‘‘(d) ACCESS TO RECORDS FOR IG AND GAO AUDITS 
AND EVALUATIONS.—For the purpose of evaluating and 
auditing the program established under this title, the Sec-
retary, the Office of Inspector General, and the Comp-
troller General shall have access to any books, accounts, 
records, correspondence, and other documents that are re-
lated to the expenditure of Federal funds under this title 
and that are in the possession, custody, or control of 
States receiving Federal funds under this title or political 
subdivisions thereof, or any grantee or contractor of such 
States or political subdivisions.’’. 
SEC. 155. REFERENCES TO TITLE XXI. 
Section 704 of the Medicare, Medicaid, and SCHIP 
Balanced Budget Refinement Act of 1999 (Appendix F, 
113 Stat. 1501A–321), as enacted into law by section 
1000(a)(6) of Public Law 106–113) is repealed. 
SEC. 156. RELIANCE ON LAW; EXCEPTION FOR STATE LEG-
ISLATION. 
(a) RELIANCE ON LAW.— With respect to amend-
ments made by this title or title VIII that become effective 
as of a date— 
(1) such amendments are effective as of such 
date whether or not regulations implementing such 
amendments have been issued; and 
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(2) Federal financial participation for medical 
assistance or child health assistance furnished under 
title XIX or XXI, respectively, of the Social Security 
Act on or after such date by a State in good faith 
reliance on such amendments before the date of pro-
mulgation of final regulations, if any, to carry out 
such amendments (or before the date of guidance, if 
any, regarding the implementation of such amend-
ments) shall not be denied on the basis of the 
State’s failure to comply with such regulations or 
guidance. 
(b) EXCEPTION FOR STATE LEGISLATION.—In the 
case of a State plan under title XIX or State child health 
plan under XXI of the Social Security Act, which the Sec-
retary of Health and Human Services determines requires 
State legislation in order for respective plan to meet one 
or more additional requirements imposed by amendments 
made by this title or title VIII, the respective State plan 
shall not be regarded as failing to comply with the require-
ments of such title solely on the basis of its failure to meet 
such an additional requirement before the first day of the 
first calendar quarter beginning after the close of the first 
regular session of the State legislature 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- 
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year legislative session, each year of the session shall be 
considered to be a separate regular session of the State 
legislature. 
TITLE II—MEDICARE 
BENEFICIARY IMPROVEMENTS 
Subtitle A—Improvements in 
Benefits 
SEC. 201. COVERAGE AND WAIVER OF COST-SHARING FOR 
PREVENTIVE SERVICES. 
(a) PREVENTIVE SERVICES DEFINED; COVERAGE OF 
ADDITIONAL PREVENTIVE SERVICES.—Section 1861 of 
the Social Security Act (42 U.S.C. 1395x) is amended— 
(1) in subsection (s)(2)— 
(A) in subparagraph (Z), by striking 
‘‘and’’ after the semicolon at the end; 
(B) in subparagraph (AA), by adding 
‘‘and’’ after the semicolon at the end; and 
(C) by adding at the end the following new 
subparagraph: 
‘‘(BB) additional pre-
ventive services (described in 
subsection 
(ccc)(1)(M));’’; 
and 
(2) by adding at the end the following new sub-
section: 
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100 
‘‘Preventive Services 
‘‘(ccc)(1) The term ‘preventive services’ means the 
following: 
‘‘(A) Prostate cancer screening tests (as 
defined in subsection (oo)). 
‘‘(B) Colorectal cancer screening tests (as 
defined in subsection (pp)). 
‘‘(C) Diabetes outpatient self-management 
training services (as defined in subsection (qq)). 
‘‘(D) Screening for glaucoma for certain 
individuals 
(as 
described 
in 
subsection 
(s)(2)(U)). 
‘‘(E) Medical nutrition therapy services for 
certain individuals (as described in subsection 
(s)(2)(V)). 
‘‘(F) An initial preventive physical exam-
ination (as defined in subsection (ww)). 
‘‘(G) Cardiovascular screening blood tests 
(as defined in subsection (xx)(1)). 
