I
104TH CONGRESS
1ST SESSION
H. R. 1502
To amend title XIX of the Social Security Act to prohibit a State from
requiring any child with special health care needs to receive services
under the State’s plan for medical assistance under such title through
enrollment with a capitated managed care plan until the State adopts
pediatric risk adjustment methodologies to take into account the costs
to capitated managed care plans of providing services to such children,
and to direct the Secretary of Health and Human Services to develop
model pediatric risk adjustment methodologies for such purpose.
IN THE HOUSE OF REPRESENTATIVES
APEIL 7, 1995
Mrs. LINCOLN introduced the following bill; which was referred to the
Committee on Commerce
A BILL
To amend title XIX of the Social Security Act to prohibit
a State from requiring any child with special health
care needs to receive services under the State’s plan
for medical assistance under such title through enroll-
ment with a capitated managed care plan until the State
adopts pediatric risk adjustment methodologies to take
into account the costs to capitated managed care plans
of providing services to such children, and to direct the
Secretary of Health and Human Services to develop
model pediatric risk adjustment methodologies for such
purpose.
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’s Health
Equity Act of 1995’’.
SEC. 2. PROHIBITING STATE MEDICAID PLANS FROM RE-
QUIRING CHILDREN WITH SPECIAL HEALTH
CARE NEEDS TO ENROLL IN MANAGED CARE
PLANS.
(a) IN GENERAL.—Section 1903(m) of the Social Se-
curity Act (42 U.S.C. 1396b(m)) is amended by inserting
after paragraph (2) the following new paragraph:
‘‘(3)(A) A State may not require a child with special
health care needs who is eligible to receive any medical
assistance under the State plan for any quarter to enroll
with a capitated managed care plan to receive such assist-
ance during the quarter, unless the State has adopted pe-
diatric risk adjustment methodologies under which the
State adjusts the payment rates for such plans to take
into account the financial risks of enrolling such children.
‘‘(B) In this paragraph—
‘‘(i) the term ‘capitated managed care plan’
means an entity which—
‘‘(I) has a contract with the State agency
under which such entity is paid a fixed amount
for providing or arranging for the provision of
health care items or services specified in such
contract to an individual eligible for medical as-
sistance under the State plan and enrolled with
such entity, regardless of whether such items or
services are furnished to such individual, and
‘‘(II) is liable for all or part of the cost of
furnishing any of such items or services, re-
gardless of whether such cost exceeds such fixed
payment; and
‘‘(i) the term ‘child with special health care
needs’ means any individual eligible for supplemental
security income under title XVI who is under 18
years of age, a child described under section
501(a)(1)(D), or a child described in section
1902(e)(3).’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to quarters beginning on or
after the date of the enactment of this Act.
SEC. 3. DEVELOPMENT OF MODEL PEDIATRIC RISK AD-
JUSTMENT METHODOLOGIES UNDER MEDIC-
AID TO TAKE INTO ACCOUNT ENROLLMENT
OF CHILDREN WITH SPECIAL HEALTH CARE
NEEDS IN MANAGED CARE PLANS.
(a) IN GENERAL.—The Secretary of Health and
Human Services, acting through the Administrator of the
Health Care Financing Administration, shall develop
model pediatric risk adjustment methodologies under sec-
tion 1903(m)(3) of the Social Security Act (as added by
section 2(a)) which State plans for medical assistance
under title XIX of such Act may use to adjust payment
rates for capitated managed care plans to take into ac-
count the financial risks to capitated managed care plans
of enrolling children with special health care needs.
(b) REPORT TO CONGRESS.—Not later than 2 years
after the date of the enactment of this Act, the Secretary
shall submit a report to Congress on the methodologies
developed under subsection (a) and on the feasibility of
applying the methodologies to State plans under title XIX
of the Social Security Act for purposes of section
1903(m)(3) of such Act.
(c) DEFINITIONS.—In this section, the terms
‘‘capitated managed care plan’’ and ‘‘children with special
health care needs’’ have the meaning given such terms in
section 1903(m)(3) of the Social Security Act (as added
by section 2(a)).
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