I
107TH CONGRESS
1ST SESSION
H. R. 600
To amend title XIX of the Social Security Act to provide families of disabled
children with the opportunity to purchase coverage under the Medicaid
Program for such children, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 13, 2001
Mr. SESSIONS (for himself, Mr. WAXMAN, Mr. UPTON, Mr. BARRETT, Mr.
BILIRAKIS, Mr. DINGELL, Mr. DREIER, Mr. BROWN of Ohio, Ms. PRYCE
of Ohio, Mr. STRICKLAND, Mrs. ROUKEMA, Mr. BALDACCI, Mr. ISAKSON,
Mr. DOGGETT, Mr. GILCHREST, Mr. MOORE, Mrs. MYRICK, Mr. OBER-
STAR, Mr. REYNOLDS, Mr. HINCHEY, Mr. DEFAZIO, Mr. KENNEDY of
Rhode Island, Mr. SANDERS, Ms. KAPTUR, Mrs. JOHNSON of Con-
necticut, Mr. TOWNS, Mr. STARK, Ms. ESHOO, Ms. BALDWIN, Mr.
GALLEGLY, Mr. ABERCROMBIE, Mr. SNYDER, Ms. SCHAKOWSKY, Mr.
SHIMKUS, Mr. SCOTT, Mr. PALLONE, Mr. STUPAK, Mr. MARKEY, Mr.
WYNN, Mrs. CAPPS, Mr. HALL of Ohio, Mr. KIND, Mr. MATSUI, Mr.
GEORGE MILLER of California, Mr. MORAN of Virginia, Mrs. MCCARTHY
of New York, Mr. PAYNE, Mr. UDALL of New Mexico, Mr. WATT of
North Carolina, Mr. ENGEL, Mr. NADLER, Ms. LEE, Ms. BERKLEY, Mr.
MURTHA, Mr. RUSH, Mrs. JONES of Ohio, Mr. KUCINICH, Mr. MCNUL-
TY, Ms. DEGETTE, Mr. BOUCHER, Mr. GREEN of Texas, Mr. BECERRA,
Mr. ALLEN, Ms. RIVERS, Mrs. LOWEY, Mr. SHAYS, Mr. WELDON of Flor-
ida, Mr. OXLEY, Mr. PICKERING, Mr. WHITFIELD, Mr. LAHOOD, Mr.
HAYWORTH, Mr. FLETCHER, Mr. SWEENEY, Mr. SHADEGG, Mr. TAUZIN,
Mr. GILMAN, Mr. NETHERCUTT, Mr. MORAN of Kansas, Mr. BRADY of
Texas, Mr. DEUTSCH, Ms. CAPITO, Mr. WELLER, Mr. SCHAFFER, Mr.
NUSSLE, and Mr. PAUL) introduced the following bill; which was referred
to the Committee on Energy and Commerce
A BILL
To amend title XIX of the Social Security Act to provide
families of disabled children with the opportunity to pur-
chase coverage under the Medicaid Program for such
children, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; AMENDMENTS TO SOCIAL SECU-
RITY ACT; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act 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
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.
(c) TABLE OF CONTENTS.—The table of contents of
this Act is as follows:
Sec. 1. Short title; amendments to Social Security Act; table of contents.
Sec. 2. Opportunity for families of disabled children to purchase medicaid cov-
erage for such children.
Sec. 3. Treatment of inpatient psychiatric hospital services for individuals
under age 21 in home or community-based services waivers.
Sec. 4. Demonstration of coverage under the medicaid program of children with
potentially severe disabilities.
Sec. 5. Development and support of family-to-family health information centers.
Sec. 6. Restoration of medicaid eligibility for certain SSI beneficiaries.
SEC. 2. OPPORTUNITY FOR FAMILIES OF DISABLED CHIL-
DREN TO PURCHASE MEDICAID COVERAGE
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:
‘‘(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
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
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
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
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.—
(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. 3. 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;
(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
(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. 4. DEMONSTRATION OF COVERAGE UNDER THE MED-
ICAID PROGRAM OF CHILDREN WITH POTEN-
TIALLY 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;
(B) has a physical or mental condition,
disease, disorder (including a congenital birth
defect or a metabolic condition), injury, or de-
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—
(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
(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.—
(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-
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. 5. DEVELOPMENT AND SUPPORT OF FAMILY-TO-FAM-
ILY 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-
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
‘‘(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. 6. RESTORATION OF MEDICAID ELIGIBILITY FOR CER-
TAIN 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
calendar quarter that begins after the date of enactment
of this Act.
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