‘‘(H) Diabetes screening tests (as defined 
in subsection described in subsection (s)(2)(Y)). 
‘‘(I) Ultrasound screening for abdominal 
aortic aneurysm for certain individuals (as de-
scribed in described in subsection (s)(2)(AA)). 
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101 
‘‘(J) Pneumococcal and influenza vaccine 
and their administration (as described in sub-
section (s)(10)(A)). 
‘‘(K) Hepatitis B vaccine and its adminis-
tration for certain individuals (as described in 
subsection (s)(10)(B)). 
‘‘(L) Screening mammography (as defined 
in subsection (jj)). 
‘‘(M) Screening pap smear and screening 
pelvic exam (as described in subsection (s)(14)). 
‘‘(N) Bone mass measurement (as defined 
in subsection (rr)). 
‘‘(O) Additional preventive services (as de-
termined under paragraph (2)). 
‘‘(2)(A) The term ‘additional preventive serv-
ices’ means items and services, including mental 
health services, not described in subparagraphs (A) 
through (N) of paragraph (1) that the Secretary de-
termines to be reasonable and necessary for the pre-
vention or early detection of an illness or disability. 
‘‘(B) In making determinations under subpara-
graph (1), the Secretary shall— 
‘‘(C) take into account evidence-based rec-
ommendations by the United States Preventive 
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102 
Services Task Force and other appropriate or-
ganizations; and 
‘‘(D) use the process for making national 
coverage determinations (as defined in section 
1869(f)(1)(B)) under this title.’’. 
(b) PAYMENT
AND ELIMINATION
OF COST-SHAR-
ING.— 
(1) IN GENERAL.—Section 1833(a)(1) of the 
Social Security Act (42 U.S.C. 1395l(a)(1)) is 
amended— 
(A) in clause (T), by striking ‘‘80 percent’’ 
and inserting ‘‘100 percent’’; and 
(B) by striking ‘‘and’’ before ‘‘(V)’’; and 
(C) by inserting before the semicolon at 
the end the following: ‘‘, and (W) with respect 
to additional preventive services (as defined in 
section 1861(ccc)(2)) and other preventive serv-
ices for which a payment rate is not otherwise 
established under this section, the amount paid 
shall be 100 percent of the lesser of the actual 
charge for the services or the amount deter-
mined under a fee schedule established by the 
Secretary for purposes of this clause’’. 
(2) ELIMINATION
OF
COINSURANCE
IN
OUT-
PATIENT HOSPITAL SETTINGS.— 
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103 
(A) EXCLUSION FROM OPD FEE SCHED-
ULE.—Section 1833(t)(1)(B)(iv) of the Social 
Security Act (42 U.S.C. 1395l(t)(1)(B)(iv)) is 
amended by striking ‘‘screening mammography 
(as defined in section 1861(jj)) and diagnostic 
mammography’’ 
and 
inserting 
‘‘diagnostic 
mammography and preventive services (as de-
fined in section 1861(ccc)(1))’’. 
(B) CONFORMING AMENDMENTS.—Section 
1833(a)(2) of the Social Security Act (42 
U.S.C. 1395l(a)(2)) is amended— 
(i) in subparagraph (F), by striking 
‘‘and’’ after the semicolon at the end; 
(ii) in subparagraph (G)(ii), by adding 
‘‘and’’at the end; and 
(iii) by adding at the end the fol-
lowing new subparagraph: 
‘‘(H) with respect to additional preventive 
services (as defined in section 1861(ccc)(2)) 
furnished by an outpatient department of a hos-
pital, the amount determined under paragraph 
(1)(W);’’. 
(3) WAIVER OF APPLICATION OF DEDUCTIBLE 
FOR
ALL
PREVENTIVE
SERVICES.—The first sen-
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104 
tence of section 1833(b) of the Social Security Act 
(42 U.S.C. 1395l(b)) is amended — 
(A) in clause (1), by striking ‘‘items and 
services described in section 1861(s)(10)(A)’’ 
and inserting ‘‘preventive services (as defined in 
section 1861(ccc)(1))’’; 
(B) by inserting ‘‘and’’ before ‘‘(4)’’; and 
(C) by striking clauses (5) through (8). 
