Stabilize Medicaid and CHIP Coverage Act of 2021
Bill: S.646 | Sponsor: Sen. Brown, Sherrod (D-OH)
Policy area: Health

Summary:
Stabilize Medicaid and CHIP Coverage Act of 2021
This bill requires the Children's Health Insurance Program (CHIP) and state Medicaid programs to provide 12-month continuous enrollment for eligible individuals.
The bill also establishes bonus payments for states that implement certain Medicaid enrollment and retention policies for specified categories of individuals (e.g., children), such as aligning income eligibility standards with those of other insurance affordability programs.

To amend titles XIX and XXI of the Social Security Act to provide for 
12-month continuous enrollment under Medicaid and the Children's Health 
               Insurance Program, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Stabilize Medicaid and CHIP Coverage 
Act of 2021''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) Every year millions of people are enrolled in Medicaid 
        and the Children's Health Insurance Program (in this section 
        referred to as ``CHIP''), but subsequently lose their coverage, 
        despite still being eligible, because of inefficient and 
        cumbersome paperwork and logistical requirements.
            (2) Data show that the typical enrollee receives Medicaid 
        coverage for about \3/4\ of the year and that coverage periods 
        are lower for non-elderly, non-disabled adults than for those 
        with disabilities, seniors, and children.
            (3) Medicaid enrollees with coverage disruption are more 
        likely to be hospitalized for illnesses, like asthma, diabetes, 
        or cardiovascular disease, that can be effectively managed 
        through ongoing primary medical care and medication, are less 
        likely to be screened for breast cancer, and may have poorer 
        cancer outcomes.
            (4) Children enrolled in CHIP also experience disruptions 
        in health coverage and care. For example, during just a 1-year 
        period, over \1/3\ of CHIP enrollees were also enrolled in a 
        State's Medicaid program. Transitions between Medicaid and CHIP 
        can cause disruptions in care because the health care coverage 
        and participating providers vary between the two programs.
            (5) Interruptions in coverage can impair the receipt of 
        effective primary care and lead to expensive hospitalizations 
        or emergency room visits.
            (6) Unnecessary enrollment, disenrollment, and reenrollment 
        in Medicaid and CHIP result in higher administrative expenses 
        for reenrollment and result in more people uninsured at any 
        given time.
            (7) Stable coverage under Medicaid and CHIP lowers average 
        monthly medical costs. Continuous enrollment also permits 
        better prevention and disease management, leading to fewer 
        serious illnesses and hospitalizations.
            (8) Children with stable coverage are less likely to have 
        unmet medical needs, allowing children to receive the 
        preventive care that is necessary to help them grow into 
        healthy adults.

SEC. 3. 12-MONTH CONTINUOUS ENROLLMENT.

