To amend title XXI of the Social Security Act to extend the availability of allotments for fiscal years 1998 through 2001 under the State Children's Health Insurance Program, and for other purposes.
PL 108-74 (H.R.2854), enacted 08/15/2003

117 STAT. 892
PUBLIC LAW 108–74—AUG. 15, 2003
Public Law 108–74
108th Congress
An Act
To amend title XXI of the Social Security Act to extend the availability of allotments
for fiscal years 1998 through 2001 under the State 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. EXTENSION OF AVAILABILITY OF SCHIP ALLOTMENTS FOR
FISCAL YEARS 1998 THROUGH 2001.
(a) EXTENDING
AVAILABILITY
OF
SCHIP ALLOTMENTS
FOR
FISCAL YEARS 1998 THROUGH 2001.—
(1) RETAINED AND REDISTRIBUTED ALLOTMENTS FOR FISCAL
YEARS 1998 AND 1999.—Paragraphs (2)(A)(i) and (2)(A)(ii) of sec-
tion 2104(g) of the Social Security Act (42 U.S.C. 1397dd(g))
are each amended by striking ‘‘fiscal year 2002’’ and inserting
‘‘fiscal year 2004’’.
(2) EXTENSION AND REVISION OF RETAINED AND REDISTRIB-
UTED ALLOTMENTS FOR FISCAL YEAR 2000.—
(A) PERMITTING AND EXTENDING RETENTION OF PORTION
OF FISCAL YEAR 2000 ALLOTMENT.—Paragraph (2) of such
section 2104(g) is amended—
(i) in the heading, by striking ‘‘AND
1999’’ and
inserting ‘‘THROUGH 2000’’; and
(ii) by adding at the end of subparagraph (A) the
following:
‘‘(iii) FISCAL
YEAR
2000
ALLOTMENT.—Of the
amounts allotted to a State pursuant to this section
for fiscal year 2000 that were not expended by the
State by the end of fiscal year 2002, 50 percent of
that amount shall remain available for expenditure
by the State through the end of fiscal year 2004.’’.
(B) REDISTRIBUTED
ALLOTMENTS.—Paragraph (1) of
such section 2104(g) is amended—
(i) in subparagraph (A), by inserting ‘‘or for fiscal
year 2000 by the end of fiscal year 2002,’’ after ‘‘fiscal
year 2001,’’;
(ii) in subparagraph (A), by striking ‘‘1998 or 1999’’
and inserting ‘‘1998, 1999, or 2000’’;
(iii) in subparagraph (A)(i)—
(I) by striking ‘‘or’’ at the end of subclause
(I),
(II) by striking the period at the end of sub-
clause (II) and inserting ‘‘; or’’; and
(III) by adding at the end the following new
subclause:
Aug. 15, 2003
[H.R. 2854]
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117 STAT. 893
PUBLIC LAW 108–74—AUG. 15, 2003
‘‘(III) the fiscal year 2000 allotment, the
amount specified in subparagraph (C)(i) (less the
total of the amounts under clause (ii) for such
fiscal year), multiplied by the ratio of the amount
specified in subparagraph (C)(ii) for the State to
the amount specified in subparagraph (C)(iii).’’;
(iv) in subparagraph (A)(ii), by striking ‘‘or 1999’’
and inserting ‘‘, 1999, or 2000’’;
(v) in subparagraph (B), by striking ‘‘with respect
to fiscal year 1998 or 1999’’;
(vi) in subparagraph (B)(ii)—
(I) by inserting ‘‘with respect to fiscal year
1998, 1999, or 2000,’’ after ‘‘subsection (e),’’; and
(II) by striking ‘‘2002’’ and inserting ‘‘2004’’;
and
(vii) by adding at the end the following new
subparagraph:
‘‘(C) AMOUNTS USED IN COMPUTING REDISTRIBUTIONS
FOR
FISCAL
YEAR
2000.—For purposes of subparagraph
(A)(i)(III)—
‘‘(i) the amount specified in this clause is the
amount specified in paragraph (2)(B)(i)(I) for fiscal year
2000, less the total amount remaining available pursu-
ant to paragraph (2)(A)(iii);
‘‘(ii) the amount specified in this clause for a State
is the amount by which the State’s expenditures under
this title in fiscal years 2000, 2001, and 2002 exceed
the State’s allotment for fiscal year 2000 under sub-
section (b); and
‘‘(iii) the amount specified in this clause is the
sum, for all States entitled to a redistribution under
subparagraph (A) from the allotments for fiscal year
2000, of the amounts specified in clause (ii).’’.
(C) CONFORMING AMENDMENTS.—Such section 2104(g)
is further amended—
(i) in its heading, by striking ‘‘AND 1999’’ and
inserting ‘‘, 1999, AND 2000’’; and
(ii) in paragraph (3)—
(I) by striking ‘‘or fiscal year 1999’’ and
inserting ‘‘, fiscal year 1999, or fiscal year 2000’’;
and
(II) by striking ‘‘or November 30, 2001’’ and
inserting ‘‘November 30, 2001, or November 30,
2002’’, respectively.
