825
‘‘(ii) the lesser of (I) the spousal
share computed under subsection (c)(1), or
(II) $60,000 (subject to adjustment under
subsection (g)),
‘‘(iii) the amount established under
subsection (e)(2), or
‘‘(iv) the amount transferred under a
court order under paragraph (3);
exceeds
‘‘(B) the amount of the resources other-
wise available to the community spouse (deter-
mined without regard to such an allowance).
‘‘(3) TRANSFERS UNDER COURT ORDERS.—If a
court has entered an order against an institutional-
ized spouse for the support of the community
spouse, any provisions under the plan relating to
transfers or disposals of assets for less than fair
market value shall not apply to amounts of resources
transferred pursuant to such order for the support
of the spouse or a family member (as defined in sub-
section (d)(1)).
‘‘(g) INDEXING DOLLAR AMOUNTS.—For services
furnished during a calendar year after 1989, the dollar
amounts specified in subsections (d)(3)(C), (f)(2)(A)(i),
and (f)(2)(A)(ii)(II) shall be increased by the same per-
826
centage as the percentage increase in the consumer price
index for all urban consumers (all items; U.S. city aver-
age) between September 1988 and the September before
the calendar year involved.
‘‘(h) DEFINITIONS.—In this section:
‘‘(1) INSTITUTIONALIZED
SPOUSE.—The term
‘institutionalized spouse’ means an individual—
‘‘(A)(i) who is in a medical institution or
nursing facility, or
‘‘(ii) at the option of the State (I) who
would be eligible under the State plan under
this title if such individual was in a medical in-
stitution, (II) with respect to whom there has
been a determination that but for the provision
of home or community-based services such indi-
vidual would require the level of care provided
in a hospital, nursing facility or intermediate
care facility for the mentally retarded the cost
of which could be reimbursed under the plan,
and (III) who will receive home or community-
based services pursuant the plan; and
‘‘(B) is married to a spouse who is not in
a medical institution or nursing facility;
827
but does not include any such individual who is not
likely to meet the requirements of subparagraph (A)
for at least 30 consecutive days.
‘‘(2) COMMUNITY SPOUSE.—The term ‘commu-
nity spouse’ means the spouse of an institutionalized
spouse.
‘‘SEC. 1506. PREVENTING FAMILY IMPOVERISHMENT.
‘‘(a) RESPONSIBILITIES FOR LONG-TERM CARE GEN-
ERALLY.—A State plan may not—
‘‘(1) require an adult child or any other individ-
ual (other than the applicant or recipient of services
or the spouse of such an applicant or recipient) to
contribute to the cost of covered nursing facility
services and other long-term care services under the
plan; and
‘‘(2) take into account with respect to such
services the financial responsibility of any individual
for any applicant or recipient of assistance under the
plan unless such applicant or recipient is such indi-
vidual’s spouse or such individual’s child who is
under age 21 or (with respect to States eligible to
participate in the State program established under
title XVI), is blind or permanently and totally dis-
abled, or is blind or disabled as defined in section
828
1614 (with respect to States which are not eligible
to participate in such program).
‘‘(b) LIMITATIONS ON LIENS.—
‘‘(1) IN GENERAL.—No lien may be imposed
against the property of any individual prior to the
individual’s death on account of medical assistance
paid or to be paid on the individual’s behalf under
a State plan, except—
‘‘(A) pursuant to the judgment of a court
on account of benefits incorrectly paid on behalf
of such individual; or
‘‘(B) in the case of the real property of an
individual—
‘‘(i) who is an inpatient in a nursing
facility, intermediate care facility for the
mentally retarded, or other medical institu-
tion, if such individual is required, as a
condition of receiving services in such insti-
tution under the plan, to spend for costs of
medical care all but a minimal amount of
the individual’s income required for per-
sonal needs, and
‘‘(ii) with respect to whom the State
determines, after notice and opportunity
for a hearing (in accordance with proce-
829
dures established by the State), that the
individual cannot reasonably be expected to
be discharged from the medical institution
and to return home,
except as provided in paragraph (2).
