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‘‘(III) is receiving or is an applicant
for such medical assistance, and
‘‘(ii) the State has become aware that assets
have been transferred.
‘‘(3)(A) The State plan may include, in accordance
with this paragraph, any or all of the following provisions
concerning eligibility for medical assistance of individuals
who (or whose spouses) dispose of assets for less than fair
market value:
‘‘(i) The State plan may provide for periods of
ineligibility for medical assistance for long-term care
services specified by the State and approved by the
Secretary for any or all individuals (or groups of in-
dividuals) otherwise eligible for such medical assist-
ance, in addition to the individuals specified in para-
graph (1).
‘‘(ii) Subject to such restrictions as the Secretary
may impose, the State plan may provide for periods
of ineligibility for medical assistance for any long-
term care services (in addition to the services speci-
fied in paragraph (1)(A)) for which medical assist-
ance is otherwise available under the plan.
‘‘(iii) The State plan may provide for a date on
and after which transfers of assets are subject to re-
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view earlier than the date specified in paragraph
(1)(B)(ii), but not earlier than 4 years before—
‘‘(I) in the case of an institutionalized indi-
vidual, the date specified in paragraph (1)(B)(i),
or 
‘‘(II) in the case of any other individual,
the date on which the individual applied for
medical assistance under the State plan.
‘‘(B)(i) The period of ineligibility imposed by the State
pursuant to this paragraph for services other than those
specified in paragraph (1)(A) shall not be longer than the
period of ineligibility that would have resulted if the indi-
vidual had expended the assets transferred for the costs of
medical care furnished on and after the date the individual
applied for medical assistance, as determined by the State
in accordance with clause (ii).
‘‘(ii) In determining the period of ineligibility of an
individual pursuant to clause (i), the State—
‘‘(I) may presume that the individual’s cost of
medical care furnished is equal to the average cost to
a private patient for such care on a daily, monthly,
or other basis, or
‘‘(II) may use any other method approved by the
Secretary.’’;
(3) in paragraph (4), as redesignated—
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(A) by amending subparagraph (B) to read
as follows:
‘‘(B) the resources—
‘‘(i) were transferred to the individual’s
spouse or to another for the sole benefit of the in-
dividual’s spouse and did not exceed the amount
permitted under section 1924(f)(1);
‘‘(ii) were transferred from the individual’s
spouse to another for the sole benefit of the indi-
vidual’s spouse and did not exceed the amount
permitted under section 1924(f)(1); or
‘‘(iii) were transferred to the individual’s
child described in subparagraph (A)(ii)(II);’’;
(B) in subparagraph (C)—
(i) by striking ‘‘any’’;
(ii) by striking ‘‘or (ii)’’ and inserting
‘‘(ii)’’; and
(iii) by striking ‘‘; or’’ and inserting ‘‘,
or (iii) all assets transferred by an individ-
ual for less than fair market value have
been returned to the individual;’’;
(C) by amending subparagraph (D) to read
as follows:
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‘‘(D) the State determines (in accordance with
regulations promulgated by the Secretary) that denial
of eligibility would work an undue hardship; or’’;
(D) by adding at the end the following new
subparagraph:
‘‘(E) the State determines that the total fair
market value of all of the assets transferred by the in-
dividual during the period between the date specified
in paragraph (1)(B)(i) and the date specified by the
State under paragraph (1)(B)(ii) are below an
amount determined appropriate by the State and ap-
proved by the Secretary.’’; and
(E) by adding at the end the following flush
sentence:
‘‘In determining whether an individual has made a satis-
factory showing to the State under subparagraph (C)(ii),
the State shall consider the individual’s health status at the
time of the transfer of assets and whether, at the time of
such transfer, the individual retained assets sufficient to
meet the individual’s foreseeable future health care needs
based on such health status.’’;
(4) by striking paragraph (5), as redesignated,
and inserting the following:
‘‘(5) For purposes of this subsection, in the case of an
asset held by an individual in common with another person
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or persons in a joint tenancy, tenancy in common, or simi-
lar arrangement, the asset (or the affected portion of such
asset) shall be considered to be transferred by such individ-
ual when any action is taken, either by such individual
or by any other person, that reduces or eliminates such in-
dividual’s ownership or control of such asset, except to the
extent an action taken by a person other than the individ-
ual is an action consistent with partial ownership of the
asset, as provided in regulations issued by the Secretary.’’;
(5) by adding the following at the end of para-
graph (6), as redesignated: ‘‘In the case of a transfer
by the spouse of an institutionalized individual which
results in a period of ineligibility for medical assist-
ance under a State plan for the institutionalized in-
dividual, a State shall apply a reasonable methodol-
ogy to transfer all or a portion of any such period of
ineligibility to such spouse if the spouse becomes an
institutionalized individual.’’; and
(6) by amending paragraph (7), as redesignated,
to read as follows:
‘‘(7) For purposes of this subsection:
‘‘(A) The term ‘assets’, with respect to an indi-
vidual, includes all income and resources of the indi-
vidual and of the individual’s spouse, including any
income or resources which the individual or such in-
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dividual’s spouse is entitled to but does not receive be-
cause of action—
‘‘(i) by the individual or such individual’s
spouse,
‘‘(ii) by a person, including a court or ad-
ministrative body, with legal authority to act in
place of or on behalf of the individual or such in-
dividual’s spouse, or
‘‘(iii) by any person, including any court or
administrative body, acting at the direction or
upon the request of the individual or such indi-
vidual’s spouse.
‘‘(B) The term ‘income’ has the meaning given
such term in section 1612.
‘‘(C) The term ‘resources’ has the meaning given
such term in section 1613, without regard (in the case
of an institutionalized individual) to the exclusion de-
scribed in subsection (a)(1) of such section.
‘‘(D) The term ‘institutionalized individual’
means, and the term ‘individual is institutionalized’
refers to, an individual receiving any of the services
specified in paragraph (1)(A).’’.
(b) 
CONFORMING
AMENDMENTS.—(1) 
Section
1902(a)(51) (42 U.S.C. 1396a(a)(51)) is amended—
(A) by striking ‘‘(A)’’; and
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(B) by striking ‘‘, and (B)’’ and all that follows
and inserting a semicolon.
(2) Section 1924(f)(1) (42 U.S.C. 1396r–5(f)(1)) is
amended by striking ‘‘transfer an amount’’ and inserting
‘‘transfer an amount sufficient to make the resources of the
community spouse’’.
(c) REQUIREMENTS FOR NURSING FACILITIES.—
(1) 
MEDICAID
PROGRAM.—Section
1919(c)(5)(A)(i) (42 U.S.C. 1396r(c)(5)(A)(i)) is
amended by striking ‘‘and (III)’’ and inserting ‘‘(III)
not require individuals applying to reside or residing
in the facility, or family members of such individuals,
to provide any financial information other than to
identify the source of payment for such individual’s
stay in the facility, and (IV)’’.
(2) 
MEDICARE
PROGRAM.—Section
1819(c)(5)(A)(i) (42 U.S.C. 1395i–3(c)(5)(A)(i)) is
amended by striking ‘‘and (III)’’ and inserting ‘‘(III)
not require individuals applying to reside or residing
in the facility, or family members of such individuals,
to provide any financial information other than to
identify the source of payment for such individual’s
stay in the facility, and (IV)’’.