(c) INCLUSION AS PART OF INITIAL PREVENTIVE 
PHYSICAL EXAMINATION.—Section 1861(ww)(2) of the 
Social Security Act (42 U.S.C. 1395x(ww)(2)) is amended 
by adding at the end the following new subparagraph: 
‘‘(M) Additional preventive services (as de-
fined in subsection (ccc)(2)).’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to services furnished on or after 
January 1, 2008. 
SEC. 202. WAIVER OF DEDUCTIBLE FOR COLORECTAL CAN-
CER SCREENING TESTS REGARDLESS OF 
CODING, SUBSEQUENT DIAGNOSIS, OR ANCIL-
LARY TISSUE REMOVAL. 
(a) IN GENERAL.—Section 1833(b)(8) of the Social 
Security Act (42 U.S.C. 1395l(b)(8)) is amended by in-
serting ‘‘, regardless of the code applied, of the establish-
ment of a diagnosis as a result of the test, or of the re-
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105 
moval of tissue or other matter or other procedure that 
is performed in connection with and as a result of the 
screening test’’ after ‘‘1861(pp)(1))’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to items and services furnished 
on or after January 1, 2008. 
SEC. 203. PARITY FOR MENTAL HEALTH COINSURANCE. 
Section 1833(c) of the Social Security Act (42 U.S.C. 
1395l(c)) is amended— 
(1) in the first sentence, by striking ‘‘62–1/2 
percent’’ and inserting ‘‘the incurred expense per-
centage (as specified in the last sentence)’’; and 
(2) by adding at the end the following: ‘‘For 
purposes of this subsection, the ‘incurred expense 
percentage’ is equal to 62–1/2 percent increased, for 
each year beginning with 2008, by 6–1/4 percentage 
points, but not to exceed 100 percent.’’. 
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106 
Subtitle B—Improving, Clarifying, 
and Simplifying Financial As-
sistance for Low Income Medi-
care Beneficiaries 
SEC. 211. IMPROVING ASSETS TESTS FOR MEDICARE SAV-
INGS PROGRAM AND LOW-INCOME SUBSIDY 
PROGRAM. 
(a) APPLICATION OF HIGHEST LEVEL PERMITTED 
UNDER LIS.— 
(1) TO FULL-PREMIUM SUBSIDY ELIGIBLE INDI-
VIDUALS.—Section 1860D–14(a) of the Social Secu-
rity Act (42 U.S.C. 1395w–114(a)) is amended— 
(A) in paragraph (1), in the matter before 
subparagraph (A), by inserting ‘‘(or, beginning 
with 2009, paragraph (3)(E))’’ after ‘‘para-
graph (3)(D)’’; and 
(B) in paragraph (3)(A)(iii), by striking 
‘‘(D) or’’. 
(2) ANNUAL
INCREASE
IN
LIS
RESOURCE 
TEST.—Section 1860D–14(a)(3)(E)(i) of such Act 
(42 U.S.C. 1395w–114(a)(3)(E)(i)) is amended— 
(A) by striking ‘‘and’’ at the end of sub-
clause (I); 
(B) in subclause (II), by inserting ‘‘(before 
2009)’’ after ‘‘subsequent year’’; 
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107 
(C) by striking the period at the end of 
subclause (II) and inserting a semicolon; and 
(D) by inserting after subclause (II) the 
following new subclauses: 
‘‘(III) for 2009, $17,000 (or 
$34,000 in the case of the combined 
value of the individual’s assets or re-
sources and the assets or resources of 
the individual’s spouse); and 
‘‘(IV) for a subsequent year, the 
dollar amounts specified in this sub-
clause (or subclause (III)) for the pre-
vious year increased by $1,000 (or 
$2,000 in the case of the combined 
value referred to in subclause (III)).’’. 
