma is estimated at $1,000,000,000 per year;
and
(2)(A) vision and hearing screening is an essen-
tial part of child health care;
(B) a vision or hearing deficit may undermine
a child’s ability to learn;
(C) the Chicago public school system has deter-
mined through vision screening that a far higher
number of children identified as failing academically
suffer from vision impairment;
(D) students who have failed a grade 1 or more
times are even more likely to have a vision problem;
(E) more than 30 percent of students in Chi-
cago public schools who were retained during the
1998-1999 school year failed their school-based vi-
sion screening, a rate that is 50 percent higher than
children who were not failing;
(F) schools play a critical role in promoting a
clear link between visual and hearing acuity and
academic performance;
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(G) providing vision and hearing screening in
schools helps children receive those essential health
care services in a timely fashion;
(H) many parents find it difficult to take time
off work in order to ensure that their children re-
ceive preventive or other nonemergency health care
services; and
(I) allowing children to receive nonemergency
health care services at school would ensure that the
children receive services that promote healthy lives
and better academic achievement.
SEC. 1302. ASTHMA, VISION, AND HEARING SCREENING FOR
EARLY HEAD START AND HEAD START PRO-
GRAMS.
(a) EARLY HEAD START PROGRAMS.—Section 645A
of the Head Start Act (42 U.S.C. 9840a) is amended by
adding at the end the following:
‘‘(h) ASTHMA, VISION, AND HEARING SCREENING.—
‘‘(1) IN GENERAL.—An entity that receives as-
sistance under this section may carry out a program
under which the entity—
‘‘(A) determines whether a child eligible to
participate in the program described in sub-
section (a)(1) has received each of an asthma,
vision, and hearing screening test using a test
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that is appropriate for age and risk factors on
the enrollment of the child in the program; and
‘‘(B) in the case of a child who has not re-
ceived each of an asthma, and vision, and hear-
ing screening test, ensures that the enrolled
child receives such a test either by referral or
by performing the test (under contract or other-
wise).
‘‘(2) REIMBURSEMENT.—
‘‘(A) IN GENERAL.—On the request of an
entity that performs or arranges for the per-
formance of an asthma, vision, or hearing
screening test under paragraph (1) on a child
who is eligible for or receiving medical assist-
ance under a State plan under title XIX of the
Social Security Act (42 U.S.C. 1396 et seq.),
the Secretary of Health and Human Services,
notwithstanding any other provision of, or limi-
tation under, title XIX of the Social Security
Act, shall reimburse the entity, from funds that
are made available under that title, for 100 per-
cent of the cost of the test and data reporting.
‘‘(B) COSTS.—The costs of a test con-
ducted under this subsection—
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‘‘(i) shall include reimbursement for
testing devices and associated supplies ap-
proved for sale by the Food and Drug Ad-
ministration and used in compliance with
section 353 of the Public Health Service
Act (42 U.S.C. 263a); and
‘‘(ii) shall include reimbursement for
administering the tests and related serv-
ices, as determined appropriate by the
State agency.
‘‘(3) HEAD START.—This subsection shall apply
to Head Start programs that include coverage, di-
rectly or indirectly, for infants and toddlers under
the age of 3 years.’’.
(b) HEAD START PROGRAMS.—Section 642(b) of the
Head Start Act (42 U.S.C. 9837(b)) is amended—
(1) in paragraph (10), by striking ‘‘and’’ at the
end;
(2) in paragraph (11), by striking the period at
the end and inserting ‘‘; and’’; and
(3) by adding at the end the following:
‘‘(12) with respect to an agency that elects to
carry out a program under section 645(h), comply
with the requirements of such section 645A(h) in the
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case of each child eligible to participate in the Head
Start program to be carried out by the agency.’’.
(c) PAYMENTS FOR SCREENING AND TREATMENT
PROVIDED TO CHILDREN ELIGIBLE UNDER MEDICAID OR
SCHIP.—
(1) MEDICAID.—Section 1903(c) of the Social
Security Act (42 U.S.C. 1396b(c)) is amended—
(A) by inserting ‘‘(1)’’ after ‘‘(c)’’; and
(B) by adding at the end the following:
‘‘(2) Nothing in this title or any other provision of
law, including the payment limitation commonly known as
the ‘free care rule’, shall be construed as prohibiting or
restricting, or authorizing the Secretary to prohibit or re-
strict, payment under subsection (a) for medical assist-
ance for covered services furnished to a child who is eligi-
ble for or receiving medical assistance under the State
plan and who receives an asthma, vision, hearing, or other
health screening test, or is provided treatment, education
in disease management, corrective eyewear, or hearing
aids, through a public elementary or secondary school,
whether directly or indirectly, and regardless of whether
the school participates in a program established under
subsection (a) or (b) of section 320B of the Public Health
Service Act.’’.
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(2) SCHIP.—Section 2105 of the Social Secu-
rity Act (42 U.S.C.1397ee) is amended by adding at
the end the following:
‘‘(g) REQUIRED PAYMENT FOR CERTAIN SCHOOL-
BASED SERVICES.—Nothing in this title or any other pro-
vision of law (including the payment limitation under title
XIX commonly known as the ‘free care rule’ to the extent,
if any, such limitation applies to the program established
under this title), shall be construed as prohibiting or re-
stricting, or authorizing the Secretary to prohibit or re-
strict, payment under subsection (a) for child health as-
sistance for covered services furnished to a child who is
eligible for or receiving such assistance under the State
plan and who receives an asthma, vision, or hearing
screening test, or other health screening test that is avail-
able to children receiving assistance under the State plan,
or is provided treatment, education in disease manage-
ment, corrective eyewear, or hearing aids through a public
elementary or secondary school, whether directly or indi-
rectly, and regardless of whether the school participates
in a program established under subsection (a) or (b) of
section 320B of the Public Health Service Act.’’.