(d) EFFECTIVE DATE.—(1)(A) Except as provided in
subparagraph (B), the amendments made by this section
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shall apply to calendar quarters beginning on or after Octo-
ber 1, 1993.
(B) In the case of a State plan for medical assistance
under title XIX of the Social Security Act which the Sec-
retary of Health and Human Services determines requires
State legislation (other than legislation appropriating
funds) in order for the plan to meet the additional require-
ments imposed by the amendments made by this section,
the State plan shall not be regarded as failing to comply
with the requirements imposed by such amendments solely
on the basis of its failure to meet these additional require-
ments before the first day of the first calendar quarter be-
ginning after the close of the first regular session of the
State legislature that begins after the date of the enactment
of this Act. For purposes of the preceding sentence, in the
case of a State that has a 2-year legislative session, each
year of such session shall be deemed to be a separate regular
session of the State legislature.
(2) The amendments made by this section shall not
apply with respect to assets disposed of before the date
which is 60 days after the date of the enactment of this
Act.
SEC. 7423. TREATMENT OF CERTAIN TRUSTS.
(a) IN GENERAL.—Section 1917 (42 U.S.C. 1396p) is
amended by adding at the end the following:
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‘‘(d)(1) For purposes of determining an individual’s
eligibility for, or amount of, benefits under a State plan
under this title, the following rules shall apply to a trust
established by such individual:
‘‘(A) In the case of a revocable trust—
‘‘(i) the corpus of the trust shall be consid-
ered resources available to the individual,
‘‘(ii) payments from the trust to or for the
benefit of the individual shall be considered in-
come of the individual, and
‘‘(iii) any other payments from the trust
shall be considered a transfer of assets by the in-
dividual subject to subsection (c).
‘‘(B) In the case of an irrevocable trust—
‘‘(i) the portion of the corpus from which, or
the income on the corpus from which, payment
to the individual could be made shall be consid-
ered resources available to the individual, and
payments from that portion of the corpus or in-
come—
‘‘(I) to or for the benefit of the individ-
ual, shall be considered income of the indi-
vidual, and
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‘‘(II) for any other purpose, shall be
considered a transfer of assets by the indi-
vidual subject to subsection (c); and
‘‘(ii) any portion of the trust from which, or
any income on the corpus from which, no pay-
ment could under any circumstances be made to
the individual shall be considered, as of the date
of establishment of the trust (or, if later, the date
on which payment to the individual was fore-
closed) a transfer of assets by the individual sub-
ject to subsection (c), and payments from such
portion of the trust after such date shall be dis-
regarded.
‘‘(2)(A) For purposes of this subsection, an individual
shall be considered to have established a trust if—
‘‘(i) any of the following individuals established
such trust other than by will:
‘‘(I) the individual,
‘‘(II) the individual’s spouse,
‘‘(III) a person, including a court or ad-
ministrative body, with legal authority to act in
place of or on behalf of the individual or the in-
dividual’s spouse, or
‘‘(IV) a person, including any court or ad-
ministrative body, acting at the direction or
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upon the request of the individual or the individ-
ual’s spouse; and
‘‘(ii) assets of the individual were used to form
all or part of the corpus of the trust.
‘‘(B) In the case of a trust the corpus of which includes
assets of an individual (as determined under subparagraph
(A)) and assets of any other person or persons, the provi-
sions of this subsection shall apply to the portion of the
trust attributable to the assets of the individual.
‘‘(3) This subsection shall apply without regard to—
‘‘(A) the purposes for which a trust is estab-
lished,
‘‘(B) whether the trustees have or exercise any
discretion under the trust,
‘‘(C) any restrictions on when or whether dis-
tributions may be made from the trust, or
‘‘(D) any restrictions on the use of distributions
from the trust.
‘‘(4)(A) This subsection shall not apply to any of the
following trusts:
‘‘(i) A trust containing the assets of a disabled
individual (as determined under section 1614(a)(3))
established for the benefit of such individual by a par-
ent, grandparent, legal guardian of the individual, or
a court if the State will receive all amounts remain-
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ing in the trust upon the death of such individual up
to an amount equal to the total medical assistance re-
ceived by the individual under a State plan under
this title.
‘‘(ii) A trust established in a State for the benefit
of an individual if—
‘‘(I) the trust is composed only of pension,
Social Security, and other income to the individ-
ual (and accumulated income in the trust),
‘‘(II) the State will receive all amounts re-
maining in the trust upon the death of such in-
dividual up to an amount equal to the total
medical assistance received by the individual
under a State plan under this title, and
‘‘(III) the State makes medical assistance
available to individuals described in section
1902(a)(10)(A)(ii)(V), but does not make such
assistance available to individuals for nursing
facility services under section 1902(a)(10)(C).
‘‘(B) For purposes of this subsection, the term ‘trust’
includes any legal instrument or device that is similar to
a trust but includes an annuity only to such extent and
in such manner as the Secretary specifies.
‘‘(C) The State agency shall establish procedures (in
accordance with standards specified by the Secretary) under
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which the agency waives the application of this subsection
with respect to an individual if the individual establishes
that such application would work an undue hardship on
the individual as determined on the basis of criteria estab-
lished by the Secretary.
‘‘(5) For purposes of this subsection, the terms ‘assets’,
‘income’, and ‘resources’ shall have the meaning given to
such terms under subsection (c)(7).’’.
(b) 
CONFORMING
AMENDMENTS.—(1) 
Section
1902(a)(18) (42 U.S.C. 1396a(a)(18)) is amended by strik-
ing ‘‘and transfers of assets’’ and inserting ‘‘, transfers of
assets, and treatment of certain trusts’’.
(2) Section 1902 (42 U.S.C. 1396a) is amended by re-
pealing subsection (k).
(c) EFFECTIVE DATE.—(1)(A) Except as provided in
subparagraph (B), the amendments made by this section
shall apply to payments under title XIX of the Social Secu-
rity Act for calendar quarters beginning on or after October
1, 1993.
(B) In the case of a State plan for medical assistance
under title XIX of the Social Security Act which the Sec-
retary of Health and Human Services determines requires
State legislation (other than legislation appropriating
funds) in order for the plan to meet the additional require-
ments imposed by the amendments made by this section,
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the State plan shall not be regarded as failing to comply
with the requirements imposed by such amendments solely
on the basis of its failure to meet these additional require-
ments before the first day of the first calendar quarter be-
ginning after the close of the first regular session of the
State legislature that begins after the date of the enactment
of this Act. For purposes of the preceding sentence, in the
case of a State that has a 2-year legislative session, each
year of such session shall be deemed to be a separate regular
session of the State legislature.
(2) The amendments made by this section shall not
apply with respect to trusts established before the date which
is 60 days after the date of the enactment of this Act.
Subpart D—Improvement in Identification and
Collection of Third Party Payments
SEC. 7431. LIABILITY OF THIRD PARTIES TO PAY FOR CARE
AND SERVICES.