‘‘(2) EXCEPTION.—No lien may be imposed
under paragraph (1)(B) on such individual’s home
if—
‘‘(A) the spouse of such individual,
‘‘(B) such individual’s child who is under
age 21, or (with respect to States eligible to
participate in the State program established
under title XVI) is blind or permanently and to-
tally disabled, or (with respect to States which
are not eligible to participate in such program)
is blind or disabled as defined in section 1614,
or
‘‘(C) a sibling of such individual (who has
an equity interest in such home and who was
residing in such individual’s home for a period
of at least one year immediately before the date
of the individual’s admission to the medical in-
stitution),
is lawfully residing in such home.
830
‘‘(3) DISSOLUTION UPON RETURN HOME.—Any
lien imposed with respect to an individual pursuant
to paragraph (1)(B) shall dissolve upon that individ-
ual’s discharge from the medical institution and re-
turn home.
‘‘SEC. 1507. STATE FLEXIBILITY.
‘‘(a) STATE FLEXIBILITY IN BENEFITS, PROVIDER
PAYMENTS, GEOGRAPHICAL COVERAGE AREA, AND SE-
LECTION OF PROVIDERS.—The State under its State plan
may—
‘‘(1) specify those items and services for which
medical assistance is provided (consistent with guar-
antees under subsections (a) and (b) of section
1501), the providers which may provide such items
and services, and the amount and frequency of pro-
viding such items and services (consistent with the
requirements of section 1502(d));
‘‘(2) specify the extent to which the same medi-
cal assistance will be provided in all geographical
areas or political subdivisions of the State, so long
as medical assistance is made available in all such
areas or subdivisions;
‘‘(3) specify the extent to which the medical as-
sistance made available to any individual eligible for
medical assistance is comparable in amount, dura-
831
tion, or scope to the medical assistance made avail-
able to any other such individual; and
‘‘(4) specify the extent to which an individual
eligible for medical assistance with respect to an
item or service may choose to obtain such assistance
from any institution, agency, or person qualified to
provide the item or service.
‘‘(b) STATE FLEXIBILITY WITH RESPECT TO MAN-
AGED CARE.—Nothing in this title shall be construed—
‘‘(1) to limit a State’s ability to contract with,
on a capitated basis or otherwise, health care plans
or individual health care providers for the provision
or arrangement of medical assistance,
‘‘(2) to limit a State’s ability to contract with
health care plans or other entities for case manage-
ment services or for coordination of medical assist-
ance, or
‘‘(3) to restrict a State from establishing capi-
tation rates on the basis of competition among
health care plans or negotiations between the State
and one or more health care plans.
‘‘SEC. 1508. PRIVATE RIGHTS OF ACTION.
‘‘(a) LIMITATION
ON FEDERAL CAUSES
OF AC-
TION.—Except as provided in this section, no person or
entity may bring an action against a State in Federal
832
court based on its failure to comply with any requirement
of this title.
‘‘(b) STATE CAUSES OF ACTION.—
‘‘(1) ADMINISTRATIVE PROCEDURES.—A State
plan shall provide for—
‘‘(A) an administrative procedure whereby
an individual alleging a denial of benefits under
the State plan may receive a hearing regarding
such denial, and
‘‘(B) judicial review, through a private
right of action in a State court by an individual
or class of individuals, regarding such a denial,
but a State may require exhaustion of adminis-
trative remedies before such an action may be
taken.
‘‘(2) WRIT OF CERTIORARI.—An individual or
class may file a petition for certiorari before the Su-
preme Court of the United States in a case of a de-
nial of benefits under the State plan to review a de-
termination of the highest court of a State regarding
such denial.
(3) CONSTRUCTION.—Nothing in this sub-
section shall be construed as requiring a State to
provide a private right of action in State court by
833
a provider, health plan, or a class of providers or
health plans.
‘‘(c) SECRETARIAL RELIEF.—
‘‘(1) IN GENERAL.—The Secretary may bring
an action in Federal court against a State and on
behalf of an individual or class of individuals in
order to assure that a State provides benefits to in-
dividuals and classes of individuals as guaranteed
under subsection (a) or (b) of section 1501 under its
State plan.