(3) EXTENSION AND REVISION OF RETAINED AND REDISTRIB-
UTED ALLOTMENTS FOR FISCAL YEAR 2001.—
(A) PERMITTING AND EXTENDING RETENTION OF PORTION
OF FISCAL YEAR 2001 ALLOTMENT.—Paragraph (2) of such
section 2104(g), as amended in paragraph (2)(A)(ii), is fur-
ther amended—
(i) in the heading, by striking ‘‘2000’’ and inserting
‘‘2001’’; and
(ii) by adding at the end of subparagraph (A) the
following:
‘‘(iv) 
FISCAL
YEAR
2001
ALLOTMENT.—Of 
the
amounts allotted to a State pursuant to this section
for fiscal year 2001 that were not expended by the
42 USC 1397dd.
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117 STAT. 894
PUBLIC LAW 108–74—AUG. 15, 2003
State by the end of fiscal year 2003, 50 percent of
that amount shall remain available for expenditure
by the State through the end of fiscal year 2005.’’.
(B) REDISTRIBUTED
ALLOTMENTS.—Paragraph (1) of
such section 2104(g), as amended in paragraph (2)(B), is
further amended—
(i) in subparagraph (A), by inserting ‘‘or for fiscal
year 2001 by the end of fiscal year 2003,’’ after ‘‘fiscal
year 2002,’’;
(ii) in subparagraph (A), by striking ‘‘1999, or
2000’’ and inserting ‘‘1999, 2000, or 2001’’;
(iii) in subparagraph (A)(i)—
(I) by striking ‘‘or’’ at the end of subclause
(II),
(II) by striking the period at the end of sub-
clause (III) and inserting ‘‘; or’’; and
(III) by adding at the end the following new
subclause:
‘‘(IV) the fiscal year 2001 allotment, the
amount specified in subparagraph (D)(i) (less the
total of the amounts under clause (ii) for such
fiscal year), multiplied by the ratio of the amount
specified in subparagraph (D)(ii) for the State to
the amount specified in subparagraph (D)(iii).’’;
(iv) in subparagraph (A)(ii), by striking ‘‘or 2000’’
and inserting ‘‘2000, or 2001’’;
(v) in subparagraph (B)—
(I) by striking ‘‘and’’ at the end of clause (ii);
(II) by redesignating clause (iii) as clause (iv);
and
(III) by inserting after clause (ii) the following
new clause:
‘‘(iii) notwithstanding subsection (e), with respect
to fiscal year 2001, shall remain available for expendi-
ture by the State through the end of fiscal year 2005;
and’’; and
(vi) by adding at the end the following new
subparagraph:
‘‘(D) AMOUNTS USED IN COMPUTING REDISTRIBUTIONS
FOR
FISCAL
YEAR
2001.—For purposes of subparagraph
(A)(i)(IV)—
‘‘(i) the amount specified in this clause is the
amount specified in paragraph (2)(B)(i)(I) for fiscal year
2001, less the total amount remaining available pursu-
ant to paragraph (2)(A)(iv);
‘‘(ii) the amount specified in this clause for a State
is the amount by which the State’s expenditures under
this title in fiscal years 2001, 2002, and 2003 exceed
the State’s allotment for fiscal year 2001 under sub-
section (b); and
‘‘(iii) the amount specified in this clause is the
sum, for all States entitled to a redistribution under
subparagraph (A) from the allotments for fiscal year
2001, of the amounts specified in clause (ii).’’.
(C) CONFORMING AMENDMENTS.—Such section 2104(g)
is further amended—
42 USC 1397dd.
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117 STAT. 895
PUBLIC LAW 108–74—AUG. 15, 2003
(i) in its heading, by striking ‘‘AND 2000’’ and
inserting ‘‘2000, AND 2001’’; and
(ii) in paragraph (3)—
(I) by striking ‘‘or fiscal year 2000’’ and
inserting ‘‘fiscal year 2000, or fiscal year 2001’’;
and
(II) by striking ‘‘or November 30, 2002,’’ and
inserting ‘‘November 30, 2002, or November 30,
2003,’’, respectively.
(4) EFFECTIVE
DATE.—This subsection, and the amend-
ments made by this subsection, shall be effective as if this
subsection had been enacted on September 30, 2002, and
amounts under title XXI of the Social Security Act (42 U.S.C.
1397aa et seq.) from allotments for fiscal years 1998 through
2000 are available for expenditure on and after October 1,
2002, under the amendments made by this subsection as if
this subsection had been enacted on September 30, 2002.