(a) LIABILITY
OF
ERISA PLANS.—(1) Section
1902(a)(25)(A) (42 U.S.C. 1396a(a)(25)(A)) is amended by
striking ‘‘insurers)’’ and inserting ‘‘insurers, group health
plans (as defined in section 607(1) of the Employee Retire-
ment Income Security Act of 1974), service benefit plans,
and health maintenance organizations)’’.
(2) Section 1903(o) (42 U.S.C. 1396b(o)) is amended
by striking ‘‘regulation)’’ and inserting ‘‘regulation and in-
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cluding a group health plan (as defined in section 607(1)
of the Employee Retirement Income Security Act of 1974)),
a service benefit plan, and a health maintenance organiza-
tion’’.
(b) REQUIRING STATE TO PROHIBIT INSURERS FROM
TAKING
MEDICAID
STATUS
INTO
ACCOUNT.—Section
1902(a)(25) (42 U.S.C. 1396a(a)(25)) is amended—
(1) by striking ‘‘and’’ at the end of subpara-
graph (F);
(2) by adding ‘‘and’’ at the end of subparagraph
(G); and
(3) by adding after subparagraph (G) the follow-
ing new subparagraph:
‘‘(H) assurances satisfactory to the Sec-
retary that the State has in effect laws which
prohibit any health insurer (including a group
health plan, as defined in section 607(1) of the
Employee Retirement Income Security Act of
1974, a service benefit plan, and a health main-
tenance organization), in enrolling an individ-
ual or in making any payments for benefits to
the individual or on the individual’s behalf, from
taking into account that the individual is eligi-
ble for or is provided medical assistance under a
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plan under this title for such State, or any other
State;’’.
(c) STATE RIGHT TO THIRD PARTY PAYMENTS FOR
RECIPIENT.—Section 
1902(a)(25) 
(42 
U.S.C.
1396a(a)(25)), as amended by subsection (b), is amended—
(1) by striking ‘‘and’’ at the end of subpara-
graph (G);
(2) by adding ‘‘and’’ at the end of subparagraph
(H); and
(3) by adding after subparagraph (H) the follow-
ing new subparagraph:
‘‘(I) assurances satisfactory to the Secretary
that the State has in effect laws under which, to
the extent that payment has been made under the
State plan for medical assistance for health care
items or services furnished to an individual, the
State is considered to have acquired the rights of
such individual to payment by any other party
for such health care items or services;’’.
(d) EFFECTIVE DATE.—(1) Except as provided in
paragraph (2), the amendments made by subsections (a)(1),
(b), and (c) shall apply to calendar quarters beginning on
or after October 1, 1993, without regard to whether or not
final regulations to carry out such amendments have been
promulgated by such date.
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(2) In the case of a State plan for medical assistance
under title XIX of the Social Security Act which the Sec-
retary of Health and Human Services determines requires
State legislation (other than legislation appropriating
funds) in order for the plan to meet the additional require-
ments imposed by the amendments made by subsections (a)
and (b), the State plan shall not be regarded as failing to
comply with the requirements of such title solely on the
basis of its failure to meet these additional requirements
before the first day of the first calendar quarter beginning
after the close of the first regular session of the State legisla-
ture that begins after the date of the enactment of this Act.
For purposes of the preceding sentence, in the case of a State
that has a 2-year legislative session, each year of such ses-
sion shall be deemed to be a separate regular session of the
State legislature.
(3) The amendment made by subsection (a)(2) shall
apply to items and services furnished on or after October
1, 1993.
SEC. 7432. MEDICAL CHILD SUPPORT.
(a) STATE PLAN REQUIREMENT.—Section 1902(a) (42
U.S.C. 1396a(a)), as amended by subsection (c), is amend-
ed—
(1) by striking ‘‘and’’ at the end of paragraph
(58);
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(2) by striking the period at the end of para-
graph (59) and inserting ‘‘; and’’; and
(3) by adding at the end the following new para-
graph:
‘‘(60) provide that the State agency shall provide
assurances satisfactory to the Secretary that the State
has in effect the laws relating to medical child sup-
port required under section 1908.’’.
(b) MEDICAL CHILD SUPPORT LAWS.—Title XIX (42
U.S.C 1936 et seq.) is amended by inserting after section
1907 the following new section:
‘‘REQUIRED LAWS RELATING TO MEDICAL CHILD SUPPORT
‘‘SEC. 1908. (a) IN GENERAL.—The laws relating to
medical child support, which a State is required to have
in effect under section 1902(a)(60), are as follows:
‘‘(1) A law that prohibits an insurer from deny-
ing enrollment of a child under the health coverage of
the child’s parent on the ground that—
‘‘(A) the child was born out of wedlock,
‘‘(B) the child is not claimed as a depend-
ent on the parent’s Federal income tax return, or
‘‘(C) the child does not reside with the par-
ent or in the insurer’s service area.
‘‘(2) In any case in which a parent is required
by a court or administrative order to provide health
coverage for a child and the parent is eligible for fam-
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ily health coverage through an insurer, a law that re-
quires such insurer—
‘‘(A) to permit such parent to enroll under
such family coverage any such child who is oth-
erwise eligible for such coverage (without regard
to any enrollment season restrictions and subject
to the requirements under paragraph (1)); and
‘‘(B) if such a parent fails to provide such
health insurance coverage for any such child, to
enroll such child under such family coverage
upon application by the child’s other parent or
by the State agency administering the program
under this title or part D of title IV.
‘‘(3) In any case in which a parent is required
by a court or administrative order to provide health
coverage for a child and the parent is eligible for fam-
ily health coverage through an employer doing busi-
ness in the State, a law that requires such em-
ployer—
‘‘(A) to permit such parent to enroll under
such family coverage any such child who is oth-
erwise eligible for such coverage (without regard
to any enrollment season restrictions and subject
to the requirements under paragraph (1));
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‘‘(B) if such a parent fails to provide such
health insurance coverage for a child, to enroll
such child under such family coverage upon ap-
plication by the child’s other parent or by the
State agency administering the program under
this title or part D of title IV;
‘‘(C) not to disenroll (or eliminate coverage
of) any such child unless the employer is pro-
vided satisfactory written evidence that—
‘‘(i) such court or administrative order
is no longer in effect, or
‘‘(ii) the child is or will be enrolled in
comparable health coverage which will take
effect not later than the effective date of such
disenrollment; and
‘‘(D) to withhold from such employee’s com-
pensation the employee’s share (if any) of pre-
miums for health coverage and to pay such share
of premiums to the insurer.
‘‘(4) A law that prohibits an insurer from im-
posing requirements on a State agency, which has
been assigned the rights of an individual eligible for
medical assistance under this title and covered for
health benefits from the insurer, that are different
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from requirements applicable to an agent or assignee
of any other individual so covered.
‘‘(5) A law that requires an insurer, in any case
in which a child has health coverage through the in-
surer of a noncustodial parent—
‘‘(A) to provide such information to the cus-
todial parent as may be necessary for the child
to obtain benefits through such coverage;
‘‘(B) to permit the custodial parent (or pro-
vider, with the custodial parent’s approval) to
submit claims for covered services without the
approval of the noncustodial parent; and
‘‘(C) to make payment on claims submitted
in accordance with subparagraph (B) directly to
such custodial parent, the provider, or the State
agency.
