I 
108TH CONGRESS 
1ST SESSION 
H. R. 449
To amend title XXI of the Social Security Act to permit the use of unex-
pended allotments under the State children’s health care program for 
an additional fiscal year, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JANUARY 29, 2003
Ms. DUNN (for herself, Mrs. WILSON of New Mexico, Mr. NETHERCUTT, Mr. 
DICKS, Mr. HASTINGS of Washington, Mr. BAIRD, Mr. MCDERMOTT, and 
Mr. INSLEE) introduced the following bill; which was referred to the 
Committee on Energy and Commerce 
A BILL 
To amend title XXI of the Social Security Act to permit 
the use of unexpended allotments under the State chil-
dren’s health care program for an additional fiscal year, 
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. 
This Act may be cited as the ‘‘Children First SCHIP 
Improvement Act of 2003’’.
SEC. 2. PERMITTING USE OF RETAINED FISCAL YEARS 1998, 
1999, AND 2000 SCHIP ALLOTMENTS THROUGH 
FISCAL YEAR 2004. 
(a) RETAINED AND REDISTRIBUTED ALLOTMENTS 
FOR
FISCAL
YEARS
1998 
AND
1999.—Paragraphs 
(1)(B)(ii), (2)(A)(i), and (2)(A)(ii) of section 2104(g) of 
the Social Security Act (42 U.S.C. 1397dd(g)) are each 
amended by striking ‘‘fiscal year 2002’’ and inserting ‘‘fis-
cal year 2004’’. 
(b) FISCAL YEAR 2000.—Section 2104(g)(2) of such 
Act (42 U.S.C. 1397dd(g)(2)) is amended—
(1) in the heading, by striking ‘‘AND 1999’’ and 
inserting ‘‘THROUGH 2000’’; 
(2) by adding at the end of subparagraph (A) 
the following: 
‘‘(iii) FISCAL
YEAR
2000
ALLOT-
MENT.—
‘‘(I) IN
GENERAL.—Except as 
provided in subclause (II) with respect 
to high unemployment States, of the 
amounts allotted to a State pursuant 
to this section for fiscal year 2000 
that were not expended by the State 
by the end of fiscal year 2002, the 
amount specified in subparagraph (B) 
for fiscal year 2000 for such State
shall remain available for expenditure 
by the State through the end of fiscal 
year 2004. 
‘‘(II) SPECIAL RULE FOR HIGH 
UNEMPLOYMENT
STATES.—With re-
spect only to high unemployment 
States (as defined in subparagraph 
(D)), of the amounts allotted to such 
a State pursuant to this section for 
fiscal year 2000 that were not ex-
pended by the State by the end of fis-
cal year 2002, all such amounts for 
fiscal year 2000 for such State shall 
remain available for expenditure by 
the State through the end of fiscal 
year 2004.’’; and 
(3) by adding at the end the following new sub-
paragraph: 
‘‘(D) HIGH
UNEMPLOYMENT
STATE
DE-
FINED.— 
For 
purposes 
of 
subparagraph 
(A)(iii), the term ‘high unemployment State’ 
means a State that is any of the 50 States or 
the District of Columbia and that had an unem-
ployment rate (seasonally adjusted) of at least
6 percent in each of two consecutive months in 
2002.’’. 
(c) USE OF UNUSED FISCAL YEAR 1998 THROUGH 
2000 FUNDS.—Section 2104(g) of such Act (42 U.S.C. 
1397dd(g)), as amended by subsection (b), is further 
amended by adding at the end the following new para-
graph: 
‘‘(5) USE OF UNEXPENDED FISCAL YEARS 1998 
THROUGH 2000 ALLOTMENTS.—Notwithstanding any 
waiver granted under section 1115 or otherwise for 
the use of funds under title XIX or this title that 
is approved as of December 31, 2002, amounts 
made available for expenditure under this subsection 
to provide child health assistance under this title 
shall be expended in accordance with the following 
priority: 
‘‘(A) First to children who are eligible for 
child health assistance under this title. 
‘‘(B) Second to children who are eligible 
for medical assistance under title XIX.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall be effective as if this section had been 
enacted on December 31, 2002, and amounts under title 
XXI of the Social Security Act (42 U.S.C. 1397 et seq.) 
from allotments for fiscal years 1998 through 2000 are
available for expenditure on and after October 1, 2002, 
under the amendments made by this section as if this sec-
tion had been enacted on December 31, 2002. 
SEC. 3. SCHIP COVERAGE OF CHILDREN ABOVE THE MED-
ICAID MANDATORY LEVEL FOR CERTAIN 
STATES 
MEETING 
ADDITIONAL 
REQUIRE-
MENTS. 