    (a) Requirement of 12-Month Continuous Enrollment Under Medicaid.--
            (1) In general.--Section 1902(e)(12) of the Social Security 
        Act (42 U.S.C. 1396a(e)), is amended to read as follows:
            ``(12) 12-month continuous enrollment.--
                    ``(A) In general.--Notwithstanding any other 
                provision of this title, a State plan approved under 
                this title or under any waiver of such plan approved 
                pursuant to section 1115 or section 1915, shall provide 
                that an individual who is determined to be eligible for 
                benefits under such plan (or waiver) shall be 
                considered to meet the eligibility requirements met on 
                the date of application and shall remain eligible and 
                enrolled for such benefits through the end of the month 
                in which the 12-month period (beginning on the date of 
                determination of eligibility) ends.
                    ``(B) Promoting retention of eligible and enrolled 
                persons beyond 12 months.--The Secretary shall--
                            ``(i) identify methods that promote the 
                        retention of individuals who are enrolled under 
                        the State plan or under a waiver of such plan 
                        and who remain eligible for medical assistance 
                        beyond the 12-month period described in 
                        subparagraph (A); and
                            ``(ii) actively promote the adoption of 
                        such enrollment retention methods by States, 
                        which shall include, but not be limited to, 
                        issuing guidance and developing resources on 
                        State best practices.
                    ``(C) Enrollment and retention reporting.--
                            ``(i) In general.--Not later than 1 year 
                        after the date of enactment of the Stabilize 
                        Medicaid and CHIP Coverage Act of 2021, the 
                        Secretary shall publish the procedures that 
                        States are expected to use to provide annual 
                        enrollment and retention reports beginning not 
                        later than 2 years after the date of enactment 
                        of such Act.
                            ``(ii) State reporting requirements.--At a 
                        minimum, the reporting procedures published 
                        under clause (i) shall include a description of 
                        State eligibility criteria and enrollment 
                        procedures under this title and data regarding 
                        enrollment and retention using standardized 
                        reporting formats determined by the Secretary.
                            ``(iii) Secretary report and publication.--
                                    ``(I) In general.--The Secretary 
                                annually shall publish enrollment and 
                                retention performance results for all 
                                States not later than 6 months after 
                                the deadline for each annual State 
                                enrollment and retention reporting 
                                period.
                                    ``(II) Estimated enrollment 
                                continuity ratios.--Each annual report 
                                published by the Secretary under 
                                subclause (I) shall include estimates 
                                of Medicaid enrollment continuity 
                                ratios for each State in accordance 
                                with the requirements of subclause 
                                (III).
                                    ``(III) Requirements.--The 
                                Secretary shall develop both overall 
                                enrollment continuity ratios for all 
                                enrollees and separate enrollment 
                                continuity ratios for each of the 
                                following categories:
                                            ``(aa) Children.
                                            ``(bb) Individuals whose 
                                        eligibility category is related 
                                        to having attained age 65.
                                            ``(cc) Individuals whose 
                                        eligibility category is related 
                                        to disability or blindness.
                                            ``(dd) Individuals whose 
                                        eligibility category is related 
                                        to their status as parents and 
                                        caretaker relatives of children 
                                        under 19 or who are otherwise 
                                        not elderly, blind or disabled 
                                        adults.''.
    (b) Requirement of 12-Month Continuous Enrollment Under CHIP.--
            (1) In general.--Section 2102(b) of the Social Security Act 
        (42 U.S.C. 1397bb(b)) is amended by adding at the end the 
        following new paragraph:
            ``(6) Requirement for 12-month continuous enrollment.--
        Notwithstanding any other provision of this title, a State 
        child health plan that provides child health assistance under 
        this title through a means other than that described in section 
        2101(a)(2), shall provide that an individual who is determined 
        to be eligible for benefits under such plan shall be considered 
        to meet the eligibility requirements met on the date of 
        application and shall remain eligible and enrolled for such 
        benefits through the end of the month in which the 12-month 
        period (beginning on the date of determination of eligibility) 
        ends.''.
            (2) Conforming amendments.--
                    (A) Enrollment and retention provisions.--Section 
                2105(a)(4)(A) of the Social Security Act (42 U.S.C. 
                1397ee(a)(4)(A)) is amended--
                            (i) by striking ``has elected the option 
                        of'' and inserting ``is in compliance with the 
                        requirement for''; and
                            (ii) by striking ``applying such policy 
                        under its State child health plan under this 
                        title'' and inserting ``in compliance with 
                        section 2102(b)''.
                    (B) Application of medicaid retention and reporting 
                requirements.--Section 2107(e)(1) of the Social 
                Security Act (42 U.S.C. 1397gg(e)(1)) is amended--
                            (i) by redesignating subparagraphs (H) 
                        through (S) as subparagraphs (I) through (T), 
                        respectively; and
                            (ii) by inserting after subparagraph (G), 
                        the following:
                    ``(H) Subparagraphs (B) and (C) of section 
                1902(e)(12) (relating to promotion of enrollment beyond 
                12 months and reporting requirements)(without regard to 
                items (bb), (cc), and (dd) of subparagraph 
                (C)(iii)(III) of that section).''.
    (c) Effective Date.--
            (1) In general.--Except as provided in paragraph (2) or 
        (3), the amendments made by subsections (a) and (b) shall apply 
        to determinations (and redeterminations) of eligibility made on 
        or after the date that is 18 months after the date of the 
        enactment of this Act.
            (2) Extension of effective date for state law amendment.--
        In the case of a State plan under title XIX or State child 
        health plan under title XXI of the Social Security Act (42 
        U.S.C. 1396 et seq.; 42 U.S.C. 1397aa et seq.) which the 
        Secretary of Health and Human Services determines requires 
        State legislation (other than legislation appropriating funds) 
        in order for the respective plan to meet the additional 
        requirements imposed by the amendments made by subsections (a) 
        or (b), respectively, the respective plan shall not be regarded 
        as failing to comply with the requirements of such title solely 
        on the basis of its failure to meet such applicable 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 previous sentence, in the case of 
        a State that has a 2-year legislative session, each year of the 
        session is considered to be a separate regular session of the 
        State legislature.
            (3) Option to implement 12-month continuous eligibility 
        prior to effective date.--A State may elect through a State 
        plan amendment under title XIX or XXI of the Social Security 
        Act (42 U.S.C. 1396 et seq.; 42 U.S.C. 1397aa et seq.) to apply 
        the amendments made by subsection (a) or (b), respectively, on 
        any date prior to the 18-month date specified in paragraph (1), 
        but not sooner than the date of the enactment of this Act.