‘‘(6) A law that permits the State agency under
this title to garnish the wages, salary, or other em-
ployment income of, and requires withholding
amounts from State tax refunds to, any person who—
‘‘(A) is required by court or administrative
order to provide coverage of the costs of health
services to a child who is eligible for medical as-
sistance under this title,
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‘‘(B) has received payment from a third
party for the costs of such services to such child,
but
‘‘(C) has not used such payments to reim-
burse, as appropriate, either the other parent or
guardian of such child or the provider of such
services,
to the extent necessary to reimburse the State agency
for expenditures for such costs under its plan under
this title, but any claims for current or past-due child
support shall take priority over any such claims for
the costs of such services.
‘‘(b) SPECIAL RULE.—The Secretary may provide by
regulation for such exceptions to the requirement under sub-
section (a)(3) as the Secretary determines necessary to en-
sure compliance with the conditions of any order referred
to in such subsection or with the maximum amounts per-
mitted to be withheld under section 303(b) of the Consumer
Credit Protection Act.
‘‘(c) DEFINITION.—For purposes of this subsection, the
term ‘insurer’ includes a group health plan, as defined in
section 607(1) of the Employee Retirement Income Security
Act of 1974, a health maintenance organization, and an
entity offering a service benefit plan.’’.
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(c) REDESIGNATIONS
TO PARAGRAPHS ADDED
BY
OBRA–1990.—Section 1902(a) (42 U.S.C. 1396a(a)) is
amended—
(1) by striking ‘‘and’’ at the end of paragraph
(54);
(2) in the paragraph (55) inserted by section
4602(a)(3) of OBRA–1990, by striking the period at
the end and inserting a semicolon;
(3) by redesignating the paragraph (55) inserted
by section 4604(b)(3) of OBRA–1990 as paragraph
(56), by transferring and inserting it after the para-
graph (55) inserted by section 4602(a)(3) of such Act,
and by striking the period at the end and inserting
a semicolon;
(4) by placing paragraphs (57) and (58), in-
serted by section 4751(a)(1)(C) of OBRA–1990, im-
mediately after paragraph (56), as redesignated by
paragraph (3);
(5) in the paragraph (58) inserted by section
4751(a)(1)(C) of OBRA–1990, by striking the period
at the end and inserting ‘‘; and’’; and
(6) by redesignating the paragraph (58) inserted
by section 4752(c)(1)(C) of OBRA–1990 as paragraph
(59) and by transferring and inserting it after the
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paragraph (58) inserted by section 4751(a)(1)(C) of
such Act.
(d) EFFECTIVE DATE.—(1) Except as provided in
paragraph (2), the amendments made by this section apply
to calendar quarters beginning on or after April 1, 1994.
(2) In the case of a State plan under title XIX of the
Social Security Act which the Secretary of Health and
Human Services determines requires State legislation in
order for the plan to meet the additional requirements im-
posed by the amendments made by this section, the State
plan shall not be regarded as failing to comply with the
requirements of such title solely on the basis of its failure
to meet these additional requirements before the first day
of the first calendar quarter beginning after the close of the
first regular session of the State legislature that begins after
the date of enactment of this Act. For purposes of the pre-
ceding sentence, in the case of a State that has a 2-year
legislative session, each year of such session shall be deemed
to be a separate regular session of the State legislature.
SEC. 7433. OFFSET OF PAYMENT OBLIGATIONS RELATING
TO MEDICAL ASSISTANCE AGAINST OVERPAY-
MENTS OF STATE AND FEDERAL INCOME
TAXES.
(a) AMENDMENTS TO THE INTERNAL REVENUE CODE
OF 1986.—
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(1) IN GENERAL.—Section 6402 of the Internal
Revenue Code of 1986 is amended—
(A) by redesignating subsections (e), (f), (g),
(h), and (i) as subsections (f), (g), (h), (i), and
(j), respectively; and
(B) by adding after subsection (d) the fol-
lowing new subsection:
‘‘(e) COLLECTION
OF CERTAIN DEBTS OWED
TO
STATES.—
‘‘(1) IN GENERAL.—Upon receiving notice from
any State under section 1931(b)(1) of the Social Se-
curity Act that a named person owes a legally en-
forceable debt for any payment obligation relating to
medical assistance, the Secretary shall—
‘‘(A) reduce the amount of any overpayment
payable to such person by the amount of such
debt;
‘‘(B) pay the amount by which such over-
payment is reduced under subparagraph (A) to
such State; and
‘‘(C) notify the person making such over-
payment that such overpayment has been re-
duced by an amount necessary to satisfy such
debt.
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‘‘(2) PRIORITIES
FOR
OFFSET.—Any overpay-
ment by a person shall be reduced pursuant to this
subsection after such overpayment is reduced pursu-
ant to subsections (c) and (d) and before such over-
payment is credited to the future liability for tax of
such person pursuant to subsection (b). Any overpay-
ment by a person shall be applied against any debts
described in paragraph (1) in the order in which such
debts accrued.
‘‘(3) NOTICE; PROTECTION OF OTHER PERSONS
FILING
JOINT
RETURN.—For purposes of this sub-
section, rules similar to the rules described in clause
(i) and the first sentence of clause (ii) of subsection
(d)(3)(B) shall apply.
‘‘(4) DEFINITION.—For purposes of this sub-
section, the term ‘medical assistance’ means medical
assistance provided under title XIX of the Social Se-
curity Act.’’.
(2) CONFORMING AMENDMENT.—Section 6402(f)
of the Internal Revenue Code of 1986, as redesignated,
is amended by striking ‘‘(c) or (d)’’ and inserting
‘‘(c), (d), or (e)’’.
(3) EFFECTIVE DATE.—The amendments made
by this subsection shall be effective for taxable years
beginning after December 31, 1993.
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(b) AMENDMENTS TO THE SOCIAL SECURITY ACT.—
(1) STATE PLAN AMENDMENT.—Section 1902(a)
(42 U.S.C. 1396a(a)), as amended by section 7432, is
amended—
(A) by striking ‘‘and’’ at the end of para-
graph (59);
(B) by striking the period at the end of
paragraph (60) and inserting ‘‘; and’’; and
(C) by adding at the end the following new
paragraph:
‘‘(61) provide that recovery of any legally en-
forceable debt for any payment obligation relating to
medical assistance provided under this title shall be
made in accordance with a program for the collection
of such debt from State and Federal tax refunds in
accordance with section 1931.’’.
(2) PROGRAM
FOR
COLLECTIONS
FROM
STATE
AND FEDERAL TAX REFUNDS.—Title XIX (42 U.S.C
1936 et seq.) is amended by adding at the end the fol-
lowing new section:
‘‘COLLECTION
OF
PAYMENT
OBLIGATIONS
RELATING
TO
MEDICAL ASSISTANCE FROM STATE AND FEDERAL TAX
REFUNDS
‘‘SEC. 1931. (a) STATE TAX REFUNDS.—If a State
with a State plan approved under this title has a State
income tax system, such State shall require the State agency
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administering the State plan and the State agency respon-
sible for administering the States income tax system to de-
velop and implement a program under which any person
determined appropriate by the State agency administering
the State plan who owes a legally enforceable debt for any
payment obligation relating to medical assistance provided
under this title will have withheld an appropriate amount
from any refund otherwise payable to such person under
the State income tax system.