‘‘(2) NO PRIVATE RIGHT.—No action may be
brought in any court against the Secretary based on
the Secretary’s bringing, or failure to bring, an ac-
tion under paragraph (1).
‘‘(3) CONSTRUCTION.—Nothing in this title
shall be construed as authorizing the Secretary to
bring an action on behalf of a provider, health plan,
or a class of providers or health plans.
‘‘Part B——Payments to States
‘‘SEC. 1511. ALLOTMENT OF FUNDS AMONG STATES.
‘‘(a) ALLOTMENTS.—
‘‘(1) COMPUTATION.—The Secretary shall pro-
vide for the computation of State obligation and out-
lay allotments in accordance with this section for
each fiscal year beginning with fiscal year 1997.
834
Nothing in this part shall be construed as authoriz-
ing payment under this part to any State for fiscal
year 1996.
‘‘(2) LIMITATION ON OBLIGATIONS.—
‘‘(A) IN
GENERAL.—Subject to the suc-
ceeding provisions of this paragraph, the Sec-
retary shall not enter into obligations with any
State under this title for a fiscal year in excess
of the sum of the following allotments for the
State for the fiscal year:
‘‘(i) 
BASE
OBLIGATION
ALLOT-
MENT.—The amount of the base obligation
allotment for that State for the fiscal year
under paragraph (4).
‘‘(ii) 
SUPPLEMENTAL
ALLOTMENT
FOR
CERTAIN
ALIENS.—The amount of
any supplemental allotment for that State
for the fiscal year under subsection (f).
‘‘(iii) SUPPLEMENTAL
PER
BENE-
FICIARY
UMBRELLA
ALLOTMENT.—The
amount of any supplemental per bene-
ficiary umbrella allotment for that State
for the fiscal year under subsection (g).
‘‘(iv) 
SUPPLEMENTAL
ALLOTMENT
FOR
INDIAN
HEALTH
SERVICES.—The
835
amount of any supplemental allotment for
that State for the fiscal year under sub-
section (h).
The sum of the base obligation allotments for all
States in any fiscal year (excluding amounts carried
over under subparagraph (B) and excluding changes
in allotments effected under paragraph (4)(D)) shall
not exceed the aggregate limit on new base obliga-
tion authority specified in paragraph (3) for that fis-
cal year.
‘‘(B) ADJUSTMENTS.—
‘‘(i) CARRYOVER OF BASE ALLOTMENT
PERMITTED.—Subject to clauses (ii), if the
amount of obligations entered into under
this part with a State for quarters in a fis-
cal year is less than the amount of the ob-
ligation allotment under this section to the
State for the fiscal year, the amount of the
difference (less any amount computed
under clause (iii)) shall be added to the
amount of the State obligation allotment
otherwise provided under this section for
the succeeding fiscal year.
‘‘(ii) NO CARRYOVER PERMITTED FOR
STATES
RECEIVING
SUPPLEMENTAL
UM-
836
BRELLA
ALLOTMENTS.—Clause (i) shall
not apply, insofar as it permits a carryover
for a State from a particular year to the
next year, if in the particular year the
State receives a supplemental umbrella al-
lotment under subsection (g).
‘‘(iii) NO CARRYOVER OF ALIEN AND
INDIAN
SUPPLEMENTAL
ALLOTMENTS.—
The amount of any carryover under clause
(i) from a fiscal year shall be reduced by
the amount (if any) by which the amount
of the outlays for expenditures described in
subsection (f) or (h) for the fiscal year is
less than the amount of any supplemental
allotment provided under the respective
subsection for the State and fiscal year in-
volved.
‘‘(C) REDUCTION FOR NEW OBLIGATIONS
UNDER TITLE XIX IN FISCAL YEAR 1997.—The
amount of the base obligation allotment other-
wise provided under this section for fiscal year
1997 for a State shall be reduced by the
amount of the obligations entered into with re-
spect to the State under section 1903(a) during
such fiscal year.
837
‘‘(D) NO EFFECT ON PRIOR YEAR OBLIGA-
TIONS.—Subparagraph (A) shall not apply to or
affect obligations for a fiscal year prior to fiscal
year 1997.