(b) AUTHORITY FOR QUALIFYING STATES TO USE PORTION OF
SCHIP FUNDS FOR MEDICAID EXPENDITURES.—Section 2105 of the
Social Security Act (42 U.S.C. 1397ee) is amended by adding at
the end the following:
‘‘(g) AUTHORITY
FOR QUALIFYING STATES TO USE CERTAIN
FUNDS FOR MEDICAID EXPENDITURES.—
‘‘(1) STATE OPTION.—
‘‘(A) IN GENERAL.—Notwithstanding any other provi-
sion of law, a qualifying State (as defined in paragraph
(2)) may elect to use not more than 20 percent of any
allotment under section 2104 for fiscal year 1998, 1999,
2000, or 2001 (insofar as it is available under subsections
(e) and (g) of such section) for payments under title XIX
in accordance with subparagraph (B), instead of for
expenditures under this title.
‘‘(B) PAYMENTS TO STATES.—
‘‘(i) IN GENERAL.—In the case of a qualifying State
that has elected the option described in subparagraph
(A), subject to the availability of funds under such
subparagraph with respect to the State, the Secretary
shall pay the State an amount each quarter equal
to the additional amount that would have been paid
to the State under title XIX with respect to expendi-
tures described in clause (ii) if the enhanced FMAP
(as determined under subsection (b)) had been sub-
stituted for the Federal medical assistance percentage
(as defined in section 1905(b)).
‘‘(ii) EXPENDITURES DESCRIBED.—For purposes of
this subparagraph, the expenditures described in this
clause are expenditures, made after the date of the
enactment of this subsection and during the period
in which funds are available to the qualifying State
for use under subparagraph (A), for medical assistance
under title XIX to individuals who have not attained
age 19 and whose family income exceeds 150 percent
of the poverty line.
‘‘(iii) NO IMPACT ON DETERMINATION OF BUDGET
NEUTRALITY FOR WAIVERS.—In the case of a qualifying
State that uses amounts paid under this subsection
for expenditures described in clause (ii) that are
42 USC 1397dd
note.
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117 STAT. 896
PUBLIC LAW 108–74—AUG. 15, 2003
incurred under a waiver approved for the State, any
budget neutrality determinations with respect to such
waiver shall be determined without regard to such
amounts paid.
‘‘(2) QUALIFYING STATE.—In this subsection, the term ‘quali-
fying State’ means a State that, on and after April 15, 1997,
has an income eligibility standard that is at least 185 percent
of the poverty line with respect to any 1 or more categories
of children (other than infants) who are eligible for medical
assistance under section 1902(a)(10)(A) or, in the case of a
State that has a statewide waiver in effect under section 1115
with respect to title XIX that was first implemented on July
1, 1995, has an income eligibility standard under such waiver
for children that is at least 185 percent of the poverty line,
or, in the case of a State that has a statewide waiver in
effect under section 1115 with respect to title XIX that was
first implemented on January 1, 1994, has an income eligibility
standard under such waiver for children who lack health insur-
ance that is at least 185 percent of the poverty line.
‘‘(3) CONSTRUCTION.—Nothing in paragraphs (1) and (2)
shall be construed as modifying the requirements applicable
to States implementing State child health plans under this
title.’’.
SEC. 2. TECHNICAL CORRECTION.
(a) TEMPORARY INCREASE OF THE MEDICAID FMAP.—Subpara-
graphs (A) and (B) of section 401(a)(6) of the Jobs and Growth
Tax Relief Reconciliation Act of 2003 (Public Law 108–27) are
amended to read as follows:
‘‘(A) IN GENERAL.—Subject to subparagraph (B), a State
is eligible for an increase in its FMAP under paragraph
(3) or an increase in a cap amount under paragraph (4)
for any date after September 2, 2003, only if the eligibility
under its State plan under title XIX of the Social Security
Act (including any waiver under such title or under section
1115 of such Act (42 U.S.C. 1315)) applied as of such
date is no more restrictive than the eligibility under such
plan (or waiver) as in effect on September 2, 2003.
‘‘(B) STATE
REINSTATEMENT
OF
ELIGIBILITY
PER-
MITTED.—A State that has restricted eligibility under its
State plan under title XIX of the Social Security Act
(including any waiver under such title or under section
1115 of such Act (42 U.S.C. 1315)) for any date after
September 2, 2003, is eligible for an increase in its FMAP
under paragraph (3) or an increase in a cap amount under
paragraph (4) for subsequent dates in which the State
has reinstated eligibility that is no more restrictive than
the eligibility under such plan (or waiver) as in effect
on September 2, 2003.’’.
(b) RETROACTIVE EFFECTIVE DATE.—The amendment made by
subsection (a) shall take effect as if included in the enactment
42 USC 1396d
note.
Ante, p. 765.
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117 STAT. 897
PUBLIC LAW 108–74—AUG. 15, 2003
LEGISLATIVE HISTORY—H.R. 2854 (S. 312):
SENATE REPORTS: No. 108–78 accompanying S. 312 (Comm. on Finance).
CONGRESSIONAL RECORD, Vol. 149 (2003):
July 25, considered and passed House.
July 31, considered and passed Senate.
of section 401 of the Jobs and Growth Tax Relief Reconciliation
Act of 2003 (Public Law 108–27).
Approved August 15, 2003.
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