‘‘(b) FEDERAL TAX REFUNDS.—
‘‘(1) NOTICE TO THE SECRETARY OF THE TREAS-
URY.—
‘‘(A) IN GENERAL.—If a State with a State
plan approved under this title—
‘‘(i) implements a program described
in subsection (a), or
‘‘(ii) is a State that does not have a
State income tax system,
the State agency administering such plan may
provide a notice to the Secretary of the Treasury
regarding any person determined appropriate by
such State agency who owes a legally enforceable
debt for any payment obligation relating to med-
ical assistance provided under this title and the
Secretary of the Treasury shall withhold an ap-
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propriate amount from any refund otherwise
payable to such person in accordance with sec-
tion 6402(e) of the Internal Revenue Code of
1986 (hereafter in this section referred to as the
‘Code’).
‘‘(B) REGULATIONS
RELATING
TO
NO-
TICES.—The Secretary of the Treasury shall
issue regulations, after consultation with the Sec-
retary, which—
‘‘(i) prescribe the timing by which
State agencies may submit notices of pay-
ment obligations relating to medical assist-
ance,
‘‘(ii) specify the manner in which such
notices must be submitted,
‘‘(iii) specify the necessary information
that must be contained in or accompany
such notices,
‘‘(iv) specify the minimum payment
obligation relating to medical assistance to
which the offset procedures may be applied,
‘‘(v) specify the fee that a State must
pay to reimburse the Secretary of the Treas-
ury for the full cost of applying the offset
procedure, and
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‘‘(vi) provide that the Secretary of the
Treasury will advise the Secretary, not less
frequently than annually, of the States
which have furnished notices under this sub-
section, the number of cases in each State
with respect to which such notices have been
furnished, the total amount of payment ob-
ligations sought to be collected under this
subsection by each State, and the amount of
such collections actually made in the case of
each State.
‘‘(2) NOTICE.—Prior to notifying the Secretary
of the Treasury under paragraph (1), the State agen-
cy shall send a notice to the person owing the legally
enforceable debt for a payment obligation relating to
medical assistance provided under this title which—
‘‘(A) explains that a withholding may be
made under 6402(e) of the Code from any refund
otherwise payable to such person,
‘‘(B) instructs the person having the pay-
ment obligation of the steps which may be taken
to contest the State’s determination that such
payment obligation is owed or the amount of the
payment obligation, and
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‘‘(C) provides information with respect to
procedures to be followed, in the case of a joint
return, to protect the share of the refund which
may be payable to another person.
‘‘(3) EXCESS
WITHHOLDING.—In any case in
which an amount was withheld under section 6402(e)
of the Code and the State subsequently determines
that the amount certified as owing with respect to
medical assistance was in excess of the amount actu-
ally owed at the time the amount withheld is distrib-
uted to the State, the State shall pay the excess
amount withheld to the named person determined to
have the payment obligation (or, in the case of
amounts withheld on the basis of a joint return, joint-
ly to the parties filing such return).’’.
(3) EFFECTIVE DATE.—
(A) IN GENERAL.—The amendments made
by this paragraph shall apply to calendar quar-
ters beginning on or after December 31, 1993.
(B) SPECIAL RULE.—In the case of a State
which the Secretary determines requires State
legislation (other than legislation authorizing or
appropriating funds) in order to comply with
the amendments made by subparagraph (A), the
State shall not be regarded as failing to comply
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with such amendments solely on the basis of its
failure to meet the requirements of such amend-
ments before the first day of the first calendar
quarter beginning after the close of the first regu-
lar session of the State legislature that begins
after the date of the enactment of this Act. For
purposes of the preceding sentence, in the case of
a State that has a 2-year legislative session, each
year of such session shall be deemed to be a sepa-
rate regular session of the State legislature.
Subpart E—Assuring Proper Payments to
Disproportionate Share Hospitals
SEC. 7441. ASSURING PROPER PAYMENTS TO DISPROPOR-
TIONATE SHARE HOSPITALS.
(a) DISPROPORTIONATE
SHARE
HOSPITALS
RE-
QUIRED TO PROVIDE MINIMUM LEVEL OF SERVICES TO
MEDICAID PATIENTS.—Section 1923 (42 U.S.C. 1396r–4)
is amended—
(1) in subsection (a)(1)(A), by striking ‘‘require-
ment’’ and inserting ‘‘requirements’’;
(2) in subsection (b)(1), by striking ‘‘require-
ment’’ and inserting ‘‘requirements’’;
(3) in the heading to subsection (d), by striking
‘‘REQUIREMENT’’ and inserting ‘‘REQUIREMENTS’’;
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(4) by adding at the end of subsection (d) the fol-
lowing new paragraph:
‘‘(3) No hospital may be defined or deemed as a
disproportionate share hospital under a State plan
under this title or under subsection (b) or (e) of this
section unless the hospital has a medicaid inpatient
utilization rate (as defined in subsection (b)(2)) of
not less than 1 percent.’’;
(5) in subsection (e)(1)—
(A) by striking ‘‘and’’ before ‘‘(B)’’, and
(B) by inserting before the period at the end
the following: ‘‘, and (C) the plan meets the re-
quirement of subsection (d)(3) and such payment
adjustments are made consistent with the fourth
sentence of subsection (c)’’; and
(6) in subsection (e)(2)—
(A) in subparagraph (A), by inserting
‘‘(other than the fourth sentence of subsection
(c))’’ after ‘‘(c)’’,
(B) by striking ‘‘and’’ at the end of sub-
paragraph (A),
(C) by striking the period at the end of sub-
paragraph (B) and inserting ‘‘, and’’, and
(D) by adding at the end the following new
subparagraph:
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‘‘(C) subsection (d)(3) shall apply.’’.
(b) LIMITING AMOUNT OF PAYMENT ADJUSTMENTS
FOR
STATE
OR
COUNTY
HOSPITALS
TO
UNCOVERED
COSTS.—Subsection (c) of section 1923 (42 U.S.C. 1396r–
4) is amended by adding at the end the following: ‘‘A pay-
ment adjustment during a year is not considered to be con-
sistent with this subsection with respect to a hospital owned
or operated by a State (or by an instrumentality of, or a
unit of government within, a State) if the payment adjust-
ment exceeds the costs incurred during the year of furnish-
ing hospital services (as determined by the Secretary and
net of payments under this title, other than under this sec-
tion, and by uninsured patients) by the hospital to individ-
uals who either are eligible for medical assistance under the
State plan or have no health insurance (or other source of
third party coverage) for services provided during the year.
For purposes of the preceding sentence, payments made to
a hospital for services provided to indigent patients made
by a State or a unit of local government within a State
shall not be considered to be a source of third party pay-
ment.’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to payments to States under section
1903(a) of the Social Security Act which are for payments
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to hospitals made under State plans after the end of the
State fiscal year that ends during 1995.