Section 2110(b) of the Social Security Act (42 U.S.C. 
1397jj(b)) is amended—
(1) in paragraph (1)(B)(ii)—
(A) by striking ‘‘or’’ at the end of sub-
clause (II); 
(B) by by striking ‘‘and’’ at the end of 
subclause (III) and inserting ‘‘or’’; and 
(C) by adding at the end the following new 
subclause: 
‘‘(IV) who is residing in an eligible 
State (as defined in paragraph (5))) and 
whose family income (as determined under 
the State child health plan) exceeds 133 
percent of the poverty line but does not ex-
ceed 50 percentage points above the med-
icaid applicable income level; and’’; 
(2) in paragraph (1)(C), by striking ‘‘who is not 
found to be eligible for medical assistance under title
XIX or’’ and inserting ‘‘who (i) is not found to be 
eligible for medical assistance under title XIX or is 
so eligible but is described in subparagraph 
(B)(ii)(IV), and (ii) is not found to be’’; and 
(3) by adding at the end the following new 
paragraph: 
‘‘(5) ELIGIBLE STATE.—For purposes of para-
graph (1)(B)(ii)(IV), an eligible State is a State 
that, with respect to the fiscal year involved, meets 
all of the following conditions: 
‘‘(A) EXPANDED
ELIGIBILITY
OF
CHIL-
DREN UNDER MEDICAID.—The State’s plan for 
medical assistance under title XIX provides, in 
effect as of March 31, 1997, for eligibility for 
medical assistance of children who are under 19 
years of age and whose family income equals or 
exceeds 185 percent of the poverty line. 
‘‘(B) HIGHEST
SCHIP
INCOME
ELIGI-
BILITY.—The State child health plan (whether 
implemented under this title or under title 
XIX)—
‘‘(i) has the highest income eligibility 
standard permitted under this title as of 
January 1, 2001;
‘‘(ii) does not impose any waiting list, 
numerical limitation, or similar limitation 
on the eligibility of children for child 
health assistance; and 
‘‘(iii) provides benefits to all children 
in the State who apply for and meet eligi-
bility standards. 
‘‘(C) NO
LOSS
OF
MEDICAID
OR
SCHIP 
COVERAGE
DUE
TO
INABILITY
TO
PAYMENT 
PREMIUMS
AND
COST-SHARING.—The State’s 
plan for medical assistance under title XIX and 
the State child health plan do not deny an eligi-
ble child coverage or needed care because of an 
inability to pay premiums or cost-sharing other-
wise imposed under the respective plan. 
‘‘(D) UNIFORM, SIMPLIFIED APPLICATION 
FORM.—With respect to children who are eligi-
ble for medical assistance under section 
1902(a)(10)(A), the State uses the same uni-
form, simplified application form (including, if 
applicable, permitting application other than in 
person) for purposes of establishing eligibility 
for benefits under this title and also under title 
XIX.
‘‘(E) NO ASSET TEST.—The State does not 
impose an asset test for eligibility under this 
title or under section 1902(l) with respect to 
children. 
‘‘(F) 12-MONTH
CONTINUOUS
ENROLL-
MENT.—The State has elected the option of 
continuing eligibility under section 1902(e)(12) 
and has elected a 12-month period under sub-
paragraph (A) of such section and provides for 
a similar period of continuous eligibility under 
the State child health plan. 
‘‘(G) COORDINATED
ENROLLMENT
PROC-
ESS.—The State’s enrollment process under 
this title is coordinated with such process under 
title XIX so that—
‘‘(i) a family need only interact with a 
single agency in order to determine wheth-
er a child is eligible for benefits under this 
title or title XIX; and 
‘‘(ii) transfers of enrollment, without 
a gap in coverage, automatically occur for 
a child in a family the income of which 
changes so that the child is no longer eligi-
ble for benefits under one such title but be-
comes eligible for benefits under the other 
title. 
‘‘(H) SAME VERIFICATION AND REDETER-
MINATION
POLICIES; 
AUTOMATIC
REASSESS-
MENT OF ELIGIBILITY.—With respect to chil-
dren who are eligible for medical assistance 
under section 1902(a)(10)(A), the State pro-
vides for initial eligibility determinations and 
redeterminations of eligibility using the same 
verification policies (including policies respect-
ing face-to-face interviews), forms, and fre-
quency as the State uses for such purposes 
under this title, and, as part of such redeter-
minations, provides for the automatic reassess-
ment of the eligibility of such children for as-
sistance under this title and title XIX.’’.
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