‘‘(E) OBLIGATION.—For purposes of this
section, the Secretary’s establishment of an es-
timate under section 1512(b) of the amount a
State is entitled to receive for a quarter (taking
into account any adjustments described in such
subsection) beginning during or after fiscal year
1997 shall be treated as the obligation of such
amount for the State as of the first day of the
quarter.
‘‘(F) RELATION
TO
GUARANTEES.—The
Federal Government’s obligations for payments
under this title are limited as provided under
subparagraph (A) and are only subject to ad-
justment based on any guarantee provided
under section 1501 as provided under sub-
section (g).
‘‘(3) AGGREGATE LIMIT ON NEW BASE OBLIGA-
TION AUTHORITY.—
‘‘(A) IN GENERAL.—For purposes of this
subsection, subject to subparagraph (C), the
‘aggregate limit on new base obligation author-
838
ity’, for a fiscal year, is the base pool amount
under subsection (b) for the fiscal year, divided
by the payout adjustment factor (described in
subparagraph (B)) for the fiscal year.
‘‘(B) PAYOUT ADJUSTMENT FACTOR.—For
purposes of this subsection, the ‘payout adjust-
ment factor’—
‘‘(i) for fiscal year 1997 is 0.950,
‘‘(ii) for fiscal year 1998 is 0.986, and
‘‘(iii) for a subsequent fiscal year is
0.998.
‘‘(C) TRANSITIONAL
ADJUSTMENT
FOR
PRE-FISCAL YEAR 1997-OBLIGATION OUTLAYS.—
In order to account for pre-fiscal year 1997-ob-
ligation 
outlays 
described 
in 
paragraph
(4)(C)(iv), in determining the aggregate limit
on new obligation authority under subpara-
graph (A) for fiscal year 1997, the pool amount
for such fiscal year is equal to—
‘‘(i) the pool amount for such year,
reduced by
‘‘(ii) $12,000,000,000.
‘‘(4) BASE OBLIGATION ALLOTMENTS.—
‘‘(A) GENERAL RULE FOR 50 STATES AND
THE DISTRICT OF COLUMBIA.—Except as pro-
839
vided in this paragraph, the ‘base obligation al-
lotment’ for any of the 50 States or the District
of Columbia for a fiscal year (beginning with
fiscal year 1997) is an amount that bears the
same ratio to the base outlay allotment under
subsection (c)(2) for such State or District (not
taking into account any adjustment due to an
election under subsection (c)(4)) for the fiscal
year as the ratio of—
‘‘(i) the aggregate limit on new base
obligation authority (less the total of the
obligation allotments under subparagraph
(B)) for the fiscal year, to
‘‘(ii) the base pool amount (less the
sum of the base outlay allotments for the
territories) for such fiscal year.
‘‘(B) TERRITORIES.—The base obligation
allotment for each of the Commonwealths and
territories for a fiscal year is the base outlay al-
lotment for such Commonwealth or Territory
(as determined under subsection (c)(5)) for the
fiscal year divided by the payout adjustment
factor for the fiscal year (as defined in para-
graph (3)(B)).
840
‘‘(C) TRANSITIONAL
RULE
FOR
FISCAL
YEAR 1997.—
‘‘(i) IN
GENERAL.—The obligation
amount for fiscal year 1997 for any State
(including the District of Columbia, a
Commonwealth, or Territory) is deter-
mined according to the formula: A=(B-C)/
D, where—
‘‘(I) ‘A’ is the base obligation
amount for such State,
‘‘(II) ‘B’ is the base outlay allot-
ment of such State for fiscal year
1997, as determined under subsection
(c),
‘‘(III) ‘C’ is the amount of the
pre-enactment-obligation outlays (as
established for such State under
clause (ii)), and
‘‘(IV) ‘D’ is the payout adjust-
ment factor for such fiscal year (as
defined in paragraph (3)(B)).
‘‘(ii) PRE-FISCAL YEAR 1997-OBLIGA-
TION OUTLAY AMOUNTS.—Not later than
November 1, 1996, the Secretary shall es-
timate (based on the best data available)