(3) APPLICATION OF LIS TEST UNDER MEDI-
CARE SAVINGS PROGRAM.—Section 1905(p)(1)(C) of 
such Act (42 U.S.C. 1396d(p)(1)(C)) is amended by 
inserting before the period at the end the following: 
‘‘or, effective beginning with January 1, 2009, whose 
resources (as so determined) do not exceed the max-
imum resource level applied for the year under sec-
tion 1860D–14(a)(3)(E) applicable to an individual 
or to the individual and the individual’s spouse (as 
the case may be)’’. 
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108 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to eligibility determinations for 
income-related subsidies and medicare cost-sharing fur-
nished for periods beginning on or after January 1, 2009. 
SEC. 212. MAKING QI PROGRAM PERMANENT AND EXPAND-
ING ELIGIBILITY. 
(a) MAKING PROGRAM PERMANENT.— 
(1) IN GENERAL.—Section 1902(a)(10)(E)(iv) 
of 
the 
Social 
Security 
Act 
(42 
U.S.C. 
1396b(a)(10)(E)(iv)) is amended— 
(A) by striking ‘‘sections 1933 and’’ and 
by inserting ‘‘section’’; and 
(B) by striking ‘‘(but only with’’ and all 
that follows through ‘‘September 2007)’’. 
(2) ELIMINATION OF FUNDING LIMITATION.— 
(A) IN GENERAL.—Section 1933 of such 
Act (42 U.S.C. 1396u–3) is amended— 
(i) in subsection (a), by striking ‘‘who 
are selected to receive such assistance 
under subsection (b)’’ 
(ii) by striking subsections (b), (c), 
(e), and (g); 
(iii) in subsection (d), by striking 
‘‘furnished in a State’’ and all that follows 
and inserting ‘‘the Federal medical assist-
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109 
ance percentage shall be equal to 100 per-
cent.’’; and 
(iv) by redesignating subsections (d) 
and (f) as subsections (b) and (c), respec-
tively. 
(B) CONFORMING
AMENDMENT.—Section 
1905(b) of such Act (42 U.S.C. 1396d(b)) is 
amended by striking ‘‘1933(d)’’ and inserting 
‘‘1933(b)’’. 
(C) EFFECTIVE DATE.—The amendments 
made by subparagraph (A) shall take effect on 
October 1, 2007. 
(b) INCREASE IN ELIGIBILITY TO 150 PERCENT OF 
THE
FEDERAL
POVERTY
LEVEL.—Section 
1902(a)(10)(E)(iv) of such Act is further amended by in-
serting ‘‘(or, effective January 1, 2008, 150 percent)’’ 
after ‘‘135 percent’’. 
SEC. 213. ELIMINATING BARRIERS TO ENROLLMENT. 
(a) ADMINISTRATIVE VERIFICATION OF INCOME AND 
RESOURCES UNDER THE LOW-INCOME SUBSIDY PRO-
GRAM.—Section 1860D–14(a)(3) of the Social Security 
Act (42 U.S.C. 1395w–114(a)(3)) is amended by adding 
at the end the following new subparagraph: 
‘‘(G) SELF-CERTIFICATION
OF
INCOME 
AND
RESOURCES.—For purposes of applying 
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110 
this section, an individual shall be permitted to 
qualify on the basis of self-certification of in-
come and resources without the need to provide 
additional documentation.’’. 
(b) AUTOMATIC REENROLLMENT WITHOUT NEED TO 
REAPPLY UNDER LOW-INCOME SUBSIDY PROGRAM.— 
Section 1860D–14(a)(3) of such Act (42 U.S.C. 1395w– 
114(a)(3)), as amended by subsection (a), is further 
amended by adding at the end the following new subpara-
graph: 
‘‘(H) AUTOMATIC
REENROLLMENT.—For 
purposes of applying this section, in the case of 
an individual who has been determined to be a 
subsidy eligible individual (and within a par-
ticular class of such individuals, such as a full- 
subsidy eligible individual or a partial subsidy 
eligible individual), the individual shall be 
deemed to continue to be so determined without 
the need for any annual or periodic application 
unless and until the individual notifies a Fed-
eral or State official responsible for such deter-
minations that the individual’s eligibility condi-
tions have changed so that the individual is no 
longer a subsidy eligible individual (or is no 
longer within such class of such individuals).’’. 