Subpart F—Anti-Fraud and Abuse Provisions
SEC. 7451. APPLICATION OF MEDICARE RULES LIMITING
CERTAIN PHYSICIAN REFERRALS.
(a) IN
GENERAL.—Section 1903(i) (42 U.S.C.
1396b(i)), as amended by subsection (b), is amended—
(1) in paragraph (12), by striking ‘‘or’’ at the
end,
(2) in paragraph (13), by striking the period at
the end and inserting ‘‘; or’’, and
(3) by inserting after paragraph (13) the follow-
ing new paragraph:
‘‘(14) with respect to any amount expended for
an item or service for which payment would be denied
under section 1877(g)(1) if the item or service were
furnished to an individual entitled to benefits under
title XVIII.’’.
(b) REDESIGNATIONS.—Section 1903(i) (42 U.S.C.
1396b(i)), as amended by section 2(b)(2) of the Medicaid
Voluntary Contribution and Provider-Specific Tax Amend-
ments of 1991, is amended—
(1) by redesignating the paragraph (12) inserted
by section 4752(a)(2) of OBRA–1990 as paragraph
(11), by transferring and inserting it after the para-
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graph (10) inserted by section 4401(a)(1)(B) of
OBRA–1990, and by striking the period at the end
and inserting a semicolon;
(2) by redesignating the paragraph (14) inserted
by section 4752(e) of OBRA–1990 as paragraph (12),
by transferring and inserting it after paragraph (11),
as redesignated by paragraph (2), and by striking the
period at the end and inserting ‘‘; or’’; and
(3) by redesignating the paragraph (11) inserted
by section 4801(e)(16)(A) of OBRA–1990 as para-
graph (13) and by transferring and inserting it after
paragraph (12), as redesignated by paragraph (3),
and by striking ‘‘; or’’ and inserting a period.
(c) EFFECTIVE DATE.—The amendment made by sub-
section (a) shall apply to items and services furnished on
or after October 1, 1993.
PART II—OTHER MEDICAID PROVISIONS
SEC. 7501. EXTENSION OF DEMONSTRATION PROJECT ON
THE EFFECT OF ALLOWING STATES TO EX-
TEND MEDICAID COVERAGE TO CERTAIN
LOW-INCOME FAMILIES.
(a) IN GENERAL.—Section 4745 of OBRA–1990 is
amended—
(1) in paragraph (1) of subsection (e), by strik-
ing ‘‘$12,000,000 in each of fiscal years 1991, 1992,
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and 1993, and to no more than $4,000,000 in fiscal
year 1994’’ and inserting ‘‘$40,000,000’’; and
(2) in paragraph (2) of subsection (f) by striking
‘‘January 1, 1995’’ and inserting ‘‘one year after the
termination of the projects’’.
(b) EFFECTIVE DATE.—The amendments made by
paragraph (1) shall take effect as if included in the enact-
ment of OBRA–1990.
Subtitle C—Income Security
Programs
SEC. 7601. MATCHING OF STATE ADMINISTRATIVE COSTS.
(a) AFDC MATCHING.—Section 403(a)(3) (42 U.S.C.
603(a)(3)) is amended to read as follows:
‘‘(3) in the case of any State, 50 percent of the
total amounts expended during such quarter as found
necessary by the Secretary for the proper and efficient
administration of the State plan, except that no pay-
ment shall be made with respect to amounts expended
in connection with the provision of any service de-
scribed in section 2002(a) of this Act other than serv-
ices furnished pursuant to section 402(g); and’’.
(b) TERRITORIAL PROGRAMS FOR AGED, BLIND, AND
DISABLED.—Sections 3(a)(4), 1003(a)(3), 1403(a)(3), and
1603(a)(4) (42 U.S.C. 303(a)(3), 1203(a)(3), 1353(a)(3),
and 1383 note) (as in effect as provided by section 303 of
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the Social Security Amendments of 1972) are each amended
by striking ‘‘the sum of’’ and all that follows and inserting
‘‘50 percent of the total amounts expended during such
quarter as found necessary by the Secretary for the proper
and efficient administration of the State plan.’’.
(c) REQUIREMENTS FOR ATTESTING TO CITIZENSHIP
STATUS.—Paragraph (1)(A) of section 1137(d) (42 U.S.C.
1320b–7(d)) is amended to read as follows:
‘‘(1)(A) The State shall require, as a condition
of an individual’s eligibility for benefits under a pro-
gram listed in subsection (b), a declaration in writ-
ing, under penalty of perjury—
‘‘(i) by the individual,
‘‘(ii) in the case in which eligibility for pro-
gram benefits is determined on a family or
household basis, by any adult member of such in-
dividual’s family or household (as applicable), or
‘‘(iii) in the case of an individual born into
a family or household receiving benefits under
such program, by any adult member of such
family or household no later than the next rede-
termination of eligibility of such family or
household following the birth of such individual,
stating whether the individual is a citizen or national
of the United States, and, if that individual is not a
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citizen or national of the United States, that the indi-
vidual is in a satisfactory immigration status.’’.
(d) EFFECTIVE DATES.—
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by—
(A) subsections (a) and (b) shall be effective
with respect to calendar quarters beginning on
or after April 1, 1994, and
(B) subsection (c) shall be effective on and
after the date of the enactment of this Act.
(2) SPECIAL RULE.—In the case of a State whose
legislature meets biennially, and does not have a reg-
ular session scheduled in calendar year 1994, the
amendments made by subsections (a) and (b) shall be
effective no later than the first day of the first cal-
endar quarter beginning after the close of the first
regular session of the State legislature that begins
after the date of enactment of this Act.
SEC. 7602. STATE PATERNITY ESTABLISHMENT PROGRAMS.
(a) PERFORMANCE STANDARDS FOR STATE PATER-
NITY ESTABLISHMENT PROGRAMS.— Section 452(g) (42
U.S.C. 652(g)) is amended—
(1) in paragraph (1)—
(A) by striking ‘‘1991’’ and inserting
‘‘1994’’;
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(B) by inserting ‘‘is based on reliable data
and’’ before ‘‘equals or exceeds’’; and
(C) by striking subparagraphs (A), (B), and
(C) and inserting the following new subpara-
graphs:
‘‘(A) 75 percent;
‘‘(B) for a State with a paternity establish-
ment percentage of not less than 50 percent but
less than 75 percent for such fiscal year, the pa-
ternity establishment percentage of the State for
the immediately preceding fiscal year plus 3 per-
centage points; or
‘‘(C) for a State with a paternity establish-
ment percentage of less than 50 percent for such
fiscal year, the paternity establishment percent-
age of the State for the immediately preceding
fiscal year plus 6 percentage points.’’; and
(2) in paragraph (2)—
(A) by striking ‘‘(or under all such plans)’’
each place it appears;
(B) by inserting ‘‘or part (E)’’ after ‘‘under
part A’’ each place it appears;
(C) by striking subparagraph (B) and in-
serting the following new subparagraph:
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‘‘(B) the term ‘reliable data’ means the most
recent data available which are found by the
Secretary to be reliable for purposes of this sec-
tion.’’;
(D) by inserting ‘‘unless paternity is estab-
lished for such child’’ after ‘‘the death of a par-
ent’’; and
(E) by inserting ‘‘or any child with respect
to whom the State agency administering the
plan under part E determines (as provided in
section 454(4)(B)) that it is against the best in-
terest of such child to do so’’ after ‘‘cooperate
under section 402(a)(26)’’.