SEC. 4. PREVENTING THE APPLICATION UNDER CHIP OF COVERAGE WAITING 
              PERIODS.

    (a) In General.--Section 2102(b)(1)(B) of the Social Security Act 
(42 U.S.C. 1397bb(b)(1)(B)) is amended--
            (1) in clause (iii)--
                    (A) by striking ``in the case of'' and inserting 
                ``in the case of a targeted low-income child (including 
                a child provided dental-only supplemental coverage 
                under section 2110(b)(5)) or in the case of''; and
                    (B) by adding ``and'' after the semicolon;
            (2) by striking clause (iv); and
            (3) by redesignating clause (v) as clause (iv).
    (b) Conforming Amendments.--Section 2105(c)(10) of the Social 
Security Act (42 U.S.C. 1397ee(c)(10)) is amended by striking 
subparagraph (F) and redesignating subparagraphs (G) through (M) as 
subparagraphs (F) through (L), respectively.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the date of enactment of this Act.

SEC. 5. MEDICAID PERFORMANCE BONUSES FOR ENROLLMENT AND RETENTION 
              IMPROVEMENTS FOR CERTAIN INDIVIDUALS.

    Section 1903 of the Social Security Act (42 U.S.C. 1396b) is 
amended by adding at the end the following new subsection:
    ``(cc) Performance Bonuses for Enrollment and Retention of Low-
Income Individuals.--
            ``(1) In general.--A State may qualify for performance 
        bonuses related to the enrollment and retention of individuals 
        (including children) described in section 
        1902(e)(12)(C)(iii)(III). For purposes of this paragraph, a 
        State meets the condition of this paragraph for such 
        individuals if, for each category of individuals specified in 
        section 1902(e)(12)(C)(iii)(III), the State is implementing at 
        least 3 of the following enrollment and retention provisions 
        (treating each subparagraph as a separate enrollment and 
        retention provision) throughout the entire fiscal year:
                    ``(A) Aligning treatment of income under medicaid 
                with that of other insurance affordability programs.--
                The State implements policies, including prorating 
                income over annual periods, so as to align its 
                treatment of income for purposes of a determination of 
                eligibility for medical assistance with that of other 
                affordability insurance programs with the goal of 
                eliminating inconsistent determinations among these 
                programs.
                    ``(B) Maintaining coverage for individuals during 
                periods of transition.--The State implements the 
                following policies:
                            ``(i) In general.--Upon determination that 
                        an individual is no longer eligible for medical 
                        assistance, the State implements policies to 
                        maintain eligibility for medical assistance, 
                        including enrollment in the managed care 
                        organization in which the individual was 
                        enrolled at the time of the determination of 
                        ineligibility, during the period of time in 
                        which--
                                    ``(I) eligibility-related 
                                information is transmitted to the other 
                                insurance affordability programs;
                                    ``(II) a determination is made as 
                                to for which other insurance 
                                affordability program the individual is 
                                eligible, if any; and
                                    ``(III) coverage in such program 
                                and any related managed care 
                                organization becomes effective.
                            ``(ii) Managed care organization 
                        continuity.--The State implements policies to 
                        enroll the individual in the managed care 
                        organization in which the individual was a 
                        member prior to the loss of medical assistance 
                        eligibility, if such managed care organization 
                        participates in the other insurance 
                        affordability program, unless the individual 
                        voluntarily selects a separate managed care 
                        organization.
                    ``(C) Enhanced data-sharing between the state and 
                an american health benefit exchange and agencies.--The 
                State utilizes findings from an American Health Benefit 
                Exchange, an Express Lane Agency (as identified by the 
                State and as described in section 1902(e)(13)(F)), the 
                Social Security Administration, or other agencies 
                administering employment, educational, or social 