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SEC. 1303. ASTHMA, VISION, AND HEARING SCREENING AND
TREATMENT FOR CHILDREN ENROLLED IN
PUBLIC SCHOOLS.
Part B of title III of the Public Health Service Act
(42 U.S.C. 243 et seq.) is amended by adding at the end
the following:
‘‘SEC. 320B. ASTHMA, VISION, AND HEARING SCREENING
AND TREATMENT FOR CHILDREN ENROLLED
IN PUBLIC SCHOOLS.
‘‘(a) ASTHMA SCREENING AND CASE MANAGEMENT
PROGRAM.—
‘‘(1) IN GENERAL.—The Secretary, in collabo-
ration with the Secretary of Education, shall carry
out an asthma screening and case management pro-
gram under which local educational agencies shall be
reimbursed for the provision of asthma screening
and case management to children enrolled in public
elementary schools and secondary schools located in
areas with respect to which there is a high incidence
of childhood asthma.
‘‘(2) PROGRAM
ELEMENTS.—Under the pro-
gram, a local educational agency shall—
‘‘(A) determine whether a child enrolled in
a school described in paragraph (1) has received
an asthma screening test using a test that is
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appropriate for age and risk factors on the en-
rollment of the child in the school;
‘‘(B) in the case of a child who has not re-
ceived an asthma screening test, ensure that
the child receives such a test either by referral
or by performing the test (under contract or
otherwise); and
‘‘(C) in the case of a child determined to
have asthma, provide treatment or refer the
child for treatment (including case manage-
ment) and education in the management of
asthma.
‘‘(3) AUTHORIZATION
OF
APPROPRIATIONS.—
There is authorized to be appropriated to carry out
this subsection with respect to a child, and any data
reporting with respect to the child, who is not eligi-
ble for coverage under title XIX or XXI of the So-
cial Security Act, or is not otherwise covered under
a health insurance plan, $10,000,000 for each fiscal
year.
‘‘(b) VISION AND HEARING SCREENING PROGRAM.—
‘‘(1) IN GENERAL.—The Secretary shall carry
out a vision and hearing screening program under
which local educational agencies shall be reimbursed
for the provision of vision and hearing screening and
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corrective eyewear and hearing aids to children en-
rolled in public elementary schools and secondary
schools.
‘‘(2) PROGRAM
ELEMENTS.—Under the pro-
gram, a local educational agency shall—
‘‘(A) elect to provide vision and hearing
screening tests—
‘‘(i) to all children enrolled in a school
who are most likely to suffer from vision or
hearing loss; or
‘‘(ii) to all children enrolled in a
school;
‘‘(B) ensure that the category of children
elected under subparagraph (A) receive such
tests, either by referral or by performing the
test (under contract or otherwise), that are ap-
propriate for the age and risk factors of the
children, based on the enrollment of the chil-
dren in the school; and
‘‘(C) in the case of any child determined to
have a vision or hearing impairment, provide
the child with such eyewear and hearing aids as
are appropriate to correct the child’s vision or
hearing, to the extent that such correction is
feasible.
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‘‘(5) authority for officers or employees of the
Secretary to inspect any factory, warehouse, or other
establishment of any tobacco product manufacturer,
and to have access to records, files, papers, proc-
esses, controls and facilities related to tobacco prod-
uct manufacturing, in accordance with appropriate
authority and rules promulgated under this Act; and
‘‘(6) a requirement that the tobacco product
manufacturer maintain such files and records as the
Secretary may specify, as well as that the manufac-
turer report to the Secretary such information as
the Secretary shall require, in accordance with sec-
tion 519.
‘‘SEC. 578. PRESERVATION OF STATE AND LOCAL AUTHOR-
ITY.
‘‘Notwithstanding section 521 and except as other-
wise provided for in section 572(e), nothing in this sub-
chapter shall be construed as prohibiting a State or local-
ity from imposing requirements, prohibitions, penalties or
other measures to further the purposes of this subchapter
that are in addition to the requirements, prohibitions, or
penalties required under this subchapter. State and local
governments may impose additional tobacco product con-
trol measures to further restrict or limit the use of such
products.’’.
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poses of this section but only if the State has estab-
lished an income level under section 1902(l)(2)(A)(i)
for pregnant women that is at least 185 percent of
the income official poverty line described in such sec-
tion.
‘‘(c) 
REFERENCES
TO
TERMS
AND
SPECIAL
RULES.—In the case of, and with respect to, a State pro-
viding for coverage of FamilyCare assistance to targeted
low-income parents under subsection (a), the following
special rules apply:
‘‘(1) Any reference in this title (other than sub-
section (b)) to a targeted low-income child is deemed
to include a reference to a targeted low-income par-
ent.
‘‘(2) Any such reference to child health assist-
ance with respect to such parents is deemed a ref-
erence to FamilyCare assistance.
‘‘(3) In applying section 2103(e)(3)(B) in the
case of a family provided coverage under this sec-
tion, the limitation on total annual aggregate cost-
sharing shall be applied to the entire family.
‘‘(4) In applying section 2110(b)(4), any ref-
erence to ‘section 1902(l)(2) or 1905(n)(2) (as se-
lected by a State)’ is deemed a reference to the in-
come level applicable to parents under section 1931,