(b) STATE PLAN REQUIREMENTS FOR THE ESTAB-
LISHMENT
OF PATERNITY.—Section 466(a) (42 U.S.C.
666(a)) is amended—
(1) in paragraph (2)—
(A) by striking ‘‘at the option of the State,’’;
and
(B) by inserting ‘‘or paternity establish-
ment’’ after ‘‘support order issuance and enforce-
ment’’;
(2) in paragraph (5) by adding at the end the
following new subparagraphs:
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‘‘(C) Procedures for a simple civil process
for voluntarily acknowledging paternity under
which the State must provide that the rights and
responsibilities of acknowledging paternity are
explained and ensure that due process safeguards
are afforded. Such procedures must include (i) a
hospital-based program for the voluntary ac-
knowledgment of paternity during the period im-
mediately preceding or following the birth of a
child, and (ii) the inclusion of signature lines on
applications for official birth certificates which,
once signed by the father and the mother, con-
stitute a voluntary acknowledgment of paternity.
‘‘(D) Procedures under which the voluntary
acknowledgment of paternity creates a rebuttable,
or at the option of the State, conclusive presump-
tion of paternity, and under which such vol-
untary acknowledgment is admissible as evidence
of paternity.
‘‘(E) Procedures under which the voluntary
acknowledgment of paternity must be recognized
as a basis for seeking a support order without
first requiring any further proceedings to estab-
lish paternity.
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‘‘(F) Procedures which provide that (i) any
objection to genetic testing results must be made
in writing within a specified number of days be-
fore any hearing at which such results may be
introduced into evidence, and (ii) if no objection
is made, the test results are admissible as evi-
dence of paternity without the need for founda-
tion testimony or other proof of authenticity or
accuracy.
‘‘(G) Procedures which create a rebuttable
or, at the option of the State, conclusive pre-
sumption of paternity upon genetic testing re-
sults indicating a threshold probability of the al-
leged father being the father of the child.
‘‘(H) Procedures requiring a default order
to be entered in a paternity case upon a showing
of service of process on the defendent and any
additional showing required by State law.’’; and
(3) by inserting after paragraph (10) the follow-
ing new paragraph:
‘‘(11) Procedures under which a State must give
full faith and credit to a determination of paternity
made by any other State, whether established through
voluntary acknowledgment or through administrative
or judicial processes.’’.
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(c) EFFECTIVE DATE.—The amendments made by this
section shall become effective with respect to a State on the
later of—
(1) October 1, 1993 or,
(2) the date of enactment by the legislature of
such State of all laws required by such amendments,
but in no event later than the first day of the first calendar
quarter beginning after the close of the first regular session
of the State legislature that begins after the date of enact-
ment of this Act. For purposes of the previous sentence, in
the case of a State that has a 2-year legislative session, each
year of such session shall be deemed to be a separate regular
session of the State legislature.
SEC. 7603. FEES FOR FEDERAL ADMINISTRATION OF STATE
SUPPLEMENTARY PAYMENTS.
(a) IN GENERAL.—
(1) OPTIONAL
STATE
SUPPLEMENTARY
PAY-
MENTS.—Section 1616(d) (42 U.S.C. 1382e(d)) is
amended—
(A) by inserting ‘‘(1)’’ after ‘‘(d)’’;
(B) by inserting ‘‘, plus an administration
fee assessed in accordance with paragraph (2)
and any additional services fee charged in ac-
cordance with paragraph (3)’’ before the period;
and
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(C) by adding after and below the end the
following:
‘‘(2)(A) The Secretary shall assess each State an ad-
ministration fee in an amount equal to—
‘‘(i) the number of supplementary payments
made by the Secretary on behalf of the State under
this section for any month in a fiscal year; multiplied
by
‘‘(ii) the applicable rate for the fiscal year.
‘‘(B) As used in subparagraph (A), the term ‘applica-
ble rate’ means—
‘‘(i) for fiscal year 1995, $1.67;
‘‘(ii) for fiscal year 1996, $3.33;
‘‘(iii) for fiscal year 1997, $5.00; and
‘‘(iv) for fiscal year 1998 and each succeeding
fiscal year, $5.00, or such different rate as the Sec-
retary determines pursuant to criteria established in
regulations is appropriate for the State, taking into
account the complexity of the State’s supplementary
payment program.
‘‘(C) All fees collected pursuant to this paragraph shall
be transferred to the United States at the same time that
amounts for such supplementary payments are required to
be so transferred.
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‘‘(3)(A) The Secretary shall charge a State an addi-
tional services fee if, at the request of the State, the Sec-
retary provides additional services beyond the level cus-
tomarily provided, in the administration of State supple-
mentary payments pursuant to this section.
‘‘(B) The additional services fee shall be in an amount
that the Secretary determines is necessary to cover all costs
(including indirect costs) incurred by the Federal Govern-
ment in furnishing the additional services referred to in
subparagraph (A).
‘‘(C) The additional services fee shall be payable in
advance or by way of reimbursement.
‘‘(4) All administration fees and additional services
fees collected pursuant to this subsection shall be deposited
in the general fund of the Treasury of the United States
as miscellaneous receipts.’’.
(2) MANDATORY
STATE
SUPPLEMENTARY
PAY-
MENTS.—Section 212(b)(3) of Public Law 93–66 (42
U.S.C. 1382 note) is amended—
(A) by inserting ‘‘(A)’’ after ‘‘(3)’’;
(B) by inserting ‘‘, plus an administration
fee assessed in accordance with subparagraph
(B) and any additional services fee charged in
accordance with subparagraph (C)’’ before the
period; and
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(C) by adding after and below the end the
following:
‘‘(B)(i) The Secretary shall assess each State an ad-
ministration fee in an amount equal to—
‘‘(I) the number of supplementary payments
made by the Secretary on behalf of the State under
this subsection for any month in a fiscal year; multi-
plied by
‘‘(II) the applicable rate for the fiscal year.
‘‘(ii) As used in clause (i), the term ‘applicable rate’
means—
‘‘(I) for fiscal year 1995, $1.67;
‘‘(II) for fiscal year 1996, $3.33;
‘‘(III) for fiscal year 1997, $5.00; and
‘‘(IV) for fiscal year 1998 and each succeeding
fiscal year, $5.00, or such different rate as the Sec-
retary determines pursuant to regulations established
in regulations is appropriate for the State, taking
into account the complexity of the State’s supple-
mentary payment program.
‘‘(iii) All fees collected pursuant to this subparagraph
shall be transferred to the United States at the same time
that amounts for such supplementary payments are re-
quired to be so transferred.
