establishment of reasonable and efficient payment meth-
odologies including fee-for-service payments, case rates, 
daily rates, or other forms of capitated payment.’’. 
SEC. 203. PROTECTING HEALTH AND SAFETY. 
Section 1915(c)(4) of the Social Security Act (42 
U.S.C. 1396n(c)(4)) is amended by adding after the sec-
ond sentence the following new sentence: ‘‘For the purpose 
of developing and monitoring the implementation of the 
written plan of care required under paragraph (1), and 
to assure the health and welfare of individuals, the State 
may require case management services for each bene-
ficiary and may limit the case managers available with re-
spect to case management services for eligible individuals 
in order to ensure that the case managers for such individ-
uals are capable of ensuring that such individuals receive 
needed services.’’. 
SEC. 204. CODIFICATION OF OLMSTEAD STANDARD; PRO-
TECTING CHILDREN. 
Section 1915(g)(2)(A) of the Social Security Act (42 
U.S.C. 1396n(g)(2)(A)) is amended— 
(1) in clause (i), by striking ‘‘services which 
will’’ and all that follows through the period and in-
serting ‘‘services furnished to assist individuals, eli-
gible under the State plan who reside in a commu-
nity setting or are transitioning to a community set-
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ting, in gaining access to needed medical, social, 
educational, and other services. Such services may 
be offered by staff of non-medical programs or those 
who contract with non-medical programs, so long as 
such individuals are qualified providers under the 
State plan under this title and the case management 
services are distinct from the direct services of the 
non-medical program.’’; 
(2) by redesignating clause (ii) as clause (iii); 
and 
(3) by inserting after clause (i) (as amended by 
paragraph (1)), the following new clause: 
‘‘(ii) For purposes of providing case manage-
ment services, individuals (other than individuals 
who have attained age 22 but not attained age 65 
and are patients in an institution for mental dis-
eases or individuals who are inmates of public insti-
tutions) may be considered to be transitioning to a 
community setting for up to the last 180 days of an 
institutional stay.’’. 
SEC. 205. ASSURING APPROPRIATE CASE MANAGEMENT. 
Section 1915(g)(4) of the Social Security Act (42 
U.S.C. 1396n(g)(4)), as amended by section 202, is 
amended by adding at the end the following: 
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‘‘(D) Nothing in this subsection shall be construed 
as prohibiting a State from providing case management 
or targeted case management services, as defined in sub-
paragraphs (A) and (B), respectively, of paragraph (2), 
through multiple case managers to any individual who 
qualifies for medical assistance under the State plan, or 
to specific classes of individuals, or to individuals who re-
side in specified areas, selected by the State pursuant to 
this subsection.’’. 
Æ 
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