                services programs as identified by the State, to 
                document income, residency, age, or other relevant 
                information in determining or renewing eligibility.
                    ``(D) Eligibility based on pending status.--The 
                State maintains eligibility for enrollees whose renewal 
                status has not yet been determined and for whom 
                eligibility based on alternative eligibility criteria 
                has not yet been ruled out.
                    ``(E) Default reenrollment in managed care 
                organization.--In the case of individuals who are 
                determined to be eligible for medical assistance under 
                this title after the loss of eligibility for fewer than 
                6 months, and who previously had been members of a 
                managed care organization, the State re-enrolls the 
                individual in the managed care organization in which 
                the individual was a member prior to the loss of 
                eligibility, unless the individual voluntarily selects 
                a separate managed care organization.
            ``(2) Performance bonus payment to support 12-month 
        continuous enrollment for medicaid enrollees.--
                    ``(A) Authority to make bonus payments.--
                            ``(i) In general.--The Secretary shall make 
                        a bonus payment for fiscal years beginning with 
                        the first fiscal year that begins on or after 
                        the date that is 3 years after the date of 
                        enactment of the Stabilize Medicaid and CHIP 
                        Coverage Act of 2021, and annually thereafter 
                        to the extent there are funds available under 
                        paragraph (3)(A), to each State that satisfies 
                        the requirements of subparagraph (B).
                            ``(ii) Regulations.--Payments to States 
                        under this subsection for a fiscal year shall 
                        be allocated annually among eligible States in 
                        accordance with regulations promulgated by the 
                        Secretary not later than the date that is 6 
                        months prior to October 1 of the first fiscal 
                        year for which payments are made under this 
                        paragraph.
                            ``(iii) Timing.--A payment to a State under 
                        this subsection for a fiscal year shall be made 
                        as a single payment not later than the last day 
                        of the first calendar quarter of the succeeding 
                        fiscal year.
                    ``(B) State eligibility for bonus payments.--A 
                State shall be eligible for bonus payments under this 
                subsection if--
                            ``(i) the State has adopted at least 3 of 
                        the 5 policies described in subparagraphs (A) 
                        through (E) of paragraph (1) for each category 
                        of individuals specified in section 
                        1902(e)(12)(C)(iii)(III); and
                            ``(ii) the State is able to demonstrate 
                        improvement in the continuity of enrollment by 
                        child, aged, blind, and disabled, and adult 
                        populations, compared to the State's baseline 
                        performance with respect to continuity of 
                        enrollment for such populations in fiscal year 
                        2021 or such later year as the Secretary, by 
                        regulation, shall specify.
            ``(3) Amounts available for payments.--
                    ``(A) In general.--The total amount of bonus 
                payments made under this subsection for all fiscal 
                years shall be equal to $500,000,000, to be available 
                until expended.
                    ``(B) Budget authority.--This paragraph constitutes 
                budget authority in advance of appropriations Acts and 
                represents the obligation of the Secretary to provide 
                for the payment of amounts provided under this 
                paragraph.
            ``(4) Uses of enrollment and retention performance 
        bonuses.--Nothing in this subsection shall prohibit a State 
        from establishing criteria which would permit the State to 
        distribute a portion of the proceeds of any bonus payments 
        received pursuant to this subsection to financially support 
        providers and managed care entities participating under the 
        State plan or under a waiver of such plan who have contributed 
        to improved enrollment and retention activities.''.
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