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‘‘(C)(i) The Secretary shall charge a State an addi-
tional services fee if, at the request of the State, the Sec-
retary provides additional services beyond the level cus-
tomarily provided, in the administration of State supple-
mentary payments pursuant to this subsection.
‘‘(ii) The additional services fee shall be in an amount
that the Secretary determines is necessary to cover all costs
(including indirect costs) incurred by the Federal Govern-
ment in furnishing the additional services referred to in
clause (i).
‘‘(iii) The additional services fee shall be payable in
advance or by way of reimbursement.
‘‘(D) All administration fees and additional services
fees collected pursuant to this paragraph shall be deposited
in the general fund of the Treasury of the United States
as miscellaneous receipts.’’.
(b) EFFECTIVE DATE.—The amendments made by this
section shall apply to supplementary payments made pur-
suant to section 1616(a) of the Social Security Act or sec-
tion 212(a) of Public Law 93–66 for any calendar month
beginning after September 30, 1994, and to services fur-
nished after such date, regardless of whether regulations to
implement such amendments have been promulgated by
such date, or whether any agreement entered into under
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such section 1616(a) or such section 212(a) has been modi-
fied.
Subtitle D—Miscellaneous
Provisions
PART I—TRADE PROVISIONS
SEC. 7701. EXTENSION OF AUTHORITY TO LEVY CUSTOMS
USER FEES.
Section 13031(j)(3) of the Consolidated Omnibus
Budget Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3)) is
amended by striking out ‘‘1995’’ and inserting ‘‘1998’’.
SEC. 7702. EXTENSION OF, AND AUTHORIZATION OF APPRO-
PRIATIONS FOR, TRADE ADJUSTMENT AS-
SISTANCE PROGRAM.
(a) EXTENSION.—Section 285 of the Trade Act of 1974
(19 U.S.C. 2271, preceding note) is amended—
(1) by striking ‘‘No’’ and all that follows through
‘‘and no duty’’ in subsection (b) and inserting ‘‘No
duty’’; and
(2) by adding at the end the following new sub-
section:
‘‘(c) No assistance, vouchers, allowances, or other pay-
ments may be provided under chapter 2, and no technical
assistance may be provided under chapter 3, after Septem-
ber 30, 1998.’’.
(b) AUTHORIZATION OF APPROPRIATIONS.—
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(1) CHAPTER 2 ADJUSTMENT ASSISTANCE.—Sec-
tion 245 of the Trade Act of 1974 (19 U.S.C. 2317)
is amended by striking ‘‘1988, 1989, 1990, 1991,
1992, and 1993’’ and inserting ‘‘1993, 1994, 1995,
1996, 1997, and 1998’’.
(2) CHAPTER 3 ADJUSTMENT ASSISTANCE.—Sec-
tion 256(b) of such Act (19 U.S.C. 2346(b)) is amend-
ed by striking ‘‘1988, 1989, 1990, 1991, 1992, and
1993’’ and inserting ‘‘1993, 1994, 1995, 1996, 1997,
and 1998’’.
PART II—IMPROVED ACCESS TO CHILDHOOD
IMMUNIZATIONS
SEC. 7801. REIMBURSEMENT TO VACCINE MANUFACTUR-
ERS.
(a) IN GENERAL.—Section 1902(a)(32) (42 U.S.C.
1396a(32)) is amended—
(1) by striking ‘‘and’’ at the end of subpara-
graph (B);
(2) by striking the period at the end of subpara-
graph (C) and inserting ‘‘; and’’; and
(3) by adding at the end the following new sub-
paragraph:
‘‘(D) nothing in this paragraph shall be
construed to prevent the making of such payment
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to a manufacturer of a childhood vaccine under
a contract with the State pursuant to which the
manufacturer participates in a vaccine replace-
ment program described in subsection (z).’’.
(b) STATE VACCINE BULK PURCHASE PROGRAM.—
Section 1902 (42 U.S.C. 1396a) is amended by adding after
paragraph (58) the following new paragraph:
‘‘(59) provide for the establishment of a State
vaccine bulk purchase program for the purchase of pe-
diatric vaccines.’’
and by adding at the end the following new subsection:
‘‘(z)(1) For purposes of section 1396a(a)(59), a vaccine
replacement program described in this subsection is a vac-
cine bulk purchase program under which a State with a
State plan approved under this title contracts with each
manufacturer of childhood vaccines selling such vaccines in
the State to—
‘‘(A) supply doses of childhood vaccines to pro-
viders (or in the case of a State medicaid vaccine pro-
gram, the State) administering such vaccines to indi-
viduals eligible to receive medical assistance under the
State plan and replace such vaccines as needed; and
‘‘(B) charge the State agency for such doses of
childhood vaccine the price under the most recent bid
(determined once such a bid price is made public)
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submitted by a manufacturer which receives the Cen-
ters for Disease Control and Prevention contract with
respect to the childhood immunization program under
the Public Health Services Act, plus a reasonable fee
to cover shipping and handling of returns for such
doses.
‘‘(2) Any manufacturer of childhood vaccines selling
such vaccines in a State which does not participate in a
vaccine replacement program described in paragraph (1)
which is operated in such State shall be ineligible to bid
for Centers for Disease Control and Prevention Immuniza-
tion contracts under section 317(j) of the Public Health
Services Act.’’.
(c) DEFINITION OF STATE VACCINE BULK PURCHASE
PROGRAM.—Section 1902 (42 U.S.C. 1396d) is amended by
adding at the end the following new subsection:
‘‘(t) VACCINE BULK PURCHASE PROGRAM.—The term
‘vaccine bulk purchase program’ means a State program
which purchases vaccines at prices negotiated by the Centers
for Disease Control and Prevention’s childhood immuniza-
tion program and distributes such vaccines free of charge
to entities providing medical assistance to individuals eligi-
ble for such medical assistance under this title.’’.
(d) 
AGREEMENT
WITH
THE
STATE.—Section
1902(a)(27) (42 U.S.C. 1396a(a)(27)) is amended—
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(1) by striking ‘‘under the State plan’’, and in-
serting ‘‘under the State plan and with any entity
that is a manufacturer of a childhood vaccine under
a contract with the State pursuant to which the man-
ufacturer participates in a vaccine replacement pro-
gram described in subsection (z)’’; and
(2) by striking ‘‘such person or institution’’ each
place it appears and inserting ‘‘such person, institu-
tion, or entity’’.
(e) CDC PRICE PLUS CPI.—To the extent that, at the
date of enactment, a specific vaccine is purchased under
contract with the Centers for Disease Control and Preven-
tion as provided in the Public Health Service Act, no bid
for the purchase of such vaccine shall be accepted by the
Centers for Disease Control and Prevention if the price per
dose of such vaccine exceeds the price in effect on the date
of enactment increased by the percentage increase in CPI
from date of the contract in effect on the date of the enact-
ment to the date of the contract. This provision shall be
in effect for contracts made in fiscal year 1994 through fis-
cal year 1998.
(f) MULTIPLE SUPPLIERS.—The Public Health Service
provisions relating to the Centers for Disease Control and
Prevention purchase of vaccine may not be construed as
prohibiting the Secretary from entering into a contract