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111 
(c) ENCOURAGING APPLICATION
OF PROCEDURES 
UNDER MEDICARE SAVINGS PROGRAM.—Section 1905(p) 
of such Act (42 U.S.C. 1396d(p)) is amended by adding 
at the end the following new paragraph: 
‘‘(7) The Secretary shall take all reasonable 
steps to encourage States to provide for administra-
tive verification of income and automatic reenroll-
ment (as provided under clauses (iii) and (iv) of sec-
tion 1860D–14(a)(3)(C) in the case of the low-in-
come subsidy program).’’. 
(d) SSA ASSISTANCE WITH MEDICARE SAVINGS 
PROGRAM AND LOW-INCOME SUBSIDY PROGRAM APPLI-
CATIONS.—Section 1144 of such Act (42 U.S.C. 1320b– 
14) is amended by adding at the end the following new 
subsection: 
‘‘(c) ASSISTANCE WITH MEDICARE SAVINGS PRO-
GRAM AND LOW-INCOME SUBSIDY PROGRAM APPLICA-
TIONS.— 
‘‘(1) DISTRIBUTION OF APPLICATIONS TO AP-
PLICANTS FOR MEDICARE.—In the case of each indi-
vidual applying for hospital insurance benefits under 
section 226 or 226A, the Commissioner shall provide 
the following: 
‘‘(A) Information describing the low-in-
come subsidy program under section 1860D–14 
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112 
and the medicare savings program under title 
XIX. 
‘‘(B) An application for enrollment under 
such low-income subsidy program as well as an 
application form (developed under section 
1905(p)(5)) for medical assistance for medicare 
cost-sharing under title XIX. 
‘‘(C) Information on how the individual 
may obtain assistance in completing such appli-
cations, including information on how the indi-
vidual may contact the State health insurance 
assistance program (SHIP) for the State in 
which the individual is located. 
The Commissioner shall make such application 
forms available at local offices of the Social Security 
Administration. 
‘‘(2) TRAINING
PERSONNEL
IN
ASSISTING
IN 
COMPLETING
APPLICATIONS.—The 
Commissioner 
shall provide training to those employees of the So-
cial Security Administration who are involved in re-
ceiving applications for benefits described in para-
graph (1) in assisting applicants in completing a 
medicare savings program application described in 
paragraph (1). Such employees who are so trained 
shall provide such assistance upon request. 
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113 
‘‘(3) TRANSMITTAL
OF
COMPLETED
APPLICA-
TION.—If such an employee assists in completing 
such an application, the employee, with the consent 
of the applicant, shall transmit the completed appli-
cation to the appropriate State medicaid agency for 
processing. 
‘‘(4) COORDINATION
WITH
OUTREACH.—The 
Commissioner shall coordinate outreach activities 
under this subsection with outreach activities con-
ducted by States in connection with the low-income 
subsidy program and the medicare savings pro-
gram.’’. 
(e) MEDICAID AGENCY CONSIDERATION OF APPLICA-
TIONS.—Section 1935(a) of such Act (42 U.S.C. 1396u– 
5(a)) is amended by adding at the end the following new 
paragraph: 
‘‘(4) CONSIDERATION OF MSP APPLICATIONS.— 
The State shall accept medicare savings program ap-
plications transmitted under section 1144(c)(3) and 
act on such applications in the same manner and 
deadlines as if they had been submitted directly by 
the applicant.’’. 
(f) 
TRANSLATION
OF
MODEL
FORM.—Section 
1905(p)(5)(A) of the Social Security Act (42 U.S.C. 
1396d(p)(5)(A)) is amended by adding at the end the fol-
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114 
lowing: ‘‘The Secretary shall provide for the translation 
of such application form into at least the 10 languages 
(other than English) that are most often used by individ-
uals applying for hospital insurance benefits under section 
226 or 226A and shall make the translated forms available 
to the States and to the Commissioner of Social Secu-
rity.’’. 
