IB 
Union Calendar No. 570 
114TH CONGRESS 
2D SESSION 
H. R. 670 
[Report No. 114–734] 
To amend title XIX of the Social Security Act to extend the Medicaid 
rules regarding supplemental needs trusts for Medicaid beneficiaries to 
trusts established by those beneficiaries, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
FEBRUARY 3, 2015 
Mr. THOMPSON of Pennsylvania (for himself and Mr. PALLONE) introduced 
the following bill; which was referred to the Committee on Energy and 
Commerce 
SEPTEMBER 9, 2016 
Additional sponsors: Mr. HARPER, Ms. SLAUGHTER, Mr. LOEBSACK, Mr. 
RUSH, Mr. KELLY of Pennsylvania, Mr. MARINO, Mr. HANNA, Mr. 
BARLETTA, Mr. HUFFMAN, Ms. SCHAKOWSKY, Mr. PASCRELL, Mr. BLU-
MENAUER, Ms. KUSTER, Mr. MURPHY of Pennsylvania, Mr. KATKO, Mr. 
DESAULNIER, Mr. ISRAEL, Mr. KENNEDY, Mr. LANCE, Mr. RUPPERS-
BERGER, Mrs. MCMORRIS RODGERS, Mr. HUDSON, Mr. CRAMER, Mr. 
FRELINGHUYSEN, Mr. WALBERG, Mr. BISHOP
of Michigan, Mr. 
FITZPATRICK, Mr. COSTELLO of Pennsylvania, Mrs. COMSTOCK, Mr. 
AMODEI, Mr. GIBSON, Mr. YOUNG of Alaska, Mr. BENISHEK, Mr. GIBBS, 
Mr. SESSIONS, Mr. LANGEVIN, Mr. LONG, Mr. RODNEY DAVIS of Illinois, 
Mr. KLINE, Mr. HECK of Nevada, Mr. WESTERMAN, Mr. BILIRAKIS, Mr. 
HARDY, Mr. FLEISCHMANN, Mr. CICILLINE, Mr. MCKINLEY, Ms. 
WASSERMAN SCHULTZ, Mr. POCAN, Mr. DONOVAN, and Mr. SMITH of 
New Jersey 
SEPTEMBER 9, 2016 
Reported with an amendment, committed to the Committee of the Whole 
House on the State of the Union, and ordered to be printed 
[Strike out all after the enacting clause and insert the part printed in italic] 
[For text of introduced bill, see copy of bill as introduced on February 3, 2015] 
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A BILL 
To amend title XIX of the Social Security Act to extend 
the Medicaid rules regarding supplemental needs trusts 
for Medicaid beneficiaries to trusts established by those 
beneficiaries, and for other purposes. 
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Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Special Needs Trust Fairness and Medicaid Improvement 
Act’’. 
(b) TABLE OF CONTENTS.—The table of contents of this 
Act is as follows: 
Sec. 1. Short title; table of contents. 
Sec. 2. Fairness in Medicaid supplemental needs trusts. 
Sec. 3. Medicaid coverage of tobacco cessation services for mothers of newborns. 
Sec. 4. Eliminating Federal financial participation with respect to expenditures 
under Medicaid for agents used for cosmetic purposes or hair 
growth. 
Sec. 5. Medicaid Improvement Fund. 
SEC. 2. FAIRNESS IN MEDICAID SUPPLEMENTAL NEEDS 
TRUSTS. 
(a) IN GENERAL.—Section 1917(d)(4)(A) of the Social 
Security Act (42 U.S.C. 1396p(d)(4)(A)) is amended by in-
serting ‘‘the individual,’’ after ‘‘for the benefit of such indi-
vidual by’’. 
(b) EFFECTIVE DATE.—The amendment made by sub-
section (a) shall apply to trusts established on or after the 
date of the enactment of this Act. 
SEC. 3. MEDICAID COVERAGE OF TOBACCO CESSATION 
SERVICES FOR MOTHERS OF NEWBORNS. 
(a) IN GENERAL.—Section 1905(bb) of the Social Se-
curity Act (42 U.S.C. 1396d(bb)) is amended by adding at 
the end the following new paragraph: 
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‘‘(4) A woman shall continue to be treated as described 
in this subsection as a pregnant woman through the end 
of the 1-year period beginning on the date of the birth of 
a child of the woman.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Subsections (a)(2)(B) and (b)(2)(B) of sec-
tion 1916 of the Social Security Act (42 U.S.C. 
1396o) are each amended by inserting ‘‘(and women 
described in section 1905(bb) as pregnant women pur-
suant to paragraph (4) of such section)’’ after ‘‘to-
bacco cessation by pregnant women’’. 
(2) Section 1927(d)(2)(F) of the Social Security 
Act (42 U.S.C. 1396r–8(d)(2)(F)) is amended by in-
serting ‘‘(and women described in section 1905(bb) as 
pregnant women pursuant to paragraph (4) of such 
section)’’ after ‘‘pregnant women’’. 
(c) EFFECTIVE DATE.— 
(1) IN GENERAL.—Subject to paragraph (2), the 
amendments made by this section shall apply with re-
spect to items and services furnished on or after the 
date that is two years after the date of the enactment 
of this Act. 
(2) EXCEPTION
FOR
STATE
LEGISLATION.—In 
the case of a State plan under title XIX of the Social 
Security Act, which the Secretary of Health and 
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Human Services determines requires State legislation 
in order for the plan to meet any requirement im-
posed by amendments made by this section, the plan 
shall not be regarded as failing to comply with the re-
quirements of such title solely on the basis of its fail-
ure to meet such an additional requirement before the 
first day of the first calendar quarter beginning after 
the close of the first regular session of the State legis-
lature that begins after the effective date specified in 
paragraph (1). For purposes of the previous sentence, 
in the case of a State that has a 2-year legislative ses-
sion, each year of the session shall be considered to be 
a separate regular session of the State legislature. 
(d) REPORT.—Not later than two years after the date 
of the enactment of this Act, the Inspector General of the 
Department of Health and Human Services shall submit 
to Congress a report that assesses the use of the tobacco ces-
sation service benefit under the Medicaid program. Such re-
port shall include an assessment of— 
(1) the extent that States are encouraging the use 
of such benefit, such as through promotion of bene-
ficiary and provider awareness of such benefit; and 
(2) gaps in the delivery of such benefit. 
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