I 
109TH CONGRESS 
2D SESSION 
H. R. 5834 
To amend title XIX of the Social Security Act to improve requirements 
under the Medicaid Program for items and services furnished in or 
through an educational program or setting to children, including children 
with developmental, physical, or mental health needs, and for other 
purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 19, 2006 
Mr. DINGELL (for himself, Mr. WHITFIELD, Mr. GEORGE MILLER of Cali-
fornia, Mr. WAXMAN, Mr. MARKEY, Mrs. CAPPS, Mr. RUSH, Mr. TOWNS, 
Ms. SCHAKOWSKY, Mr. DAVIS of Florida, Ms. BALDWIN, Mr. PALLONE, 
Mr. ROSS, Mr. GENE GREEN of Texas, Mr. ENGEL, Mr. STUPAK, Mr. 
WYNN, Ms. DEGETTE, Mr. ALLEN, Ms. SOLIS, Mr. GONZALEZ, Mr. 
STRICKLAND, Mr. DOYLE, Mr. KILDEE, Mr. GRIJALVA, Mr. DAVIS of Illi-
nois, Mr. HINOJOSA, Mr. PAYNE, Ms. LEE, Mr. FILNER, Ms. ZOE 
LOFGREN of California, Ms. WOOLSEY, and Mr. CARDIN) introduced the 
following bill; which was referred to the Committee on Energy and Com-
merce 
A BILL 
To amend title XIX of the Social Security Act to improve 
requirements under the Medicaid Program for items and 
services furnished in or through an educational program 
or setting to children, including children with develop-
mental, physical, or mental health needs, and for other 
purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
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SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Protecting Children’s 
Health in Schools Act of 2006’’. 
SEC. 2. REQUIREMENTS UNDER THE MEDICAID PROGRAM 
FOR ITEMS AND SERVICES FURNISHED IN OR 
THROUGH AN EDUCATIONAL PROGRAM OR 
SETTING TO CHILDREN, INCLUDING CHIL-
DREN WITH DEVELOPMENTAL, PHYSICAL, OR 
MENTAL HEALTH NEEDS. 
(a) REQUIREMENTS FOR PAYMENTS.—Section 1903 
of the Social Security Act (42 U.S.C. 1396b) is amend-
ed— 
(1) in subsection (i)— 
(A) in paragraph (22), by striking the pe-
riod at the end and inserting ‘‘; or’’; and 
(B) by inserting after paragraph (22), the 
following new paragraphs: 
‘‘(23) with respect to any amount expended by, 
or on behalf of, the State (including by a local edu-
cational agency in the State or the lead agency in 
the State with responsibility for administering part 
C of the Individuals with Disabilities Education Act) 
for an item or service provided under the State plan 
in or through an educational program or setting, or 
for any administrative cost incurred to carry out the 
State plan in or through such a program or setting, 
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or for a transportation service for an individual who 
has not attained age 21, unless the requirements of 
subsection (y) are met; or 
‘‘(24) with respect to any amount expended for 
an item or service provided under the State plan in 
or through an educational program or setting, or for 
any administrative cost incurred to carry out the 
plan in or through such a program or setting by, or 
on behalf of, the State through an agency that is not 
the State agency with responsibility for admin-
istering the State plan (including a local educational 
agency in the State or the lead agency in the State 
with responsibility for administering part C of the 
Individuals with Disabilities Education Act) and 
that enters into a contract or other arrangement 
with a person or entity for or in connection with the 
collection or submission of claims for such an ex-
penditure or cost, unless the agency— 
‘‘(A) if not a public agency operating a 
consortium with other public agencies, uses a 
competitive bidding process or otherwise to con-
tract with such person or entity at a reasonable 
rate commensurate with the services performed 
by the person or entity; and 
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‘‘(B) requires that any fees (including any 
administrative fees) to be paid to the person or 
entity for the collection or submission of such 
claims are identified as a non-contingent, speci-
fied dollar amount in the contract.’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(y) REQUIREMENTS FOR FEDERAL FINANCIAL PAR-
TICIPATION FOR FURNISHING MEDICAL ASSISTANCE (IN-
CLUDING MEDICALLY NEEDED TRANSPORTATION) IN OR 
THROUGH AN EDUCATIONAL PROGRAM OR SETTING.— 
For purposes of subsection (i)(23), the requirements of 
this subsection are the following: 
‘‘(1) APPROVED METHODOLOGY FOR EXPENDI-
TURES FOR BUNDLED ITEMS, SERVICES, AND AD-
MINISTRATIVE COSTS.— 
‘‘(A) IN
GENERAL.—In the case of any 
amount expended by, or on behalf of, the State 
for a bundle of individual items, services, and 
administrative costs under the State plan that 
are furnished in or through an educational pro-
gram or setting, the expenditure must be made 
in accordance with a methodology approved by 
the Secretary which— 
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‘‘(i) provides for an itemization to the 
Secretary in a manner that ensures ac-
countability of the cost of the bundled 
items, services, and administrative costs 
and includes payment rates and the meth-
odologies underlying the establishment of 
such rates; 
‘‘(ii) has a sound basis for deter-
mining such payment rates and methodolo-
gies; and 
‘‘(iii) matches payments for the bun-
dled items, services, and administrative 
costs with corresponding items and services 
provided and administrative costs incurred 
under the State plan. 
‘‘(B) RULE OF CONSTRUCTION.—Nothing 
in subparagraph (A) shall be construed as— 
‘‘(i) requiring a State to establish and 
apply such a methodology through a State 
plan amendment; 
‘‘(ii) requiring a State with such an 
approved methodology to obtain the ap-
proval of the Secretary for any increase in 
rates of reimbursement that are estab-
lished consistent with such methodology; or 
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‘‘(iii) prohibiting the Secretary from 
reviewing a State’s costs for the individual 
items, services, and administrative costs 
that make up a proposed bundle of items, 
services, and costs as a condition of ap-
proval of the methodology that the State 
will establish to determine the rate of reim-
bursement for such bundle of items, serv-
ices, and costs. 
‘‘(2) APPLICATION OF MARKET RATE FOR INDI-
VIDUAL
ITEMS, 
SERVICES, 
ADMINISTRATIVE 
COSTS.—In the case of an amount expended by, or 
on behalf of, the State for an individual item, serv-
ice, or administrative cost under the State plan that 
is furnished in or through an educational program 
or setting, the State must establish that the amount 
expended— 
‘‘(A) does not exceed the amount that 
would have been paid for the item, service, or 
administrative cost if the item or service was 
provided or the cost was incurred by an entity 
in or through a program or setting other than 
an educational program or setting; or 
‘‘(B) if the amount expended for the item, 
service, or administrative cost is higher than 
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