(g) DISCLOSURE OF TAX RETURN INFORMATION FOR 
PURPOSES
OF
PROVIDING
LOW-INCOME
SUBSIDIES 
UNDER MEDICARE.— 
(1) IN
GENERAL.—Subsection (l) of section 
6103 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new 
paragraph: 
‘‘(21) DISCLOSURE OF RETURN INFORMATION 
FOR
PURPOSES
OF
PROVIDING
LOW-INCOME
SUB-
SIDIES UNDER MEDICARE.— 
‘‘(A) RETURN INFORMATION FROM INTER-
NAL REVENUE SERVICE TO SOCIAL SECURITY 
ADMINISTRATION.—The Secretary, upon writ-
ten request from the Commissioner of Social 
Security, shall disclose to the officers and em-
ployees of the Social Security Administration 
with respect to any individual identified by the 
Commissioner as potentially eligible (based on 
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115 
information other than return information) for 
low-income subsidies under section 1860D–14 
of the Social Security Act— 
‘‘(i) whether the adjusted gross in-
come for the applicable year is less than 
135 percent of the poverty line (as speci-
fied by the Commissioner in such request), 
‘‘(ii) whether such adjusted gross in-
come is between 135 percent and 150 per-
cent of the poverty line (as so specified), 
‘‘(iii) whether any designated distribu-
tions (as defined in section 3405(e)(1)) 
were reported with respect to such indi-
vidual under section 6047(d) for the appli-
cable year, and the amount (if any) of the 
distributions so reported, 
‘‘(iv) whether the return was a joint 
return for the applicable year, and 
‘‘(v) the applicable year. 
‘‘(B) APPLICABLE YEAR.— 
‘‘(i) IN GENERAL.—For the purposes 
of this paragraph, the term ‘applicable 
year’ means the most recent taxable year 
for which information is available in the 
Internal Revenue Service’s taxpayer data 
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116 
information systems, or, if there is no re-
turn filed for the individual for such year, 
the prior taxable year. 
‘‘(ii) NO
RETURN.—If no return is 
filed for such individual for both taxable 
years referred to in clause (i), the Sec-
retary shall disclose the fact that there is 
no return filed for such individual for the 
applicable year in lieu of the information 
described in subparagraph (A). 
‘‘(C) RESTRICTION ON USE OF DISCLOSED 
INFORMATION.—Return information disclosed 
under this paragraph may be used only for the 
purpose of improving the efforts of the Social 
Security Administration to contact and assist 
eligible individuals for, and administering, low- 
income subsidies under section 1860D–14 of 
the Social Security Act. 
‘‘(D) TERMINATION.—No disclosure shall 
be made under this paragraph after the 2-year 
period beginning on the date of the enactment 
of this paragraph.’’. 
(2) PROCEDURES
AND
RECORDKEEPING
RE-
LATED TO DISCLOSURES.—Paragraph (4) of section 
6103(p) of such Code is amended by striking ‘‘or 
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117 
(17)’’ each place it appears and inserting ‘‘(17), or 
(21)’’. 
(3) REPORT.—Not later than 18 months after 
the date of the enactment of this Act, the Secretary 
of the Treasury, after consultation with the Commis-
sioner of Social Security, shall submit a written re-
port to Congress regarding the use of disclosures 
made under section 6103(l)(21) of the Internal Rev-
enue Code of 1986, as added by this subsection, in 
identifying individuals eligible for the low-income 
subsidies under section 1860D–14 of the Social Se-
curity Act. 
(4) EFFECTIVE DATE.—The amendment made 
by this subsection shall apply to disclosures made 
after the date of the enactment of this Act. 
(h) EFFECTIVE DATE.—Except as otherwise pro-
vided, the amendments made by this section shall take ef-
fect on January 1, 2009. 
SEC. 214. ELIMINATING APPLICATION OF ESTATE RECOV-
ERY. 
(a) IN GENERAL.—Section 1917(b)(1)(B)(ii) of the 
Social Security Act (42 U.S.C. 1396p(b)(1)(B)(ii)) is 
amended by inserting ‘‘(but not including medical assist-
ance for medicare cost-sharing or for benefits described 
in section 1902(a)(10)(E))’’ before the period at the end. 
VerDate Aug 31 2005 
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